Strong Sterling Impacts SmithKline Beecham

SmithKline Beecham said that currency exchange had a negative impact of12% on its pretax profits in the second quarter of 1997, and the effect on earnings per share was a negative of 13%. However, it stressed the strength of its underlying growth, which seemed to please investors; the firm's share price advanced 49 pence to L12.20 ($20.58) in the initial market reaction to the interim figures.

Second-quarter pretax profits were L356 million ($581 million), which reflected an advance of 4%, or 16% excluding currency. EPS was 8.4 pence, up 1% or 14% excluding currency fluctuations. Trading profit was L377 million, rising 2%, or 14% without the currency impact.

SB experienced a decline in group sales in the quarter of 1% to L1.9 billion, although they rose 8% when stripped of the currency effect. The company said that pharmaceutical products increased 15% in the quarter, while turnover of consumer health care products advanced 14%.