GlaxoSmithKline Reports Growing Turnover and Profit in 1Q, Beating Market Expectations

By Carlo Martuscelli

GlaxoSmithKline PLC (GSK.LN) said Wednesday that pretax profit rose 17% in the first quarter as the British pharmaceutical major beat analyst expectations at both the top and bottom line.

Profit before tax for the quarter was 1.30 billion pounds ($1.68 billion), up from GBP1.11 billion the year before, the company said. Turnover rose 6.1% to GBP7.66 billion, beating analyst expectations GBP7.54 billion.

The company reported growth across its respiratory, HIV and immunoinflamation divisions. However, the established pharmaceuticals saw revenue decline by 5% as sales of its respiratory drug Advair fell, hit by the introduction of a generic version of the medicine developed by Mylan NV (MYL).

Adjusted earnings per share--a metric closely watched by analysts--totaled 30.1 pence, ahead of market expectations of 25.9 pence, based on a FactSet consensus forecast. Glaxo said it benefited from an improved trading performance, as well as from bringing its consumer health-care division fully under its control last year.

The drugmaker said it expects the restructuring program to cost GBP1.75 billion over the period to 2021, and it is expected to deliver annual savings of around GBP450 million. These will be reinvested to fund research and commercially support new products, it added.

The company reiterated its guidance of a decline in adjusted earnings per share of between 5% to 9% at constant exchange rates in 2019.

It declared a quarterly dividend of 19 pence per share, and continues to expect a full-year dividend of 80 pence.

Glaxo's Chief Executive Emma Walmsley said that integration planning for the proposed Consumer Healthcare joint venture with Pfizer Inc. (PFE) is going well.

The transaction is expected to complete in the second half of the year, she added.

Write to Carlo Martuscelli at [e-mail]

(END) Dow Jones Newswires

May 01, 2019 07:43 ET (11:43 GMT)

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