Sanofi delivers solid 2012 results despite patent expirations
PARIS, Feb. 7, 2013 /PRNewswire/ — Sanofi (NYSE: SNY; EURONEXT: SAN)
Q4 2012 Change on a reported Change at constant FY 2012 Change on a reported Change at constant exchange basis exchange rates(1) basis rates ------- -------------------- ------------------ ------- -------------------- --------------------------- Net sales EUR8,526m +0.2% -1.7% EUR34,947m +4.7% +0.5% Business net income(1) EUR1,572m -24.3% -27.1% EUR8,179m -7.0% -12.9% --------------------- --------- ----- ----- --------- ---- ----- Business EPS(1) EUR1.19 -23.7% -26.3% EUR6.20 -6.8% -12.8% -------------- ------- ----- ----- ------- ---- -----
In order to facilitate an understanding of our operational performance, we comment on our business net income statement. Business net income(1) is a non-GAAP financial measure. The consolidated income statement for 2012 is provided in Appendix 6 and a reconciliation of business net income to consolidated net income in Appendix 5. Consolidated net income for 2012 was EUR4,967 million, compared to EUR5,693 million for 2011. Consolidated EPS for 2012 was EUR3.76 versus EUR4.31 for 2011.
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Commenting on the Group’s performance in 2012, Sanofi Chief Executive Officer, Christopher A. Viehbacher said, “2012 was a turning point for Sanofi with the loss of exclusivity in the U.S. for several significant legacy drugs. Despite the effect of the patent cliff, Sanofi was able to grow sales and mitigate the impact on Business EPS(1). At the same time, Sanofi was able to obtain nine significant regulatory approvals and submit six new files with regulatory agencies. Although the financial results in the first half will experience a residual effect from patent expirations, we expect to resume growth in the second half of 2013. This will be driven primarily by continued strong performance from our growth platforms(2) which now represent more than 70% of our sales and rose nearly 10%(3) in 2012. We are on track to meet our 2012-2015 objectives for sustainable growth.”
- Total sales(4 )grew 0.5% to EUR34,947 million. Net sales lost due to generic competition were EUR1,345 million.
- Growth platforms(2) recorded sales of EUR23,548 million, an increase of 9.9%(3) and accounted for 70.4% of total sales in Q4 2012.
- Diabetes recorded very strong sales growth of 16.7% to EUR5,782 million driven by Lantus(®). In Q4 2012, Diabetes grew +20.9%, representing the eighth consecutive quarter of double-digit sales growth.
- “New Genzyme”(5) delivered pro forma sales growth of 16.9% with Fabrazyme(® )sales almost doubling.
- Emerging Markets(6) sales were EUR11,145 million, an increase of 8.3% with double-digit growth recorded in Latin America, Asia and Africa/Middle East.
- Consumer Health Care sales reached EUR3,008 million, an increase of 9.9%, giving Sanofi the # 3 global rank in CHC.
- Vaccines delivered 5.7% sales growth to EUR3,897 million, ending 2012 on a high note with 20.5% growth in Q4.
- Merial grew 3.1% with Frontline showing continued resilience.
- 2012 business EPS(1) was EUR6.20 versus EUR6.65 in 2011 reflecting the negative impact of EUR1.3 billion at CER on the business net income related to the Plavix(®) and Avapro(®) losses of exclusivity in the U.S.
- The proposed dividend of EUR2.77 per share corresponds to a payout ratio of 45% of business EPS(1).
- Since the beginning of the year, Lyxumia(®) (lixisenatide) and Zaltrap(®) (aflibercept) were approved in Europe and Kynamro(TM) (mipomersen) in the U.S. In addition, the Lemtrada(TM) (alemtuzumab) application for multiple sclerosis was accepted for review by the FDA, and the ENCORE Phase III study with eliglustat met its primary efficacy endpoint.
- Phase III data is expected in 2013 for otamixaban for ACS patients with planned early invasive strategy, our JAK2 inhibitor in myelofibrosis, the new glargine formulation in diabetes and anti-PCSK9 mAb in monotherapy for hypercholesterolemia.
- The residual impact from the loss of Plavix(®) and Avapro(®) exclusivity in the U.S. is anticipated to impact business net income in H1 2013 by approximately EUR800m at CER(1). Including this impact, the continued strong performance of growth platforms, investments in late-stage pipeline, launch expenses for new products and ongoing cost savings should lead to a 2013 business EPS flat to 5% lower than 2012(7) at CER, barring major unforeseen adverse events.
(1) See Appendix 9 (on page 26 at http://bit.ly/XQOjJ4) for definitions of financial indicators; (2) See page 2 at http://bit.ly/XQOjJ4; (3) 7.8% with Genzyme pro forma; (4) Growth in net sales is expressed at constant exchange rates (CER) unless otherwise indicated (see Appendix 9 on page 26, at http://bit.ly/XQOjJ4, for a definition); (5) “New Genzyme” consists of rare diseases products and Multiple Sclerosis products; (6) See definition on page 8 at http://bit.ly/XQOjJ4; (7) 2012 business EPS with the retroactive application of IAS19R: EUR6.14.
To access the full press release of the 2012 annual results, please click here:
This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements are statements that are not historical facts. These statements include projections and estimates and their underlying assumptions, statements regarding plans, objectives, intentions and expectations with respect to future financial results, events, operations, services, product development and potential, and statements regarding future performance. Forward-looking statements are generally identified by the words “expects”, “anticipates”, “believes”, “intends”, “estimates”, “plans” and similar expressions. Although Sanofi’s management believes that the expectations reflected in such forward-looking statements are reasonable, investors are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of Sanofi, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include among other things, the uncertainties inherent in research and development, future clinical data and analysis, including post marketing, decisions by regulatory authorities, such as the FDA or the EMA, regarding whether and when to approve any drug, device or biological application that may be filed for any such product candidates as well as their decisions regarding labelling and other matters that could affect the availability or commercial potential of such product candidates, the absence of guarantee that the product candidates if approved will be commercially successful, the future approval and commercial success of therapeutic alternatives, the Group’s ability to benefit from external growth opportunities, trends in exchange rates and prevailing interest rates, the impact of cost containment policies and subsequent changes thereto, the average number of shares outstanding as well as those discussed or identified in the public filings with the SEC and the AMF made by Sanofi, including those listed under “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements” in Sanofi’s annual report on Form 20-F for the year ended December 31, 2011. Other than as required by applicable law, Sanofi does not undertake any obligation to update or revise any forward-looking information or statements.