Swiss drug major Novartis has seen its net income decline by 991 per cent to $1.47 billion in the fourth quarter, compared to $16.31 billion in 2022.
The company reported on Wednesday.
Earnings per share stood at $0.69, down from $7.29 a year ago.
The profit drop reflects the absence of income from Swiss multinational health care company Roche, of $14.6 billion in 2022.
Novartis held about a third of Roche shares before agreeing to sell back in 2021, excluding the impact of Roche income, net income grew 2 per cent at constant currencies.
Core net income was $3.25 billion or $1.52 per share, compared to $3.14 billion or $1.40 per share last year.
On average, five analysts polled by Thomson Reuters expected earnings of $1.44 per share for the quarter. Analysts’ estimates typically exclude special items.
However, core operating income increased by 6 per cent to $4.03 billion, from prior year’s $3.82 billion.
Net sales were $12.69 billion, down by 4 per cent from last year’s $13.23 billion.
Meanwhile, sales grew by 3 per cent in constant currencies; Analysts expected sales of $13.13 billion for the quarter.
The sales reflected volume growth of 10 percentage points, as well as price erosion and the negative impact from generic competition.
Further, Novartis’ Board of Directors proposed a dividend payment of 3.20 Swiss francs per share for 2022, up to 3.2 per cent from the prior year.
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Shareholders will vote on this proposal at the Annual General Meeting on March 7.
Looking ahead for fiscal 2023, the company expects sales to grow in low-to-mid single digit and core operating
income in the mid single digit, assuming the company’s generics business Sandoz would remain within the Group for the entire year.
Last summer, Novartis announced its intention to turn its Sandoz unit into a standalone business.
Excluding Sandoz, the company’s sales would grow low-to-mid single digit and core operating income would grow
mid-to-high single digit.
Regarding the planned Sandoz spin-off, Novartis said the plan remains on track for the second half
of the year.
