Consolidated income statement for the year ended 31 December 2019

Notes 2019 m 2018 m 2017 m

Turnover 6 33,754 30,821 30,186

Cost of sales (11,863) (10,241) (10,342)

Gross profit 21,891 20,580 19,844

Selling, general and administration (11,402) (9,915) (9,672)

Research and development (4,568) (3,893) (4,476)

Royalty income 351 299 356

Other operating income/(expense) 7 689 (1,588) (1,965)

Operating profit 8 6,961 5,483 4,087

Finance income 11 98 81 65

Finance expense 12 (912) (798) (734)

Profit on disposal of interest in associates 3 94

Share of after tax profits of associates and joint ventures 13 74 31 13 Profit before taxation 6,221 4,800 3,525 Taxation 14 (953) (754) (1,356) Profit after taxation for the year 5,268 4,046 2,169 Profit attributable to non-controlling interests 623 423 637 Profit attributable to shareholders 4,645 3,623 1,532 5,268 4,046 2,169 Basic earnings per share (pence) 15 93.9p 73.7p 31.4p Diluted earnings per share (pence) 15 92.6p 72.9p 31.0p Consolidated statement of comprehensive income for the year ended 31 December 2019 2019 m 2018 m 2017 m Profit for the year 5,268 4,046 2,169 Other comprehensive (expense)/income for the year Items that may be subsequently reclassified to income statement: Exchange movements on overseas net assets and net investment hedges 37 (832) (480) 462 Reclassification of exchange movements on liquidation or disposal of overseas subsidiaries 37 (75) 109 Fair value movements on equity investments (14) Deferred tax on fair value movements on equity investments 47 Reclassification of fair value movements on equity investments (42) Deferred tax reversed on reclassification of equity investments (18) Fair value movements on cash flow hedges (20) 140 (10) Deferred tax on fair value movements on cash flow hedges 16 (22) Reclassification of cash flow hedges to income statement 3 (175) Deferred tax reversed on reclassification of cash flow hedges 20 (908) (517) 534 Items that will not be reclassified to income statement: Exchange movements on overseas net assets of non-controlling interests 37 (75) (1) (149) Fair value movements on equity investments 372 180 Deferred tax on fair value movements on equity investments (95) 10 Remeasurement (losses)/gains on defined benefit plans (1,050) 728 549 Tax on remeasurement of defined benefit plans 189 (146) (221) (659) 771 179 Other comprehensive (expense)/income for the year 37 (1,567) 254 713 Total comprehensive income for the year 3,701 4,300 2,882 Total comprehensive income for the year attributable to: Shareholders 3,153 3,878 2,394 Non-controlling interests 548 422 488 Total comprehensive income for the year 3,701 4,300 2,882 Investor information Financial statements Strategic report Governance

Calculate the Operating Profit % and the Profit After Tax % for 2019 and 2018 for GSK Plc. Comment on the ratios you have calculated and their changes over the two years. (25 marks)

Task C Calculate Gearing and Debt ratios for 2019 and 2018 for GSK Plc. Comment on the ratios you have calculated and the changes over the two years. (25 marks)

Task D 1. What is the Cash Conversion Cycle? 2. Calculate the Cash Conversion Cycle for GSK Plc for the years 2019 and 2018. 3. Comment on the ratios you have calculated and the changes over the two years.