Royal Philips Electronics this week provided a financial update for its Medical Systems division. Steve Rusckowski, CEO of Philips Medical Systems, detailed Philips’ efforts to fine-tune its professional healthcare business as an engine for long-term value creation. Philips reconfirmed that the division is on track to achieving annual organic sales growth of 6 percent and an EBITA margin of 14-15 percent in 2007.
Philip’s management team said that adjustments to its operational performance could lead to a further improvement of approximately one additional percentage point in the EBITA margin of the Medical Systems division by 2008/2009.
To facilitate this growth, Philips said it will continue building on its PET/CT system using ‘time-of-flight’ technology that captures sharper images faster, increasing the number of patients that can be examined. Philips will also take steps to further enhance the operational performance of its Medical Systems business and build on the market share gains achieved over the past three years by focusing on high-value developed and high-growth emerging markets.
Philips also said its focus on the ‘care cycle’ in healthcare should also spark additional growth.
“Both patients and caregivers struggle with a complex, fragmented healthcare system. We believe the best way to reduce this complexity is by addressing the needs of the healthcare industry from the perspective of patients and their health problems,” said Rusckowski. “That means delivering solutions in the fields of cardiology, oncology and women’s health that address what we call the ‘care cycle’ – the cycle of prevention, screening, diagnosis, treatment and management of medical conditions with technologies and services both inside and outside the hospital.”