RNS Number : 1528C
  GlaxoSmithKline Capital PLC
  27 August 2008
   


 Issued: 27th August 2008, London, U.K.

 GlaxoSmithKline Capital plc


 Results announcement and interim management report for the half year ended
 30th June 2008

 Performance 
 GlaxoSmithKline Capital plc, (the company) a wholly owned subsidiary of
 GlaxoSmithKline plc, provides financial services to its fellow subsidiaries
 ("the Group").  During the period the company made a profit on ordinary
 activities after taxation of �1,043,000 (H1 2007 - �372,000).


 The company had one cross currency swap outstanding with commercial banks at
 30th June 2008.  This was to manage the fixed/floating interest rate profile
 of debt.


 Under its European Medium Term Note (EMTN) programme the company issued a new
 fixed rate bond on 6th March 2008; a 31 year note for �700 million with
 interest fixed at 6.375%. Net proceeds after fees were �693,161,000.  The
 costs will be amortised over the life of the bond.  The issue was not
 swapped.  The funds are to be used for Group financing purposes.


 The company's policy on interest rate risk management requires that the
 amount of net borrowings at fixed rates increases with the ratio of forecast
 net interest payable to trading profit. At 30th Ju
 Outlook
 The Directors are of the opinion that the current level of activity and the
 period end financial position are satisfactory and will remain so in the
 foreseeable future.

 GlaxoSmithKline Capital  plc, 980 Great West Road, Brentford, Middlesex TW8
 9GS, United Kingdom
 Registered in England and Wales  Registered number: 2258699

      
 GlaxoSmithKline Capital plc



 Profit and loss account 

 Six months ended 30th June 2008

                                      Period ended  Period ended   Year ended 
                                         30th June      30th June         31st
                                              2008           2007     December
                                             �'000          �'000         2007
                                                                         �'000
                                            ------         ------       ------
 Net administrative (expense)/income          (76)            55          (75)
 (including foreign exchange gains
 and losses)
                                            ------         ------       ------
 Operating (loss)/profit:                     (76)            55          (75)

 Net interest receivable                    1,771            650        3,026 
                                            ------         ------       ------
 Profit on ordinary activities              1,695            705        2,951 
 before taxation

 Taxation                                    (652)          (333)         408 
                                            ------         ------       ------
 Profit on ordinary activities after        1,043            372        3,359 
 taxation
                                            ------         ------       ------


 Statement of total recognised gains and losses

 Six months ended 30th June 2008

                                      Period ended  Period ended   Year ended 
                                         30th June      30th June         31st
                                              2008           2007     December
                                             �'000          �'000         2007
                                                                         �'000
                                            ------         ------       ------
 Profit for the period                     1,043             372        3,359 

 Fair value movement of cash flow               -         (3,260)      (3,142)
 hedge reserve
 Amount recycled to profit and loss          481             218          387 
 account
 Tax on fair value movement of cash             -            978          942 
 flow hedge
 reserve
 Tax on amount recycled to profit            (144)             -         (116)
 and loss account
 Deferred Tax - effect of tax rate              -              -         (174)
 change
                                            ------         ------       ------
 Total recognised gains and losses          1,380         (1,692)       1,256 
                                            ------         ------       ------

      
 GlaxoSmithKline Capital plc


 Balance sheet

                                         30th June 2008  31st December 2007
                                                  �'000               �'000
                                              ---------           ---------
 Debtors: amounts due after one year         7,096,859           6,812,508 
 Derivative financial assets                   126,470             118,731 
 Cash at bank                                       20                   4 
                                              ---------           ---------
 Current assets                              7,223,349           6,931,243 
                                              ---------           ---------
 Loans due within one year                    (499,861)         (1,233,574)
 Other creditors                              (130,476)            (91,698)
 Derivative financial liabilities                    -                 (83)
                                              ---------           ---------
 Creditors: amounts due within one year       (630,337)         (1,325,355)
                                              ---------           ---------
 Net current assets                          6,593,012           5,605,888 
                                              ---------           ---------
 Total assets less current liabilities       6,593,012           5,605,888 
                                              ---------           ---------
 Loans due after one year                   (6,594,523)         (5,608,779)
                                              ---------           ---------
 Creditors: amounts due after one year      (6,594,523)         (5,608,779)
                                              ---------           ---------
 Net liabilities                                (1,511)             (2,891)
                                                 ------              ------

 Called up share capital                           100                 100 
 Profit and loss account                         4,325               3,282 
 Other reserves                                 (5,936)             (6,273)
                                                 ------              ------
 Equity shareholders' deficit                   (1,511)             (2,891)
                                                 ------              ------


 Reconciliation of movements in equity

                                      Period ended  Period ended   Year ended 
                                         30th June      30th June         31st
                                              2008           2007     December
                                             �'000          �'000         2007
                                                                         �'000
                                            ------         ------       ------
 Equity shareholders' deficit at           (2,891)        (4,147)      (4,147)
 beginning of period
 Profit for the period                      1,043            372        3,359 
 Movement in cash flow hedge reserve          337         (2,064)      (2,103)
 (net of taxation)
                                            ------         ------       ------
 Equity shareholders' deficit at end       (1,511)        (5,839)      (2,891)
 of period
                                            ------         ------       ------
      
 GlaxoSmithKline Capital plc


 Taxation                                         Period ended                                            Period ended   Year ended 
                                                30th June 2008                                           30th June 2007         31st
                                                         �'000                                                    �'000     December
                                                                                                                                2007
                                                                                                                               �'000
                                                          ----                                                     ----         ----
 Tax charge/(credit)                                      652                                                      333         (408)

 Tax rate                                                  28%                                                      30%          30%

 The tax credit in the years to 31st December 2007 arises from the release of an over provision from prior years.
 The effective tax rate is based on the anticipated charge for taxation for the year to 31st December 2008.


 Net interest receivable/(payable)    Period ended  Period ended   Year ended 
                                         30th June      30th June         31st
                                              2008           2007     December
                                             �'000          �'000         2007
                                                                         �'000
 Interest payable                           ------         ------       ------
 Net swap interest income/(expense)         7,327         (1,767)      (2,346)
 Interest on Medium-Term Notes and       (183,788)       (80,777)    (184,874)
 Eurobonds
 Amortisation of bond expenses             (4,018)        (1,968)      (4,368)
 Ineffectiveness on fair value              2,381           (185)         667 
 hedges
                                          --------       --------     --------
                                         (178,098)       (84,697)    (190,921)
 Interest receivable
 Interest receivable on loans with        179,869         85,347      193,947 
 group undertakings
                                          --------       --------     --------
                                            1,771            650        3,026 
                                            ------         ------       ------


 Debtors                                    30th June 2008  31st December 2007
                                                     �'000               �'000
 Amounts due within one year                      --------            --------
 Amounts owed by group undertakings -             388,070           1,116,879 
 loans
 Amounts owed by group undertakings -             113,451              82,351 
 current account
 Deferred tax asset                                 3,751               3,407 
                                                  --------            --------
                                                  505,272           1,202,637 
                                                  --------            --------
 Amount due after one year
 Amounts owed by group undertakings -           6,591,587           5,609,871 
 loans
                                                  --------            --------
                                                7,096,859           6,812,508 
                                                  --------            --------
      
 GlaxoSmithKline Capital plc


 Other creditors              30th June 2008  31st December 2007
                                       �'000              �'0000
 Amounts due within one year        --------            --------
 Taxation                             2,904                 771 
 Other creditors                    127,572              90,927 
                                    --------            --------
                                    130,476              91,698 
                                    --------            --------


 Net debt                                     Period ended  Year ended 
                                                 30th June         31st
                                                      2008     December
                                                     �'000         2007
                                                                  �'000
                                                 ---------    ---------
 Cash at bank                                          20            4 
 Amounts owed by group undertakings - loans     6,979,657    6,726,750 
 Interest rate swaps                                     -       7,333 
 Currency swaps                                   126,470      111,315 
                                                 ---------    ---------
                                                7,106,147    6,845,402 
 Loans due within one year
 Eurobonds and Medium-Term Notes                 (499,861)  (1,233,574)

 Loans due after one year
 Eurobonds and Medium-Term Notes               (6,594,523)  (5,608,779)
                                                 ---------    ---------
 Net debt                                          11,763        3,049 
                                                    ------       ------

 Eurobonds and Medium-Term Notes have increased by �4,018,000 due to the
 amortisation of capitalised bond costs. The cumulative effect at 30th June
 2008 is �20,429,000 (31st December 2007 - �16,411,000).

 A �500million loan repayable in less than one year is swapped to floating
 interest rates. The repayment date is 2nd October 2008.  A EUR 1 billion loan
 outstanding as at 31st December 2007, also swapped to floating rates, matured
 on 15th April 2008.


 Related party transactions


 The company's significant related parties are other members of the
 GlaxoSmithKline group.  Advantage has been taken of the exemption afforded by
 FRS 8 'Related Party Disclosures' not to disclose any related party
 transactions within the Group.  There are no other related party
 transactions.


 Cash flow


 As a wholly owned subsidiary of GlaxoSmithKline plc, advantage has been taken
 of the exemption afforded by FRS 1 'Cash Flow Statements' not to prepare a
 cash flow statement.
      
 GlaxoSmithKline Capital plc


 Accounting presentation and policies


 This unaudited Results Announcement containing condensed financial
 information for the six months ended 30th June 2008 is prepared under UK GAAP
 in accordance with the Listing Rules of the UK Listing Authority,
 pronouncements on interim reporting issued by the Accounting Standards Board
 (ASB) and the accounting policies set out in the company's audited Financial
 Statements 2007.


 This Results Announcement does not constitute statutory accounts of the
 company within the meaning of section 240 of the Companies Act 1985.  The
 balance sheet at 31st December 2007 has been derived from the full accounts
 published in the Financial Statements 2007, which have been delivered to the
 Registrar of Companies and on which the report of the independent auditors
 was unqualified and did not contain a statement under either section 237(2)
 or section 237(3) of the Companies Act 1985.


 Principal risks and uncertainties


 The directors of GlaxoSmithKline plc manage the risks at a Group level,
 rather than at an individual business unit level.  The principal risks and
 uncertainties affecting the company are the same as those which affect the
 Group, and are described under the headings below in the 'Risk Factors'
 section of the 'Business Review' of the GlaxoSmithKline plc Annual Report
 2007.

                                                                                                                                 Risk of
unplanned loss of patents
                                                                                                                                 Risk that
R&D will not deliver commercially successful new
                                                                                                                                 products
                                                                                                                                 Risk of
substantial adverse outcome of litigation and
                                                                                                                                 government
investigations
                                                                                                                                 Risks of
competition, price controls and limitations on sales
                                                                                                                                 Regulatory
controls
                                                                                                                                 Risk of
interruption of product supply
                                                                                                                                 Risk from
concentration of sales to wholesalers
                                                                                                                                 Reliance on
information technology
                                                                                                                                 Taxation
                                                                                                                                 Disruption
from pandemic influenza
                                                                                                                                
Environmental liabilities
                                                                                                                                 Global
political and economic conditions
                                                                                                                                 Accounting
standards
                                                                                                                                 Human
resources

 In particular, policies regarding the management of Group risk pertaining to financial risk, interest rate risk and market risk as well as
liquidity are discussed in the Group's Annual Report
 under the Treasury operations section of the 'Business Review'.


 Directors' responsibility statement


 The Board of Directors approved this document on 27th August 2008.


 The Directors confirm that to the best of their knowledge this unaudited condensed financial information has been prepared in accordance
with pronouncements by the ASB and that the interim
 management report herein includes a fair review of the information required by DTR 4.2.7 and DTR 4.2.8.


 The Directors of GlaxoSmithKline Capital plc are Edinburgh Pharmaceutical Industries Limited and Glaxo Group Limited.

 By order of the Board                                                                                                                      
                                                    
 Paul Blackburn,                                                                                                                            
                                                    
 For and on behalf of Glaxo Group Limited,                                                                                                  
                                                    
 Corporate Director                                                                                                                         
                                                    
                                                                                                                                            
                                                    
 27th August 2008                                                                                                                           
                                                    
                                                                                                                                            
                                                    
                                                                                                                                            
                                                    
                                                                                                                                            
                                                    
 Internet                                                                                                                                   
                                                    
 This Announcement and other information about the GSK Group are available on GSK's website at: http://www.gsk.com.                         
                                                    
                                                                                                                                            
                                                    


This information is provided by RNS
The company news service from the London Stock Exchange
 
  END 
 
IR DGGZRKNVGRZM

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