Shares in GlaxoSmithKline (LON:GSK) have fallen deep into the red in today’s session after the blue-chip drugmaker updated investors on its first-quarter performance, disclosing falls in profit and turnover. The blue-chip drugmaker revealed that it was hit by a rise in the pound.
As of 13:56 BST, GSK’s share price had lost 3.31 percent to 1,413.80p, underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.81 percent lower at 7,365.55 points. The pharmco’s shares have lost more than 11 percent of their value over the past year, as compared with about a 1.2-percent rise in the Footsie.
Strong pound hits GSK’s Q1 performance
GSK disclosed in a statement today that its turnover had fallen two percent in sterling terms to £7.22 billion in the first quarter of the year, while its total operating profit came in 28 percent lower at £1.24 billion, noting that the negative currency impact primarily reflected the recent strength of sterling, particularly against the US dollar and the yen, relative to the prior-year period. The blue-chip drugmaker further noted that if exchange rates were to hold at the closing rates on March 31 for the remainder of the year, the estimated negative impact on full-year 2018 Sterling turnover growth would be around five percent.
Going forward, GSK expects to make continued progress this year, while noting that its earnings per share growth would be impacted by a number of factors including the timing of potential generic competition to its flagship respiratory drug Advair in the US.
Group won’t enter Shire takeover battle
In a separate development, Reuters quoted GSK’s chief executive Emma Walmsley as commenting toady that she had no interest in acquiring Shire (LON:SHP), which today agreed a preliminary tie-up deal with Takeda Pharmaceutical. Speaking to reporters, she noted that the company’s focus was on deals to acquire early-stage experimental drugs which would help the group rebuild its pipeline.