Australian biotech CSL profit jumps on post-lockdown revival
Blood plasma unit profit down 6.25%
Vaccines unit profit up 9%
Shares up 1%
Recasts and writes through, adds analyst quote and shares
By Byron Kaye and Archishma Iyer
Feb 14 (Reuters) -Australian biotech giant CSL Ltd CSL.AX said on Tuesday its first-half profit jumped 10%, beating analyst estimates, as a resurgence in blood plasma donations enabled it to boost sales and more people got vaccinated against influenza.
The result shows Australia's fourth-largest listed company benefiting from a return to pre-COVID-19 activity, even as rising raw material fees, interest rates, and staff wages squeeze margins across the economy.
CSL makes most of its profit collecting blood plasma and converting it to treatments for rare diseases and in the early stages of the pandemic had to hike the fees it paid donors to counteract a slump in collections.
The strategy paid off, the company said, with collections up 36% to a record volume in the six months to end-December from the same period a year earlier. Volumes jumped 10% from pre-pandemic levels.
"We are now starting to reap the benefits of that hard work," Chief Financial Officer Joy Linton told analysts on a call.
Higher collection fees had added to inflationary pressures, but "I'm not sure we ever think donor fees will ever go back to where they were pre-COVID", Linton said.
CEO Paul Perreault said demand for blood plasma products was rising also because the return of face-to-face doctor visits was resulting in more diagnoses.
"You cannot diagnose rare diseases with a Teams call," said Perrault, who is retiring after having led the company for a decade.
CSL posted underlying profit, excluding one-off items, of $1.96 billion on a constant currency basis for the half year, up 10% from a year earlier and beating a Citi estimate of $1.8 billion.
The company's shares rose 1% by mid-session, bettering a broader market .AXJO gain of 0.4%.
"The sentiment continues to improve along with recovery in plasma collection," Citi analysts wrote in a client note.
Operating profit from CSL's blood plasma unit slipped 6.25% due to higher costs. Profit from its vaccine unit, which delivers about a quarter of earnings, rose 9% as more people went for seasonal influenza shots.
The company declared an interim dividend of $1.07 per share, up from$1.04 the previous year.
Reporting by Byron Kaye in Sydney and Archishma Iyer in Bengaluru; Editing by Krishna Chandra Eluri and Sonali Paul
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