Philips profit plunges 79 percent in first quarter

First-quarter profit at Dutch electronics giant Philips plummeted 79 percent.

First-quarter profit at Dutch electronics giant Philips Electronics plummeted 79 percent, due partly to a loss in the group's flat-screen joint venture.

Net income in the first three months of the year slumped to Euro 117 million (AU$198.5 million) as of March 31, the last day in the period reported) from Euro 550 million in the same period a year earlier, the Amsterdam-based manufacturer said Monday.

The first quarter of 2004, however, included a Euro 156 million gain from the sale of a stake in Atos Origin, a French IT services company.

Sales in the first quarter were flat at Euro 6.64 billion, compared to Euro 6.63 billion a year earlier.

Hit by declining prices for its flat-screen products, Philips LCD posted a first-quarter loss of 79 billion won (AU$134 million), compared with a net profit of 628 billion won a year earlier. Philips said that its share of the loss amounted to Euro 34 million.

Semiconductor sales in the first quarter dipped 3 percent to Euro 1.01 billion, from Euro 1.04 billion a year ago. Philips expects chip sales to grow by between 1 percent and 6 percent in the second quarter, it said.

Sales in the consumer electronics unit, the group's largest, which produces a wide range of products including television sets and DVD recorders, increased 7 percent to Euro 2.15 billion in the first quarter, compared to Euro 2.01 billion a year earlier.

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