AstraZeneca has lifted its full-year core earnings guidance this morning, as the pharmaceuticals giant began to show signs of picking up after a disappointing summer.
Total revenue at AstraZeneca climbed to $6.34bn in the third quarter, up nine per cent year on year, which helped close the gap for the year-to-date revenues to a four per cent decline on last year.
Product sales were still down three per cent on last year, at $4.88bn. But this was a recovery from the 11 per cent decline in the first half of the year, bringing the year-to-date sales down nine per cent on 2016.
Core earnings fell 15 per cent in the third quarter to reach $1.12 per share.
Shares were up 0.7 per cent at 5,027p in lunchtime trading.
Why it's interesting
After being hit by increasing competition and losses of exclusivity, AstraZeneca has finally shown signs of picking up. Although product sales were still down, the gap has closed.
Emerging markets and China performed especially well for the pharma company, while positive developments with certain lung cancer and asthma drugs “offset the disappointment” from the failed Mystic trial which caused shares to plummet in July.
AstraZeneca revised up its full-year core earnings guidance, saying it will now be “towards the favourable end of a low to mid teens percentage decline”.
Analysts at Investec noted the total revenue and core earnings were both up two per cent on consensus figures, and reiterated a “buy” rating.
However, the broker noted its recently raised £55 target price was “based on longer term delivery from the pipeline rather than AstraZeneca’s performance through near term reporting events”.
“We see Astra with a rich product pipeline set to give data points over the next 12 months,” said analyst Andrew Whitney.
What AstraZeneca said
Chief executive Pascal Soriot said:
Our financial performance in the quarter was in line with expectations, reflecting good commercial execution, including strong growth in emerging markets with standout sales in China. It was, however, the raft of news flow and approvals that was most notable.
This impressive momentum is set to continue with regulatory and data milestones that have the potential to show how our science-led strategy and pipeline-driven transformation are delivering for patients and shareholders.