2023-08-01 18:21:05
At least things are progressing with the new headquarters: the building on the Prinses Irenestraat is now largely glazed. At the beginning of the year there was only a skeleton to be seen: remains of the previous brutalist building from the 1970s, which offended the eye in the south of Amsterdam. Now the complex is being rebuilt here, the thick concrete blocks of the facade have given way to large glass surfaces – so far the reality in this case comes very close to what the visualization promised.
Structurally things are progressing for Philips…
Construction is making rapid progress for the Philips group, which will move into this presumably light-flooded office building in the Zuidas business district at the beginning of next year. From a business point of view, there has been limited talk so far. When Philips reported on the latest quarter a week ago, investors were able to look forward to more sales and profits and even more to the fact that management corrected the forecast for the full year slightly upwards.
… less in the operative business
This was offset by a drop in incoming orders, but above all by the continuing uncertainty about the recall of ventilators in sleep therapy. The foreseeable costs of the recall have so far led to provisions in the billions, hundreds of millions are expected because of an expected class action lawsuit in the United States. After the quarterly figures were published, the share lost value and slipped below 20 euros. CEO Roy Jakobs said he simply couldn’t report anything new when it came to ventilators.
The course compares with a high of almost 49 euros two years ago, until autumn last year it fell below 12 euros as a result of the recall. Jakobs supported the share with a few quick measures immediately after taking office in October, including large-scale job cuts. Research and development and other departments are reorganized. The conversion of the new headquarters could have a symbolic effect. But it has a relatively tight time frame, while Philips has been a construction site under the chairmanship of the past two or three decades. The common thread that ran through it was that the conglomerate was opening up more and more sectors and concentrating more and more on medical technology. The company now consists almost entirely of her.
Shrinking as a strategy
The symbolism of the headquarters lies more in the downsizing than in the conversion. As a diversified technology conglomerate, Philips dominated the public image in its former home of Eindhoven. In the 1990s, they succumbed to the pull of the metropolis and relocated their headquarters there. After all, far away from production, it still sits in an imposing tower on the Amstel. The building “PI59” will soon follow, much less conspicuously, the abbreviation stands for the first letters of the street and the house number.
Philips was among the companies listed on the Amsterdam Stock Exchange that reported second quarter results last week. NXP, a former Philips subsidiary, also sees an upswing in operational business. According to the chip manufacturer, the industry bottomed out in the first half of the year. Above all, the company sees its business with car manufacturers picking up again significantly. Excessive inventories have been reduced and the worst disruptions to the supply chain have been overcome – which Philips also reported.
The quarterly season has begun
Something similar is being observed by ASML in Veldhoven, the group that supplies semiconductor companies with the machines for chip production. He, too, sees the most difficult time in the industry as a whole and has raised his forecast for annual sales. According to the CEO Peter Wennink, many customers are still reluctant to invest because of uncertain prospects – this can be observed at the group headquarters in the business with the latest generation of machines, the so-called EUV machines. On the other hand, the demand for the older DUV devices is increasing. Demand there is still higher than can be produced in Veldhoven.
Mixed picture
Several companies exceeded expectations: the Franco-Dutch airline duo, Air France-KLM, was among them. Telecoms supplier KPN also pleased investors, and in chemicals, paints supplier Akzonobel raised its forecast. The Amsterdam Stock Exchange belongs to the seven-country association Euronext, which is itself a listed stock exchange operator. He announced that he would buy back his own shares.
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There are also a few outliers below: The lighting company Signify – once the root of the Philips group and split off from it years ago – disappointed with its current report. On Monday, the Heineken brewing group cut its outlook for the first half of the year due to dwindling sales and high costs. This week reports include the publishing house Wolters Kluwer, the coffee manufacturer JDE Peet’s and the largest Dutch bank ING.
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