* Analyst says statement is almost a profit warning
* Shares fall 3 percent to 6-year low
* Other factors will also hit Q1
(Adds more comment, details)
By Sam Cage
ZURICH, Feb 25 (Reuters) - Novartis AG shares dipped to a
6-year low on Wednesday after the drug maker said first-quarter
results would be hit by the stronger dollar, which analysts said
could amount to a profit warning.
In a statement issued late on Tuesday the Swiss group said
its operating and net income for the first quarter were expected
to be negatively impacted by 8-10 percentage points due to
adverse currency movements.
Its fourth-quarter 2008 results were hit by the higher U.S.
dollar, the currency in which Novartis reports, and the
drugmaker said at the time it expected an "increasingly
challenging environment".
"It is, in effect, almost a form of profit warning from the
Basel company for the first quarter," Wegelin analysts said in a
note on Wednesday.
Novartis shares were down 3.3 percent to 45.46 Swiss francs
by 0922 GMT, a 6-year low and compared with a 1.3 percent drop
in the European health care index. Swiss rival Roche's stock
fell 2.8 percent to 134 francs, having hit a 4-year low.
Pharmaceutical makers like Novartis have proven relatively
resilient in the economic downturn as healthcare is usually one
of the last areas where consumers cut back spending.
But the company is struggling against not only the stronger
U.S. currency but also the looming loss of patent protection for
its top-selling Diovan blood pressure drug and tougher paths to
markets for new products.
Its shares had lost 11 percent so far in 2009 before
Wednesday's session, a sharper drop than the wider European
sector.
"We see consensus reducing full-year '09 estimates by
roughly 2 percent in U.S. dollar terms. In Swiss francs we see
no major impact to Novartis earnings," said Vontobel analyst
Andrew Weiss.
Novartis said its underlying business growth so far in 2009
has been in line with its previous expectations for net sales
growth at a mid-single-digit rate in local currencies.
The group also said other factors -- including the lack of
exceptional gains that boosted the year-ago period and higher
development, marketing and sales investments in the drugs unit
-- would weigh on first quarter results.
(Editing by David Cowell)
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