By Scott Kanowsky
Investing.com -- U.S.-listed shares in Novartis AG ADR (NYSE:NVS) climbed on Tuesday after the Swiss drugmaker confirmed its group guidance for 2022 core operating income to grow in the mid-single-digit percentage range in common currency.
Group-wide sales are also expected to increase in the mid-single digits, Novartis announced in its second quarter earnings release.
However, the company warned that if foreign exchange rates remain at their current levels for the rest of 2022, annual core operating income may be negatively impacted by as much as 8 percentage points.
Meanwhile, the Basel-based company raised its guidance for its generics division, Sandoz, saying it now expects sales at the unit to grow in the low-single digits this year. Novartis also hinted at its future plans for Sandoz, as it looks into a possible sale, spin-off, or retention of the business.
"The strategic review of Sandoz is on track; we expect to provide an update, at the latest, by the end of 2022," Novartis said in a statement.
For the second quarter, Novartis reported second quarter earnings per share of $1.56, $0.04 better than the analyst estimate of $1.52. Revenue came in at $12.78 billion versus the consensus estimate of $12.93 billion.
Novartis said core operating income during the quarter was driven higher by improved sales, especially at its Sandoz and its Innovative Medicines unit. But these gains were tempered in part by an uptick in impairment charges and restructuring costs.
Shares in the company rose by nearly 4% in early U.S. trading but remain lower by almost 10% over the one-year period.