Glaxo assures shareholders: Dividend payout secure despite sluggish sales
- GlaxoSmithKline (GSK) stands by its plan to distribute $1.25 per share to investors this year, despite the fact that share prices have fallen 14% this year on news of sluggish respiratory sales..
- GSK's plan has been to distribute 85% of profits in dividends this year—the highest among all pharma companies in the EU and the US.
- Some analysts have warned that given some of the challenges that GSK is facing in the marketplace that it will be difficult for GSK to make good on its dividend promise.
GSK CEO, Andrew Witty, himself, has stepped up to the podium to assure analysts and investors that the promised dividend is secure. Now only are investors getting $1.25 per share, but GSK has also planned to return another $6.26 billion to shareholders upon completion of the deal in which GSK will sell its cancer drugs for $16 billion to Novartis, as well as most of its cancer drugs. In this case, GSK's motto is: "If you say it, do it."