Frequently Asked Questions. Novartis shares. Key Novartis share data. Published on Novartis ( Tab:

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1 Published on Novartis ( Home > Printer-friendly PDF > Frequently Asked Questions Frequently Asked Questions Tab: Novartis shares Where are Novartis shares traded? Novartis shares are listed and traded on the SIX Swiss Exchange (Valor No , ISIN CH , symbol: NOVN) as well as on the NYSE in the form of American Depositary Receipts (ADR) (Valor No , ISIN US66987V1098, symbol: NVS). What are the ticker symbols for Novartis? Shares SIX (Reuters / Bloomberg) NOVN.S / NOVN SW ADRs NYSE (Reuters / Bloomberg) NVS / NVS US What is an ADR/ADS? ADR stands for American Depositary Receipt. ADS stands for American Depositary Share. An ADR is a receipt for a number of shares of a foreign-based corporation held by a US depositary bank, entitling the ADR holder to all dividends and capital gains. What is the number of outstanding shares in Novartis? Key Novartis share data (calculated on average number of shares outstanding) Issued shares

2 Treasury shares Outstanding shares at December 31 Weighted average number of shares outstanding Approximately 135 million treasury shares (2015: 137 million; 2014: 153 million) are held in entities that restrict their availability for use. What is the number of outstanding ADRs in Novartis? Key data on ADRs issued in the US Year-end ADR price (USD) ADRs outstanding The depositary, JP Morgan Chase Bank, holds one Novartis AG share for every American Depositary Receipt (ADR) issued. Where can I find historical data for Novartis shares? You may use the interactive Share Monitor [1] under our Share Data & Analysis section to find the closing share price on a specific day. What is the date of your Annual General Meeting? The Annual General Meeting 2017 took place on February 28, 2017 in Basel, Switzerland. The Annual General Meeting 2018 will take place on March 02, 2018 in Basel, Switzerland. Visit the Annual General Meeting section [2] Visit the Event Calendar [3]

3 When is your dividend going to be paid? The dividend payment date has been set for March 6, What is the dividend history for Novartis shares? The Novartis dividend has increased steadily since The Board proposed a 2% increase in the dividend payment for 2016 to CHF 2.75 per Novartis share (2015: CHF 2.70), and this was approved at the Annual General Meeting on February 28, This represents the 20th consecutive increase in the dividend paid per share since the creation of Novartis AG in December The dividend payment date has been set for March 6, Learn more about dividend information [4] How can I obtain the minutes of the Annual General Meeting? A summary in German of our Annual General Meeting (AGM) 2017 is available in our Annual General Meeting [2] section. ADR Shareholders [5] What is the amount and timing of the next dividend payment? A dividend of CHF 2.75 was approved by our shareholders at the Annual General Meeting of Novartis AG, held on February 28, This dividend was paid on March 6th, 2017 (the Swiss payment date). Is the dividend on the Novartis ordinary share and the Novartis ADR the same?

4 Yes, however, since ADR holders will receive their dividend in US dollars, the amount received will be impacted by currency exchange rates, as well as by a handling fee (historically, $0.01 per share) associated with the ADR dividend. An estimate of the amount of the US dollar dividend for the ADR will be calculated on the day of the dividend announcement based on that day s exchange rates. The actual exchange rate will be determined once all funds are received and exchanged by JP Morgan, the depository bank. Will the entire dividend amount be converted into US dollars on the Swiss payment date of March 6th? On the Swiss payment date, 65% of the dividend will be received by JP Morgan. JP Morgan will convert this amount to US dollars at or shortly after such receipt. Why does JP Morgan receive 65% of the full dividend amount on the Swiss payment date? A withholding tax of 35% is applied on the gross dividend amount paid by Novartis AG. This withholding tax is paid by Novartis AG to the Swiss Tax Authorities (STA) within 30 days after the Swiss payment date. The STA then requires investors to follow a procedure to reclaim the withholding taxes, if they are eligible to do so. JP Morgan carries out this procedure on behalf of the ADR holders. Under this procedure, investors certify and elect their tax status and their entitlement to reclaim the withholding tax by providing the necessary disclosure documentation. This procedure is required by the tax treaty between the U.S. and Switzerland. When will the withheld funds be recovered from the Swiss Tax Authorities and converted into US dollars? This generally occurs approximately six weeks after the Swiss payment date. Once the funds are received by JP Morgan, and converted into US dollars, the ADR dividend will be paid to ADR holders shortly thereafter. How does the process to reclaim the withheld funds work? JP Morgan carries out this process on behalf of the ADR holders. The process permits banks and brokers within the Depository Trust Company to elect their clients correct tax status electronically and to provide documentation on behalf of their clients to the STA. Please contact JP Morgan / Global Tax at with further questions. What is the process for reclaiming funds back from the STA? Under the process for reclaiming withheld dividends, JP Morgan may only indicate the ADR

5 holders tax status after the ADR record date, which is one day prior to the Swiss payment date. Eligible holders of ADRs are given 14 days to complete and submit their election. The STA then takes approximately 15 days to process requests received to reclaim the withheld dividends. How much of my dividend will be withheld for foreign tax? You need to check with your tax advisor or local tax authority, as this rate varies depending on your tax status. Could the ADR dividend be made in two payments? To minimize confusion to ADR holders and the overall market, a procedure was established to pay ADR holders in one payment rather than two. When will the final/definitive rate and ADR payment date be determined? The final conversion rate and ADR payment date will be determined once the withheld funds are received from the STA by JP Morgan and converted into US dollars. This will be formally announced by JP Morgan. Is there a contact for general questions surrounding the ADR program? You can contact JP Morgan at or visit the website at [6]. JP Morgan is the depository bank for Novartis ADRs and performs the role of dividend paying agent. Financial questions [7] How do you calculate your earning per share? Basic earnings per share (EPS) is calculated by dividing net income attributable to shareholders of Novartis AG by the weighted average number of shares outstanding in a reporting period. This calculation excludes the average number of issued shares purchased

6 by the Group and held as treasury shares. Per-share information Weighted average number of shares outstanding used in basic earnings per share (in millions) 2,378 2,403 2,426 Basic earnings per share (USD) - Continuing operations Discontinued operations Total Learn more about share ownership [8] When does the fiscal year end for Novartis? Novartis uses the 12-month calendar year, ending December 31, as its fiscal year. Are there any limitations on voting rights for registered shareholders? The company s Articles of Incorporation state that no person or entity shall be registered with the right to vote for more than 2% of the share capital as set forth in the Commercial Register. In particular cases, the Board of Directors may allow exemptions from the limitation for registration in the share register. According to the share register, shareholders owning 2% or more of the Company s capital at December 31, excluding treasury shares held by Novartis AG and its subsidiaries that restrict their availability for use, are as follows: % holding of share capital December 31, 2016 % holding of share capital December 31, 2015 Novartis Foundation for Employee Participation, Basel Emasan AG, Basel

7 % holding of share capital December 31, 2016 % holding of share capital December 31, 2015 UBS Fund Management (Switzerland) AG, Basel Where can I find historical financial information about Novartis? You can review quarterly and full-year historical financial information in the Financial Data [9] and Event Calendar [3] sections. What is the exposure to exchange rate risk for Novartis? We transact our business in many currencies other than the US dollar, our reporting currency. The following provides an overview of net sales and operating expenses for our continuing operations based on IFRS values for 2016 and 2015 for currencies most important to the Group: Currency 2016 % 2015 % US dollar (USD) Net sales Operating expenses Euro (EUR) Net sales Operating expenses Swiss franc (CHF) Net sales 2 2 Operating expenses Japanese yen (JPY) Net sales 7 6 Operating expenses 5 4 Chinese yuan (CNY) Net sales 4 4 Operating expenses 3 3 British pound (GBP) Net sales 3 3 Operating expenses 2 3 Canadian dollar (CAD) Net sales 3 3

8 Operating expenses 1 1 Brazilian real (BRL) Net sales 2 2 Operating expenses 1 2 Australian dollar (AUD) Net sales 2 2 Operating expenses 1 1 Russian ruble (RUB) Net sales 1 1 Operating expenses 1 1 Other currencies Net sales Operating expenses 5 7 Operating expenses in the above table include cost of goods sold, Marketing & Sales, Research & Development, General & Administration, Other income and Other expense. We prepare our consolidated financial statements in US dollars. As a result, fluctuations in the exchange rates between the US dollar and other currencies can have a significant effect on both the Group s results of operations as well as on the reported value of our assets, liabilities and cash flows. This in turn may significantly affect reported earnings (both positively and negatively) and the comparability of period-to-period results of operations. For purposes of our consolidated balance sheets, we translate assets and liabilities denominated in other currencies into US dollars at the prevailing market exchange rates as of the relevant balance sheet date. For purposes of the Group s consolidated income and cash flow statements, revenue, expense and cash flow items in local currencies are translated into US dollars at average exchange rates prevailing during the relevant period. As a result, even if the amounts or values of these items remain unchanged in the respective local currency, changes in exchange rates have an impact on the amounts or values of these items in our consolidated financial statements. Because our expenditures in Swiss francs are significantly higher than our revenues in Swiss francs, volatility in the value of the Swiss franc can have a significant impact on the reported value of our earnings, assets and liabilities, and the timing and extent of such volatility can be difficult to predict. In addition, there is a risk that certain countries could take steps which could significantly impact the value of their currencies. What accounting convention does Novartis follow?

9 Our significant accounting policies are set out in Note 1 to the Group s consolidated financial statements, which are prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). Given the uncertainties inherent in our business activities, we must make certain estimates and assumptions that require difficult, subjective and complex judgments. Because of uncertainties inherent in such judgments, actual outcomes and results may differ from our assumptions and estimates, which could materially affect the Group s consolidated financial statements. Application of the following accounting policies requires certain assumptions and estimates that have the potential for the most significant impact on our consolidated financial statements. How can I get a copy of your Annual Report? You will find detailed information about the 2016 Annual Report in our Annual Report [10] section. Services [11] How can I obtain SEC documents, such as the 10-K or 20-F? Because Novartis is a Swiss firm, we do not file some SEC documents (e.g., Forms 10-K and 10-Q). Instead, our results are reported to the SEC in the Form 20-F. View or download the 20-F report [12] How can I get information on your key pharmaceutical products? An overview of our key products is available in our Product Portfolio [13] section. How can I get information on the dates Novartis will report sales and earnings? Please check the Novartis investor relations reporting dates in our Event Calendar [3].

10 Can I subscribe to receive Novartis news automatically? We have a subscription form online where you can register to receive information. Each time something new is published on the investor relations section of our website, you will receive an alert by . Subscribe to our news [14] Source URL: Links [1] [2] [3] [4] [5] [6] [7] [8] [9] [10] [11] [12] [13] [14]