GSK upgrades profit outlook after sales rise 5% thanks to vaccine boost

31 January 2024 , 12:02

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GSK has upgraded its long-term profit outlook after unveiling higher annual sales (Image: PA Archive/PA Images)

Pharma giant GSK has given its earnings outlook a boost because of robust annual sales and profits driven by the launch of a new star vaccine.

The business reported a 14% surge in pre-tax profits to £6.1 billion in 2023, with sales increasing by 5%. Soaring profits came from ongoing strong sales of Arexvy, a new vaccine for respiratory syncytial virus (RSV), which got the green light in the US last year. The company has raised its expectations of profit growth for 2026. GSK is forecasting that sales will grow between 5% and 7% in 2024, with earnings expected to rise between 7%-10%. It now anticipates achieving over £38 billion in sales by 2031.

Comparing it with previous forecasts, the group expects sales to grow by more than 7%, up from 5%, and earnings by more than 11%, up from 10% through to 2026. For 2031, GSK hiked its original sales guidance by £5 billion to reach the whopping £38 billion mark. CEO Emma Walmsley said: "GSK delivered excellent performance in 2023, with clear highlights being the exceptional launch of Arexvy and continued progress in our pipeline."

She added: "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.

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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.

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Lawrence Matheson