Novo Nordisk (NOVO) Q2 2024 earnings summary

Executive summary

• Sales grew 25% at constant exchange rates (CER) in H1 2024 to DKK 133.4bn, driven by strong demand for GLP-1-based diabetes and obesity treatments, with operating profit up 19% at CER despite a DKK 5.7bn impairment loss on ocedurenone.

• Net profit increased by 16% to DKK 45.5bn, and diluted EPS rose 17% to DKK 10.17.

• Free cash flow was DKK 41.3bn, down from DKK 45.5bn last year, mainly due to higher capital expenditure.

• Now serving over 42 million patients globally, with significant market share gains in both North America and international operations.

• Raised full-year outlook for both sales and operating profit growth, reflecting robust commercial execution and supply chain improvements.

Financial highlights

• Total sales increased by 25% at CER; North America operations grew 36%, international operations 11%.

• GLP-1 diabetes sales rose 32%, insulin sales 10%, and obesity care sales 37% year-over-year.

• Gross margin was 84.9% (down from 85.1% in H1 2023) due to higher capacity expansion costs.

• EBITDA increased 32% to DKK 69.5bn.

• Capital expenditure rose 79% to DKK 18.9bn, mainly for manufacturing expansion.

Outlook and guidance

• Upgraded 2024 sales growth outlook to 22–28% and operating profit growth to 20–28% at CER; DKK growth expected about 1 percentage point lower due to FX.

• Free cash flow guidance raised to DKK 59–69bn; capex expected around DKK 45bn.

• Effective tax rate expected at 19–21%.

• Guidance reflects continued strong volume growth in GLP-1-based treatments and ongoing supply constraints.

• Net financial items projected as a loss of around DKK 0.5bn.