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CSL in a Battle to Become ASX’s Top Stock

  • February 24, 2020 10:54 PM AEDT
  • Kunal Sawhney
    CEO Kunal Sawhney
    2295 Posts

    Kunal Sawhney is founder & CEO at Kalkine and is a richly experienced and accomplished financial professional with a wealth of knowledge in the Australian Equities Market. Kunal obtained a Master of Business Administration degree from University of T...

CSL in a Battle to Become ASX’s Top Stock

Global biotechnology company CSL Limited (ASX:CSL) is in a race with Commonwealth Bank of Australia (ASX:CBA) to become the Australian Stock Exchange’s (ASX) biggest company by market capitalisation. While the major ASX-listed companies including Coles, BHP and Qantas, were busy in updating their respective half-year results, vaccine maker CSL has been in a battle to become Australia’s largest company. On Thursday, 20 February 2020, it briefly occupied the top spot on the exchange.

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Healthcare stocks have benefitted from the fear of coronavirus, and the pharmaceutical companies have started the discovery and development of solutions for the prevention and control of COVID-19.

On coronavirus epidemic, CSL stated that its focus area is the influenza virus and not the novel coronavirus. However, the company has partnered with the vaccine development program of the University of Queensland for COVID-19.

Moreover, the company disclosed that it would deliver its technical expertise and donate Seqirus proprietary adjuvant technology, MF59®, to the Brisbane-based university’s pre-clinical development plan.

In acknowledgment of the effect on the communities within which CSL operates, the company promised a donation of approximately RMB 1 million to the China Red Cross, in support of efforts for the prevention of the coronavirus outbreak.

Let us now delve deep and discuss the global biotechnology company, CSL Limited.

CSL Limited (ASX:CSL)

About the company

A leading global ASX-listed biotechnology company, CSL Limited is engaged in providing life-saving treatments, including those medicines that are used for the treatment of immune deficiencies and haemophilia, and also have the portfolio to offer vaccines for influenza prevention.
The company operates in CSL Behring, CSL Plasma and Seqirus businesses, and employs ~25,000 people.

CSL offers life-saving medicines to over 70 countries. The unique combination of research & development focus, operational excellence and commercial strength enables the company for developing and delivering innovations so that the patients can improve their lives and live to the fullest.

Read more about CSL at Why CSL Is Still the Market Darling?

In its JP Morgan healthcare conference presentation (2020), the company discussed its CSL Behring and Seqirus businesses, with the financial year 2019 highlights-

Stock performance

On 24 February 2020, CSL stock closed the day’s trade at $325.460 down by 3.252%, from its last close. The stock’s 52-weeks high and low price of the stock were noted at $184.000 and $342.750, respectively, with a market capitalisation of about $152.69 billion.

The stock has delivered a positive return of nearly 22.31 per cent on a YTD basis and 42.97 per cent in the last six months.

Appointment of New Non-Executive-Director

In December 2019, the company announced the appointment of Ms Carolyn Hewson AO as a Non-Executive Director. She has more than 35 years’ experience in the finance sector and brings extensive risk and investment management as well as financial market experience to the Board of CSL.

A person on the board of the company having excellent experience in finance could be one of the reasons for the continuous growth of the company.

Impressive half-year FY 2020 results with double-digit growth in revenue and NPAT

The company updated the market with its half-year results on the ASX, with CSL delivering a strong half-year performance for the financial year 2020. The revenues and NPAT grew 11% each, indicating:

  • Steady progress in immunoglobulin portfolio.
  • In China, transition to own distribution model is progressing well.
  • Continued advancement of the haemophilia portfolio.
  • Robust performance from its Seqirus business.

Let us now discuss business performance for CSL Behring and Seqirus:

CSL Behring- The business is into development and delivery of a broad range of products for the treatment of serious and rare diseases like primary immune deficiencies (PID), von Willebrand disease (vWD), chronic inflammatory demyelinating polyneuropathy (CIDP), inherited respiratory disease, haemophilia and hereditary angioedema (HAE).

The products provided by CSL Behring are also applied in burn treatment, cardiac surgery and for urgent warfarin reversal.

The therapeutic areas of CSL Behring comprise; Immunology and Neurology; Cardiovascular and Metabolic; Haematology and Thrombosis; Respiratory and transplant.

  • Immunoglobulins sales increased by 26%, including a 28% growth in PRIVIGEN® and a 37% growth in HIZENTRA®. The growth was driven by CIDP indication, competitor supply challenges, and new patient starts in PID.
  • Sale of albumin down by 33%, however US sales up by 5% and double-digit sales growth in Europe & Emerging Markets. Sales in China impacted by the one-off transition to a new distribution model and strong underlying growth in China continues.
  • Specialty Products sales increased by 7%-

Seqirus- Seqirus is a crucial contributor to the prevention of influenza worldwide and manages state-of-the-art manufacturing facilities in Australia, the UK and the United States. Seqirus has leading R&D capabilities, a comprehensive and distinguished product portfolio and commercial operations in beyond 20 countries.

  • Revenue from Seqirus up by 9% including the increased sale of Seasonal Influenza vaccines (up 16%)
  • FLUCELVAX®, launched in Europe and launch in Australia, is expected in the second half of 2021.
  • In Australia, aQIV launch is anticipated in the second half of 2020, and in the United States & Europe, registration is expected in the calendar year 2020.
  • AUDENZTM world’s first cell-based influenza A (H5N1) pandemic vaccine approved by the US FDA.
  • Real-world data continues to demonstrate the potential for improved effectiveness of FLUCELVAX® & FLUAD®

Financial Highlights-

  • The net profit after tax of the company for 1H FY2020 was reported to be US$1,248 million, increased by 11% as compared to the previous corresponding period (pcp).
  • Total reported revenue for 1H 2020 was approximately US$4,911 million, up by 11% as compared to pcp.
  • EBIT for the first half of FY2020 was reported to be US$1,632 million, up by 8%.
  • The earnings per share for 1H FY2020 was reported to be US$2.75.
  • Increased sale in CSL Behring, and Seqirus segment was reported to be US$3,768 million and US$941 million, respectively.
  • Growth of 11% and 9% was recorded in revenue for CSL Behring and Seqirus segment, respectively.


  • The company continued strong demand for its therapies.
  • On albumin sales one-off effect is predicted occurring from transition to new distributor model in China.
  • For the financial year 2020, NPAT is anticipated to be approximately $2,110 million to $2,170 million, including the impact of China GSP transition.
  • Strong growth is expected in the second half of 2020, as compared to pcp.

In biotechnology domain, CSL is one of the most prominent ASX listed players and has reported strong financial growth in the first half of the fiscal year 2020.

CSL is in a parallel race with the topmost ASX-listed player CBA in terms of market capitalisation, and it could be anticipated to become a leading player by glancing at the robust financials and well-planned future objectives.

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