Up 14% in six months, can CSL shares maintain momentum on ASX?

August 04, 2022 12:07 PM AEST | By Sonal Goyal
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  • CSL shares outperformed its benchmark index, ASX 200 Health Care in last six months by registering a 14% rise.
  • During the first quarter of FY2022, the company reported a 4% rise in revenue.
  • The company expects a decline in financial performance in FY22 as the business is seasonal.

ASX-listed healthcare company, CSL Limited (ASX:CSL) has marked significant gains in last six months as the company performed in line with its expectation during the 1HFY22 (first half of the financial year 2022).

In the last six months, CSL shares have outperformed the benchmark index, ASX 200 Health Care (INDEXASX:XHJ), which was up by over 9% during the stated time period. Meanwhile, ASX 200 (INDEXASX:XJO) was down by 1.42% In the past six months.

Today, at 10:56 AM AEST, the shares of CSL were spotted trading 0.47% down to AU$295.36 apiece.

Can CSL shares keep up the momentum?

Despite the challenging environment created by the global Covid-19 pandemic in the 1HFY22, the company delivered financial results that were in line with the company’s expectations.

In the financial year 2021, industry-wide constraints were imposed on the collection of plasma, affecting the immunoglobulin portfolio of CSL. To handle the same, the company undertook several initiatives to improve the plasma volume collection. Reportedly, it generated significant results for the company.

Paul Perreault, CEO and managing director, CSL said that with the ‘long-term nature of the company’s manufacturing cycle’, these initiatives would result in solid albumin and lg sales going forward.

Perreault mentioned that CSL’s key products are ‘not limited by plasma collection, continue their strong growth trajectory.’

Another big event that took place in CSL is entering into an agreement to buy Vifor Pharma Ltd. this acquisition is expected to add significant value to the 2030 strategy of CSL as it would enhance the focus on sustainable growth, innovation, and therapeutic leadership areas.

Recent update on Vifor Pharma

Image source: © Utah778 | Megapixl.com

CSL is expected to complete the Vifor acquisition by the mid of 2022. On 2 August 2022, the company updated the market that it had received all the regulatory approvals.

CSL highlighted that the transaction would take place by 9 August 2022.

Upon the competition of the transaction, CSL would apply for delisting Vifor from the Swiss exchange (SIX). Also, the company shared that it expects to hold over 97% of Vifor shares upon the finalisation of the transaction and will cancel the rest of the publicly held shares of Vifor, as per the Swiss Takeover rule.

Outlook shared by CSL

Considering the seasonal nature of the CSL business, Perreault said that it expects to report a loss during the second half. The expected NPAT (net profit after tax) for FY22 is around AU$2.15 billion to AU$2.25 billion at constant currency. Perreault added that this expectation includes circa AU$90 to AU$110 million costs associated with the Vifor acquisition.


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