Sanofi: split overshadowed by profit warning
(CercleFinance.com) - Sanofi shares slumped on Friday, with the group's announcement of a plan to split the consumer health business eclipsed by a warning for 2024 and 2025.
On announcing its third quarter results, which came in below expectations, the pharmaceutical group confirmed its targets for 2023 and delivered preliminary outlooks for 2024 and 2025.
While the laboratory reiterated its forecast of business EPS growth in a mid-single digit range at constant exchange rates for 2023, its medium-term targets proved to be much more disappointing.
Due to the increase in its R&D investments, Sanofi says it expects its 2024 business EPS to remain pretty much stable relative to 2023 levels, excluding the impact of the expected increase in its tax rate.
Another disappointment is that Sanofi says that it has abandoned its target operating margin of 32% by 2025, while saying that it remains attentive regarding profitability over the long term.
The only real piece of good news, likely to be "welcomed" by the markets, is the announcement of Sanofi's intention to separate its consumer health activity at the end of 2024 via the creation of an listed entity, Stifel analysts commented. They indee expected this to happen sooner or later, although certainly not by the end of next year, they add.
However in Paris, the profit warning prevailed this morning, with analysts preparing to lower their estimates on the group after the details provided this morning.
Down 15%, Sanofi shares are by far the biggest faller in the CAC 40 index this morning.
Copyright (c) 2023 CercleFinance.com. All rights reserved.
On announcing its third quarter results, which came in below expectations, the pharmaceutical group confirmed its targets for 2023 and delivered preliminary outlooks for 2024 and 2025.
While the laboratory reiterated its forecast of business EPS growth in a mid-single digit range at constant exchange rates for 2023, its medium-term targets proved to be much more disappointing.
Due to the increase in its R&D investments, Sanofi says it expects its 2024 business EPS to remain pretty much stable relative to 2023 levels, excluding the impact of the expected increase in its tax rate.
Another disappointment is that Sanofi says that it has abandoned its target operating margin of 32% by 2025, while saying that it remains attentive regarding profitability over the long term.
The only real piece of good news, likely to be "welcomed" by the markets, is the announcement of Sanofi's intention to separate its consumer health activity at the end of 2024 via the creation of an listed entity, Stifel analysts commented. They indee expected this to happen sooner or later, although certainly not by the end of next year, they add.
However in Paris, the profit warning prevailed this morning, with analysts preparing to lower their estimates on the group after the details provided this morning.
Down 15%, Sanofi shares are by far the biggest faller in the CAC 40 index this morning.
Copyright (c) 2023 CercleFinance.com. All rights reserved.