GSK Surpasses Expectations with Strong Q2 Performance

British drugmaker GSK has raised its annual earnings and sales forecasts following a strong second-quarter performance, driven by success in its cancer and HIV portfolio. Despite challenges like narrowed RSV vaccine recommendations, the company beat market expectations with core earnings of 43.4 pence per share on sales of 7.88 billion pounds.

British drugmaker GSK raised its annual earnings and sales forecasts on Wednesday, posting second-quarter results that surpassed market expectations. The company's robust performance was bolstered by its cancer and HIV portfolio.

CEO Emma Walmsley's strategic focus on cancer and infectious disease drugs, including the blockbuster respiratory syncytial virus (RSV) vaccine Arexvy, has started to yield results. This comes as GSK aims to counterbalance the impact of patent expirations and declining revenue from current bestsellers by the end of the decade. However, investor sentiments were shaken by a U.S. public health agency's recent decision to narrow the RSV vaccine's recommended age group, limiting market potential.

As a result, GSK adjusted its 2024 vaccine sales outlook, forecasting growth in the low to mid-single digits instead of the previously anticipated high single-digit to low double-digit range. In Q2, Arexvy sales fell short of expectations, registering 62 million pounds against a projected 70 million pounds.

The drugmaker reported second-quarter core earnings of 43.4 pence per share on sales of 7.88 billion pounds, outpacing analysts' predictions of 38.9 pence per share and 7.51 billion pounds in sales. GSK now anticipates 2024 core earnings per share to rise by 10% to 12%, up from an earlier 8% to 10% projection. This marks the second upward revision in GSK's profit forecast for this year.

For the full year, GSK's sales are expected to grow between 7% and 9%, an improvement from the previously forecasted 5% to 7% range. The exchange rate stands at $1 = 0.7790 pounds ($1 = 0.7788 pounds).

(With inputs from agencies.)