During 2014 year Philips comparable sales declined 1% to 21.4 billion euro. EBITA, excluding restructuring and acquisition-related charges and other items, amounted to 1.9 billion euro, or 9.0% of sales, compared to 2.3 billion euro, or 10.5% of sales, in 2013. EBITA amounted to 821 million euro, or 3.8% of sales, compared to 2.3 billion euro, or 10.4% of sales, in 2013.
Net income amounted to 411 million euro, compared to 1.2 billion euro in 2013. Free cash flow improved to 497 million euro, compared to 82 million euro in 2013. Return on invested capital was 4.5%, compared to 13.9% in 2013.
“The fourth quarter – said Frans van Houten, Philips CEO – underscored a challenging 2014 for Philips. Our transformation efforts continued to show good results, even as we addressed performance issues, ongoing softness in end-markets like China and Russia, and stronger than anticipated foreign exchange impacts, particularly in emerging markets.
Healthcare was down overall, mainly caused by operational issues and soft markets. We were encouraged by market share gains in image-guided therapy and recorded strong orders in Europe and the Middle East, where we signed four multi-year solution deals. Our Cleveland factory resumed shipments to customers in January, marking an important milestone. Consumer Lifestyle performed very well in the quarter, continuing its three-year market-outperformance trend. Our Health & Wellness business delivered double-digit growth and we saw overall strong growth in EBITA.
Lighting recorded 20% sales growth in LED and expanded its margins in LED despite strong price erosion. Performance was, however, negatively impacted by results in China, Professional Lighting Solutions North America and conventional lighting. We took action to further restructure our manufacturing footprint in conventional lighting.”
