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Glaxo (GSK) Beats Earnings & Revenue Estimates in Q4

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GlaxoSmithKline plc (GSK - Free Report) , one of the largest health care companies, reshaped its business following the March 2015 completion of the three-part, inter-conditional transaction with Novartis related to its Consumer Healthcare, Vaccines and Oncology businesses. Under the deal, Glaxo sold its oncology assets to Novartis and acquired Novartis’ Vaccines business (excluding influenza vaccines). Additionally, the companies created a joint venture (“JV”), thereby combining their consumer divisions to form a larger consumer health care business.

Following the completion of the deal, the UK-based company now focuses on its three core businesses – Pharmaceuticals (respiratory, HIV), Vaccines (pediatric, adolescent, adult, and travel vaccines) and Consumer Healthcare (wellness, oral health, nutrition and skin health products). However, Glaxo is currently focusing on adding cancer drugs to boost its pharma pipeline.

Meanwhile, like many of its peers, Glaxo is facing challenges in the form of stiff competition, genericization, pricing pressure and slowing growth in emerging markets. In this scenario, investor focus remains on late-stage pipeline candidates and their commercial potential, restructuring and cost-cutting initiatives and performance of new products apart from the usual top-and bottom-line numbers.

Glaxo’s performance has been mixed so far, with the company’s earnings beating expectations twice in the trailing four quarters while missed in the other two. Overall, the company has delivered an average positive surprise of 1.61%.

Currently, Glaxo has a Zacks Rank #3 (Hold), but that could definitely change following the company’s earnings report which was just released. We have highlighted some of the key stats from this just-revealed announcement below:

Earnings Beat: Glaxo reported core earnings of 80 cents per American depositary share in the fourth quarter of 2018, which beat our consensus estimate of 70 cents. The company’s focus on cost control initiative has boosted margins.

Revenues Beat: Revenues were up 5% year over year at constant exchange rate (CER) to $10.54 billion (£8.2 billion).  Revenues beat the Zacks Consensus Estimate of $9.85 billion.

Key Stats: While sales in Consumer Healthcare and Pharmaceuticals were up 1% and 4%. respectively, the Vaccines segment increased 18% at CER. Glaxo acquired TESARO and announced agreement with Merck KGaA to add oncology products to its pharma portfolio.

2019 Guidance: Glaxo expects EPS to decline by 5-9% at CER in 2019 which includes impact of Advair generic, acquisition of TESARO, joint venture with Pfizer for Consumer Healthcare business ad divestment of certain nutrition brands.

Share Price Impact: Shares rose almost 0.6% in pre-market trading.

Check back later for our full write up on GSK earnings report later! 1.286373

GlaxoSmithKline plc Price and EPS Surprise

 

GlaxoSmithKline plc Price and EPS Surprise | GlaxoSmithKline plc Quote

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