Reduction in CSL’s Plasma Supply Expected to be Short-Lived, Maintain AUD 282 FVE

Plasma donations collected by narrow-moat CSL reduced in March, despite demand for its products increasing. As the manufacturing lead-time is nine months, any impacts from lower available volumes will reflect in the 2021 fiscal year. Consequently, the company maintained its fiscal 2020 constant currency net profit guidance of USD 2,110 million to USD 2,170 million. However, the impacts of the strong U.S. dollar will likely result in greater headwinds on reported results, to USD 100 million from USD 70 million expected previously, and results in our USD 2,080 million net profit being slightly ahead of guidance. We make no change to our forecast for currency volatility and maintain our AUD 282 fair value estimate.