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Novartis’s Adjusted Earnings per Share Declined 7% in 2Q15

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2Q15 earnings performance

Novartis (NVS) posted its 2Q15 earnings on July 21, 2015. The company achieved adjusted earnings per share (or EPS) of $1.27 for 2Q15, which is ~7% lower than its EPS of $1.36 for 2Q14. The company’s EPS has surpassed Wall Street analysts’ estimates for the last three quarters. Novartis registered adjusted net income and operating income of $3,074 million and $3,593 million, down by ~3.9% and ~1.6%, respectively, from 1Q15 figures.

Novartis competitor Johnson & Johnson (JNJ) released its 2Q15 financial results on July 14, while Pfizer (PFE) and Merck & Co. (MRK) will release their 2Q15 results on July 28, 2015.

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Key highlights of 2Q15

Here are some of Novartis’s highlights for 2Q15:

  • a 24% rise in growth products to $4.4 billion, which is ~35% of net sales
  • strong performance in emerging growth markets
  • approval and launch of Entresto for chronic heart failure with reduced ejection fraction in US markets
  • approval and launch of Glatopa, the first generic competitor to Copaxone 20mg, in US markets
  • strong performance for Sandoz and pharmaceuticals with an increase in net sales by 11% and 6%, respectively, at constant currencies
  • weak performance for Alcon with no change in net sales at constant currencies

Company overview

Novartis (NVS) is one of the largest pharmaceutical companies by revenue and is headquartered in Basel, Switzerland. The company specializes in research, development, manufacturing, and marketing of a broad range of healthcare products. The company deals in both prescription drugs as well as over-the-counter drugs. Read Market Realist’s company overview of Novartis for more information.

Investors who would like to divest risk might consider the Vanguard FTSE All-World Ex-US ETF (VEU), which has invested about 1.22% of its total assets in Novartis (NVS). Investors can also consider the Health Care Select Sector SPDR ETF (XLV), which is focused on pharmaceuticals and healthcare companies.

Overview of this series

At Market Realist, we believe knowing more about a company helps investors make better investment decisions. Our earnings reviews will help you understand growth or declines in EPS, revenue drivers, and key product growth. We’ll also look at Novartis’s strategic changes, as well as tactics that management discussed during its 2Q15 earnings call.

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