CSL, Australia’s biggest pharmaceutical group, is paying an unchanged dividend after a slightly less than satisfying first half performance.
The company, which is the world’s second biggest blood products group, said earnings rose 3.8% in the six months to December 31 to $US718.8 million ($A1 billion).
The profit was struck on a much stronger 10.3% jump in group revenues for the half to $US3.1 billion, or 9.2% to $US3 billion, excluding the impact of currency movements.
After excluding financials relating to the recently acquired Novartis influenza vaccines business CSL said underlying NPAT grew 7% and Earnings Per Share grew 12%, at constant currency, in the December half year.
As a result, CSL’s board declared a flat interim dividend of US58 cents (A81 cents), payable on April 15.
Since launching its $1 billion share buyback last October, CSL has repurchased 2.4 million shares worth $235 million.
The shares bounced 3% higher to $107.54 yesterday after the results were released before trading started, but they eased over the rest of the session as investors reassessed thefigures. The shares ended up 1.5% on $106.
The company said sales of its key blood products rose strongly in the half year. Revenues from its immunoglobulin products jumped 13% to $US1.2 billion, while albumin sales were up 10% to $US376 million.
Seqirus reported $US519 million of sales after the business. It’s the second largest flu vaccine group in the world and was created by combining bioCSL with Novartis influenza vaccines.
Seqirus is expected to report a loss of between $US90 million and $US120 million this year, thanks to the costs of integration.
“This year CSL will mark its centenary as a very different organisation to the one that was founded in 1916 to ensure Australia had its own supply of sera, antitoxins and vaccines. Today, we are an established and growing biotherapeutics leader, developing and delivering innovative therapies for patients around the world,” CEO Paul Perreault said yesterday.
“CSL delivered an exceptional first half result, led by double-digit sales growth in all of our plasma therapy groups,” Mr Perreault said yesterday in a statement.
"In particular we saw strong demand for our immunoglobulin products with subcutaneous immunoglobulin therapy Hizentra growing at 31% and intravenous immunoglobulin therapy, Privigen, up 13%,” he said.
Commenting on CSL’s outlook, Mr. Perreault said, “2016 is an exciting year for CSL. The licenses for our novel recombinant coagulation products are currently under review, and pending approval, we plan to introduce these to the market later this year.
“We have been investing in our commercial capabilities to support the launch and rollout of these products. We have also continued to invest in our research and development pipeline and our manufacturing spine to ensure we meet growing demand.
"Notwithstanding this additional expenditure and the current competitive market, I can reconfirm my previous guidance for FY16 of 5% profit growth at constant currency.”
Mr Perreault continued, “This guidance does not include financials associated with the acquisition of the Novartis influenza vaccines business, which we anticipate will report a loss in the range of approximately US$90 – 120 million this financial year.
"However, with the deal now closed a significant multi-year strategy has commenced to integrate this business and turn its performance around,” he added.
CSL Half Year Result 16 Feb 16: CSL beats expectations & intergrates Novartis flu business
