CSL (ASX:CSL) used its first-half fiscal 2026 results briefing to outline progress on a company-wide transformation program, discuss the impact of several policy and competitive headwinds on key franchises, and reaffirm full-year guidance while expanding its share buyback.
Leadership transition and strategic focus
CSL Head of Investor Relations Mark Deering opened the webcast by referencing an ASX announcement made the prior day appointing Gordon Naylor as Interim Chief Executive Officer and Managing Director. Naylor said his “main job is to run the business,” while giving the board space to appoint a successor, adding he expects to serve for “about a year.” He said interim does not mean he will take “a back seat,” and that he intends to drive the company forward.
First-half results and capital returns
Chief Financial Officer Ken Lim said CSL’s first-half results were impacted by government policy changes and one-off costs tied to the transformation program and asset impairments. On a constant currency basis, group revenue fell 4% and NPATA declined 7%. Reported net profit after tax fell 81% after including one-off costs.
CSL reported cash flow from operations of $1.3 billion for the half and declared an interim dividend of $1.30, unchanged from the prior comparable period. Lim also announced an expansion of the company’s share buyback for the year from $500 million to $750 million, noting that CSL repurchased about $400 million of shares in the first half and ended December 2025 with leverage of 2x.
CSL Behring: IG and albumin headwinds, new product momentum
Chief Commercial Officer Andy Schmeltz said the first half was “a challenging time” for the business, pointing to declines in immunoglobulin (IG) sales of Privigen and Hizentra versus a strong prior comparable period in first-half fiscal 2025. Schmeltz attributed pressure to the impact of U.S. IRA Medicare Part D reforms and the expiration of some international contracts. However, he said that compared with the trailing six months through June 2025, IG revenue increased 3% on a like-for-like basis relative to Medicare Part D.
Schmeltz and Lim both pointed to China as the key driver of albumin weakness, reflecting disruption from policy changes and cost controls. Schmeltz said CSL mobilized mitigation actions and cited a “positive response” in the most recent three months from expanding its hospital field force in China and from an exclusive retail channel partnership announced in early November 2025.
CSL Behring’s performance was partially offset by growth in other areas. Schmeltz said sales of HEMGENIX grew 16%, supported by positive five-year data published in The New England Journal of Medicine in December 2025. He also said CSL was “very pleased” with the launch of ANDEMBRY for hereditary angioedema (HAE) prophylaxis, adding that less than a year into the launch, more than 1,000 HAE patients globally were on therapy. Perioperative bleeding product KCENTRA, he said, continued to face competitive dynamics.
Looking ahead, Schmeltz said CSL expects “stronger double-digit” IG portfolio growth in the second half as one-time impacts roll off and commercial investments take hold. He cited expanded U.S. IG and hospital sales forces, restarting Hizentra direct-to-patient marketing, and broader contracting efforts. He said U.S. Privigen grew faster than the IVIG market in the last quarter, and that international business excluding the U.K. was growing in the high single digits, while acknowledging that forward performance must validate the outlook.
On albumin in China, CSL outlined several actions it expects to support a second-half recovery:
- Expanding geographic footprint across additional provinces, cities, and hospitals, including ramping across eight “must-win” provinces and pursuing more than 100 new hospital listings.
- An exclusive partnership with Chinese distributor Beheil Medical aimed at the private pay retail segment.
- Generating real-world evidence and driving on-label demand through medical and commercial initiatives.
In the Q&A, Schmeltz said a “modest year-over-year decline” in albumin in fiscal 2026 with a return to growth in 2027 was “more appropriate guidance,” while reiterating expectations for a much stronger second half.
Seqirus and Vifor: mix shifts, nephrology strength, and looming reimbursement changes
CSL Seqirus General Manager Dave Ross said the influenza pandemic business returned to more normalized levels after “non-recurring H5 outbreak revenue” in fiscal 2025. He said Seqirus is the only company delivering year-on-year revenue growth in seasonal influenza, supported by differentiation through cell-based FLUCELVAX and adjuvanted FLUAD, as well as geographic expansion. Ross also noted the opening of CSL’s cell-based Tullamarine facility, enabling a full conversion to differentiated vaccines while expanding pandemic capabilities. He said the global seasonal influenza market is projected to decline mid- to high-single digits on a value basis, with U.S. immunization rates expected to decline low- to mid-single digits this season.
On CSL Vifor, Schmeltz said revenue was up double digits at constant currency, driven by nephrology, while the iron business fell due to generic competition. He said dialysis segment sales jumped, driven by strong demand for Velphoro as inclusion in the TDAPA scheme delivered full benefit, and that Mircera performed well and remains the market leader in the U.S. He also cited continued uptake of TAVNEOS and a successful European launch rollout for FILSPARI.
Lim later cautioned that TDAPA inclusion for Velphoro is expected to roll off from December 2026, and said the company would expect a “significant drop” in Velphoro revenues at that point, tempering nephrology growth rates in fiscal 2027. He also referenced an EMA Article 20 assessment for TAVNEOS and said the company is working with regulators through the process.
Costs, impairments, and guidance
Lim said total group revenue was $8.3 billion, gross profit was $4.6 billion, and group operating result was $3.8 billion. R&D expense was $600 million, down 8%, which he said reflected restructuring progress that is “a little ahead of schedule,” with a similar R&D spend expected in the second half. G&A costs fell 2% and were also expected to be similar in the second half. Net interest expense declined 11% as the balance sheet continued to delever.
By business unit, CSL Behring revenue fell 7% and operating result fell 9%, with gross margin up 10 basis points. Lim said margin reflected efficiencies in plasma collection and manufacturing and growth in HEMGENIX and ANDEMBRY, offset by Medicare Part D impacts and declines in albumin and KCENTRA. He said Medicare Part D alone represented roughly a 100-basis-point margin headwind. Seqirus revenue declined 2%, while margins were pressured by U.S. pricing, geographic mix shifts, and the non-continuation of avian flu sales recognized in fiscal 2025. Vifor revenue rose 12% and operating result rose 22% as efficiencies flowed through.
On transformation, Lim reiterated a target of up to $550 million in annual cost savings by fiscal 2028, with one-off restructuring costs of $700 million to $770 million. For fiscal 2026, CSL aims to deliver $100 million of cost savings and said it achieved 60% of that target by the half year.
Separately, Lim said CSL expects total after-tax impairments of about $1.1 billion in fiscal 2026, with $1.05 billion taken in the first half. He said the impairments largely relate to:
- A write-down tied to a self-amplifying mRNA licensing agreement, citing a decline in COVID disease burden and a more onerous U.S. regulatory regime for mRNA vaccines.
- An impairment of Venofer following the licensure of three generic competitors in the U.S. in the latter half of 2025; Lim noted Venofer contributed about $170 million in sales last fiscal year.
- Redundant plant, property, and equipment related to accelerating investment in Horizon 2 manufacturing capacity.
CSL also anticipates an impairment of about $70 million post-tax in the second half related to Velphoro, reflecting the expected roll-off of TDAPA inclusion from December 2026. Lim said impairments are “almost entirely non-cash” and have minimal impact on forward-looking prospects.
For the full year, Lim said CSL is maintaining guidance and expects a stronger second half driven by double-digit IG growth for Privigen and Hizentra, stabilization and recovery in China albumin supported by expanded commercial efforts and the Beheil partnership, and continued momentum in HEMGENIX and ANDEMBRY, while accounting for competitive pressures in iron, KCENTRA, and HAEGARDA.
About CSL (ASX:CSL)
CSL Limited researches, develops, manufactures, markets, and distributes biopharmaceutical and vaccines in Australia, the United States, Germany, the United Kingdom, Switzerland, China, and internationally. The company operates through CSL Behring, CSL Seqirus, and CSL Vifor segments. The CSL Behring segment offers plasma products, gene therapies, and recombinants. The CSL Seqirus segment provides influenza related products and pandemic services to governments. The CSL Vifor segment offers products in the therapeutic areas of iron deficiency and nephrology.
