Sanofi: Oddo BHF confirms its advice after the results

(CercleFinance.com) – The group presented its figures for the 3rd quarter of 2023 and its strategic plan. Following this publication, Oddo BHF confirms its advice to Outperformance on value and its target of 105 E.

‘ Sanofi published its Q3 23 results this morning which came out below expectations in terms of sales and its Core EPS. Sanofi remains impacted by a deleterious exchange rate effect over the period (-7% topline and -9% bottom line)’ indicates Oddo BHF.

The analyst underlines that the group’s total sales amount to 11,964 ME against 12,097 ME expected (-4.1%; +3.2% at cc), its core EBIT at 4,028 ME against 4,078 ME expected (-10.4%; -1 % cc) for a Core EPS of 2.55 E versus 2.61 E expected (source Vara Research).

‘On the Vaccine side, sales of seasonal flu are lower than expected, notably due to a sharp decline in the vaccination rate,’ indicates the analysis office.

Oddo BHF indicates that the market should focus on the announcement of the strategic plan presented this morning.

The plan involves an exit from its Consumer activity (at the earliest in Q4 2024), and ‘cost savings’ of 2 billion between 2024 and 2025 but which will be fully reinvested.

‘The disappointment comes from the first guidance for 2024 and the announcement of the end of its MT guidance. Indeed, due to a higher tax rate than anticipated (rising from 19% to 21% next year), the group anticipates a drop in its Core EPS in ‘low single digit’. The Consensus previously recorded an increase of 6% for next year. In addition, Sanofi will no longer target a Core EBIT ratio of 32% in 2025. An adjustment of expectations of the same order as in 2024 is to be expected,’ adds Oddo BHF.

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