Strong dollar bleeds CSL profit

By Teresa Ooi

CSL’s first-half net profit fell 19 per cent to $500 million as unfavourable currency exchange rates wiped $47m from its bottom line and the blood products manufacturer continued to face weak economic conditions in key global markets.

Despite the drop in earnings, CSL will pay a dividend of 35c per share unfranked — unchanged from the previous corresponding period.

“Given the challenges of currency headwinds, government healthcare reforms and continuing weak economic conditions in a number of countries where we operate, this is a noteworthy achievement,” managing director Brian McNamee said.

He expects the company to deliver full-year net profit of $950m based on current exchange rates — down 10 per cent from its $1.05 billion profit last year.

But Mr McNamee said the full-year net profit would be at the top end of a previous guidance of $980m-$1.03bn made in October at fiscal 2009-10 exchange rates.

“This represents about a 10 per cent growth in underlying profit and translates to a net profit for the year of about $950m when current currency exchange rates are used,” he said.

The Australian dollar rose 16 per cent against the US dollar and 24 per cent against the euro during the first half.

UBS analyst Andrew Goodsall said it would be unfair to compare CSL results with last year, which spiked because of a flu pandemic.

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