CSL (ASX:CSL) share price pops on increased dividend

The CSL (ASX: CSL) share price is higher today after the biotech announced a dramatic lift in profits and boosted dividend for the half-year.

Mitchell Lawler

Mitchell stumbled upon the concept of investing when in high school, devotedly urging his parents to put some money into a handful of technology companies with increasingly popular products among his demographic – many of which have gone on to great success. It wouldn’t be until 2017, some five years later, that Mitchell became an investor of his own money. Having studied and worked as a mechanical engineer in the building services industry, Mitchell takes a methodical and analytical approach to evaluating businesses. Rather than relying purely on numbers, Mitchell drills beyond a company’s metaphorical mantle to unearth obscure patterns or competitive advantages that would go otherwise unnoticed. His expertise resides within areas such as software, consumer goods, and building services equipment. However, his quest to find quality companies that set the industry standard and flex some degree of an impenetrable position has no limits – small cap to mega cap, cosmetics to healthcare – if it’s an exceptional business it’s on his radar.

Published February 18, 2021 11:17 am AEDT

CSL Ltd (ASX: CSL) shares are trending higher in early trade today following the release of the pharmaceutical giant's half-year results. At the time of writing the CSL share price is 2.38% higher at $287.89.

medical asx share price represented by doctor giving thumbs up — Image source: Getty Images

Profits in tip-top shape

All eyes were on the CSL share price this morning following the release of the company's results. Fortunately, the numbers did not disappoint, sending CSL shares higher in morning trade.

The most exhilarating number to come out of the half-year report was the company's bumper profit. Due to increased margins, CSL managed to deliver a 45% increase to its reported net profit after tax of US$1,810 million.

Additionally, CSL's revenue grew to US$5,739 million. Although not as substantial an increase in percentage terms, at 16.9%, the top-line growth is significant. The driving force behind the increase was a 9% lift in CSL Behring revenue and a 38% jump in Seqirus revenue.

Importantly, it appears the business segment responsible for the seasonal flu vaccine has contributed largely to the result. Seqirus added US$693 million to earnings before interest and tax – an increase of 112%.

Increased CSL dividend

As a result of the strong numbers, the CSL board increased the interim dividend by 9% to US$1.04 per share. Unfortunately, the weak US dollar to AUD means this payout is 9% lower than the prior corresponding period on a constant currency basis.

By chief executive officer and managing director Paul Perreault's account, the future for CSL remains rosy: "Demand for CSL's core plasma, and influenza vaccine products remain robust."

However, there is expected to be a lift in costs in the next half as the biotech builds its research up again, after falling due to COVID-19 vaccine development efforts.

CSL share price under the microscope

The CSL share price has taken a beating over the last year, down by around 13%. COVID-19 disruptions and vaccine development efforts weighed on the business and its usual operations.

However, in the last month, the share price has experienced a reasonable 7.6% lift as some geographies return to normal.

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