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22 May 2012 - GSK Australia Reports 2011 Results to ASIC

Total profit up to $54m, R&D expenditure up to $58m

GlaxoSmithKline (GSK) reported to the Australian Securities and Investment Commission (ASIC) a total profit before tax of $54m and expenditure of $58m for research and development in 2011.

Profit margins have fluctuated in recent years with last year being impacted by restructuring and other one off costs.

GSK Australia consists of three different businesses - Pharmaceuticals, Consumer Healthcare and Opiates - and employs about 1600 staff across the country. Overall, domestic sales continued to grow in 2011, up by 6% to $968m, export sales however were down to $477m compared to $585m in 2010.

Broken down by business, the total sale of goods in 2011 for Pharmaceuticals was down by 7% (to $1,029m); Consumer Healthcare up by 10% (to $353m) and; Opiates down by 11% (to $63m).

“Our investment in research and development in Australia increased to $58m, up 3% from 2010,” Mr Geoff McDonald, General Manager Pharmaceuticals Australia said.

“That was followed, in February this year, by our announcement of a further $60m investment to expand our Boronia manufacturing site, creating 58 new highly-skilled jobs by 2017.”

“We have a long and proud history in Australia dating back to 1886 and we’re one of the nation’s top 15 investors in local research and development,”

Mr Geoff McDonald, General Manager Pharmaceuticals Australia explained that while overall sales in some areas were down, underlying performance was strong.

“The domestic pharmaceuticals business (the prescription medicines division) produced an improvement in total sales turnover of 3% and underlying growth of 7%. This was due to strong and sustained sales growth in respiratory and vaccines, off-setting the impact of Valtrex® (an antiviral for the treatment of genital herpes infection) coming off patent.”

Mr Vincent Cotard, General Manager Consumer Healthcare Australia & New Zealand said: “The Consumer Healthcare business has continued to build on its solid performance with a further 10% increase in sales revenue in 2011 following the 7% increase in 2010.”

“The key driver of growth for both these years was an increase in demand for Panadol products, in particular Panadol Osteo,” he said.

Mr Steve Morris, General Manager, Opiates Division Australia said, “The Opiates business is largely export driven and, like many others, was heavily impacted by the strong Australian dollar. Storm damage to crop in 2011 further reduced supply already negatively impacted by severe drought from previous years.

“Overall volume growth and customer demand for our products remains strong,” Mr Morris said.

In 2011, GSK Australia was recognized for the third consecutive year as an EOWA Employer of Choice for Women.

GSK’s Global CEO, Sir Andrew Witty at the end of 2011 said "Three and a half years ago, we set out to fundamentally change GSK to create a more balanced business capable of addressing the market challenges we face, delivering sustainable financial performance and providing new value to patients and consumers, “Our record in 2011 demonstrates that we are succeeding.”

Ends

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