Philips Electronics has warned of sharply lower profits at two of its three key divisions, lighting and consumer lifestyle, and said it would announce cost cuts soon.
Philips, the world's biggest lighting maker and Europe's biggest consumer electronics producer, said in a statement it expected a "low single-digit" sales decline in the April-to-June period for the consumer lifestyle division, whose products range from toasters to shavers.
The company, which is also a top three hospital equipment maker, said the impact of selling its TV operations, a deal which was announced in April, would also hurt earnings.
For lighting, Philips said it expected "low single-digit comparable sales growth" in the second quarter due to weaker-than-expected market conditions, especially in the western European consumer market and construction in mature markets.
For the consumer lifestyle business, Philips sees second-quarter earnings before interest, tax and amortisation (EBITA) of €50 million, and for the lighting unit €85 million - in both cases marking sharp declines from the first quarter and from the year-ago quarter.
It said it will announce a cost reduction programme shortly.
Reuters
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