Roche 2020 Net Profit Rises But Biosimilars Continue to Pose Headwinds -- Earnings Review

By Cecilia Butini

Roche Holding AG reported 2020 earnings on Thursday. Here's what we watched.

SALES: The Swiss pharmaceutical company posted sales of 58.32 billion Swiss francs ($64.88 billion) for 2020, just shy of analysts' forecast of CHF59.42 billion, and down from CHF61.47 billion in 2019.

NET PROFIT: Net profit for the year came in at CHF14.30 billion, versus a consensus estimate that had it at CHF14.59 billion. This was slightly up from CHF14.11 in 2019.

WHAT WE WATCHED:

GUIDANCE: The company guided for sales growth in the low-to-mid single-digit range at constant exchange rates, which was described as conservative by some analysts as the current market consensus is above company guidance.

BIOSIMILAR EROSION OF SALES: The impact of biosimilar competition on sales was quantified by the company at negative CHF5.1 billion at constant exchange rates. The erosion hit the pharmaceutical division particularly hard as was expected, driving a 2% decline in sales in the year. Looking ahead, the company said it expects biosimilars to continue to weigh.

TAILWINDS IN DIAGNOSTICS: Covid-19 tests propelled growth in the diagnostics division, as anticipated by analysts. Sales rose 14% in the division, with molecular diagnostics posting 90% growth on the back of strong demand for tests.

Write to Cecilia Butini at [e-mail]

(END) Dow Jones Newswires

February 04, 2021 09:53 ET (14:53 GMT)

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