Novartis (NYSE:NVS) posted fourth-quarter results today that trailed the consensus forecast.
The Basel, Switzerland–based company reported a $2.1 billion net income, an 86% increase in Q4 2019. Earnings per share for the quarter ended Dec. 31 were $1.34 per share on revenue of $12.8 billion.
Analysts had anticipated earnings of $1.36 per share.
Still, there is room for optimism.
In an earnings call, Novartis CEO Vasant Narasimhan said the company had achieved “solid operational performance over the past three years,” after revamping its strategy in 2018. Net sales from 2017 to 2020 have grown 5% annually while its Innovative Medicines division achieved a 35% growth rate in 2020.
“We have a leading pipeline across 10 therapeutic areas [and], four advanced therapy platforms,” Narasimhan added.
Novartis has enacted a series of cost-savings measures that has enabled the company to save $2 billion in cost over the past three years. Those savings and a data science platform that provides insights into the company’s operations have helped the company weather the pandemic, Narasimhan said.
Narasimhan is optimistic about the prospect of sales growth to pick up in the second half of 2021 when he believes the COVID-19 crisis will stabilize and healthcare systems will begin to return to normalcy. “I would say, broadly, that healthcare systems are working at 80% to 90% of what they would normally work at,” he said.
Narasimhan said that when a growing number of patients seek medical care, it will most benefit its ophthalmology and dermatology portfolios. Such a rebound in patient volumes would also support its new drug launches. “I’m hopeful […] that we can accelerate our growth in the back half of this year,” Narasimhan told Bloomberg.
Investors reacted to the Q4 results by sending NVS shares down 2.57% to $95.94.
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