Philips fourth quarter earnings hit by regulatory fines; sells entertainment arm to Funai

The Associated Press

AMSTERDAM - Royal Philips Electronics NV says it will sell the entertainment division which contains many of the consumer products for which it is best known — including audio and video equipment — to Funai Electric Co., Ltd., of Japan for €150 million ($202 million) plus licensing fees.

Funai will assume manufacture of the Philips products but license and sell them under the Philips brand for five years.

Philips also reported fourth quarter earnings that were struck by a €509 million cartel-forming fine by European regulators, but improved on an operational basis.

Its net loss shrank to €162 million from €358 million in 2011, dominated by charges in both years. Sales grew 6.7 per cent to €7.16 billion. Philips said its operating earnings, excluding restructuring charges, were up 50 per cent to €875 million.