The Roche pharmaceuticals group has reported that net income fell 28 per cent during the first half of the year to SFr1.8 billion ($1.22 billion).This content was published on August 14, 2002 - 09:47
The company blamed weak financial markets for the poor result.
The net income result was well below analysts' expectations of SFr2.6 billion and was significantly lower than last year's first-half figure of SFr2.99 billion.
Sales rose by two per cent to SFr14.737 billion, but this was also below analysts' expectations of SFr15 billion.
"Owing to negative developments on financial markets, financial income was down significantly from the previous-year period", said Roche chairman and CEO Franz Humer.
Upbeat about the future
The Basel-based firm reiterated that it saw full-year sales growth to be in the mid- to high single digit range for 2002 as a whole and anticipated a further improvement of the firm's operating profit.
"We are confident of our ability to meet all full-year sales and earnings expectations announced early this year," added Humer.
Income from the company's cash mountain plunged by almost two-thirds to SFr520 million, reflecting market turmoil and a more conservative investment policy by new finance chief Erich Hunziker.
Sales at its flagship pharmaceuticals division rose just one per cent as a recent dearth of new product launches left Roche trailing the double-digit sales growth that some rivals, like city neighbour Novartis, have generated.
However, operating income in the drugs division rose 12 per cent to SFr1.994 billion, while sales at its diagnostics unit rose seven per cent to SFr3.261 billion, with operating income up 13 per cent at SFr561 million.
Revenue at the vitamins and fine chemicals unit, which is up for sale, fell four per cent to SFr1.747 billion, leading to a steep fall in operating profit to SFr140 million.