GlaxoSmithKline Pakistan Limited (PSX: GLAXO) reported strong financial results for 2025, posting annual earnings of Rs. 10.025 billion (EPS: Rs. 31.5), up 53 percent year-on-year (YoY).
The company recorded a profit after tax of Rs. 3.8 billion (EPS: Rs. 11.9) in 4Q2025, reflecting an increase of 28 percent YoY and 86 percent quarter-on-quarter (QoQ). According to Topline Securities, this was mainly driven by higher gross margins.
The quarterly result surpassed market expectations due to stronger-than-anticipated margin expansion.
Net sales for 4Q2025 stood at Rs. 21.4 billion, rising 22 percent YoY and 51 percent QoQ. This brought full-year 2025 net sales to Rs. 65.9 billion, up 8 percent YoY, primarily supported by price adjustments and changes in product portfolio mix.
Gross margins improved significantly to 39.5 percent in 4Q2025 compared with 33.2 percent in 4Q2024 and 36.7 percent in 3Q2025. According to IQVIA data, average product prices increased by 17 percent YoY and 4 percent QoQ during the quarter.
Other income declined to Rs. 512 million in 4Q2025, down 64 percent YoY due to lower promotional allowance inflows. Consequently, other income for 2025 reached Rs. 1.4 billion, decreasing 50 percent YoY.
Historically, the company receives the bulk of promotional allowances from its parent company during the fourth quarter. In 4Q2024, promotional allowance amounted to Rs. 1.1 billion, taking the 2024 total to Rs. 2.0 billion.
The company’s effective tax rate stood at 41.0 percent in 4Q2025 compared with 39.9 percent in 4Q2024 and 39.3 percent in 3Q2025. The full-year effective tax rate increased to 39.9 percent versus 34.6 percent in 2024.
Alongside the results, the company announced a cash dividend of Rs. 12 per share for 4Q2025, higher than expectations of Rs. 10 per share. This brings total dividend payout for 2025 to Rs. 17 per share, translating into a payout ratio of 54.0 percent compared with 48.7 percent in 2024.
GLAXO is currently trading at a 2026 estimated price-to-earnings multiple of 9.4x and a 2027 forward price-to-earnings multiple of 8.1x.