Novartis: Very solid Q1 that could have led to guidance increase - CFO J. Symonds surprisingly leaving

BUY, Fair Value CHF72.3 (+4%)

News published on April Wednesday 24, 2013
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Very solid Q1 that could have led to guidance increase - CFO J. Symonds surprisingly leaving
Novartis posted this morning very solid first-quarter results although it is fair to say that the upper part of the P&L did not show any major difference to expectations. Although we knew that Diovan monotherapy was still not under generic attack in the US, net sales grew very decently by 4% in constant currencies while core operating profit advanced 6%. Novartis might then be seen as very conservative as it keeps its annual guidance for flat revenues and declining earnings unchanged. Actually the big difference at the Core EPS level comes from a surprising surge in core profits from associates (mainly Roche) which requires clarification. Lastly Novartis announced the departure of CFO Jon Symonds and the replacement by current CFO Pharma Harry Kirsch. We do not believe this change is for any strategic or professional reasons and would interpret it as a personal decision.


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