GSK ups 2024 guidance as HIV drugs and new vaccines boost its bottom line

By Louis Goss

GSK on Tuesday upped its 2024 profit guidance, as surging sales of its HIV drugs and recently launched shingles vaccine saw it beat analyst expectations in the first quarter of the year.

The FTSE-100 drugmaker posted a 10% increase in first-quarter sales, to GBP7.4 billion, driven by 14% higher sales of its HIV drugs and a 13% surge in sales of its shingles vaccine Shingrix to GBP900 million.

The British firm beat analysts' forecasts in posting a 17% increase in its core operating profits, to GBP2.4 billion, compared to the GBP2.1 billion predicted by 14 analysts polled by GSK itself.

GSK, in turn, upped its guidance for the full-year 2024, as the pharma company said it now expects its core operating profits will grow by 9-11%, compared to its previous range of 7-10%.

"We have made a strong start to 2024, with another quarter of excellent performance and continued pipeline progress, including positive data read outs for 4 phase III medicines," GSK CEO Emma Walmsley said.

"We expect this strong momentum to continue, and look forward to delivering another year of meaningful growth in sales and earnings in 2024," the GSK chief said.

Shares in GSK (UK:GSK) (GSK), listed on the London Stock Exchange, increased 1% on Tuesday having gained 17% in the year-to-date.

A ruling in favor of GSK, in a dispute with its rival AstraZeneca (UK:AZN) over royalties on ovarian cancer drug Zejula, also boosted the Brentford headquartered company's balance sheet.

GSK's results follow the company's successful spin off of its consumer health arm Haleon, which saw it float the company in London and New York in July 2022.

The pharma giant said the value of the 4.2% stake it continues to hold in Haleon had increased by GBP57 million, in a gain that helped offset higher costs relating to currency exchange rates.

Haleon on Tuesday also posted first-quarter results, in which the Advil maker reported a 2.2% drop in its revenue, to GBP2.9 billion, which it blamed on "tough comparatives" compared to a year ago.

The Weybridge, Surrey headquartered company posted a drop in sales of its painkillers and cold and flu drugs, compared to the first quarter of 2023, when demand for over-the-counter drugs surged in the immediate aftermath of COVID-19.

The consumer healthcare company's results follow its announcement on Monday that it is set to shut its U.K. production site that makes Sensodyne toothpaste, leading to the loss of 435 jobs.

Shares in Haleon (UK:HLN) (HLN) fell 2% on Tuesday having gained 3% in the year-to-date and 5% since first being floated on the London Stock Exchange.

-Louis Goss

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05-01-24 0447ET

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