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CSL Releases Positive Half-Yearly Results

CSL Releases Positive Half-Yearly Results
Feb 16, 2016 By Ben Khouri Tags: CSL

CSL Ltd (ASX:CSL), has released an upbeat report for the half-year ending 31st December 2015. The optimism from this report particularly came from growth in revenue and profits, along with improvements in the operations of the Biotechnology firm.

Revenue up 10%

Revenue for the period was US$3.1billion ($A4.3 billion), up 10.3% to the PCP. In similar fashion, NPAT expanded 3.8% for the period, to US$719million ($A1.0 billion).

This strong growth in profits was particularly supported by the 10% expansion in the sales at their Victorian based CSL Behring, to US$2.5billion ($A3.5 billion). Along with the 13% growth in the sales of their Immunoglobulin product, to US$1.1billion ($A1.5 billion). Above figures are denominated in constant currency terms.

International sales was a major contributor to revenue over the period. With US sales being the biggest contributor, growing 29%, to US$1.3billion ($A1.8billion). Despite German sales contracting approximately 13% for the period, they contributed US$362.2million (A$506.9million). Australian sales declined 16% for the period, to US$240.8million ($A337million).

Operating cash flow improved 7.5% for the period, to US$705.2million ($A987million).

Acquisition of Novartis

On the 31st of July 2015, through their wholly subsidiary, Seqirus Inc, CSL completed their acquisition of global influenza vaccine business, Novartis. The business was acquired for a final consideration of $280.5million.

Novartis has contributed US$298million in revenue, along with US$90 million of losses during the 31st of July 2015 to the 31st December 2015. 

Appointment of New Director

CSL announced that Dr Megan Clark AC has been appointed director of the company. Currently, Dr Clark is a Director of Rio Tinto and a member of the Australian advisory board of Bank of America Merrill Lynch.

Dividend

The board of CSL have declared an interim (unfranked) dividend of USD0.58cents (AUD0.81cents). The Ex-Dividend date is on the 23rd of March 2016, with the Payment date on the 15th April 2016.

The 2016 dividend is 8cents lower than the prior dividend in 2015 (0.66cents).

Outlook

CEO Paul Perreault commented on CSL’s outlook for FY16: “I can reconfirm my previous guidance for FY16 of 5% profit growth at constant currency. This guidance does not include the 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.”

Share Performance

Investors have reacted positively to the results, with CSL up (As at 10.34am AEDT) 2.5%, to $107.12.

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Ben Khouri Author: Ben Khouri Feb 16, 2016

Ben Khouri is a financial editor for Wise-Owl with a particular focus on the top ASX 300 companies. Having a vast background in economics and finance, Ben provides financial commentary & analysis as well as global market updates, which guide investors in devising investment strategies. Ben specialises in analysing economic data and global events from around the world and examines the impacts they have on the major equity markets.

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