Annual Report 2008
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Our strategy

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Through our strategy, we aim to fuel growth by making Philips the leading brand in health and well-being. Our strategy further positions Philips as a market-driven, people-centric company with a structure that reflects the needs of its customer base, while also increasing shareholder value.

Our ways of working

  • We are a people-centric company that organizes around customers and markets
  • We invest in a strong brand and consistently deliver on our brand promise of “sense and simplicity”, in our actions, products and services
  • We deliver innovation by investing in world-class strengths in end-user insights, technology, design and superior supplier networks
  • We develop our people’s leadership, talent and engagement and align ourselves with high-performance benchmarks
  • We invest in high-growth and profitable businesses and emerging geographies to achieve market leadership positions
  • We are committed to sustainability and focus on making the difference in efficient energy use
  • We drive operational excellence and quality to best-in-class levels, allowing us the above-mentioned strategic investments in our businesses

On December 4, 2008, we confirmed that we continue to execute on our Vision 2010 strategy. However, given the current economic environment, the financial targets set as part of Vision 2010 are not expected to be met by the end of 2010, as originally planned, due to the continuing economic slowdown and resulting declining demand in key markets. We remain fully committed to our strategy, and will update the market on the realization of our financial objectives when economic visibility improves.

Our ambitions

Our financial targets

  • Double EBITA per common share from 2007 level
  • Group EBITA margin of 10-11%
  • Sector EBITA targets:
    • Healthcare 15-17%
    • Consumer Lifestyle 8-10%
    • Lighting 12-14%


  • Comparable sales growth of 6% average per year
  • Return on invested capital of 12-13%

Our EcoVision4 targets

over the period 2007 - 2012

  • Double revenues from Green Products to 30% of total sales
  • Double investment in Green Innovations to a cumulative EUR 1 billion
  • Improve our operational energy efficiency by 25% and reduce CO 2 emissions by 25%

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  • EBITA
    EBITA - US GAAP: earnings before interest, tax and amortization (EBITA) represents income from continuing operations excluding results attributable to minority interest holders, results relating to equity-accounted investees, income taxes, financial income and expenses, amortization and impairment on intangible assets (excluding software) and write-off of in-process R&D. Philips believes that EBITA information makes the underlying performance of its businesses more transparent by factoring out the amortization of intangible assets, which arises when acquisitions are consolidated.
  • EBITA per common share
    EBITA divided by the weighted average number of shares outstanding (basic). The same principle is used for the definition of net income or stockholders equity per common share, replacing EBITA.
This is an interactive electronic version of the Philips Annual Report 2008 and also contains certain information in summarized form. The contents of this version are qualified in their entirety by reference to the printed version of the Philips Annual Report 2008. The printed version is available as a PDF file on this website. Information about: forward-looking statements, third-party market share data, fair value information, US GAAP basis of presentation, use of non-US GAAP information, statutory financial statements and management report, revision and reclassifications and analysis of 2007 compared to 2006.
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