Philips 2008 Annual Report Download - page 87

Driving transformation
As we are the market leader in both solid-state lighting
and energy-efficient solutions, the radical changes in the
lighting industry give us ample opportunities to shape
our own future. Our acquisition of Genlyte, completed
in 2008, is particularly important in strengthening
our position in professional luminaires and in the
North American lighting market. Following our
recent acquisitions, we are well positioned across
the entire solid-state lighting value chain.
Furthermore, we implemented a major transformation
program in 2008. This has helped streamline the
organization, simplify the structure, and shape our
Lighting sector around future opportunities. It has
involved reducing complexity as well as reallocating
and reinvesting resources in R&D and marketing,
with a stronger emphasis on the application side of
the business as well as on emerging markets. It has
also helped us accelerate the shift from traditional
technologies to energy-efficient and solid-state
lighting technologies, as well as to project sales.
Philips Lighting has manufacturing facilities in some
25 countries in all regions of the world and sales
organizations in more than 60. Commercial activities
in other countries are handled via dealers working
with our International Sales organization. Lighting
has approximately 57,000 employees worldwide.
Lighting strives for full compliance with relevant
regulatory requirements, including the European
Union’s WEEE (Waste from Electrical and Electronic
Equipment) and RoHS (Restriction of Hazardous
Substances) directives.
With regard to sourcing, please refer to the section
Supply management on page 54 of this Annual Report.
Progress against targets
In the 2007 Annual Report, Lighting identified a
number of key objectives for 2008. The progress
made in addressing these is discussed below.
Emerging markets and energy-efficient lighting
In 2008 we continued to strengthen our position in
emerging markets, with double-digit comparable sales
growth. Among a large number of high-profile projects
in emerging markets, we provided a state-of-the-art
lighting solution for the major bridge in Sao Paulo,
Brazil, reducing energy consumption by 53%. In the
SESA (Sustainable Energy Solutions for Africa) project,
we partnered with the UN and national governments
on a renewable energy for lighting project for 14 countries
in Sub-Saharan Africa.
Philips to create Guanajuato ‘City of Light’
Philips in Mexico has signed an agreement with
the Government of Guanajuato City to turn this
UNESCO World Heritage site into ‘Guanajuato
– Ciudad Luz’ (City of Light). The plan will be
implemented in collaboration with a multidisciplinary
team (government, urbanists, designers, architects,
technicians, etc) coordinated by Philips.
This first city lighting masterplan to be deployed
in Latin America will bring many benefits to
Guanajuato – enhancing the architecture,
monuments, churches, streets and plazas, making
the public and decorative lighting energy-efficient,
increasing safety and boosting tourism.
We have continued strongly promoting our Green
value propositions and the enhanced energy savings
that are possible through our systems approach and
renovation focus. Energy-efficient lighting now accounts
for over 53% of Lighting sales, excluding the acquired
Partners in Lighting International (PLI) and Genlyte,
up from just under 50% in 2007.
System solutions – professional and
consumer luminaires
We have continued expanding in the direction of system
solutions, especially incorporating solid-state lighting.
We completed the acquisition of Genlyte, a leader in
the North American professional luminaires market,
in early 2008. Integration is well under way and significant
synergies are being realized. The integration of PLI
(acquired in 2007) is on schedule; its activities are
being expanded outside Europe and it has launched
major new LED-based product ranges for the home.
Our other major recent acquisition, Color Kinetics,
the solid-state lighting solutions company also acquired
in 2007, has been fully embedded and leveraged across
the value chain.
Philips Annual Report 2008 87
122
Performance statements
114
Supervisory Board report
110
Our leadership
94
Risk management
70
Our sector performance
Lighting