Shares in blood and drugs group, CSL closed up 1% yesterday after the annual meeting was told the company was planning another share buyback.
At the same time the company reaffirmed previous profit guidance for this year for a 10% rise in earnings, subject to what currencies do.
But shareholders were told that the company was trading in line with its expectations.
The news share the shares jump 2% to a high for the day of $30.86 before the enthusiasm waned and they eased to close up 29c at $30.50.
"CSL will conduct a further on market buyback of up to $900 million, which we intend to complete over the next 12 months," CSL chairman Elizabeth Alexander told shareholders.
"At the end of the first quarter of the current financial year, I can advise the company is trading consistently with our expectations," chairman Elizabeth Alexander told the meeting.
At the Tuesday’s closing price of $30.21, the buyback represents approximately 30 million CSL shares, or 6% of the company’s issued capital.
"Through these buybacks, our shareholders benefit from improved investment return ratios, such as earnings per share and return on equity," Ms Alexander said.
In August 2010, CSL announced its intention to conduct an on-market share buyback of up to $900 million. This buyback saw the company purchase around 26.1 million shares.
"When announcing our full year result in August, we anticipated solid growth of approximately 10 per cent in reported profit, using fiscal 2011 exchange rates. We reaffirm this guidance."
The strength of the Swiss Franc against the US dollar, which affects earnings from CSL’s operations in Switzerland, is continuing to have a significant impact, Ms Alexander said.
On current rates, CSL expects a negative foreign exchange impact on earnings of about $85 million in the 2012 financial year, she said.
That will be down sharply from the $116 million impact in the 2010-11 financial year which trimmed earnings to $941 million.
Ms Alexander revealed yesterday that CSL was close to finalising negotiations with its banks for new lines of credit for up to the equivalent of approximately $750 million Australian Dollars, at current exchange rates.
"These lines of credit will be denominated in US Dollars, Euros and Japanese Yen and are at very competitive floating interest rates over five year terms.
“CSL has, subject to final documentation and closing, also placed $750 million US Dollars under a US private placement. This placement was well received by investors and was significantly oversubscribed."
"These new funds will be used to repay existing debt, to fund CSL’s capital management plan and for general corporate purposes and the lines of credit will be drawn down progressively on an as required basis."
CSL had $479 million in cash and $416 million in debt at June 30 this year.
And online travel agency Webjet has confirmed earlier guidance that the 2012 financial year has started strongly for the group.
The company shareholders were told at yesterday’s AGM that pre-tax first quarter profit rose 23% to $4.65 million from the same period last year, and it still expects 10% growth in its profit for the full year.
"Despite general consumer retail caution, the overall travel industry is currently displaying evidence of modest growth, albeit driven by special market stimulatory offers," managing director John Guscic said in a statement to the meeting.
"This creates an ideal environment for internet distribution which brings speed of offer to market and provides consumers with the ability to make rapid informed purchases."
The core operations of Webjet were demonstrating increased profit growth, and that was providing sufficient funding for the company’s emerging businesses, such as hotel room sales, he said.
Stage one of Webjet’s hotel platform has been launched, with rooms at more than 100,000 hotels around the world on sale through an aggregation platform similar to its flight sales platform.
Webet shares ended up 2% or 6c at $2.26.
