earnings reports

Novartis profits climb despite virus sales swings

Agence France-Presse, Agence France-Presse
Novartis' net profit comes in at $4 billion for January-June 2020, a 9% increase when currency fluctuations are stripped out

Swiss pharma giant Novartis reported on Tuesday, July 21, higher profits in the first half of the year despite the coronavirus pandemic causing swings in sales.

During the first 6 months of the year, net profit came in at $4 billion (3.5 billion euros), a 9% increase when currency fluctuations are stripped out.

Sales rose by 6% from the same period last year to $23.6 billion.

But the half-year figures obscure considerable swings in sales and profits due to the novel coronavirus pandemic.

If sales rose by 11% in the 1st quarter as clients stocked up on medicines when the virus began to spread around the world, sales dipped by 1% in the 2nd quarter.

“During the 2nd quarter, COVID-19 had an impact on our business with forward purchasing from the 1st quarter largely reversing,” the company said in a statement.

Lockdowns and the focus of medical systems on treating coronavirus and urgent patients also had an impact on the sales of certain treatments.

“Sales were mostly affected by lower new patient starts and significant reduction in patient visits to physicians,” said Novartis.

There was also a similar evolution in quarterly earnings, with a 16% gain in net profit during the first 3 months turning into a 4% drop in the 2nd quarter.

Novartis said it expects mid single-digit sales growth for the year, with a low double-digit gain in its measure of core operating income. Over the first half of the year, core operating income rose by 19%. – Rappler.com