Progress in Ultrasound. Barbara Franciose Business Group Ultrasound
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1 Progress in Ultrasound Barbara Franciose Business Group Ultrasound
2 Ultrasound is exciting and growing 2
3 Ultrasound at Philips Medical Ultrasound Clinical Procedure and Market iu22 - new Ergonomics and clinical innovation Integration and Optimized Processes Why we Win - Future Growth in Asian low-end and Regain Market Share in Premium 3
4 Unique in Mobility.. Ultrasound is used within Radiology, Operating rooms, Emergency Rooms, Cardiac Cath Labs, Doctor s offices Very little entrance barriers in developing countries 4
5 Ultrasound procedure environment enables patient intimacy and interaction 5
6 With a strong consumer push.. NEMA reports a 19% OB/GYN Revenue growth in Q1 04 6
7 A Solution for Numbers Based Medicine. 7
8 Ultrasound Market grows 4-5% CAGR ( M)
9 2003 Ultrasound Market Segmentation Equipment Revenue ( M) Premium > 120K High-End 80K - 120K Mid-Range 40K - 80K Low-End < 40K 765M 26% 775M 26% 780M 27% 680M 21% Hearts and Vessels Card SS OB General Combination Body OB/GYN 675M 110M 750M 775M 465M 155M 23% 4% 26% 26% 16% 5% Total 3,000 M 9
10 Ultrasound at Philips Medical Ultrasound Clinical Procedure and Market iu22 - new Ergonomics and clinical innovation Integration and Optimized Processes Why we Win - Future Growth in Asian low-end and Regain Market Share in Premium 103
11 Philips Acquired Technology Leaders in General Imaging (ATL) and Cardiac (HP/Agilent) Customers say we have Best Image Quality 11
12 But hospitals now look for productivity and ergonomic / IT integrated solutions The historical HW/SW platforms were 8 yrs old 12
13 iu22 lots of customer productivity! " I just walked up and for the first time in memory, and just intuitively used the system. Dr. Eddie Leen, Leeds, UK 13
14 Single buttons now control > 100 parameters Allowing shorter exams and more throughput 14
15 With Better Image Quality for Physicians 15
16 iu22 released in March 2004 with great customer reviews Beverly Coleman, MD Director of Ultrasound Imaging University of Pennsylvania in Philadelphia, PA 16
17 Premium Segment brings Premium customer price and better product margins 17
18 Ultrasound at Philips Medical Ultrasound Clinical Procedure and Market iu22 - new Ergonomics and clinical innovation Integration and Optimized Processes Why we Win - Future Growth in Asian low-end and Regain Market Share in Premium 183
19 We needed to further integrate acquired companies operations and optimize processes A Major Ultrasound Change Initiative started early 2003 Consolidation of System Supply chain to one site Combined Commercial and Business SAP instance New Development Process more efficient New cross-segment, cross-platform innovation Better innovation with SGA/R&D reducing 2 pts. this year 19
20 Shrink our Image forming Electronics Electronics needed for image formation Compressed into Transducer Housing 20
21 Ultrasound New Product Revenues % Revenues based on products < 2 yrs old 66% 53% 26% 2% New product is defined as a product based on a new hardware platform or a product with a significant increase in functionality, or cost-per-function improvement 21
22 Ultrasound at Philips Medical Ultrasound Clinical Procedure and Market iu22 - new Ergonomics and clinical innovation Integration and Optimized Processes Why we Win - Future Growth in Asian low-end and Regain Market Share in Premium 223
23 Asia Pacific grows 2x rate rest of world APAC 8% CAGR 2003>2007 $3.500 Millions $3.000 $2.500 $2.000 $ $1.000 $500 $ Asia Europe N. America 23
24 Asia Pacific Targeted Product Sweet Spots Premium > 140K 120M 16% High-End 80K - 140K Product 1 135M 19% Mid-Range 40K - 80K Product 2 285M 40% Low-End < 40K Product 3 180M 25% Hearts 105M 25M 310M 140M General 110M 30M Card Combination Vasc SS Rad OB Other OB/GYN Total 15% 4% 43% 19% Body 15% 4% 720M 24
25 Market Share Gains within a Growing Market 30% 25% 20% 15% 10% 5% 0% Philips Ultrasound Market Share Target 25
26 Philips Ultrasound is. Part of a growing market, gaining share Responding to hospital s productivity pressures Will win with targeted innovation and reduced cost of Operations 26
27
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