Zeneca Sees Strong Growth Against The Odds

Zeneca Pharmaceuticals has reported strong first-half 1997 results,ahead of expectations, with underlying sales and pretax profit rising by 10% and 22%, respectively. Even after the impact of the pound, earnings per share grew 10% to 47.3 pence.

The group achieved underlying operating profit growth of 18%, with operating profit for the six months to June 30 up to L660 million ($1.08 billion) from L622 million a year earlier (Marketletter August 11). Pretax profits were L669 million, compared with L610 million for the like, year-earlier period, up despite a drop in turnover which was down to L2.75 billion from L2.94 billion in 1996, having been more adversely affected by the strong pound.

According to Sir David Barnes, chief executive, if it had not been for the effects of the pound, sales would have been L300 million more, while pretax profits would have been up another L90 million. Sir David added that "the pound is now at a painful level," but that the company's "hedging of transactional activities had helped mitigate its adverse impact."