The stable outlook on Philips reflects our view that its operating performance and free cash flow generation should remain solid over the next two years. We anticipate comparable revenue growth to be around 3.5%, notably due to increased new orders in diagnosis and treatment and connected care while we see personal health decelerate slightly. The large cost-savings program should support profitability until 2020. At the current rating level, we forecast Philips maintaining a debt-to-EBITDA ratio of about 2.5x and a fund from operations (FFO)-to-debt ratio of 35%-45%. We could lower our ratings on Philips if we see declining operating performance over the next two years, driven by a loss of market share in personal health and diagnosis and treatment segments,
