REG - GSK PLC - 1st Quarter Results
01/05/2024 07:00
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240501:nRSA6992Ma&default-theme=true
RNS Number : 6992M GSK PLC 01 May 2024
GSK makes a strong start to 2024 with improving outlook for the year
Broad-based performance drives sales, profits and earnings growth:
• Total Q1 2024 sales £7.4 billion +10% and +13% ex COVID
• Vaccines sales +16%, +22% ex COVID. Shingrix £0.9 billion +18%,
Arexvy £0.2 billion
• Specialty Medicines sales +17%, +19% ex COVID with HIV +14%
• General Medicines sales +1%. Trelegy £0.6 billion +33%
• Total operating profit and Total EPS for Q1 2024 reflected higher charges for
CCL(2) remeasurement, partly offset by strong Core(1) growth
• Core operating profit +27% (with further positive impact of +8% ex COVID) and
Core EPS +28% (with further positive impact of +9% ex COVID). This reflected
strong sales and SG&A leverage, partly offset by increased investment in
R&D and lower royalty income
• Cash generated from operations exceeded £1 billion with free cash flow of
£0.3 billion
(Financial Performance - Q1 2024 results unless otherwise stated, growth % and
commentary at CER, ex COVID is excluding COVID-19 solutions as defined on page
47).
Q1 2024
£m % AER % CER
Turnover 7,363 6 10
Turnover ex COVID 7,362 8 13
Total operating profit 1,490 (28) (18)
Total operating margin % 20.2% (9.7ppts) (7.8ppts)
Total EPS 25.7p (30) (19)
Core operating profit 2,443 17 27
Core operating margin % 33.2% 3.1ppts 4.6ppts
Core EPS 43.1p 16 28
Cash generated from operations 1,126 >100
R&D delivery and targeted business development supports future growth:
• Strong pipeline progress with positive phase III read outs for gepotidacin in
uncomplicated urogenital gonorrhoea, Cabenuva in HIV treatment, Jemperli in
endometrial cancer, and Blenrep in multiple myeloma
• Innovative Vaccine portfolio further strengthened with regulatory submission
acceptances for Arexvy for prevention of RSV in adults 50-59 (US), new
meningococcal ABCWY vaccine candidate (US), and Shingrix for prevention of
shingles in at-risk adults >18 (China)
• US FDA Fast Track designation received for bepirovirsen in chronic hepatitis B
• New positive data for CAB-ULA as ultra long-acting treatment for HIV supports
progression and transition of HIV portfolio for long-term growth
• US FDA regulatory submission accepted for priority review for Jemperli to
treat endometrial cancer in broader patient populations
• Acquisition of Aiolos Bio completed, expanding respiratory biologics pipeline
with AIO-001, a potentially best-in-class long-acting TSLP monoclonal antibody
for treatment of asthma
2024 guidance updated and dividends:
• Now expect 2024 turnover growth towards the upper part of 5% to 7% range; Core
operating profit growth of 9% to 11% (previously 7% to 10%); Core EPS growth
of 8% to 10% (previously 6% to 9%)
• Dividend declared of 15p for Q1 2024; 60p expected for Full Year 2024
Guidance all at CER and excluding COVID-19 solutions
Emma Walmsley, Chief Executive Officer, GSK:
"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. These, together with other R&D achievements,
mean we have strengthened prospects for growth in all of our key therapeutic
areas this quarter: infectious diseases, HIV, respiratory/immunology and
oncology. We expect this strong momentum to continue, and look forward to
delivering another year of meaningful growth in sales and earnings in 2024."
The Total results are presented in summary above and on page 8 and Core
results reconciliations are presented on pages 20 and 21. (1) GSK has made an
update to its reporting framework in Q1 2024 which is to change the
description of Adjusted results to Core results to align with European peers
in the pharmaceutical industry but with no change to the basis or figures.
Core results are a non-IFRS measure that may be considered in addition to, but
not as a substitute for, or superior to, information presented in accordance
with IFRS. The following terms are defined on page 47: Core results, £% or
AER% growth, CER% growth,COVID-19 solutions, turnover excluding COVID-19
solutions; and other non-IFRS measures. GSK provides guidance on a Core
results basis only, for the reasons set out on page 18. All expectations,
guidance and targets regarding future performance and dividend payments should
be read together with 'Guidance and outlooks, assumptions and cautionary
statements' on page 49. (2) Contingent consideration liability is abbreviated
to CCL.
2024 Guidance
GSK provides its full-year guidance at constant exchange rates (CER). All
expectations and full-year growth rates exclude any contributions from
COVID-19 solutions.
GSK has started 2024 strongly, with business momentum across all product
areas, particularly in Vaccines and Specialty Medicines, including sales
contributions from newly launched vaccines and medicines Arexvy and Ojjaara
respectively. General Medicines, particularly Trelegy, also performed better
than expected. Along with a favourable product mix, GSK benefitted in the
quarter from a successful Zejula royalty dispute appeal, and we also expect
royalty income to be slightly higher for the full year. As a result, GSK has
upgraded its full-year 2024 guidance.
All Guidance excludes the contributions of COVID-19 solutions Current 2024 guidance at CER Previous 2024 guidance at CER
Turnover Increase towards the upper part of the range of between 5% to 7% Increase between 5% to 7%
Core operating profit Increase between 9% to 11% Increase between 7% to 10%
Core earnings per share Increase between 8% to 10% Increase between 6% to 9%
GSK expects first half 2024 sales growth to be higher than second half 2024
due to the comparator to H2 2023, which benefitted from newly launched
vaccines and medicines. In particular, second half 2024, compared to the same
period in the prior year, is expected to be influenced by the 2023 launch
dynamics and initial channel inventory build attributable to Arexvy. In
addition, we expect the majority of Shingrix sales in China in to be in the
first half 2024.
This guidance continues to be supported by the following turnover expectations
for full-year 2024 at CER:
All turnover expectations exclude the contributions of COVID-19 solutions No change to current 2024 expectations at CER
Vaccines Increase of high single-digit to low double-digit per cent in turnover
Specialty Medicines Increase of low double-digit per cent in turnover
General Medicines Decrease of mid-single-digit per cent in turnover
Core Operating profit is expected to grow between 9 to 11 per cent at CER
(previously 7 to 10 per cent increase), despite a 6 percentage point impact to
Operating Profit growth following the loss of the majority of Gardasil
royalties effective from the beginning of 2024. GSK continues to expect to
deliver leverage at a gross margin level due to improved product mix from
Vaccines and Specialty Medicines growth and continued operational
efficiencies. In addition, GSK continues to anticipate further leverage in
Operating Profit due to a step down in SG&A growth to a low single-digit
increase. R&D continues to be expected to increase broadly in line with
sales to support growth of the pipeline.
Core Earnings per share is now expected to increase between 8 to 10 per cent
at CER, reflecting higher operating profit and more favourable net finance
costs. Expectations for non-controlling interests remain unchanged relative to
2023, and GSK continues to anticipate an increase in the Core effective tax
rate to around 17% following implementation of a global minimum corporate
income tax rate aligned with the Organisation for Economic Co-Operation and
Development 'Pillar 2' initiative.
2021-26 and 2031 Outlooks
In January 2024 GSK set out improved outlooks for the period 2021-2026 and for
2031. Please see 2023 Full year and fourth quarter results on gsk.com.
(https://www.gsk.com/en-gb/investors/quarterly-results/)
Additional commentary
Dividend policy
The Dividend policy and the expected pay-out ratio remain unchanged.
Consistent with this, and reflecting strong business performance during the
quarter, GSK expects to declare a dividend for Q1 2024 of 15p per share and
for the full year 2024 60p.
COVID-19 solutions
For the full year 2024, GSK does not anticipate any further COVID-19
pandemic-related sales or operating profit. Consequently, and in comparison to
2023, it is anticipated that the full year growth in sales and Core operating
profit will be adversely impacted by one and two percentage points,
respectively.
Exchange rates
If exchange rates were to hold at the closing rates on 31 March 2024 ($
1.26/£1, € 1.17/£1 and Yen 191/£1) for the rest of 2024, the estimated
impact on 2024 Sterling turnover growth for GSK would be -3% and if exchange
gains or losses were recognised at the same level as in 2023, the estimated
impact on 2024 Sterling Core Operating Profit growth for GSK would be -5%.
Results presentation
A conference call and webcast for investors and analysts of the quarterly
results will be hosted by Emma Walmsley, CEO, at 12 noon BST (US EST at 7am)
on 1 May 2024. Presentation materials will be published on www.gsk.com prior
to the webcast and a transcript of the webcast will be published subsequently.
Notwithstanding the inclusion of weblinks, information available on the
company's website, or from non GSK sources, is not incorporated by reference
into this Results Announcement.
Performance: turnover
Turnover Q1 2024
£m Growth Growth
AER% CER%
Shingles 945 13 18
Meningitis 299 7 11
RSV (Arexvy) 182 - -
Influenza 13 8 8
Established Vaccines 838 3 7
Vaccines ex COVID 2,277 17 22
Pandemic vaccines - >(100) >(100)
Vaccines 2,277 12 16
HIV 1,613 10 14
Respiratory/Immunology and Other 635 6 11
Oncology 273 >100 >100
Specialty Medicines ex COVID 2,521 14 19
Xevudy 1 (97) (97)
Specialty Medicines 2,522 13 17
Respiratory 1,725 (2) 2
Other General Medicines 839 (7) (2)
General Medicines 2,564 (4) 1
Total 7,363 6 10
Total ex COVID 7,362 8 13
By Region:
US 3,589 10 14
Europe 1,621 (5) (3)
International 2,153 9 16
Total 7,363 6 10
Turnover ex COVID is excluding COVID-19 solutions during the years from 2020
to 2023 and is a non-IFRS measure defined on page 47 with the reconciliation
to the IFRS measure Turnover included in the table above. Financial
Performance - Q1 2024 results unless otherwise stated, growth % and commentary
at CER.
Q1 2024
£m AER CER
Vaccines Total 2,277 12% 16%
Excluding COVID 2,277 17% 22%
In Q1 2024, Vaccine sales increased by double-digits, reflecting US demand for
Arexvy and strong market growth for Shingrix in International and European
markets. However, the quarter's growth was adversely impacted by six
percentage points due to COVID-19 solution sales compared to Q1 2023.
Shingles 945 13% 18%
The sales of Shingrix, a vaccine against herpes zoster (shingles), increased
in the quarter due to strong demand following public funding expansion in
International and European markets, with new national immunisation programmes
in Australia and Europe, including the UK, together with earlier than
anticipated supply to Zhifei (Chongqing Zhifei Biological Products, Ltd),
GSK's co-promotion partner in China. Markets outside the US now represent more
than 50% of global sales (Q1 2023: 40%), with Shingrix launched in 39
countries. The majority of these markets have average cumulative immunisation
rates below 5%.
In Q1 2024, US sales decreased by 7% at AER and 4% at CER, reflecting the
comparison to Q1 2023, which benefitted from the removal of adult vaccine
cost-sharing covered under Medicare Part D and expanded coverage of adult
vaccines under Medicare following the implementation of the Inflation
Reduction Act. In addition, the performance reflected the prioritisation of
other adult vaccines for example, influenza and COVID-19 during the viral
respiratory season and the increasing challenge of activating harder to reach
consumers. The US cumulative immunisation penetration rate at the end of 2023
reached 37% of the more than 120 million US adults(1) currently recommended to
receive Shingrix, up seven percentage points since the end of 2022. The US
performance in Q1 2024 was partly offset by favourable pricing and prior
period channel inventory movements.
(1) United States Census Bureau, International Database, Year 2023.
Q1 2024
£m AER CER
Meningitis 299 7% 11%
In Q1 2024, meningitis vaccine sales increased following higher demand in
International markets for Menveo, a vaccine against meningitis ACWY. Sales for
Bexsero, a vaccine against meningitis B, were stable at AER and increased by
3% at CER in the quarter, primarily reflecting increased demand in Australian
regional immunisation programmes and the recent launch in Vietnam. However,
this performance was partly offset by tender phasing in Europe.
RSV (Arexvy) 182 - -
Arexvy, a respiratory syncytial virus (RSV) vaccine for older adults,
delivered Q1 2024 sales of £182 million, reflecting continued strong consumer
uptake and leading market share. In the US, Q1 2024 sales were £154 million,
with the overwhelming majority of doses administered in the retail setting.
Arexvy maintained around two-thirds of the vaccination share, while demand
decreased overall in line with anticipated seasonality patterns. More than
seven million of the 83 million US adults(1) aged 60 and older at risk have
been protected by Arexvy since the launch in Q3 2023. The performance in Q1
2024 also reflected initial tender deliveries in Saudi Arabia, continued
consumer uptake in Canada, and a new launch inventory build in Brazil.
Established Vaccines 838 3% 7%
In Q1 2024, Established Vaccines' growth was driven by an increased supply of
measles, mumps, rubella, and varicella vaccines in International, a higher
share of Rotarix in the US and increased demand in International.
Infanrix/Pediarix decreased due to competitive pressure in the US.
Specialty Medicines Total 2,522 13% 17%
Excluding COVID 2,521 14% 19%
Specialty Medicines sales increased by double digits in the quarter,
reflecting continued growth across disease areas, with strong performances in
HIV, Respiratory/Immunology and Oncology.
HIV 1,613 10% 14%
In Q1 2024 HIV delivered double digit growth, which was primarily driven by a
2 percentage point increase in market share versus Q1 2023 as a result of
strong patient demand for Oral 2DR (Dovato, Juluca) and long-acting medicines
(Cabenuva, Apretude), as well as favourability in the quarter on pricing and
tender phasing.
Oral 2DR 640 17% 21%
Oral 2-drug regimens sales in the quarter were £640 million, which now
represents 40% of the total HIV portfolio. Dovato continues to be the highest
selling product in the HIV portfolio with sales of £483 million in the
quarter and growing 27% versus Q1 2023.
Long-Acting Medicines 267 77% 83%
Long-Acting Medicine sales in the quarter were £267 million, growing £116
million at AER; £125 million at CER versus Q1 2023 and now represent 17% of
the total HIV portfolio compared to 10% for Q1 2023. Cabenuva sales in Q1 2024
were £213 million and growing 73% driven by strong patient demand. Apretude
sales in Q1 2024 were £54 million, growing £30 million at AER; £32 million
at CER compared to Q1 2023.
Respiratory/Immunology and Other 635 6% 11%
Sales primarily comprise contributions from Nucala in respiratory and Benlysta
in immunology. In Q1 2024, sales growth for Nucala and Benlysta increased,
mainly driven by demand in European and International markets. However, this
performance was reduced by the US, where the growth of the medicines remained
broadly stable. Volume demand growth was partly offset by the impact of
channel inventory reduction following a channel inventory build in Q4 2023.
Nucala 374 8% 13%
Nucala, is an IL-5 antagonist monoclonal antibody treatment for severe asthma,
with additional indications including chronic rhinosinusitis with nasal
polyps, eosinophilic granulomatosis with polyangiitis (EGPA), and
hypereosinophilic syndrome (HES). In Q1 2024, sales growth was driven by
strong performances in Europe and International regions, which reflected
higher patient demand for treatments addressing eosinophilic-led disease.
(1) United States Census Bureau, International Database, Year 2023.
Q1 2024
£m AER CER
Benlysta 260 3% 8%
Benlysta, a monoclonal antibody treatment for Lupus, continues to grow
consistently, representing strong demand and volume growth in European and
International markets. Bio penetration rates have increased in certain
International markets, particularly in Japan and China.
Oncology 273 >100% >100%
In Q1 2024, Oncology sales growth increased driven by strong patient growth
for Zejula, a PARP(1), Jemperli, a PD-1(2) blocking antibody, and
Ojjaara/Omjjara, a daily JAK1/JAK2 and ACVR1(3) inhibitor. Jemperli, a
medicine for front-line treatment in combination with chemotherapy for
patients with dMMR/MSI-H primary advanced or recurrent endometrial cancer,
continued to grow strongly and delivered sales of £80 million in the quarter.
Ojjaara/Omjjara, a treatment for myelofibrosis patients with anaemia, launched
in the US in Q3 2023 and in the UK and Germany in Q1 2024, has seen strong
uptake since launch and delivered £52 million of sales in the quarter.
Zejula 141 24% 27%
Zejula delivered double-digit sales growth in the quarter, with strong
performances across all regions following increased patient demand and higher
volumes. In addition, new launches, particularly in the International region,
also contributed to the performance.
General Medicines 2,564 (4%) 1%
Sales include contributions from both the Respiratory and Other General
Medicine portfolios. In Q1 2024, sales decreased 4% at AER but increased by 1%
at CER. This increase was driven primarily by strong demand across all regions
for Trelegy, a chronic obstructive pulmonary disease (COPD) and asthma
medicine. The performance also included increased growth for Anoro in Europe
and International, and a strong antibiotic performance in International
markets. However, this performance was primarily offset by a decrease across
the Established Respiratory and Other General Medicine portfolios following
the adverse impact of removing the Average Manufacturer Price (AMP) cap on
Medicaid drug prices in the US. This removal particularly impacted the
performance of Advair, Flovent, and Lamictal in the quarter due to significant
pricing reductions, reduced commercial contracting, and the decision to
discontinue branded Flovent. However, the increased use of authorised generic
versions of Advair and Flovent has partially offset the impact of AMP cap
removal while, significantly, continuing to provide access to patients.
Respiratory 1,725 (2%) 2%
In Q1 2024, the increase in sales growth reflected Trelegy's strong
performance in all regions and the increased demand for Anoro, particularly in
Europe and International. However, as mentioned above, this was partially
offset by the decrease across the Established Respiratory portfolio and the
removal of the AMP cap.
Trelegy 591 27% 33%
Trelegy is the most prescribed single inhaler triple therapy (SITT) treatment
worldwide for COPD and asthma. In Q1 2024 sales growth significantly increased
across all regions, reflecting strong patient demand, single-inhaled triple
therapy class growth, and increased market share.
Seretide/Advair 282 (17%) (13%)
Seretide/Advair is a combination treatment used to treat asthma and COPD. In
Q1 2024, the decrease in sales reflected continued generic erosion from
competitor products in Europe and International and the removal of the AMP cap
on Medicaid drug prices in the US.
Other General Medicines 839 (7%) (2%)
The performance in Q1 2024 was adversely impacted by ongoing generic
competition and the removal of the AMP cap on Medicaid drug prices in the US,
notably impacting Lamictal's performance. This performance was partially
offset by increased antibiotic growth in International markets.
Footnotes:
(1) PARP: a Poly ADP ribose polymerase
(2) PD-1: a programmed death receptor-1 blocking antibody
(3) JAK1/JAK2 and ACVR1: once a-day, oral JAK1/JAK2 and activin A receptor type 1
(ACVR1) inhibitor
By Region
Q1 2024
£m AER CER
US Total 3,589 10% 14%
Excluding COVID 3,589 10% 14%
Vaccine sales increased by double-digits in Q1 2024, driven by continued
strong consumer uptake and Arexvy's leading market share. The decrease in
Shingrix sales reflected the comparison to Q1 2023, the prioritisation of
other adult viral respiratory season vaccines, and the increasing challenge of
activating harder to reach consumers. Favourable pricing and a prior-period
channel inventory reduction partly offset this performance.
In Q1 2024, the sales of Specialty Medicines increased, driven by strong HIV
and Oncology performances. However, despite increased patient demand, the
performances of Nucala and Benlysta remained broadly stable in the quarter,
reflecting the impact of channel inventory reductions.
General Medicine's growth in Q1 2024 was driven by increased demand for
Trelegy and the growth of the SITT market. However, this performance was
offset by Established Respiratory and Other General Medicines following the
removal of the AMP cap on Medicaid drug prices, which particularly impacted
Advair, Flovent, and Lamictal.
Europe Total 1,621 (5%) (3%)
Excluding COVID 1,621 1% 3%
In Q1 2024, Vaccine sales growth excluding COVID-19 solutions was broadly
stable despite Shingrix growth across several markets following new national
immunisation programmes. Lower Bexsero tender deliveries partly offset this
performance.
Specialty Medicines sales increased by a double-digit percentage due to the
performance in HIV and Oncology. The performance of Benlysta in immunology and
Nucala in respiratory, including the impact of new indication launches, also
contributed to the sales increase.
General Medicines sales were broadly stable in the quarter, reflecting strong
growth in Trelegy and Anoro, offset by a decrease in Established Respiratory.
In Q1 2024, COVID-19 solutions adversely impacted growth by six percentage
points. Excluding this impact, European sales increased by 3% at CER.
International Total 2,153 9% 16%
Excluding COVID 2,152 11% 18%
In Q1 2024, sales excluding COVID-19 solutions increased 11% at AER and 18% at
CER, which reflected year-on-year exchange movements in several International
markets compared to Q1 2023.
Vaccines' double-digit growth was driven by the expansion of public funding
for Shingrix in Australia and Japan, together with earlier than anticipated
supply to Zhifei, GSK's co-promotion partner in China. Established vaccines
also contributed to growth due to increased demand and supply phasing.
Specialty Medicine's double-digit growth was driven by HIV, Nucala in
Respiratory, Benlysta in Immunology, and Zejula in Oncology.
General Medicines sales were broadly stable, with Trelegy and Antibiotics
delivering growth offset by a decrease in Other General Medicines and
Established Respiratory.
In Q1 2024, COVID-19 solutions adversely impacted growth by two percentage
points. Excluding this impact, International sales grew 18% in Q1 2024.
Financial performance
Total Results Q1 2024
£m % AER % CER
Turnover 7,363 6 10
Cost of sales (1,970) 1 2
Selling, general and administration (2,087) (3) -
Research and development (1,434) 14 17
Royalty income 151 (16) (16)
Other operating income/(expense) (533)
Operating profit 1,490 (28) (18)
Net finance expense (134) (23) (22)
Share of after tax profit/(loss) of associates and joint ventures (1)
Profit before taxation 1,355 (29) (18)
Taxation (274)
Tax rate % 20.2%
Profit after taxation 1,081 (34) (23)
Profit attributable to non-controlling interests 35
Profit attributable to shareholders 1,046
1,081 (34) (23)
Earnings per share 25.7p (30) (19)
Financial Performance - Q1 2024 results unless otherwise stated, growth % and
commentary at CER.
Core results
Reconciliations between Total results and Core results for Q1 2024 and Q1
2023, are set out on pages 20 and 21.
Q1 2024
£m % AER % CER
Turnover 7,363 6 10
Cost of sales (1,733) (1) -
Selling, general and administration (1,979) (4) (2)
Research and development (1,359) 11 14
Royalty income 151 (16) (16)
Core operating profit 2,443 17 27
Core profit before taxation 2,310 20 32
Taxation (404) 33 46
Core profit after taxation 1,906 18 29
Core profit attributable to non-controlling interests 154
Core profit attributable to shareholders 1,752
1,906 18 29
Earnings per share 43.1p 16 28
Q1 2024
£m AER CER
Cost of sales Total 1,970 1% 2%
% of sales 26.8% (1.2%) (2.1%)
Core 1,733 (1%) -
% of sales 23.5% (1.7%) (2.5%)
Total and Core cost of sales as a percentage of sales decreased in Q1 2024
primarily driven by mix benefits from the growth in higher margin Arexvy,
Shingrix and Specialty products as well as regional margin mix from higher US
sales.
Q1 2024
£m AER CER
Selling, general & administration Total 2,087 (3%) -
% of sales 28.3% (2.5%) (3.0%)
Core 1,979 (4%) (2%)
% of sales 26.9% (2.8%) (3.3%)
Disciplined SG&A investment to support global market expansion and disease
awareness for Arexvy and Shingrix was more than offset by a 6 percentage point
favourable impact of the reversal of the legal provision taken in Q1 2023 for
the Zejula royalty dispute, following a successful appeal. Total SG&A also
included an increase in significant legal costs reflecting increased legal
fees (see details on page 22).
Q1 2024
£m AER CER
Research & Total 1,434 14% 17%
development
% of sales 19.5% 1.3% 1.0%
Core 1,359 11% 14%
% of sales 18.5% 0.9% 0.6%
In Q1 2024, R&D expense increased due to continued investment across
disease areas, including bepirovirsen (chronic hepatitis B) and the
advancement of clinical trial programmes associated with the pneumococcal
Multi Antigen Presenting System (MAPS) and mRNA in Infectious Diseases.
In HIV, early-stage research expenses increased following investment in
next-generation long-acting treatment and preventative medicines. In
Respiratory and Oncology, investment increased to support lifecycle innovation
and late-stage clinical development programmes for depemokimab (asthma and
eosinophilic inflammation), camlipixant (refractory chronic cough), and
Jemperli (endometrial cancer). Lower R&D expenses predominately related to
Arexvy in Infectious Disease and Zejula and Ojjaara in Oncology partly offset
this.
Q1 2024
£m AER CER
Royalty income Total 151 (16%) (16%)
Core 151 (16%) (16%)
The decrease in Total and Core royalty income in Q1 2024 is primarily related
to the cessation of the majority of Gardasil royalties at the end of 2023,
with Q1 2024 Gardasil royalties of £22 million (Q1 2023: £71 million). This
was partly offset by increases in Kesimpta and Biktarvy royalties.
Q1 2024
£m AER CER
Other operating Total (533) >(100%) >(100%)
income/(expense)
In Q1 2024 other operating expense reflected a charge of £685 million (Q1
2023: £271 million credit) arising from the remeasurement of contingent
consideration liabilities primarily reflecting improved longer term HIV
prospects and foreign currency movements and the liabilities for the Pfizer,
Inc. (Pfizer) put option. This was partly offset by a fair value gain of £57
million (Q1 2023: £65 million loss) on the retained stake in Haleon plc
(Haleon) and other net income of £95 million (Q1 2023: £91 million).
Q1 2024
£m AER CER
Operating profit Total 1,490 (28%) (18%)
% of sales 20.2% (9.7%) (7.8%)
Core 2,443 17% 27%
% of sales 33.2% 3.1% 4.6%
Total operating profit margin was lower in Q1 2024 primarily due to
unfavourable movements in contingent consideration liabilities reflecting
improved longer term HIV prospects and foreign currency movement, partly
offset by a fair value gain on the retained stake in Haleon (Q1 2023 fair
value loss).
Core operating profit in the quarter benefitted from strong sales, favourable
product mix and the reversal of the legal provision taken in Q1 2023 for the
Zejula royalty dispute, following a successful appeal. This was partly offset
by increased investment in R&D and growth assets, and lower royalty
income. The adverse impact of lower sales of COVID-19 solutions was eight
percentage points of Core operating profit growth, with minimal impact on Core
operating profit margin.
Q1 2024
£m AER CER
Net finance costs Total 134 (23%) (22%)
Core 132 (22%) (22%)
The decrease in net finance costs in Q1 2024 was mainly driven by the net cost
of certain bond buybacks completed in Q1 2023 and higher interest income on
cash.
Q1 2024
£m AER CER
Taxation Total 274 (1%) 13%
Tax rate % 20.2%
Core 404 33% 46%
Tax rate % 17.5%
The effective tax rate on Core profits is broadly in line with expectations
for the year and includes the impact of the OECD's BEPS Pillar Two model
framework which came into effect from 1 January 2024. Issues related to
taxation are described in Note 14, 'Taxation' in the Annual Report 2023. The
Group continues to believe it has made adequate provision for the liabilities
likely to arise from periods that are open and not yet agreed by relevant tax
authorities. The ultimate liability for such matters may vary from the amounts
provided and is dependent upon the outcome of agreements with relevant tax
authorities.
Q1 2024
£m AER CER
Non-controlling Total 35 (75%) (66%)
interests ("NCIs")
Core 154 27% 38%
The decrease in Total profit allocated to NCIs in the quarter was primarily
driven by lower ViiV Healthcare profits (including the remeasurement loss on
the contingent consideration liability) with an allocation of £28 million (Q1
2023: £140 million), partly offset by higher net profits in some of the
Group's other entities.
The increase in Core profit from operations allocated to NCIs in Q1 2024
primarily reflected higher profit allocations from ViiV Healthcare of £147
million (Q1 2023: £120 million), as well as higher net profits in some of the
Group's other entities with NCIs.
Q1 2024
£p AER CER
Earnings per share Total 25.7p (30%) (19%)
Core 43.1p 16% 28%
The increase in the Core EPS in the quarter reflected the growth in Core
operating profit as well as lower finance costs, partly offset by higher
non-controlling interests and a higher effective taxation rate. Lower sales of
COVID-19 solutions reduced Core EPS by nine percentage points.
The decrease in the Q1 2024 Total EPS primarily reflected higher charges
related to the remeasurement of contingent consideration liabilities
reflecting improved longer term HIV prospects and foreign currency movement
partly offset by a fair value gain on the retained stake in Haleon (compared
to a fair value loss in Q1 2023) and a favourable benefit from lower
non-controlling interests.
Currency impact on results
The results for Q1 2024 are based on average exchange rates, principally
£1/$1.27, £1/€1.16 and £1/Yen 187. The period-end exchange rates were
£1/$1.26, £1/€1.17 and £1/Yen 191. Comparative exchange rates are given
on page 34.
Q1 2024
£m/£p AER CER
Turnover 7,363 6% 10%
Earnings per share Total 25.7p (30%) (19%)
Core 43.1p 16% 28%
In Q1 2024, the adverse currency impact primarily reflected the strengthening
of Sterling against the US Dollar, Euro and Yen, as well as the weakening of
emerging market currencies against Sterling. Exchange gains or losses on the
settlement of intercompany transactions had an adverse two percentage point
impact on Core EPS.
Cash generation
Cash flow
Q1 2024 Q1 2023
£m £m
Cash generated from operations (£m) 1,126 287
Net cash generated from operating activities (£m) 958 53
Free cash inflow/(outflow)* (£m) 289 (689)
Free cash flow growth (%) >100% >(100)%
Free cash flow conversion* (%) 28% 3%
Total net debt** (£m) 14,961 17,950
* Free cash flow and free cash flow conversion are defined on page 47. Free
cash flow is analysed on page 37.
** Net debt is analysed on page 37.
Q1 2024
Cash generated from operations for the quarter was £1,126 million (Q1 2023:
£287 million). The increase primarily reflected higher operating profit and
higher receivables' collections, driven by the timing of sales and collections
particularly for Arexvy, partly offset by timing of returns and rebates.
Total contingent consideration cash payments in the quarter were £309 million
(Q1 2023: £291 million), including cash payments made to Shionogi & Co.
Ltd (Shionogi) of £300 million (Q1 2023: £287 million). £306 million (Q1
2023: £290 million) of these were recognised in cash flows from operating
activities.
Free cash inflow was £289 million for the quarter (Q1 2023: £689 million
outflow). In addition to the increase in cash generated from operations the
increase in free cash flow in the quarter was primarily driven by lower tax
payments, lower net interest paid and lower dividends paid to non-controlling
interests. This was partly offset by increased capital expenditure.
Total Net debt
At 31 March 2024, net debt was £14,961 million, compared with £15,040
million at 31 December 2023, comprising gross debt of £17,772 million and
cash and liquid investments of £2,811 million. See net debt information on
page 36.
Net debt decreased by £79 million primarily due to £289 million free cash
inflow and £1,055 million proceeds from the disposal of investments,
including the partial sale of the retained stake in Haleon. This was partly
offset by the net acquisition cost of Aiolos Bio, Inc. (Aiolos) for £719
million and dividends paid to shareholders of £568 million.
At 31 March 2024, GSK had short-term borrowings (including overdrafts and
lease liabilities) repayable within 12 months of £2,616 million with loans of
£1,431 million repayable in the subsequent year.
Contents Page
Q1 2024 pipeline highlights 14
ESG 16
Total and Core results 18
Income statement 23
Statement of comprehensive income 24
Balance sheet 25
Statement of changes in equity 26
Cash flow statement - three months ended 31 March 2024 27
Sales tables - three months ended 31 March 2024 28
Segment information 31
Legal matters 32
Returns to shareholders 33
Additional information 34
Net debt information 36
Related party transactions 37
R&D commentary 38
Reporting definitions 47
Guidance, assumptions and cautionary statements 49
Independent Auditor's review report to GSK plc 50
Contacts
GSK plc (LSE/NYSE:GSK) is a global biopharma company with a purpose to unite
science, technology, and talent to get ahead of disease together. Find out
more at www.gsk.com (http://www.gsk.com/) .
GSK enquiries:
Media Tim Foley +44 (0) 20 8047 5502 (London)
Kathleen Quinn +1 202 603 5003 (Washington)
Investor Relations Nick Stone +44 (0) 7717 618834 (London)
James Dodwell +44 (0) 7881 269066 (London)
Mick Readey +44 (0) 7990 339653 (London)
Joshua Williams +44 (0) 7385 415719 (London)
Jeff McLaughlin +1 215 589 3774 (Philadelphia)
Registered in England & Wales:
No. 3888792
Registered Office:
980 Great West Road
Brentford, Middlesex
TW8 9GS
Q1 2024 pipeline highlights (since 31 January 2024)
Medicine/vaccine Trial (indication, presentation) Event
Regulatory submissions or acceptances Arexvy RSV, adults aged 50-59 years Regulatory acceptance (US)
MenABCWY (gen 1) vaccine candidate Meningococcal ABCWY Regulatory acceptance (US)
Shingrix Shingles, adults aged 18+ years Regulatory acceptance (CN)
Jemperli RUBY part 1 (OS overall population, 1L endometrial cancer) Regulatory acceptance (US)
Phase III data readouts or other significant events gepotidacin EAGLE-1 (urogenital gonorrhoea) Positive phase III data readout
Blenrep DREAMM-8 (2L + multiple myeloma) Positive phase III data readout
cabotegravir LATITUDE (HIV long-acting injectable) Positive phase III data readout
Jemperli RUBY Part 1 (OS) and Part 2 (PFS) (1L endometrial cancer) Additional positive phase III data readout
Anticipated news flow
Timing Medicine/vaccine Trial (indication, presentation) Event
H1 2024 Arexvy RSV, older adults aged 50-59 years Regulatory decision (US)
momelotinib MOMENTUM (myelofibrosis with anaemia) Regulatory decision (JP)
depemokimab SWIFT-1/2 (severe asthma) Phase III data readout
H2 2024 Arexvy RSV, older adults aged 50-59 years Regulatory decision (EU, JP)
gepotidacin EAGLE-2/3 (uncomplicated urinary tract infection) Regulatory submission (US)
MenABCWY (gen 1) Meningococcal ABCWY Regulatory submission (EU)
vaccine candidate
depemokimab ANCHOR-1/2 (chronic rhinosinusitis with nasal polyps) Phase III data readout
depemokimab ANCHOR-1/2 (chronic rhinosinusitis with nasal polyps) Regulatory submission (US)
depemokimab SWIFT-1/2 (severe asthma) Regulatory submission (US)
Nucala Chronic rhinosinusitis with nasal polyps Regulatory decision (JP)
Nucala MATINEE (chronic obstructive pulmonary disease) Phase III data readout
Nucala MATINEE (chronic obstructive pulmonary disease) Regulatory submission (US)
Blenrep DREAM-7/8 (2L + multiple myeloma) Regulatory submission
(US, EU, JP)
Blenrep DREAMM-7 (2L + multiple myeloma) Regulatory submission (CN)
Jemperli RUBY part 1 (OS overall population, 1L endometrial cancer) Regulatory decision (US)
Jemperli RUBY part 1 (OS overall population, 1L endometrial cancer) Regulatory submission (EU)
Zejula FIRST (1L maintenance ovarian cancer) Phase III data readout
Zejula ZEAL (1L maintenance non-small cell lung cancer) Phase III data readout
linerixibat GLISTEN (cholestatic pruritus in primary biliary cholangitis) Phase III data readout
Anticipated news flow continued
Timing Medicine/vaccine Trial (indication, presentation) Event
2025 gepotidacin EAGLE-2/3 (uncomplicated urinary tract infection) Regulatory decision (US)
gepotidacin EAGLE-1 (urogenital gonorrhoea) Regulatory submission (US)
gepotidacin EAGLE-1 (urogenital gonorrhoea) Regulatory decision (US)
geopotidacin EAGLE-J (uncomplicated urinary tract infection) Regulatory submission (JP)
MenABCWY (gen 1) vaccine candidate Meningococcal ABCWY Regulatory decision (US)
Shingrix Shingles, adults aged 18+ years Regulatory decision (CN)
tebipenem pivoxil PIVOT-PO (complicated urinary tract infection) Phase III data readout
tebipenem pivoxil PIVOT-PO (complicated urinary tract infection) Regulatory submission (US)
camlipixant CALM-1/2 (refractory chronic cough) Phase III data readout
camlipixant CALM-1/2 (refractory chronic cough) Regulatory submission
(US, EU)
depemokimab SWIFT-1/2 (severe asthma) Regulatory decision (US, JP)
depemokimab SWIFT-1/2 (severe asthma) Regulatory submission
(EU, CN, JP)
depemokimab ANCHOR-1/2 (chronic rhinosinusitis with nasal polyps) Regulatory decision (US, JP)
depemokimab ANCHOR-1/2 (chronic rhinosinusitis with nasal polyps) Regulatory submission
(EU, CN, JP)
depemokimab OCEAN (eosinophilic granulomatosis with polyangiitis) Phase III data readout
Nucala Chronic rhinosinusitis with nasal polyps Regulatory decision (CN)
Nucala MATINEE (chronic obstructive pulmonary disease) Regulatory decision (US)
Nucala MATINEE (chronic obstructive pulmonary disease) Regulatory submission
(CN, EU)
Blenrep DREAMM-7/8 (2L+ multiple myeloma) Regulatory decision
(US, EU, JP)
Blenrep DREAMM-8 (2L+ multiple myeloma) Regulatory submission (CN)
cobolimab COSTAR (non-small cell lung cancer) Phase III data readout
cobolimab COSTAR, (2L non-small cell lung cancer) Regulatory submission
(US, EU)
Jemperli RUBY part 1 (OS overall population, 1L endometrial cancer) Regulatory decision (EU)
linerixibat GLISTEN (cholestatic pruritus in primary biliary cholangitis) Regulatory submission
(US, EU, CN, JP)
linerixibat GLISTEN (cholestatic pruritus in primary biliary cholangitis) Regulatory decision (US)
Refer to pages 38 to 46 for further details on several key medicines and
vaccines in development by therapy area.
Trust: progress on our six priority areas for responsible business
Building Trust by operating responsibly is integral to GSK's strategy and
culture. This will support growth and returns to shareholders, reduce risk,
and help GSK's people thrive while delivering sustainable health impact at
scale. The company has identified six Environmental, Social, and Governance
(ESG) focus areas that address what is most material to GSK's business and the
issues that matter the most to its stakeholders. Highlights below include
activity since Q4 2023 results. For more details on annual updates, please see
GSK's ESG (https://www.gsk.com/media/11009/esg-performance-report-2023.pdf)
Performance (https://www.gsk.com/media/11009/esg-performance-report-2023.pdf)
Report 2023 (https://www.gsk.com/media/11009/esg-performance-report-2023.pdf)
. (1)
Access
Commitment: to make GSK's vaccines and medicines available at value-based
prices that are sustainable for the business and implement access strategies
that increase the use of GSK's vaccines and medicines to treat and protect
underserved people.
Progress since Q4 2023:
• GSK announced a cap of $35 per month on eligible U.S. patient out-of-pocket
costs for its entire portfolio of asthma and COPD inhalers. This announcement
builds on GSK's decades-long commitment to making products accessible to those
who need them. More information can be found here
(https://us.gsk.com/en-us/media/press-releases/gsk-announces-cap-of-35-per-month-on-us-patient-out-of-pocket-costs-for-its-entire-portfolio-of-asthma-and-copd-inhalers/)
. (2)
• GSK announced additional funding and new data and resources under the
COiMMUNITY Initiative to help achieve higher adult vaccination rates and
health equity in the US and address ongoing barriers to adult immunisation. In
2024, GSK is giving up to $2 million in COiMMUNITY Initiative grants. More
information can be found here
(https://us.gsk.com/en-us/media/press-releases/gsk-doubles-coimmunity-grant-funding-launches-patient-resources-as-adult-vaccination-rates-begin-to-show-promising-rise/)
. (3)
• Performance metrics related to access are updated annually with related
details in GSK's ESG Performance Report 2023 on page 10.
Global health and health security
Commitment: develop novel products and technologies to treat and prevent
priority diseases, including pandemic threats.
Progress since Q4 2023:
• GSK announced positive headline results from EAGLE-1 phase III trial for
gepotidacin in uncomplicated urogenital gonorrhoea. Neisseria gonorrhoeae, the
bacteria causing gonorrhoea, is recognised by the World Health Organisation as
a priority pathogen, for which resistance to existing treatments is rising.
More information can be found here
(https://www.gsk.com/en-gb/media/press-releases/gsk-announces-positive-headline-results-from-eagle-1-phase-iii-trial-for-gepotidacin-in-uncomplicated-urogenital-gonorrhoea-gc/)
. (4)
• In March, the GSK-developed tuberculosis (TB) vaccine candidate M72/AS01E
entered phase III trials, sponsored by Wellcome and the Bill & Melinda
Gates Medical Research Institute. This is the first potential new TB vaccine
which meets the WHO target product profile in over 100 years. More information
on GSK's TB and Global health efforts can be found here
(https://www.gsk.com/en-gb/responsibility/global-health-and-health-security/using-our-science-for-global-health/)
. (5)
• Performance metrics related to global health and health security are updated
annually with related details in GSK's ESG Performance Report 2023 on page 15.
Environment
Commitment: committed to a net zero, nature-positive, healthier planet with
ambitious goals set for 2030 and 2045.
Progress since Q4 2023:
• In February, the global environmental non-profit CDP published its annual
scoring of corporate environmental performance. CDP sets high and constantly
evolving standards for environmental leadership to support companies to
improve their level of ambition and action on climate and nature. This year's
results, which are based on 2022 performance, reflect a year-over-year
improvement for GSK for Water Security score (A- from B) and a continued high
A- score for Climate Change. GSK also scored well in two Forest commodities
receiving a B for paper and B for palm oil.
• In February, GSK announced a virtual power purchase agreement to source
renewable electricity through two new solar projects in Spain to facilitate
50% of its European sites' electricity demand for 12 years, from mid-2026.
• Whilst GSK is focused on emissions reductions to meet its carbon targets, at
the same time, it is investing in high quality nature protection and
restoration projects that support GSK's net-zero and nature positive goals,
and deliver co-benefits to human health. In March, GSK disclosed it has
invested in Climate Asset Management's Nature Based Carbon Fund, which aims to
invest in nature projects in developing economies, to provide long-lasting,
verified, positive impact at scale for the climate, biodiversity and local
communities. This is a long-term investment over the next 15 years, which aims
to secure approximately a quarter of credits needed in 2030, to meet GSK's
commitment to invest in nature-based solutions for 20% of its 2020 footprint.
• Performance metrics related to environment are updated annually with related
details in GSK's ESG Performance Report 2023 on page 18.
Diversity, equity and inclusion
Commitment: create a diverse, equitable and inclusive workplace; enhance
recruitment of diverse patient populations in GSK clinical trials; and support
diverse communities.
Progress since Q4 2023:
• Performance metrics related to diversity, equity and inclusion are updated
annually with related details in GSK's ESG Performance Report 2023 on page 26.
Ethical standards
Commitment: promote ethical behaviour across GSK's business by supporting its
employees to do the right thing and working with suppliers that share GSK's
standards and operate responsibly.
• Performance metrics related to ethical standards are updated annually with
related details in GSK's ESG Performance Report 2023 on page 30.
Product governance
Commitment: maintain robust quality and safety processes and responsibly use
data and new technologies.
• Performance metrics related to product governance are updated annually with
related details in GSK's ESG Performance Report 2023 on page 35.
ESG rating performance
Detailed below is how GSK performs in key ESG ratings.
Current Previous
External benchmark score/ranking score/ranking Comments
S&P Global's Corporate Sustainability Assessment 84 86 1st in the pharmaceutical industry group; Assessment conducted annually,
current score updated Nov 2023
Access to Medicines Index 4.06 4.23 Led the bi-annual index since its inception in 2008; Updated bi-annually,
current results from Nov 2022
Antimicrobial resistance benchmark 84% 86% Led the bi-annual benchmark since its inception in 2018; Current ranking
updated Nov 2021
CDP Climate Change A- A- Updated annually, current scores updated Feb 2024 (for supplier engagement,
March 2023)
CDP Water Security A- B
CDP Forests (palm oil) B A-
CDP Forests (timber) B B
CDP supplier engagement rating Leader Leader
Sustainalytics 16.7 18.6 1st percentile in pharma subindustry group; Lower score represents lower risk.
Current ranking updated Sept 2023
MSCI AA AA Last rating action date: Sept 2023
Moody's ESG solutions 62 61 Current score updated Aug 2023
ISS Corporate Rating B+ B+ Current score updated June 2023
FTSE4Good Member Member Member since 2004, latest review in June 2023
ShareAction's Workforce Disclosure Initiative 79% 77% Current score updated Jan 2024
Footnotes:
(1) https://www.gsk.com/media/11009/esg-performance-report-2023.pdf
(https://www.gsk.com/media/11009/esg-performance-report-2023.pdf)
(2) https://us.gsk.com/en-us/media/press-releases/gsk-announces-cap-of-35-per-month-on-us-patient-out-of-pocket-costs-for-its-entire-portfolio-of-asthma-and-copd-inhalers/
(https://us.gsk.com/en-us/media/press-releases/gsk-announces-cap-of-35-per-month-on-us-patient-out-of-pocket-costs-for-its-entire-portfolio-of-asthma-and-copd-inhalers/)
(3) https://us.gsk.com/en-us/media/press-releases/gsk-doubles-coimmunity-grant-funding-launches-patient-resources-as-adult-vaccination-rates-begin-to-show-promising-rise/
(https://us.gsk.com/en-us/media/press-releases/gsk-doubles-coimmunity-grant-funding-launches-patient-resources-as-adult-vaccination-rates-begin-to-show-promising-rise/)
(4) https://www.gsk.com/en-gb/media/press-releases/gsk-announces-positive-headline-results-from-eagle-1-phase-iii-trial-for-gepotidacin-in-uncomplicated-urogenital-gonorrhoea-gc/
(https://www.gsk.com/en-gb/media/press-releases/gsk-announces-positive-headline-results-from-eagle-1-phase-iii-trial-for-gepotidacin-in-uncomplicated-urogenital-gonorrhoea-gc/)
(5) https://www.gsk.com/en-gb/responsibility/global-health-and-health-security/using-our-science-for-global-health/
(https://www.gsk.com/en-gb/responsibility/global-health-and-health-security/using-our-science-for-global-health/)
Total and Core results
Total reported results represent the Group's overall performance.
GSK has made one update to its reporting framework in Q1 2024 which is to
change the description of Adjusted results to Core results to align with
European peers in the pharmaceutical industry but with no change to the basis
or figures. There is no change to Total Results or the definition of Adjusting
items.
GSK uses a number of non-IFRS measures to report the performance of its
business. Core results and other non-IFRS measures may be considered in
addition to, but not as a substitute for, or superior to, information
presented in accordance with IFRS. Core results are defined below and other
non-IFRS measures are defined on page 47.
GSK believes that Core results, when considered together with Total results,
provide investors, analysts and other stakeholders with helpful complementary
information to understand better the financial performance and position of the
Group from period to period, and allow the Group's performance to be more
easily compared against the majority of its peer companies. These measures are
also used by management for planning and reporting purposes. They may not be
directly comparable with similarly described measures used by other companies.
GSK encourages investors and analysts not to rely on any single financial
measure but to review GSK's quarterly results announcements, including the
financial statements and notes, in their entirety.
GSK is committed to continuously improving its financial reporting, in line
with evolving regulatory requirements and best practice. In line with this
practice, GSK expects to continue to review and refine its reporting
framework.
Core results exclude the following items in relation to our operations from
Total results, together with the tax effects of all of these items:
• amortisation of intangible assets (excluding computer software and capitalised
development costs)
• impairment of intangible assets (excluding computer software) and goodwill
• major restructuring costs, which include impairments of tangible assets and
computer software, (under specific Board approved programmes that are
structural, of a significant scale and where the costs of individual or
related projects exceed £25 million), including integration costs following
material acquisitions
• transaction-related accounting or other adjustments related to significant
acquisitions
• proceeds and costs of disposal of associates, products and businesses;
significant settlement income; significant legal charges (net of insurance
recoveries) and expenses on the settlement of litigation and government
investigations; other operating income other than royalty income, and other
items
Costs for all other ordinary course smaller scale restructuring and legal
charges and expenses from operations are retained within both Total and Core
results.
As Core results include the benefits of Major restructuring programmes but
exclude significant costs (such as significant legal, major restructuring and
transaction items) they should not be regarded as a complete picture of the
Group's financial performance, which is presented in Total results. The
exclusion of other Adjusting items may result in Core earnings being
materially higher or lower than Total earnings. In particular, when
significant impairments, restructuring charges and legal costs are excluded,
Core earnings will be higher than Total earnings.
GSK has undertaken a number of Major restructuring programmes in response to
significant changes in the Group's trading environment or overall strategy or
following material acquisitions. Within the Pharmaceuticals sector, the highly
regulated manufacturing operations and supply chains and long lifecycle of the
business mean that restructuring programmes, particularly those that involve
the rationalisation or closure of manufacturing or R&D sites are likely to
take several years to complete. Costs, both cash and non-cash, of these
programmes are provided for as individual elements are approved and meet the
accounting recognition criteria. As a result, charges may be incurred over a
number of years following the initiation of a Major restructuring programme.
Significant legal charges and expenses are those arising from the settlement
of litigation or government investigations that are not in the normal course
and materially larger than more regularly occurring individual matters. They
also include certain major legacy matters.
Reconciliations between Total and Core results, providing further information
on the key Adjusting items, are set out on pages 20 and 21.
GSK provides earnings guidance to the investor community on the basis of Core
results. This is in line with peer companies and expectations of the investor
community, supporting easier comparison of the Group's performance with its
peers. GSK is not able to give guidance for Total results as it cannot
reliably forecast certain material elements of the Total results, particularly
the future fair value movements on contingent consideration and put options
that can and have given rise to significant adjustments driven by external
factors such as currency and other movements in capital markets.
ViiV Healthcare
ViiV Healthcare is a subsidiary of the Group and 100% of its operating results
(turnover, operating profit, profit after tax) are included within the Group
income statement.
Earnings are allocated to the three shareholders of ViiV Healthcare on the
basis of their respective equity shareholdings (GSK 78.3%, Pfizer 11.7% and
Shionogi 10%) and their entitlement to preferential dividends, which are
determined by the performance of certain products that each shareholder
contributed. As the relative performance of these products changes over time,
the proportion of the overall earnings allocated to each shareholder also
changes. In particular, the increasing proportion of sales of dolutegravir and
cabotegravir-containing products has a favourable impact on the proportion of
the preferential dividends that is allocated to GSK. Adjusting items are
allocated to shareholders based on their equity interests. GSK was entitled to
approximately 84% of the Total earnings and 83% of the Core earnings of ViiV
Healthcare for 2023.
As consideration for the acquisition of Shionogi's interest in the former
Shionogi-ViiV Healthcare joint venture in 2012, Shionogi received the 10%
equity stake in ViiV Healthcare and ViiV Healthcare also agreed to pay
additional future cash consideration to Shionogi, contingent on the future
sales performance of the products being developed by that joint venture,
dolutegravir and cabotegravir. Under IFRS 3 'Business combinations', GSK was
required to provide for the estimated fair value of this contingent
consideration at the time of acquisition and is required to update the
liability to the latest estimate of fair value at each subsequent period end.
The liability for the contingent consideration recognised in the balance sheet
at the date of acquisition was £659 million. Subsequent remeasurements are
reflected within other operating income/(expense) and within Adjusting items
in the income statement in each period.
Cash payments to settle the contingent consideration are made to Shionogi by
ViiV Healthcare each quarter, based on the actual sales performance and other
income of the relevant products in the previous quarter. These payments reduce
the balance sheet liability and hence are not recorded in the income
statement. The cash payments made to Shionogi by ViiV Healthcare in the three
months ended 31 March 2024 were £300 million.
As the liability is required to be recorded at the fair value of estimated
future payments, there is a significant timing difference between the charges
that are recorded in the Total income statement to reflect movements in the
fair value of the liability and the actual cash payments made to settle the
liability.
Further explanation of the acquisition-related arrangements with ViiV
Healthcare are set out on pages 84 and 85 of the Annual Report 2023.
Adjusting items
The reconciliations between Total results and Core results for Q1 2024 and Q1
2023 are set out below.
Three months ended 31 March 2024
Total Intangible Intangible Major Trans- Divest- Core
results amort- impair- restruct- action- ments, results
£m isation ment uring related significant £m
£m £m £m £m legal and
other
items
£m
Turnover 7,363 7,363
Cost of sales (1,970) 182 33 19 3 (1,733)
Gross profit 5,393 182 33 19 3 5,630
Selling, general and administration (2,087) 17 91 (1,979)
Research and development (1,434) 14 54 7 (1,359)
Royalty income 151 151
Other operating income/(expense) (533) 685 (152) -
Operating profit 1,490 196 54 57 704 (58) 2,443
Net finance cost (134) 2 (132)
Share of after tax profit/(loss) of associates (1) (1)
and joint ventures
Profit before taxation 1,355 196 54 57 704 (56) 2,310
Taxation (274) (41) (14) (13) (76) 14 (404)
Tax rate % 20.2% 17.5%
Profit after taxation 1,081 155 40 44 628 (42) 1,906
Profit attributable to non-controlling 35 119 154
interests
Profit attributable to shareholders 1,046 155 40 44 509 (42) 1,752
1,081 155 40 44 628 (42) 1,906
Earnings per share 25.7p 3.8p 1.0p 1.1p 12.5p (1.0p) 43.1p
Weighted average number of shares (millions) 4,069 4,069
Three months ended 31 March 2023
Total Intangible Intangible Major Trans- Divest- Core
results amort- impair- restruct- action- ments, results
£m isation ment uring related significant £m
£m £m £m £m legal and
other
items
£m
Turnover 6,951 6,951
Cost of sales (1,943) 151 35 5 (1,752)
Gross profit 5,008 151 35 5 5,199
Selling, general and administration (2,143) 69 9 (2,065)
Research and development (1,260) 18 16 4 (1,222)
Royalty income 180 180
Other operating income/(expense) 297 (271) (26) -
Operating profit 2,082 169 16 108 (271) (12) 2,092
Net finance cost (174) 4 (170)
Share of after tax profit/(loss) of associates (2) (2)
and joint ventures
Profit/(loss) on disposal of interest in 1 (1) -
associates
Profit before taxation 1,907 169 16 108 (271) (9) 1,920
Taxation (276) (36) (4) (22) 15 20 (303)
Tax rate % 14.5% 15.8%
Profit after taxation 1,631 133 12 86 (256) 11 1,617
Profit attributable to non-controlling 141 (20) 121
interests
Profit attributable to shareholders 1,490 133 12 86 (236) 11 1,496
1,631 133 12 86 (256) 11 1,617
Earnings per share 36.8p 3.3p 0.3p 2.1p (5.8p) 0.3p 37.0p
Weighted average number of shares (millions) 4,044 4,044
Major restructuring and integration
Total Major restructuring charges incurred in Q1 2024 were £57 million (Q1
2023: £108 million), analysed as follows:
Q1 2024 Q1 2023
Cash Non- Total Cash Non- Total
£m cash £m £m cash £m
£m £m
Separation Preparation restructuring 28 8 36 37 47 84
programme
Significant acquisitions 19 - 19 21 1 22
Legacy programmes 2 - 2 - 2 2
49 8 57 58 50 108
The Separation Preparation programme incurred cash charges of £28 million
primarily from restructuring in Global Supply Chain as well as some commercial
and administrative functions. The non-cash charges of £8 million primarily
reflected the write down of assets in manufacturing locations.
Costs of significant acquisitions relate to integration costs of Sierra
Oncology Inc. (Sierra) and Affinivax Inc. (Affinivax) which were acquired in
Q3 2022, BELLUS Health Inc. (Bellus) acquired in Q2 2023 and Aiolos acquired
in Q1 2024.
Transaction-related adjustments
Transaction-related adjustments resulted in a net charge of £704 million (Q1
2023: £271 million credit), the majority of which related to charges/credits
for the remeasurement of contingent consideration liabilities, the liabilities
for the Pfizer put option, and Pfizer and Shionogi preferential dividends in
ViiV Healthcare.
Charge/(credit) Q1 2024 Q1 2023
£m £m
Contingent consideration on former Shionogi-ViiV Healthcare joint Venture 586 (64)
(including Shionogi preferential dividends)
ViiV Healthcare put options and Pfizer preferential dividends 66 (105)
Contingent consideration on former Novartis Vaccines business 28 (69)
Contingent consideration on acquisition of Affinivax 5 (33)
Other adjustments 19 -
Total transaction-related charges 704 (271)
The £586 million charge relating to the contingent consideration for the
former Shionogi-ViiV Healthcare joint venture represented an increase in the
valuation of the contingent consideration due to Shionogi by £479 million
from updated sales forecasts and exchange rates, and the unwind of the
discount for £107 million. The £66 million charge relating to the ViiV
Healthcare put option and Pfizer preferential dividends represented an
increase in the valuation of the put option primarily as a result of updated
sales forecasts.
The ViiV Healthcare contingent consideration liability is fair valued under
IFRS. An explanation of the accounting for the non-controlling interests in
ViiV Healthcare is set out on page 19.
The £28 million charge relating to the contingent consideration on the former
Novartis Vaccines business primarily relates to changes to future sales
forecasts.
The £5 million charge relating to the contingent consideration on the
acquisition of Affinivax primarily relates to the unwind of the discount.
Divestments, significant legal charges, and other items
Divestments, significant legal charges, and other items primarily included
fair value gains on investments, including a £57 million fair value gain on
the investment in Haleon and other net income of £95 million. Legal charges
provide for all significant legal matters and are not broken out separately by
litigation or investigation. Significant legal charges in the quarter
primarily reflected prospective legal costs for the defence of the litigation
relating to Zantac.
Financial information
Income statements
Q1 2024 Q1 2023
£m £m
TURNOVER 7,363 6,951
Cost of sales (1,970) (1,943)
Gross profit 5,393 5,008
Selling, general and administration (2,087) (2,143)
Research and development (1,434) (1,260)
Royalty income 151 180
Other operating income/(expense) (533) 297
OPERATING PROFIT 1,490 2,082
Finance income 32 29
Finance expense (166) (203)
Share of after tax profit/(loss) of associates and joint ventures (1) (2)
Profit/(loss) on disposal of interests in associates and joint ventures - 1
PROFIT BEFORE TAXATION 1,355 1,907
Taxation (274) (276)
Tax rate % 20.2% 14.5%
PROFIT AFTER TAXATION 1,081 1,631
Profit attributable to non-controlling interests 35 141
Profit attributable to shareholders 1,046 1,490
1,081 1,631
EARNINGS PER SHARE 25.7p 36.8p
Diluted earnings per share 25.4p 36.5p
Statement of comprehensive income
Q1 2024 Q1 2023
£m £m
Total profit for the period 1,081 1,631
Items that may be reclassified subsequently to income statement:
Exchange movements on overseas net assets and net investment hedges (190) 87
Reclassification of exchange movements on liquidation or disposal of - (3)
overseas subsidiaries and associates
Reclassification of cash flow hedges to income statement 2 1
(188) 85
Items that will not be reclassified to income statement:
Exchange movements on overseas net assets of non-controlling interests 3 (14)
Fair value movements on equity investments 78 (168)
Tax on fair value movements on equity investments (15) 22
Fair value movements on cash flow hedges 1 -
Remeasurement gains/(losses) on defined benefit plans 46 350
Tax on remeasurement losses/(gains) on defined benefit plans (10) (87)
103 103
Other comprehensive income/(expense) for the period (85) 188
Total comprehensive income for the period 996 1,819
Total comprehensive income for the period attributable to:
Shareholders 958 1,692
Non-controlling interests 38 127
996 1,819
Balance sheet
31 March 2024 31 December 2023
£m £m
ASSETS
Non-current assets
Property, plant and equipment 8,952 9,020
Right of use assets 915 937
Goodwill 6,978 6,811
Other intangible assets 15,667 14,768
Investments in associates and joint ventures 46 55
Other investments 1,231 1,137
Deferred tax assets 5,863 6,049
Other non-current assets 1,654 1,584
Total non-current assets 41,306 40,361
Current assets
Inventories 5,702 5,498
Current tax recoverable 460 373
Trade and other receivables 6,831 7,385
Derivative financial instruments 57 130
Current equity investments 1,284 2,204
Liquid investments 21 42
Cash and cash equivalents 2,790 2,936
Assets held for sale 60 76
Total current assets 17,205 18,644
TOTAL ASSETS 58,511 59,005
LIABILITIES
Current liabilities
Short-term borrowings (2,616) (2,813)
Contingent consideration liabilities (1,094) (1,053)
Trade and other payables (14,621) (15,844)
Derivative financial instruments (69) (114)
Current tax payable (720) (500)
Short-term provisions (726) (744)
Total current liabilities (19,846) (21,068)
Non-current liabilities
Long-term borrowings (15,156) (15,205)
Corporation tax payable (76) (75)
Deferred tax liabilities (288) (311)
Pensions and other post-employment benefits (2,306) (2,340)
Other provisions (510) (495)
Contingent consideration liabilities (5,981) (5,609)
Other non-current liabilities (1,119) (1,107)
Total non-current liabilities (25,436) (25,142)
TOTAL LIABILITIES (45,282) (46,210)
NET ASSETS 13,229 12,795
EQUITY
Share capital 1,348 1,348
Share premium account 3,471 3,451
Retained earnings 7,935 7,239
Other reserves 1,086 1,309
Shareholders' equity 13,840 13,347
Non-controlling interests (611) (552)
TOTAL EQUITY 13,229 12,795
Statement of changes in equity
Share Share Retained Other Share- Non- Total
capital premium earnings reserves holder's controlling equity
£m £m £m £m equity interests £m
£m £m
At 1 January 2024 1,348 3,451 7,239 1,309 13,347 (552) 12,795
Profit for the period 1,046 1,046 35 1,081
Other comprehensive (151) 63 (88) 3 (85)
income/(expense) for the period
Total comprehensive income/(expense) 895 63 958 38 996
for the period
Distributions to non-controlling interests (97) (97)
Dividends to shareholders (568) (568) (568)
Realised after tax losses on disposal (47) 47 -
or liquidation of equity investments
Share of associates and joint ventures 15 (15) -
realised profit/(loss) on disposal of
equity investments
Shares issued 18 18 18
Write-down on shares held by ESOP Trusts (141) 141 -
Shares acquired by ESOP Trusts 2 457 (459) -
Share-based incentive plans 85 85 85
At 31 March 2024 1,348 3,471 7,935 1,086 13,840 (611) 13,229
Share Share Retained Other Share- Non- Total
capital premium earnings reserves holder's controlling equity
£m £m £m £m equity interests £m
£m £m
At 1 January 2023 1,347 3,440 4,363 1,448 10,598 (502) 10,096
Profit for the period 1,490 - 1,490 141 1,631
Other comprehensive 336 (134) 202 (14) 188
income/(expense) for the period
Total comprehensive income/(expense) 1,826 (134) 1,692 127 1,819
for the period
Distributions to non-controlling interests (140) (140)
Contributions from non-controlling 7 7
interests
Dividends to shareholders (555) (555) (555)
Realised after tax losses on disposal or (13) 13 -
liquidation of equity investments
Share of associates and joint ventures 2 (2) -
realised profits on disposal of equity
investments
Share issued 1 7 8 8
Write-down of shares held by ESOP Trusts (48) 48 -
Shares acquired by ESOP Trusts 2 1 (3) -
Share-based incentive plans 79 79 79
Hedging gain/(loss) after taxation (2) (2) (2)
transferred to non-financial assets
At 31 March 2023 1,348 3,449 5,655 1,368 11,820 (508) 11,312
Cash flow statement three months ended 31 March 2024
Q1 2024 Q1 2023
£m £m
Profit after tax 1,081 1,631
Tax on profits 274 276
Share of after tax loss/(profit) of associates and joint ventures 1 2
(Profit)/loss on disposal of interest in associates and joint ventures - (1)
Net finance expense 134 174
Depreciation, amortisation and other adjusting items 549 640
Decrease/(increase) in working capital (311) (840)
Contingent consideration paid (306) (290)
Decrease in other net liabilities (excluding contingent consideration paid) (296) (1,305)
Cash generated from operations 1,126 287
Taxation paid (168) (234)
Total net cash inflow/(outflow) from operating activities 958 53
Cash flow from investing activities
Purchase of property, plant and equipment (248) (233)
Proceeds from sale of property, plant and equipment 1 7
Purchase of intangible assets (315) (296)
Proceeds from sale of intangible assets 27 4
Purchase of equity investments (18) (56)
Proceeds from sale of equity investments 1,055 10
Purchase of businesses, net of cash acquired (719) -
Contingent consideration paid (3) (1)
Disposal of businesses (3) (6)
Interest received 37 29
Decrease/(Increase) in liquid investments 22 -
Dividends from joint ventures and associates - 1
Dividend and distributions from investments 15 132
Proceeds from disposal of associates and Joint ventures - 1
Total net cash inflow/(outflow) from investing activities (149) (408)
Cash flow from financing activities
Issue of share capital 18 8
Repayment of long-term loans - (144)
Net increase/(repayment) of other short-term loans (323) 552
Repayment of lease liabilities (57) (47)
Interest paid (71) (120)
Dividends paid to shareholders (568) (555)
Shares acquired by ESOP Trusts - (2)
Distribution to non-controlling interests (97) (140)
Contributions from non-controlling interests - 7
Other financing items 38 123
Total net cash inflow/(outflow) from financing activities (1,060) (318)
Increase/(decrease) in cash and bank overdrafts in the period (251) (673)
Cash and bank overdrafts at beginning of the period 2,858 3,425
Exchange adjustments (19) (31)
Increase/(decrease) in cash and bank overdrafts (251) (673)
Cash and bank overdrafts at end of the period 2,588 2,721
Cash and bank overdrafts at end of the period comprise:
Cash and cash equivalents 2,790 2,890
Overdrafts (202) (169)
2,588 2,721
Vaccines turnover - three months ended 31 March 2024
Total US Europe International
Growth Growth Growth Growth
£m £% CER% £m £% CER% £m £% CER% £m £% CER%
Shingles 945 13 18 470 (7) (4) 229 7 9 246 >100 >100
Shingrix 945 13 18 470 (7) (4) 229 7 9 246 >100 >100
Meningitis 299 7 11 121 2 6 101 (12) (10) 77 67 74
Bexsero 217 - 3 72 (3) 1 98 (11) (8) 47 38 41
Menveo 80 36 41 49 9 13 2 (50) (50) 29 >100 >100
Other 2 (33) - - - - 1 - - 1 (50) -
RSV 182 - - 154 - - 1 - - 27 - -
Arexvy 182 - - 154 - - 1 - - 27 - -
Influenza 13 8 8 2 >100 >100 - - - 11 - -
Fluarix, FluLaval 13 8 8 2 >100 >100 - - - 11 - -
Established Vaccines 838 3 7 331 (6) (3) 178 (8) (6) 329 22 28
Infanrix, Pediarix 145 (18) (15) 87 (19) (16) 31 (6) (6) 27 (25) (22)
Boostrix 138 (1) 3 85 (8) (3) 33 6 10 20 25 25
Hepatitis 175 3 6 91 (7) (4) 51 11 13 33 27 35
Rotarix 154 12 17 57 21 26 29 (12) (9) 68 17 24
Synflorix 45 (27) (24) - - - 2 (75) (75) 43 (20) (17)
Priorix, Priorix Tetra, 78 47 53 6 >100 >100 29 (12) (9) 43 >100 >100
Varilrix
Cervarix 32 19 26 - - - 4 (56) (56) 28 56 67
Other 71 45 47 5 (17) (33) (1) >(100) >(100) 67 56 63
Vaccines excluding 2,277 17 22 1,078 10 14 509 (2) - 690 58 66
COVID-19 solutions
Pandemic vaccines - >(100) >(100) - - - - (100) (100) - - -
Pandemic adjuvant - >(100) >(100) - - - - (100) (100) - - -
Vaccines 2,277 12 16 1,078 10 14 509 (18) (17) 690 58 66
Specialty Medicines turnover - three months ended 31 March 2024
Total US Europe International
Growth Growth Growth Growth
£m £% CER% £m £% CER% £m £% CER% £m £% CER%
HIV 1,613 10 14 1,031 12 17 364 5 7 218 6 15
Dolutegravir products 1,304 2 6 772 2 5 324 2 3 208 5 14
Tivicay 354 (1) 4 186 1 4 64 (3) (2) 104 (2) 8
Triumeq 310 (17) (14) 211 (15) (12) 59 (21) (20) 40 (20) (16)
Juluca 157 5 8 122 10 14 32 (9) (6) 3 (25) (25)
Dovato 483 22 27 253 18 22 169 18 20 61 61 74
Rukobia 33 32 36 31 35 39 2 - - - - -
Cabenuva 213 68 73 171 66 73 35 75 80 7 75 50
Apretude 54 >100 >100 54 >100 >100 - - - - - -
Other 9 (40) (27) 3 (57) (43) 3 (40) (40) 3 - 33
Respiratory/Immunology 635 6 11 378 (4) - 132 22 25 125 25 37
and Other
Nucala 374 8 13 180 (5) (2) 109 22 26 85 23 36
Benlysta 260 3 8 198 (3) 1 27 17 22 35 35 46
Other 1 - - - - - (4) - (25) 5 - -
Oncology 273 >100 >100 186 >100 >100 75 4 6 12 33 33
Zejula 141 24 27 72 44 50 58 5 7 11 22 22
Blenrep - (100) >(100) (1) - - 1 (91) (91) - - -
Jemperli 80 >100 >100 65 >100 >100 14 >100 >100 1 - 100
Ojjaara 52 - - 50 - - 2 - - - - -
Other - - - - - - - - - - - -
Specialty Medicines 2,521 14 19 1,595 17 21 571 9 11 355 13 23
excluding COVID-19
solutions
Pandemic 1 (97) (97) - - - - - - 1 (97) (97)
Xevudy 1 (97) (97) - - - - - - 1 (97) (97)
Specialty Medicines 2,522 13 17 1,595 17 21 571 9 11 356 3 12
General Medicines turnover - three months ended 31 March 2024
Total US Europe International
Growth Growth Growth Growth
£m £% CER% £m £% CER% £m £% CER% £m £% CER%
Respiratory 1,725 (2) 2 863 4 8 361 (3) (1) 501 (11) (4)
Anoro Ellipta 119 (1) 3 44 (14) (10) 52 13 15 23 - 4
Flixotide/Flovent 139 (11) (8) 95 (10) (8) 18 (14) (10) 26 (13) (10)
Relvar/Breo Ellipta 270 (1) 4 99 (1) 2 98 - 2 73 (4) 8
Seretide/Advair 282 (17) (13) 92 (23) (21) 61 (14) (13) 129 (13) (6)
Trelegy Ellipta 591 27 33 425 30 35 75 12 13 91 28 41
Ventolin 168 (18) (15) 86 (20) (17) 25 (11) (7) 57 (17) (14)
Other Respiratory 156 (25) (20) 22 10 20 32 (22) (22) 102 (30) (25)
Other General Medicines 839 (7) (2) 53 (42) (41) 180 (2) 1 606 (4) 2
Augmentin 186 5 10 - - - 54 (4) (2) 132 9 16
Lamictal 101 (22) (19) 37 (44) (42) 28 - 4 36 3 9
Other "Other General Medicines" 552 (8) (3) 16 (38) (38) 98 (1) 1 438 (8) (1)
General Medicines 2,564 (4) 1 916 (1) 3 541 (3) (1) 1,107 (7) (1)
Commercial Operations turnover
Total US Europe International
Growth Growth Growth Growth
£m £% CER% £m £% CER% £m £% CER% £m £% CER%
Three months ended 31 March 2024 7,363 6 10 3,589 10 14 1,621 (5) (3) 2,153 9 16
Commercial Operations turnover excluding COVID-19 solutions
Total US Europe International
Growth Growth Growth Growth
£m £% CER% £m £% CER% £m £% CER% £m £% CER%
Three months ended 31 March 2024 7,362 8 13 3,589 10 14 1,621 1 3 2,152 11 18
Segment information
Operating segments are reported based on the financial information provided to
the Chief Executive Officer and the responsibilities of the GSK Leadership
Team (GLT). GSK reports results under two segments: Commercial Operations and
Total R&D. Members of the GLT are responsible for each segment.
R&D investment is essential for the sustainability of the business.
However, for segment reporting the Commercial operating profits exclude
allocations of globally funded R&D.
The Total R&D segment is the responsibility of the Chief Scientific
Officer and is reported as a separate segment. The operating costs of this
segment includes R&D activities across Specialty Medicines, including HIV
and Vaccines. It includes R&D and some SG&A costs relating to
regulatory and other functions.
The Group's management reporting process allocates intra-Group profit on a
product sale to the market in which that sale is recorded, and the profit
analyses below have been presented on that basis.
Turnover by segment
Q1 2024 Q1 2023 Growth Growth
£m £m £% CER%
Commercial Operations (total turnover) 7,363 6,951 6 10
Operating profit by segment
Q1 2024 Q1 2023 Growth Growth
£m £m £% CER%
Commercial Operations 3,855 3,375 14 21
Research and Development (1,308) (1,232) 6 9
Segment profit 2,547 2,143 19 28
Corporate and other unallocated costs (104) (51)
Core operating profit 2,443 2,092 17 27
Adjusting items (953) (10)
Total operating profit 1,490 2,082 (28) (18)
Finance income 32 29
Finance costs (166) (203)
Share of after tax profit/(loss) of associates and (1) (2)
joint ventures
Profit/(loss) on disposal of associates and joint ventures - 1
Profit before taxation 1,355 1,907 (29) (18)
Commercial Operations Core operating profit of £3,855 million grew in the
quarter driven by strong sales and a favourable product mix and a reversal of
the Zejula royalty dispute legal provision, partly offset by disciplined
investment in growth assets and lower royalty income.
The R&D segment operating expenses of £1,308 million, grew in the
quarter driven by continued investment across disease areas including late
stage investment in Vaccines, Respiratory/Immunology and Infectious Diseases,
including pneumococcal and mRNA programmes, and camlipixant. This was partly
offset by decreases related to the completion of late-stage clinical
development programmes including RSV and momelotinib, and reduced investment
in Zejula versus Q1 2023. In the quarter restructuring of the research
division was broadly completed, with the charge being taken in Q4 2023.
Legal matters
The Group is involved in significant legal and administrative proceedings,
principally product liability, intellectual property, tax, anti-trust,
consumer fraud and governmental investigations, which are more fully described
in the 'Legal Proceedings' note in the Annual Report 2023. At 31 March 2024,
the Group's aggregate provision for legal and other disputes (not including
tax matters described on page 10) was £312 million (31 December 2023: £267
million).
The Group may become involved in significant legal proceedings in respect of
which it is not possible to meaningfully assess whether the outcome will
result in a probable outflow, or to quantify or reliably estimate the
liability, if any, that could result from ultimate resolution of the
proceedings. In these cases, the Group would provide appropriate disclosures
about such cases, but no provision would be made.
The ultimate liability for legal claims may vary from the amounts provided and
is dependent upon the outcome of litigation proceedings, investigations and
possible settlement negotiations. The Group's position could change over time,
and, therefore, there can be no assurance that any losses that result from the
outcome of any legal proceedings will not exceed by a material amount the
amount of the provisions reported in the Group's financial accounts.
Significant legal developments since the date of the Annual Report 2023:
Intellectual Property
RSV
The United States District Court for the District of Delaware has set a trial
date of 3 August 2026 in the suit against Pfizer Inc. alleging infringement of
US GSK patents by Pfizer's RSV vaccine, ABRYSVO.
mRNA
On 25 April 2024, GSK filed a patent infringement suit against Pfizer Inc. and
BioNTech SE in the United States District Court for the District of Delaware
alleging infringement of five US GSK patents by the COVID-19 vaccine,
COMIRNATY.
Product Liability
Zantac
The Delaware Superior Court held a hearing regarding admissibility of expert
testimony as to general causation on 22-24 January 2024. The parties
continue to await a ruling from the Court, which will relate only to the
admissibility of evidence and not to the determination of liability or to the
merits of the underlying claims.
As announced on 29 February 2024, GSK reached a confidential settlement in the
Boyd/Steenvoord case filed in California state court. The case, which was set
to begin trial on 2 April 2024, will be dismissed. The settlement reflects the
company's desire to avoid the distraction related to protracted litigation in
this case. GSK did not admit any liability in the settlement and will continue
to vigorously defend itself based on the facts and the science in all other
Zantac cases.
In the California Judicial Council Coordination Proceedings (JCCP), the Court
has scheduled a Sargon hearing for 6-7 June 2024 for eight cases, including
two bellwether cases (Hughes and Caratti, cases alleging colorectal and
bladder cancer, respectively). The Court has set a trial date for the Hughes
case of 8 July 2024, with Caratti to receive a trial date only after the
Hughes trial concludes. The other six cases do not have trial dates pending
their transfer to other counties in California. A separate Sargon hearing for
a further 12 cases has been set for 15 August 2024. The Court has also ordered
the parties to work up 350 cases for trial.
Trial dates have also been set in other state courts. In Illinois, the first
case scheduled for trial (Valadez, a case alleging colorectal cancer) began on
30 April 2024 and is expected to last around four weeks. The second Illinois
case (Williams, a case alleging lung cancer) is scheduled for trial on 23 May
2024. Three other cases have trial dates in Illinois ahead of the expected
publication date of GSK's results for Q2 2024 (Gross and Kasza, cases alleging
prostate and breast cancer, respectively on 5 June 2024 and Kimbrow, a case
alleging prostate cancer, on 12 July 2024). On 16 April 2024, the Illinois
court issued a Frye ruling in Valadez, finding that the plaintiff's experts'
causation opinions are admissible and can be presented to a jury. The single
case in Texas is set for trial on 21 October 2024 and one case in Nevada is
scheduled for trial on 3 March 2025.
Given the current stage of the proceedings, GSK cannot meaningfully assess
what liability, if any, it may have, nor can it meaningfully assess the
liability of other parties under relevant indemnification provisions.
Returns to shareholders
Quarterly dividends
The Board has declared a first interim dividend for Q1 2024 of 15p per share
(Q1 2023: 14p per share).
Dividends remain an essential component of total shareholder return and GSK
recognises the importance of dividends to shareholders. On 23 June 2021, at
the GSK Investor Update, GSK set out that from 2022 a progressive dividend
policy will be implemented guided by a 40 to 60 percent pay-out ratio through
the investment cycle. Consistent with this, GSK has declared a dividend of 15p
for Q1 2024 and expects to declare a dividend of 60p per share for full year
2024. In setting its dividend policy, GSK considers the capital allocation
priorities of the Group and its investment strategy for growth alongside the
sustainability of the dividend.
Payment of dividends
The equivalent interim dividend receivable by ADR holders will be calculated
based on the exchange rate on 9 July 2024. An annual fee of $0.03 per ADS (or
$0.0075 per ADS per quarter) is charged by the Depositary. The ex-dividend
date will be 16 May 2024, with a record date of 17 May 2024 and a payment date
of 11 July 2024.
Paid/ Pence per £m
Payable share
2024
First interim 11 July 2024 15 612
2023
First interim 13 July 2023 14 567
Second interim 12 October 2023 14 568
Third interim 11 January 2024 14 568
Fourth interim 11 April 2024 16 652
58 2,355
Share capital in issue
At 31 March 2024, 4,078 million shares (Q1 2023: 4,052 million) were in free
issue (excluding Treasury shares and shares held by the ESOP Trusts). No
Treasury shares have been repurchased since 2014. The company issued 1.9
million shares under employee share schemes in the year for proceeds of £18
million (Q1 2023: £8 million).
At 31 March 2024, the ESOP Trusts held 66.9 million shares of GSK shares, of
which 66.6 million were held for the future exercise of share options and
share awards and 0.3 million were held for the Executive Supplemental Savings
plan. The carrying value of £611 million has been deducted from other
reserves. The market value of these shares was £1,144 million.
At 31 March 2024, the company held 169 million Treasury shares at a cost of
£2,957 million which has been deducted from retained earnings.
Weighted average number of shares
The numbers of shares used in calculating basic and diluted earnings per share
are reconciled below:
Q1 2024 Q1 2023
millions millions
Weighted average number of shares - basic 4,069 4,044
Dilutive effect of share options and share awards 44 41
Weighted average number of shares - diluted 4,113 4,085
Additional information
Accounting policies and basis of preparation
This unaudited Results Announcement contains condensed financial information
for the three months ended 31 March 2024 and should be read in conjunction
with the Annual Report 2023, which was prepared in accordance with United
Kingdom adopted International Financial Reporting Standards. This Results
Announcement has been prepared applying consistent accounting policies to
those applied by the Group in the Annual Report 2023.
The Group has not identified any changes to its key sources of accounting
judgements or estimations of uncertainty compared with those disclosed in the
Annual Report 2023.
This Results Announcement does not constitute statutory accounts of the Group
within the meaning of sections 434(3) and 435(3) of the Companies Act 2006.
The full Group accounts for 2023 were published in the Annual Report 2023,
which has been delivered to the Registrar of Companies and on which the report
of the independent auditor was unqualified and did not contain a statement
under section 498 of the Companies Act 2006.
Exchange rates
GSK operates in many countries and earns revenues and incurs costs in many
currencies. The results of the Group, as reported in Sterling, are affected by
movements in exchange rates between Sterling and other currencies. Average
exchange rates, as modified by specific transaction rates for large
transactions, prevailing during the period, are used to translate the results
and cash flows of overseas subsidiaries, associates and joint ventures into
Sterling. Period-end rates are used to translate the net assets of those
entities. The currencies which most influenced these translations and the
relevant exchange rates were:
Q1 2024 Q1 2023 2023
Average rates:
US$/£ 1.27 1.22 1.24
Euro/£ 1.16 1.14 1.15
Yen/£ 187 162 175
Period-end rates:
US$/£ 1.26 1.24 1.27
Euro/£ 1.17 1.14 1.15
Yen/£ 191 165 180
Contingent liabilities
There were contingent liabilities at 31 March 2024 in respect of arrangements
entered into as part of the ordinary course of the Group's business. No
material losses are expected to arise from such contingent liabilities.
Provision is made for the outcome of legal and tax disputes where it is both
probable that the Group will suffer an outflow of funds and it is possible to
make a reliable estimate of that outflow. Descriptions of the significant
legal disputes to which the Group is a party are set out on page 32 and pages
263 to 266 of the 2023 Annual Report.
Net assets
The book value of net assets increased by £434 million from £12,795 million
at 31 December 2023 to £13,229 million at 31 March 2024. This primarily
reflected contribution from Total comprehensive income for the period partly
offset by dividends paid to shareholders.
At 31 March 2024, the net deficit on the Group's pension plans was £721
million compared with £764 million at 31 December 2023. This decrease in the
net deficit is primarily due to increases in the UK and US discount rates, as
well as experience adjustments, partially offset by lower UK asset values and
an increase to the US cash balance credit rate.
The estimated present value of the potential redemption amount of the Pfizer
put option related to ViiV Healthcare, recorded in Other payables in Current
liabilities, was £914 million (31 December 2023: £848 million).
Contingent consideration amounted to £7,075 million at 31 March 2024 (31
December 2023: £6,662 million), of which £6,004 million (31 December 2023:
£5,718 million) represented the estimated present value of amounts payable to
Shionogi relating to ViiV Healthcare, £446 million (31 December 2023: £423
million) represented the estimated present value of contingent consideration
payable to Novartis related to the Vaccines acquisition, £527 million (31
December 2023: £516 million) represented the estimated present value of
contingent consideration payable to Affinivax, and £95 million (31 December
2023: £nil) represented the estimated present value of contingent
consideration payable in relation to the Aiolos acquisition. Of the contingent
consideration payable to Shionogi at 31 March 2024, £1,057 million (31
December 2023: £1,017 million) is expected to be paid within one year.
Movements in contingent consideration are as follows:
Q1 2024 ViiV Group
Healthcare £m
£m
Contingent consideration at beginning of the period 5,718 6,662
Remeasurement through income statement and other movements 586 722
Cash payments: operating cash flows (300) (306)
Cash payments: investing activities - (3)
Contingent consideration at end of the period 6,004 7,075
Q1 2023 ViiV Group
Healthcare £m
£m
Contingent consideration at beginning of the period 5,890 7,068
Remeasurement through income statement and other movements (64) (193)
Cash payments: operating cash flows (287) (290)
Cash payments: investing activities - (1)
Contingent consideration at end of the period 5,539 6,584
Business acquisitions
On 9 January 2024, GSK announced it had entered into an agreement to acquire
Aiolos Bio, Inc. (Aiolos) a clinical stage biopharmaceutical company focused
on addressing the unmet treatment needs of patients with certain respiratory
and inflammatory conditions, for a total consideration of US$1,004 million
(£800 million) as adjusted for working capital acquired paid upon closing and
up to US$400 million (£319 million) in certain success-based regulatory
milestone payments. The estimated fair value of the contingent consideration
payable was US$120 million (£96 million). In addition, GSK will also be
responsible for success-based milestone payments as well as tiered royalties
owed to Jiangsu Hengrui Pharmaceuticals Co., Ltd. (Hengrui). The acquisition
completed on 14 February 2024.
The initial acquisition accounting was reflected in the first quarter of 2024
on a preliminary basis, the values below are provisional and subject to
change. The purchase price allocation is expected to be completed by the end
of Q4 2024.
The provisional fair values of the net assets acquired, including goodwill,
are as follows:
£m
Net assets acquired:
Intangible assets 927
Cash and cash equivalents 23
Other net liabilities (16)
Deferred tax liabilities (197)
737
Goodwill 159
Total consideration 896
Of the £896 million consideration, £154 million was unpaid as at 31 March
2024.
Net debt information
Reconciliation of cash flow to movements in net debt
Q1 2024 Q1 2023
£m £m
Total Net debt at beginning of the period (15,040) (17,197)
Increase/(decrease) in cash and bank overdrafts (251) (673)
(Increase)/decrease in liquid investments (22) -
Net increase/(repayment) of other short-term loans 323 (552)
Repayment of long-term notes - 144
Repayment of lease liabilities 57 47
Exchange adjustments 1 322
Other non-cash movements (29) (41)
Decrease/(increase) in net debt 79 (753)
Total Net debt at end of the period (14,961) (17,950)
Net debt analysis
31 March 2024 31 December 2023
£m £m
Liquid investments 21 42
Cash and cash equivalents 2,790 2,936
Short-term borrowings (2,616) (2,813)
Long-term borrowings (15,156) (15,205)
Total Net debt at the end of the period (14,961) (15,040)
Free cash flow reconciliation
Q1 2024 Q1 2023
£m £m
Net cash inflow/(outflow) from operating activities 958 53
Purchase of property, plant and equipment (248) (233)
Proceeds from sale of property, plant and equipment 1 7
Purchase of intangible assets (315) (296)
Proceeds from disposals of intangible assets 27 4
Net finance costs (34) (91)
Dividends and disposal proceeds from associates and joint ventures - 1
Contingent consideration paid (reported in investing activities) (3) (1)
Distributions to non-controlling interests (97) (140)
Contributions from non-controlling interests - 7
Free cash inflow/(outflow) 289 (689)
Related party transactions
Details of GSK's related party transactions are disclosed on page 235 of our
2023 Annual Report.
R&D commentary
Pipeline overview
Medicines and vaccines in phase III development (including major lifecycle 18 Infectious Diseases (7)
innovation or under regulatory review)
• Arexvy (RSV vaccine) RSV older adults (50-59 years of age)
• gepotidacin (bacterial topoisomerase inhibitor) uncomplicated urinary tract
infection and urogenital gonorrhoea
• bepirovirsen (HBV ASO) hepatitis B virus
• Bexsero infants vaccine (US)
• MenABCWY (gen 1) vaccine candidate
• tebipenem pivoxil (antibacterial carbapenem) complicated urinary tract
infection
• ibrexafungerp (antifungal glucan synthase inhibitor) invasive candidiasis
Respiratory/Immunology (6)
• Nucala (anti-IL5 biologic) chronic obstructive pulmonary disease
• depemokimab (ultra long-acting anti-IL5 biologic) severe eosinophilic asthma,
eosinophilic granulomatosis with polyangiitis (EGPA), chronic rhinosinusitis
with nasal polyps (CRSwNP), hyper-eosinophilic syndrome (HES)
• latozinemab (AL001, anti-sortilin) frontotemporal dementia
• camlipixant (P2X3 receptor antagonist) refractory chronic cough
• Ventolin (salbutamol, Beta 2 adrenergic receptor agonist) asthma
• linerixibat (IBATi) cholestatic pruritus in primary biliary cholangitis
Oncology (5)
• Ojjaara (JAK1, JAK2 and ACVR1 inhibitor) myelofibrosis with anaemia
• Blenrep (anti-BCMA ADC) multiple myeloma
• Jemperli (anti-PD-1) 1L endometrial cancer, colon cancer, rectal cancer, head
and neck cancer
• Zejula (PARP inhibitor) 1L ovarian and non-small cell lung cancer
• cobolimab (anti-TIM-3) 2L non-small cell lung cancer
Total vaccines and medicines in all phases of clinical development 72
Total projects in clinical development (inclusive of all phases and 91
indications)
Our key growth assets by therapy area
The following outlines several key vaccines and medicines by therapy area that
will help drive growth for GSK to meet its outlooks for 2021-2026 and beyond.
Infectious Diseases
Arexvy (respiratory syncytial virus vaccine, adjuvanted)
The US Food and Drug Administration (FDA) accepted under Priority Review an
application to extend the indication of GSK's adjuvanted respiratory syncytial
virus (RSV) vaccine to adults aged 50-59 who are at increased risk for RSV
disease. If approved, GSK's RSV vaccine would be the first vaccine available
to help protect this population. Arexvy is currently approved in the US in
adults aged 60 and over for the prevention of lower respiratory tract disease
(LRTD) caused by RSV.
Key phase III trials for Arexvy:
Trial name (population) Phase Design Timeline Status
RSV OA=ADJ-004 III A randomised, open-label, multi-country trial to evaluate the immunogenicity, Trial start: Active, not recruiting; primary endpoint met
safety, reactogenicity and persistence of a single dose of the RSVPreF3 OA
(Adults ≥ 60 years old) investigational vaccine and different revaccination schedules in adults aged Q1 2021
60 years and above
NCT04732871 Primary data reported:
Q2 2022
RSV OA=ADJ-006 III A randomised, placebo-controlled, observer-blind, multi-country trial to Trial start: Active, not recruiting; primary endpoint met
demonstrate the efficacy of a single dose of GSK's RSVPreF3 OA investigational
(ARESVI-006; Adults ≥ 60 years old) vaccine in adults aged 60 years and above Q2 2021
NCT04886596 Primary data reported:
Q2 2022;
two season data reported:
Q2 2023
RSV OA=ADJ-007 III An open-label, randomised, controlled, multi-country trial to evaluate the Trial start: Complete; primary endpoint met
immune response, safety and reactogenicity of RSVPreF3 OA investigational
(Adults ≥ 60 years old) vaccine when co-administered with FLU-QIV vaccine in adults aged 60 years and Q2 2021
above
NCT04841577 Primary data reported:
Q4 2022
RSV OA=ADJ-008 III A phase III, open-label, randomised, controlled, multi country trial to Trial start: Complete
evaluate the immune response, safety and reactogenicity of RSVPreF3 OA
investigational vaccine when co-administered with FLU HD vaccine in adults Q4 2022
aged 65 years and above
(Adults ≥ 65 years old)
Primary data reported:
NCT05559476 Q2 2023
RSV OA=ADJ-009 III A randomised, double-blind, multi-country trial to evaluate consistency, Trial start: Complete; primary endpoint met
safety, and reactogenicity of 3 lots of RSVPreF3 OA investigational vaccine
(Adults ≥ 60 years old) administrated as a single dose in adults aged 60 years and above Q4 2021
NCT05059301 Trial end:
Q2 2022
RSV OA=ADJ-017 III A phase III, open-label, randomised, controlled, multi-country trial to Trial start: Complete
evaluate the immune response, safety and reactogenicity of an RSVPreF3 OA
(Adults ≥ 65 years old) investigational vaccine when co-administered with FLU aQIV (inactivated Q4 2022
influenza vaccine - adjuvanted) in adults aged 65 years and above
NCT05568797 Primary data reported:
Q2 2023
RSV OA=ADJ-018 III A phase III, observer-blind, randomised, placebo-controlled trial to evaluate Trial start: Active, not recruiting; primary endpoint met
the non-inferiority of the immune response and safety of the RSVPreF3 OA
(Adults 50-59 years) investigational vaccine in adults 50-59 years of age, including adults at Q4 2022
increased risk of respiratory syncytial virus lower respiratory tract disease,
compared to older adults ≥60 years of age
NCT05590403 Primary data reported:
Q4 2023
RSV OA=ADJ-019 III An open-label, randomised, controlled, multi-country trial to evaluate the Trial start: Active, not recruiting
immune response, safety and reactogenicity of RSVPreF3 OA investigational
(Adults ≥ 60 years old) vaccine when co-administered with PCV20 in adults aged 60 years and older Q2 2023
Data anticipated:
NCT05879107 H2 2024
RSV OA=ADJ-023 IIb A randomised, controlled, open-label trial to evaluate the immune response and Trial start: Active, recruiting
safety of the RSVPreF3 OA investigational vaccine in adults (≥50 years of
(Immunocompromised Adults 50-59 years) age) when administered to lung and renal transplant recipients comparing one Q3 2023
versus two doses and compared to healthy controls (≥50 years of age)
receiving one dose Data anticipated: 2025
NCT05921903
RSV-OA=ADJ-020 (Adults, aged >=50 years of age) III A study on the safety and immune response of investigational RSV OA vaccine in Trial start: Active, not recruiting
combination with herpes zoster vaccine in healthy adults
NCT05966090 Q3 2023
Data anticipated:
H2 2024
bepirovirsen (HBV ASO)
Bepirovirsen, a triple-action antisense oligonucleotide, is a potential new
treatment option for people with chronic hepatitis B (CHB). In February 2024,
the US FDA granted Fast Track designation for bepirovirsen for the treatment
of CHB. Fast Track designation is intended to facilitate the development and
expedite the review of medicines to treat serious conditions and fill an unmet
medical need. To further expand development in novel sequential regimens, GSK
has entered an agreement for an exclusive worldwide license to develop and
commercialise daplusiran/tomligisiran (GSK5637608, formerly JNJ-3989), an
investigational hepatitis B virus-targeted small interfering ribonucleic acid
(siRNA) therapeutic. This agreement provides an opportunity to investigate a
novel sequential regimen to pursue functional cure in an even broader patient
population with bepirovirsen.
Key trials for bepirovirsen:
Trial name (population) Phase Design Timeline Status
B-Well 1 bepirovirsen in nucleos(t)ide treated patients (chronic hepatitis B) III A multi-centre, randomised, double-blind, placebo-controlled trial to confirm Trial Start: Recruiting
the efficacy and safety of treatment with bepirovirsen in participants with
NCT05630807 chronic hepatitis B virus Q1 2023
Data anticipated: 2026+
B-Well 2 bepirovirsen in nucleos(t)ide treated patients (chronic hepatitis B) III A multi-centre, randomised, double-blind, placebo-controlled trial to confirm Trial Start: Recruiting
the efficacy and safety of treatment with bepirovirsen in participants with
chronic hepatitis B virus Q1 2023
NCT05630820
Data anticipated: 2026+
bepirovirsen sequential combination therapy with targeted immunotherapy II A trial on the safety, efficacy and immune response following sequential Trial start: Active, not recruiting
treatment with an anti-sense oligonucleotide against chronic hepatitis B (CHB)
(chronic hepatitis B) and chronic hepatitis B targeted immunotherapy (CHB-TI) in CHB patients Q2 2022
receiving nucleos(t)ide analogue (NA) therapy
NCT05276297 Data anticipated: 2025
gepotidacin (bacterial topoisomerase inhibitor)
Gepotidacin is an investigational bactericidal, first-in-class antibiotic with
a novel mechanism of action for the treatment of uncomplicated urinary tract
infections (uUTI). In February 2024, positive headline results were announced
from the pivotal EAGLE-1 phase III trial for gepotidacin showing the primary
endpoint was met. Gepotidacin achieved a 92.6% microbiological success rate
compared to a 91.2% success rate of intramuscular ceftriaxone plus oral
azithromycin combined therapy (a leading combination treatment regimen for
gonorrhoea), demonstrating non-inferiority. Safety and tolerability data were
consistent with results seen in gepotidacin phase I and II trials. The data
were presented at the 2024 European Society of Clinical Microbiology and
Infectious Diseases (ESCMID) Global in April 2024.
EAGLE-1 is the third positive pivotal trial for gepotidacin and demonstrates
its potential to provide a new oral treatment option for patients given the
rising incidence of gonorrhoea worldwide, including drug resistant infections.
Key phase III trials for gepotidacin:
Trial name (population) Phase Design Timeline Status
EAGLE-1 (uncomplicated urogenital gonorrhoea) III A randomised, multi-centre, open-label trial in adolescent and adult Trial start: Complete;
participants comparing the efficacy and safety of gepotidacin to ceftriaxone
plus azithromycin in the treatment of uncomplicated urogenital gonorrhoea Q4 2019 primary endpoint met
caused by Neisseria gonorrhoeae
NCT04010539
Data reported:
Q1 2024
EAGLE-2 (females with uUTI / acute cystitis) III A randomised, multi-centre, parallel-group, double-blind, double-dummy trial Trial start: Complete; primary endpoint met
in adolescent and adult female participants comparing the efficacy and safety
of gepotidacin to nitrofurantoin in the treatment of uncomplicated urinary Q4 2019
tract infection (acute cystitis)
NCT04020341
Data reported:
Q2 2023
EAGLE-3 (females with uUTI / acute cystitis) III A randomised, multi-centre, parallel-group, double-blind, double-dummy trial Trial start: Complete; primary endpoint met
in adolescent and adult female participants comparing the efficacy and safety
of gepotidacin to nitrofurantoin in the treatment of uncomplicated urinary Q2 2020
tract infection (acute cystitis)
NCT04187144
Data reported:
Q2 2023
MenABCWY vaccine candidate
The US FDA accepted a Biologics License Application (BLA) for GSK's 5-in-1
meningococcal ABCWY (MenABCWY) vaccine candidate on 16 April 2024 and set a
Prescription Drug User Fee Act (PDUFA) action date of 14 February 2025. GSK's
MenABCWY vaccine candidate combines the antigenic components of its two
well-established meningococcal vaccines with demonstrated efficacy and safety
profiles, Bexsero (Meningococcal Group B Vaccine) and Menveo (Meningococcal
Groups A, C, Y, and W-135). Combining the protection offered by these vaccines
aims to reduce the number of injections, simplifying immunisation and
potentially increasing series completion and vaccination coverage of
adolescents and young adults.
Key trials for MenABCWY vaccine candidate:
Trial name (population) Phase Design Timeline Status
MenABCWY - 019 IIIb A randomised, controlled, observer-blind trial to evaluate safety and Trial start: Complete
immunogenicity of GSK's meningococcal ABCWY vaccine when administered in
healthy adolescents and adults, previously primed with meningococcal ACWY Q1 2021
vaccine
NCT04707391
Data reported:
Q1 2024
MenABCWY - V72 72 III A randomised, controlled, observer-blind trial to demonstrate effectiveness, Trial start: Complete; primary endpoints met
immunogenicity, and safety of GSK's meningococcal Group B and combined ABCWY
vaccines when administered to healthy adolescents and young adults Q3 2020
NCT04502693
Data reported:
Q1 2023
HIV
cabotegravir
GSK continues to advance its early-stage HIV pipeline focused on innovative
long-acting injectable regimens and expects cabotegravir to increasingly
replace dolutegravir as the foundational integrase inhibitor in its portfolio
by the second half of the decade. In February 2024, ViiV Healthcare announced
results from an interim analysis of the LATITUDE phase III trial after the
trial's Data Safety Monitoring Board recommended it be modified to stop
randomisation and give participants receiving daily oral therapy the option to
transition to long-acting injectable therapy. Results indicated that
long-acting injectable antiretroviral treatment (ART) for HIV, Cabenuva
(cabotegravir + rilpirivine), demonstrated superior efficacy in maintaining
viral load suppression compared to daily oral therapy in individuals with a
history of ART adherence challenges.
In March 2024, ViiV Healthcare presented 64 abstracts at the Conference on
Retroviruses and Opportunistic Infections (CROI), in Denver, Colorado,
including highlights of the company's next-generation pipeline advancements
and data from its diverse portfolio of marketed HIV treatment and prevention
options. Detailed results from the LATITUDE trial were presented, together
with positive findings from a phase I study showing that an investigational
formulation of cabotegravir, known as cabotegravir ultra long-acting
(CAB-ULA), can be dosed at intervals of at least four months. This is the
company's first step towards delivering ultra long-acting injectable HIV
treatment and prevention medicines that would potentially enable people to
have at least four months between visits to the clinic.
Respiratory/Immunology
camlipixant (P2X3 receptor antagonist)
Camlipixant (BLU-5937) is an investigational, highly selective oral P2X3
antagonist currently in development for first-line treatment of adult patients
suffering from refractory chronic cough (RCC). The CALM phase III development
programme to evaluate the efficacy and safety of camlipixant for use in adults
with RCC is ongoing.
Trial name (population) Phase Design Timeline Status
CALM-1 (refractory chronic cough) III A 52-week, randomised, double-blind, placebo-controlled, parallel-arm efficacy Trial start: Recruiting
and safety trial with open-label extension of camlipixant in adult
participants with refractory chronic cough, including unexplained chronic Q4 2022
cough
NCT05599191
Data anticipated:
2025
CALM-2 (refractory chronic cough) III A 24-week, randomised, double-blind, placebo-controlled, parallel-arm efficacy Trial start: Recruiting
and safety trial with open-label extension of camlipixant in adult
participants with refractory chronic cough, including unexplained chronic Q1 2023
cough
NCT05600777
Data anticipated:
2025
depemokimab (long acting anti-IL5)
Depemokimab is in late stage development for severe asthma, chronic
rhinosinusitis with nasal polyps (CRSwNP), hypereosinophilic syndrome (HES)
and eosinophilic granulomatosis with polyangiitis (EGPA). Depemokimab is the
first and only next-generation ultra-long-acting biologic engineered to have
enhanced binding affinity and high potency for IL-5, resulting in an extended
half-life and enabling dosing every six months.
The phase III programme for depemokimab continues to make progress across a
range of IL-5 mediated conditions with phase III data expected to begin
reading out in H1 2024.
Key phase III trials for depemokimab:
Trial name (population) Phase Design Timeline Status
SWIFT-1 (severe eosinophilic asthma) III A 52-week, randomised, double-blind, placebo-controlled, parallel-group, Trial start: Active, not recruiting
multi-centre trial of the efficacy and safety of depemokimab adjunctive
therapy in adult and adolescent participants with severe uncontrolled asthma Q1 2021
with an eosinophilic phenotype
NCT04719832
Data anticipated:
H1 2024
SWIFT-2 (severe eosinophilic asthma) III A 52-week, randomised, double-blind, placebo-controlled, parallel-group, Trial start: Active, not recruiting
multi-centre trial of the efficacy and safety of depemokimab adjunctive
therapy in adult and adolescent participants with severe uncontrolled asthma Q1 2021
with an eosinophilic phenotype
NCT04718103
Data anticipated:
H1 2024
Key phase III trials for depemokimab continued:
Trial name (population) Phase Design Timeline Status
AGILE (SEA) III A 52-week, open label extension phase of SWIFT-1 and SWIFT-2 to assess the Trial start: Recruiting
long-term safety and efficacy of depemokimab adjunctive therapy in adult and
(exten adolescent participants with severe uncontrolled asthma with an eosinophilic Q1 2022
phenotype
NCT05243680 sion)
Data anticipated:
2025
NIMBLE (SEA) III A 52-week, randomised, double-blind, double-dummy, parallel group, Trial start: Recruiting
multi-centre, non-inferiority trial assessing exacerbation rate, additional
measures of asthma control and safety in adult and adolescent severe asthmatic Q1 2021
participants with an eosinophilic phenotype treated with depemokimab compared
NCT04718389 with mepolizumab or benralizumab
Data anticipated:
2025
ANCHOR-1 (chronic rhinosinusitis with nasal polyps; CRSwNP) III Efficacy and safety of depemokimab in participants with CRSwNP Trial start: Active, not recruiting
Q2 2022
NCT05274750
Data anticipated:
H2 2024
ANCHOR-2 (CRSwNP) III Efficacy and safety of depemokimab in participants with CRSwNP Trial start: Active, not recruiting
Q2 2022
NCT05281523
Data anticipated:
H2 2024
OCEAN (eosinophilic granulomatosis with polyangiitis; EGPA) III Efficacy and safety of depemokimab compared with mepolizumab in adults with Trial start: Recruiting
relapsing or refractory EGPA
Q3 2022
NCT05263934 Data anticipated:
2025
DESTINY (hyper-eosinophilic syndrome; HES) III A 52-week, randomised, placebo-controlled, double-blind, parallel group, Trial start: Recruiting
multicentre trial of depemokimab in adults with uncontrolled HES receiving
standard of care (SoC) therapy Q3 2022
NCT05334368 Data anticipated:
2026+
Nucala (mepolizumab)
Nucala, is a first in class anti-IL-5 biologic. It been studied in over 4,000
patients in 41 clinical trials across several IL-5 mediated conditions. Nucala
is the only treatment approved for use in the US and Europe, across four IL-5
medicated conditions: severe asthma with an eosinophilic phenotype, EGPA, HES
and CRSwNP.
The MATINEE phase III trial investigating Nucala in patients with chronic
obstructive pulmonary disease (COPD) is expected to readout in the second half
of 2024.
Key phase trials for Nucala:
Trial name (population) Phase Design Timeline Status
MATINEE (chronic obstructive pulmonary disease; COPD) III A multicentre randomised, double-blind, parallel-group, placebo-controlled Trial start: Active, not recruiting
trial of mepolizumab 100 mg subcutaneously as add-on treatment in participants
with COPD experiencing frequent exacerbations and characterised by eosinophil Q4 2019
levels
NCT04133909 Data anticipated:
H2 2024
Oncology
Blenrep (belantamab mafodotin)
In February 2024, GSK presented positive results from the DREAMM-7 phase III
head-to-head trial evaluating belantamab mafodotin as a second-line or later
treatment for relapsed or refractory multiple myeloma at the American Society
of Clinical Oncology (ASCO) Plenary Series. The trial met its primary endpoint
of progression-free survival (PFS), with a statistically significant and
clinically meaningful 59% reduction in risk of disease progression or death
observed in patients with belantamab mafodotin combined with bortezomib plus
dexamethasone (BorDex) versus standard of care, daratumumab plus BorDex. A
median PFS of 36.6 months was observed with the belantamab mafodotin
combination versus 13.4 months with the daratumumab combination. The
belantamab mafodotin combination also resulted in clinically meaningful
improvements in all secondary efficacy endpoints including a doubling of
complete response rate (stringent complete response plus complete response),
minimal residual disease negativity rate and median duration of response. A
strong and clinically meaningful overall survival (OS) trend was observed at
the interim analysis, with a 43% reduction in the risk of death. OS follow-up
continues and further analyses are planned.
In March 2024, GSK announced positive headline results from a planned interim
analysis of the DREAMM-8 phase III head-to-head trial evaluating belantamab
mafodotin, in combination with pomalidomide plus dexamethasone (PomDex),
versus a standard of care, bortezomib plus PomDex, as a second line and later
treatment for relapsed or refractory multiple myeloma. The trial met its
primary endpoint of PFS, with the belantamab mafodotin combination
significantly extending the time to disease progression or death versus the
standard of care combination. A positive OS trend favouring the belantamab
mafodotin combination was also observed at the time of this analysis. The
trial continues to follow up for OS.
Results from DREAMM-8 will be presented at ASCO 2024, and data from both
DREAMM-7 and DREAMM-8 are being shared with health authorities.
The DREAMM (DRiving Excellence in Approaches to Multiple Myeloma) clinical
development programme continues to evaluate the potential of belantamab
mafodotin in early lines of treatment and in combination with novel therapies
and standard of care treatments.
Key phase III trials for Blenrep:
Trial name (population) Phase Design Timeline Status
DREAMM-7 (2L+ multiple myeloma; MM) III A multi-centre, open-label, randomised trial to evaluate the efficacy and Trial start: Active, not recruiting
safety of the combination of belantamab mafodotin, bortezomib, and
dexamethasone (B-Vd) compared with the combination of daratumumab, bortezomib Q2 2020
and dexamethasone (D-Vd) in participants with relapsed/refractory multiple
NCT04246047 myeloma Primary data reported:
Q4 2023
DREAMM-8 (2L+ MM) III A multi-centre, open-label, randomised trial to evaluate the efficacy and Trial start: Primary endpoint met
safety of belantamab mafodotin in combination with pomalidomide and
dexamethasone (B-Pd) versus pomalidomide plus bortezomib and dexamethasone Q4 2020
(P-Vd) in participants with relapsed/refractory multiple myeloma
NCT04484623 Primary data reported:
Q1 2024
Jemperli (dostarlimab)
Jemperli is the foundation of GSK's ongoing immuno-oncology-based research and
development programme. It is currently approved in the US and several other
countries in a subset of adult patients with primary advanced or recurrent
endometrial cancer that is mismatch repair deficient (dMMR), or microsatellite
instability-high (MSI-H). Efforts continue to generate data to support
combination therapies with dostarlimab as the backbone and expand use into a
broader population of patients.
In March 2024, GSK presented statistically significant and clinically
meaningful OS results from Part 1 of the RUBY phase III trial in adult
patients with primary advanced or recurrent endometrial cancer at the Society
of Gynecologic Oncology 2024 Annual Meeting on Women's Cancer (SGO 2024). A
31% reduction in the risk of death and 16.4-month improvement in median OS was
observed with dostarlimab plus chemotherapy versus chemotherapy in the overall
population. Dostarlimab plus chemotherapy is the only immuno-oncology
combination to show statistically significant and clinically meaningful OS in
patients with primary advanced or recurrent endometrial cancer, regardless of
biomarker status.
In April 2024, the US FDA accepted under Priority Review a supplemental
Biologics License Application (sBLA) for Jemperli in combination with
standard-of-care chemotherapy (carboplatin and paclitaxel) for the treatment
of adult patients with primary advanced or recurrent endometrial cancer based
on the RUBY Part 1 data. The Prescription Drug User Fee Act action date is 23
August 2024. Approval of the sBLA would broaden the current indication for
Jemperli plus chemotherapy to all adult patients with primary advanced or
recurrent endometrial cancer, including patients with mismatch repair
proficient (MMRp)/microsatellite stable (MSS) tumours.
GSK also presented PFS results from Part 2 of the RUBY phase III trial in
primary advanced or recurrent endometrial cancer at SGO 2024. In RUBY Part 2,
a 37% reduction in risk of disease progression or death and 6-month
improvement in median PFS was observed with the addition of Zejula (niraparib)
to dostarlimab maintenance following dostarlimab plus chemotherapy versus
chemotherapy in patients with MMRp)/MSS tumours.
In March 2024, GSK began recruiting for its phase III JADE clinical trial
evaluating the safety and effectiveness of dostarlimab in adult participants
with locally advanced unresectable head and neck squamous cell carcinoma.
Key trials for Jemperli:
Trial name (population) Phase Design Timeline Status
RUBY (1L stage III or IV endometrial cancer) III A randomised, double-blind, multi-centre trial of dostarlimab plus Trial start: Active, not recruiting; primary endpoints met
carboplatin-paclitaxel with and without niraparib maintenance versus placebo
plus carboplatin-paclitaxel in patients with recurrent or primary advanced Q3 2019
endometrial cancer
NCT03981796
Part 1 data reported:
Q4 2022
Part 2 data reported:
Q4 2023
PERLA (1L metastatic non-small cell lung cancer) II A randomised, double-blind trial to evaluate the efficacy of dostarlimab plus Trial start: Active, not recruiting; primary endpoint met
chemotherapy versus pembrolizumab plus chemotherapy in metastatic non-squamous
non-small cell lung cancer Q4 2020
NCT04581824
Primary data reported:
Q4 2022
GARNET (advanced solid tumours) I/II A multi-centre, open-label, first-in-human trial evaluating dostarlimab in Trial start: Recruiting
participants with advanced solid tumours who have limited available treatment
options Q1 2016
NCT02715284
Primary data reported:
Q1 2019
AZUR-1 (locally advanced rectal cancer) II A single-arm, open-label trial with dostarlimab monotherapy in participants Trial start: Recruiting
with untreated stage II/III dMMR/MSI-H locally advanced rectal cancer
Q1 2023
NCT05723562
Data anticipated: 2026
AZUR-2 (untreated perioperative T4N0 or stage III colon cancer) III An open-label, randomised trial of perioperative dostarlimab monotherapy Trial start: Recruiting
versus standard of care in participants with untreated T4N0 or stage III
dMMR/MSI-H resectable colon cancer Q2 2023
NCT05855200
Data anticipated: 2026+
COSTAR Lung (advanced non-small cell lung cancer that has progressed on prior II/III A multi-centre, randomised, parallel group treatment, open label trial Trial start: Active, not recruiting
PD-(L)1 therapy and chemotherapy) comparing cobolimab + dostarlimab + docetaxel to dostarlimab + docetaxel to
docetaxel alone in participants with advanced non-small cell lung cancer who Q4 2020
have progressed on prior anti-PD-(L)1 therapy and chemotherapy
NCT04655976
Data anticipated:
2025
JADE (locally advanced unresected head and neck cancer) III A randomised, double-blind, study to evaluate dostarlimab versus placebo as Trial start: Recruiting
sequential therapy after chemoradiation in participants with locally advanced
NCT06256588 unresected head and neck squamous cell carcinoma Q1 2024
Data anticipated: 2026+
Ojjaara/Omjjaara (momelotinib)
Following the September 2023 approval of Ojjaara by the US FDA and its
authorisation as Omjjara by the European Commission and the UK Medicines &
Healthcare products Regulatory Agency (MHRA) in January 2024, GSK continues to
pursue regulatory submissions and approvals in myelofibrosis across the globe,
including a new drug application under review in Japan. With its
differentiated mechanism of action, Ojjaara has the potential to become a
backbone therapy in myelofibrosis, and GSK continues to evaluate its potential
in combinations and other areas of unmet need.
Key phase III trial for momelotinib:
Trial name (population) Phase Design Timeline Status
MOMENTUM (myelofibrosis) III A randomised, double-blind, active control phase III trial intended to confirm Trial start: Complete; primary endpoint met
the differentiated clinical benefits of the investigational drug momelotinib
(MMB) versus danazol (DAN) in symptomatic and anaemic subjects who have Q1 2020
previously received an approved Janus kinase inhibitor (JAKi) therapy for
NCT04173494 myelofibrosis (MF)
Primary data reported:
Q1 2022
Zejula (niraparib)
GSK continues to assess the potential of Zejula across multiple tumour types
and in combination with other agents. The ongoing development programme
includes several combination studies, including the RUBY Part 2 phase III
trial of niraparib and dostarlimab, a programmed death receptor-1
(PD-1)-blocking antibody, in recurrent or primary advanced (stage III or IV)
endometrial cancer, for which positive results were presented at the Society
of Gynecologic Oncology 2024 Annual Meeting on Women's Cancer in March 2024.
Key ongoing phase III trials for Zejula (see also RUBY Part 2 in Jemperli
section):
Trial name (population) Phase Design Timeline Status
ZEAL-1L (1L advanced non-small cell lung cancer maintenance ) III A randomised, double-blind, placebo-controlled, multi-centre trial comparing Trial start: Active, not recruiting
niraparib plus pembrolizumab versus placebo plus pembrolizumab as maintenance
therapy in participants whose disease has remained stable or responded to Q4 2020
first-line platinum-based chemotherapy with pembrolizumab for Stage IIIB/IIIC
NCT04475939 or IV non-small cell lung cancer
Data anticipated:
H2 2024
FIRST (1L ovarian cancer maintenance) III A randomised, double-blind, comparison of platinum-based therapy with Trial start: Active, not recruiting
dostarlimab (TSR-042) and niraparib versus standard of care platinum-based
therapy as first-line treatment of stage III or IV non-mucinous epithelial Q4 2018
ovarian cancer
NCT03602859
Data anticipated:
H2 2024
Reporting definitions
Total and Core results
Total reported results represent the Group's overall performance. GSK uses a
number of non-IFRS, measures to report the performance of its business. Core
results and other non-IFRS measures may be considered in addition to, but not
as a substitute for or superior to, information presented in accordance with
IFRS. Core results are defined on page 18 and other non-IFRS measures are
defined below.
CER and AER growth
In order to illustrate underlying performance, it is the Group's practice to
discuss its results in terms of constant exchange rate (CER) growth. This
represents growth calculated as if the exchange rates used to determine the
results of overseas companies in Sterling had remained unchanged from those
used in the comparative period. CER% represents growth at constant exchange
rates. For those countries which qualify as hyperinflationary as defined by
the criteria set out in IAS 29 'Financial Reporting in Hyperinflationary
Economies' (Argentina and Turkey) CER growth is adjusted using a more
appropriate exchange rate reflecting depreciation of their respective
currencies in order to provide comparability and not to distort CER growth
rates.
£% or AER% represents growth at actual exchange rates.
Free cash flow
Free cash flow is defined as the net cash inflow/outflow from operating
activities less capital expenditure on property, plant and equipment and
intangible assets, contingent consideration payments, net finance costs, and
dividends paid to non-controlling interests, contributions from
non-controlling interests plus proceeds from the sale of property, plant and
equipment and intangible assets, and dividends received from joint ventures
and associates. The measure is used by management as it is considered a good
indicator of net cash generated from business activities (excluding any cash
flows arising from equity investments, business acquisitions or disposals and
changes in the level of borrowing) available to pay shareholders dividends and
to fund strategic plans. Free cash flow growth is calculated on a reported
basis. A reconciliation of net cash inflow from operations to free cash flow
from operations is set out on page 37.
Free cash flow conversion
Free cash flow conversion is free cash flow from operations as a percentage of
profit attributable to shareholders.
Total Net debt
Net debt is defined as total borrowings less cash, cash equivalents, liquid
investments, and short-term loans to third parties that are subject to an
insignificant risk of change in value. The measure is used by management as it
is considered a good indicator of GSK's ability to meet its financial
commitments and the strength of its balance sheet.
COVID-19 solutions
COVID-19 solutions include the sales of pandemic adjuvant and other COVID-19
solutions during the years from 2020-2023 and includes vaccine manufacturing
and Xevudy and the associated costs but does not include reinvestment in
R&D. This categorisation is used by management who believe it is helpful
to investors through providing clarity on the results of the Group by showing
the contribution to growth from COVID-19 solutions during this period.
Turnover excluding COVID-19 solutions
Turnover excluding COVID-19 solutions excludes the impact of sales of pandemic
adjuvant within Vaccines and Xevudy within Specialty Medicines related to the
COVID-19 pandemic during the years 2020-2023. Management believes that the
exclusion of the impact of these COVID-19 solutions sales aids comparability
in the reporting periods and understanding of GSK's growth including by region
versus prior periods and also 2024 Guidance which excludes any contributions
from COVID-19 solutions in current year or comparator periods.
Non-controlling interest
Non-controlling interest is the equity in a subsidiary not attributable,
directly or indirectly, to a parent.
Working capital
Working capital represents inventory and trade receivables less trade
payables.
Total Operating Margin
Total Operating margin is Total operating profit divided by turnover.
Core Operating Margin
Core Operating margin is Core operating profit divided by turnover.
Total Earnings per share
Unless otherwise stated, Total earnings per share refers to Total basic
earnings per share.
RAR (Returns and Rebates)
GSK sells to customers both commercial and government mandated contracts with
reimbursement arrangements that include rebates, chargebacks and a right of
return for certain pharmaceutical products principally in the US. Revenue
recognition reflects gross-to-net sales adjustments as a result. These
adjustments are known as the RAR accruals and are a source of significant
estimation uncertainty and fluctuation which can have a material impact on
reported revenue from one accounting period to the next.
Risk adjusted sales
Pipeline risk-adjusted sales are based on the latest internal estimate of the
probability of technical and regulatory success for each asset in development.
General Medicines
General Medicines are usually prescribed in the primary care or community
settings by general healthcare practitioners. For GSK, this includes medicines
for inhaled respiratory, dermatology, antibiotics and other diseases.
Specialty Medicines
Specialty Medicines are typically prescription medicines used to treat complex
or rare chronic conditions. For GSK, this comprises medicines for infectious
diseases, HIV, Respiratory/Immunology and Other and Oncology.
Percentage points
Percentage points of growth which is abbreviated to ppts.
Brand names and partner acknowledgements: brand names appearing in italics
throughout this document are trademarks of GSK or associated companies or used
under licence by the Group.
Guidance and outlooks, assumptions and cautionary statements
2024 Guidance
GSK expects 2024 sales to increase between 5 to 7 per cent but now towards the
upper part of the range and Core Operating profit to increase between 9 to 11
percent (previously 7 to 10 per cent). Core Earnings per share is expected to
increase between 8 to 10 percent (previously 6 to 9 per cent).
The Group continues to expect high single digit to low double-digit growth for
Vaccines, low double-digit growth for Specialty Medicines and a
mid-single-digit decrease for General Medicines.
This guidance is provided at CER and excludes any contribution from COVID-19
related solutions.
Assumptions and basis of preparation related to 2024 guidance
In outlining the guidance for 2024, the Group has made certain planning
assumptions about the macro-economic environment, the healthcare sector
(including regarding existing and possible additional governmental legislative
and regulatory reform), the different markets and competitive landscape in
which the Group operates and the delivery of revenues and financial benefits
from its current portfolio, its development pipeline and restructuring
programmes.
These planning assumptions as well as operating profit and earnings per share
guidance and dividend expectations assume no material interruptions to supply
of the Group's products, no material mergers, acquisitions or disposals, no
material litigation or investigation costs for the Company (save for those
that are already recognised or for which provisions have been made) and no
change in the Group's shareholdings in ViiV Healthcare. The assumptions also
assume no material changes in the healthcare environment or unexpected
significant changes in pricing as a result of government or competitor action.
The 2024 guidance factors in all divestments and product exits announced to
date.
Notwithstanding our guidance, outlooks and expectations, there is still
uncertainty as to whether our assumptions, guidance, outlooks and expectations
will be achieved.
The guidance is given on a constant currency basis.
Assumptions and cautionary statement regarding forward-looking statements
The Group's management believes that the assumptions outlined above are
reasonable, and that the guidance, outlooks, and expectations described in
this report are achievable based on those assumptions. However, given the
forward-looking nature of these guidance, outlooks, and expectations, they are
subject to greater uncertainty, including potential material impacts if the
above assumptions are not realised, and other material impacts related to
foreign exchange fluctuations, macro-economic activity, the impact of
outbreaks, epidemics or pandemics, changes in legislation, regulation,
government actions or intellectual property protection, product development
and approvals, actions by our competitors, and other risks inherent to the
industries in which we operate.
This document contains statements that are, or may be deemed to be,
"forward-looking statements". Forward-looking statements give the Group's
current expectations or forecasts of future events. An investor can identify
these statements by the fact that they do not relate strictly to historical or
current facts. They use words such as 'anticipate', 'estimate', 'expect',
'intend', 'will', 'project', 'plan', 'believe', 'target' and other words and
terms of similar meaning in connection with any discussion of future operating
or financial performance. In particular, these include statements relating to
future actions, prospective products or product approvals, future performance
or results of current and anticipated products, sales efforts, expenses, the
outcome of contingencies such as legal proceedings, dividend payments and
financial results. Other than in accordance with its legal or regulatory
obligations (including under the Market Abuse Regulation, the UK Listing Rules
and the Disclosure and Transparency Rules of the Financial Conduct Authority),
the Group undertakes no obligation to update any forward-looking statements,
whether as a result of new information, future events or otherwise. The reader
should, however, consult any additional disclosures that the Group may make in
any documents which it publishes and/or files with the SEC. All readers,
wherever located, should take note of these disclosures. Accordingly, no
assurance can be given that any particular expectation will be met and
investors are cautioned not to place undue reliance on the forward-looking
statements.
All guidance, outlooks and expectations should be read together with the
guidance and outlooks, assumptions and cautionary statements in this Q1 2024
earnings release and in the Group's 2023 Annual Report on Form 20-F.
Forward-looking statements are subject to assumptions, inherent risks and
uncertainties, many of which relate to factors that are beyond the Group's
control or precise estimate. The Group cautions investors that a number of
important factors, including those in this document, could cause actual
results to differ materially from those expressed or implied in any
forward-looking statement. Such factors include, but are not limited to, those
discussed under Item 3.D 'Risk Factors' in the Group's Annual Report on Form
20-F for 2023. Any forward-looking statements made by or on behalf of the
Group speak only as of the date they are made and are based upon the knowledge
and information available to the Directors on the date of this report.
Independent review report to GSK plc
Conclusion
We have been engaged by GSK plc ("the Company") to review the condensed
financial information in the Results Announcement of the Company for the three
months ended 31 March 2024.
The condensed financial information comprises:
• the income statement and statement of comprehensive income for the three-month
period ended 31 March 2024 on pages 23 and 24;
• the balance sheet as at 31 March 2024 on page 25;
• the statement of changes in equity for the three-month period then ended on
page 26;
• the cash flow statement for the three-month period then ended on page 27; and
• the accounting policies and basis of preparation and the explanatory notes to
the condensed financial information on pages 28 to 37 that have been prepared
applying consistent accounting policies to those applied by GSK plc and its
subsidiaries ("the Group") in the Annual Report 2023, which was prepared in
accordance with International Financial Reporting Standards ("IFRS") as
adopted by the United Kingdom.
We have read the other information contained in the Results Announcement,
including the non-IFRS measures contained on pages 28 to 37 and considered
whether it contains any apparent misstatements or material inconsistencies
with the information in the condensed financial information.
Based on our review, nothing has come to our attention that causes us to
believe that the condensed financial information in the Results Announcement
for the three months ended 31 March 2024 is not prepared, in all material
respects in accordance with the accounting policies set out in the accounting
policies and basis of preparation section on page 34.
Basis for Conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410 "Review of Interim Financial Information Performed by
the Independent Auditor of the Entity" issued by the Financial Reporting
Council for use in the United Kingdom (ISRE (UK) 2410). A review of interim
financial information consists of making inquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and
other review procedures. A review is substantially less in scope than an audit
conducted in accordance with International Standards on Auditing (UK) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly,
we do not express an audit opinion.
As disclosed on page 34, the annual financial statements of the Company are
prepared in accordance with United Kingdom adopted international accounting
standards. The condensed set of financial information included in this Results
Announcement have been prepared in accordance with the accounting policies set
out in the accounting policies and basis of preparation section on page 34.
Conclusion Relating to Going Concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for Conclusion section of this report,
nothing has come to our attention to suggest that the directors have
inappropriately adopted the going concern basis of accounting or that the
directors have identified material uncertainties relating to going concern
that are not appropriately disclosed.
This Conclusion is based on the review procedures performed in accordance with
ISRE (UK) 2410, however future events or conditions may cause the entity to
cease to continue as a going concern.
Responsibilities of the directors
The directors are responsible for preparing the Results Announcement of the
Company in accordance with the Disclosure Guidance and Transparency Rules of
the United Kingdom's Financial Conduct Authority.
In preparing the Results Announcement, the directors are responsible for
assessing the Company's ability to continue as a going concern, disclosing as
applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the company or
to cease operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the review of the financial information
In reviewing the Results Announcement, our responsibility is to express to the
Company a conclusion on the condensed financial information in the Results
Announcement based on our review. Our Conclusion, including our Conclusions
Relating to Going Concern, are based on procedures that are less extensive
than audit procedures, as described in the Basis of Conclusion paragraph of
this report.
Use of our report
This report is made solely to the Company in accordance with ISRE (UK) 2410.
Our work has been undertaken so that we might state to the Company those
matters we are required to state to it in an independent review report and for
no other purpose. To the fullest extent permitted by law, we do not accept or
assume responsibility to anyone other than the Company, for our review work,
for this report, or for the conclusions we have formed.
Deloitte LLP
Statutory Auditor
London, United Kingdom
1 May 2024
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END QRFBRGDSRDXDGSGRecent news on GSK
See all newsREG - GSK PLC - GSK completes sale of shares in Haleon plc
AnnouncementREG - GSK PLC - GSK announces intention to sell shares in Haleon
AnnouncementREG - GSK PLC - Director/PDMR Shareholding
AnnouncementREG - GSK PLC - Block listing Interim Review
AnnouncementREG - Allianz Global Invs - Top 10 Holdings
Announcement