3rd-qtr shows 11% core operating growth for Novartis, but profits down

27 October 2020

Shares of Novartis (NOVN: VX) dipped 1.5% to 75.19 Swiss France by late morning after the Swiss pharma giant posted third-quarter 2020 financial results, which showed higher sales but a downturn in profit, mainly due to legal provisions, according to the company, which settled a legal case where the French government fined it 385 million euros ($455 million) over abusive practices.

Based on continuing operations, net sales for the quarter were $12.3 billion (+1%, 0% constant exchange), driven by volume growth of 7 percentage points, offset by price erosion of 4 percentage points and the negative impact from generic competition of 3 percentage points. This missed the $12.7 billion consensus forecast.

Operating income was $2.4 billion (+2%, +9% cc) mainly due to lower spending, improved gross margin and gains on financial assets, partly offset by higher legal charges.

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