The first half of 2007 was a mixed bag for Novartis
On Tuesday, Novartis released results for the first half that proved that not everything is going so badly for the Swiss company. Net income and earnings per share each gained 14%, despite the loss of hundreds of millions of dollars in revenue when Novartis had to pull constipation drug Zelnorm from the market. Operating cash flow trailed earnings growth, though, coming in just 8% higher versus the first half of 2006.
Novartis slightly lowered its sales growth projections yet again to "mid-single-digit" percentages for the year. Barring any other major sales upheavals, like what happened with Zelnorm earlier in the year, Novartis expects to return to double-digit sales growth from continuing operations by the end of 2008, with drugs like the recently launched Lucentis, for macular degeneration, picking up steam in the European Union.
Large-cap pharmaceutical companies like Novartis always produce a lot of news, both positive and negative, because of ongoing developments with their drug pipelines and approved compounds. For investors who are willing to filter the negative news and are patient enough to wait for recently launched branded compounds to help its top-line growth, Novartis is worth a look.
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