Philips is again setting aside hundreds of millions of euros to deal with the damage caused by the faulty apnea and ventilator equipment.
At the presentation of the figures for the first quarter of this year, the company reports that it has reserved 575 million euros for a possible claim for damages related to the recall of sleep apnea devices in the United States. Patients prepare a mass claim there. Earlier, the company already released about a billion euros for the recall itself.
Loss
The costs weigh heavily on Philips’ financial results. A loss of 583 million euros was incurred in the first three months, while more was sold; turnover rose to 4.1 billion. A year earlier, turnover amounted to 3.9 billion euros.
Various procedures regarding apnea and ventilators are still ongoing; estimates of the ultimate damage vary from five to ten billion euros in fines, damages and settlements, among other things.
Philips shares rose in value after the announcement of the operating results and the clarity that Philips gave about the expected costs of the claim in the US. In the afternoon, the share was more than 13 percent higher than at the start of the trading day.
To cut costs, Philips announced a round of layoffs of 6,000 jobs worldwide at the beginning of this year, after the company had cut 4,000 jobs a few months earlier. At the end of last year, 77,000 people worked at Philips.
Resists
The Works Council of the Research and Development business unit went to court in an attempt to block the reorganization. The FD reports this today. It concerns the Natlab, where research is carried out. The compact disc originated there, and the foundation for the later successful ASML was laid there. With the announced reorganization, hundreds of jobs will disappear and the research budget will be cut considerably.
If the judge in the Enterprise Chamber judges the reorganization to be ‘plainly unreasonable’, he can prohibit the reorganization.
- Philips again recalls apnea devices in the US and France
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