AstraZeneca sees product sales rise 10pc in first quarter

(Sharecast News) - AstraZeneca reported a 10% increase in its product sales in its first quarter on Friday, or 14% at constant exchange rates, to $5.47bn.The FTSE 100 pharmaceuticals giant said its reported gross margin increased by two percentage points, or three at constant currencies, to 79%, partly reflecting the mix of product sales, with the core gross margin also increasing by two percentage points to 80%.Reported operating expenses were up 1% in the three months ended 31 March, or 5% at constant exchange rates, to $3.86bn, representing 70% of total revenue, down from 74% year-on-year.Core operating expenses were up 1%, or 5% at constant currency, to $3.37bn, which represented 61% of total revenue, down from 65%.Reported research and development expenses slipped 1%, but rose 3% at constant exchange rates, to $1.27bn, with core research and development expenses falling by 1%, but rising 3% at constant currency, to $1.23bn.Reported selling, general and administrative expenses increased 2%, or 7% at constant exchange rates, to $2.51bn, while core selling, general and administrative expenses were 2% higher, or 6% higher at constant currency, at $2.07bn, which the board said reflected ongoing additional support for new medicines and growth in China.Reported other operating income and expenses increased by 26%, or 27% at constant exchange rates, to $593m, which AstraZeneca said primarily reflected the impact of the divestment of US rights to Synagis, with core other operating income and expenses rising by 379%, or 383% at constant currency, to $594m.The company's reported operating margin increased by seven percentage points to 20%, and its core operating margin rose by 13 percentage points to 30%.Reported earnings per share totalled 47 US cents, based on a weighted-average number of shares of 1,267m, which represented an increase of 75% or 90% at constant exchange rates.Its reported tax rate was 26%, up from 16% year-on-year, while core earnings per share increased by 85%, or 100% at constant exchange rates, to 89 cents.The firm's core tax rate rose to 23% from 18% year-on-year, which reflected the geographical mix of profits and the impact of divestment transactions."Our 14% product sales growth in the quarter reflected the success of our new medicines and emerging markets," said AstraZeneca chief executive officer Pascal Soriot."In oncology, 'Tagrisso', 'Imfinzi' and 'Lynparza' continued to do well and, in BioPharma, 'Farxiga', 'Brilinta' and 'Fasenra' also grew strongly."Emerging markets - our largest sales region - delivered an outstanding performance with a 22% growth rate; all of its sub-regions grew strongly, including China at 28%."Soriot noted that the company's core operating profit almost doubled, which he said demonstrated "strong" operating-margin improvement."Together with this encouraging financial start to the year, our highly-productive and sustainable pipeline continued to deliver, notably with a regulatory approval for Lynparza in the EU for the treatment of metastatic breast cancer and approvals of Farxiga in type-1 diabetes."The recently-announced collaboration with Daiichi Sankyo also broadened an exciting oncology portfolio with a potentially-transformative cancer treatment that could benefit patients around the world."We appreciate the support from our shareholders in realising this exceptional opportunity."