Novo Nordisk(NVO)2024-08-07 06:07Sales Performance - Sales increased by 24% in Danish kroner and 25% at constant exchange rates (CER) to DKK 133.4 billion in the first six months of 2024[1] - Total sales increased by 24% in Danish kroner and 25% at CER to DKK 133,409 million, driven by growth in Diabetes and Obesity care segments[16] - Total sales increased by 24% to DKK 133,409 million, with North America Operations up 36% and International Operations up 9%[50] - Net sales increased by 25% to DKK 68,060 million in Q2 2024 compared to Q2 2023[126] - Net sales for H1 2024 increased to DKK 133,409 million, up 23.9% from DKK 107,667 million in H1 2023[128] - Total sales for the company reached DKK 68,060 million, with a 25% year-over-year growth at CER, driven by strong performance in North America (36% growth) and the US (39% growth)[135] - Total sales grew by 25% at CER to DKK 133,409 million, with North America and the US contributing 36% and 38% growth respectively[136] - Net sales at CER increased by 25% to DKK 134,191 million in H1 2024 compared to DKK 107,667 million in H1 2023[139] Diabetes and Obesity Care - Diabetes and Obesity care sales increased by 26% in Danish kroner to DKK 125.0 billion, driven by GLP-1 diabetes sales growth of 32% and Obesity care growth of 37% to DKK 24.9 billion[2] - Diabetes care sales grew by 24% in Danish kroner and 25% at CER to DKK 100,110 million, with GLP-1-based products contributing 72,017 million, a 32% increase[16][18] - Ozempic® sales surged by 36% to DKK 56,685 million, driven by strong performance in North America and International Operations[16][22] - Wegovy® sales increased by 74% to DKK 21,036 million, reflecting strong demand in the Obesity care segment[16] - Novo Nordisk's global diabetes value market share improved to 34.1%, up from 32.6%, with a target to exceed one-third market share by 2025[18] - GLP-1-based therapies for type 2 diabetes achieved a 56.0% global value market share, with sales reaching DKK 72,017 million, a 32% increase[20][21] - Sales of Obesity care products increased by 37% to DKK 24,939 million, with a global market share of 79.6%[36] - Wegovy® sales increased by 74% to DKK 21,036 million, while Saxenda® sales decreased by 36% to DKK 3,903 million[37] - Sales of Obesity care products in North America Operations increased by 35% to DKK 19,072 million, with Wegovy® sales up 58% to DKK 18,331 million[38] - Sales of Obesity care products in International Operations increased by 47% to DKK 5,867 million, with Wegovy® launched in 12 countries[39] - Sales in Q2 2024 increased by 25% in Danish kroner and at CER, driven by Diabetes and Obesity care, with GLP-1 diabetes sales up 32% and Obesity care sales up 34% at CER[63] - Total Diabetes and Obesity care sales reached DKK 64,084 million, with a 27% year-over-year growth at CER, driven by strong performance in North America (38% growth) and the US (41% growth)[135] - Ozempic® sales grew by 30% at CER to DKK 28,875 million, with significant contributions from North America (39% growth) and the US (46% growth)[135] - Wegovy® sales surged by 53% at CER to DKK 11,659 million, with North America accounting for DKK 10,098 million and a 39% growth rate[135] - Total Obesity care sales increased by 34% at CER to DKK 13,904 million, driven by Wegovy® and Saxenda®, with North America contributing DKK 10,654 million[135] - Injectable GLP-1 sales grew by 29% at CER to DKK 31,117 million, with North America and the US showing strong growth at 42% and 49%, respectively[135] - Diabetes and Obesity care segment total sales increased by 27% at CER to DKK 125,049 million, driven by strong growth in North America (37%) and the US (39%)[136] - Ozempic® sales grew by 36% at CER to DKK 56,685 million, with significant growth in North America (44%) and the US (48%)[136] - Wegovy® sales surged by 74% at CER to DKK 21,036 million, with North America contributing 57% growth and the US 56%[136] - Total GLP-1 sales increased by 32% at CER to DKK 72,017 million, with North America and the US growing by 39% and 42% respectively[136] Rare Disease Sales - Rare disease sales decreased by 4% in Danish kroner (3% at CER) to DKK 8.4 billion[2][10] - Rare disease sales decreased by 4% to DKK 8,360 million, with rare blood disorder products down 2% and rare endocrine disorder products down 9%[42] - Rare disease segment sales decreased to DKK 8,360 million in H1 2024, down 3.8% from DKK 8,690 million in H1 2023[128] - Rare disease segment sales declined by 3% at CER to DKK 3,976 million, with Rare blood disorders contributing DKK 2,864 million and a 1% growth rate[135] - Rare disease segment sales declined by 3% at CER to DKK 8,360 million, with Rare blood disorders decreasing by 2% and Rare endocrine disorders by 8%[136] Operating Profit and Financial Performance - Operating profit grew by 18% in Danish kroner and 19% at CER to DKK 57.8 billion, impacted by a DKK 5.7 billion impairment loss related to ocedurenone[1] - Operating profit increased by 18% in Danish kroner and 19% at CER to DKK 57,780 million, impacted by an impairment loss of DKK 5.7 billion related to ocedurenone[60] - Net profit increased by 16% to DKK 45,457 million, with diluted earnings per share rising by 17% to DKK 10.17, also impacted by the DKK 5.7 billion impairment loss[61] - Operating profit (EBIT) grew by 9% to DKK 25,934 million in Q2 2024, with an operating margin of 38.1%[126] - Net profit increased by 3% to DKK 20,050 million in Q2 2024[126] - Net profit for H1 2024 reached DKK 45,457 million, up 15.8% from DKK 39,242 million in H1 2023[128] - Operating profit at CER rose by 19% to DKK 58,408 million in H1 2024 from DKK 48,895 million in H1 2023[139] - EBITDA grew by 32% to DKK 69,539 million in H1 2024 compared to DKK 52,791 million in H1 2023[141] - Net profit increased by 16% to DKK 45,457 million in H1 2024 from DKK 39,242 million in H1 2023[141] Research and Development - Research and development costs increased by 79% to DKK 24,772 million, driven by increased clinical trial activity and impairments[59] - Research and development costs increased by 127% in Danish kroner and 126% at CER, driven by late-stage clinical trials and the DKK 5.7 billion impairment loss[68] - Research and development costs surged by 127% to DKK 16,166 million in Q2 2024, representing 23.8% of sales[126] - Research and development expenses included an impairment loss of DKK 5.7 billion related to ocedurenone, recognized in the Diabetes and Obesity segment[128] Free Cash Flow and Capital Expenditure - Free cash flow reached DKK 41.3 billion, with DKK 38.9 billion returned to shareholders[11] - Free cash flow in H1 2024 was DKK 41.3 billion, down from DKK 45.5 billion in H1 2023, reflecting increased capital expenditure and acquisitions of intangible assets[71] - Capital expenditure for property, plant, and equipment was DKK 18.9 billion in H1 2024, up from DKK 10.6 billion in 2023, primarily for API production and fill-finish capacity[72] - Free cash flow decreased to DKK 41,309 million in H1 2024 from DKK 45,537 million in H1 2023[143] - Net cash generated from operating activities rose to DKK 64,817 million in H1 2024 from DKK 58,391 million in H1 2023[143] - Net cash used in investing activities increased to DKK 16,775 million in H1 2024 from DKK 15,932 million in H1 2023[143] Regional Sales Performance - Sales in North America Operations increased by 36% in Danish kroner (36% at CER), while International Operations grew by 9% in Danish kroner (11% at CER)[1] - North America Operations saw a 38% increase in Diabetes care sales to DKK 57,257 million, with the US contributing DKK 53,148 million, a 41% growth[19] - International Operations' GLP-1 sales increased by 20% at CER to DKK 22,310 million, with Region China growing by 23% to DKK 3,684 million[21][27] - EMEA sales increased by 13% to DKK 21,697 million, driven by Rybelsus® and Ozempic®, with a 61.5% value market share in the GLP-1 segment[26] - Sales of insulin in EMEA increased by 2% in Danish kroner and 3% at CER, driven by long-acting insulin, with a market share of 47.4%[33] - Sales of insulin in Region China increased by 7% in Danish kroner and 11% at CER, driven by long-acting and premix insulin, with a market share of 41.3%[34] - Sales of insulin in Rest of World decreased by 7% in Danish kroner and 4% at CER, with a market share of 57.2%[35] - North America Operations sales grew by 38% in Danish kroner and 36% at CER, driven by GLP-1 diabetes sales (up 41% at CER) and Obesity care sales (up 28% at CER)[64] - International Operations sales increased by 10% in Danish kroner and 11% at CER, with Obesity care sales growing 58% at CER[65] - North America Operations sales increased by 38% to DKK 40,930 million in Q2 2024, with the US contributing DKK 38,404 million, up 41%[126] - Share of growth was heavily weighted towards North America and the US, accounting for 79% of total growth, while International Operations contributed 21%[135] Product Approvals and Clinical Trials - The phase 3 FRONTIER 2 trial with Mim8 demonstrated superior reduction of treated bleeding episodes in haemophilia A patients[2] - The company received a Complete Response Letter from the FDA for insulin icodec and a positive CHMP opinion for a Wegovy® label update in the EU[3] - Wegovy® approved in China for the treatment of obesity or overweight, with a BMI threshold of ≥27[97] - Positive CHMP opinion for Wegovy® label update to reflect a 20% reduction in major adverse cardiovascular events[97] - Oral semaglutide 25 mg achieved 13.6% weight loss in the OASIS 4 phase 3 trial, compared to 2.2% with placebo[98] - IcoSema demonstrated superior HbA1c reduction of -1.55 percentage points and body weight change of -3.70 kg in the COMBINE 1 trial[95] - Awiqli® approved in the EU, Japan, and China for the treatment of type 1 and type 2 diabetes[90] - Esperoct® approved in China for the treatment of haemophilia A in patients aged 12 years and above[99] - Concizumab approved in Japan for the treatment of haemophilia A and B without inhibitors under the brand name Alhemo™[99] - Concizumab resubmitted for regulatory approval in the US for the treatment of haemophilia A and B with inhibitors, with review expected to be completed around the turn of the year[99] - Phase 3a trial FRONTIER 2 with Mim8 successfully completed, demonstrating superior reduction of treated bleeding episodes compared to on-demand and prior prophylaxis treatment[101] - Phase 3 trial ARTEMIS initiated with ziltivekimab in around 10,000 people with Acute Myocardial Infarction (AMI), expected to complete in the second half of 2026[103] Environmental and Social Responsibility - Total CO2e emissions increased by 31% in H1 2024 compared to H1 2023, with Scope 3 emissions increasing by 32% due to increased investments in capital expenditure[107][109] - Total number of patients reached with Novo Nordisk products increased to 42.1 million in H1 2024, a 5% increase compared to H1 2023[110][111] - Number of children reached through the Changing Diabetes® in Children programme increased by 25% to 56,821 in H1 2024 compared to H1 2023[110][111] - Full-time employees increased by 17% to 69,260 in H1 2024 compared to the previous year, driven mainly by Product Supply[112] - Novo Nordisk aims to reach zero CO2e emissions from operations and transportation by 2030, with a 36% reduction in emissions compared to H1 2019[108] Financial Outlook and Forward-Looking Statements - The company raised its 2024 outlook, expecting sales growth of 22-28% at CER and operating profit growth of 20-28% at CER[3] - Sales growth expected to be 22% to 28% at CER, with reported growth around 1 percentage point lower due to exchange rates[81] - Operating profit growth expected to be 20% to 28% at CER, with reported growth around 1 percentage point lower due to exchange rates[81][84] - Financial items (net) expected to result in a loss of around DKK 0.5 billion, mainly due to foreign exchange hedging contracts[85] - Capital expenditure expected to be around DKK 45 billion in 2024, focusing on global supply chain expansion[85] - Free cash flow expected to be between DKK 59 and 69 billion, reflecting increased sales growth and US rebates[86] - Forward-looking statements include targets for future operations, revenue projections, and financial measures such as earnings per share and capital expenditures[123] - Factors affecting future results include global economic conditions, currency fluctuations, R&D delays, supply chain disruptions, and regulatory changes[123] - Novo Nordisk's forward-looking statements are subject to risks such as product recalls, cybersecurity breaches, and legal proceedings[123] Financial Reporting and Metrics - The company's financial report covers the period from 1 January 2024 to 30 June 2024[124] - Quarterly financial numbers are provided in DKK (Danish Krone)[125] - Gross profit rose by 24% to DKK 57,786 million in Q2 2024, with a gross margin of 84.9%[126] - Total GLP-1 sales grew by 33% to DKK 37,035 million in Q2 2024[126] - Wegovy sales surged by 55% to DKK 11,659 million in Q2 2024[126] - Net cash generated from operating activities rose by 77% to DKK 50,503 million in Q2 2024[126] - Full-time equivalent employees increased by 17% to 69,260 at the end of Q2 2024[126] - Gross profit for H1 2024 rose to DKK 113,219 million, a 23.6% increase from DKK 91,629 million in H1 2023[128] - Net cash generated from operating activities in H1 2024 was DKK 64,817 million, up 11.0% from DKK 58,391 million in H1 2023[129] - Total assets increased to DKK 369,383 million as of 30 Jun 2024, up 17.4% from DKK 314,486 million as of 31 Dec 2023[130] - Total equity rose to DKK 112,522 million as of 30 Jun 2024, up 5.6% from DKK 106,561 million as of 31 Dec 2023[130] - Dividends paid in H1 2024 amounted to DKK 28,557 million, a 55.7% increase from DKK 18,337 million in H1 2023[132] - Net sales and operating profit growth at CER excludes the effect of currency fluctuations, providing a clearer view of underlying performance[138] - Depreciation, amortisation, and impairment losses surged by 202% to DKK 11,759 million in H1 2024 from DKK 3,896 million in H1 2023[141] - Income taxes increased by 21% to DKK 11,793 million in H1 2024 from DKK 9,749 million in H1 2023[141] - Financial expenses rose significantly to DKK 3,636 million in H1 2024 from DKK 475 million in H1 2023[141]