As filed with the Securities and Exchange Commission on February 26, 2019
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form
(Mark one)
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REGISTRATION STATEMENT PURSUANT TO SECTION 12(b)
OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 |
OR
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ANNUAL REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended
OR
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TRANSITION REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
OR
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SHELL COMPANY REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission file number 001-05146-01
(Exact name of Registrant as specified in charter)
ROYAL PHILIPS
(Translation of Registrant’s name into English)
The Netherlands
(Jurisdiction of incorporation or organization)
Philips Center, Amstelplein 2, 1096 BC Amsterdam, The Netherlands
(Address of principal executive office)
Marnix van Ginneken, Chief Legal Officer
+31 20 59 77232, marnix.van.ginneken@philips.com, Philips Center, Amstelplein 2, 1096 BC Amsterdam, The Netherlands
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)
Securities registered or to be registered pursuant to Section 12(b) of the Act:
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Title of each class
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Name of each exchange on which registered
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Common Shares - par value
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New York Stock Exchange
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Euro (EUR) 0.20 per share
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Securities registered or to be registered pursuant to Section 12(g) of the Act:
None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:
(Title of class)
None
Indicate the number of outstanding shares of each of the issuer’'s classes of capital or common stock as of the close of the period covered by the annual report:
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Class
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Outstanding at December 31, 2018
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KONINKLIJKE PHILIPS NV
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Common Shares par value EUR
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Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ☒
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934. ☐ Yes ☒ No
Note-Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ☒ Yes ☐ No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, or an emerging growth company. See definition of “large accelerated filer”, “accelerated filer” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐
† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
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U.S. GAAP ☐
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International Financial Reporting Standards as issued by by the International Accounting Standards Board ☒ |
Other ☐
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If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow. ☐ Item 17 ☐ Item 18
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No
Contents
- 1 Introduction
- 2 Form 20-F cross reference table
- 3 Message from the CEO
- 4 Board of Management and Executive Committee
- 5 Strategy and Businesses
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6
Financial performance
- 6.1 Performance review
- 6.2 Critical accounting policies
- 6.3 Taxation
- 6.4 Investor information
- 7 Societal impact
- 8 Risk management
- 9 Supervisory Board
- 10 Supervisory Board report
- 11 Corporate governance
- 12 Other information
- 13 Statements
1Introduction
This document contains information required for the Annual Report on Form 20-F for the year ended December 31, 2018 of Koninklijke Philips N.V. (the 2018 Form 20-F). Reference is made to the Form 20-F cross reference table herein. Only (i) the information in this document that is referenced in the Form 20-F cross reference table, (ii) this introduction and the cautionary statement “forward-looking statements” on the next two pages and (iii) the Exhibits shall be deemed to be filed with the Securities and Exchange Commission for any purpose. Any additional information in this document which is not referenced in the Form 20-F cross reference table, or the Exhibits themselves, shall not be deemed to be so incorporated by reference, shall not be part of the 2018 Form 20-F and is furnished to the Securities and Exchange Commission for information only.
The terms “Philips”, “Company”, “Philips Group”, “Group”, “we”, “our” and “us” refer to Koninklijke (Royal) Philips N.V. and as applicable to its subsidiaries and/or its interest in joint ventures and associates.
References to 'Signify' relate to Philips'
former Lighting segment (prior to deconsolidation as from the
end of November 2017 and when reported as discontinued
operations), Philips Lighting N.V. (before or after such
deconsolidation) or Signify N.V. (after its renaming in May
2018), as the context requires.
IFRS based information
The audited consolidated financial statements as of December 31, 2018 and 2017, and for each of the years in the three-year period ended December 31, 2018, included in the 2018 Form 20-F have been prepared in accordance with International Financial Reporting Standards (IFRS) as endorsed by the European Union (EU). All standards and interpretations issued by the International Accounting Standards Board (IASB) and the IFRS Interpretations Committee effective 2018 have been endorsed by the EU; consequently, the accounting policies applied by Philips also comply with IFRS as issued by the IASB. These accounting policies have been applied by group entities.
Use of non-IFRS information
In presenting and discussing the Philips financial position, operating results and cash flows, management uses certain financial measures that are not measures of financial performance or liquidity under IFRS (‘non-IFRS’). These non-IFRS measures should not be viewed in isolation as alternatives to the equivalent IFRS measure and should be used in conjunction with the most directly comparable IFRS measures. Non-IFRS measures do not have standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. A reconciliation of these non-IFRS measures to the most directly comparable IFRS measures is contained in this document. Reference is made in Reconciliation of non-IFRS information.
Third-party market share data
Statements regarding market share, contained in this document, including those regarding Philips’ competitive position, are based on outside sources such as specialized research institutes, industry and dealer panels in combination with management estimates. Where full year information regarding 2018 is not yet available to Philips, market share statements may also be based on estimates and projections prepared by outside sources or management. Rankings are based on sales unless otherwise stated.
Use of fair-value measurements
In presenting the Philips Group’s financial position, fair values are used for the measurement of various items in accordance with the applicable accounting standards. These fair values are based on market prices, where available, and are obtained from sources that are deemed to be reliable. Readers are cautioned that these values are subject to changes over time and are only valid at the balance sheet date. When quoted prices or observable market values are not readily available, fair values are estimated using valuation models, and unobservable inputs. Such fair value estimates require management to make significant assumptions with respect to future developments which are inherently uncertain and may therefore deviate from actual developments. Critical assumptions used are disclosed in the financial statements. In certain cases independent valuations are obtained to support management’s determination of fair values.
Documents on display
Philips’s SEC filings are publicly available through the SEC’s website at www.sec.gov. The SEC website contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. Philips’ Internet address is www.philips.com/investor.
For definitions and abbreviations reference is made in Definitions and abbreviations
1.1 Forward-looking statements
Pursuant to provisions of the United States Private Securities Litigation Reform Act of 1995, Philips is providing the following cautionary statement.
This document, including the information referred to in the Form 20-F cross reference table, contains certain forward-looking statements with respect to the financial condition, results of operations and business of Philips and certain of the plans and objectives of Philips with respect to these items, in particular, among other statements, certain statements in Item 4 “Information on the Company” with regard to management objectives, market trends, market standing, product volumes, business risks, the implementation of our Accelerate! program, the statements in Item 5 “Operating and financial review and prospects” with regards to trends in results of operations, margins overall market trends, risk management, exchange rates, the statements in Item 8 “Financial Information” relating to legal proceedings and goodwill and statements in Item 11 “Quantitative and qualitative disclosure about market risks” relating to risk caused by derivative positions, interest rate fluctuations and other financial exposure are forward-looking in nature. Forward-looking statements can be identified generally as those containing words such as “anticipates”, “assumes”, “believes”, “estimates”, “expects”, “should”, “will”, “will likely result”, “forecast”, “outlook”, “projects”, “may” or similar expressions. By their nature, these statements involve risk and uncertainty because they relate to future events and circumstances and there are many factors that could cause actual results and developments to differ materially from those expressed or implied by these statements.
These factors include but are not limited to: global economic and business conditions; political instability, including developments within the European Union, with adverse impact on financial markets; the successful implementation of Philips’ strategy and the ability to realize the benefits of this strategy; the ability to develop and market new products; changes in legislation; legal claims; changes in currency exchange rates and interest rates; future changes in tax rates and regulations, including trade tariffs; pension costs and actuarial assumptions; changes in raw materials prices; changes in employee costs; the ability to identify and complete successful acquisitions, and to integrate those acquisitions into the business, the ability to successfully exit certain businesses or restructure the operations; the rate of technological changes; cyber-attacks, breaches of cybersecurity; political, economic and other developments in countries where Philips operates; industry consolidation and competition; and the state of international capital markets as they may affect the timing and nature of the disposal by Philips of its remaining interests in Signify (formerly Philips Lighting).
As a result, Philips’ actual future results may differ materially from the plans, goals and expectations set forth in such forward-looking statements. For a discussion of factors that could cause future results to differ from such forward-looking statements, reference is made to the information in Item 3D “Risk Factors”.
2Form 20-F cross reference table
Only (i) the information in this document that is referenced in the Form 20-F cross reference table, (ii) the Introduction and the cautionary statements concerning forward-looking statements of this report on pages 5-6, and (iii) the Exhibits shall be deemed to be filed with the Securities and Exchange Commission for any purpose. The content of Philips’ websites and other websites referenced herein should not be considered to be a part of or incorporated into the 2018 Form 20-F. Any additional information which is not referenced in the Form 20-F cross reference table or the Exhibits themselves shall not be deemed to be so incorporated by reference, shall not be part of the 2018 Form 20-F and is furnished to the Securities and Exchange Commission for information only.
The table below sets out the location in this document of the information required by SEC Form 20-F. The exact location is included in the column ‘Location in this document’. The column “Page” refers to the starting page of the section for reference only (and is not intended to refer to the starting page of the specific subsection, if applicable).
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Item |
Form 20-F caption |
Location in this document |
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Part 1 |
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1 |
Identity of directors, senior management and advisors |
Not applicable |
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2 |
Offer statistics and expected timetable |
Not applicable |
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3 |
Key information |
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A Selected financial data |
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Dividend - Proposed distribution |
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B Capitalization and indebtedness |
Not applicable |
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C Reason for the offer and use of proceeds |
Not applicable |
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D Risk factors |
Risk categories and factors - Second paragraph |
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4 |
Information on the Company |
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A History and development of the company |
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Results of operations - Discontinued operations |
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Our businesses - Our structure in 2018 |
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Corporate governance - Corporate governance of the Philips Group - Introduction |
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Investor Relations - Corporate seat and head office |
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Investor contact - How to reach us |
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B Business Overview |
Introduction - Third-party market share data |
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Performance review - from 6.1.1 to 6.1.6 |
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Our businesses - Our structure in 2018 |
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Strategic risks - Last paragraph |
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Operational risks - Fourth & fifth paragraph |
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Corporate governance - Corporate governance of the Philips Group - Introduction |
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Supplier indicators - Responsible Sourcing of Minerals |
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C Organizational structure |
Our businesses - Our structure in 2018 |
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D Property, plant and equipment |
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Provisions - Environmental provisions |
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Contingent assets and liabilities - Contingent liabilities - Environmental remediation |
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4A |
Unresolved staff comments |
Not applicable |
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5 |
Operating and financial review and prospects |
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A Operating results |
Performance review - Management summary |
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Performance review - from 6.1.1 to 6.1.5 |
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B Liquidity and capital resources |
Performance review - from 6.1.1 to 6.1.5 and 6.1.10 |
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C Research and development, patents and licenses, etc. |
Results of operations - Research and development expenses |
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D Trend information |
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Strategic risks- First & second paragraph |
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E Off-balance sheet arrangements |
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F Tabular disclosure of contractual obligations |
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G Safe Harbor |
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6 |
Directors, senior management and employees |
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A Directors and senior management |
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Board of Management and Executive Committee - Introduction |
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Board of Management and Executive Committee - (Term of) Appointment, composition and conflicts of interest |
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Supervisory Board - (Term of) Appointment, composition and conflicts of interests |
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B Compensation |
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C Board practices |
Board of Management and Board of Management and Executive Committee |
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Meeting logistics and other information - Internal controls and disclosure policies |
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Meeting logistics and other information - Auditor information |
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D Employees |
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Income from operations - Employees |
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E Share ownership |
Board of Management and Executive Committee - Amount and composition of the remuneration of the Board of Management |
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7 |
Major shareholders and related party transactions |
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