GSK Grows Post-Tax Profit Amid Flat Topline in Q1’20

By Dipo Olowookere

GlaxoSmithKline (GSK) Consumer Nigeria Plc has released its financial statements for the first quarter of 2020, recording a flat topline.

The pharmaceutical company, in its earnings for the first three months of this COVID-19 ridden year, generated N5.0 billion as revenue, the same amount it raked in the corresponding period of last year.

An analysis of the revenue by Business Post showed that the pharmaceuticals arm of the company, which consists of antibacterial, vaccines and prescription drugs, buoyed the earnings for the period, contributing N3.5 billion to the business.

On its part, the consumer healthcare segment consisting of oral care, over-the-counter (OTC) medicines and nutritional healthcare contributed N1.5 billion.

In the comparative period, the two segments contributed exactly what they did in the period under review.

In Q1 of 2020, GSK said its cost of sales reduced to N3.5 billion from N3.7 billion, while the gross profit increased to N1.5 billion from N1.3 billion.

In the same period under review, the investment income, which was the interest earned on short-term deposits, went down to N24.5 million from N57.3 million.

Selling and distribution costs slightly increased to N819.9 million from N800.6 million despite reduction in the advert and promotion cost to N266.7 million from N301.2 million.

Also, the administrative expenses increased during the period under review to N501.5 million from N417.7 million amid a huge slice to the workers’ wages to N217.8 million from N266.9 million.

The increase was majorly influenced by rent and rates (N31.9 million in Q1 2020 versus N11.8 million in Q1 2019), electricity, fuel and utility (N30.6 million in Q1 2020 versus N27.9 million in Q1 2019) and security and facility expenses (N11.3 million in Q1 2020 versus N2.3 million in Q1 2019).

A look at the bottomline showed an increase in the profit before tax to N166.9 million from N150.6 million, while the profit after tax expanded to N113.5 million from N102.4 million.