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GlaxoSmithKline PLC on Wednesday reported a higher quarterly profit as it announced it is on track to demerge and list its consumer healthcare arm Haleon.
Under demerging plans, the company aims for GSK consumer healthcare to become Haleon in July, leaving a biopharma-focused 'New GSK'. The split has been in the works since early 2020.
Haleon will house brands such as Sensodyne toothpaste, Panadol & Advil pain relief, and Centrum vitamins.
Pretax profit rose by 71% to £2.60 billion from £1.52 billion in the quarter ended March 31 compared to a year ago. Sales increased to £9.78 billion from £7.42 billion year-on-year.
‘Our results reflect further good momentum across specialty medicines and vaccines, including the return to strong sales growth for Shingrix and continuing pipeline progress,’ commented Chief Executive Officer Emma Walmsley in a press release.
Shingrix is a shingles vaccine for adults aged 50 and over.
‘We also continue to see very good momentum in Consumer Healthcare, demonstrating strong potential of this business ahead of its proposed demerger in July, to become Haleon,’ Walmsley added.
GSK will propose a lower quarterly dividend of 14 pence per share, down from 19p in 2021's first quarter. Under its new dividend policy, GSK expects to declare a dividend of 27p for the first half year, out of which the new GSK will receive 22p and consumer healthcare, soon to be Haleon, 5p. For 2023, the Brentford, England-based pharmaceutical company aims to declare a dividend of 45p per share.
The firm expects an adjusted operating profit growth of 12% to 14% in 2022, excluding any contribution from Covid-19 solutions. It sees itself continuing to deliver on its strategic priorities, GSK said.
Covid-19 solutions will contribute a similar sales level to 2021, ‘but at a substantially reduced profit contribution due to the increased proportion of lower margin Xevudy sales,’ the pharmaceutical firm said. Xevudy is a Covid-19 antibody medicine GSK developed with San-Francisco based immunology company Vir Biotechnology.
‘The overwhelming majority of expected Covid-19 solutions sales were achieved in the first quarter this year,’ GSK explained.
Due to the surge of the Omicron BA.2 sub-variant, Xevudy is no longer authorised for Covid-treatment in any US region, the seventh largest London-listed company by market capitalisation added.
GlaxoSmithKline shares were 0.6% higher at 1,765.00 pence each in London on Wednesday morning.
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