Philips Electronics said its consumer business had held up in weaker economies and posted second-quarter results in line with expectations, reassuring investors and sending its shares up over 7 per cent.
Amsterdam-headquartered Philips said today earnings before interest, tax and amortisation (EBITA) rose 7 per cent to €413 million ($648.8 million).
Earnings were influenced by a number of extraordinary items, including €121 million of restructuring or acquisition-related charges and a €56 million gain on the sale of Philips' TV set-top box business.
"When you exclude all the 'funnies', EBITA and EBIT are spot on our estimates. It's reassuring that they are seeing continued growth in the second half for medical and emerging markets," ING analyst Marcel Achterberg said.
Lehman Brothers analysts said the results were broadly in line, as a better-than-expected performance for the consumer business excluding the troubled television unit offset a weaker healthcare business.
Philips shares rose 7.6 per cent to €20. by 9.08am, beating a 1.3 per cent rise in the DJ Stoxx 50 index. The shares are still down about 30 per cent this year.
"We were seeing a sharp decline (in the share price) on Friday, apparently because people got worried that the end of the world was getting near ... with these results, there is no reason to be extremely worried about Philips," Petercam analyst Eric de Graaf said.
Philips said the scale of the economic downturn in Europe and North America had yet to become clear, but it expected growth in emerging markets to continue, supporting sales in all of its three main divisions in the second half of the year.
The Consumer Lifestyle division, which makes products ranging from TVs and MP3 players to kettles and shavers, reported comparable sales growth of 7 per cent, driven by double-digit growth in emerging markets.
Philips Chief Financial Officer Pierre-Jean Sivignon said the company's business with energy-efficient lighting had also done well.