Latest Novartis Earnings Show Signs of a Rebound at Alcon
As part of its second quarter earnings, Novartis reported that sales at its Alcon unit accelerated in the second quarter. Novartis Chief Executive Joe Jimenez said the results increase the number of options it has moving forward, including the possibility of an Alcon spin-off.
Novartis has been reviewing the future ownership of Alcon, with an update slated for later this year. All options are under consideration, Mr. Jimenez said on Tuesday, including a possible IPO that he has suggested could value Alcon at $25 billion to $35 billion.
"It just increases the options we have," Mr. Jimenez said on a conference call. "It makes a capital markets exit a possibility, because you've got a growing business with presumably over time margins that are going to grow."
Alcon sales rose 1 percent to $1.5 billion. In April, Novartis said the it expected Alcon’s sales to be unchanged from the prior year. Alcon's surgical sales grew 3% with strong growth in cataract consumables and vitreoretinal, IOLs returning to growth globally. IOL sales grew for the first time in the second quarter since 2014. Vision Care sales grew 2%, driven by the continued double-digit growth of Dailies Total1, according to Novartis
Novartis now expects Alcon’s revenue in 2017 to likely grow by a low “single-digit” percent.
For all of Novartis, second-quarter core net income fell 2 percent to $2.87 billion, but beat the average analyst forecast of $2.668 billion. Sales fell 2 percent to $12.242 billion, hurt by declining revenue from blood cancer drug Gleevec.
You must be logged in to leave a comment.