GSK improves profit outlook after Q3 beats expectations

© Reuters. FILE PHOTO: Company logo of pharmaceutical company GlaxoSmithKline is seen at their Stevenage facility, Britain October 26, 2020. REUTERS/Matthew Childs/File Photo GLOBAL BUSINESS WEEK AHEAD

(Reuters) – Britain’s GSK delivered better-than-expected third-quarter results on Wednesday and raised its annual profit outlook, boosted by strong sales of key drugs and cost cutting ahead of a planned split next year.

The drugmaker now expects 2021 adjusted earnings per share to decline by between 2% and 4% at constant exchange rates, excluding any boost from its COVID-19 offerings. GSK previously expected profit to fall by mid-to-high single digit percentages.

Turnover at the world’s biggest vaccine maker by sales rose 5% to 9.07 billion pounds ($12.5 billion) for the three months to Sept. 30, while adjusted earnings were up 3% to 36.6 pence per share.

Analysts had expected third-quarter earnings of 29.4 pence per share on sales of 8.73 billion pounds, a company-compiled consensus showed.

GSK stuck by its plan to spin off its consumer health business in 2022, after a report the unit could attract bids from private equity firms.

Activist investors Elliott and Bluebell have called for a sale of the unit, among other proposals for “New GSK”, including leadership changes.

“We also continue to make excellent progress towards unlocking the value of Consumer Healthcare through a successful demerger in mid-2022,” GSK CEO Emma Walmsley said in Wednesday’s results statement.

($1 = 0.7272 pounds)

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