Drugs giant GSK logs slump in quarterly profit

29th July 2015, Comments 0 comments

British drugmaker GlaxoSmithKline on Wednesday posted slumping quarterly earnings, hit partly by lower profit margins for vaccines acquired under an asset swap deal with Swiss peer Novartis.

Earnings after taxation tumbled 77 percent to £149 million ($232 million, 210 million euros) in the three months to June, compared with a year earlier, GSK said in a results statement. Turnover grew seven percent to £5.89 billion.

Adjusted operating profit meanwhile slid four percent to £1.349 billion in the reporting period.

The group said its performance reflected "the disposal of GSK's higher margin oncology business and the acquisition of lower margin vaccines and consumer healthcare businesses from Novartis".

GSK sold its oncology business to Novartis last year for $16 billion, while buying the Swiss group's vaccines division in return, in a deal that completed in the first quarter. The pair also formed a joint venture for consumer health products.

"This is our first full quarter of performance since completion of the transaction with Novartis and it is encouraging," said Chief Executive Andrew Witty.

"Our integration and restructuring plans are on track and we remain confident that we can achieve our targets for this year and return the group to earnings growth in 2016."

jmi-rfj/bc


© 2015 AFP

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