Published at: The Financial Express, February 28, 2019
GlaxoSmithKline Bangladesh’s incurred a huge loss in the year ended on December 31, 2018 because of the closure of its pharmaceuticals unit in the country.
The British drug-maker’s earnings per share (EPS) posted a negative Tk 52.75 for the year ended on December 31, 2018 which was Tk 55.56 in the previous year.
The multinational company also witnessed a negative EPS of Tk 48.64 for the July-September, 2018 against Tk 20.50 in the same quarter a year ago.
The shutting down of the pharmaceutical operations involves a significant amount of costs in terms of severance payment to employees, impairment of non-current assets and inventory write-off and part of these closure cost had been charged in Q3 2018, the drug-maker said earlier through a disclosure posted on Dhaka Stock Exchange (DSE) website.
These expenses affected the financial result of the entity leading to a significant deviation between earnings per share (EPS) and net asset value (NAV), the disclosure said.
Continued losses in recent years forced GlaxoSmithKline to close the medicine manufacturing unit in July, 2018 after more than six decades of operation.
GSK completed the compensation deal with all the employees of the unit. As a result, it had to bear a huge cost in the third quarter, said an official of the company.
He noted that a good amount will be added to the earnings in future from the unit’s assets. “But at first we have to decontaminate the unit”.
GSK Bangladesh, however, would continue with its profitable consumer health care business that produces items like Horlicks, Sensodyne and Glaxose-D.
Meanwhile, the board of directors of the GSK Bangladesh has recommended 530 per cent cash dividend for the year ended on December 31, 2018.
The final approval of dividend will come during the annual general meetings (AGM) scheduled to be held on April 25 at Radisson Blu Chattogram Bay View in Chattogram.