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Philips profit plunges, warns on targets

Koninklijke Philips NV on Tuesday reported a 67% drop in fourth-quarter net profit and the Dutch electronics maker warned that it is behind on its financial targets.

Philips, whose products range from shavers and co

ffee machines to hospital scanners, said net profit was EUR134 million ($150.69 million) in the last three months of 2014, compared with EUR412 million in the same period a year earlier. Sales were EUR6.5 billion, up from EUR6.4 billion.

Chief Executive Frans van Houten said Philips is behind on its financial targets for 2016 following a series of operational setbacks at its health care division. He added he is "convinced that this does not change our longer-term performance potential."

Philips this month issued a profit warning for the fourth quarter, largely because of bigger-than-expected problems at a factory in Cleveland that makes medical imaging systems.

marketwatch