GSK reveals ‘solid’ results
GlaxoSmithKline, Europe’s largest pharmaceutical company, has reported weaker-than-expected growth for the three months to the end of June.
The UK drugs firm said turnover for the quarter came was £5.3bn – down by 1% on the same period last year.
But the company blamed the decline on the weakness of the dollar against sterling.
And its pre-tax profits were up by 15% compared with the second quarter in 2002, giving welcome relief to the beleaguered shareholders, who have seen the value of the stock slide in recent years.
Chief executive Jean-Pierre Garnier described it as “another solid performance” from the company, and the City seemed to agree with the share price shooting up by 3% during the day.
Mr. Garnier also suggested that the results would improve as the year goes on, stating “we now expect earnings per share growth of high single digits or better in 2003”.
That optimism comes despite the threat of generic rivals for the company’s leading brands.
GSK lost £300m in Augmentin sales in the US during the first half of the year alone, and is expected to face tough competition for its anti-depressant, Paxil (sold as Seroxat in the UK).
The company’s asthma drug, Advair, remains its number one product, with sales up by over 40% in the US. The company is now trying to expand its use by seeking permission for it to be supplied on prescription to children in America, and for the treatment of chronic obstructive pulmonary disease in Europe.
Its diabetes and HIV treatments also performed well, and GSK hopes to launch Levitra – its answer to Viagra – in the US later this year.
