Philips Raises Chief Van Houten’s Pay as Revamp Boosts Profit
Royal Philips Electronics NV (PHIA) boosted Chief Executive Officer Frans van Houten’s total compensation to 3.4 million euros ($4.5 million) as his revamp of the world’s largest lighting manufacturer boosted earnings.
Van Houten will get a 1.28 million-euro variable cash bonus, or 116 percent of his 1.1 million-euro base salary, Philips said in the annual report published on its website today. The total figure includes stock options, pension costs and other items. The CEO, who took over in April 2011, got a total of 1.9 million euros for that year.
Van Houten, 52, is working through a overhaul to save 1.1 billion euros and cut 6,700 jobs and the Amsterdam-based company last month reported fourth-quarter profit that beat analysts’ estimates. The Philips veteran is pushing the company into high- margin areas such as lighting products that save energy and health-care equipment, losing the shackles of a consumer- electronics past.
He transferred the loss-making TV-unit into a joint venture with TPV Technology Ltd. and announced it would sell the underperforming audio and video unit to Funai Electric Co. (6839) Philips today said it will propose shareholders to drop Electronics from the company name, underlining the transformation.
Fourth-quarter earnings before interest, taxes, amortization and one-time items rose 50 percent to 875 million euros. Sales gained 6.7 percent to 7.16 billion euros. Health- care revenue rose 7.1 percent, while lighting sales surged 9.2 percent.
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