Shingles vaccine helps GSK beat earnings forecasts, raise guidance

By Paul Sandle

LONDON (Reuters) - Demand for its new shingles vaccine boosted GlaxoSmithKline's third-quarter earnings on Wednesday and allowed the British drugs firm to nudge its full-year outlook higher.

GSK beat market forecasts with a 14 percent rise in earnings on sales of 8.09 billion pounds ($10 billion), up 6 percent on a constant exchange rate basis and lifting its shares by 1.6 percent to 1,563 pence at 1336 GMT.

The company reported adjusted earnings per shares of 35.5 pence, beating a company-compiled consensus of 33.3 pence.

Chief Executive Emma Walmsley said stronger commercial execution, new launches, notably shingles vaccine Shingrix, and better cost control was driving GSK's growth.

"The performance of our new launches is encouraging and this is where we continue to focus our resources," she said.

"Shingrix continues to have a remarkable start and we have now administered nearly 7 million doses worldwide since launch."

GSK now expects Shingrix sales of 700-750 million pounds this year, up 100 million pounds from the target given in July.

The company narrowed its forecast for full-year adjusted earnings growth to 8-10 percent from 7-10 percent previously, whether or not a generic competitor to its respiratory blockbuster Advair is launched in the United States this year.

Analysts at Liberum, who have a "hold" rating on the stock, said a 1 percent beat on the top line translated to about 6.5 percent on the bottom, driven by lower tax, higher royalties and underlying margin improvement.

But they said the mix was less encouraging, with the newer respiratory products mostly missing forecasts, although on the positive side HIV performed broadly in line with expectations, despite new competition.

GSK declared a 19 pence dividend for the quarter, and said it continued to expect 80 pence for the full year.

($1 = 0.7832 pounds)

(Reporting by Paul Sandle; editing by Kate Holton and Alexander Smith)