Write-downs a bitter treatment for Sanofi shareholders

Paris (AFP) –


French pharmaceutical giant Sanofi said Monday it suffered a loss in the second quarter after it booked nearly three billion euros in write-downs of the value of its assets, but said it remained confident net profits would rise for the year.

The net loss of 87 million euros ($97 million) came despite a 5.5 percent increase in net sales to 8.6 billion euros, which was slightly higher than the analyst consensus compiled by financial data firm Factset.

The company pointed to a more than 20 percent jump in sales at Sanofi Genzyme, its bio-tech specialty care firm that it created following its 2011 acquisition of Genzyme for 15 billion euros, thanks to a strong launch of Dupixent, a treatment for atopic dermatitis and asthma.

Gross profits rose by 7.6 percent in the first half to 12.3 billion euros, but write-downs to the value of its assets and restructuring charges weighed in at over 3.7 billion euros.

Included in that was a 1.8-billion-euro charge against hemophilia treatment Eloctate due to disappointing sales in the United States, which fell by 11 percent on a comparative basis.

Nevertheless, chief executive Olivier Brandicourt said: "We are confident in the growth outlook for the year."

The firm revised upward its forecast for full-year earnings per share to an increase of five cents per share.

Sanofi shares jumped 2.3 percent after trading opened on Monday morning, while the CAC 40 index of blue chip stocks dipped 0.3 percent.