Philips reorganises to up profits (update)

Philips is to simplify its organisation and reduce operations to three core divisions, the electronics giant said on Monday.

The company expects the reorganisation to cut costs by €150m to €200m a year and to lead to a doubling of operating profit (ebita) per share by 2010.
Once the reorganisation has been completed and various units have been merged, Philips will have three key divisions: healthcare, lighting and consumer lifestyle.
Chairman Gerard Kleisterlee told reporters that there would be no compulsory redundancies, with surplus jobs disappearing through natural wastage.
In addition, Philips is to return some €3bn to shareholders through dividends and a share buy-back programme.

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