Dai-ichi Securities / GSK profits Soar in Q3

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"Dai-ichi Securities" - Drugs giant GlaxoSmithKline has announced a big jump in quarterly profits after sales in emerging markets grew by a quarter.

Dai-ichi Securities - British drugs group GlaxoSmithKline, maker of swine flu vaccine Pandemrix, said on Wednesday that net profits rose 30 per cent in the third quarter, aided by the weak pound and a focus on emerging markets.

The group forecast 'further improvement' and 'significant sales' in the fourth quarter due to influenza products that include antiviral drug Relenza.

GSK said in a results statement that net profit surged to 1.335 billion pounds (S$3.05 billion) in the three months to September, compared with the same portion of 2008.

Dai-ichi Securities believe that the strong results were the direct result of the firm diversifying away from a "dependency on white pills and western markets".

Less than 30% of the company's sales were generated from these products and markets, Dai-ichi Securities analysts said.

Sales to emerging markets now represent 14% of total sales, and Glaxo said it was looking for further investment opportunities in those markets.

Last month it signed an agreement to launch Lucozade across China.

Sales in the US, however, fell by 12% due to increased competition from generic drugs. Glaxo said 2010 would, therefore, be a "challenging" year in the US.

Despite a weak performance in the US, the company is said to have told Dai-ichi Securities it expects to see further overall sales growth in the final three months of the year, including "significant" sales of flu products.