CSL bracing for pinch in health budgets

The profits of Australia's biggest pharmaceutical company, CSL, will slow this year as hospitals around the world feel the pressure of tighter healthcare budgets.

The company is poised to sign off on another share buyback scheme in response to weaker key markets.

CSL - long favoured by investors for its strong performance - reported a full-year net profit of $US1.2 billion ($1.3 billion) for the 12 months to June, up 19 per cent. Due to the fact that it makes most of its revenue outside Australia, it has begun reporting in US dollars.

Chief executive Paul Perreault, who took over from Brian McNamee last month, said he expected net profit growth to be 10 per cent in constant currency terms for the present financial year, due to weakness in the global economy.

He said a $US500 million share buyback was almost complete and the board was considering another scheme for a similar amount.

"Looking into 2014 we see trading conditions being tempered again by economic pressures," he said. "We do see our products continuing their growth on the basis of new medical uses and expansion of uses in developed and emerging markets."

Shares in the vaccines and blood treatments group fell 3 per cent to close at $65.79 on Wednesday, despite the robust result.

The company declared an unfranked final dividend of US52¢ per share to be paid on October 4 - up from US49¢ last year.

When asked if CSL had reached the peak of an economic cycle, Mr Perreault said: "No, not at all.

"Actually, 10 per cent growth is quite strong."

CSL, which started life as the government's Commonwealth Serum Laboratories, makes most of its revenue through the sale of blood transfusion products to hospitals. One of its core products, immunoglobulin, is used to replace antibody cells in people with low immunity.

Sales of immunoglobulin rose 9 per cent to $US2 billion for the year. The biggest-growth product was albumin, another blood treatment, the revenues of which rose 28 per cent to $US600 million due to higher demand in China.

Mr Perreault said CSL had benefited from a number of one-off factors during the past year, including higher Gardasil vaccine royalties, lower tax rates and improvements to its distribution model in China.

He stressed the importance of finding new markets: "Once you get vaccinated, you're done, so you have to look for new people to vaccinate."

CSL has frequently been rated one of the best performing companies on Australian stock Exchange, due in part to the legacy of Mr McNamee, who spent more than two decades in the top job.