Novartis: Q2 Earnings Drop Less Than Expected

Sales were hurt by the rising U.S. dollar and generic competition

   

Novartis: Q2 Earnings Drop Less Than Expected

Swiss pharmaceutical giant Novartis (NYSE:NVS) said its second-quarter adjusted earnings dropped 6% to $3.36 billion, down from $3.56 billion during the same time last year.

Adjusted EPS for the quarter was $1.38, down from $1.48 in 2011, but beating analysts who had predicted $1.33, Bloomberg noted.

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The company said sales for the second quarter slipped 4% to $14.3 billion, which matched Wall Street estimates.

Novartis officials attributed the earnings slump to stronger competition from generic drugs and the negative currency exchange rates resulting from a rising U.S. dollar. The dollar’s strength trimmed sales revenue by 5% during the quarter.

Consumer health product sales dropped 24% to $904 million, compared to last year. Quality-control problems led the company to suspend production at its Lincoln, Neb., facility in January. The plant is expected to resume production by the fourth quarter.

Pharmaceutical revenues slid 1% to $8.3 billion. Novartis’ blood pressure medication Diovan will see its patent expire later this year and is already facing pressure from generics, causing its sales to fall 16% during the quarter.

But sales of Gilenya, a multiple sclerosis treatment, rose to $283 million, up from $79 million last year. Novartis expects Gilenya sales to hit $1 billion by year-end.

Shares of Novartis rose more than 1% in Thursday morning trading in New York.


Article printed from InvestorPlace Media, http://investorplace.com/2012/07/novartis-q2-earnings-drop-less-than-expected/.

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