In the previous part of this series, we discussed the segment-wise financial performance for each of Sanofi’s (SNY) business segments. In this article, we’ll discuss the overall financial performance of Sanofi in 2014.
Sanofi’s net revenues increased by ~2.5% to 33.8 billion euros in 2014, as compared to $23.2 billion in 2013. The exchange rates had a negative impact of ~2.4% on the revenues, mainly due to depreciation of the Japanese yen, the Russian ruble, the Brazilian real, and the Argentinean peso against the euro. In terms of segments, the human vaccines segment saw the highest growth at ~6.9%, followed by the animal health segment’s ~4.6%, and the pharmaceutical segment’s ~1.7% growth in 2014.
Overall, the gross profit margins were 68.3% in 2014, a 0.6% improvement over 67.7% in 2013, while the gross profit margins were ~71.1% in 2012. The cost of sales were 11.0 billion euros in 2014, ~11.0 billion euros in 2013, and ~11.1 billion euros in 2012.
The R&D (research and development) expenses were 4.8 billion euros in 2014, as compared to 4.7 billion euros in 2013 and 4.9 billion euros in 2012. The R&D expenses represented 14.3% of net sales in 2014, as compared to 14.5% of net sales in 2013 and 14.0% in 2012.
The selling and general expenses increased 5.9% to 9.1 billion euros in 2014, as compared to 8.6 billion euros in 2013 due to an increase in the promotional spending. These expenses were 8.9 billion euros in 2012.
The operating income improved by 2.7% as a percentage of sales to 6.1 billion euros in 2014 as compared to 5.1 billion euros in 2013, mainly due to lower amortization charges and impairment of intangible assets. The company’s operating income was 6.4 billion euros in 2012.
The Health Care Select Sector SPDR ETF (XLV) is focused on pharmaceutical companies and includes investments of ~9.5% in Johnson and Johnson (JNJ), ~7.3% in Pfizer (PFE), and ~5.7% in Merck and Co. (MRK).