Blood products and vaccine supplier CSL is on track to lift its full year profit 20 per cent after a bumper interim result.
Presenting his final set of results before leaving the company he has headed for nearly 25 years, chief executive Brian McNamee said earnings were expected to grow despite mixed global business conditions.
Southern European economies such as Greece, Italy and Spain were still struggling and Japan was showing little growth, he said.
However northern Europe, emerging markets and the US were “very good for us”.
“Asia continues to grow well for us, as does the rest of the world markets,” Dr McNamee said on Wednesday.
“Clearly North America remains a vital part of the success of the company.”
Dr McNamee reaffirmed CSL’s earnings guidance issued in November, when it flagged a 20 per cent rise in full year net profit, in constant currency terms.
Earnings per share were also expected to rise by about 24 per cent.
CSL’s first half net profit rose 24.3 per cent to $US626.9 million in the six months to December 31.
Revenue rose 6.4 per cent to $US2.58 billion ($A2.52 billion).
Most of CSL’s earnings growth came from improved margins, an improved presence in emerging markets and making the business more efficient.
Sales of immunoglobulin, antibodies which aid the immune system, rose 10 per cent amid strong demand in the US.
CSL’s haemophilia product sales also jumped six per cent, while its specialty blood products, including those used to treat peri-operative bleeding complications after surgery, rose 15 per cent.
The first half earnings result, and rise in unfranked interim dividend to 50 US cents from 38 US cents, were above market consensus and sparked a sharp rise in CSL’s shares in morning trade.
However the stock ended the day three cents lower at $57.21.
CSL’s shares have risen more than 80 per cent in the past 12 months.
Morningstar analyst James Cooper said the result further strengthened confidence in CSL.
“Revenue growth reflects among other things ongoing penetration of emerging markets, while profit strength also attests to further delivery of operational efficiency gains,” Mr Cooper said in a research note.
Looking ahead to when Paul Perreault takes over as chief executive on July 1, Dr McNamee said his successor would have plenty to do to continue to drive earnings.
“We have a lot of, we think still, growth corridors inside the company, we have a global footprint we are trying to grow,” he said.
Meanwhile, CSL intends to raise about $US300 million ($A292.67 million) through a new US private placement facility during the second half of 2012/13.
The funds would be used to repay existing debt, fund the company’s capital management plan – including the current share buyback – and general corporate purposes.