CSL +17.25%: surged after delivering a better-than-feared FY26 result, with revenue strength across all three divisions and underlying earnings ahead of expectations. The key positive was CSL Behring, particularly immunoglobulins, while FY27 guidance also landed in line with consensus.
Key results:
- Total revenue of US$15.80bn, up 1.5% and ~2.5% ahead of US$15.42bn expected.
- CSL Behring revenue of US$11.39bn, ~2.5% ahead of US$11.11bn expected.
- Seqirus revenue of US$2.03bn, ~2% ahead of US$1.99bn expected.
- Vifor revenue of US$2.38bn, ~1% ahead of US$2.35bn expected.
- Net profit (NPATA) of US$3.10bn, down 4%, or US$3.14bn at constant currency.
- Net loss of US$2.58bn, reflecting significant impairments and restructuring charges.
- Final dividend of US$1.62ps.
FY27 is being positioned as a reset year, with group revenue expected to be broadly flat at constant currency but underlying net profit (NPAT) forecast to grow ~5%. Behring remains the engine room, with mid-single-digit revenue growth and immunoglobulins expected to grow mid-to-high single digits. However, Vifor revenue is expected to fall ~25% as generic competition bites, while Seqirus is only expected to deliver low-single-digit growth. Importantly, CSL has already delivered US$176m of cost savings, providing a lever to support earnings despite the subdued top line, while the company plans to progress another A$1.1bn of its buyback in FY27.
MM’s view: The relief rally makes sense. Expectations had become very low and CSL delivered a cleaner FY26 result than we thought. However, the longer-term debate hasn’t disappeared: flat FY27 revenue and ~5% NPAT growth raise the question of whether CSL has structurally transitioned from a premium growth company to a mid-single-digit earnings grower, leaving room for downside if the former is still true.
MM remains neutral toward CSL
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