Perreault pushes back as CSL shares dive after modest lift in full-year profit

CSL chief Paul Perreault has pushed back against the negative market reaction to its modest lift in full-year earnings.

CSL chief Paul Perreault. (Aaron Francis/The Australian)

Australian biotech giant CSL delivered a small lift in annual profit to $US1.3 billion as chief Paul Perreault labelled market reaction to today’s annual result as “typical”.

The company reported an annual net profit was a 7.6 per cent lift on the previous year, while reported sales revenue of $US6.6bn was 12 per cent higher. but shares in the company fell 6.4 per cent after the market opened before clawing back to sit around 3.9 per cent lower at $122.21. The jump in profit and an outlook of double digit growth wasn’t enough to satisfy some analysts who said the numbers missed their guidance.

“We come out with a great result and we have a double digit outlook for the following year and people get disappointed. It’s hard for me to understand to be honest,” Perreault told The Australian.

“I haven’t seen many companies performing at this level. The underlying reported result is ticking along at a strong pace. The quality of the earnings and the health of the business are quite strong.”

The CSL chief says it depended on what analyst report you looked at — saying everyone has their own models to determine what they were expecting.

“When I look at the range of the profit we have guided to for the coming year, I think it is strong,” he says.

“If the share price drove me every day, I’m focused on the wrong stuff. The game plan is what I’m focused on and if you’re focused on that, the scoreboard will eventually be in your favour.”

Mr Perreault, commenting on the outlook for the company, highlighted that the haemophilia market continued to evolve and its new generation products would offset the anticipated decline in earnings from Helixate as that supply contract ended this calendar year.

He also said the company (CSL) expected solid ongoing demand for CSL Behring biotherapies and strong market acceptance of its newly improved speciality product Haegarda.

Mr Perreault outlined that CSL’s net profit after tax for 2018 was expected to be in the range of $1.4bn to $1.5bn.

Commenting on the 2017 result, he labelled the numbers as “exceptional”, saying that the strong year reflected the successful extension of the company’s strategy.

“We delivered on our promise to provide innovative medicines to patients with rare and serious diseases in more than 60 countries,” he said.

Mr Perreault added that Seqirus, CSL’s flu vaccine division, continued to make steady progress, which included securing multiple new product licences. He said that division was expected to continue its path toward profitability.

The CSL chief also highlighted in the results the company’s expansion into China through its acquisition of a majority stake in Chinese company Ruide, which develops and manufactures plasma-derived products.

“This is a modest entry point into one of the largest and fastest growing immunoglobulin markets in the world,” Mr Perreault said.

“We now have the capabilities to expand our efforts in delivering life-saving therapies to Chinese patients with rare and serious diseases.”

The annual financial report also highlighted that in 2018 the company expects to approach the US private placement market to raise around $US600m for general corporate purposes, as part of its overall capital management program.

At 11.37am (AEST) shares in CSL were down 3.9 per cent at $122.21.