Novartis AG, the Swiss pharmaceutical giant, has reported a net income of $8.48 billion for the fourth quarter, a significant increase from $1.47 billion the previous year. The company's earnings per share also saw a substantial rise from $0.69 to $4.14.
These recent outcomes included a net income from discontinued operations of $5.84 billion, primarily driven by the International Financial Reporting Standards (IFRS) accounting standards non-cash, non-taxable, net gain of $5.9 billion on the distribution of Sandoz Group AG to Novartis AG shareholders, compared to $151 million income during the same period of the previous year.
On the basis of continuing operations, the company registered a net income of $2.64 billion, marking a 101% increase from the previous year's $1.32 billion. The earnings per share saw a 108% growth from $0.62 to $1.29.
The company reported a core net income of $3.13 billion, compared to $3.25 billion last year. The core earnings per share were $1.53, slightly higher than the $1.52 in the previous year. During the same period in the previous year, the core net income from continuing operations was $2.96 billion, or $1.39 per share.
According to Thomson Reuters, analysts had predicted average company earnings of $1.68 per share. Typically, these estimates exclude unique items.
Net sales witnessed an 8% growth, climbing to $11.42 billion from the previous year’s total of $10.58 billion. On constant currency rates, this represents a 10% increase. The market had predicted sales of $11.75 billion for the quarter.
Furthermore, the Board of Directors at Novartis proposed a dividend payment of 3.30 Swiss francs per share for 2023, which suggests an increase of 3.1% from the prior year.
Looking forward, for the financial year 2024 Novartis predicts a mid-single-digit growth in net sales and a high single-digit increase in core operating income.
In addition, Novartis has updated its medium-term guidance. The company expects net sales to grow 5% at constant exchange rates (CAGR) during 2023-2028, with the core operating income margin expected to expand to approximately 40% by 2027.
