CSL Provides Trifecta Of Good News
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A trifecta of good news from blood products giant CSL yesterday in its 2017-18 first half report.
More sales, more profits and a higher dividend - a flood of cash and no doubt there will be some sort of major new buyback later in the year.
The company said its half-year net earnings jumped 31% a record $US1.086 billion ($1.375 billion) as it lifted its full year profit guidance and half-year dividend.
Full year net profit is now expected to come in between $US1.55 billion - $US1.6 billion, up from the first forecast of $1.48 billion - $1.55 billion set in August, and up 16% to 19% from last year’s net underlying profit of $US1.34 billion.
The interim dividend is up 23% or 15 US cents at 79¢ US cents a share or $A1.
The shares leap 5% to 414929 after touching an all time high of $150.83.
The company said the strong half-year result was fuelled by rising sales of CSL’s core immunoglobin products, Hizenta and Privigen, which grew 13% from an already high base level in the previous corresponding period when rival suppliers had trouble getting product out.
But the big kicker so far as sales and earnings were concerned were flu injections.
The company reported that sales of its new quadrivalent vaccines (which help protect against four strains of flu) surged 43% in the half, with output from the Holly Springs, North Carolina facility in the US (bought from Novartis three years ago) seeing a 400% jump.
CEO Paul Perreault said the strong results in the flu vaccine division were because its four-strain flu vaccine product is in high demand with consumers in the Northern Hemisphere flu season.
“The big impact this year was the fourfold increase coming out of our Holy Springs facility,” he said.
“The combination of additional doses with a higher-value product has really helped to boost those sales.”
He said the highest risk groups of contracting potentially deadly flu viruses were the young and elderly.
“The younger folks don't have a fully developed immune system, so they’re at higher risk of infection,” he said.
“And the older folks... immune systems start to decline over time.”
He said the company was working on delivering higher-dose flu vaccines in Australia for high-risk patients.
Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.
At the AFR he was a finance writer, Finance Editor, News Editor and Chief of Staff. At the Nine Network he was supervising producer of Business Sunday for more than 16 years. He has also written for other online and analogue print publications here and overseas.