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Britain's GSK lifts profit outlook after sales help it beat forecasts

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By Reuters
GSK improves profit outlook after Q3 beats expectations
GSK improves profit outlook after Q3 beats expectations   -   Copyright  Thomson Reuters 2021   -  

<div> <p>By Pushkala Aripaka</p> <p> – Britain’s <span class="caps">GSK</span> delivered better-than-expected third-quarter results and raised its annual profit outlook, lifting its shares on Wednesday after strong sales of key drugs and cost cutting ahead of a planned split next year.</p> <p><span class="caps">GSK</span> now expects 2021 adjusted earnings per share to decline by between 2% and 4% at constant exchange rates, excluding any boost from its <span class="caps">COVID</span>-19 offerings. It had previously expected profit to fall by mid-to-high single digit percentages.</p> <p>The results and outlook sent <span class="caps">GSK</span>’s London-listed shares up 2.1% in early afternoon trade, after hitting seven-week highs.</p> <p>The improved outlook rests on expected pharmaceuticals sales growth, despite a forecast for lower vaccine sales as a surge in the more-infectious coronavirus Delta variant delayed an expected recovery, including its key shingles vaccine, Shingrix.</p> <p>“As people didn’t want to go out and leave their houses and (health systems) were really prioritising mass scale vaccination, that was the main hit. These are deferred and not lost sales for sure and it’s good to see us firmly on the recovery track,” <span class="caps">GSK</span> <span class="caps">CEO</span> Emma Walmsley said on a results call.</p> <p>Turnover at the world’s biggest vaccine maker by sales rose 5% to 9.07 billion pounds ($12.5 billion) for the three months to Sept. 30, while adjusted earnings were up 3% to 36.6 pence per share.</p> <p>Analysts had expected third-quarter earnings of 29.4 pence per share on sales of 8.73 billion pounds, a company-compiled consensus showed.</p> <p><span class="caps">GSK</span> said it was sticking with its plan to spin off consumer health in 2022, after a report the business could attract bids from private equity firms. </p> <p>Activist investors Elliott and Bluebell have called for a sale of the unit, among other proposals for “New <span class="caps">GSK</span>”, including leadership changes.</p> <p>“We also continue to make excellent progress towards unlocking the value of Consumer Healthcare through a successful demerger in mid-2022,” Walmsley said in Wednesday’s statement.</p> <p>A new chair of the consumer healthcare business is expected to be announced before the end of the year, <span class="caps">GSK</span> said.</p> <p>($1 = 0.7272 pounds) </p> <p/> </div>