(RTTNews) – Novartis (NVS) reported first quarter net income from continuing operations of $2.2 billion, an increase of 16%, or up 24% cc year-on-year, including higher legal provisions and taxes. Earnings per share was $0.96 compared to $0.81. Core operating income was $4.2 billion, growth of 28%, or up 34% cc, mainly driven by higher sales, benefiting from COVID-19 forward purchasing and gross margin improvement, partly offset by launch investments. Excluding COVID-19 related forward purchases and lower spending, the company estimates core operating income growth to be approximately 22% cc. Core earnings per share was $1.56 compared to $1.21. On average, six analysts polled by Thomson Reuters expected the company to report profit per share of $1.36, for the quarter. Analysts’ estimates typically exclude special items.

Novartis said, during the first quarter, COVID-19 did not have a material impact on its underlying business, financial condition, cash collections or liquidity. COVID-19 did result in increased forward purchasing by customers, the company noted. Forward purchasing had a favorable impact of approximately $0.4 billion on sales. Core operating income benefited by approximately $0.4 billion from forward purchasing and lower spending. The company expects these impacts to reverse in the remainder of 2020.

First quarter net sales from continuing operations were $12.3 billion, up 11%, or up 13% cc, driven by volume growth of 17 percentage points, mainly from Entresto, Zolgensma, Cosentyx and Promacta/Revolade. Analysts expected revenue of $12.03 billion for the quarter. Volume growth also benefited from COVID-19 related forward purchasing. Excluding COVID-19 related forward purchases, the company estimates sales growth would have been approximately 9% (cc).

For continuing operations, the company confirmed 2020 guidance for net sales to grow mid to high-single digit (cc); and core operating income to grow high-single to low double digit (cc).

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