GSK finances on target but wider picture brings 6% share price drop

There did not appear too much to worry investors in the third-quarter financial results of the UK’s biggest pharma company, GlaxoSmithKline (LSE: GSK), as they were presented on Tuesday.

But something had spooked the markets by the time that they closed, with GSK’s share price down by 6% at £142.35. Talk of a potential bid for the consumer health assets of US drug giant Pfizer (NYSE: PFE) or Germany’s Merck KGaA (MRK: DE) may have caused the dip, with admissions that spending on preparations for Brexit is beginning probably not helping matters.

GSK’s revenue for the quarter, of £7.84 billion ($10.34 billion), was in line with analyst forecasts and 4% up on the same three months in 2016. Adjusted profit before tax increased by 7% to £2.3 billion, which was slightly better than consensus forecasts, as was adjusted earnings per share, at 32.5 pence.