GlaxoSmithKline has booked a 36 percent rise (14 percent at constant exchange rates) in core profit to £7.8 billion for 2016, driven by a 17 percent leap (6 percent at CER) in revenues to £27.9 billion.
Growth (all at CER) in pharmaceuticals for the year was 3 percent to £16.1 billion, while vaccines were up 14 percent at £4.6 billion and the consumer healthcare segment up nine percent at £7.2 billion.
For the fourth quarter, sales were up 21 percent at £7.59 billion (3 percent CER), overshooting analysts’ expectations with a helping hand from the weak pound and new products, turnover of which leapt 71 percent (at CER) in the period to £1.4 billion.
Core earnings per share jumped up 45 percent (11 percent at CER) at to 26.1 pence.
However, despite the solid results, the firm’s stock dipped more than 1.2 percent as investors reflected on the outgoing chief executive Sir Andrew Witty’s warning that potential generic competition to asthma blockbuster Advair in the US could hit earnings this year.
In the event of no generic competition to Advair in the US, the firm is expecting 2017 core EPS growth to be five to seven percent (CER), but if a copycat is launched on market mid-year, then the drug’s US sales are expected to be around £1 billion, results in core EPS that remains flat to a slight decline in percentage terms.
But Sir Witty reportedly told the media “Once we are through this window of Advair, the company doesn’t really have any material patent expirations until the late 2020s, which is an extraordinarily long period of time”.
“We expect the sales momentum of our new products to continue and, with regulatory decisions on other major product opportunities also expected this year, like Shingrix and Closed Triple, we remain confident in the financial outlook we have previously set out for investors,” he said in a statement.
