LONDON (dpa-AFX) - GlaxoSmithKline plc (GSK.L) reported that its profit for the third-quarter of 2014 increased from the last year. GSK said that it is on track to achieve guidance for 2015 and remains confident in outlook for 2016. It expects to pay an annual ordinary dividend of 80 pence for each of the next three years. It also plans to return about 1 billion pounds or 20 pence per share to shareholders via by a special dividend to be declared on 3 February 2016.
'We remain focused on delivering sustained improvements in operational performance and are confident in our outlook for the rest of this year and a return to earnings growth in 2016,' said Andrew Witty, Chief Executive Officer, GSK.
Core earnings per share for 2015 is expected to decline at a percentage rate in the high teens (CER), primarily due to continued pricing pressure on Seretide/Advair in the US/Europe, the dilutive effect of the Novartis transaction and the inherited cost base of the Novartis businesses. The 2015 guidance excludes potential income from the proposed divestment of ofatumumab, which was announced on 21 August 2015.
In 2016, GSK expects to see a significant recovery in core earnings per share with percentage growth expected to reach double digits on a CER basis as the adverse impacts seen in 2015 diminish and the sales and synergy benefits of the Novartis transaction contribute more meaningfully.
GSK expects to pay an annual ordinary dividend of 80 pence for each of the next three years (2015-2017).
GSK also plans to return approximately 1 billion pounds or 20 pence per share to shareholders via by a special dividend to be declared on 3 February 2016. The ex-dividend date would be 18 February 2016 (17 February 2016 for ADR holders), with a record date of 19 February 2016 and a payment date of 14 April 2016.
Profit attributable to shareholders for the third-quarter rose to 538 million pounds from 401 million pounds in the prior year. Total earnings per share increased to 11.1 pence, from last year's 8.3 pence, primarily reflecting the impact on the third-quarter 2014 of the increase to the ViiV Healthcare contingent consideration and the fine payable to the Chinese government. Diluted earnings per share grew to 11.0 pence from 8.2 pence in the prior year.
Total operating profit was 1.025 billion pounds compared with 703 million pounds last year. The non-core items resulted in a net charge of 693 million pounds (1.184 billion last year), reflecting the impact of restructuring costs driven by the Novartis transaction and the Pharmaceuticals restructuring programme as well as the impact of further adjustments related to ViiV Healthcare and Consumer Healthcare.
Core earnings per share of 23.0 pence was down 13% in CER terms compared with a 5% decline in the operating profit primarily as a result of the increased non-controlling interest.
Group turnover for the quarter increased 11% on a reported basis to 6.127 billion pounds, with Pharmaceuticals down 7%, Vaccines up 32% and Consumer Healthcare up 55%, all three businesses reflecting the impact of the Novartis transaction. On a pro-forma basis, Group turnover increased 5%, with Pharmaceuticals up 1%, Vaccines up 13% and Consumer Healthcare up 7%.
The Board has declared a third interim dividend of 19 pence per share, which is unchanged from last year. The ex-dividend date will be 12 November 2015 (10 November 2015 for ADR holders), with a record date of 13 November 2015 and a payment date of 14 January 2016.
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