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GlaxoSmithKline Reports Strong Full Year Numbers

Pharmaceutical giant GlaxoSmithKline has reported rising full year sales and profits, while pointing to a pipeline of new products that will help its performance in 2018.

The company saw turnover rise 3% at constant exchange rates to £30.2 billion, while adjusted operating profit increased 5% to £8.56 billion.

Glaxo said its performance was helped by successful respiratory treatments and HIV products.

All three of the group’s divisions – pharmaceuticals, vaccines and consumer healthcare – posted solid sales growth.

In the fourth quarter, revenue rose 4% to £7.63 billion, with profit 5% up at £2 billion.

Chief executive Emma Walmsley, who took the top job last year, said: “In 2017 GSK delivered encouraging results from across the company with sales growth in each of our three global businesses.

“With the sales momentum we anticipate from new and recent launches and focused improvements in operating performance we are increasingly confident in our ability to deliver mid to high single digit growth in adjusted earning per share.”

But Ms Walmsley, delivering her first set of full year results, said forward guidance was dependent on the impact of a possible generic competition to Glaxo’s Advair asthma treatment in the US.

Should no generic competitor arrive onto the market in 2018, adjusted earnings per share was expected to grow between 4% and 7%.

In the event of a mid-year introduction of a competitor in the US, that could fall to 3%.

But Glaxo pointed to three new product launches expected to boost the firm this year.

Trelegy Ellipta, which provides three medicines in a single inhaler to treat lung conditions, Juluca, the first two-drug regimen, once-daily, single pill for HIV, and Shingrix, a new vaccine for the prevention of shingles.

Shares were up over 2% in afternoon trading to 1,269p.

Glaxo also booked a £1.6 billion charged related to US president Donald Trump’s tax reform but, like other big firms, will benefit in the long run.

Roger Franklin, analyst at Liberum, said: “GSK has delivered a strong set of numbers which beat at the top-line for quarter four in all the right places and delivered a bottom line beat albeit from tax and financials.

“The guidance for 2018 is encouraging and we believe is about 1% ahead of consensus expectations.

“This should settle nerves on the company’s expectations for HIV in a year when new competition is expected. We are also encouraged by the company being ‘increasingly confident’ in the longer term guidance to 2020.”

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