GSK delivers sales of £7.7 billion +6% AER, +5% CER

Issued: London, UK

Total EPS 16.8p, +50% AER, +42% CER; Adjusted EPS 30.1p, +22% AER, +18% CER

Financial highlights

• Pharmaceuticals sales £4.2 billion, +4% AER, +2% CER; Vaccines £1.5 billion, +23% AER, +20% CER; Consumer Healthcare £2.0 billion, flat AER, +1% CER.
• Total Group operating margin 18.6%. Adjusted Group operating margin 28.2%, +1.6 percentage points AER, +1.0 percentage point CER (Pharmaceuticals 29.8%; Vaccines 40.3%; Consumer Healthcare 21.7%). Benefits from strong sales growth and phasing of R&D.
• Total EPS 16.8p, +50% AER, +42% CER.
• Adjusted EPS 30.1p, +22% AER, +18% CER, driven by strong operating performance, continued financial efficiencies, reduction in minority share and a one-off benefit to associates.
• Net cash flow from operations £663 million. Free cash flow £165 million.
• 19p dividend declared for the quarter; continue to expect 80p for full year 2019.
• 2019 Guidance reaffirmed.

Product and pipeline highlights​

• Total HIV sales £1.1 billion, +7% AER, +4% CER, including Juluca sales of £70 million.
  Dovato (dolutegravir+lamivudine), first once-daily 2-drug regimen for treatment-naive HIV patients, launched in US.
  Long-acting cabotegravir+rilpivirine filed in the US for treatment of HIV.
• Total new Respiratory product sales £631 million, +29% AER, +25% CER, including Trelegy £87 million; Nucala £152 million.
• Shingrix sales £357 million driven by continued strong launch execution in US.
• Continued progress in immuno-oncology pipeline:
  Zejula sales of £42 million since 22 January following completion of Tesaro acquisition
  Positive data from GARNET study presented at the Society of Gynecologic Oncology conference indicating robust activity of PD-1 dostarlimab in patients with advanced or recurrent endometrial cancer
  Global alliance with Merck KGaA, Darmstadt, Germany completed to jointly develop and commercialise M7824,
  a novel immunotherapy with potential in multiple difficult-to-treat cancers
  Further positive data announced from belantamab mafodotin (BCMA) DREAMM-1 study and reported in Blood Cancer Journal

Emma Walmsley, Chief Executive Officer, GSK said:

“We have made a strong start to 2019, which is an important year of execution for GSK, with growth in sales, operating margins and earnings per share in Q1, in line with our expectations.  Strengthening our pipeline remains our number one priority and we reported positive data for several potential new medicines in HIV and Oncology during the quarter.  I am also pleased to report that integration planning for our new proposed Consumer Healthcare business is going well and, subject to relevant approvals, we continue to expect to complete this transaction in the second half of the year. We look forward to building on the progress made this quarter.”

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