Philips' New MRI System - Analyst Blog

Royal Philips Electronics (PHG) unveiled Philips Ingenia, the first-ever digital broadband magnetic resonance imaging (MRI) solution.

The Ingenia MR system incorporates, for the first time, digital signal acquisition and processing directly in the RF receive coil nearest to the patient. By capturing the signal directly in the RF coil and maintaining digital connectivity throughout the scanning process, Ingenia is able to generate a 40% improvement in signal-to-noise ratio, resulting in crisper image quality. The Ingenia MR system incorporates a hidden posterior coil enabling full body coverage and does away with placing multiple coils around various parts of the body.

The restructuring of Philip's product portfolio to better position itself as a more-focused company in the healthcare, lighting and lifestyle markets is in progress with several focused acquisitions and divestments in the recent past. This bodes well for the company going forward.

The company's continued ability to increase cash flow by bringing down working capital has helped sustain investments in growth initiatives while maintaining a strong balance sheet.

Working capital parameters expressed in days of sales, inventories and payables continued to improve. There was progress in managing costs, particularly the structural savings and fixed costs.

Philips may be unable to adapt swiftly to industry or market circumstances, which could have a material impact on its financial condition. Acquisitions could expose the company to integration risks and pose a management challenge.

Philip's global presence exposes the company to regional and local regulatory rules that may interfere with the realization of business opportunities and investments in the countries, where it operates. Philips' overall performance in the coming years will depend on realizing its growth ambitions in the emerging markets.

Philip's Healthcare segment is the second largest manufacturer of medical diagnostic equipment, which includes X-ray, ultrasound, magnetic resonance, medical information technology (IT), nuclear medicine, patient monitoring, information management and resuscitation products, as well as a comprehensive range of services. Panasonic Corporation (PC) and Sony Corporation (SNE) are its major competitors.

We currently have a Neutral recommendation on PHG.

 
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