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CSL share price: where next following FY20 profit upgrade?

We unpack some of the key figures behind CSL's first-half earnings release.

CSL share price: the golden run continues

CSL today opened at an all-time-high of ~$335 per share, after the company reported an impressive set of first-half results to the market this morning.

And though the biotech giant gave up some of those gains in the hours that followed – the CSL share price is still up ~68% in the last year.

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Ultimately, Credit Suisse’s prediction that CSL would upgrade its full-year earnings guidance proved somewhat prophetic, as the biotech giant today reported that it now expected FY20 earnings (NPAT) in the range of US$2,110 million to US$2,170 million.

CSL had previously guided for FY20 NPAT of between US$2,050 million and US$2,110 million.

The investment bank’s reasoning for that prediction prior to today's announcement was simple, arguing that CSL’s: ‘market leading position within the tight IG market where it is able to meet demand and achieve positive mix & pricing growth supports 11% earnings growth in FY20.'

These new figures imply full-year NPAT growth of 10-13%, on a year-over-year basis.

Fundamentals in focus

Centrally, CSL today reported continued profit growth, with H1 earnings (NPAT) rising to US$1,248 million, representing an 11% increase on a constant currency basis.

The biotech giant attributed this increase to growth in the company's IG product line-up, the 'continued evolution of the haemophilia therapies portfolio', and the 'seqirus influenza vaccines business delivering another strong performance.'

In step with that, CSL reported earnings per share (EPS) of US$2.75 per share, representing an 11% increase on a constant currency basis.

Reflecting on these results, CSL's Chief Executive Officer and MD, Paul Perreault commented:

'I am pleased to report a strong first-half result of the 2020 financial year. Our results reflect the focused execution of our strategy, robust demand for our differentiated medicines and a deep, inherent passion for meeting the evolving needs of our patients.'

The company also reported another year of good dividend growth, with CSL declaring an interim dividend of US$0.95 per share (or $1.42 per share in AUD).

The outlook

Besides upgrading their FY20 profit guidance today, Mr Perreault today also said that:

'CSL is well positioned for sustainable growth. Exceptional demand continues for our differentiated therapies. We expect to again outpace the market in expanding plasma collections and our objective to open 40 new collection centres this financial year is on track.'

A little after noon, the CSL share price had drifted back into the green, currently trading around the $327 mark.

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