Thursday, French drug manufacturer Sanofi-Aventis SA (SNY) reported a 4.4% decline in adjusted net profit for the second quarter. Excluding certain selected items, quarterly adjusted net income increased from last year. Net sales declined 3.6% in the quarter impacted by weak dollar and the end of Copaxone agreement with Teva Pharmaceutical Industries Ltd. (TEVA). However, sales grew 5.2% on a comparable basis. The company lifted its adjusted earnings growth forecast for fiscal 2008.
According to media reports, Sanofi-Aventis discontinued development of four drugs following the negative quarterly results, and reported a negative study on an anti-depression drug.
The company's second-quarter net income after minority interests was 1.01 billion euros or 0.77 euro per basic share.
Sanofi-Aventis' second quarter-results included material impacts of the application of purchase accounting to acquisitions, primarily the acquisition of Aventis, amounting to 595 million euros or 0.46 euros per share net of deferred taxes.
On an adjusted basis, excluding material impacts of the application of purchase accounting and acquisition-related integration and restructuring costs, second-quarter net income declined 4.4% to 1.605 billion euros from 1.678 billion euros last year, while adjusted basic earnings per share was 1.23 euros, down 0.8% from prior year's 1.24 euros.
Quarterly results also included certain selected charges of 148 million euros, comprising restructuring costs of 126 million euros, impairment of PP&E and intangibles of 49 million euros, partly offset by gain on disposals of 27 million euros, while last year's results included charges of 62 million euros.
In the quarter, adjusted net income excluding selected items rose 0.7% to 1.753 billion euros from last year's 1.740 billion euros, while basic earnings per share increased 3.9% to 1.34 euros from 1.29 euros a year ago.
In US dollar terms, adjusted net income excluding selected items grew 16.7% from last year, and adjusted earnings per share excluding selected items rose 20.7%.
Sanofi-aventis' net sales declined 3.6% to 6.69 billion euros from 6.94 billion euros in the previous year.
Exchange rate movements had an unfavorable effect of 6.5 points, of which nearly 75% was due to the U.S. dollar. The company also noted that changes in Group structure, including the end of commercialization of Copaxone in the United States and Canada under the agreements with Teva resulted in unfavorable effect of 2.3 points.
On a comparable basis, excluding the impact of exchange rate movements and changes in Group structure, sales grew 5.2%.
Comparable net sales in the Pharmaceuticals business rose 4.1% year-over-year to 6.03 billion euros. Net sales of the top 15 products were up 5.8% to 4.03 billion euros. Lovenox, the low molecular weight heparin on the market, reported moderate growth in net sales, with a 6.5% rise in U.S. sales to 379 million euros. Net sales of insulin drug Lantus climbed 27.2% in the second quarter to 576 million euros, with a 26.2% rise in U.S.
Vaccines sales, on a comparable basis, climbed 17.1% to 657 million euros. Net sales of influenza vaccines increased 78.2% in the quarter to 155 million euros.
Among regions, Europe net sales rose 1% to 3.05 billion euros, and United States recorded a 6.6% growth to 1.98 billion euros, while emerging markets recorded double-digit growth. Quarterly sales from Other Countries grew 12% to 1.67 billion.
Gross profit declined to 5.25 billion euros from 5.39 billion euros a year ago, and adjusted operating income declined to 2.15 billion euros from last year's 2.30 billion euros due to higher restructuring costs.
Tuesday, Israeli generic drug maker Teva Pharma reported a 5% rise in profit for the second quarter, driven by full in-market sales of Copaxone and new product launches in the U.S. The company's second-quarter net income rose to $539 million or $0.65 per share from $515 million or $0.63 per share last year. Quarterly net sales grew 18% to $2.82 billion from $2.39 billion in 2007.
For the first six months of fiscal 2008, Sanofi-Aventis' consolidated net income fell to 2.34 billion euros or 1.78 euros per basic share from 2.67 billion euros last year.
Adjusted net income declined 8.6% to 3.47 billion euros from last year's 3.80 billion euros, and adjusted earnings per share were down 6% to 2.64 euros from 2.81 euros a year ago.
Year-to-date net sales dropped 3.5% to 13.63 billion euros from 14.12 billion euros in the previous year. On a comparable basis, first-half net sales rose 2.9%.
Looking ahead, Sanofi-Aventis now expects full-year 2008 adjusted earnings per share excluding selected items to grow around 8% compared to 7% growth projected earlier. For fiscal 2007, the company reported adjusted earnings per share excluding selected items of 5.17 euros. The company pointed out that a 1-cent movement in the euro/dollar exchange rate is estimated to impact a 0.5% of growth.
SNY closed Wednesday's regular trading session at $36.42, up $0.39 or 1.08%, on a volume of 1.67 million shares.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.