On Monday, Philips (PHG.AS), a Dutch health technology company, set aside 575 million euros ($631 million) for possible lawsuit costs related to its global respiratory machine recall.
Amsterdam-based Philips is dealing with the consequences of a June 2021 global recall of millions of sleep apnea respirators due to concerns about foam toxicity.
Over the previous two years, Philips’ market value has dropped 70% due to investors’ concerns about patient litigation.
CEO Roy Jakobs said the first-quarter provision was “in anticipation of a resolution of the economic loss class action in the U.S.” and an “important step in addressing the litigation.”
Philips is negotiating with the U.S. U.S. Food and Drug Administration (FDA) probe. Justice Dept.
It claimed the outcomes were too unclear to make a provision.
Philips reported better-than-expected first-quarter results, with core profit up almost 50% to 359 million euros and comparable sales up 6%.
A company-compiled poll predicted a 15% EBITA decline on a 2% sales increase.
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