emerging market turmoil deals setback for philips - home room air purifiers

Amsterdam-Philips expects a slowdown in early 2014 as it is working to cope with currency fluctuations in Turkey, Argentina, Indonesia and other emerging markets and weak health orders --care equipment.
The turmoil in developing economies is a setback for Dutch healthcare, lighting and consumer appliances, which has reshaped itself since Frans van Houten took over as chief executive in April 2011.
Philips suffered losses from stagnation or austerity --
The European and American markets have been hit, and its television, audio and video businesses have been struggling with low levels for years.
Asian competitors.
Van Houten cut costs in emerging markets, sold weak businesses and targeted new products, which led Philips shares to rise nearly 60% in two years.
The stock fell more than 3% at one point on Tuesday, but some investors were not worried about Van Howton's cautious guidance, hoping to further improve performance under his management.
"These data are usually reliable, except for some minor setbacks, including currency issues," said Rabobank analyst Hans Slob . " He still thinks Philips shares are "buying ".
"It is moving in the right direction and becoming a more agile ship.
This is a good investment case in the long run.
"Philips shares hit 28.
The euro fell 1% in 31st day of this month, its highest level since the beginning of 2008.
Gmt is 1500 euros.
Van Houten says the transformation of the world's largest lighting manufacturer is not over yet.
The company has reached 2013.
This year's target has set a slightly ambitious financial target for 2016.
Its target now is 2014.
2016 profit margin of earnings before interest, tax and amortization (EBITA)of 11-
12%, return on investment capital at least 14%, sales growth 4-6%.
The CEO warned that it would take only one small step to achieve these goals this year.
"What worries me is the currency volatility and turmoil in some countries, such as Turkey, the Argentine peso and the Indonesian rupee, Van Hatton said in an interview with Reuters insiders.
"These are of course the facts of life that we have to face," he said . "
"I am cautiously optimistic about the long term.
Economic Development.
Just in the short term, we do see some headwinds.
Van Houten said: "Exchange rate turmoil has forced Philips to study the amazing ways of paying orders, for example, when customers pay for lighting systems from energy saving.
Sphilips has shifted the focus to fast --growing health-
Care Equipment and Energy
Efficient lighting as part of its extensive restructuring.
Over the past few years, countries such as China, India and Russia have made big inroads, with more than three of their sales coming from developing world economies.
In a note to customers, ING analyst Robin van den Broek said: "Philips's outlook shows that profit margins will not show a strong further recovery in 2014 . ".
Philips report better than expected
Quarterly EBITA thanks to all business improvements.
It has introduced new and updated products, from electric toothbrushes and air purifiers to ultrasonic devices used in hospital emergency rooms.
Healthcare, now the largest of Philips's three major businesses, has dropped order intake by 1% in the quarter due to weak demand in its main market, reflecting uncertainty about health
Health care reform in the United States and austerity measures in Europe. Fourth-
EBITA was 0. 884 billion euros in the first quarter of the group ($1. 3 billion)
By contrast, 50 million euros were lost a year ago.
The company's quarterly net profit was 0. 412 billion euros, a loss of 0. 42 billion euros in the same period last year.
Sales increased by 7% year on year to 6. 8 billion euros.
In a poll commissioned by Reuters, analysts forecast a net profit of 0. 455 billion euros, EBITA of 0. 839 billion euros, and sales of 6 pounds. 8 billion euros.