GSK's performance is driven by our strategy

Optimising the performance of marketed products
Both the Pharmaceutical and Consumer Healthcare businesses focus on ways to improve the return from the Group's intellectual property by maximising sales of key products. GSK's activities include:

• achieving worldwide sales force excellence
• achieving Pharmaceutical and Consumer Healthcare marketing excellence
• maintaining the highest ethical standards
• improving the cost-effectiveness of operations

• Group turnover was £22.7 billion, up 2% at constant exchange rates compared with 2006
• Top ten Pharmaceutical products:
  Seretide/Advair £3,499 million, up 10%
  Vaccines products £1,993 million, up 20%
  Avandia products £1,219 million, down 22%
  Lamictal £1,097 million, up 18%
  Valtrex £934 million, up 18%
  Imigran/Imitrex £685 million, up 3%
  Flixotide/Flovent £621 million, down 1%
  Coreg £587 million, down 18%
  Seroxat/Paxil £553 million, down 6%
  Augmentin £530 million, down 6%
• Other key pharmaceutical growth drivers, Arixtra, Avodart, Boniva and Requip delivered combined sales of £892 million (up 47%)
• Top five Consumer Healthcare products:
  Lucozade £347 million, up 16%
  Aquafresh £308 million, up 12%
  Sensodyne £293 million, up 16%
  Panadol £262 million, up 14%
  Horlicks £174 million, up 12%
• The launch of alli in the USA in June was very successful, with sales of £150 million achieved
• Business performance operating margin improved by 1.3 percentage points to 34.9% of turnover

Delivering our product pipeline for patients
GSK aims to create the best product pipeline in the industry for the benefit of society. This includes developing a focused strategy to support the pipeline and manage the full life cycle of compounds from launch as prescription medicines through to potentially becoming over-the-counter products.

GSK measures R&D productivity by the number and level of innovation of the products it creates, and by the ability to address unmet patient needs.

• In February 2008, GSK had 157 pharmaceutical and vaccine projects in clinical development, compared with 158 in February 2007
• 34 major product opportunities were in phase III development or registration including:
  elesclomol (metastatic melanoma)
  Entereg (post-operative ileus)
  H5N1 (pandemic flu vaccine)
  ofatumumab (rheumatoid arthritis)
  Promacta (thrombocytopenia)
  Rezonic (chemotherapy-induced nausea and vomiting)
  Synflorix (S. pneumonia and non-typeable Haemophilus influenzae)
  Tykerb + Armala (inflammatory breast cancer)
• Late stage projects terminated included odiparcil for prevention of blood clots

Being the best place for the best people to do their best work
GSK is committed to creating the best place for the best people to do their best work by:

• recruiting and developing the best people in the industry
• supporting a culture of high reward for high performance
• ensuring good communication and employee involvement
• maintaining a diverse and healthy workforce
  

• The Group carries out a global leadership survey of over 10,000 managers every two years
• The last survey in 2006 showed a strong commitment to performance with integrity
• Management has been working since then on addressing the areas for improvement
• The Group is committed to encouraging diversity amongst its employees and in 2007 37% of the global management population was female (2006 - 36%)

Improving access to medicines
GSK is finding innovative ways to bring medicines, vaccines and health education to patients in all countries, including those suffering from epidemics and neglected diseases.

• Global community investment was valued at £282 million, 3.8% of total profit before tax
• The lymphatic filariasis elimination programme continued with another 150 million albendazole treatments donated, making almost 750 million treatments in total
• GSK shipped 13 million Combivir tablets and 72 million Epivir tablets to developing countries at not-for-profit prices.
  Approximately 183 million tablets were supplied by generic manufacturers licensed by GSK
• Other international humanitarian product donations totalled £16 million
  

Maximising total shareholder return (TSR)
GSK continues to work to maximise TSR through EPS growth, dividend increases and share repurchases

• Business performance EPS was 99.1p, up 10% CER
• Total EPS was 94.4p, up 5% CER
• Dividend declared for 2007 of 53p, up 10%
• A new share buy-back programme of £12 billion over two years was announced in July, of which £2.5 billion was spent in 2007 and a further £6 billion is expected in 2008