Slide 1: Half year and Q2 2023 results
26 July 2023 Half year and Q2 2023 results Conference call and webcast for investors and analysts gsk.com
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 Strong performance drives momentum Emma Walmsley Innovation Dr Tony Wood Performance Luke Miels, Deborah Waterhouse and Julie Brown Trust Emma Walmsley Q&A Emma Walmsley, Tony Wood, Luke Miels, Deborah Waterhouse, Julie Brown, David Redfern 3
Slide 4: Strong performance drives momentum
Strong performance drives momentum Emma Walmsley, Chief Executive Officer 4
Slide 5: H1 2023 Q2 2023 performance
H1 2023 Q2 2023 performance Momentum drives upgraded Sales Adj. operating profit guidance £7.2bn, +4% £2.2bn, +11% +11% 1 +12% 1 Delivered 11%1 sales growth, 9%1 adj. operating profit growth Profitable, resilient growth across portfolio: Adj. EPS Dividend per share • Vaccines 12%1 38.8p, +16% +17% 1
Slide 6: Delivering our commitments for attractive medium-term growth
Delivering our commitments for attractive medium-term growth On track with continued organic and business development progress Pipeline 2021-2026 outlook Metric On track • Arexvy: US FDA and EMA approved RSV1 Sales >5% CAGR vaccine for older adults • MenABCWY: preliminary pivotal phase III data pres
Slide 7: Strong momentum supports confidence in short, medium and long-term commitments
Strong momentum supports confidence in short, medium and long-term commitments to profitable growth Full-year 2023 guidance1 2021-2026 outlook1 2031 ambition Sales growth Sales CAGR Sales 8-10% >5% >£33 billion Adj. operating profit growth Adj. operating profit CAGR 11-13% >10% Adj. EPS growth 14-17
Slide 8: Innovation
Innovation Dr Tony Wood, Chief Scientific Officer 8
Slide 9: Three key R&D priorities
Three key R&D priorities Uniting science, technology and talent to get ahead of disease together Science of the immune system and advanced technologies Execution Technology Culture Focus on pipeline acceleration Using platform and data Building a culture that is and complementary business technology
Slide 10: Effective capital allocation to support R&D investment priorities
Effective capital allocation to support R&D investment priorities Invest for growth Pipeline New product launches Organic R&D portfolio and targeted Business Development Criteria: First-in-class or best-in-class, probability of success, commercial potential, and risk/return, technology enabled Infec
Slide 11: Four focused therapeutic areas
Four focused therapeutic areas Two thirds of our development portfolio comes from infectious diseases and HIV Infectious Respiratory/ HIV Oncology Diseases Immunology Pioneering novel platform technologies to help prevent and treat seasonal respiratory Slow disease progression, address Seeking solut
Slide 12: 68 assets in clinical development: upcoming pipeline catalysts
68 assets in clinical development: upcoming pipeline catalysts H2 2023 H1 2024 H2 2024 Regulatory decision Arexvy RSV, ≥60 YoA (JP) momelotinib MOMENTUM, myelofibrosis (EU, JP) Jemperli RUBY 1L dMMR/MSI-H endometrial cancer Arexvy, RSV, 50-59 YoA (US, EU, JP) gepotidacin EAGLE-2/3, uUTI (US, EU) (EU
Slide 13: Continuous improvement in R&D productivity
Continuous improvement in R&D productivity Enabled by advanced technology and partnerships R&D success rates1 in phase II have improved to median with phase III and End to end cycle times have improved by 20% registration upper quartile, three-year rolling trend compared to industry median since 201
Slide 14: Performance: growth drivers
Performance: growth drivers Luke Miels, Chief Commercial Officer Deborah Waterhouse, CEO, ViiV Healthcare and President, Global Health 14
Slide 15: Continued strong commercial execution
Continued strong commercial execution Q2 2023 growth across all product areas and all regions Sales contribution by product area1 Sales contributions by region1 Vaccines Specialty Medicines General Medicines US Europe International 8,000 8,000 7,000 7,000 6,000 6,000 +17% +8% 5,000 5,000 Sales (£m)
Slide 16: Q2 2023 sales £7.1bn, +11%
Q2 2023 sales £7.1bn1, +11%1 Strong commercial execution across all product areas and key medicines Vaccines +15%1 Specialty Medicines +12%1 General Medicines +8% • Shingrix +20%: another record • Benlysta +19% • Trelegy +30%: best-in-class access with quarter with continued growth ex-US; • Nucala +
Slide 17: Arexvy approved ahead of 2023/24 RSV season
Arexvy approved ahead of 2023/24 RSV season Adults aged 60 and older can be protected from RSV disease for the first time Exceptional efficacy for US CDC recommends Arexvy Launch preparations patients aged 60 years or older for upcoming RSV season2 progressing as planned Efficacy against RSV LRTD in
Slide 18: HIV +12% growth in Q2 2023 driven by oral 2DR and long-acting regimens
HIV +12% growth in Q2 2023 driven by oral 2DR1 and long-acting regimens Strong commercial execution across HIV Growth driven by oral 2DR and long-acting portfolio regimens 1000 60% • Sales: £1.6bn in Q2 2023 with all regions driving growth 900 51% • Total portfolio: oral 2DR and LA regimens now 51%
Slide 19: Performance: CFO priorities, capital allocation and financial results
Performance: CFO priorities, capital allocation and financial results Julie Brown, Chief Financial Officer 19
Slide 20: Capital allocation framework
Capital allocation framework The priority is to invest for growth, coupled with attractive shareholder returns Sustainable, profitable growth & cash generation 1 2 Invest for growth Shareholder distributions +17% +8% BD) Pipeline (organic & targeted Progressive dividend (40-60% pay-out ratio) New pr
Slide 21: Delivered a strong Q2 2023 financial performance
Delivered a strong Q2 2023 financial performance Q2’22 Q2’23 AER CER Key commentary Adjusted results £m £m % % Sales 6,929 7,178 4 4 Sales grew +11% excluding COVID-19 solutions Cost of goods sold (1,970) (1,728) (12) (12) Benefit from lower sales of low-margin Xevudy Gross profit 4,959 5,450 10 11
Slide 22: Improved Q2 2023 adj. operating margin by 200 bps at CER
Improved Q2 2023 adj. operating margin by 200 bps at CER Improved 20 bps at CER excluding COVID-19 solutions Key Lower COGS due to Growth ahead of Growth ahead of Benefit from Gardasil, lower sales of low- sales, with investment sales, progressing Kesimpta and Biktarvy drivers margin Xevudy behind p
Slide 23: Efficient delivery of profit attributable to shareholders
Efficient delivery of profit attributable to shareholders Q2 2022 Q2 2023 Key commentary £m £m Operating profit (OP) 2,008 2,170 +11% at CER (+12% at CER excluding COVID-19 solutions) Higher interest income and lower bond interest costs; Net finance expense (181) (152) [expect £700-750m in FY23] Sha
Slide 24: Q2 2023 Total to adjusted profit reconciliation
Q2 2023 Total to adjusted profit reconciliation Q2 2022 Q2 2023 Key commentary Operating profit Operating profit (£m) (£m) Total results 1,081 2,141 Intangible amortisation 192 184 Intangible impairment 55 4 Major restructuring 134 46 Transaction-related 685 (189) ViiV CCL1 movements, primarily rela
Slide 25: H1 2023 free cash outflow of £0.3bn
H1 2023 free cash outflow of £0.3bn Cash generated from operations of £1.9bn As at 31 As at 30 Dec 2022 Jun 2023 Net debt (17,197) (18,220) 1. Cash generated from operations, including changes in working capital, Significant Legal payments and operating contingent consideration liability 2. Net Cape
Slide 26: 2023 guidance upgraded
2023 guidance upgraded1 2023 guidance1 2023 sales guidance composition1 Vaccines Mid-teens % growth Sales 8% to 10% growth Speciality Medicines2 High single-digit % growth Adj. operating profit 11% to 13% growth HIV High single-digit % growth Adj. earnings per share 14% to 17% growth General Medicin
Slide 27: Investor roadmap over next 18 months
Investor roadmap over next 18 months Q2 2023 Q3 2023 Q4 2023 H1 2024 H2 2024 Execution • Q2 and Half-year • Q3 and Year-to-date • Full-year and Q4 2023 • Q1 2024 results • Q3 and Year-to-date 2024 results 2023 results 2023 results results • Q2 and Half-year 2024 results • Full-year and Q4 2024 resul
Slide 28: Trust: delivering health impact sustainably
Trust: delivering health impact sustainably Emma Walmsley, Chief Executive Officer 28
Slide 29: Purpose: to get ahead of disease together
Purpose: to get ahead of disease together For health impact, shareholder returns and thriving people Six priority areas to build trust Key highlights Access • In July, Gavi announced the first nine new countries to be allocated doses of the RTS,S/AS01E vaccine against malaria from early 2024 Access
Slide 30: A focused global biopharma company with momentum and bold ambitions
A focused global biopharma company with momentum and bold ambitions Strategy focused on World leader in Highly attractive Confident in ability to prevention and infectious disease with a medium-term1 target for sustain profitable treatment to get ahead broader pipeline based sales and adjusted growt
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Slide 32: Appendix
Appendix 32
Slide 33: 2023 full year outlook considerations to support modelling
2023 full year outlook considerations to support modelling Vaccines turnover Specialty Medicines turnover General Medicines turnover Increase mid-teens %, excluding pandemic adjuvant Increase high single-digit % for Specialty Medicines, Increase low single-digit % sales excluding Xevudy sales Shingr
Slide 34: Continuing operations basis for guidance
Continuing operations basis for guidance 2022 2023 Q1 Q2 Q3 Q4 FY Q1 Q2 Including COVID-19 solutions Sales (£m) 7,190 6,929 7,829 7,376 29,324 6,951 7,178 Operating profit (£m) 1,943 2,008 2,605 1,595 8,151 2,092 2,170 Earnings per share (pence) post- 32.3 34.7 46.9 25.8 139.7 37.0 38.8 share consol
Slide 35: Currency
Currency 2022 currency sales exposure1 2023 adj. operating profit US $ 48% US $: 10 cents movement in the average exchange rate for full year impacts adj. operating profit by approx. +/- 8.0% Euro € 17% Euro €: 10 cents movement in the average exchange rate for full year impacts adj. operating profi
Slide 36: Upcoming pipeline catalysts: 2023 and 2024
Infectious disease Infectious diseases HIV (ViiV) Respiratory/Immunology Upcoming pipeline catalysts: 2023 and 2024 Oncology Opportunity driven H2 2023 H1 2024 H2 2024 Jemperli1 – RUBY, dMMR/MSI-H 1L endometrial cancer US Jemperli1 – RUBY, dMMR/MSI-H 1L endometrial cancer EU Nucala – severe asthma C
Slide 37: 68 potential new vaccines and medicines in pipeline: Phase I
Infectious disease Infectious diseases HIV (ViiV) Respiratory/Immunology 68 potential new vaccines and medicines in pipeline Oncology Opportunity driven Phase I – 32 assets 2904545 Recombinant protein, adjuvanted* C. difficile 4429016 Bioconjugated recombinant protein, adjuvanted* K. pneumoniae 3993
Slide 38: 68 potential new vaccines and medicines in pipeline: Phase II
Infectious disease Infectious diseases HIV (ViiV) Respiratory/Immunology 68 potential new vaccines and medicines in pipeline Oncology Opportunity driven Phase II – 19 assets 3437949 Recombinant protein, adjuvanted* Malaria fractional dose 4406371 Live, attenuated MMRV new strain 3536852 GMMA* Shigel
Slide 39: 68 potential new vaccines and medicines in pipeline: Phase III / Registration
Infectious disease Infectious diseases HIV (ViiV) Respiratory/Immunology 68 potential new vaccines and medicines in pipeline Oncology Opportunity driven Phase III / Registration – 17 assets Arexvy (RSV vaccine) Recombinant protein, adjuvanted* RSV older adults^8 gepotidacin (2140944) BTI inhibitor*
Slide 40: Changes since Q1 2023
Infectious disease Infectious diseases HIV (ViiV) Respiratory/Immunology Changes since Q1 2023 Oncology Opportunity driven Changes on pipeline Achieved pipeline catalysts New to Phase II Regulatory submissions & acceptances 4348413 – GMMA, gonorrhea Jemperli 1 – RUBY, dMMR/MSI-H 1L endometrial cance
Slide 41: Glossary
Glossary ADC Antibody drug conjugate EGPA Eosinophilic granulomatosis with polyangiitis NSCLC Non-small cell lung cancer AE Adverse event FVC Forced vital capacity OMV Outer membrane vesicle AESI Adverse event of special interest GC Urogenital gonorrhea ORR Overall response rate AUC Area under curve
Slide 42: Use of GSK conference call, webcast and presentation slides
Use of GSK conference call, webcast and presentation slides The GSK plc webcast, conference call and presentation slides (together the ‘GSK materials’) are for your personal, non-commercial use only. You may not copy, reproduce, republish, post, broadcast, transmit, make available to the public, sel
Slide 43: gsk.com
gsk.com