GSK raises long-term profit outlook amid vaccine boost

Drugs giant GSK has upgraded its long-term profit outlook after unveiling higher annual sales and profits thanks to the launch of a new blockbuster vaccine.

The group posted a 14% increase in pre-tax profits on a constant currency basis to £6.1 billion for 2023 after sales rose 5%.

Underlying operating profits were up 12% on a constant currency basis to a better-than-expected £8.8 billion as the company cheered booming sales of Arexvy, its new vaccine for respiratory syncytial virus (RSV), which was authorised in the US last May.

GSK said it expects sales to rise by between 5% and 7% in 2024 and earnings to increase by 7%-10%.

It raised its forecasts for profits growth in 2026, and said it also now expects to notch up sales of more than £38 billion in 2031.

The group predicts sales to grow by more than 7% through to 2026 and underlying earnings by more than 11%.

This compares with previous guidance of more than 5% and more than 10% respectively.

For 2031, GSK increased its original sales guidance by £5 billion to more than £38 billion.

Chief executive Emma Walmsley said: “GSK delivered excellent performance in 2023, with clear highlights being the exceptional launch of Arexvy and continued progress in our pipeline.

“We are now planning for at least 12 major launches from 2025, with new vaccines and specialty medicines for infectious diseases, HIV, respiratory and oncology.

“As a result of this progress and momentum, we expect to deliver another year of meaningful sales and earnings growth in 2024, and we are upgrading our growth outlooks for 2026 and 2031.”

The group saw vaccine sales jump 25% in 2023, including £1.2 billion of sales of Arexvy – the world’s first approved RSV vaccine for older adults.

RSV is generally harmless for most people, showing up as mild, cold-like symptoms. But it can send infants and older adults to hospital with severe cases.

The boost from sales of vaccines and drugs, such as Arexvy, has helped GSK overcome the loss of Covid-19 related treatments.

GSK said it does not expect any further coronavirus-related sales or operating profit this year, which will affect sales growth by 1 percentage point and underlying earnings by two percentage points.