GSK (GSK) Q4 2023 earnings summary

Executive summary

• FY 2023 sales grew 14% CER excluding COVID-19 solutions; adjusted operating profit rose 16% and adjusted EPS 22% on the same basis.

• Growth spanned Vaccines, Specialty Medicines and General Medicines, with Vaccines and Specialty reaching 66% of sales.

• Outlooks were upgraded: 2021-26 sales CAGR to >7% and adjusted operating profit CAGR to >11%; 2031 sales ambition increased to £38bn.

Financial highlights

• FY sales were £30.3bn, up 5% AER and 14% CER excluding COVID-19 solutions; reported CER sales growth including COVID-19 solutions was 5%.

• Adjusted operating profit was £8.8bn, up 12% AER and 16% CER excluding COVID-19 solutions; adjusted EPS was 155.1p, up 16% AER and 22% excluding COVID-19 solutions.

• Dividend per share was 58p; FY 2023 total operating profit was £6.745bn and total EPS 121.6p.

• New products launched since 2017 generated £11bn sales; FY 2023 Arexvy sales were £1.238bn.

Outlook and guidance

• 2024 CER guidance, excluding COVID-19 solutions: sales growth 5-7%, adjusted operating profit growth 7-10% and adjusted EPS growth 6-9%.

• 2024 product-area expectations: Vaccines high-single- to low-double-digit growth; Specialty Medicines low-double-digit; HIV high-single- to low-double-digit; General Medicines mid-single-digit decline.

• 2021-26 outlook raised to >7% sales CAGR, >11% adjusted operating profit CAGR, >31% adjusted operating margin and >£10bn cash generated from operations.

• 2031 sales outlook raised to >£38bn risk-adjusted; >90% is from approved products or planned launches, mostly planned within four years.

• Through dolutegravir loss of exclusivity in 2028-30, adjusted operating margin is expected to remain broadly stable; 2024 dividend expectation is 60p/share.