February 9, 2018

Philips to invest in diagnostic imaging R&D center of excellence and global customer and service training hub in Cleveland

Amsterdam, the Netherlands – As part of the company’s commitment to innovation with an annual USD 600 million R&D spend in North America, Royal Philips (NYSE: PHG, AEX: PHIA) today announced that it will invest in a new R&D facility in Cleveland, Ohio, for its Computed Tomography and Advanced Molecular Imaging (CT/AMI) businesses.

The company will also invest to enhance its Cleveland facility to optimize its learning environment for the thousands of Philips field service engineers and for customers from across the globe, to meet the growing demand for technical and clinical training.

In conjunction with the decision to focus more on innovation and customer services, the Cleveland diagnostic imaging manufacturing operations, which currently make up less than 3% of the total global diagnostic imaging sales volume, will fully cease in the second half of 2018.

“Philips is well underway to step up the long-term success of its diagnostic imaging businesses,” said Rob Cascella, Chief Business Leader of the Diagnosis and Treatment businesses at Royal Philips. “With these investments, we will accelerate innovation in advanced diagnostic imaging at our Cleveland center of excellence and further enhance our customer services.”

About Royal Philips

Royal Philips (NYSE: PHG, AEX: PHIA) is a leading health technology company focused on improving people's health and enabling better outcomes across the health continuum from healthy living and prevention, to diagnosis, treatment and home care. Philips leverages advanced technology and deep clinical and consumer insights to deliver integrated solutions. Headquartered in the Netherlands, the company is a leader in diagnostic imaging, image-guided therapy, patient monitoring and health informatics, as well as in consumer health and home care. Philips' health technology portfolio generated 2017 sales of EUR 17.8 billion and employs approximately 74,000 employees with sales and services in more than 100 countries. News about Philips can be found at www.philips.com/newscenter.

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Forward-looking statements

This release 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. Examples of forward-looking statements include statements made about the strategy, estimates of sales growth, future EBITA, future developments in Philips’ organic business and the completion of acquisitions and divestments. 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.

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