Financial Reports: GlaxoSmithKline 2Q11

GSK 2Q

2Q Revenues: GBP 6.7 billion (-4%)

2Q Earnings: GBP 1.1 billion (loss of GBP 252 million in 2Q10)

YTD Revenues: GBP 13.3 billion (-7%)

YTD Earnings: GBP 2.7 billion (+139%)

All results in GBP, not dollars.

Comments: Pharmaceuticals and Vaccines revenues fell 3% to GBP 5.4 billion in 2Q11, as a result of Avandia and Valtrex losses, in concert with reduced pandemic sales compared to 2010. YTD revenues fell 9% to GBP 10.7 billion. Pharma/Vaccine sales in the U.S. were down 4% for 2Q and 8% for YTD; those sales in Europe were down 9% and 17% for the two periods, respectively; in Emerging Markets, they were up 12% and 5% for the two periods. Pharmaceutical revenues were led by Seretide/Advair, at GBP 1.3 billion (+2%) for 2Q and GBP 3.6 billion (+3%) YTD. Valtrex revenues, impacted by generics, dropped 48% to GBP 86 million in 2Q. Restructuring efforts have overachieved and GSK has revised the savings from this effort to GBP 2.5 billion from 2.2 billion. The company will ” continue to apply sustained pressure to GSK’s cost base to realize further savings, through improvements in areas such as support functions, supply chain and procurement efficiency.”