GSK PLC on Wednesday backed its full-year guidance following ‘another quarter of sales and core operating profit growth’, despite a third-quarter profit slump driven by legal charges.
The London-based pharmaceutical and biotechnology firm said pretax profit in the third quarter to September 30 dropped 96% to £64 million from £1.79 billion the year before, as its bottom line was hit by a £1.8 billion charge in relation to a Zantac court settlement.
Core operating profit, however, only fell 0.4% during the quarter to £2.76 billion from £2.77 billion the year before. This reflected ‘strong’ specialty medicine sales and cost management efforts, GSK said.
Pretax profit for the year to date was £2.91 billion, down 49% from £5.69 billion last year. Core operating profit for the year to date was £7.71 billion.
Meanwhile, revenue for the three-month period fell 1.7% to £8.01 billion from £8.15 billion last year. Revenue for the nine months, however, was up 4.4% to £23.26 billion from £22.28 billion.
GSK experienced a ‘lower than anticipated’ demand for vaccines during the quarter, and revised its full-year vaccine revenue guidance to a low-single digit percentage decrease from its previously expected low to mid-single digit increase.
However, growth in specialty medicines sales partly offset lower vaccine sales, as GSK lifted its specialty medicines guidance to a high teens percentage increase, up from a mid to high teens increase. General medicines sales guidance was also lifted, to a mid-single digit increase from a low to mid-single digit increase.
GSK declared a third-quarter dividend of 15.00 pence per share, unchanged from the second quarter, but up 7.1% from 14.00p per share last year. It continues to expect a total dividend of 60.00p per share, which would be up 3.4% from 58.00p in 2023.
Looking ahead, GSK maintains its yearly guidance, forecasting revenue growth of between 7% and 9%, and core operating profit growth of between 11% and 13%.
Chief Executive Officer Emma Walmsley said: ‘We have delivered another quarter of sales and core operating profit growth, and further good progress in research & development. Strong growth in specialty medicines helped to offset lower vaccine sales and reflected successful new product launches in oncology and HIV, as well as the resilience we have now built into GSK’s portfolio and performance.
‘Our pipeline continues to strengthen with 11 positive phase 3 trials reported so far this year and we are currently planning launches for 5 major new product approval opportunities next year: Blenrep, Depemokimab, Nucala for [chronic obstructive pulmonary disease], Gepotidacin, and our new vaccine to prevent meningitis (MenABCWY).
‘We also resolved the vast majority of Zantac litigation in the quarter, to remove uncertainty, and so we can focus forward. All this means we are on track to deliver our 2024 guidance, and we are even more confident in our 2026 and 2031 outlooks.’
Shares in GSK were down 3.2% at 1,405.50 pence each in London on Wednesday morning.
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