Philips Healthcare

Healthcare

Philips Healthcare Businesses1

Imaging Systems Home Healthcare Solutions Patient Care and Clinical Informatics Customer Services Western Europe

Geographies1
North America Other Mature Geographies Growth Geographies2

38%

15%

22%

25%

19%

44%

13%

24%

10.0
Billion sales in 2012
1 2

37,000+
People employed worldwide in 100 countries

8%
of sales invested in R&D in 2012

450+
Products & services offered in over 100 countries

Last twelve months March 2013 Growth geographies are all geographies excluding USA, Canada, Western Europe, Australia, New Zealand, South Korea, Japan and Israel Note - Prior-period financials revised for discontinued operations, the adoption of IAS19R,and for restatements included in the Annual Report 2012 (please refer to the Annual Report Confidential Sector, MMMM dd, yyyy, Reference section 12.10 Significant Accounting Policies)

Key products and services of Philips Healthcare

Providing comprehensive support

Philips Healthcare Businesses Businesses

Imaging Systems Home Healthcare Solutions Patient Care and Clinical Informatics Services

Interventional X-Ray Diagnostic X-Ray CT MR SPECT/CT PET/CT Ultrasound Womens health

Sleep disordered breathing Home Respiratory care Home monitoring

Patient monitoring Clinical informatics Cardiac resuscitation ECG solutions Ventilation

Site planning and project management Ambient experience Education Performance services Maintenance

CONFIDENTIAL

We are a global healthcare leader

Innovating. Driving the market. 2005 2006
Intermagnetics Witt Stentor XIMIS EMERGIN

2007
VMI

2008
Dixtal Biomedica VISICU

2009
Meditronics Goldway Alpha

2010
Wheb Sistemas Tecso Informatica

2011

Global footprint
Aggregating technologies

Our foundation

Expanding care settings

Lifeline Healthwatch Respironics Raytel Interactive Medical Dev. Medel Tomcat Traxtal Innercool Apex Somnolyzer SEM PACS

Dameca
All Parts Medical Sectra medSage

* Strategic acquisitions since mid-September 2007 until January 2012

Understanding where the stakes are highest

Chronic disease is rising

Without action, almost 400 million people will die from chronic diseases in the next 10 years
Dr. Catherine Le Gals-Camus, WHO Assistant Director-General, Non-communicable Diseases and Mental Health

Projected global deaths from select causes, in millions

12 10 8

Cancers Ischemic heart disease

Stroke

6
4 2 2005
CONFIDENTIAL

Perinatal

HIV/Aids

2015

2030

Focusing where we can provide the most value

Home Healthcare Home Healthcare is improving the quality of life for at-risk individuals while easing the burden on the Healthcare system and lowering the overall cost of care. Cardiology and Oncology Focusing in these two key areas, will ensure that we battle two of the most critical and pressing healthcare issues.

Womens Health These conditions and diseases are often different in women. Understanding these differences is critical to effective diagnosis and treatment.
CONFIDENTIAL 10

The Philips Healthcare difference

People focused

Care cycle driven

Care anywhere

Meaningful innovation

CONFIDENTIAL

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Leading the way

Transforming care today and tomorrow

Today
Imaging Early and confident diagnosis

Tomorrow
Image guided intervention and open source approach Advanced visualization while helping minimize patient side effects. Clinical Decision Support Tools based on an understanding of disease pathways and user insights

Clinical IT Right information at the right time

Lifecycle services Optimizing your equipment and training your staff

Partnership solutions Customized services and healing environments for improved efficiency, staff performance, and patient care Care everywhere Monitoring and management, wherever a patient goes

Home Healthcare Improving the quality of life for at-risk patients in the home

CONFIDENTIAL

The Philips approach is different

Providing support

Focused on the patient

Focused on the clinician

Focused on the administrator

- Supporting faster, more confident diagnosis - Improving patient satisfaction and experience - Increasing comfort and decreasing stress for the patient and family
CONFIDENTIAL

- Supporting better patient care - Enabling more focused time with patients and more time on disease management - Increasing job satisfaction

- Supporting improved quality of care - Increasing equipment utilization - Improved revenue cycle - Reducing costs throughout the system

Key takeaways
We are driving profitable growth and delivering on our commitments Health care industry is dynamic, growing, and profitable Health care systems are transforming and our innovations address the trends Accelerate! is driving customer centricity, operational excellence, and a growth and performance culture We are on track to meet our 2013 targets
2

Our focus 2012

Accelerate! profitable growth
Grow faster than the market Increase presence in profitable growth geographies Leverage the 82 new 2011 product introductions Expand our value offering and locally relevant services Deliver return on investment on 1,200 new customerfacing roles

Create value through innovation

Extend leadership in PCCI Grow Image-Guided Intervention and Therapy solutions Advance innovation in dose, HIFU, and mixedmodality technologies Design for cost by leveraging value engineering Build on Hospital to Home opportunity Grow clinical consulting

Drive operational excellence through Accelerate!

Streamline customer value chain Simplify End2End IT platforms Deliver performance, reward performance Reduce overhead and cost of complexity Leverage industrial footprint in growth geographies

We fulfilled our 2012 commitments

Accelerate! profitable growth
Gained or maintained market share in 60%+ business market combinations In growth geographies, revenue share increased from 22% to 24% Sustained rate of new product introductions in 2012 20 value products and services in 2012 Grew revenue 6% and adjusted EBITA 24% y-o-y
4

Create value through innovation

Patient Monitoring market share increased to 47% HIFU: First breast cancer patient treated in clinical trial Hospital to Home unit created; Banner, First Health pilots Hired clinical consulting leader; large deals include workflow, design, education, and analytics

Drive operational excellence through Accelerate!

8% total revenue covered by End2End programs Structural cost reduction measures including removing two layers Doubled resources in value engineering Industrial output doubled in growth geographies

2012 performance with strong rebound in underlying EBITA profitability

13.6% 12.2% 12.4% 12.3%

2011 Restructuring 2011 Growth Operational (1) EBITA Adjusted efficiency EBITA (1,2)

Overhead cost reductions

Investments

2012 Restructuring Adjusted EBITA (1,2)

2012 EBITA (1)

1 EBITA restated to account for IAS 19R pension restatements from 2009 - 2012 2 Adjusted EBITA excludes restructuring and acquisition related costs

Health care industry dynamics will drive demand

Sharp rise in incidence of chronic disease and non-communicable lifestyle diseases Globally, 36 million of the 57 million deaths are due to chronic and noncommunicable disease Approximately 80% of non-communicable disease deaths29 millionoccur in growth geographies An aging population Worlds population of people 60 years+ has doubled since 1980 and is forecast to reach 2 billion by 2050 Access to care and clinician shortage Recognized as one of the main obstacles to delivery of effective health services
Causes of death globally (2008)

Deaths from all other causes million

21

Deaths from chronic Growth and non-communicable Geographies million diseases

36

80% geographies
World population age 60+ (Millions)
2000 1500 1000 500 0 1980 2010

occur in growth

2050 (Est.)

Source: World Health Organization data and statistics http://www.who.int/gho/ncd/mortality_morbidity/en/index.html, http://www.who.int/features/factfiles/ageing/en/index.html, and http://www.who.int/workforcealliance/media/qa/01/en/
6

Transforming health care landscape provides opportunity for innovation

Innovative, minimally invasive therapies Enables shorter lengths of stay, faster recovery, improved outcomes, and lower cost treatment Data, information, and connected solutions across the care continuum Bring together solutions across the ecosystem to help diagnose disease, improve adherence to protocols, and improve clinical outcomes Improve quality of care at a lower cost Consulting solutions with value products improve clinical workflow, improve health system effectiveness, and lower costs Extending into lower cost settings including the home Lower risk of hospital-borne illness, patients comfortable at home, reducing the cost of care Wellness and preventive care Empower individuals to take care of their health and help people stay healthy

Dynamic markets provide opportunities for profitable growth

North America
Flat growth Long-term fundamental demand drivers remain Short-term uncertainties ~30M+ new patients in health payments systems Focus on information integration, lower cost care settings, including the home

Europe
Flat to low-single-digit growth Pent-up demand remains Mixed outlook in the short term: Positive in Northern Europe. Southern and Eastern Europe remain weak Multi-year solution-oriented deals

Greater China
Double-digit growth Government investments in rural health care, equipment upgrades, and medical insurance Opportunities in home health and clinical informatics Collective purchasing provides opportunity for solution selling

Latin America
Mid-single-digit growth Public spending recovering Private spending increasing Advanced clinical informatics to manage workflow

Middle East, Turkey, Asia-Pacific Russia, Central Asia, Africa Double-digit growth in India and
Double-digit growth Very strong double-digit growth in Africa Government investment continues Southeast Asia Government and private investment in building health care systems Mid-single-digit growth in Japan with government stimulus Focus on home care in Japan

Blue = 2013 market growth

Global market growth 3-4%

Philips Healthcare Guiding Statement

We are dedicated to creating the future of health care and saving lives. We develop innovative solutions across the continuum of care in partnership with clinicians and our customers to improve patient outcomes, provide better value and expand access to care.

Minimally invasive therapy replaces open-heart surgery

Innovation example: EchoNavigator
Simpler, more accurate, minimally invasive intervention and therapy for aortic valve replacement A unique strength: Aligns 3D ultrasound and X-Ray images, enables echo cardiographers to identify and mark anatomic targets Enables new clinical procedures, more effective treatment methods, and improved access to care Lowers costs through faster recovery and shorter length of stay

10

Predict adverse patient events

Innovation example: Respiration Patch and Guardian Software
Newest innovation in IntelliVue patient monitor Predicts adverse patient events, improves patient outcomes Monitors patient respiration rate, pulse, activity, and posture Wireless transmission to clinical informatics where patient data is trended Put on in the emergency department, worn throughout hospital stay and at home Drives adherence to protocols and improves workflow

11

Ensures patient compliance

Innovation example: EncoreAnywhere
Ensures sleep-disorder patient compliance via a Web-based management system Records patient therapy data, scores, treatment history Allows collaboration among patients network of care providers Enables providers, patients, families to see progress Gives providers patient compliance documentation for reimbursement Four million lives on the system

12

Lighting solutions create a healing environment

Phoenix Childrens Hospital

13

Strong market and satisfaction leadership positions

Imaging Systems
# # # #

Patient Care and Clinical Informatics

# # # # #

Home Healthcare Solutions

# # #

Interventional X-Ray cardiovascular Image-Guided interventions Ultrasound worldwide Overall system performance IMV ServiceTrak CT MDBuyline MR Ingenia and Ultrasound iU22 Best in KLAS NPS Interventional X-Ray-India, North America, Japan, and China NPS Ultrasound-North America, United Kingdom, and China

1 1 1

Patient monitoring AEDs Digital telemetry Non-invasive ventilation Enterprise Imaging North America and LatAm Cardiology Imaging North America Clinical Informatics Brazil NPS Patient Monitoring-North America, United Kingdom, Germany, China, and India NPS PCCI-global

1 1 1

Sleep therapy Respiratory care Home monitoring telecare North America

2 1 1 1 1 1

1 1 1 1 1 1

# #

Source: National benchmarks, COCIR, NEMA, GSS Market Intelligence Estimate, IMV rated ServiceTrak, Frost and Sullivan, HHS TBS, PCCI market insight. Market Size data excludes Customer Service

= Market position = Customer satisfaction

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monitored with Philips patient monitors 190 million+ last year

190 million+ patients

4 million+ people

patients

sleep and breathe easier using our sleep aids

840,000 patients

monitored with Philips patient monitors last year

charted per year via IntelliSpace Critical Care software archived, comprising 10 petabytes of storage

390 million enterprise imaging studies

500 Ambient Experience

installations globally enhance patient experience

1 million+ AEDs

save lives in malls, schools, airports throughout the world

40 million babies

come into the world every year with our fetal monitors

We make a difference to millions of people across the continuum of care

15

Accelerating Healthcare: Driving operational excellence

Customer Centricity Resource to win End2End
Expand our value offering and locally relevant solutions Upgrade marketing capabilities Innovation investments in Hospital to Home, Image-Guided Intervention and Therapy, Clinical Informatics, Value Segment, and Enterprise Consulting Market investments in China, Latin America, India, and ASEAN Three-fold increase in total revenue covered by End2End programs in 2013 Home Healthcare, CT, Patient Monitoring, Clinical Informatics, Interventional X-Ray, Ultrasound Improve time-to-market of new solutions supported by clinical evidence Create a growth and performance culture around customer centricity, innovation, inspiration, and operational excellence 72% of Healthcare leaders trained in Accelerate Leadership Program Realigned Business Group structure from 40 business lines to 10 Business Innovation Units, and formed four Lean Market Groups to support our 17 Markets Simplified organization, increasing spans of control and removing two layers Improve sales force productivity with Sales Support Centers, Customer Relationship Management system, and digital tools 16 16

Culture Operating model

Progressing on our Path-to-Value

Growth

Value

Growth

2011 Performance
EBITA

Growth

2012 Performance
EBITA

2013 Performance
EBITA

Strong OIT and sales growth Successful market launches Investments in R&D and growth geographies Industrial footprint in growth geographies Strategies to address market

Setting the foundation to improve performance

headwinds in Southern Europe and Japan Kick-off Accelerate!

Drive operational excellence through Accelerate! Deliver return on investment on growth and innovation investments Reduce overhead, cost of complexity Leverage industrial footprint in growth geographies Gain share, extend leadership in
Patient Care and Clinical Informatics Drive international growth and improve patient interface market position in Home Healthcare Solutions

Accelerating performance improvement

Transform Philips through Accelerate!

Value delivery from past acquisitions Upgrade marketing capabilities Improve sales force productivity Create performance and growth culture Increase value segment portfolio in Imaging Continue to close gap in co-leadership in Imaging Grow consulting services business

= Areas of ongoing focus in 2013

17

Philips Healthcare: Businesses and Markets

Businesses
Imaging Systems Patient Care and Clinical Informatics Home Healthcare Solutions Customer Services Americas

Markets
Asia-Pacific Greater China Europe, Middle East, Africa

Gene Saragnese

Mike Mancuso

Brent Shafer

Michael Dreher

Steve Laczynski

Arjen Radder

Desmond Thio

Bas Verhoef

38%

22%

15%

25%

49%

16%

9%

26%

10B
Sales in 2012

37,000+
People employed worldwide in 100 countries

8%
of sales invested in R&D in 2012

450+
Products and services offered in more than 100 countries

FY 2012

18

Key takeaways
We are driving profitable growth and delivering on our commitments Health care industry is dynamic, growing, and profitable Health care systems are transforming and our innovations address the trends Accelerate! is driving customer centricity, operational excellence, and a growth and performance culture We are on track to meet our 2013 targets

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