Gsk Plc · LSE:GSK
Gsk — Q3 2021 Earnings Presentation
31 slides from Gsk's earnings presentation, Oct 27, 2021
Slide 1: Q3 2021 results
Q3 2021 results 27 October 2021
Slide 2: Cautionary statement regarding forward-looking statements
Cautionary statement regarding forward-looking statements This presentation may contain forward-looking statements. Forward-looking statements give the Group’s current expectations or forecasts of future events. An investor can identify these statements by the fact that they do not relate strictly t
Slide 3: Agenda
Agenda Q3 2021 progress Emma Walmsley Luke Miels Growth drivers Deborah Waterhouse Brian McNamara Q3 2021 financial results Iain Mackay Dr Hal Barron Q&A Roger Connor David Redfern 3
Slide 4: Q3 2021 progress
Q3 2021 progress Emma Walmsley
Slide 5: Q3 2021: Continued business momentum
Q3 2021: Continued Strong Q3 2021: sales +10%, Adjusted EPS +10% business momentum; Pharmaceuticals (+10%), Vaccines (+13%) and Consumer Healthcare (+8%) accelerating New and Specialty medicines +24% execution of strategic priorities Cost discipline supported the performance Full year 2021 Adjusted
Slide 6: Continued progress across all three strategic priorities
Continued progress across all three strategic priorities HIV: collaboration on Jemperli1: US FDA Cabotegravir: US ultra long-acting 3rd accelerated approval FDA Priority Review gen integrase inhibitor Innovation Nucala: EMA positive Daprodustat: Xevudy: agreements CHMP for HES2, Phase III data at AS
Slide 7: R&D pipeline: Upcoming select late-stage milestones
R&D pipeline Upcoming select late-stage milestones H2 2021 2022 Regulatory decisions Shingrix - immuno-compromised cabotegravir - HIV PrEP: H1 2022 Jemperli^ - dMMR/MSI-H solid tumours MMR - vaccine (US): mid 2022 Nucala - nasal polyposis Menveo liquid: H2 2022 Regulatory Menveo liquid Rotarix (liqu
Slide 8: Progressing towards demerger at pace
Progressing towards demerger at pace Step-change in growth and GSK plans to demerge at least 80% of GSK performance holding to shareholders. Remaining stake up to 20% to be monetised in timely manner • Expected sales growth >5% and Key timelines New GSK adj. operating profit growth >10% CAGR 2021-26
Slide 9: Growth drivers
Growth drivers Luke Miels Deborah Waterhouse Brian McNamara
Slide 10: New and Specialty: strong double-digit growth in Q3 2021
New and Specialty: strong double-digit growth (+24% CER) in Q3 2021 Trelegy: £326m +77% CER Nucala: £285m +20% CER Market shares (MQT2) in IL-5 inhibitors3 Share of US triple therapy patients (COPD)1 – 73% global share – Leading biologic for eosinophilic-driven 60% diseases across key markets 53% 10
Slide 11: Vaccines: performance in Q3 2021 driven by Shingrix
Vaccines: performance1 in Q3 2021 driven by Shingrix Q3 2021: Shingrix sales £502m +41% at CER US Shingrix total prescription trends improving • US: growth from inventory comparisons and non-retail channel US weekly TRx 2021 vs. 2020 • Retail recovery underway but delayed by surge in delta 350,000 v
Slide 12: HIV: delivering sustainable mid-single digit growth
HIV: delivering sustainable mid-single digit growth Dovato switch share expansion in EU and US Key growth drivers Dovato • Dovato leading share of switch in EU • On track to reach >£1bn in 2022 with further potential beyond Cabenuva • >80% market access in the US • >2,000 PLHIV taking Cabenuva • Pot
Slide 13: Consumer Healthcare: Q3 2021 sales +10%
Consumer Healthcare: Q3 2021 sales +10%1 Good category performance reflecting strong execution Performance Continuing business growth • Continuing sales1 Q3 +10% (+3% Q3 20202) in Q3 2021 and YTD 2021 • Strong performance across all categories • 2% benefit from impact of cutover in US last year Grow
Slide 14: Q3 2021 results
Q3 2021 results Iain Mackay
Slide 15: Headline results
Headline results Reported Reported Q3 2021 YTD 2021 % % £m AER CER £m AER CER Turnover 9,077 5 10 24,587 (3) 3 Total operating profit 1,938 4 15 5,306 (21) (11) Total EPS 23.3p (7) 3 72.7p (29) (19) Adjusted operating profit 2,874 8 16 6,913 (2) 8 Adjusted EPS 36.6p 3 10 87.7p (5) 5 Free cash flow 1
Slide 16: Results reconciliation Q3 2021
Results reconciliation Q3 2021 Disposals, significant Total Intangible Intangible Major Transaction legal and Separation Adjusted results amortisation impairment restructuring related other costs results Turnover 9.1 9.1 (£bn) Operating 1.9 0.2 0.3 0.1 0.3 <(0.1) 0.1 2.9 profit (£bn) EPS 23.3 3.4 4.
Slide 17: Group sales and adjusted operating margins Q3 2021
Group sales and adjusted operating margins Q3 2021 Sales Adjusted operating margin All figures £m Q3 2020 sales at ’20 rates 8,646 Q3 2020 margin 30.8% Pharma up +10% CER 433 COGS up +7% CER 0.8% Vaccines up +13% CER 259 SG&A up +7% CER 1.0% +1.5% CER Consumer up +8% CER 189 R&D up +15% CER 0.6% Cor
Slide 18: Adjusted operating profit to net income
Adjusted operating profit to net income Q3 2020 Q3 2021 £m £m Operating profit 2,665 2,874 Net finance expense (197) (192) Share of associates 11 3 Tax (417) (554) Tax rate 16.8% 20.6% Non-controlling interests (287) (296) Net income 1,775 1,835 18
Slide 19: Free cash flow of £1.5bn
Free cash flow of £1.5bn Key drivers £m Adverse exchange impacts YTD20 free cash flow 2,300 Adverse timing of RAR5 Lower CCL1 33 Increased adjusted operating profit at CER Lower net operating cash2 400 Favourable comparative timing of tax payments Higher net Capex3 963 Increased purchases of intangi
Slide 20: Pharmaceuticals Q3 2021
Pharmaceuticals Q3 2021 Sales Operating profit and margin Sales factors All figures £m Q3 2021 Total : £4,397m: +10% CER; +5% AER New and Specialty growth +260 bps CER +140 bps AER +24% CER Favourable US return and rebate +18% AER -4% CER -8% AER 29.4% adjustments 2,475 28.0% 2,093 2,099 Xevudy 241
Slide 21: Vaccines Q3 2021
Vaccines Q3 2021 Sales Operating profit and margin Sales factors All figures £m Q3 2021 Total : £2,174m: +13% CER; +7% AER Shingrix +360 bps CER +330 bps AER +8% CER +2% AER Pandemic adjuvant sales 47.5% 2,032 2,079 44.2% Unfavourable US RAR adjustments 384 related to influenza 445 374 502 363 352 1
Slide 22: Consumer Healthcare Q3 2021
Consumer Healthcare Q3 2021 Sales Operating profit and margin Sales factors All figures £m Good underlying performance across Q3 2021 Total : £2,506m: +8% CER; +3% AER +420 bps CER portfolio +350 bps AER +10% CER 2% points benefit from adverse +6% AER 25.9% systems cutover impact Q3 2020 2,471 2,342
Slide 23: 2021 outlook: Improving adjusted EPS guidance to -2% to -4%
2021 outlook Improving adjusted EPS guidance to -2% to -4% Q4 2021: considerations 2021: updated expectations Pharma sales: trends anticipated to continue Pharma sales: low-single digit increase, excl. Xevudy Vaccines sales: trend in adult vaccination rate stable; Vaccines sales: mid-single digit de
Slide 24: Appendix
Appendix
Slide 25: Our R&D pipeline
Our R&D pipeline 63 potential vaccines and medicines Phase I Phase II Phase III/Registration C. difficile* vaccine Malaria (fractional dose)* vaccine Bexsero infants (US) vaccine Infectious Diseases Klebsiella pneumoniae* vaccine S. aureus*1 vaccine COVID-19 (Medicago)*Ɨ vaccine HIV (ViiV) SAM (COVI
Slide 26: R&D pipeline: Upcoming select late-stage milestones
R&D pipeline Upcoming select late-stage milestones H2 2021 2022 Regulatory decisions Shingrix - immuno-compromised cabotegravir - HIV PrEP: H1 2022 Jemperli^ - dMMR/MSI-H solid tumours MMR - vaccine (US): mid 2022 Nucala - nasal polyposis Menveo liquid: H2 2022 Regulatory Menveo liquid Rotarix (liqu
Slide 27: Our R&D pipeline: Changes in the portfolio since Q2 2021
Our R&D pipeline Changes in the portfolio since Q2 2021 New to Phase I New to Phase II New to Phase III New to Registration GSK1070806 (IL18 neutralizing antibody) MenABCWY (2nd gen) vaccine COVID-19 (SK Bioscience) vaccine cabotegravir – HIV PrEP atopic dermatitis1 linerixibat (IBAT inhibitor) - ch
Slide 28: 2021 outlook
2021 outlook Adjusted EPS/Dividend Adjusted operating costs Other Adjusted financials Adjusted EPS guidance: Adjusted SG&A and R&D: Royalties: -2% to -4% at CER, excl. COVID-19 solutions Tight cost control, with targeted Between £300-350m COVID-19 solutions expected to contribute investments, and re
Slide 29: Zejula: COVID-19 continues to impact ovarian cancer diagnosis and treatment
Zejula: COVID-19 continues to impact ovarian cancer diagnosis and treatment Ovarian cancer diagnoses down c.16% Debulking surgeries down c.4% below 2019 monthly averages1 below 2019 monthly averages1 US Newly Diagnosed Ovarian Cancer Patients2 2,500 7M 2,295 350 328 7M 312 2,113 303 2,083 Monthly Av
Slide 30: Consumer Healthcare: strong quarterly growth, building momentum
Consumer Healthcare: strong quarterly growth, building momentum after pandemic related volatility Q3 2021 Performance now stabilising after pandemic-related • Strong growth in Sensodyne and Gum health, Denture volatility1 care flat 14 • Good growth in Pain; particularly Panadol, Advil and 14 10 Exce
Slide 31: Expected costs and savings under Major Restructuring Programmes & Consumer Separation
Expected costs and savings under Major Restructuring Programmes & Consumer Separation Q3 YTQ3 YTD Cumulative 2021 2022 2023 2024 Date 2021 2021 2021 £bn Actuals to Announced 2020 Total Actuals Actuals Projected 1 Lifetime 2018 Savings 2 0.3 - 0.4 0.5 0.5 Restructuring Q2’18 Total charges 1.5 - - 0.1