Winning in light sources. René van Schooten

Transcription

1 Winning in light sources René van Schooten CEO Lamps business 94

2 Key takeaways The coming 5 years will bring significant opportunities We are uniquely positioned to capture the value in conventional light sources We have the strengths and strategy to win in LED light sources 95

3 Thecoming5 years will bring significant opportunities 96

4 Lamps market expected to grow significantly in next 5 years Global light sources market evolution Global light source revenue 1 Bln Macro economic environment and outlook have improved 15 Conventional market remains large opportunity while LED penetration is increasing in all segments and will fuel tremendous growth Conventional light sources LED Light sources 1.Excluding Automotive Source: Philips Lighting global market study 2009, updated for

5 LED penetration is increasing in all segments and will fuel tremendous growth Increasingly powerful drivers for LED adoption Global LED light sources market growing rapidly Continuously improving total cost of ownership e.g. parking lot s, road, corridor lighting Bln 12 Global LED light source revenue 1 Sustainability drive e.g. Life Cycle Assessment ( LCA ), US DOE Energy Star program, CO2 neutral hotels Differentiating experience e.g. productivity in the office, safety Increased availability and awareness Increased LED shelf space in virtually all big retail chains, increased A&P spent Government stimulus packages e.g. 10K city program in China Excluding Automotive Source: Philips Lighting global market study 2009, updated for

6 Conventional markets remain a large opportunity Key trends Increasing number of light points in emerging markets Mix improvement to higher priced more energy efficient light sources in mature markets Conventional light sources gradually replaced by LED light sources Global conventional light sources market declining gradually Bln 12 Global conventional light source revenue Excluding Automotive Source: Philips Lighting global market study 2009, updated for

7 We are uniquely positioned to capture the value in conventional light sources 100

8 Uniquely positioned to capture the value in conventional light sources Our building blocks Our unique position Global leader Building on our leading global market position to enhance our relationships with our customers Portfolio Pro-actively managing our portfolio to leverage legislation and drive up-selling Winning strategy Successfully growing and gaining share in consumer and professional markets Life cycle management Capturing opportunities while successfully managing the life cycle of our conventional assets 101

9 Building on our leading global market position to strengthen our relationships with our customers Leading position in light sources globally Strong position with our distribution partners No 1 light source company in the world. We have strong presence in consumer retail as well as with professional distributors with specific strengths in emerging markets India China Brazil Russia With leading customer Net Promoter Scores 2 : 83% outright NPS leadership 89% (co)leadership in NPS consumer 99% (co)leadership in NPS professional 1.Based on 2009 results for Philips Lighting Lamps. Excludes Japan. 2.NPS measurements cover 50% of markets by revenue. Data from Source: Customer panels and Industry associations 102

10 Pro-actively managing our portfolio to leverage legislation and drive up-selling Strategy Achievements Introducing innovative up- TL-D Powersaver Set in Europe saving 30% selling propositions energy over TL-D standard CDM Allstart in US, save 20% energy on road lighting versus Quarz Metal Halide Remote controllable compact fluorescent launched to consumers in Asia-Pacific and Europe Reducing Product Costs in Commodity categories Reduced Fluorescent product costs by 2-4% through phosphor re-engineering Simplifying portfolio impacted by legislation Year to date 2010 reduced number of SKU s in mature incandescent portfolio by more than 35% 103

11 Successfully growing and gaining share in consumer and professional markets Consumer markets Strengthened #1 market position in compact fluorescent in Asia Pacific through focused consumer marketing campaigns, growing share by 1.5% Continuing market share growth in energy efficient lamps in North America Winning GLS ban in EU27: Philips strengthened market leading position in EU27 growing market share by 2% Rebuilt 55km of shelves in over 19,500 major stores to promote energy saving lamps Professional markets Philips ceramic white light outdoor lamps specified for City of Chicago This month milestone reached of the 1,000,000 th Cosmopolis lamp sales Ceramic lamps sales level all time high with 42% growth YTD (China: 62% growth) Growth of T5 Eco and Energy advantage > 100% Key end-users worldwide switching to T5 Eco, e.g. Tesco, M&S, The Home Depot 104

12 Capturing opportunities while successfully managing the life cycle of our conventional assets YTD (1) 28 (1) We have a clear strategic roadmap for our required industrial footprint, based on market trends and controlled closures: From 2002 to 2009, we have closed 8 incandescent operations, 2 fluorescent tube operations and 3 other lamps operations (2) In 2010 YTD we closed another 2 incandescent operations and 2 fluorescent tube operations (2) Our remaining production facilities for conventional technologies are selected based on key control points (e.g. glass on site), cost leadership (e.g. scale, low wage) and proximity of markets We will retain flexibility to facilitate market share gains Notes: 1) Indicates the number of geographical industrial locations at the end of the year 2) Please note that 1 industrial location may include several technology production operations 105

13 We have the strengths and strategy to win in LED light sources 106

14 We have the strengths and strategy to win in LED light sources Our building blocks Our unique position Lumileds Lumileds adding value in our LED value chain LED lamps Building on our strong position in lighting TLED Leveraging our control points LED systems Using our applications knowledge and scale 107

15 Lumileds adding value in our LED value chain Our strengths Leader in LED technology Expanding in illumination segments Operational excellence Achievements Superior lighting quality through Lumiramics technology Designed into majority of our current LED Lamps portfolio Growing customer base in indoor and outdoor illumination using LUXEON Rebel as the Power LED solution Strong increase in illumination revenue and design-in wins Aggressive cost down through technology and process improvements Ability to comply py with strict industry standards (e.g. automotive) Strong distribution partnership Exclusive relationship with Future Lighting Solutions a leading provider of LED lighting components and support services 108

16 Building on our strong position in lighting to win in LED lamps Our strengths Achievements Using distribution power and brand leadership Teaming up with leading distributors around the world like Sonepar, Rexel and Grainger to jointly drive market development Broad LED portfolio to cater the varied needs of our customers More than twice as many DoE approved products with Lighting Facts certificate than runner up. Leading the innovation in LED lamps Being first and still only submitter of DoE L-Prize contest. Sept 2010: launch of 1 st 60W incandescent equivalent in Europe and NA Strong value chain partnerships Establishing global assembly blue-print with leading contract manufacturers such as Elcoteq to address market needs of all regions 109

17 Leveraging our control points to win in TLED Our strengths Achievements Strong foothold in TL applications world wide ( beacon of trust ) Strong IP positions Significant wins with leading retailers in Indonesia and Singapore e.g. HERO Giant hypermarket Indonesia Industry leading patent portfolio in TLED technology Structural cost advantages in TLED Comprehensive heritage of all aspects of TL production including world (cost-volume) leadership in glass tube manufacturing and superior glass and phosphor processing expertise Aggressive costs down First general lighting products in the market in applications with attractive TCO 2 year pay-back projected for high volume applications in

18 Using our applications knowledge and scale to win in LED systems Our strengths Achievements Leveraging our Brand and distribution strength in OEM channel In Europe, 124 OEMs have designed in our Fortimo modules. North America and Asia are following suit Platform approach to drive scale and cost down Fortimo family based on LED platform with Fortimo Twist as low cost derivative Leveraging our deep application knowledge to serve our customers Developed roadmaps and launched LED systems specific for Office, Outdoor and Retail segment. Leading the industry in standard setting initiatives Founding member of Zhaga consortium that aims to standardize module interfaces. The consortium selected Philips Fortimo Twist as the first platform to standardize. 111

19 Winning in consumer and professional markets Consumer markets Professional markets We are launching a new, differentiated LED lamps portfolio in the consumer channel in Europe Major retailers like Tesco and Ahold are converting freezers over to Philips Freezer Lights We are increasing our Advertising and Promotion efforts to accelerate the consumer market development. We are leveraging our multi- channel retail distribution across the world. Philips is number 1 player with LED Lamps in hospitality segment. Key hotel brands with Philips LED Lamps installed: Hilton, Ibis, Novotel, Marriott, Sheraton, Crown Plaza Philips will supply all of the LED drivers in Los Angeles LED street lighting project. 112

20 Key takeaways The coming 5 years will bring significant opportunities We are uniquely positioned to capture the value in conventional light sources We have the strengths and strategy to win in LED light sources 113

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