GlaxoSmithKline Pharmaceuticals Limited (GSK Pharma) has announced strong financial results for the second quarter and half year ended September 30, 2024, showcasing growth in both revenue and profitability.

Q2 FY25 Performance Highlights

• Revenue Growth: The company reported standalone revenue from operations of Rs 1,000.05 crore for Q2 FY25, marking a 4.9% increase from Rs 953.38 crore in the corresponding quarter last year.
• Profit Surge: Profit for the quarter rose to Rs 248.69 crore, up 15.4% compared to Rs 215.54 crore in the same period last year.
• Earnings Per Share: Basic and diluted earnings per share after exceptional items stood at Rs 14.68 for the quarter.

H1 FY25 Financial Overview

• Half-Year Revenue: For the six-month period, standalone revenue reached Rs 1,811.05 crore, up 7.1% from Rs 1,691.40 crore in the previous year.
• Half-Year Profit: Profit for H1 FY25 increased significantly to Rs 430.34 crore, a 24.3% jump from Rs 346.12 crore in the corresponding period.
• Half-Year EPS: The company reported earnings per share of Rs 25.40 for the half year.

Special Interim Dividend

In a move that will likely please shareholders, the Board of Directors has recommended a special interim dividend of Rs 12 per equity share on a face value of Rs 10 each.

Income Tax Refund

GSK Pharma received a substantial income tax refund of Rs 222.32 crore for the Assessment Year 2022-23, which may have contributed to the company's strong financial position.

Financial Analysis

Comparing the quarterly results with the previous year:

The company's performance shows resilience and growth despite challenging market conditions. The increase in revenue and profit indicates effective cost management and possibly market share gains.

Management Commentary

While specific management comments were not provided, the strong financial results and the declaration of a special interim dividend suggest confidence in the company's financial health and future prospects.

GSK Pharmaceuticals' robust performance in Q2 and H1 FY25, coupled with the special dividend announcement, positions the company favorably in the pharmaceutical sector. Investors and stakeholders will likely view these results positively, reflecting the company's ability to deliver growth and shareholder value in a competitive market environment.

GlaxoSmithKline Pharmaceuticals Limited (GSK Pharma) reported flat revenue growth for the first quarter, as the company faced headwinds in its dermatology and anti-infective segments. Despite the challenging topline performance, the company improved its profitability and is set to launch its oncology portfolio in the coming quarter.

Q1 Financial Highlights

• Revenue growth remained flat, impacted by supply constraints and muted performance in key segments
• EBITDA margin improved to 31.20%, a 290 basis points increase
• Profit After Tax (PAT) grew by 12.70%
• Earnings Per Share (EPS) increased by 13.00% to Rs. 12.08

Key Factors Affecting Q1 Performance

• Supply constraints due to a fire incident at a Contract Manufacturing Organization (CMO) reduced growth by approximately 2.00%
• Muted performance in dermatology and anti-infective segments
• Delayed start to the monsoon season impacted antibiotic sales

Business Segment Performance

• Vaccine business grew by 8.60%
• General medicines business declined by 2.00%
• Shingrix (shingles vaccine) continues to show strong growth, with 9,000-10,000 doses administered monthly

Oncology Portfolio Launch

GSK Pharma is set to launch its oncology portfolio in the next quarter, marking its re-entry into the oncology space after nearly a decade. The company will introduce two innovative drugs:

1. Zejula (Niraparib): For ovarian cancer treatment

   • Target patient pool: Approximately 5,000 eligible patients
   • Competitive advantage: 40.00% overall survival rate at 5 years

2. Jemperli (Dostarlimab): For endometrial cancer treatment

   • Initial target: Second-line treatment for about 1,000 eligible patients
   • Future potential: Awaiting approval for first-line treatment

Future Outlook

• The company remains committed to achieving double-digit growth
• Expects normalization of supply for key brands like Calpol in the coming months
• Continues to invest in new growth platforms, including Shingrix, Nucala, and Trelegy Ellipta
• Plans to launch RSV vaccine in the future

Market Dynamics

• Approximately 40.00% of GSK Pharma's portfolio falls under the National List of Essential Medicines (NLEM)
• The company estimates that trade generics may impact 5-7% of the branded market volume in the near term

GSK Pharma's Managing Director, Bhushan Akshikar, expressed confidence in the company's growth strategy, stating, "We remain committed to our growth ambitions. With the base business expected to return to volume growth, price hikes kicking in, and new growth platforms including oncology, we are well-positioned for the future."

As GSK Pharma navigates through the challenges in its traditional segments, the launch of its oncology portfolio and continued focus on vaccines and specialty products are expected to drive growth in the coming quarters.