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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For
the period ending
28th
April 2010
GlaxoSmithKline plc
(Name of registrant)
980 Great West Road,
Brentford,
Middlesex, TW8 9GS
(Address of principal executive offices)
Brentford,
Middlesex, TW8 9GS
(Address of principal executive offices)
Indicate by check mark if the registrant files or will file annual reports under cover Form
20-F or Form 40-F
Form 20-F þ Form 40-F o
Indicate by check mark whether the registrant by furnishing the information contained in this Form
is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934.
Yes o No þ
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| SIGNATURES | ||||||||
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned, thereunto duly authorised.
| Date: April 28th, 2010 |
GlaxoSmithKline plc (Registrant) |
|||
| By: | /s/ Victoria Whyte | |||
| VICTORIA WHYTE | ||||
| Authorised Signatory for and on behalf of GlaxoSmithKline plc | ||||
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 |
||
|
Issued: Wednesday, 28th April 2010, London, U.K. | |
| Results announcement for the first quarter 2010 | ||
| GSK delivers Q1 EPS of 30.7p +16% CER before major restructuring* | ||
• Q1 sales £7.4bn up
13% CER |
||
• Underlying sales (excluding pandemic
products) up 4% CER |
Results before major restructuring*
| Q1 2010 | Growth | |||||||||||
| £m | CER% | £% | ||||||||||
Turnover |
7,357 | 13 | 9 | |||||||||
Earnings per share |
30.7 | p | 16 | 17 | ||||||||
Total results
| Q1 2010 | Growth | |||||||||||
| £m | CER% | £% | ||||||||||
Turnover |
7,357 | 13 | 9 | |||||||||
Restructuring charges |
301 | |||||||||||
Earnings per share |
26.4 | p | 18 | 18 | ||||||||
The full results are presented under ‘Income Statement’ on page 8.
| * | For explanations of the measures ‘results before major restructuring’ and ‘CER growth’, see page 7. |
Summary
| • | Good strategic progress delivers continued sales growth: Q1 sales £7.4bn up 13% |
| • | Pharmaceutical sales +14% to £6.1bn: Emerging Markets (+43%), Asia Pacific/Japan (+45%), Europe (+16%), USA (-1%), ViiV Healthcare (-7%) | ||
| • | Consumer Healthcare sales +9% to £1.2bn, with market share gains across all categories (OTC, oral care, nutritionals) | ||
| • | Sales from ‘white pills/western markets’: 27% of Q1 sales (32% in Q1 2009) |
| • | Sustained new product momentum and pipeline delivery |
| • | Sales of new products totalled £412m +65% (£1.1bn including pandemic products) | ||
| • | EU approvals: Revolade, Arzerra and Duodart. EU positive opinion: Votrient | ||
| • | Planned Q2 filings for Benlysta in USA and EU | ||
| • | Phase III start for Relovair in asthma |
| • | Operational Excellence programme on track to deliver £2.2bn of cumulative annual cost savings by 2012, with £1.5bn expected by end of 2010 | |
| • | Net cash inflow from operating activities £2.1bn up 22% in sterling terms | |
| • | Progressive dividend policy continues with Q1 dividend of 15p (+7%). |
1
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GSK’s strategic priorities
GSK has focused its business around the delivery
of three strategic priorities, which aim to increase
growth, reduce risk and improve GSK’s long-term
financial performance:
| • | Grow a diversified global business | |
| • | Deliver more products of value | |
| • | Simplify GSK’s operating model |
Chief Executive Officer’s Review
With continued sales growth in the first quarter, I believe GSK is
demonstrating sustained business performance and that we are making good
progress in delivering our strategy.
Our sales growth is multi-sourced with good performances in our Pharmaceuticals
business, driven by vaccines, respiratory and dermatology products and in our
Consumer Healthcare business. In all of these areas, sales were especially
dynamic across emerging markets where we continue to gain market share.
Group turnover grew 13% aided by sales of pandemic influenza products (pandemic
vaccine and Relenza). Excluding these products, underlying sales grew 4% to
£6.6 billion. Sales from ‘white pills/western markets’ for the first quarter
were approximately 27% (excluding sales of pandemic vaccine). This compares to
32% of sales in Q1 2009, a significant reduction and a reflection of the
growing diversification of our business.
Established products such as Seretide/Advair and newer products, such as
Cervarix, Synflorix and Tykerb helped to drive this good underlying
performance. Total new product sales were over £400m (+65%) and including
pandemic products were more than £1 billion.
Brand innovation, global expansion and continued investment in marketing, is
also driving growth of our Consumer Healthcare business. This quarter sales
grew 9%, significantly faster than estimated global market growth of 1%. Total
sales were £1.2 billion, with brand innovations launched in the last 3 years
representing approximately 14% of sales. All these strategies are helping to
drive continued market share gains across all the business segments in which we
operate.
Proactive succession planning in our key business areas is very important and
in the last few months, we have made new appointments to maintain excellent
leadership in both Vaccines and Consumer Healthcare over the longer-term.
This first quarter also saw some early signs of recovery for our US
pharmaceuticals business, with sales down 1% (Q1 2009: -24%), as the balance
within our portfolio between genericisation and new products begins to move in
our favour.
We welcome the passage of healthcare reform in the USA this quarter, which will
bring essential healthcare to millions of previously uninsured Americans and,
for the industry, will provide greater certainty and stability. Clearly, the
reform results in increased discounts for medicines particularly related to
government programmes like Medicaid. In the first quarter we have been able to
absorb this adverse financial impact and we expect to offset any further impact
through continued operational performance. The transformation we have already
instigated within our US business has been focused on ensuring that we are fit
to compete in the environment created by this reform.
| Issued: Wednesday, 28th April 2010, London, U.K. | 2 |
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We also continue to re-shape the company through simplification and cost
containment initiatives, which are on track to deliver annual cumulative cost
savings of £2.2 billion by 2012 of which £1.5 billion is expected to be
achieved by the end of this year. In addition, I am pleased with the progress
we are making with the integration of Stiefel and we remain on track to deliver
up to £155 million of savings from this programme by 2012.
This focus on cost control is guided by our strategy to improve returns on
invested capital and is enabling us to invest effectively in growth
markets. As a result, we still expect to deliver
a broadly stable operating margin, before legal charges, for 2010.
Legal charges for this quarter increased versus the same quarter last year.
This increase is a direct consequence of the progress we are making towards
settlement of a number of existing cases.
Over these last few months, many companies have seen further public debate
concerning drug safety and industry integrity. For GSK, this has related
particularly to our diabetes medicine, Avandia. For us patient safety is an
absolute priority and we continue to believe that the allegations made by some
of our critics that we acted improperly around this medicine are unfounded.
This debate is indicative of the pressures and challenges that our industry
must face and reinforces the need for continued openness and transparency — an
agenda GSK has strongly pursued since I took over as CEO. There is no question
of us letting up on this as it is in the interest of patients and our business.
In conclusion, GSK has made a good start to 2010 and this provides further
confirmation that our strategy is working. We have increased the dividend for
the quarter to 15p and remain confident of our prospects for the year.
Andrew Witty
Chief Executive Officer
Chief Executive Officer
To hear more from Andrew on GSK’s Q1 Results, please visit: www.gsk.com
| Issued: Wednesday, 28th April 2010, London, U.K. | 3 |
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Trading update
Turnover and key product movements impacting growth for the quarter
Total Group turnover rose 13% to £7.4 billion, with pharmaceutical sales up 14%
and Consumer Healthcare sales up 9%. Underlying sales performance in the quarter —
excluding the benefit from significant sales of pandemic related products including
H1N1 vaccine and Relenza — was also positive at 4%.
On a regional basis, a slight decline in US pharmaceutical sales (-1% to £1.9
billion) due to the continued impact of generic competition to several mature
products, was offset by strong growth in all other regions: Europe (+16% to £1.9
billion), Emerging Markets (+43% to £866 million) and Asia Pacific/Japan (+45% to
£885 million).
Sales of Seretide/Advair rose 9% to £1.3 billion, with strong growth in Europe (+10%
to £423 million), Emerging Markets (+28% to £80 million) and Japan (+35% to £46
million). US Advair sales rose 4% to £630 million. Flovent sales (+5% to £196
million) benefited from the re-initiation of promotion in the USA where sales rose 8%
to £99 million. Avamys/Veramyst sales increased 52% to £46 million, with strong
growth in Europe more than offsetting a slight decline in the USA.
Total vaccine sales were £1.4 billion, including £698 million of H1N1 vaccine sales.
Sales of Synflorix, which was launched in 2009, were £45 million, while Cervarix
sales grew 60% to £77 million. Hepatitis vaccines also grew strongly (+38% to £197
million) benefiting from supply shortages of competitor products in the US market.
Rotarix sales (+19% to
£65 million) were not significantly impacted in the quarter by the FDA’s decision in
late March to suspend temporarily the product in the USA as a precautionary measure
following the discovery of PCV-1 DNA material in the vaccine. An FDA advisory
committee meeting to review this matter is scheduled for 7th May.
Dermatology sales, including heritage GSK products and those acquired through the
acquisition of Stiefel in July 2009, totalled £265 million in the quarter (8% growth
on a proforma basis). In addition, GSK’s heritage consumer dermatology portfolio,
reported within Consumer Healthcare, contributed sales of £62 million (+10%).
Other strong pharmaceutical performances in the quarter included Tykerb (+62% to
£53 million), Avodart (+20% to £139 million), Lovaza (+9% to £107 million) and Arixtra
(+25% to £70 million).
Sales of Valtrex declined 46% to £176 million, primarily as a result of generic
competition to the product in the USA (-55% to £107 million) which began in November
2009. Sales of Wellbutrin fell 67% to £20 million, reflecting the sale of Wellbutrin
XL in the USA to Biovail in Q2 2009. European sales of Wellbutrin rose 50% to £9
million. The decline in Boniva sales
(-63% to £23 million) reflects the transfer on 1st January to Genentech of exclusive
promotion of the product in the USA. GSK now records income from Genentech related
to the product in Other operating income.
ViiV Healthcare, the new speciality HIV company established by GSK and Pfizer was
launched in November 2009. HIV product sales were £373 million, down 7% on Q1 2009,
in part reflecting the impact of US healthcare reforms. In addition the impact of
competition to established products such as Combivir (-23% to £82 million) was not
fully offset by the inclusion of Selzentry and Viracept.
Total Consumer Healthcare sales rose 9% (to £1.2 billion), significantly ahead of
estimated market growth of approximately 1%, with growth in all regions: North
America (+3%), Europe (+9%), and Rest of World (+13%) and in all categories: OTC
products (+11% to £617 million), Oral care (+5% to £381 million) and Nutritionals
(+12% to £233 million).
| Issued: Wednesday, 28th April 2010, London, U.K. | 4 |
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Within OTC, launches of the new Niquitin/Nicorette Mini lozenge helped grow
the smoking control franchise (+16% to £92 million). The launch of the Mini in the
USA began at the end of March 2010. Sales of alli more than doubled to £63 million,
benefiting significantly from the launch of the product in Europe which began at the
end of March 2009. The Panadol franchise also grew strongly (+14% to £117 million),
helped by the acquisition of Alvedon in 2009. Sales of respiratory tract products
declined 8% to £94 million, in part due to a relatively weak flu season.
Within Oral care, Sensodyne franchise sales continued to grow strongly (+21% to £133
million), offsetting a decline in Poligrip sales (-29% to £15 million) following the
company’s decision in February to end production of the zinc-containing product and
to move to zinc-free alternatives. Zinc-free alternatives are expected to be fully
available in all major markets by May 2010.
Nutritionals performance was driven by sales growth of all major products including
Horlicks (+17% to £87 million), Lucozade (+5% to £82 million) and Ribena (+11% to £42
million).
Operating profit and earnings per share commentary
Results before major restructuring
Operating profit before major restructuring for Q1 2010 was £2,395 million, a 21%
growth in CER terms.
Cost of sales increased to 26.2% of turnover (Q1 2009: 24.3%), reflecting the
impact of generic competition to higher margin products in the USA, principally
Valtrex, changes in business and product mix and £94 million of stock write-offs
in the quarter. The company continues to expect cost of sales as a percentage of
turnover to be around 26% for the full year.
SG&A costs as a percentage of turnover were 31.2%, broadly in line with the prior
year. Legal costs of £210 million in the quarter reflected progress being made
towards settlement of a number of existing cases. Excluding legal charges, SG&A
costs were 28.3% of turnover and the company continues to expect SG&A costs
excluding legal charges to be around 29% of turnover for the full year.
R&D expenditure decreased to 12.8% of turnover (Q1 2009: 15.9%), reflecting the
phasing of project expenditure, good progress on efficiency savings and a positive
comparison to the prior year which included significant intangible asset write-off
costs. The company continues to expect R&D costs as a percentage of turnover to
be around 14% for the full year.
Other operating income was £199 million in the quarter, including royalty income of
£80 million (Q1 2009: £67 million). Other operating income also included a
receipt relating to the transfer on 1st January 2010 to Genentech of exclusive
promotion rights to Boniva in the USA. No further receipts from Genentech related
to this transaction are expected this year.
Overall, the company continues to expect the operating profit margin in 2010 to be
broadly similar to 2009 (excluding legal costs and the 2009 ViiV Healthcare
one-time gain).
The charge for taxation on profit before major restructuring amounted to £618
million and represents an effective tax rate of 27.7% (Q1 2009: 29.0%). The
effective tax rate for the full year is expected to be around 28%.
EPS before major restructuring of 30.7p increased 16% in CER terms (a 17% increase
in sterling terms) compared with Q1 2009. A negative impact of 5% from currency
movements was offset by exchange gains on the settlement of intercompany
transactions in the quarter.
| Issued: Wednesday, 28th April 2010, London, U.K. | 5 |
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Total results after restructuring
Operating profit after restructuring for Q1 2010 was £2,094 million, up 22% in
both CER and sterling terms. This included £301 million of
charges related to restructuring (Q1 2009: £264
million); £28 million was charged to cost of sales
(Q1 2009: £143 million), £52 million to SG&A (Q1 2009: £71 million) and £221
million to R&D (Q1 2009: £50 million).
EPS after restructuring of 26.4p increased 18% in both CER and sterling terms
compared with Q1 2009.
Cash flow and net debt
Net cash inflow from operating activities for Q1 2010 was £2,122 million,
up 22% in sterling terms. This was used to fund net interest of £21 million,
capital expenditure on property, plant and equipment and intangible assets of
£326 million, repayment of short-term loans of
£625 million and the dividend paid to shareholders of £763 million.
Net debt decreased by £0.4 billion during the period to £9.0 billion at 31st
March 2010, comprising gross debt of £16.2 billion and cash, cash equivalents
and liquid investments of £7.2 billion. At 31st March 2010, GSK had short-term
borrowings (including overdrafts) repayable within 12 months of only £1 billion
with no further borrowings repayable in the subsequent year.
Dividends
The Board has declared a first interim dividend of 15 pence per share (Q1
2009: 14 pence). The equivalent interim dividend receivable by ADR holders is
46.0320 cents per ADS based on an exchange rate of £1/$1.5344. The ex-dividend
date will be 5th May 2010, with a record date of 7th May 2010 and a payment
date of 8th July 2010.
Currency impact
The Q1 results are based on average exchange rates, principally £1/$1.56,
£1/€1.13 and £1/Yen 143. Comparative exchange rates are given on page 20. The
period end exchange rates were £1/$1.52, £1/€1.12 and £1/Yen 142. If exchange
rates were to hold at these period end levels for the rest of 2010 and there
were no exchange gains or losses in subsequent quarters, the estimated positive
impact on 2010 sterling EPS growth before major restructuring would be
approximately 5 percentage points.
Additional P&L information
To improve transparency and understanding of our increasingly diversified
business additional detailed financial information is provided for the first
time on pages 22 to 23.
| Issued: Wednesday, 28th April 2010, London, U.K. | 6 |
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GlaxoSmithKline (GSK) together with its subsidiary undertakings, the
‘Group’ — one of the world’s leading research-based pharmaceutical and
healthcare companies — is committed to improving the quality of human life by
enabling people to do more, feel better and live longer. GlaxoSmithKline’s
website www.gsk.com gives additional information on the Group. Information made
available on the website does not constitute part of this document.
Enquiries:
|
UK Media | Philip Thomson | (020) 8047 5502 | |||
| Claire Brough | (020) 8047 5502 | |||||
| Alexandra Harrison | (020) 8047 5502 | |||||
| Stephen Rea | (020) 8047 5502 | |||||
| Jo Revill | (020) 8047 5502 | |||||
| US Media | Nancy Pekarek | (919) 483 2839 | ||||
| Mary Anne Rhyne | (919) 483 2839 | |||||
| Kevin Colgan | (919) 483 2839 | |||||
| Sarah Alspach | (919) 483 2839 | |||||
| European Analyst / Investor | David Mawdsley | (020) 8047 5564 | ||||
| Sally Ferguson | (020) 8047 5543 | |||||
| Gary Davies | (020) 8047 5503 | |||||
| US Analyst / Investor | Tom Curry | (215) 751 5419 | ||||
| Jen Hill Baxter | (215) 751 7002 |
Results before major restructuring
Results before major restructuring is a measure used by management to assess
the Group’s financial performance and is presented after excluding
restructuring charges relating to the Operational Excellence programme, which
commenced in October 2007 and the acquisitions of Reliant Pharmaceuticals in
December 2007 and Stiefel in July 2009. Management believes that this
presentation assists shareholders in gaining a clearer understanding of the
Group’s financial performance and in making projections of future financial
performance, as results that include such costs, by virtue of their size and
nature, have limited comparative value.
CER 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. All commentaries are presented in terms of CER
growth, unless otherwise stated.
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.
Cautionary statement regarding forward-looking statements
Under the safe harbor provisions of the US Private Securities Litigation Reform Act
of 1995, the company cautions investors that any forward-looking statements or
projections made by the company, including those made in this Announcement, are
subject to risks and uncertainties that may cause actual results to differ materially
from those projected. Factors that may affect the Group’s operations are described
under ‘Risk Factors’ in the ‘Business Review’ in the company’s Annual Report on Form
20-F for 2009.
GlaxoSmithKline plc, 980 Great West Road, Brentford, Middlesex TW8 9GS, United Kingdom
Registered in England and Wales. Registered number: 3888792
| Issued: Wednesday, 28th April 2010, London, U.K. | 7 |
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Income statement
Three months ended 31st March 2010
| Results | Results | |||||||||||||||||||||||||||
| before major | Major | before major | Major | |||||||||||||||||||||||||
| restructuring | restructuring | Total | restructuring | restructuring | Total | |||||||||||||||||||||||
| Q1 2010 | Growth | Q1 2010 | Q1 2010 | Q1 2009 | Q1 2009 | Q1 2009 | ||||||||||||||||||||||
| £m | CER% | £m | £m | £m | £m | £m | ||||||||||||||||||||||
TURNOVER |
7,357 | 13 | 7,357 | 6,769 | 6,769 | |||||||||||||||||||||||
Cost of sales |
(1,924 | ) | 19 | (28 | ) | (1,952 | ) | (1,644 | ) | (143 | ) | (1,787 | ) | |||||||||||||||
Gross profit |
5,433 | 11 | (28 | ) | 5,405 | 5,125 | (143 | ) | 4,982 | |||||||||||||||||||
Selling, general and
administration |
(2,298 | ) | 18 | (52 | ) | (2,350 | ) | (2,129 | ) | (71 | ) | (2,200 | ) | |||||||||||||||
Research and development |
(939 | ) | (9 | ) | (221 | ) | (1,160 | ) | (1,074 | ) | (50 | ) | (1,124 | ) | ||||||||||||||
Other operating income |
199 | 199 | 54 | 54 | ||||||||||||||||||||||||
OPERATING PROFIT |
2,395 | 21 | (301 | ) | 2,094 | 1,976 | (264 | ) | 1,712 | |||||||||||||||||||
Finance income |
17 | 17 | 28 | 28 | ||||||||||||||||||||||||
Finance expense |
(204 | ) | (1 | ) | (205 | ) | (202 | ) | (1 | ) | (203 | ) | ||||||||||||||||
Profit on disposal of interest
in associate |
— | — | 115 | 115 | ||||||||||||||||||||||||
Share of after tax profits of
associates and joint
ventures |
25 | 25 | 14 | 14 | ||||||||||||||||||||||||
PROFIT BEFORE TAXATION |
2,233 | 16 | (302 | ) | 1,931 | 1,931 | (265 | ) | 1,666 | |||||||||||||||||||
Taxation |
(618 | ) | 82 | (536 | ) | (560 | ) | 63 | (497 | ) | ||||||||||||||||||
Tax rate % |
27.7 | % | 27.8 | % | 29.0 | % | 29.8 | % | ||||||||||||||||||||
PROFIT AFTER TAXATION FOR
THE PERIOD |
1,615 | 18 | (220 | ) | 1,395 | 1,371 | (202 | ) | 1,169 | |||||||||||||||||||
Profit attributable to
non-controlling interests |
55 | 55 | 38 | 38 | ||||||||||||||||||||||||
Profit attributable to
shareholders |
1,560 | (220 | ) | 1,340 | 1,333 | (202 | ) | 1,131 | ||||||||||||||||||||
| 1,615 | (220 | ) | 1,395 | 1,371 | (202 | ) | 1,169 | |||||||||||||||||||||
EARNINGS PER SHARE |
30.7 | p | 16 | 26.4 | p | 26.3 | p | 22.3 | p | |||||||||||||||||||
Diluted earnings per share |
30.4 | p | 26.1 | p | 26.2 | p | 22.2 | p | ||||||||||||||||||||
| Issued: Wednesday, 28th April 2010, London, U.K. | 8 |
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Pharmaceuticals turnover
Three months ended 31st March 2010
Three months ended 31st March 2010
| Total | USA | Europe | Rest of World | |||||||||||||||||||||||||||||
| £m | CER% | £m | CER% | £m | CER% | £m | CER% | |||||||||||||||||||||||||
Respiratory |
1,766 | 6 | 805 | 3 | 569 | 6 | 392 | 13 | ||||||||||||||||||||||||
Avamys/Veramyst |
46 | 52 | 17 | (10 | ) | 13 | 56 | 16 | >100 | |||||||||||||||||||||||
Flixonase/Flonase |
45 | (30 | ) | 6 | (40 | ) | 10 | (17 | ) | 29 | (32 | ) | ||||||||||||||||||||
Flixotide/Flovent |
196 | 5 | 99 | 8 | 45 | (6 | ) | 52 | 8 | |||||||||||||||||||||||
Seretide/Advair |
1,264 | 9 | 630 | 4 | 423 | 10 | 211 | 25 | ||||||||||||||||||||||||
Serevent |
51 | (16 | ) | 16 | (11 | ) | 26 | (16 | ) | 9 | (25 | ) | ||||||||||||||||||||
Ventolin |
116 | 3 | 35 | — | 37 | — | 44 | 7 | ||||||||||||||||||||||||
Zyrtec |
20 | 17 | — | — | — | — | 20 | 17 | ||||||||||||||||||||||||
Anti-virals |
358 | (44 | ) | 154 | (42 | ) | 35 | (78 | ) | 169 | (20 | ) | ||||||||||||||||||||
Relenza |
84 | (60 | ) | 30 | >100 | 2 | (97 | ) | 52 | (49 | ) | |||||||||||||||||||||
Valtrex |
176 | (46 | ) | 107 | (55 | ) | 23 | (43 | ) | 46 | — | |||||||||||||||||||||
Zeffix |
52 | 4 | 3 | — | 7 | — | 42 | 5 | ||||||||||||||||||||||||
Central nervous system |
417 | (13 | ) | 136 | (32 | ) | 140 | (2 | ) | 141 | 7 | |||||||||||||||||||||
Imigran/Imitrex |
57 | (9 | ) | 24 | (11 | ) | 22 | (12 | ) | 11 | — | |||||||||||||||||||||
Lamictal |
120 | (11 | ) | 61 | (23 | ) | 37 | (3 | ) | 22 | 26 | |||||||||||||||||||||
Requip |
55 | 14 | 10 | 38 | 36 | 13 | 9 | — | ||||||||||||||||||||||||
Seroxat/Paxil |
106 | (12 | ) | 10 | (29 | ) | 22 | (21 | ) | 74 | (6 | ) | ||||||||||||||||||||
Treximet |
13 | 7 | 13 | 7 | — | — | — | — | ||||||||||||||||||||||||
Wellbutrin |
20 | (67 | ) | 8 | (85 | ) | 9 | 50 | 3 | — | ||||||||||||||||||||||
Cardiovascular and urogenital |
570 | 9 | 337 | 6 | 153 | 11 | 80 | 23 | ||||||||||||||||||||||||
Arixtra |
70 | 25 | 39 | 27 | 26 | 23 | 5 | 25 | ||||||||||||||||||||||||
Avodart |
139 | 20 | 76 | 12 | 40 | 17 | 23 | 77 | ||||||||||||||||||||||||
Coreg |
42 | (12 | ) | 42 | (12 | ) | — | — | — | — | ||||||||||||||||||||||
Fraxiparine |
56 | 4 | — | — | 43 | — | 13 | 17 | ||||||||||||||||||||||||
Lovaza |
107 | 9 | 107 | 10 | — | — | — | — | ||||||||||||||||||||||||
Vesicare |
25 | 13 | 25 | 13 | — | — | — | — | ||||||||||||||||||||||||
Volibris |
9 | >100 | — | — | 8 | >100 | 1 | — | ||||||||||||||||||||||||
Metabolic |
230 | (18 | ) | 89 | (36 | ) | 61 | (7 | ) | 80 | 7 | |||||||||||||||||||||
Avandia products |
169 | (10 | ) | 89 | (14 | ) | 38 | (12 | ) | 42 | 2 | |||||||||||||||||||||
Bonviva/Boniva |
23 | (63 | ) | — | — | 20 | (5 | ) | 3 | — | ||||||||||||||||||||||
Anti-bacterials |
356 | (6 | ) | 24 | (10 | ) | 142 | (21 | ) | 190 | 10 | |||||||||||||||||||||
Augmentin |
160 | (10 | ) | 8 | (44 | ) | 63 | (23 | ) | 89 | 9 | |||||||||||||||||||||
Oncology and emesis |
169 | 23 | 92 | 41 | 50 | — | 27 | 17 | ||||||||||||||||||||||||
Arzerra |
5 | — | 5 | — | — | — | — | — | ||||||||||||||||||||||||
Hycamtin |
40 | — | 24 | — | 13 | (7 | ) | 3 | 50 | |||||||||||||||||||||||
Promacta |
6 | >100 | 6 | >100 | — | — | — | — | ||||||||||||||||||||||||
Tyverb/Tykerb |
53 | 62 | 17 | 73 | 24 | 41 | 12 | 100 | ||||||||||||||||||||||||
Votrient |
5 | — | 5 | — | — | — | — | — | ||||||||||||||||||||||||
Vaccines |
1,411 | >100 | 171 | 55 | 613 | >100 | 627 | >100 | ||||||||||||||||||||||||
Boostrix |
30 | 19 | 15 | 55 | 9 | 25 | 6 | (43 | ) | |||||||||||||||||||||||
Cervarix |
77 | 60 | 2 | — | 59 | 51 | 16 | 78 | ||||||||||||||||||||||||
Fluarix, FluLaval |
5 | (43 | ) | 1 | — | — | — | 4 | (50 | ) | ||||||||||||||||||||||
Flu Pandemic |
698 | >100 | — | — | 304 | >100 | 394 | >100 | ||||||||||||||||||||||||
Hepatitis |
197 | 38 | 92 | 92 | 61 | 2 | 44 | 19 | ||||||||||||||||||||||||
Infanrix, Pediarix |
166 | (3 | ) | 32 | (13 | ) | 104 | (2 | ) | 30 | 4 | |||||||||||||||||||||
Rotarix |
65 | 19 | 27 | 93 | 13 | 8 | 25 | (14 | ) | |||||||||||||||||||||||
Synflorix |
45 | — | — | — | 12 | — | 33 | — | ||||||||||||||||||||||||
Dermatologicals |
265 | >100 | 97 | 100 | 62 | >100 | 106 | 83 | ||||||||||||||||||||||||
Bactroban |
27 | (7 | ) | 11 | (20 | ) | 6 | — | 10 | 11 | ||||||||||||||||||||||
Dermovate |
15 | — | — | — | 4 | — | 11 | — | ||||||||||||||||||||||||
Duac |
27 | — | 17 | — | 6 | — | 4 | — | ||||||||||||||||||||||||
Soriatane |
18 | — | 18 | — | — | — | — | — | ||||||||||||||||||||||||
Zovirax |
49 | 61 | 26 | >100 | 7 | (13 | ) | 16 | (11 | ) | ||||||||||||||||||||||
Other |
211 | 20 | 4 | (20 | ) | 68 | 24 | 139 | 20 | |||||||||||||||||||||||
| 5,753 | 15 | 1,909 | (1 | ) | 1,893 | 16 | 1,951 | 39 | ||||||||||||||||||||||||
ViiV Healthcare (HIV) |
373 | (7 | ) | 159 | (11 | ) | 159 | (3 | ) | 55 | (4 | ) | ||||||||||||||||||||
Combivir |
82 | (23 | ) | 34 | (30 | ) | 33 | (17 | ) | 15 | (17 | ) | ||||||||||||||||||||
Epivir |
28 | (15 | ) | 10 | (15 | ) | 10 | (21 | ) | 8 | — | |||||||||||||||||||||
Epzicom/Kivexa |
131 | (1 | ) | 48 | (10 | ) | 64 | 6 | 19 | 6 | ||||||||||||||||||||||
Lexiva |
41 | (8 | ) | 21 | (15 | ) | 15 | (12 | ) | 5 | 50 | |||||||||||||||||||||
Selzentry |
19 | — | 8 | — | 11 | — | — | — | ||||||||||||||||||||||||
Trizivir |
38 | (27 | ) | 19 | (33 | ) | 17 | (29 | ) | 2 | 100 | |||||||||||||||||||||
| 6,126 | 14 | |||||||||||||||||||||||||||||||
Pharmaceutical turnover includes co-promotion income.
| Issued: Wednesday, 28th April 2010, London, U.K. | 9 |
Table of Contents
Consumer Healthcare turnover
Three months ended 31st March 2010
| Total | USA | Europe | Rest of World | |||||||||||||||||||||||||||||
| £m | CER% | £m | CER% | £m | CER% | £m | CER% | |||||||||||||||||||||||||
Over-the-counter medicines |
617 | 11 | 169 | 2 | 190 | 21 | 258 | 11 | ||||||||||||||||||||||||
alli |
63 | >100 | 28 | 7 | 34 | >100 | 1 | — | ||||||||||||||||||||||||
Breathe Right |
21 | (19 | ) | 11 | (21 | ) | 5 | (14 | ) | 5 | (17 | ) | ||||||||||||||||||||
Cold sore franchise |
25 | 9 | 10 | 22 | 12 | 9 | 3 | (33 | ) | |||||||||||||||||||||||
Nicotene replacement therapy |
92 | 16 | 62 | 16 | 19 | 12 | 11 | 29 | ||||||||||||||||||||||||
Panadol |
117 | 14 | — | — | 27 | 30 | 90 | 10 | ||||||||||||||||||||||||
Tums |
26 | (7 | ) | 22 | (11 | ) | — | — | 4 | 33 | ||||||||||||||||||||||
Oral healthcare |
381 | 5 | 77 | 6 | 179 | (1 | ) | 125 | 16 | |||||||||||||||||||||||
Aquafresh franchise |
123 | (3 | ) | 25 | — | 67 | (8 | ) | 31 | 7 | ||||||||||||||||||||||
Biotene |
7 | 17 | 5 | — | 1 | — | 1 | — | ||||||||||||||||||||||||
Denture care |
76 | (3 | ) | 16 | (11 | ) | 24 | (11 | ) | 36 | 9 | |||||||||||||||||||||
Sensodyne franchise |
133 | 21 | 30 | 23 | 50 | 9 | 53 | 33 | ||||||||||||||||||||||||
Nutritional healthcare |
233 | 12 | — | — | 102 | 7 | 131 | 16 | ||||||||||||||||||||||||
Horlicks |
87 | 17 | — | — | 6 | 20 | 81 | 17 | ||||||||||||||||||||||||
Lucozade |
82 | 5 | — | — | 67 | 3 | 15 | 13 | ||||||||||||||||||||||||
Ribena |
42 | 11 | — | — | 29 | 16 | 13 | — | ||||||||||||||||||||||||
| 1,231 | 9 | 246 | 3 | 471 | 9 | 514 | 13 | |||||||||||||||||||||||||
Statement of comprehensive income
| Q1 2010 | Q1 2009 | |||||||
| £m | £m | |||||||
Profit for the period |
1,395 | 1,169 | ||||||
Exchange movements on overseas net assets and net investment hedges |
203 | (214 | ) | |||||
Fair value movements on available-for-sale investments |
24 | 21 | ||||||
Deferred tax on fair value movements on available-for-sale investments |
1 | (1 | ) | |||||
Reclassification of fair value movements on available-for-sale investments |
(13 | ) | (4 | ) | ||||
Actuarial losses on defined benefit plans |
(165 | ) | (135 | ) | ||||
Deferred tax on actuarial movements in defined benefit plans |
53 | 37 | ||||||
Fair value movements on cash flow hedges |
— | (3 | ) | |||||
Other comprehensive income/(expense) for the period |
103 | (299 | ) | |||||
Total comprehensive income for the period |
1,498 | 870 | ||||||
Total comprehensive income for the period attributable to: |
||||||||
Shareholders |
1,413 | 844 | ||||||
Non-controlling interests |
85 | 26 | ||||||
| 1,498 | 870 | |||||||
| Issued: Wednesday, 28th April 2010, London, U.K. | 10 |
Table of Contents
GSK’s late-stage pharmaceuticals and vaccines pipeline
The table below is provided as part of GSK’s quarterly update to show events and changes to the late stage pipeline
during the quarter and up to the date of announcement.
The following assets were listed as approved or terminated in the last quarterly update and are no longer included in the
table: Cervarix, Tykerb IBC
| Biopharmaceuticals | USA | EU | News update in the quarter | |||||
Arzerra (ofatumumab) |
CLL | Approved | Approved Apr 2010 |
Approved in the EU on 19th April 2010. | ||||
| NHL (FL) | Ph III | Ph III | ||||||
| NHL (DLBCL) | Ph III | Ph III | ||||||
| RA | Ph III | Ph III | ||||||
Benlysta (belimumab) |
Systemic lupus | Ph III | Ph III | Announced headline BLISS 76 76 week data on 20th April 2010. Expect to file in Q2 2010. | ||||
otelixizumab
|
Type 1 diabetes | Ph III | Ph III | |||||
Syncria
|
Type 2 diabetes | Ph III | Ph III | |||||
Prolia (denosumab)
|
Post menopausal osteoporosis |
n/a | Filed | |||||
| Cardiovascular & Metabolic | USA | EU | News update in the quarter | |||||
Arixtra
|
Acute coronary syndrome | Filed | Approved | |||||
Avandamet XR
|
Type 2 diabetes | Ph III | Ph III | Filing strategy under review. | ||||
Avandia + statin
|
Type 2 diabetes | Ph III | Ph III | Filing strategy under review. | ||||
darapladib
|
Atherosclerosis | Ph III | Ph III | |||||
| Neurosciences | USA | EU | News update in the quarter | |||||
Horizant
|
RLS | Filed | Ph III | Complete Response letter received 17th February 2010. | ||||
almorexant
|
Primary insomnia | Ph III | Ph III | |||||
retigabine
|
Epilepsy | Filed | Filed | |||||
| Oncology | USA | EU | News update in the quarter | |||||
Promacta/Revolade
|
Chronic ITP | Approved | Approved Mar 2010 |
Approved in the EU on 11th March 2010. | ||||
| Hepatitis C | Ph III | Ph III | Recruitment complete. | |||||
| CLD | Ph III | Ph III | Chronic liver disease study closed and data presented at EASL 17th April 2010. Next steps under review. | |||||
Avodart
|
Prostate cancer prevention | Refiled Mar 2010 |
Filed | Refiled in USA on 29th March 2010. | ||||
| Duodart/Flodart (fixed dose combination with tamsulosin) |
Tentative approval Jan 2010 |
Approved Mar 2010 |
Approved in Switzerland on 22nd March 2010 and in EU via Decentralised Procedure on 31st March 2010. | |||||
| Issued: Wednesday, 28th April 2010, London, U.K. | 11 |
Table of Contents
| Oncology / contd. | USA | EU | News update in the quarter | |||||
Votrient (pazopanib) |
Renal cell cancer | Approved | Filed | CHMP positive opinion 19th February 2010. Enrolment complete in Sutent head-to-head study | ||||
| Sarcoma | Ph III | Ph III | Recruitment complete. | |||||
| Ovarian | Ph III | Ph III | ||||||
Tykerb
|
First-line metastatic | Approved Jan 2010 |
Filed | CHMP positive opinion 19th February 2010. | ||||
| Adjuvant breast cancer | Ph III | Ph III | ||||||
| Head & neck cancer | Ph III | Ph III | ||||||
| Gastric cancer | Ph III | Ph III | ||||||
pazopanib + Tykerb
|
Inflammatory breast cancer | Ph III | Ph III | No longer pursuing this indication. | ||||
| Respiratory & Immuno-inflammation | USA | EU | News update in the quarter | |||||
Relovair HORIZON (‘444 & ‘698) |
COPD/Asthma | Ph III | Ph III | Phase III asthma programme commenced in March 2010. | ||||
| Vaccines | USA | EU | News update in the quarter | |||||
Menhibrix (HibMenCY-TT) |
MenCY and Hib prophylaxis | Filed | n/a | Date for expected VRBPAC meeting has not yet been set. | ||||
MAGE-A3
|
Melanoma | Ph III | Ph III | |||||
| NSCLC | Ph III | Ph III | ||||||
Nimenrix (MenACWY) |
MenACWY prophylaxis | Ph III | Ph III | Plan to file in EU in H2 2010. | ||||
New generation flu
|
Influenza prophylaxis | Ph III | Ph III | |||||
Simplirix
|
Genital herpes prophylaxis | Ph III | Ph III | |||||
Mosquirix
|
Malaria prophylaxis | n/a | n/a | Phase III study ongoing in Africa. | ||||
| Issued: Wednesday, 28th April 2010, London, U.K. | 12 |
Table of Contents
Balance sheet
| 31st March | 31st March | 31st December | ||||||||||
| 2010 | 2009 | 2009 | ||||||||||
| £m | £m | £m | ||||||||||
ASSETS |
||||||||||||
Non-current assets |
||||||||||||
Property, plant and equipment |
9,532 | 9,441 | 9,374 | |||||||||
Goodwill |
3,524 | 2,147 | 3,361 | |||||||||
Other intangible assets |
8,412 | 6,157 | 8,183 | |||||||||
Investments in associates and joint ventures |
965 | 499 | 895 | |||||||||
Other investments |
529 | 512 | 454 | |||||||||
Deferred tax assets |
2,492 | 2,772 | 2,374 | |||||||||
Derivative financial instruments |
94 | 112 | 68 | |||||||||
Other non-current assets |
653 | 560 | 583 | |||||||||
Total non-current assets |
26,201 | 22,200 | 25,292 | |||||||||
Current assets |
||||||||||||
Inventories |
4,157 | 4,107 | 4,064 | |||||||||
Current tax recoverable |
52 | 95 | 58 | |||||||||
Trade and other receivables |
6,814 | 5,920 | 6,492 | |||||||||
Derivative financial instruments |
87 | 258 | 129 | |||||||||
Liquid investments |
254 | 364 | 268 | |||||||||
Cash and cash equivalents |
6,964 | 6,221 | 6,545 | |||||||||
Assets held for sale |
28 | 2 | 14 | |||||||||
Total current assets |
18,356 | 16,967 | 17,570 | |||||||||
TOTAL ASSETS |
44,557 | 39,167 | 42,862 | |||||||||
LIABILITIES |
||||||||||||
Current liabilities |
||||||||||||
Short-term borrowings |
(1,034 | ) | (1,276 | ) | (1,471 | ) | ||||||
Trade and other payables |
(6,796 | ) | (5,752 | ) | (6,772 | ) | ||||||
Derivative financial instruments |
(127 | ) | (254 | ) | (168 | ) | ||||||
Current tax payable |
(1,716 | ) | (948 | ) | (1,451 | ) | ||||||
Short-term provisions |
(2,480 | ) | (1,516 | ) | (2,256 | ) | ||||||
Total current liabilities |
(12,153 | ) | (9,746 | ) | (12,118 | ) | ||||||
Non-current liabilities |
||||||||||||
Long-term borrowings |
(15,220 | ) | (15,106 | ) | (14,786 | ) | ||||||
Deferred tax liabilities |
(667 | ) | (717 | ) | (645 | ) | ||||||
Pensions and other post-employment benefits |
(3,280 | ) | (3,227 | ) | (2,981 | ) | ||||||
Other provisions |
(1,191 | ) | (1,529 | ) | (985 | ) | ||||||
Derivative financial instruments |
(6 | ) | (2 | ) | — | |||||||
Other non-current liabilities |
(614 | ) | (406 | ) | (605 | ) | ||||||
Total non-current liabilities |
(20,978 | ) | (20,987 | ) | (20,002 | ) | ||||||
TOTAL LIABILITIES |
(33,131 | ) | (30,733 | ) | (32,120 | ) | ||||||
NET ASSETS |
11,426 | 8,434 | 10,742 | |||||||||
EQUITY |
||||||||||||
Share capital |
1,417 | 1,416 | 1,416 | |||||||||
Share premium account |
1,384 | 1,340 | 1,368 | |||||||||
Retained earnings |
6,822 | 4,619 | 6,321 | |||||||||
Other reserves |
1,047 | 687 | 900 | |||||||||
Shareholders’ equity |
10,670 | 8,062 | 10,005 | |||||||||
Non-controlling interests |
756 | 372 | 737 | |||||||||
TOTAL EQUITY |
11,426 | 8,434 | 10,742 | |||||||||
| Issued: Wednesday, 28th April 2010, London, U.K. | 13 |
Table of Contents
Cash flow statement
Three months ended 31st March 2010
| Q1 2010 | Q1 2009 | 2009 | ||||||||||
| £m | £m | £m | ||||||||||
Profit after tax |
1,395 | 1,169 | 5,669 | |||||||||
Tax on profits |
536 | 497 | 2,222 | |||||||||
Share of after tax profits of associates and joint ventures |
(25 | ) | (14 | ) | (64 | ) | ||||||
Profit on disposal of interest in associates |
— | (115 | ) | (115 | ) | |||||||
Net finance expense |
188 | 175 | 713 | |||||||||
Depreciation and other non-cash items |
466 | 603 | 1,271 | |||||||||
(Increase)/decrease in working capital |
(277 | ) | 22 | (106 | ) | |||||||
Increase/(decrease) in other net liabilities |
122 | (271 | ) | (45 | ) | |||||||
Cash generated from operations |
2,405 | 2,066 | 9,545 | |||||||||
Taxation paid |
(283 | ) | (330 | ) | (1,704 | ) | ||||||
Net cash inflow from operating activities |
2,122 | 1,736 | 7,841 | |||||||||
Cash flow from investing activities |
||||||||||||
Purchase of property, plant and equipment |
(207 | ) | (268 | ) | (1,418 | ) | ||||||
Proceeds from sale of property, plant and equipment |
17 | 7 | 48 | |||||||||
Purchase of intangible assets |
(119 | ) | (120 | ) | (455 | ) | ||||||
Proceeds from sale of intangible assets |
— | — | 356 | |||||||||
Purchase of equity investments |
(61 | ) | (23 | ) | (154 | ) | ||||||
Proceeds from sale of equity investments |
10 | 1 | 59 | |||||||||
Purchase of businesses, net of cash acquired |
— | (501 | ) | (2,792 | ) | |||||||
Investment in associates and joint ventures |
(13 | ) | (7 | ) | (29 | ) | ||||||
Proceeds from disposal of interest in associates |
— | 178 | 178 | |||||||||
Decrease in liquid investments |
28 | 23 | 87 | |||||||||
Interest received |
19 | 41 | 90 | |||||||||
Dividends from associates and joint ventures |
2 | 3 | 17 | |||||||||
Net cash outflow from investing activities |
(324 | ) | (666 | ) | (4,013 | ) | ||||||
Cash flow from financing activities |
||||||||||||
Proceeds from own shares for employee share options |
6 | 3 | 13 | |||||||||
Issue of share capital |
17 | 15 | 43 | |||||||||
Shares acquired by ESOP Trusts |
(56 | ) | (50 | ) | (57 | ) | ||||||
Increase in long-term loans |
— | — | 1,358 | |||||||||
Repayment of short-term loans |
(625 | ) | (25 | ) | (748 | ) | ||||||
Increase in short-term loans |
15 | 191 | 646 | |||||||||
Net repayment of obligations under finance leases |
(11 | ) | (11 | ) | (48 | ) | ||||||
Interest paid |
(40 | ) | (56 | ) | (780 | ) | ||||||
Dividends paid to shareholders |
(763 | ) | (730 | ) | (3,003 | ) | ||||||
Distributions to non-controlling interests |
(67 | ) | (41 | ) | (89 | ) | ||||||
Other financing items |
(93 | ) | 50 | (109 | ) | |||||||
Net cash outflow from financing activities |
(1,617 | ) | (654 | ) | (2,774 | ) | ||||||
Increase in cash and bank overdrafts in the period |
181 | 416 | 1,054 | |||||||||
Exchange adjustments |
103 | (11 | ) | (158 | ) | |||||||
Cash and bank overdrafts at beginning of period |
6,368 | 5,472 | 5,472 | |||||||||
Cash and bank overdrafts at end of period |
6,652 | 5,877 | 6,368 | |||||||||
Cash and bank overdrafts at end of period comprise: |
||||||||||||
Cash and cash equivalents |
6,964 | 6,221 | 6,545 | |||||||||
Overdrafts |
(312 | ) | (344 | ) | (177 | ) | ||||||
| 6,652 | 5,877 | 6,368 | ||||||||||
| Issued: Wednesday, 28th April 2010, London, U.K. | 14 |
Table of Contents
Statement of changes in equity
| Share- | Non- | |||||||||||||||||||||||||||
| Share | Share | Retained | Other | holder’s | controlling | Total | ||||||||||||||||||||||
| capital | premium | earnings | reserves | equity | interests | equity | ||||||||||||||||||||||
| £m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||
At 1st January 2010 |
1,416 | 1,368 | 6,321 | 900 | 10,005 | 737 | 10,742 | |||||||||||||||||||||
Profit for the period |
— | — | 1,340 | — | 1,340 | 55 | 1,395 | |||||||||||||||||||||
Other comprehensive income for the
period |
— | — | 61 | 12 | 73 | 30 | 103 | |||||||||||||||||||||
Distributions to non-controlling interests |
— | — | — | — | — | (67 | ) | (67 | ) | |||||||||||||||||||
Dividends to shareholders |
— | — | (763 | ) | — | (763 | ) | — | (763 | ) | ||||||||||||||||||
Changes in non-controlling interests |
— | — | — | — | — | 1 | 1 | |||||||||||||||||||||
Shares issued |
1 | 16 | — | — | 17 | — | 17 | |||||||||||||||||||||
Consideration received for shares
transferred by ESOP Trusts |
— | — | — | 6 | 6 | — | 6 | |||||||||||||||||||||
Shares acquired by ESOP Trusts |
— | — | — | (56 | ) | (56 | ) | — | (56 | ) | ||||||||||||||||||
Write-down on shares held by ESOP
Trusts |
— | — | (185 | ) | 185 | — | — | — | ||||||||||||||||||||
Share-based incentive plans |
— | — | 48 | — | 48 | — | 48 | |||||||||||||||||||||
At 31st March 2010 |
1,417 | 1,384 | 6,822 | 1,047 | 10,670 | 756 | 11,426 | |||||||||||||||||||||
At 1st January 2009 |
1,415 | 1,326 | 4,622 | 568 | 7,931 | 387 | 8,318 | |||||||||||||||||||||
Profit for the period |
— | — | 1,131 | — | 1,131 | 38 | 1,169 | |||||||||||||||||||||
Other comprehensive (expense)/income
for the period |
— | (303 | ) | 16 | (287 | ) | (12 | ) | (299 | ) | ||||||||||||||||||
Distributions to non-controlling interests |
— | — | — | — | — | (41 | ) | (41 | ) | |||||||||||||||||||
Dividends to shareholders |
— | — | (730 | ) | — | (730 | ) | — | (730 | ) | ||||||||||||||||||
Shares issued |
1 | 14 | — | 15 | — | 15 | ||||||||||||||||||||||
Consideration received for shares
transferred by ESOP Trusts |
— | — | — | 3 | 3 | — | 3 | |||||||||||||||||||||
Shares acquired by ESOP Trusts |
— | — | — | (50 | ) | (50 | ) | — | (50 | ) | ||||||||||||||||||
Write-down on shares held by ESOP
Trusts |
— | — | (150 | ) | 150 | — | — | — | ||||||||||||||||||||
Share-based incentive plans |
— | — | 49 | — | 49 | — | 49 | |||||||||||||||||||||
At 31st March 2009 |
1,416 | 1,340 | 4,619 | 687 | 8,062 | 372 | 8,434 | |||||||||||||||||||||
| Issued: Wednesday, 28th April 2010, London, U.K. | 15 |
Table of Contents
Segmental information
GSK has revised its segmental information disclosures to reflect changes in the internal
reporting structures with effect from 1st January 2010. ViiV Healthcare is now shown as a separate
segment. Stiefel has been integrated with the GSK heritage dermatology business and is reported
within the relevant geographical pharmaceutical segments. The other trading and other unallocated
pharmaceuticals information has been combined. Comparative information has been restated onto a
consistent basis.
GSK’s operating segments are being reported based on the financial information provided to the
Chief Executive Officer and the responsibilities of the Corporate Executive Team (CET). Individual
members of the CET are responsible for geographic regions of the Pharmaceuticals business, ViiV
Healthcare and for the Consumer Healthcare business as a whole, respectively.
R&D investment is essential for the sustainability of the pharmaceutical businesses. However, for
segment reporting, the US, Europe, Emerging Markets and Asia Pacific/Japan pharmaceutical operating
profits exclude allocations of globally funded R&D as well as central costs, principally corporate
functions and unallocated manufacturing costs. GSK’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.
The Other trading and unallocated pharmaceuticals segment includes Canada, Puerto Rico, central
vaccine tender sales and contract manufacturing sales, together with costs such as vaccines R&D and
central manufacturing costs not attributed to other segments.
The Pharmaceuticals R&D segment is the responsibility of the Chairman, Research & Development and
is therefore being reported as a separate segment.
Corporate and other unallocated costs and disposal profits include corporate functions, costs for
legal matters, fair value movements on financial instruments and investments and profits on global
asset disposals.
Turnover by segment
| Q1 2009 | ||||||||||||
| Q1 2010 | (restated) | Growth | ||||||||||
| £m | £m | CER% | ||||||||||
US pharmaceuticals |
1,909 | 2,088 | (1 | ) | ||||||||
Europe pharmaceuticals |
1,893 | 1,669 | 16 | |||||||||
Emerging Markets pharmaceuticals |
866 | 639 | 43 | |||||||||
Asia Pacific/Japan pharmaceuticals |
885 | 619 | 45 | |||||||||
ViiV Healthcare |
373 | 419 | (7 | ) | ||||||||
Other trading and unallocated pharmaceuticals |
200 | 184 | 4 | |||||||||
Pharmaceuticals turnover |
6,126 | 5,618 | 14 | |||||||||
Consumer Healthcare turnover |
1,231 | 1,151 | 9 | |||||||||
| 7,357 | 6,769 | 13 | ||||||||||
| Issued: Wednesday, 28th April 2010, London, U.K. | 16 |
Table of Contents
Operating profit by segment
| Q1 2009 | ||||||||||||
| Q1 2010 | (restated) | Growth | ||||||||||
| £m | £m | CER% | ||||||||||
US pharmaceuticals |
1,295 | 1,349 | 4 | |||||||||
Europe pharmaceuticals |
1,138 | 918 | 26 | |||||||||
Emerging Markets pharmaceuticals |
313 | 205 | 62 | |||||||||
Asia Pacific/Japan pharmaceuticals |
525 | 329 | 63 | |||||||||
ViiV Healthcare |
212 | 291 | (23 | ) | ||||||||
Pharmaceuticals R&D |
(765 | ) | (885 | ) | (10 | ) | ||||||
Other trading and unallocated pharmaceuticals |
(127 | ) | (154 | ) | 59 | |||||||
Pharmaceuticals operating profit |
2,591 | 2,053 | 27 | |||||||||
Consumer Healthcare operating profit |
198 | 184 | 9 | |||||||||
Segment profit |
2,789 | 2,237 | 26 | |||||||||
Corporate and other unallocated costs and disposal profits |
(394 | ) | (261 | ) | ||||||||
Operating profit before major restructuring |
2,395 | 1,976 | 21 | |||||||||
Major restructuring |
(301 | ) | (264 | ) | ||||||||
Total operating profit |
2,094 | 1,712 | 22 | |||||||||
Finance income |
17 | 28 | ||||||||||
Finance costs |
(205 | ) | (203 | ) | ||||||||
Profit on disposal of interest in associate |
— | 115 | ||||||||||
Share of after tax profits of associates and joint ventures |
25 | 14 | ||||||||||
Profit before taxation |
1,931 | 1,666 | 15 | |||||||||
Segmental commentary
US pharmaceuticals operating profit increased 4% in the quarter despite a decline in turnover
of 1%. This reflects the receipt of a payment from Genentech for the exclusive promotion rights to
Boniva for 2010 in the USA.
Europe pharmaceuticals operating profit increased 26% reflecting the turnover increase of 16%,
benefiting from strong H1N1 sales in the quarter, and a 6% reduction in SG&A costs.
Emerging Markets operating profit grew by 62% on a turnover increase of 43%, reflecting strong HINI rates and increased investment in this segment.
Asia Pacific/Japan pharmaceuticals operating profit rose by 63%, principally as a result of the
significant H1N1 sales in the quarter; turnover increased by 45%.
In ViiV Healthcare higher SG&A costs adversely impacted operating profit by 10%. The higher SG&A
costs were primarily due to an increase in phase IV clinical trial expenditure, the amortisation of
acquired intangible assets and close out of integration activities.
Other trading and unallocated pharmaceuticals operating loss increased 59%, primarily reflecting
higher stock write-offs in the quarter.
Pharmaceuticals R&D costs decreased by 10%, reflecting lower intangible asset write-offs of £32
million in the quarter (Q1 2009: £115m) and the phasing of project expenditure.
Consumer Healthcare operating profit grew in line with the turnover increase of 9%.
Corporate and other unallocated costs increased primarily as a result of the higher legal charges
of £210 million in the quarter (Q1 2009: £51m).
| Issued: Wednesday, 28th April 2010, London, U.K. | 17 |
Table of Contents
Legal matters
The Group is involved in various legal and administrative proceedings principally product
liability, intellectual property, tax, anti-trust and governmental investigations as well as
related private litigation, which are more fully described in the ‘Legal proceedings’ note in the
Annual Report 2009.
At 31st March 2010, the Group’s aggregate provision for legal and other disputes (not including tax
matters described under ‘Taxation’ below) was £2.3 billion. In respect of a number of legal
proceedings in which the Group is involved, it is not possible to make a reasonable estimate of the
expected financial effect, if any, that will result from ultimate resolution of the proceedings.
In these cases, the Group may disclose information with respect to the nature and facts of the
cases but no provision is typically 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 there can, therefore, be no assurance that any losses
that result from the outcome of any legal proceedings will not exceed the amount of the provisions
reported in the Group’s financial accounts by a material amount.
Significant developments since the date of the Annual Report 2009 are as follows:
Arzerra
On 23rd March 2010, Genentech and Biogen Idec filed suit against the Group in the Southern District
of California alleging that the Group’s sale of Arzerra induces and contributes to infringement of
US Patent No. 7,682,612. That patent claims the treatment of chronic lymphatic leukemia with an anti-CD-20
monoclonal antibody. The Group believes that there are numerous defences to the suit and will
respond to the complaint.
Combivir
In April 2010, the Group and Teva Pharmaceuticals agreed to settle the suit filed by the Group in
the US District Court for the District of Delaware alleging that Teva was infringing a patent
related to Combivir, which was set to expire in May 2012. The terms of the settlement are
confidential and subject to review by the Federal Trade Commission and Department of Justice.
Developments with respect to tax matters are described in ‘Taxation’ below.
Taxation
Transfer pricing and other issues are as previously described in the ‘Taxation’ note to the
Financial Statements included in the Annual Report 2009. There have been no material changes to
tax matters since the publication of the Annual Report.
GSK continues to believe that it has made adequate provision for the liabilities likely to arise
from open assessments. The ultimate liability for such matters may vary from the amounts provided
and is dependent upon the outcome of litigation proceedings and negotiations with the relevant tax
authorities.
| Issued: Wednesday, 28th April 2010, London, U.K. | 18 |
Table of Contents
Dividends
| Paid/ | Pence per | |||||||||||
| payable | share | £m | ||||||||||
2010 |
||||||||||||
First interim |
8th July 2010 | 15 | 763 | |||||||||
2009 |
||||||||||||
First interim |
9th July 2009 | 14 | 701 | |||||||||
Second interim |
8th October 2009 | 14 | 713 | |||||||||
Third interim |
7th January 2010 | 15 | 763 | |||||||||
Fourth interim |
8th April 2010 | 18 | 920 | |||||||||
| 61 | 3,097 | |||||||||||
Weighted average number of shares
| Q1 2010 | Q1 2009 | 2009 | ||||||||||
| millions | millions | millions | ||||||||||
Weighted average number of shares — basic |
5,078 | 5,064 | 5,069 | |||||||||
Dilutive effect of share options and share awards |
46 | 24 | 39 | |||||||||
Weighted average number of shares — diluted |
5,124 | 5,088 | 5,108 | |||||||||
Net assets
The book value of net assets increased by £684 million from £10,742 million at 31st December
2009 to £11,426 million at 31st March 2010. This reflects an increase in net assets arising from the
operating activities in the period partially offset by the dividend payment and an increase in the
pension deficit. The increase in the pension deficit arose predominantly from an increase in the
estimated long-term UK inflation rate, and a decrease in the rate used to discount UK pension
liabilities from 5.70% to 5.50% and the rate used to discount US pension liabilities from 5.75% to
5.60%, partly offset by an increase in asset values. At 31st March 2010, the net deficit on the
Group’s pension plans was £1,941 million compared with £1,745 million at 31st December 2009.
The carrying value of investments in associates and joint ventures at 31st March 2010 was £965
million, with a market value of £1,894 million.
At 31st March 2010, the ESOP Trusts held 108.7 million GSK shares against the future exercise of
share options and share awards. The carrying value of £1,003 million has been deducted from other
reserves. The market value of these shares was £1,375 million.
GSK did not purchase any shares for cancellation in the period. At 31st March, the company held
474.2 million Treasury shares at a cost of £6,286 million, which has been deducted from retained
earnings.
| Issued: Wednesday, 28th April 2010, London, U.K. | 19 |
Table of Contents
| Q1 2010 | Q1 2009 | 2009 | ||||||||||
| Reconciliation of cash flow to movements in net debt | £m | £m | £m | |||||||||
Net debt at beginning of the period |
(9,444 | ) | (10,173 | ) | (10,173 | ) | ||||||
Increase in cash and bank overdrafts |
181 | 416 | 1,054 | |||||||||
Cash inflow from liquid investments |
(28 | ) | (23 | ) | (87 | ) | ||||||
Net increase in long-term loans |
— | — | (1,358 | ) | ||||||||
Net repayment/(increase in) of short-term loans |
610 | (166 | ) | 102 | ||||||||
Net repayment of obligations under finance leases |
11 | 11 | 48 | |||||||||
Debt of subsidiary undertakings acquired |
— | — | (9 | ) | ||||||||
Exchange adjustments |
(349 | ) | 167 | 1,041 | ||||||||
Other non-cash movements |
(17 | ) | (29 | ) | (62 | ) | ||||||
Decrease in net debt |
408 | 376 | 729 | |||||||||
Net debt at end of the period |
(9,036 | ) | (9,797 | ) | (9,444 | ) | ||||||
Related party transactions
The Group’s significant related parties are its joint ventures and
associates as disclosed in the Annual Report 2009.
There were no material transactions with any of the Group’s joint ventures and
associates in the period. There were also no material transactions with
directors.
Contingent liabilities
There were contingent liabilities at 31st March 2010 in respect of
guarantees and indemnities entered into as part of the ordinary course of the
Group’s business. No material losses are expected to arise from such contingent
liabilities.
Exchange rates
The Group 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 2010 | Q1 2009 | 2009 | ||||||||||
Average rates: |
||||||||||||
£/US$ |
1.56 | 1.44 | 1.56 | |||||||||
£/Euro |
1.13 | 1.09 | 1.12 | |||||||||
£/Yen |
143 | 136 | 146 | |||||||||
Period end rates: |
||||||||||||
£/US$ |
1.52 | 1.43 | 1.61 | |||||||||
£/Euro |
1.12 | 1.08 | 1.13 | |||||||||
£/Yen |
142 | 142 | 150 | |||||||||
During Q1, average Sterling exchange rates were stronger against the US Dollar,
the Euro and the Yen compared with the same period in 2009. Period end Sterling
exchange rates were stronger against the US Dollar and the Euro.
| Issued: Wednesday, 28th April 2010, London, U.K. | 20 |
Table of Contents
Accounting presentation and policies
This unaudited Results Announcement containing condensed financial
information for the three months ended 31st March 2010 is prepared in
accordance with the Disclosure and Transparency Rules of the United Kingdom’s
Financial Services Authority IAS34 “Interim financial reporting” and the accounting policies set out in the Annual
Report 2009, except that GSK has implemented IFRS 3 (Revised) ‘Business
combinations’, IAS 27 (Revised) ‘Consolidated and separate financial
statements: recognition and measurement’ and IFRIC 17 ‘Distributions of
non-cash assets to owners’.
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
balance sheet at 31st December 2009 has been derived from the full Group
accounts published in the Annual Report 2009, which has been delivered to the
Registrar of Companies and on which the report of the independent auditors was
unqualified and did not contain a statement under section 498 of the Companies
Act 2006.
Internet
This Announcement and other information about GSK are available on the
company’s website at: http://www.gsk.com.
| Issued: Wednesday, 28th April 2010, London, U.K. | 21 |
Table of Contents
Additional P&L information
Three months ended 31st March 2010
| Other | ||||||||||||||||||||||||||||||||
| Cost of | SG&A | R&D | operating | Operating | Operating | |||||||||||||||||||||||||||
| Turnover | sales | costs | costs | income | profit | margin % | ||||||||||||||||||||||||||
US pharmaceuticals |
Q1 2010 | £m | 1,909 | (209 | ) | (522 | ) | — | 117 | 1,295 | 67.8 | |||||||||||||||||||||
| Q1 2009 (restated) | £m | 2,088 | (197 | ) | (549 | ) | — | 7 | 1,349 | 64.6 | ||||||||||||||||||||||
| Growth CER | % | (1 | ) | 10 | 3 | — | >100 | 4 | ||||||||||||||||||||||||
Europe pharmaceuticals |
Q1 2010 | £m | 1,893 | (396 | ) | (363 | ) | — | 4 | 1,138 | 60.1 | |||||||||||||||||||||
| Q1 2009 (restated) | £m | 1,669 | (355 | ) | (398 | ) | — | 2 | 918 | 55.0 | ||||||||||||||||||||||
| Growth CER | % | 16 | 14 | (6 | ) | — | 100 | 26 | ||||||||||||||||||||||||
Emerging Markets
pharmaceuticals |
Q1 2010 | £m | 866 | (317 | ) | (235 | ) | (1 | ) | — | 313 | 36.1 | ||||||||||||||||||||
| Q1 2009 (restated) | £m | 639 | (228 | ) | (206 | ) | (1 | ) | 1 | 205 | 32.1 | |||||||||||||||||||||
| Growth CER | % | 43 | 39 | 28 | — | (100 | ) | 62 | ||||||||||||||||||||||||
Asia Pacific / Japan
pharmaceuticals |
Q1 2010 | £m | 885 | (192 | ) | (164 | ) | (6 | ) | 2 | 525 | 59.3 | ||||||||||||||||||||
| Q1 2009 (restated) | £m | 619 | (139 | ) | (149 | ) | (5 | ) | 3 | 329 | 53.2 | |||||||||||||||||||||
| Growth CER | % | 45 | 37 | 9 | 40 | (33 | ) | 63 | ||||||||||||||||||||||||
ViiV Healthcare |
Q1 2010 | £m | 373 | (83 | ) | (68 | ) | (7) | * | (3 | ) | 212 | 56.8 | |||||||||||||||||||
| Q1 2009 (restated) | £m | 419 | (79 | ) | (41 | ) | (5) | * | (3 | ) | 291 | 69.5 | ||||||||||||||||||||
| Growth CER | % | (7 | ) | 6 | 71 | 40 | (33 | ) | (23 | ) | ||||||||||||||||||||||
Pharmaceuticals R&D |
Q1 2010 | £m | — | — | (42 | ) | (725 | ) | 2 | (765 | ) | |||||||||||||||||||||
| Q1 2009 (restated) | £m | — | — | (48 | ) | (841 | ) | 4 | (885 | ) | ||||||||||||||||||||||
| Growth CER | % | — | — | (6 | ) | (10 | ) | (25 | ) | (10 | ) | |||||||||||||||||||||
Other trading and
unallocated
pharmaceuticals |
Q1 2010 | £m | 200 | (221 | ) | (32 | ) | (142 | ) | 68 | (127 | ) | ||||||||||||||||||||
| Q1 2009 (restated) | £m | 184 | (181 | ) | (64 | ) | (147 | ) | 54 | (154 | ) | |||||||||||||||||||||
| Growth CER | % | 4 | 28 | >100 | (2 | ) | 28 | 59 | ||||||||||||||||||||||||
Total pharmaceuticals |
Q1 2010 | £m | 6,126 | (1,418 | ) | (1,426 | ) | (881 | ) | 190 | 2,591 | 42.3 | ||||||||||||||||||||
| Q1 2009 (restated) | £m | 5,618 | (1,179 | ) | (1,455 | ) | (999 | ) | 68 | 2,053 | 36.5 | |||||||||||||||||||||
| Growth CER | % | 14 | 22 | 11 | (8 | ) | >100 | 27 | ||||||||||||||||||||||||
Consumer Healthcare |
Q1 2010 | £m | 1,231 | (483 | ) | (515 | ) | (37 | ) | 2 | 198 | 16.1 | ||||||||||||||||||||
| Q1 2009 (restated) | £m | 1,151 | (444 | ) | (490 | ) | (33 | ) | — | 184 | 16.0 | |||||||||||||||||||||
| Growth CER | % | 9 | 11 | 8 | 18 | — | 9 | |||||||||||||||||||||||||
Corporate and other
unallocated costs |
Q1 2010 | £m | — | (23 | ) | (357 | ) | (21 | ) | 7 | (394 | ) | ||||||||||||||||||||
| Q1 2009 (restated) | £m | — | (21 | ) | (184 | ) | (42 | ) | (14 | ) | (261 | ) | ||||||||||||||||||||
| Growth CER | % | — | 10 | >100 | (48 | ) | >100 | 60 | ||||||||||||||||||||||||
Results before major
restructuring |
Q1 2010 | £m | 7,357 | (1,924 | ) | (2,298 | ) | (939 | ) | 199 | 2,395 | 32.6 | ||||||||||||||||||||
| Q1 2009 (restated) | £m | 6,769 | (1,644 | ) | (2,129 | ) | (1,074 | ) | 54 | 1,976 | 29.2 | |||||||||||||||||||||
| Growth CER | % | 13 | 19 | 18 | (9 | ) | >100 | 21 | ||||||||||||||||||||||||
| * | Note: This excludes HIV discovery research (pre-Phase IIb) which is conducted by GSK and Pfizer and R&D expenditure related to the Shionogi JV and Phase IV clinical expenditure which are reported within the ViiV Healthcare OOI and SG&A lines respectively. |
| Issued: Wednesday, 28th April 2010, London, U.K. | 22 |
Table of Contents
The following table provides additional financial analysis for worldwide
vaccines and worldwide dermatologicals which are not segments for financial
reporting purposes and are managed within the geographical pharmaceutical
segments. Consequently these results are included within the financial
information of the relevant geographical pharmaceuticals segments as reported
to the CEO and presented in the tables on pages 16 to 17.
Three months ended 31st March 2010
| Other | ||||||||||||||||||||||||||||||||
| Cost of | SG&A | R&D | operating | Operating | Operating | |||||||||||||||||||||||||||
| Turnover | sales | costs | costs | income | profit | margin % | ||||||||||||||||||||||||||
Worldwide vaccines |
Q1 2010 | £m | 1,411 | (389 | ) | (170 | ) | (117 | ) | 28 | 763 | 54.1 | ||||||||||||||||||||
| Q1 2009 (restated) | £m | 625 | (201 | ) | (150 | ) | (118 | ) | 24 | 180 | 28.8 | |||||||||||||||||||||
| Growth CER | % | >100 | 98 | 18 | 2 | 17 | >100 | |||||||||||||||||||||||||
Worldwide
dermatologicals |
Q1 2010 | £m | 265 | (53 | ) | (78 | ) | (8 | ) | 1 | 127 | 47.9 | ||||||||||||||||||||
| Q1 2009 (restated) | £m | 112 | (25 | ) | (3 | ) | — | — | 84 | 75.0 | ||||||||||||||||||||||
| Growth CER | % | >100 | >100 | >100 | — | — | 55 | |||||||||||||||||||||||||
All other
pharmaceuticals |
Q1 2010 | £m | 4,450 | (976 | ) | (1,178 | ) | (756 | ) | 161 | 1,701 | 38.2 | ||||||||||||||||||||
| Q1 2009 (restated) | £m | 4,881 | (953 | ) | (1,302 | ) | (881 | ) | 44 | 1,789 | 36.7 | |||||||||||||||||||||
| Growth CER | % | (5 | ) | 4 | 4 | (11 | ) | >100 | (5 | ) | ||||||||||||||||||||||
Total pharmaceuticals |
Q1 2010 | £m | 6,126 | (1,418 | ) | (1,426 | ) | (881 | ) | 190 | 2,591 | 42.3 | ||||||||||||||||||||
| Q1 2009 (restated) | £m | 5,618 | (1,179 | ) | (1,455 | ) | (999 | ) | 68 | 2,053 | 36.5 | |||||||||||||||||||||
| Growth CER | % | 14 | 22 | 11 | (8 | ) | >100 | 27 | ||||||||||||||||||||||||
| Issued: Wednesday, 28th April 2010, London, U.K. | 23 |
Table of Contents
Independent review report to GlaxoSmithKline plc
Introduction
We have been engaged by the company to review the condensed financial
information in the Results Announcement for the three months ended 31st March
2010 which comprises the income statement, statement of comprehensive income,
balance sheet, cash flow statement, statement of changes in equity and related
notes (excluding the Late-stage pharmaceuticals and vaccines pipeline table, and the
additional P&L information). We have read the other information contained in
the Results Announcement and considered whether it contains any apparent
misstatements or material inconsistencies with the information in the condensed
financial information.
Directors’ responsibilities
The Results Announcement is the responsibility of, and has been approved by,
the directors. The directors are responsible for preparing the Results
Announcement in accordance with the Disclosure and Transparency Rules of the
United Kingdom’s Financial Services Authority.
The annual financial statements of the group are prepared in accordance with
IFRSs as adopted by the European Union. The condensed financial information
included in the Results Announcement for the three months ended 31st
March 2010 has been prepared in accordance with
International Accounting Standard 34, “Interim Financial
Reporting” as adopted by the European Union.
Our responsibility
Our responsibility is to express to the company a conclusion on the condensed
financial information in the Results Announcement based on our review. This
report, including the conclusion, has been prepared for and only for the
company for the purpose of the Disclosure and Transparency Rules of the
Financial Services Authority and for no other purpose. We do not, in producing
this report, accept or assume responsibility for any other purpose or to any
other person to whom this report is shown or into whose hands it may come save
where expressly agreed by our prior consent in writing.
Scope of review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, ‘Review of Interim Financial Information
Performed by the Independent Auditor of the Entity’ issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making enquiries, 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 Ireland) 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.
Conclusion
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 31st March 2010 is not prepared, in all material
respects, in accordance with International Accounting Standard 34 as
adopted by the European Union and the Disclosure and Transparency
Rules of the United Kingdom’s Financial Services Authority.
PricewaterhouseCoopers LLP
Chartered Accountants
28th April 2010
London
Chartered Accountants
28th April 2010
London
Notes:
| (a) | The maintenance and integrity of the GlaxoSmithKline plc website is the responsibility of the directors; the work carried out by the auditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may have occurred to the condensed financial information since it was initially presented on the website. | |
| (b) | Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. |
| Issued: Wednesday, 28th April 2010, London, U.K. | 24 |