The pharmaceutical giant now expects sales growth of a high single-digit percentage for the current year, excluding exchange rate fluctuations.
(Photo: Novartis)
Zurich The Swiss pharmaceutical company Novartis is more confident after the first six months and has again raised its forecast for the year. The Basel group confirmed on Tuesday that the Sandoz generics division should be spun off and listed on the SIX Swiss stock exchange. The shareholders are to vote on this on September 15 at an extraordinary general meeting.
Sandoz’s IPO should then go ahead at the beginning of the fourth quarter. In addition, Novartis is launching a new share buyback program with a volume of up to $15 billion.
“Novartis again delivered strong sales growth and robust margin growth in the past quarter, allowing for an increase in the Group’s guidance for 2023,” said Novartis CEO Vasant Narasimhan. The growth is broadly based on all therapeutic core areas and important regions. Excluding exchange rate fluctuations, the pharmaceutical giant now expects sales growth of a high single-digit percentage in 2023 instead of a mid-single-digit percentage.
Adjusted operating profit is expected to grow faster by a low double-digit percentage, after previously targeting a high single-digit to low double-digit increase. “Novartis’ robust balance sheet and future growth expectations allow us to launch a share buyback program of up to $15 billion,” said Narasimhan.
Sales revenue for the second quarter was $13.62 billion, a currency-adjusted 9 percent higher than a year earlier. Operating profit adjusted for special items rose 17 percent to $4.67 billion. Net income rose 54 percent to $2.32 billion.
There was little news about the Sandoz spin-off, which was announced almost a year ago, beyond the date of the general meeting and the somewhat more precise timetable. In addition to the listing in Zurich, the issuance of American Depositary Receipts (ADR) in the USA is also planned. Chief Financial Officer Harry Kirsch said a spin-off is in the best interests of shareholders. If a takeover bid for the business came, it would be examined.
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