...September 25, 2023 Roche Holding AG's (Roche's) performance in the first half of 2023 demonstrates its solid business operation and is in line with our base case. Roche reported half-year 2023 results of Swiss franc (CHF) 29.8 billion. The 8% sales increase on a CER (constant exchange rate) in its pharmaceutical division did not fully offset the sales decline of 23% CER in the diagnostics division. The decline mainly resulted from the normalization of diagnostics activities on the back of the sharp testing decline following the COVID-19 pandemic. Currency exchange rate headwinds on the Swiss franc also had a negative effect on the company's revenues but remain in line with our previous forecasts. We expect Roche will maintain EBITDA margins close to 40% and leverage well below 1x in 2023 and 2024. We do not anticipate major acquisitions but consider that Roche has a proven track record of deleveraging quickly, as was the case in 2022 when Roche bought back $20.7 billion in shares from Novartis....
