Annual Results 2004

• January 27, 2005

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• Founded in November 1998, based in Brisbane, CA

• Picture Archiving and Communications Systems (PACS)

• A unique technology and service model

• 50 % on-going and projected growth rate

• 11% unit share of new PACS installations in 2004 in North America

• #1 in Customer Satisfaction 2003, 2004 and mid-2005

• >200 installations in >100 healthcare institutions in North America

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Philips Medical Systems in 2004

Medical IT

Patient Monitoringand Cardiac Devices

Document services

Medical IT

Patient Monitoringand Cardiac Devices

Document services

Imaging SystemsEUR 2.8 bln

Nuclear Medicine

CT

MR

PET

Ultrasound

X-Ray

Nuclear Medicine

CT

MR

PET

Ultrasound

X-Ray

Consultancy

Clinical services

Asset management

Maintenance& Repair

Consultancy

Clinical services

Asset management

Maintenance& Repair

Information and Monitoring Solutions

EUR 1.5 bln

Customer ServicesEUR 1.6 bln

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Focus on the Care Cycle

Information &Decision supportOperating room

MonitoringImaging

Operating roomMonitoringImaging

IntensiveCare unitMonitoring

IntensiveCare unitMonitoring

Step downfacility

Monitoring

Step downfacility

Monitoring

HomeMonitoring

HomeMonitoring

Pre-Hospital/Ambulance

Monitoring

Pre-Hospital/Ambulance

Monitoring

DiagnosticsImaging

DiagnosticsImaging

Treatment

Follow Up

Diagnostics

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Why ?

• Unique – and proven - customer experience - #1 by KLAS in 2003, 2004 and mid-2005

• Unique Technology with access to full detail of clinical images anytime, anywhere – faster and at lower cost

• Strong team with strong leaders who are eager to multiply the business within Philips

• A shared vision of the future• Strong market, clinical and technology synergies• Strong combined market position #2 to start with

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Philips Radiology IT Solutions

A comprehensive radiology IT portfolio

EasyRIS

Xtenity RIS (USA)

Scheduling,worklist

management

Workflow management, image review and reporting

ViewForum &Advanced Clinical

Applications

Multi-modality image viewing and processing

Philips iSite Enterprisedistribution

Web-enabled cost-effective

informationdistribution

Philips iSite Radiology

PACS

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Benefits of PACS

Management of radiology:• Cost reduction

• More examinations per modality

• Better service to referring physicians

• Standardization of work processes

• Control of workflow

• Automated billing

• Management information

Radiologist:• Increase productivity

• More accurate diagnostics

• Less disturbance by referring physicians

• Handling of MR and CT examinations

• Tele-consult colleagues

• Work from home

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Over 1600 PACS systems for Radiology and/or Cardiology installed worldwide!Dots give indication of installation of one or more Radio and/or Cardio PACS system

Philips’ and Stentors’ combined worldwide presence and installed base

North America, Europe and

Japan Account for 80% of the total market

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IT in Healthcare = Infrastructure IT + Healthcare IT

Healthcare IT = Enterprise IT + Clinical IT/PACS

Healthcare IT is:• very fragmented (1200+ companies)• a $ 26 Bln market (USA 70%)• with an average growth 11%/year

Clinical IT/PACS: PACS, Workstations, Clinical Applications, Decision Support, Monitoring related IT products: Many Philips Medical Systems products

Enterprise IT: Clinical Data Repository, CPOE, EMR andDepartmental IT: RIS, CVIS, etc.:Philips Xtenity powered by Epic

Infrastructure IT: IT Hardware, Op. Systems,Networks, Office Desktop. Outsourced infrastructure: Reseller agreements

Consulting: Business Processing Re-engineering (BPR), Institutional Transformation: Alliance Programs

Consulting

Infrastructure IT

Enterprise IT

Clinical IT/PACS

Imaging & Monitors

$35.7 Bln

$23.8 Bln

$2.4 Bln

Total IT in Healthcare $62 Bln (USA 50%) in 2004

Healthcare IT Market

Source: CapGemini U.S., DeLoitte, Gartner

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Global Radiology and Cardiology PACS market

Source: Frost & Sullivan 2004

Global PACS market 2004E: $ 1.8 Bln Growth 9% per year

26%

18%

10%9%9%

8%

7%

6%

7%

GE

Philips+Stentor

Siemens

Fuji

Agfa

McKesson

Emageon

Amicas

Others

US Market share Radiology PACS 2004 in units

06-July-05 11

Enterprise ITClinical IT PACS Imaging Monitoring

GE

Siemens

Film Companies

HIT Companies

Niche Players

Strengthen our competitive positionBy completing our portfolio

Stentor iSite

Philips BEST in CLASS in all major categories

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iSite fits in the complete Vequion portfolio

PACS

Clinical ITPACS

Intgris Allura

Imaging Modalities, Monitoring

Xtenity

Enterprise IT Powered by Epic

Guaranteeing a consistent UI and full interoperability

Annual Results 2004

• January 27, 2005