CSL FY24 Earnings Call Highlights

CSL (ASX: CSL) is on track for its worst day since February after its FY25 guidance fell short of analyst expectations.

FY24 Earnings and Guidance Highlights

• Revenue up 11% to $14.8bn (all figures at constant currency)

• NPAT up 20% to $2.64bn

• NPATA up 15% to $3.01 billion

• Final dividend of US$1.45 per share

• Total full-year dividend up 12% to US$2.64 per share

• FY25 NPATA to be approximately $3.2 billion to $3.3 billion, up approximately 10-13% year-on-year

The FY24 numbers were largely in-line with analyst expectations. However, FY25 guidance fell short of $3.38 billion consensus or a 3.8% miss at the midpoint.

Earnings Call Highlights

Vifor outlook #1: "CSL Vifor continues to grow volumes despite the impact of generic competition on FERINJECT. There has been strong patient conversion to MIRCERA, our long-acting ESA, and that continued through the year." – CEO Paul McKenzie

Vifor outlook #2: "The strength in nephrology has been supported by TAVNEOS, and we expect this momentum will be maintained with multiple ongoing and upcoming EU country launches in fiscal year 2025. We remain confident in our plan to drive long-term value from the business." – CEO Paul McKenzie

Behring gross margins: "A key highlight to focus on here is the gross margin for CSL Behring, which improved 120 basis points from 49.1% to 50.3% at constant currency. This is largely in line with what we anticipated and was driven by a reduction in CPL, price increases for Ig and efficiencies across our plasma collections and manufacturing network." – CFO Joy Linton

Rika device rollout: "The RIKA rollout has progressed well, and we remain on track for full US deployment by the end of fiscal year 2025." – CEO Paul McKenzie

Plasma collections and trends: "The underlying fundamentals of plasma collection remains strong with continued momentum in donation growth. While we remain at the early stage of our gross margin recovery timeframe, we are making good progress." – CEO Paul McKenzie

R&D highlight #1: "We are excited about the prospect of bringing garadacimab to market, building on our strength in HAE with a product that expands the opportunity for patients, through differentiated and class-leading efficacy, safety and convenience. Regulatory filings for garadacimab have now been submitted in the US, Europe and Japan." – CEO Paul McKenzie

R&D highlight #2: "In partnership with Meiji, regulatory approval was received for the world's first-ever self-amplifying mRNA vaccine, KOSTAIVE, for the prevention of COVID-19 in adults. We expect sales from the Japan launch in this coming fiscal year." – CEO Paul McKenzie

Analyst Q&A Highlights

Lyanne Harrison from Bank of America said CSL is forecasting 5-7% revenue growth but what about Vifor: "We're being very realistic on our overall revenue. The Behring is back, will be high single digits. We expect Seqirus to be above market, but probably in the flattish area given the dynamic of the marketplace itself. And Vifor to your question will be flattish."

Follow-up question re Vifor gross margins: "So we've done a lot of work on the cost side of Vifor, and you can clearly see that in the numbers. There is more to do. Some of it Vifor, some of it is more broadly across the enterprise as we continue to drive cost efficiency and it's a big focus for us. So yes, there's probably some more to come."

Gretel Janu at Evans & Partners on RIKA rollout and lower collection times: "We received FDA clearance to RIKA for the individualized nomogram, but there's a second part of the validation of that when you put it into beneficial use in the centers. So, we've received it, and we're now working through the validation process across all the centers."

Andrew Goodsall of MST Marquee asked about plasma collection trends: "The cost overall CPL at the second half of the year kind of stabilized, but we've derisked significant opportunities, the RIKA rollout, the I-Nomogram. So we see a continued decrease in the CPL while we continue to bring in the appropriate donors as needed for our demand."

Follow up question re avian flu opportunity set: "Some of those countries, for example, the UK and the US have taken steps to explore with us and other manufacturers the potential to supply vaccine in this period now where the risk of human-to-human transmission is causing some concern. Those processes still have some way to play out. And so we're engaged in those discussions. And when we have more to report, we will do so."

David Low at JPMorgan asked about albumin sales in China and growth for the region: "Albumin has done very well. It grew 12% year-on-year, which was a great result. And that growth was across all markets, U.S., EU, and China. In China, we continue to see high single-digit growth, which is great. The demand is very strong, and we believe it will continue over the midterm."

This article was generated with the support of AI and reviewed by an editor.