Philips raised its 2023 sales prospects after the company recorded better-than-expected quarterly earnings.
The Amsterdam-based medical device giant announced its Q2 2023 results, reporting adjusted earnings before interest, taxes, and amortisation (EBITA) of $502m (€453m).
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Total sales for the group reached $5bn (€4.5bn), with a 9% comparable growth.
Based on its improved performance, the company stated it now expects to deliver mid-single-digit comparable sales growth. It also anticipates an adjusted EBITA margin at the upper end of the high-single-digit range.
Philips has been weathering the fallout from the recall of millions of devices on a global scale. The positive airway pressure devices used to help patients sleep were involved in a Class I recall, the most serious type of recall, by the US Food and Drug Administration. The ventilators, whose recall started in 2021, began with issues around the toxic foam used in the devices. A further recall in April 2023 was due to incorrect serial numbering.
In a Q1 report earlier this year, Philips announced it had set aside $634m in litigation provisions to cover the costs of several lawsuits filed against the company. It issued an update on the recall in its Q2 earnings report, saying that 99% of the new replacement devices and repair kits for the faulty devices have been produced.
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By GlobalDataPhilips has conducted tests on the new foam and said it is within safety limits, although the FDA is yet to comment on the submitted data.
Philips’ CEO Roy Jakobs said: “Completing the Philips Respironics field action remains our highest priority. The vast majority of the sleep therapy devices are now with patients and home care providers, and we are fully focused on the remediation of the affected ventilators.
“Looking ahead, we are confident in the execution of our plan and have raised our outlook for the full year 2023, acknowledging that uncertainties remain.”
