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Highlights
- The global healthcare company has reported £34 billion sale in its 2021 full-year results as it saw significant growth across its vaccines, pharmaceutical, and customer healthcare divisions.
- The company reported a 9% hike in its adjusted operating profits, with earnings of £8.8 billion for the entire year.
British pharmaceutical giant GlaxoSmithKline Plc (LON: GSK) is back in the news after the company reported robust results for the year 2021 before the structured disposal of its consumer healthcare division. The company reported a 9% hike in its adjusted operating profits, with earnings of £8.8 billion for the entire year. Its annual profit before tax fell to £5.1 billion, from £6.4 billion in 2020.
The global healthcare company researches and develops a range of products in three primary areas: vaccines, pharmaceuticals, and consumer healthcare. Let’s analyse if GlaxoSmithKline shares are worth buying.
Final result update
The global healthcare company has reported £34 billion sales in its 2021 full-year results as it saw significant growth across its vaccines, pharmaceutical and customer healthcare divisions. Sales of Covid-19 solutions alone contributed around 4% points to growth in the year.
Pharmaceutical sales stood at £17.7 billion, up by 4%, largely driven by the sales of Xevudy, the monoclonal antibody treatment for COVID-19 of £958 million in the entire year that contributed around 6% to total pharmaceuticals growth.
Vaccine sales stood at £6.8 billion, down by 3%, primarily driven by the pandemic adjuvant sale of £447 million and partially offset by lower demand for routine adult vaccination programme deployment and disease circulation across regions. Consumer Healthcare segment turnover stood at £9.6 billion, down by 4%.
The operating profit of GlaxoSmithKline stood at £6.2 billion for the year 2021 as compared to £7.8 billion in 2020, as it indicated the resultant sale of shares in Hindustan Unilever and unfavourable comparison to the net profit on disposal in the second quarter of 2020 of Horlicks and other consumer brands.
The company reported a 22% fall in pre-tax profits to £5.4 billion in year 2021 despite £1.4 billion covid related sale.
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Outlook for 2022
In 2022, GlaxoSmithKline aims to increase its investment in R&D for seven key late-stage pipeline assets and to demerge and separate its London-listed consumer healthcare arm by June this year, which would include brands such as Panadol pain relief and Sensodyne toothpaste.
The company’s consumer healthcare business is a joint venture with US-based rival Pfizer that had received a £50 billion takeover bid from Marmite maker Unilever. But it was later rejected by the GSK for being undervalued.
The company expects its 2022 sales to grow between 5% and 7% and adjusted operating profit to grow between 12% and 14% as compared to 2021 on a constant currency basis.
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Share performance
GlaxoSmithKline Plc is one of the largest pharmaceutical companies in the world with dual listing on London Stock Exchange (LON: GSK) and New York Stock Exchange (NYSE:GSK). The healthcare giant currently has 21 vaccines and 43 medicines in its development pipeline.
The market cap of the FTSE100-listed global healthcare company stands at £82,736.49 million and it has provided its shareholders with a positive return of 26.92% in the last one year as of 9 February 2022, while its year-to-date return stands at 0.88%. GlaxoSmithKline’s shares closed trading at GBX 1,620.80 on 9 February 2022.
