Categories: Business

Sanofi: With disappointing profits and a departing financial director, Sanofi is crashing in the stock market

(BFM Bourse) – The pharmaceutical group published a lower-than-expected net result of activities this Tuesday and announced the departure of its financial director.

Winning back investors won’t be easy for Sanofi. The pharmaceutical giant took the market by storm in late October, falling nearly 19% in a single session. The group then announced that it was counting on a decline in its core profit indicator in 2024 and dropped its margin target in 2025.

The company then chose to double down on its own R&D to accelerate its growth and develop new innovative drugs. Due to which the investment increases.

Three months after these cold showers, Sanofi’s fourth quarter results do not reassure the market. Thus the stock fell 3.6% around 4:20 pm this Thursday, even if Dassault Systèmes (-9.3%) and BNP Paribas (-6.8%) did worse, their results are also approved by the market.

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Stupid in strong growth

In the last three months of the year, Sanofi generated revenue of 10.9 billion euros, an increase of 9.3% excluding currency effects. The group’s blockbuster, Dupixent, indicated for a number of treatments (asthma, itch, etc.), grew by 31.3% excluding currency effects to 2.99 billion euros in sales (and 10.71 billion euros in 2023 as a whole).

In contrast, Aubagio, a treatment against multiple sclerosis, fell 74% to 121 million euros, “mainly reflecting competition from generics in key markets, including Europe, where this competition started at the end of September 2023,” the company explained. .

Operating income from activities was 2.583 billion euros, up 5.3% excluding currency effects, while net income per share from activities, one of Sanofi’s key financial indicators, was 1.66 euros, up 8.2% at constant exchange rates.

All accounts published by Sanofi fell short of market expectations, even significantly for operating profit. According to Vara Research’s consensus by company, analysts expect average sales of 11.04 billion euros, operating profit from activities of 2.77 billion euros and net income per share from activities of 1.7 euros.

Departure of Financial Director

Regarding its outlook, Sanofi confirmed that it expects “low single digits” this year, meaning between 1% and 4% in its net profit per share from activities excluding currency effects. Already communicated at the end of October, this forecast includes the negative impact of taxation, with an expected tax rate of 21%.

“Applying average exchange rates for January 2024, the impact of foreign exchange on business net income per share for 2024 is estimated to be approximately -3.5% to -4.5%,” Sanofi announced.

The pharmaceutical group also announced the departure of its financial director, Jean-Baptiste Chasselope de Chatillon, who has decided to take the helm of Apprentice d’Auteuil, an organization that supports young people in trouble. He will be replaced by François-Xavier Roger, who is currently Nestlé’s financial director.

“The departure of the financial director is regrettable and may undermine investor confidence given the impressive progress he has made so far in terms of operational efficiency in a short period of time,” explained Jefferies as quoted by the AJF-Dow agency. Jones.

Julian Marion – ©2024 BFM Bourse

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