REPORTING SEASON: CSL Limited (CSL)

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Figure 1: CSL Limited 12 month chart

 

CSL Limited (CSL) New competitors make life tough for CSL

 Biopharmaceutical and drug research firm CSL Limited (CSL) first half 2015 result was below market expectations as new entrants into the market and higher costs hit its bottom line. Cost of sales lifted by 10% and CSL’s research and stgelopment spend increased by 1.8% while company administrative costs grew by over 35%.

 CSL Behring sales grew by 8% to US$2.5 billion. Immunoglobulin (IM) product sales up 5% to US$1,122 million. The average IM price fell due to tougher competition in the market and larger proportion of sales were for the cheaper products. Albumin sales grew 16%, driven by ongoing strong global demand. Haemophilia product sales lifted by only 3% to US$558 million, as plasma market sales were hit by the pressure by new entrants and competitive pricing especially in Europe.

 Bio CSL sales of A$276 million Influenza vaccine sales grew strongly to A$116 million, driven by a severe influenza season in the northern hemisphere.

 Cash from operations lifted by 28% and cash in hand increased to US$10.6 billion over the year. CSL announced that it had agreed to acquire Novartis’ global influenza vaccine business for US$275 million back in October 2014. CSL is currently still in the middle of it A$950 million buyback.

 CSL said it “expect that global demand for plasma therapies will continue to grow, but the market will become increasingly competitive, with new competitors and new products. CSL expects FY15 product growth to now only increase by 10%

 CSL will pay A$0.74 interim dividend to shareholders on the 10th of April 2015.

 

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Juliana Roadley, Market Analyst,