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Inside Sanofi’s Revenues in 4Q16

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Sanofi’s revenues

Sanofi (SNY) is headquartered in Paris and thus reports its financial results in euros. Sanofi reported a sequential revenue growth of ~3.4% at constant exchange rates for 4Q16. The company reported revenues of 8,867 million euros, which is ~3.3% higher than 4Q15 revenues of 8.27 billion euros, which on February 17, equals about $8.77 billion.

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Reorganization of the group

Sanofi’s business is reorganized with effect from January 1, 2016, and now consists of five business units:

  • Sanofi Genzyme, the specialty care business including rare diseases and oncology
  • Diabetes and Cardiovascular
  • Generic Medicines and Emerging Markets, including pharmaceutical sales for emerging markets
  • Consumer Healthcare
  • Sanofi Pasteur, or human vaccines

Sanofi and Boehringer Ingelheim announced the completion of the exchange of Merial, Sanofi’s Animal health business and Boehringer Ingelheim’s consumer healthcare business in major markets on January 1, 2017.  Merial reported a growth of 6.8% at constant exchange rates to 599 million euros in 4Q16.

Segment-wise performance in 4Q16

Sanofi’s business is organized into the following business segments:

  • Pharmaceuticals (Sanofi Genzyme, Diabetes and Cardiovascular Franchise, Established Pharmaceuticals, Consumer Healthcare, and Generics)
  • Sanofi Pasteur (human vaccines)

The Pharmaceuticals segment revenues rose 3.4% sequentially to 7.5 billion euros in 4Q16. This segment is classified further into different franchises, including Genzyme, diabetes and cardiovascular, consumer healthcare, generics, and established prescription products. The increase in revenues was driven by the multiple sclerosis, cardiovascular, and rare disease franchises.

Sanofi Pasteur’s revenues rose 3.7% at constant exchange rates to 1.35 billion euros. This was mainly driven by increased sales of meningitis vaccines, and polio, pertussis, and Hib vaccines, partially offset by adult booster vaccines.

Investors can consider ETFs like the Oppenheimer ADR Revenue ETF (RTR), which has 0.01% of its total assets in Sanofi and holds similar investments in GlaxoSmithKline (GSK), Novartis (NVS), and Unilever (UL). Notably, RTR’s price has risen ~25.5% in the past 12 months.

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