GSK 2Q Operating Profit Slipped Despite Higher Sales; Raises 2022 Outlook -- Update

By Joe Hoppe

GSK PLC said Wednesday that its second quarter operating profit fell from the previous year though sales grew, and raised its outlook for 2022.

The British pharmaceutical major posted an operating profit of 1.08 billion pounds ($1.30 billion) for the period, down from GBP1.28 billion the year prior, primarily reflecting higher accounting charges for reassessing liabilities, it said.

Adjusted earnings per share was 34.7 pence compared with 23 pence for the same period a year earlier.

Sales came in at GBP6.93 billion, up from GBP5.84 billion for the second quarter of 2021, reflecting a strong performance across all three of its product groups, the company said. Specialty medicine sales rose 44% on an annual equivalent rate, while general medicines rose 5% and vaccine turnover rose 9% on year, GSK said.

The company raised its outlook for 2022, saying that it now expects sales growth of 6% to 8% and adjusted operating profit growth of between 13% and 15%, both at constant exchange rates. The boost particularly reflects exceptional second quarter results for Shingrix, its shingle vaccine, and expectations for it to achieve record annual growth.

The company had previously expected sales to grow 5% to 7% and adjusted operating profit to rise 12% to 14%.

GSK said it expects slightly lower growth in the second half of 2022, due to a more challenging comparative period for sales and an expected increase in research and development spend. Uncertain economic conditions notwithstanding, GSK said it has also seen evidence of healthcare systems recovering from the Covid-19 pandemic.

The board declared a dividend of 16.25 pence a share for the second quarter and said it continues to expect a dividend of 61.25 pence a share for the full-year.

"Improvements in [research and development] and operating performance, together with a strengthened post-demerger balance sheet, create new capacity and flexibility for GSK to invest in growth and innovation for patients and shareholders," Chief Executive Emma Walmsley said.

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(END) Dow Jones Newswires

July 27, 2022 03:11 ET (07:11 GMT)

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