Drugmaker AstraZeneca warns on Covid-19 impact

AstraZeneca braces for coronavirus hit, but no impact so far

Drugmaker AstraZeneca warns on Covid-19 impact

British drugmaker AstraZeneca forecast revenue growth for this year of around 10% on Friday, as it factored in a hit from the coronavirus outbreak in China and fell short of analysts' expectations for fourth-quarter results.

For the year, the company reported profit of $1.34 billion, or 51 cents per share.

AstraZeneca said its "core" operating profit, which excludes certain expenses, rose 13% to $6.44bn.

The company declared a dividend of $1.90 a share, bringing the total dividend at $2.80, unchanged from the year before.

At 1312 GMT, AstraZeneca shares were down 2.3% at 7,448 pence.

China is the fastest-growing sales region for AstraZeneca, with the 2019 full-year results published on Friday showing growth of 35 per cent there on a constant currency basis, compared to 13 per cent for the United States, two per cent in Europe and 26 per cent in Japan.

China is one of AstraZeneca's big contributors to revenue growth, and the uncertainty about the impact of the coronavirus has led the company to peg its 2020 forecast at a "high single-digit to a low double-digit percentage". Operating costs increased 11% to $18.1bn as AstraZeneca wrote down the value of more intangible assets and spent extra money launching new medicines and in emerging markets.

Sales were up a reported 12% for the full year to almost $23.6 billion, and CEO Pascal Soriot noted that several new drugs are likely to drive growth in the coming year. Results from our new medicines and emerging markets accompanied positive news for patients, most recently including regulatory approvals of Enhertu in breast cancer and Calquence in leukaemia.

"Driven by a strong team, 2020 is anticipated to be another year of progress for AstraZeneca".

Soriot said the company was becoming a better-balanced business, both regionally and through its medicines.

The results did not meet Wall Street expectations.

The group nevertheless forecast that total sales would rise by about ten per cent in 2020 and earnings-per-share would increase by about 15 per cent.

China is also an important market for top-selling cancer drug Tagrisso, which has just been added to the country's list of reimbursed drugs.

AstraZeneca returned to growth in 2018 for the first time since 2014 when it fought off a hostile takeover bid from Pfizer.

Latest News