Rudi's View | May 08 2025
By Rudi Filapek-Vandyck, Editor
Five years of gradual erosion in the share price have significantly reduced investor enthusiasm for CSL ((CSL)). Certainly, FNArena received multiple messages in recent months from disappointed hangers-on who've decided to throw in the towel and look for greener pastures elsewhere.
It has been a remarkable reversal from the period prior to the global covid pandemic that has weighed upon CSL and the broader healthcare sector internationally. Prior to 2020 there was virtually nothing CSL could do wrong, with strong multi-year rewards for loyal shareholders cementing its status as Australia's highest quality performer.
But that was then and today the share price is lingering around $240 versus the all-time high of $342.75 reached on 20 February 2020.
We can but guess the remaining army of retail shareholders in Australia has equally responded to the southward-bound share price with above-average displeasure. The company itself, still the third largest listed on the ASX, has responded through organising shareholder briefings in between financial result releases.
The first such briefing took place on Monday in Sydney. On Friday the event moves to Brisbane.
On Monday, Chief Financial Officer Joy Linton addressed a room that was far from fully occupied --see: non-performing share price-- but casual observations afterwards suggest the overall appreciation from shareholders present was positive with many lauding her eloquence and in-depth knowledge of the company's international operations and highly specialised medical products.
As expected, one of the features in Linton's presentation slides was how badly healthcare and biotechnology shares have performed globally. Indeed, the notable reversal in CSL's underlying share price trend is not totally out-of-sync with the global headwinds that have descended upon the industry at large.
The latest obstacles can be traced back to the new administration under president Trump in the US and his personal affection for import tariffs. CSL, of course, has no idea what goes on inside Trump's head, but Linton's presentation emphasised two key messages for the room:
-CSL has a significant presence in the USA, where circa 60% of its workforce is located and 90% of its all-important plasma collection centres, implying some protection against tariffs
-CSL has a significant network outside of the USA and is flexible and agile enough to prepare and adjust for the new environment in which trade tariffs might feature prominently.
As one example of the latter, the CFO disclosed CSL is a major exporter of albumin, the most abundant protein in human blood plasma, into China but most of it is exported from facilities in Switzerland and Germany, with only a smaller part coming from the US where the bulk of plasma is being collected.
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