CSL shares ended up 2.4% in yesterday’s general rally after CEO, Paul Perreault reaffirmed to the company’s AGM that the company was sticking to previous guidance for a 10-14% increase in annual net profit in 2018-19.
The meeting was also told the company had ruled out splitting the shares (currently $183) to make them less pricey and more attractive to investors because the rising price hadn’t stopped more investors becoming shareholders.
Mr. Perreault told shareholders that CSL’s net profit, on a constant currency basis, was expected to come in between US1.88 billion and $US1.95 billion for the year to 30 June 2019.
CSL shares were up 2.4% at $193 in afternoon trading.
The CEO said the company was confident there would be continued strong demand for plasma and recombinant products, that margin growth from plasma product mix shift, specialty, and recombinant products growth & supply; CSL’s collections growth expected to outpace the market but supply remains a limiting factor; there would 30 to 35 centre openings in FY19 and a modest increase in plasma costs (is) anticipated
“This is an extremely exciting time for CSL,” Mr. Perreault told shareholders. “Your company is exceptionally well placed for growth.”
Earlier the retiring chair, Professor John Shine played down reports the company is looking at a share split to make the shares more attractive to investors (the reverse of what Emeco Holdings wants to do with its 10 for one consolidation).
CSL’s share price has more than doubled in the past three years, peaking at an all-time high of $232.69 in September.
Mr. Shine said yesterday there was no reason to emulate the three-for-one spit it undertook in 2007.
He said shareholders generally understood a split would not change the fundamental value of the company.
“Despite the increase in CSL’s share price over the past four to five years, private investors have not been deterred from buying CSL shares, with the number of shareholders increasing from less than 100,000 to more than 150,000,” Professor Shine said.
“Despite the increase in CSL’s share price over the past 4-5 years, private investors have not been deterred from buying CSL shares, with the number of shareholders increasing from less than 100,000 to more than 150,000,“ he said
“Also, given the high administrative cost of conducting a share-split (upwards of a million dollars) the board has no current plans.”
