Pharmaceutical giant GlaxoSmithKline said its 5-year turnaround strategy, which has included painful restructuring and layoffs, was validated Wednesday when the company reported that worldwide drug sales grew 2 percent in the second quarter.
The London-based company, which employs about 4,600 in the Triangle, reported quarterly revenue of $10.2 billion and an after-tax profit of nearly $1.7 billion. Per share earnings were 33.1 cents, meeting expectations of analysts surveyed by Bloomberg News.
The company boosted its dividend and projected solid growth ahead.
But GSK acknowledged in its earnings release that it will "clearly" suffer "some impact to our performance" in China, where Chinese authorities are investigating GSK for running a bribery ring to artificially boost drug prices and defraud the company. The company admitted this week that some of its executives may have broken Chinese law and four senior executives have been detained for questioning.
GSK said its U.S. business was particularly strong in the second quarter, with 5 percent sales growth driven by sales of vaccines and respiratory and oncology medications.
The company continues refocusing its business strategy by selling off what it calls "non-core" assets. GSK is in the midst of selling two nutritional drink brands, Lucozade and Ribena, and is in talks for other possible divestments. Bloomberg News reported that a South African company has offered $1.1 billion for GSK business unit.
"Cash flow generation remains a focus," CEO Sir Andrew Witty said in a statement. "We continue to allocate capital where it can deliver the best returns to shareholders."
GSK said its second-quarter sales were flat in Europe and down 5 percent in Japan.
In this country, GSK reported a 4 percent boost in pharmaceutical sales and a 14 percent increase in vaccines. GSK makes asthma inhalers and bronchiospasm treatments Advair, Flovent and Ventolin, which saw sales increases of 8 percent, 12 percent and 18 percent, respectively.
Advair and Ventolin are produced at GSK's manufacturing facility, which also makes HIV medicines Combivir, Retrovir, Trizivir and Ziagen.
GSK also employs 4,000 at its North American headquarters in Research Triangle Park.