Tue, Jul 30, 2019 - Page 10 News List

Write-downs a bitter pill for Sanofi shareholders


French pharmaceutical giant Sanofi SA yesterday said it suffered a loss in the second quarter after it booked nearly 3 billion euros (US$3.34 billion) in write-downs of the value of its assets, but said it remained confident that net profit would rise for the year.

The net loss of 87 million euros came despite a 5.5 percent increase in net sales to 8.6 billion euros, which was slightly higher than the analyst consensus compiled by financial data firm FactSet Research Systems Inc.

The company pointed to a more than 20 percent jump in sales at Sanofi Genzyme, its bio-tech specialty care firm that it created following its 2011 acquisition of Genzyme Corp for 15 billion euros, thanks to a strong launch of Dupixent, a treatment for atopic dermatitis and asthma.

Gross profit rose by 7.6 percent in the first half to 12.3 billion euros, but write-downs to the value of its assets and restructuring charges weighed in at more than 3.7 billion euros.

Included in that was a 1.8 billion euro charge against hemophilia treatment Eloctate due to disappointing sales in the US, which fell by 11 percent on a comparative basis.

Nevertheless, chief executive Olivier Brandicourt said: “We are confident in the growth outlook for the year.”

The firm revised upward its forecast for full-year earnings per share to an increase of US$0.05 per share.

Sanofi shares advanced 2.3 percent after it raised its outlook for this year on the back of strong growth in its vaccines and rare diseases businesses.

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