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Glaxo Third-Quarter Earnings Beat Expectations

DOW JONES & COMPANY, INC. 7:36 AM ET 10/22/14
Symbol Last Price Change
GSK 43.63 0 (0%)
QUOTES AS OF 04:04:29 PM ET 10/21/2014


GlaxoSmithKline PLC (GSK) boosted third quarter earnings ahead of expectations Wednesday and announced a new GBP1 billion cost-savings program and management structure, as pressures in its U.S. business continue to drag down sales and compound a tough year for the pharmaceutical giant.

Glaxo's sales fell 10% to GBP5.65 billion in the third quarter, below consensus expectations of GBP5.75 billion, with those of its single best-selling drug Advair falling 13%, as a result of increased competition and pricing pressures in the U.S.

Sales of Glaxo's two new respiratory drugs, Breo and Anoro, for the quarter remained modest at GBP15 million and GBP1 million respectively.

Net profit attributable to shareholders for the quarter fell to GBP401 million, from GBP969 million in the same quarter of the previous year.

Glaxo's core measure of earnings per share came in at 27.9 pence, roughly flat on the same quarter of 2013, and some way ahead of analyst expectations.

Meanwhile Glaxo said it was continuing to explore a sale of a portfolio of its mature drugs in Europe and the U.S. and was considering a partial IPO of its HIV business ViiV Healthcare, which it owns together with Pfizer Inc. and Shionogi.

Glaxo cut its earnings outlook for the full year in May, while in September a Chinese court found the drug maker's local subsidiary guilty of bribery and fined the company nearly $500 million.

Glaxo shares were roughly flat in early afternoon trading in London, after falling roughly 17% in the year to date.

Write to Hester Plumridge at [e-mail]

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10-22-140736ET
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