Philips accelerates Green Innovation and reports revenue from Green Products reaching close to half of total sales

• Green Product¹ sales increased to 45% of total sales (EUR 11.3 billion) in 2012
• Total investments in Green Innovation at EUR 569 million in 2012, mainly driven by investments in sustainable LED lighting
• Carbon reduction target achieved, with 25% decrease in operational CO2 emissions over five years

Amsterdam, the Netherlands – Today Royal Philips Electronics (NYSE:PHG, AEX:PHIA) reported Green Product sales of EUR 11.3 billion in 2012, marking 45% of total sales and moving the company significantly closer to its EcoVision sustainability performance targets of 2015. Healthcare drove the highest Green Product nominal sales growth with 36% and expanded its Green Product portfolio with 16 new introductions to improve patient outcomes and expand access to care, while reducing environmental impact.

This achievement underscores Philips’ continued focus on driving sustainability throughout the organization and aim to improve the health and well-being of people through innovation. “We are proud to report that today Philips improves the lives² of every 4th person on earth and our ambition is to grow this target to 3 billion a year by 2025 as part of our company’s vision”, said Jim Andrew, Chairman of the Sustainability Board and Philips’ Chief Strategy & Innovation Officer. “We have also made huge progress in the environmental impact of our operations and have reached our five-year carbon reduction target of 25% this year. This was primarily accomplished through energy saving programs in our major operational sites, green logistics, reduced travel and increased use of renewable energy, which we will continue to implement globally.”

In 2012 Philips invested EUR 569 million in Green Innovation, on track to reach our target of EUR 2 billion by 2015. Lighting led the way by investing over EUR 325 million in innovation towards furthering the LED revolution which aims to substantially reduce carbon dioxide emissions by switching to energy-efficient lighting.

In Consumer Lifestyle we implemented our voluntary commitment to phase out polyvinyl chloride (PVC) and brominated flame retardants (BFR) from our products, and for the first time all our espresso coffee machines launched during the year are free of these substances.

Investments in Healthcare support the increasing interest that we see in societies across the globe for green hospitals and reduced environmental impact of healthcare. This commitment was recognized by COCIR³  in choosing Philips Magnetic Resonance Imaging (MRI) as the front runner in the industry for energy-efficient MRI with 22% lower average energy consumption.

The Philips 2012 sustainability update is an integrated part of the Philips 2012 Annual Report, available at: www.annualreport2012.philips.com

Notes to the editor:

About EcoVision

Philips’ EcoVision program comprises key performance indicators in the areas of sales, innovation, improved lives, operations, employee engagement and supplier sustainability. Some important targets for 2015 are:

Improving people’s lives
Target: 2 billion lives a year  by 2015 (3 billion lives a year by 2025)

Energy efficiency of Philips products
Target: 50% improvement by 2015 (for the average total product portfolio) compared to 2009

Closing the material loop
Target: Double global collection and recycling and the amount of recycled materials in products by 2015 compared to 2009

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^{1Green Products need to prove leadership in at least one Green Focal Area compared to industry standards, which is defined by a sector specific pear group. This is done either by outperforming reference products (which can be a competitor or predecessor product in the particular product family) by at least 10% outperforming product-specific eco-requirements or by being awarded with a recognized eco-performance label. The Green Focal Areas are: Energy efficiency, Packaging, Hazardous substances, Weight, Recycling and disposal and Lifetime reliability.}

^{2To calculate how many lives we are improving, market intelligence and statistical data on the number of people touched by the products contributing to the social or ecological dimension over the lifetime of a product are multiplied by the number of those products delivered in a year. After elimination of double counts, the number of lives improved by our innovative solutions is calculated. In 2012 we established our baseline at 1.7 billion a year.}

^{3According to COCIR (European Coordination Committee of the Radiological, Electromedical and Healthcare IT Industry), the Philips MRI fleet average energy consumption in ‘off’ and ‘ready-to-scan’ mode is deemed 22% lower than the average consumption of the market fleet for 2011.}