06:36 AM EDT, 07/29/2024 (MT Newswires) -- Philips (PHG) US-listed stock jumped early Monday as the Dutch health technology firm logged higher second-quarter earnings on a yearly basis, aided by cost savings and a payout from insurers for liability claims related to its respiratory care products.

Adjusted earnings advanced to 0.30 euros ($0.33) per share for the June quarter from 0.27 euros the year before, according to the company. Sales edged down to 4.46 billion euros from 4.47 billion euros, while four analysts surveyed by Capital IQ expected 4.45 billion euros. The company's shares on the New York Stock Exchange spiked 9.2% in premarket activity.

The company received 538 million euros as insurance income after an agreement was reached with insurers earlier in the quarter to cover liability claims for recalled products from its Respironics business. The firm expects the remaining payment this year, Chief Financial Officer Abhijit Bhattacharya said during an earnings call, according to a Capital IQ transcript.

Restructuring, acquisition-related and other items amounted to a net gain of 381 million euros, including the 538 million euros insurance income, compared with a loss of 161 million euros last year. The company's productivity moves helped it save 195 million euros in the second quarter, including 57 million euros in operating model savings and 71 million euros in procurement savings.

Comparable sales rose 2% in the quarter, compared with 9% in the 2023 quarter. Same-store sales in the diagnosis and treatment segment gained 4%, while connected care inclined 2%. Personal health division comparable sales ticked down to a 2% increase from 3% a year ago.

"I am encouraged by our return to order intake growth this quarter, primarily driven by North America," Chief Executive Roy Jakobs said in a statement. "Within a challenging macro environment we achieved strong margin improvement, supported by our productivity program, solid operational cash flow due to improved working capital management and comparable sales growth in line with our plan."

Philips continues to estimate comparable sales growth of between 3% and 5% for the 2024 financial year, while acknowledging that "uncertainties remain." It also reaffirmed its adjusted earnings before interest, taxes and amortization guidance of 11% to 11.5%.

"We expect sales growth in the third quarter to stay broadly in line with the first half of the year on the back of 11% growth in (the third quarter of 2023)," Bhattacharya told analysts on the call.

Price: 28.18, Change: +2.42, Percent Change: +9.39