CSL Ltd. — Interim / Quarterly Report 2014

Feb 11, 2014

For immediate release 12 February 2014

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Half Year Result 1H 2014

US Settlement Impacts Half Year Profit Exceptional Performance in Specialty Products Full Year Profit Guidance Re-Affirmed

CSL Limited (ASX:CSL) today announced a net profit after tax (NPAT) of US$646 million for the six months ended 31 December 2013, up US$21 million or 3% on a reported basis when compared to the prior comparable period (PCP). The result included a oneoff U.S. antitrust class action litigation settlement of US$64 million, or US$39 million after tax.

KEY ITEMS

Financial

• Revenue US$2,691 million, up 5% on PCP

• Up 6% at constant currency[1]

• EBIT US$818 million, up 5%

• Up 2% at constant currency

• NPAT US$646 million, up 3% on PCP

• Up 2% at constant currency

• Research and development investment increased to US$229 million

• Interim dividend[2] increased to US$0.53 per share, unfranked for Australian tax purposes, payable on 4 April 2014

• Converted to Australian currency, interim dividend increased to approximately A$0.59 per share, up 21% on PCP

Operational

• Hizentra[® ] (subcutaneous immunoglobulin)

• U.S. approval for bi-weekly administration

1 Constant currency removes the impact of exchange rate movements to facilitate comparability. See end note (#) for further detail.

2 For shareholders with an Australian registered address, dividends will be paid in A$ at an amount of A$0.588830 per share (at an exchange rate of A$1.1110/US$1.00), and for shareholders with a New Zealand registered address, dividends will be paid in NZD at an amount of NZ$0.639021 per share (at an exchange rate of NZ$1.2057/US$1.00). The exchange rates used are fixed at the date of dividend determination. All other shareholders will be paid in US$.

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12 February 2014

  - Japanese approval for treatment of primary immune deficiency and secondary immune deficiency

• Kcentra[®] (4 factor pro-thrombin complex concentrate) - approved by U.S. FDA for surgical use

• CSL 362 (acute myeloid leukaemia) – license agreement with Janssen Biotech, Inc.

•  CSL 112 (acute coronary syndrome) – global phase IIb clinical trial commencing in 2014

• Alpha-1 (hereditary lung / liver disease) – innovative diagnostic test kit launched

• A$950 million share buyback[3] 22% complete

• Agreement to settle U.S. antitrust class action litigation

• Establishing a sponsored Level 1 American Depository Receipts program

CSL Chief Executive Officer and Managing Director, Paul Perreault said “The underlying result is solid and I’m also very pleased with the progress we’ve made in bringing new products to market and with the advances in our research and development pipeline. We’ve also been able to remove the risk and distraction associated with the U.S. antitrust class action litigation.”

“The Company’s specialty products again performed exceptionally well, led by a very successful rollout of Kcentra[®] in the U.S. Our subcutaneous immunoglobulin, Hizentra[®] , continues to be in strong demand,” Mr Perreault said.

OPERATING REVIEW

CSL Behring sales of US$2.4 billion grew 6% in constant currency terms, when compared to the prior comparable period.

Immunoglobulin product sales of US$1,085 million grew 7% in constant currency terms in a global market that remains robust. Demand for subcutaneous immunoglobulin (SCIG) was strong in both the U.S. and Europe. Hizentra[®] offers patients the convenience of self administration at home.

Intravenous immunoglobulin sales growth was underpinned by strong demand for Carimune[®] in the US and Brazil. Privigen[®] also contributed to growth, benefiting from a

3 CSL reserves the right to suspend or terminate buy-backs at any time.

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12 February 2014

full six months of sales with an expanded indication in Europe to include its use in the treatment of chronic inflammatory demyelinating polyneuropathy.

Albumin sales of US$313 million grew 7% in constant currency terms. Albumin demand in Europe was solid, boosted by cautionary statements from the regulator in relation to the use of hydroxyethyl starches, which are sometimes used as an alternative to albumin. This growth follows a very strong prior comparable period, which was driven by sales in China.

Haemophilia product sales of US$550 million declined 4% in constant currency terms. Humate[®] sales in the U.S. were strong arising from increased usage in surgery. However, this was offset by the conclusion of a number of treatment programs for immune tolerance therapy patients. In addition the timing of plasma derived haemophilia product sales in tender markets can be uneven. Recombinant factor VIII sales declined 1% in constant currency terms, influenced by the number of clinical trials underway for new generation recombinant factor VIII products where patients receive clinical trial products at no cost.

Specialty products sales of US$403 million grew 16% in constant currency terms. In April 2013 the U.S. Food and Drug Administration (FDA) approved Kcentra[®] for urgent warfarin reversal in patients with acute major bleeding. This was followed in December 2013 with approval for an expanded indication to include the urgent reversal of acquired coagulation factor deficiency induced by vitamin K antagonist (e.g. warfarin) therapy in adult patients needing urgent surgery or other invasive procedures. These developments have underpinned strong growth in U.S. demand for Kcentra[®] . In August 2013 the U.S. Centres for Medicare and Medicaid Services approved a new technology add-on payment for Kcentra[®] recognising its significant clinical advancement for reversing the effects of warfarin in patients who experience acute major bleeding. Kcentra[®] was granted Orphan Drug Marketing Exclusivity for a period of 7 years effective December 2013 based on the approved surgical indication.

Strong demand continues for Berinert[®] , which is used for the treatment of acute attacks in patients with hereditary angioedema. The U.S. FDA approval in 2012 of a label expansion to include self administration is underpinning new patient take up.

bioCSL sales of US$217 million declined 7% in constant currency terms. Influenza sales totalled A$94 million. Strong demand in the US was more than offset by a reduction in

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12 February 2014

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European sales following market exit by bioCSL’s business partner in that region. GARDASIL* sales grew strongly arising from higher than expected uptake in Australia.

CSL Intellectual Property revenue was US$101 million, driven by granting of a license to Janssen Biotech, Inc., to progress CSL’s acute myeloid leukaemia product currently in development. Also contributing to growth were royalty contributions from Human Papillomavirus Vaccines.

OUTLOOK (at 12/13 exchange rates)

Commenting on CSL’s outlook, Chief Executive Officer and Managing Director Paul Perreault said, “We are optimistic about continued demand for plasma therapies. Our current capacity expansions and product innovations put us in a good position for the future. Competition is vigorous but I believe our philosophy of sustainable continuous improvement in everything we do is fundamental to dealing with these pressures. Efficiency and productivity are key to our ongoing success.

I’m pleased to re-affirm our profit outlook. Net profit after tax growth for the current full financial year is expected to be approximately 7% at 2012/2013 exchange rates.

Earnings per share growth will exceed profit growth expectations as shareholders benefit from the ongoing effect of past and current share buybacks,” Mr Perreault said.

In compiling the Company’s financial forecasts for the year ending 30 June 2014 a number of key variables which may have a significant impact on guidance have been identified and these have been included in the footnote[4] below.

Additional details about CSL’s results are included in the Company’s 4D statement, investor presentation slides and webcast, all of which can be found on the Company’s website www.csl.com.au A glossary of medical terms can also be found on the website.

4 Key variables which may have a significant impact on guidance include material price and volume movements in plasma products, competitor activity, changes in healthcare regulations and reimbursement policies, royalties arising from the sale of Human Papillomavirus Vaccine, internationalisation of the Company’s influenza vaccine sales and plasma therapy life cycle management strategies, enforcement of key intellectual property, regulatory risk, litigation, the effective tax rate and foreign exchange movements.

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12 February 2014

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For further information, please contact:

Investors:

Mark Dehring Head of Investor Relations CSL Limited Telephone: +613 9389 2818 Email: mark.dehring@csl.com.au

Media: Sharon McHale Senior Director Public Affairs CSL Limited Telephone: +613 9389 1506 Mobile +614 0997 8314 Email: sharon.mchale@csl.com.au

Tim Duncan Hintons & Associates Phone: +613 9600 1979 Mobile: +614 0844 1122 Email: tduncan@hintons.com.au

• ® Trademarks of CSL Limited or its affiliates.

• GARDASIL is a trademark of Merck & Co. Inc.

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12 February 2014

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Group Results US Dollars

Six months ended Dec US$ Millions	Dec 2012 Reported Dec 2013 Reported Dec 2013 at CC# Change %
Sales Other Revenue / Income Total Revenue / Income	2,482 2,574 2,595 4.5% 84 117 117 2,567 2,691 2,713 5.7%
Earnings before Interest, Tax, Depreciation & Amortisation Depreciation/Amortisation Earnings before Interest and Tax Net Interest Expense / (Income) Tax Expense Net Profit after Tax Interim Dividend (US$) Basic EPS (US$)	881 912 897 1.8% 98 94 96 783 818 801 2.3% 7 16 14 151 157 151
	625 646 636 1.7%
	0.50 1.24 0.53 1.33 1.31 6.0% 5.4%

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12 February 2014

(#) Constant currency removes the impact of exchange rate movements to facilitate comparability by restating the current year’s results at the prior year’s rates. This is done in two parts: (a) by converting the current year net profit of entities in the group that have reporting currencies other than US Dollars at the rates that were applicable to the prior year (“translation currency effect”); and (b) by restating material transactions booked by the group that are impacted by exchange rate movements at the rate that would have applied to the transaction if it had occurred in the prior year (“transaction currency effect”). The sum of translation currency effect and transaction currency effect is the amount by which reported net profit is adjusted to calculate the result at constant currency.

Summary NPAT
Reported Net Profit after Tax	$645.7m
Translation Currency Effect (a)	$ ( 9.1m)
Transaction Currency Effect (b)	$ (1.1m)
Constant Currency Net Profit after Tax *	$635.5m

(a) Translation Currency Effect ($9.1m)

Average Exchange rates used for calculation in major currencies (six months to Dec 13/Dec 12) were as follows: USD/EUR (0.75/0.79); USD/CHF(0.92/0.95)

(b) Transaction Currency Effect ($1.1m)

Transaction currency effect is calculated by reference to the applicable prior year exchange rates. The calculation takes into account the timing of sales both internally within the CSL Group (ie from a manufacturer to a distributor) and externally (ie to the final customer) and the relevant exchange rates applicable to each transaction.

Summary Sales
Reported Sales	$2,574.2m
Currency Effect (c)	$21.0 m
Constant Currency Sales *	$2,595.2m

c) Constant Currency Effect $21.0m

Constant currency effect is presented as a single amount due to the complex and interrelated nature of currency impacts on sales.

• Constant Currency Net Profit after Tax and Sales have not been audited or reviewed in accordance with Australian Auditing Standards.

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CSL Limited

ABN: 99 051 588 348

ASX Half-year Information 31 December 2013

Lodged with the ASX under Listing Rule 4.2A. This information should be read in conjunction with the 30 June 2013 Annual Report.

Contents

Page

Results for Announcement to the Market

Half-year Report

1 3

CSL Limited

ABN: 99 051 588 348

Appendix 4D Half-year ended 31 December 2013

(Previous corresponding period: Half-year ended 31 December 2012)

Results for Announcement to the Market

Reported

• Revenues from continuing operations up 4.6% to US$2.7 billion.

• Net profit after tax for the period attributable to members up 3.4% to US$645.7 million.

Constant Currency[1]

• Sales revenue at constant currency up 5% to US$2.6 billion.

• Net profit after tax for the period at constant currency up 2% to US$635.5 million.

Dividends

Dividends
	Amount per	Franked amount per
	security (US cents)	security (US cents)
Interim dividend (determined subsequent to balance date)	53.00¢	Unfranked*
Interim dividend from the previous corresponding period	50.00¢	Unfranked
Final dividend (prior year)	52.00¢	Unfranked
Record datefordetermining entitlements to the dividend:	12 March 2014

* Under Australian law non-resident withholding tax is not payable on the unfranked component of this dividend as that portion will be declared to be wholly conduit foreign income.

The Company's Dividend Reinvestment Plan remains suspended and does not apply to the interim dividend.

Explanation of results

For further explanation of the results please refer to the accompanying press release and “Review of Operations” in the Directors’ Report that is within the Half-year Report.

The half year financial statements are presented in US$ unless otherwise stated.

Other information required by Listing Rule 4.3A

The remainder of the information requiring disclosure to comply with Listing Rule 4.3A is contained in the attached Half-year Report (which includes the Directors’ Report) and Media Release.

1

1 Constant currency removes the impact of exchange rate movements to facilitate comparability by restating the current year’s results at the prior year’s rates. This is done in two parts: (a) by converting the current year net profit of entities in the group that have reporting currencies other than US Dollars at the rates that were applicable to the prior year (“translation currency effect”); and (b) by restating material transactions booked by the group that are impacted by exchange rate movements at the rate that would have applied to the transaction if it had occurred in the prior year (“transaction currency effect”). The sum of translation currency effect and transaction currency effect is the amount by which reported net profit is adjusted to calculate the result at constant currency.

Summary NPAT Reported Net Profit after Tax $645.7m Translation Currency Effect (a) $ ( 9.1m) Transaction Currency Effect (b) $ (1.1m) Constant Currency Net Profit after Tax * $635.5m

(a) Translation Currency Effect ($9.1m)

Average Exchange rates used for calculation in major currencies (six months to Dec 13/Dec 12) were as follows: USD/EUR (0.75/0.79); USD/CHF(0.92/0.95)

(b) Transaction Currency Effect ($1.1m)

Transaction currency effect is calculated by reference to the applicable prior year exchange rates. The calculation takes into account the timing of sales both internally within the CSL Group (ie from a manufacturer to a distributor) and externally (ie to the final customer) and the relevant exchange rates applicable to each transaction.

Summary Sales Reported Sales $2,574.2m Currency Effect (c) $21.0 m Constant Currency Sales * $2,595.2m

c) Constant Currency Effect $21.0m

Constant currency effect is presented as a single amount due to the complex and interrelated nature of currency impacts on sales.

• Constant Currency Net Profit after Tax and Sales have not been audited or reviewed in accordance with Australian Auditing Standards.

2

CSL Limited Half-year Report – 31 December 2013

Contents	Page
Directors’ Report	4
Auditor’s Independence Declaration	6
Consolidated Statement of Comprehensive Income	7
Consolidated Balance Sheet	8
Consolidated Statement of Changes in Equity	9
Consolidated Statement of Cash Flows	10
Notes to the Financial Statements	11
Directors’ Declaration	25
Independent Review Report to the Members of CSL Limited	26

This Interim Financial Report does not include all the notes of the type normally included in an Annual Financial Report. Accordingly, this report is to be read in conjunction with the Annual Report for the year ended 30 June 2013 and any public announcements made by CSL Limited during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001 .

3

CSL Limited Directors’ Report

The Board of Directors of CSL Limited has pleasure in presenting their report on the consolidated entity for the half-year ended 31 December 2013.

Directors

The following persons were Directors of CSL Limited during the whole of the half-year and up to the date of this report:

Professor J Shine, AO (Chairman) Mr P R Perreault (Managing Director and Chief Executive Officer) Mr J H Akehurst Mr D W Anstice Mr B R Brook Ms C E O’Reilly Mr M A Renshaw

Ms M E McDonald was appointed director from 14 August 2013 and continues in office at the date of this report.

Mr I A Renard, AM was a director from the beginning of the financial year until his retirement on 16 October 2013.

Review of Operations

For the half year ended 31 December 2013, total revenue was of the Group was US$2.7 billion, up 5% compared to the prior comparative period. Reported net profit after tax was US$646 million for the six months ended 31 December 2013, up 3% when compared to the prior comparative period.

CSL Behring sales of US$2.4 billion grew 6% in constant currency terms, when compared to the prior comparable period.

Immunoglobulin product sales of US$1,085 million grew 7% in constant currency terms in a global market that remains robust. Demand for subcutaneous immunoglobulin (SCIG) was strong in both the U.S. and Europe. Hizentra[®] offers patients the convenience of self administration at home.

Intravenous immunoglobulin sales growth was underpinned by strong demand for Carimune[®] in the US and Brazil. Privigen also contributed to growth, benefiting from a full six months of sales with an expanded indication in Europe to include its use in the treatment of chronic inflammatory demyelinating polyneuropathy.

Albumin sales of US$313 million grew 7% in constant currency terms. Albumin demand in Europe was solid, boosted by cautionary statements from the regulator in relation to the use of hydroxyethyl starches, which are sometimes used as an alternative to albumin. This growth follows a very strong prior comparable period, which was driven by sales in China.

Haemophilia product sales of US$550m million declined 4% in constant currency terms. Humate[®] sales in the U.S. were strong arising from increased usage in surgery. However, this was offset by the conclusion of a number of treatment programs for immune tolerance therapy patients. In addition the timing of plasma derived haemophilia product sales in tender markets can be uneven. Recombinant FVIII sales declined 1% in constant currency terms, influenced by the number of clinical trials underway for new generation recombinant factor VIII products where patients receive clinical trial products at no cost.

Specialty products sales of US$403 million grew 16% in constant currency terms. In April 2013 the U.S. Food and Drug Administration (FDA) approved Kcentra[®] for urgent warfarin reversal in patients with acute major bleeding. This was followed in December 2013 with approval for an expanded indication to include the urgent reversal of acquired coagulation factor deficiency induced by vitamin K antagonist (e.g. warfarin) therapy in adult patients needing urgent surgery or other invasive procedures. These developments have underpinned

4

strong growth in U.S. demand for Kcentra[®] . In August 2013 the U.S. Centres for Medicare and Medicaid Services approved a new technology add-on payment for Kcentra[®] recognising its significant clinical advancement for reversing the effects of warfarin in patients who experience acute major bleeding. Kcentra[®] was granted Orphan Drug Marketing Exclusivity for a period of 7 years effective December 2013 based on the approved surgical indication.

Strong demand continues for Berinert[®] , which is used for the treatment of acute attacks in patients with hereditary angioedema. The U.S. FDA approval in 2012 of a label expansion to include self administration is underpinning new patient take up.

bioCSL sales of US$217 million declined 7% in constant currency terms. Influenza sales totalled A$94m. Strong demand in the US was more than offset by a reduction in European sales following market exit by bioCSL’s business partner in that region. GARDASIL* sales grew strongly arising from higher than expected uptake in Australia.

CSL Intellectual Property revenue was US$101 million, driven by granting of a license to Janssen Biotech, Inc., to progress CSL’s acute myeloid leukaemia product currently in development. Also contributing to growth were royalty contributions from Human Papillomavirus Vaccines.

Auditor’s independence declaration

A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 6.

Rounding of Amounts

The amounts contained in this report and in the financial report have been rounded to the nearest hundred thousand dollars (where rounding is applicable) unless specifically stated otherwise under the relief available to the Company under ASIC Class Order 98/0100. The Company is an entity to which the Class Order applies.

This report has been made in accordance with a resolution of the directors.

John Shine AO Chairman

Paul Perreault Managing Director

12 February 2014

5

Ernst & Young 8 Exhibition Street Melbourne VIC 3000 Australia GPO Box 67 Melbourne VIC 3001

Tel: +61 3 9288 8000 Fax: +61 3 8650 7777 ey.com/au

Auditor’s Independence Declaration to the Directors of CSL Limited

In relation to our review of the financial report of CSL Limited for the half-year ended 31 December 2013, to the best of my knowledge and belief, there have been no contraventions of the auditor independence requirements of the Corporations Act 2001 or any applicable code of professional conduct.

Ernst & Young

Glenn Carmody Partner 12 February 2014

6

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

CSL Limited and its controlled entities Consolidated Statement of Comprehensive Income For the half-year ended 31 December 2013

		Consolidated Entity	Consolidated Entity
		December	December
		2013	2012
			restated
	Notes	**US$m **	US$m
Sales revenue		2,574.2	2,482.3
Cost of sales		(1,231.2)	(1,188.9)
Gross profit		1,343.0	1,293.4
Other revenue	4(a)	127.5	101.4
Research and development expenses		(229.3)	(190.2)
Selling and marketing expenses		(242.1)	(242.3)
General and administration expenses	4(c)	(170.4)	(162.5)
Finance costs	4(b)	(26.3)	(24.4)
Profit before income tax expense		802.4	775.4
Income tax expense	5	(156.7)	(150.8)
Net profit for the period		**645.7 **	624.6
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Exchange differences on translation of foreign operations, net of
hedges on net foreign investments	11	75.1	129.3
Items that will not be reclassified subsequently to profit or loss
Actuarial gains/(losses) on defined benefit plans, net of tax		19.3	(30.2)
Total other comprehensive income/(expense)		94.4	99.1
Total comprehensive income for theperiod		740.1	723.7
Earnings per share(based on netprofit for theperiod)		Cents	Cents
Basic earnings per share	6	133.02	124.22
Diluted earnings per share	6	132.59	123.84

7

CSL Limited and its controlled entities Consolidated Balance Sheet As at 31 December 2013

Consolidated Balance Sheet As at 31 December 2013
		Consolidated	Entity
		December	June
		2013	2013
			restated
	Notes	**US$m **	US$m
CURRENT ASSETS
Cash and cash equivalents	7	694.0	762.2
Trade and other receivables		920.8	850.5
Inventories		1,696.2	1,639.4
Current tax assets		53.1	6.7
Other financial assets		2.9	0.5
Total Current Assets		3,367.0	3,259.3
NON-CURRENT ASSETS
Trade and other receivables		8.6	8.6
Other financial assets		1.0	1.0
Property, plant and equipment	8	1,684.4	1,587.2
Deferred tax assets		276.2	262.3
Intangible assets		895.7	855.7
Retirement benefit assets	14	4.5	-
Total Non-Current Assets		2,870.4	2,714.8
TOTAL ASSETS		6,237.4	5,974.1
CURRENT LIABILITIES
Trade and other payables		546.5	647.9
Interest-bearing liabilities	9	6.5	5.7
Current tax liabilities		156.2	159.9
Provisions		76.4	88.4
Deferred government grants		0.9	0.9
Derivative financial instruments		2.6	3.8
Total Current Liabilities		789.1	906.6
NON-CURRENT LIABILITIES
Trade and other payables		11.7	23.2
Interest bearing liabilities	9	1,785.4	1,673.2
Deferred tax liabilities		127.2	115.0
Provisions		34.0	34.2
Deferred government grants		38.4	37.0
Retirement benefit liabilities	14	159.0	167.2
Total Non-Current Liabilities		2,155.7	2,049.8
TOTAL LIABILITIES		2,944.8	2,956.4
NET ASSETS		3,292.6	3,017.7
EQUITY
Contributed equity	10	(2,190.5)	(1,978.3)
Reserves	11	656.2	578.3
Retained earnings		4,826.9	4,417.7
TOTAL EQUITY		3,292.6	3,017.7

8

CSL Limited and its controlled entities Consolidated Statement of Changes in Equity For the half year ended 31 December 2013

		Ordinary	Foreign	Share	Retained	Total
		shares	currency	based	earnings
			translation	payment
			reserve	reserve
		US$m	US$m	US$m	US$m	US$m
At 1 July 2013		(1,978.3)	451.3	127.0	4,417.7	3,017.7
Profit for the period		-	-	-	645.7	645.7
Othercomprehensiveincome		-	75.1	-	19.3	94.4
Total comprehensive income for the half year		-	75.1	-	665.0	740.1
Transactions with owners in
their capacity as owners
Share based payments	11	-	-	2.8	-	2.8
Dividends	12	-	-	-	(255.8)	(255.8)
Share buy back	10	(233.9)	-	-	-	(233.9)
Share issues
- Employee share scheme	10	13.1	-	-	-	13.1
Taxadjustment 1	10	8.6				8.6
Balance as at 31 December 2013		(2,190.5)	526.4	129.8	4,826.9	3,292.6
At 1 July 2012		(869.1)	536.6	96.3	3,712.9	3,476.7
Adjustment arising from the adoption of AASB119		-	-	-	11.4	11.4
Profit for the period		-	-	-	624.6	624.6
Othercomprehensiveincome		-	129.3	-	(30.2)	99.1
Total comprehensive income for
the half year		-	129.3	-	594.4	723.7
Transactions with owners in
their capacity as owners
Share based payments	11	-	-	11.3	-	11.3
Dividends	12	-	-	-	(247.1)	(247.1)
Share buy back		(473.6)	-	-	-	(473.6)
Share issues
- Employee share scheme		29.5	-	-	-	29.5
Taxadjustment 1		(8.8)				(8.8)
Balance as at 31 December 2012		(1,322.0)	665.9	107.6	4,071.6	3,523.1

1 In the period ended 31 December 2013 the Group successfully resolved an outstanding tax matter with the ATO relating to equity raising costs. In the prior comparative period CSL had received amended assessment notices and had reversed the benefit originally recognised in the 2009 financial year. The successful resolution of the matter reinstates the original benefit.

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CSL Limited and its controlled entities Consolidated Statement of Cash Flows For the half-year ended 31 December 2013

CSL Limited and its controlled entities Consolidated Statement of Cash Flows For the half-year ended 31 December 2013
		Consolidated Entity
		December	December
		2013	2012
	Notes	**US$m **	US$m
Cash flows from Operating Activities
Receipts from customers (inclusive of goods and services tax)		2,682.0	2,564.4
Payments to suppliers and employees (inclusive of goods and
services tax)		(1,949.3)	(1,722.0)
		732.7	842.2
Interest received		10.8	19.7
Income taxes paid		(206.6)	(167.8)
Borrowingcosts		(24.4)	(24.1)
Net cash inflow /(outflow)from operatingactivities		512.5	670.2
Cash flows from Investing Activities
Proceeds from sale of property, plant and equipment		0.1	-
Payments for property, plant and equipment		(170.4)	(231.9)
Payments for intangible assets		(18.6)	(5.2)
Receipts from other financial assets		-	0.2
Net cash inflow /(outflow)from investingactivities		(188.9)	(236.9)
Cash flows from Financing Activities
Proceeds from issue of shares		13.1	29.5
Payment for shares bought back		(241.7)	(480.8)
Dividends paid		(255.8)	(247.1)
Receipts on closure of foreign exchange hedges		-	0.1
Proceeds from borrowings	9	100.0	-
Repayment of borrowings	9	(1.9)	(170.0)
Net cash inflow /(outflow)from financingactivities		(386.3)	(868.3)
Net increase (decrease) in cash and cash equivalents		(62.7)	(435.0)
Cash and cash equivalents at the beginning of the period		759.8	1,168.2
Exchange rate variations on foreign cash and cash equivalent
balances		(7.3)	18.5
Cash and cash equivalents at the end of theperiod		689.8	751.7
Reconciliation of cash and cash equivalents
Cash and cash equivalents at the end of the period as shown in the
statement of cash flows is reconciled as follows:
Cash and cash equivalents	7	694.0	756.7
Bank overdrafts		(4.2)	(5.0)
		689.8	751.7

10

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

1 Corporate Information

CSL Limited is a for-profit company incorporated and domiciled in Australia and limited by shares publicly traded on the Australian Securities Exchange. This financial report covers the financial statements for the consolidated entity consisting of CSL Limited and its subsidiaries (together referred to as the Group). The financial report was authorised for issue in accordance with a resolution of the directors on 12 February 2014. A description of the nature of the Group’s operations and its principal activities is included in the directors’ report.

2 Summary of Significant Accounting Policies

The principal accounting policies adopted in the preparation of the financial report are set out below. These policies have been consistently applied to all the years presented unless otherwise stated.

(a) Basis of Accounting

The half-year financial report does not include all notes of the type normally included within the annual financial report and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of the consolidated entity as the full financial report. The half-year financial report should be read in conjunction with the annual financial report of CSL Limited as at 30 June 2013.

It is also recommended that the half-year financial report be considered together with any public announcements made by CSL Limited and its controlled entities during the half-year ended 31 December 2013 in accordance with the continuous disclosure obligations arising under ASX listing rules.

(b) Basis of Preparation

The half-year consolidated financial report is a general-purpose financial report, which has been prepared in accordance with the requirements of the Corporations Act 2001, applicable Accounting Standards, including AASB 134 Interim Financial Reporting and other mandatory professional reporting requirements.

The half-year financial report has been prepared under the historical cost convention, except for “at fair value through profit and loss” financial assets and liabilities (including derivative instruments), that have been measured at fair value.

For the purpose of preparing the half-year financial report, the half-year has been treated as a discrete reporting period.

The consolidated financial statements are presented in US Dollars which is the Group’s presentation currency.

(c) Significant Accounting Policies

The half-year consolidated financial statements have been prepared using the same accounting policies as used in the annual financial statements for the year ended 30 June 2013, except for the adoption of new standards and interpretations effective as of 1 July 2013.

New standards, interpretations and amendments adopted by the Company

The Company applies, for the first time, certain standards and amendments that require restatement of previous financial statements. These include AASB 10 Consolidated Financial Statements , AASB 119 Employee Benefits and AASB 13 Fair Value Measurement. As required by AASB 134, the nature and the effect of these changes are disclosed below.

11

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

AASB 119 Employee Benefits AASB 119 includes a number of amendments to the accounting for defined benefit plans. These are:

• actuarial gains and losses can only be recognised in other comprehensive income (OCI) and permanently excluded from profit and loss, this is consistent with the Group’s previous accounting for this item;

• expected returns on plan assets that are no longer recognised in profit or loss, instead, there is a requirement to recognise interest on the net defined benefit liability (asset) in profit or loss, calculated using the discount rate used to measure the defined benefit obligation;

• unvested past service costs are now recognised in profit or loss at the earlier of when a change to the plan occurs or when the related restructuring or termination costs are recognised; and

• a recognition of risk sharing in the calculation of the defined benefit obligation.

There are also new disclosures such as quantitative sensitivity disclosures.

In case of the Company, the transition to AASB 119 had an impact on the net defined benefit plan obligations and contribution expense due to the adoption of risk sharing and the differences in accounting for interest on plan assets.

The effect of the adoption of AASB119 has been applied retrospectively and the prior period comparatives have been adjusted accordingly. Refer to Note 14 for details of the adjustments.

AASB 7 Financial Instruments: Disclosures: Offsetting Financial Assets and Financial Liabilities

The amendment requires an entity to disclose information about rights to set-off financial instruments and related arrangements (e.g., collateral agreements). As the Group is not setting off financial instruments in accordance with AASB 7 and does not have relevant offsetting arrangements, the amendment does not currently have an impact on the Company.

AASB 13 Fair Value Measurement

AASB 13 establishes a single source of guidance under IFRS for all fair value measurements. AASB 13 does not change when an entity is required to use fair value, but rather provides guidance on how to measure fair value under IFRS when fair value is required or permitted. The application of AASB 13 has not materially impacted the fair value measurements carried out by the Company.

The Company has not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective.

(d) Basis of Consolidation

The half-year consolidated financial statements comprise the financial statements of CSL Limited and its subsidiaries as at 31 December 2013 ('the Group').

12

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

3 Segment Information

Reportable segments are:

• (a) CSL Behring – manufactures, markets and develops plasma therapies (plasma products and recombinants).

• (b) bioCSL – manufactures and distributes non-plasma biotherapeutic products.

• (c) CSL Intellectual Property – revenue and associated expenses from the licensing of Intellectual Property generated by the Group to unrelated third parties and Research & Development expenses on projects where the company has yet to determine the ultimate commercialisation strategy.

Geographical areas of operation

The Group operates predominantly in three specific geographic areas, namely Australia, the United States of America, and Germany. The rest of the Group’s operations are spread across many countries and are collectively disclosed as ‘Rest of World’ in note 3.

Segment Accounting Policies

Inter-segment sales are carried out on an arm’s length basis and reflect current market prices. Segment accounting policies are the same as the Group’s policies described in note 2. During the financial year, there were no changes in segment accounting policies.

Restatement of prior year comparables

The company undertook an internal reorganisation of its Australian business with effect from 1 January 2013. With effect from that date the Australian plasma operations of the company were integrated with CSL Behring and bioCSL was established as a standalone business focussing on the manufacturing and supply of biotherapeutic products. Previously both operations had been components of the Other Human Health segment.

The final component of the Other Human Health segment was Research & Development expenses on projects where the company has yet to determine the ultimate commercialisation strategy. Expenses relating to these projects are now included in the new segment “CSL Intellectual Property”. This new segment incorporates income generated by the Group from the commercialisation of intellectual property with unrelated third parties. This was previously reported in the Intellectual Property segment.

The new definition has been applied to the comparative financial information as if the changes in structure had been effective from 1 July 2012, this has been done to facilitate comparability over multiple reporting periods.

13

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

3 Segment information (continued)

			CSL
			Intellectual	Intersegment	Consolidated
	CSL Behring	bioCSL	Property	Elimination	Group
	December	December	December	December	December
	2013	2013	2013	2013	2013
	**US$m **	**US$m **	**US$m **	**US$m **	**US$m **
Sales to external customers	2,356.9	217.3	-	-	2,574.2
Inter-segment sales	-	-	-	-	-
Other revenue / Other income (excl interest income)	2.0	13.7	101.1	-	116.8
Total segment revenue	2,358.9	231.0	101.1	-	2,691.0
Interest income					10.7
Unallocated revenue / income					-
Consolidated revenue					2,701.7
Segment EBIT	792.8	14.1	41.8	-	848.7
Unallocated revenue / income less
unallocated costs					(30.7)
Consolidated EBIT					818.0
Interest income					10.7
Finance costs					(26.3)
Consolidated profit before tax					802.4
Income tax expense					(156.7)
Consolidated netprofit after tax					645.7
Amortisation	15.0	-	-	-	15.0
Depreciation	62.6	6.9	3.5	-	73.0
Segment EBITDA	870.4	21.0	45.3	-	936.7
Unallocated revenue / income less
unallocated costs					(30.7)
Unallocated depreciation and amortisation					6.2
Consolidated EBITDA					912.2

14

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

3 Segment information (continued)

CSL Behring December 2013 US$m	bioCSL December 2013 US$m CSL Intellectual Property December 2013 US$m Intersegment Elimination December 2013 US$m Consolidated Group December 2013 US$m
Segment assets 5,520.0 Other unallocated assets Elimination of amounts between operating segments and unallocated	373.5 30.2 (92.2) 5,831.5 497.7 (91.8)
Total assets	6,237.4
Segment liabilities 2,077.2 Other unallocated liabilities Elimination of amounts between operating segments and unallocated	123.9 4.6 (92.2) 2,113.5 923.1 (91.8)
Total liabilities	2,944.8

			CSL
			Intellectual	Intersegment	Consolidated
	CSL Behring	bioCSL	Property	Elimination	Group
	December	December	December	December	December
	2012	2012	2012	2012	2012
	restated	restated	restated	restated	restated
	**US$m **	**US$m **	**US$m **	**US$m **	**US$m **
Sales to external customers	2,232.7	249.6	-	-	2,482.3
Inter-segment sales	-		-	-	-
		-
Other revenue / Other income (excl interest
income)	2.0	10.1	71.9	-	84.0
Total segment revenue	2,234.7	259.7	71.9	-	2,566.3
Interest income					17.1
Unallocated revenue / income					0.3
Consolidated revenue					2,583.7
Segment EBIT	795.2	11.0	10.7	-	816.9
Unallocated revenue / income less unallocated
costs					(34.2)
Consolidated EBIT					782.7
Interest income					17.1
Finance costs					(24.4)
Consolidated profit before tax					775.4
Income tax expense					(150.8)
Consolidated netprofit after tax					624.6
Amortisation	14.8	-	-	-	14.8
Depreciation	57.9	13.5	4.2	-	75.6
Segment EBITDA	867.9	24.5	14.9	-	907.3
Unallocated revenue / income less unallocated
costs					(34.2)
Unallocated depreciation and amortisation					7.5
Consolidated EBITDA					880.6

15

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

==> picture [492 x 35] intentionally omitted <==

3 Segment information (continued)

3 Segment information (continued)
	CSL Behring June 2013 restated **US$m **	bioCSL June 2013 restated **US$m **	CSL Intellectual Property June 2013 restated **US$m **	Intersegment Elimination June 2013 restated **US$m **	Consolidated Group June 2013 restated **US$m **
Segment assets Other unallocated assets Elimination of amounts between operating segments and unallocated	5,116.2	369.8	27.9	(54.2)	5,459.7 1,560.8 (1,046.4)
Total assets					5,974.1
Segment liabilities Other unallocated liabilities Elimination of amounts between operating segments and unallocated	2,103.1	121.1	4.2	(54.2)	2,174.2 1,828.6 (1,046.4)
Total liabilities					2,956.4

		United		Rest of
Geographic areas	Australia	States	Germany	world	Total
	US$m	US$m	US$m	US$m	US$m
December 2013
External sales revenue	272.5	979.2	387.7	934.8	2,574.2
December 2012
External sales revenue	308.5	946.4	385.8	841.6	2,482.3

16

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

4 Revenue, Income and Expenses from continuing operations

		Consolidated Entity	Consolidated Entity
		December	December
		2013	2012
			restated
		US$m	US$m
(a)	Other Revenue
	Interest income	10.7	17.1
	Rent	0.6	0.7
	Royalties	78.7	68.4
	Sundry	37.5	15.2
		127.5	101.4
(b)	Finance Costs
	Interest paid / payable	26.3	24.4
(c)	Other Expenses
	General and administration expenses:
	Expense of share based payments	20.4	23.2
	Amortisation of intellectual property and software	15.0	14.8
	Other relevant expenses
	Depreciation and amortisation of property, plant and equipment	79.2	83.1
	Net foreign exchange losses	15.1	3.3

5 Income Tax

The reconciliation between income tax expense and the consolidated entity’s applicable tax rate is as follows:

Profitfromcontinuing activities beforeincome taxexpense	802.4	775.4
Income tax calculated at 30%	240.7	232.6
Tax effect of non-assessable / non-deductible items
Research and development	(8.7)	(7.9)
Other (non-assessable revenue)/non-deductible expenses	(0.2)	(2.3)
Effects of different rates of tax on overseas income	(73.5)	(74.1)
Under(over) provision inprevious year	(1.6)	2.5
Income taxexpense	156.7	150.8

17

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

6 Earnings Per Share

	Consolidated Entity	Consolidated Entity
	December	December
	2013	2012
		restated
	US$m	US$m
The following reflects the income and share information used in the
calculation of basic and diluted earnings per share:
Earnings usedincalculating basic earnings pershare	645.7	624.6
	Number of shares
	December	December
	2013	2012
Weighted average number of ordinary shares used in the calculation of basic
earnings per share:	485,354,422502,807,390
Effect of dilutive securities:
Share options	688,737	589,189
Performance rights	865,677	935,837
Globalemployee share plan	4,199	11,465
Adjusted weighted average number of ordinary shares used in calculating
diluted earnings pershare	486,913,035504,343,881

Refer to note 10 for a reconciliation of the movement in issued shares.

Conversions, calls, subscription or issues after 31 December 2013

Subsequent to the reporting date 622 ordinary shares were issued, as required under the Employee Performance Rights Plan. There have been no other ordinary shares issued since the reporting date and before the completion of this financial report. There have been no other conversions to, calls of, or subscriptions for ordinary shares or issues of potential ordinary shares since the reporting date and before the completion of this financial report.

7 Cash and cash equivalents

	Consolidated	Entity
	December	June
	2013	2013
	US$m	US$m
Cash at bank and on hand	332.5	203.5
Cashdeposits	361.5	558.7
Totalcashand cashequivalents	694.0	762.2

8 Property, Plant and Equipment

During the half-year ended 31 December 2013, the Group acquired assets with a cost of $164.9m (2012: $225.0m).

18

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

9 Borrowings and repayments

For the half year ended 31 December 2013, the Group has repaid $1.9m of interest bearing debt related to finance lease repayments and received proceeds in the amount of $100.0m from a drawdown on a 3[rd] party debt facility in the US.

As at balance date the Group had $291.8m in undrawn liquidity available under its bank debt facilities.

10 Contributed Equity

	Consolidated	Entity
	December	June
	2013	2013
	US$m	US$m
Ordinary shares issued and fully paid	-	-
Share buy-back reserve	(2,190.5)	(1,978.3)
Totalcontributed equity	(2,190.5)	(1,978.3)

Ordinary shares have the right to receive dividends as declared and, in the event of winding up the company, to participate in the proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up on shares held. Ordinary shares entitle their holder to one vote, either in person or proxy, at a meeting of the company.

Due to share buy-backs, the balance for ordinary share contributed equity has been reduced to nil, and a reserve created to reflect the excess value of shares bought over the original amount of subscribed capital.

Movements in the contributed equity

	Number of	US$m
	Shares
Ordinary shares
Balance as at 1 July 2013	487,352,182	(1,978.3)
Shares issued to CSL employees through participation in:
- Performance Option Plan	322,138	9.9
- Performance Rights Plan	208,632	-
- Global Employee Share Plan	68,515	3.2
Shares acquired under the Share Buy Back	(3,838,109)	(233.9)
Taxadjustment	-	8.6
Balance as at 31 December 2013	484,113,358	(2,190.5)

19

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

11 Reserves

	Consolidated	Entity
	December	June
	2013	2013
	US$m	US$m
Composition
Share based payments reserve (i)	129.8	127.0
Foreigncurrency translation reserve (ii)	526.4	451.3
	656.2	578.3

Nature and purpose of reserves

(i) Share based payments reserve

The share based payments reserve is used to recognise the fair value of options and performance rights issued but not exercised.

(ii) Foreign currency translation reserve

As disclosed in note 2b, the Group’s presentation currency is US dollars. Operating results are translated into US dollars at average exchange rates for subsidiaries with a functional currency other than US dollars. For those subsidiaries, assets and liabilities are translated to US dollars at exchange rates prevailing at balance date and resulting exchange differences are recognised in the foreign currency translation reserve in equity. On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of borrowings and other financial instruments designated as hedges of such investments, are taken to the foreign currency translation reserve in equity.

12 Dividends

	Consolidated Entity	Consolidated Entity
	December	December
	2013	2012
	US$m	US$m
Ordinary shares
Dividends providedfororpaid during thehalf-year	255.8	247.1
Dividends not recognised at the end of the half-year
Since the end of the half-year the directors have recommended the payment of
an interim dividend of 53.00 US cents (2012 – 50.00 US cents) per fully paid
ordinary share, unfranked. The aggregate amount of the proposed interim
dividend expected to be paid on 4 April 2014 out of retained earnings at 31
December 2013, butnotrecognised as aliability at the end ofthehalf-year,is:	256.6	249.1

20

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

13 NTA Backing

13 NTA Backing
	December	June
	2013	2013
		restated
	$	$
Net tangible asset backing perordinary security	4.95	4.44

14 Retirement Benefit Liabilities

The Group sponsors a range of defined benefit pension plans that provide pension benefits for its worldwide employees upon retirement. Entities of the Group who operate the defined benefit plans contribute to the respective plans in accordance with the Trust Deeds, following the receipt of actuarial advice. Full details of the Group’s plans can be found in the June 2013 Financial Statements.

AASB119 has been applied retrospectively. There are two changes to prior period financials as a result of the application of the new standard.

AASB119 allows for the recognition of risk sharing where the plan members contribute to their benefit through increased contributions based on age, this has the effect of reducing the defined benefit obligation of the CSL Behring AG (Switzerland) plan which is the only Group plan that includes such risk sharing. This has reduced the amount of the defined benefit obligation as set out in the table below and is results in a change in the value of Retirement Benefit Liabilities in the Balance Sheet. In accordance with the requirements of AASB 108 Changes in Accounting Estimates and Errors the offsetting amount is reflected in Retained Earnings brought forward.

Expected returns on plan assets of defined benefit plans are no longer a component of the calculation of defined benefit contributions charged to the profit and loss. Instead, interest on net defined benefit obligation net of the plan assets for the Group’s funded plans (those in Switzerland, USA and Australia) is recognised in profit or loss, calculated using the discount rate used to measure the net pension obligation or asset. This has increased the contribution expense recognised in the prior period, this adjustment is tax effected and the resultant reduction in net profit after tax is offset by an increase in Other Comprehensive Income.

Impact of transition to AASB119 :

Impact of transition to AASB119:
	As at	As at
	December 2012 June 2013
	US$m	US$m
Impact of the adoption of Risk Sharing
Decrease/(increase) in the defined benefit plan obligation (non current)	12.8	(0.5)
Decrease in deferred tax asset (non current)	1.4	-
Increase/(decrease) in Opening Retained Earnings	11.4	(0.5)
Impact of the calculation of defined benefit contribution expense
Restatement of Defined benefit contribution expense	3.0	6.1
Tax Effect	0.7	1.2
Restatement of Other Comprehensive Income	2.3	4.9

21

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

December 2013 US$m Movements in the net liability for defined benefit obligations recognised in the balance sheet Net liability for defined benefit obligation: Opening balance 167.2 Contributions received (8.7) Benefits paid (1.8) Expense recognised in the statement of comprehensive income 2.2 Actuarial (gains)/losses recognised in equity (9.3) Currency translationdifferences 4.9	December 2013 US$m Movements in the net liability for defined benefit obligations recognised in the balance sheet Net liability for defined benefit obligation: Opening balance 167.2 Contributions received (8.7) Benefits paid (1.8) Expense recognised in the statement of comprehensive income 2.2 Actuarial (gains)/losses recognised in equity (9.3) Currency translationdifferences 4.9
	Closing balance 154.5

Defined Benefit Plan liabilities are discounted to present value using a corporate or government bond rate as at the date of the Actuarial assessment. Over the six months to December 2013 most jurisdictions in which the Group operates Defined Benefit Plans have experienced a modest decrease in the appropriate discount rate.

ount rate.
	December	June
	2013	2013
The principal actuarial assumptions at the balance sheet date
(expressed as weighted averages) are as follows:
Discount rate	2.6%	2.5%
Future salary increases	2.3%	2.2%
Future pension increases	0.4%	0.4%

22

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

15 Share Based Payment Plans

(a) Long Term Incentives

On 1 October 2013, 142,240 performance rights were granted to senior executives under the CSL Performance Rights Plan. The exercise price for the performance rights is Nil. The performance rights will become exercisable between 30 September 2016 and 30 September 2018. The fair value of the performance rights granted is estimated as at the date of grant using an adjusted form of the Black-Scholes model, taking into account the terms and conditions upon which the performance rights were granted.

Performance rights granted in October 2013 have two performance hurdles with each hurdle applying to half of each tranche. The performance rights tested against an Earnings per Share (EPS) hurdle will vest on a sliding scale with 50% of the rights vesting if the group achieves 8% compound annual growth in USDdenominated EPS over the relevant period, rising to 100% vesting if the compound annual growth rate in USD-denominated EPS reaches 12% over the relevant period. The performance rights tested against a comparator group will only vest if the total shareholder return for CSL, denominated in USD, exceeds the growth in the MSCI Gross Pharma Index for the relevant period.

The following table lists the inputs to the model used for performance rights issued in the half-year ended 31 December 2013:

December 2013 Dividend yield (%) 2.0% Expected volatility (%) 21.0% Risk-free interest rate (%) 3.2% Fair Value of Performance Rights 3 year vesting A$49.86 4 year vesting A$49.00

(b) Executive Deferred Incentive Plan

On 1 October 2013, 351,100 notional shares were granted to employees under the Executive Deferred Incentive Plan. This plan provides for a grant of notional shares which will generate a cash payment to participants in three years time, provided they are still employed by the company and receive a satisfactory performance review over that period. The amount of the cash payment will be determined by reference to the CSL share price immediately before the three year anniversary.

The following table lists the inputs to the model used for grant issued in the half-year ended 31 December 2013:

	December
	2013
Dividend yield (%)	2.0%
Fair Value of Grant at reporting date, adjusted for the dividend yield and the number	A$66.19
of days left in the vesting period

23

CSL Limited and its controlled entities Notes to the financial statements For the half-year ended 31 December 2013

16 Commitments and contingencies

(a) Capital commitments

	December	June
	2013	2013
	US$m	US$m
During the half year, the capital expenditure contracted for but not provided
for in the financial statements, payable:
Not later than one year	68.2	101.5
Later than one year but not later than five years	0.1	6.1
Laterthan five years	-	-
	68.3	107.6

(b) Contingent assets and liabilities

Litigation

On 7 October 2013 the Group announced that it had signed an agreement to settle for $64m the US antitrust class action litigation in which the plaintiffs had claimed that the Group and a competitor, along with an industry trade association, conspired to restrict output and fix and raise prices of certain plasma-derived therapies in the U.S. The settlement was approved by the U.S. Federal Court as fair and reasonable on 22 January 2014 and is expected to become final on 30 March 2014. The settlement amount has been included as an expense in the half year ended 31 December 2013.

The Group is involved in other litigation in the ordinary course of business.

The directors believe that future payment of a material amount in respect of litigation is remote. The Group has disclaimed liability for, and is vigorously defending, all current material claims and actions that have been made.

24

CSL Limited Directors’ Declarations

The directors declare that:

• (a) the financial statements and notes of the consolidated entity are in accordance with the Corporations Act 2001, and:

• (i) give a true and fair view of the financial position as at 31 December 2013 and the performance for the half-year ended on that date of the consolidated entity; and

• (ii) comply with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 ; and

• (b) in the directors' opinion there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.

Made in accordance with a resolution of directors.

John Shine AO Chairman Melbourne 12 February 2014

Paul Perreault Managing Director

25

Ernst & Young 8 Exhibition Street Melbourne VIC 3000 Australia GPO Box 67 Melbourne VIC 3001

Tel: +61 3 9288 8000 Fax: +61 3 8650 7777 ey.com/au

To the members of CSL Limited

Report on the Half-Year Financial Report

We have reviewed the accompanying half-year financial report of CSL Limited, which comprises the consolidated balance sheet as at 31 December 2013, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the half-year ended on that date, notes comprising a summary of significant accounting and other explanatory information, and the directors’ declaration of the consolidated entity comprising the company and the entities it controlled at the half-year end or from time to time during the half-year.

Directors’ Responsibility for the Half Year Financial Report

The directors of the company are responsible for the preparation of the half-year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal controls as the directors determine are necessary to enable the preparation of the half-year financial report that is free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express a conclusion on the half-year financial report based on our review. We conducted our review in accordance with Auditing Standard on Review Engagements ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity , in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the financial report is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the consolidated entity’s financial position as at 31 December 2013 and its performance for the half-year ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 . As the auditor of CSL Limited and the entities it controlled during the period, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of a half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001 . We have given to the directors of the company a written Auditor’s Independence Declaration, a copy of which is included in the Directors’ Report.

Conclusion

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of CSL Limited is not in accordance with the Corporations Act 2001 , including:

• a) giving a true and fair view of the consolidated entity’s financial position as at 31 December 2013 and of its performance for the half-year ended on that date; and

• b) complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 .

Ernst & Young

Glenn Carmody Partner Melbourne 12 February 2014

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

CSL Limited 2013/14 Half Year Result 12 February 2014

Forward looking statements

The materials in this presentation speak only as of the date of these materials, and include forward looking statements about CSL Limited and its related bodies corporate (CSL) financial results and estimates, business prospects and products in research, all of which involve substantial risks and uncertainties, many of which are outside the control of, and are unknown to, CSL. You can identify these forward looking statements by the fact that they use words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “target,” “may,” “assume,” and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. Factors that could cause actual results to differ materially include: the success of research and development activities, decisions by regulatory authorities regarding approval of our products as well as their decisions regarding label claims; competitive developments affecting our products; the ability to successfully market new and existing products; difficulties or delays in manufacturing; trade buying patterns and fluctuations in interest and currency exchange rates; legislation or regulations that affect product production, distribution, pricing, reimbursement or access; litigation or government investigations, and CSL‟s ability to protect its patents and other intellectual property. The statements being made in this presentation do not constitute an offer to sell, or solicitation of an offer to buy, any securities of CSL.

No representation, warranty or assurance (express or implied) is given or made in relation to any forward looking statement by any person (including CSL). In particular, no representation, warranty or assurance (express or implied) is given in relation to any underlying assumption or that any forward looking statement will be achieved. Actual future events may vary materially from the forward looking statements and the assumptions on which the forward looking statements are based.

Subject to any continuing obligations under applicable law or any relevant listing rules of the Australian Securities Exchange, CSL disclaims any obligation or undertaking to disseminate any updates or revisions to any forward looking statements in these materials to reflect any change in expectations in relation to any forward looking statements or any change in events, conditions or circumstances on which any such statement is based. Nothing in these materials shall under any circumstances create an implication that there has been no change in the affairs of CSL since the date of these materials.

Trademarks

Except where otherwise noted, brand names designated by a ™or ® throughout this presentation are trademarks either owned by and/or licensed to CSL or its affiliates.

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Revenue US$2.7 billion, up 5% (up 6% @CC[1] ) EBIT US$818 million, up 5% (up 2% @CC) NPAT US$646 million, up 3% (up 2% @CC)

• Result includes one-off US antitrust class action settlement of US$64m, or US$39m after tax R&D investment increased to US$229 million EPS US$1.33, up 7% (up 5% @CC) Cashflow from operations US$513 million Interim dividend increased to US$0.53 (unfranked)

1. Constant Currency (CC) removes the impact of exchange rate movements to facilitate comparability. See end note for further detail.

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Hizentra[®]

• US approval for bi-weekly administration • Japanese approval for treatment of PID and SID Kcentra[® ] (4F-PCC) - Approved by US FDA for surgical use CSL 362 (AML) – license agreement with Janssen Biotech, Inc. CSL 112 (rHDL) – global phase IIb clinical trial commencing 2014 Alpha-1 – innovative diagnostic test kit launched A$950m share buyback* 22% complete Agreement to settle US antitrust class action litigation Establishing a sponsored Level 1 ADR program

* CSL reserves the right to suspend or terminate buybacks at any time

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Product
IPL
4% Groupings
Pharma &
Vaccines
8%
Specialty
Other
Products
8% IVIG 28%
15%
Peri-op 7%
Albumin 12% SCIG 9%
Hyper
pd Coag
rFVIII IG 4%
11%
9%
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ROW
9%
Australia
9%
North
America
Asia 10% 42%
Europe
30%
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1H14 US$2.6Bn

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Guidance, adjusted for US class action settlement, re-affirmed

• EBIT growth ~10% @ CC

• NPAT growth ~7% @ CC

• EPS will exceed NPAT growth driven by past and current capital management initiatives

Outlook statements are subject to:

Material price and volume movements on core plasma products, competitor activity, changes in healthcare regulations and reimbursement policies, royalties arising from the sale of Human Papillomavirus vaccine, implementation of the Company‟s influenza strategy and plasma therapy life cycle management strategies, enforcement of key intellectual property, regulatory risk, litigation, the effective tax rate and foreign exchange movements.

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US$M

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2,500
US$2,351m
US$2,228m
Specialty
Products
2,000
1,500
Immunoglobulins
1,000
Albumin
500
pdCoag
Helixate
0
Dec 12 Dec 13
Sales for the 6 month period
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US$M

1,200

US$1,085m

Highlights

US$1,015m

1,000

Normal IG up 8% @ CC

IVIG

800

• US

• Good market growth

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600
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400
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200
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0
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SCIG
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Dec 13
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Dec 12 Sales for the 6 month period

• Competitive pressure

• Europe

• New CIDP indication positive for demand

SCIG

• Ongoing strong demand for Hizentra[®] in US & EU

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US$M

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350
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300
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250
200
150
100
50
0
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US$313m
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US$294m
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US$294m
Albumin
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Highlights

Europe

• Solid demand following EMA‟s caution on use of hydroxyethyl starch solutions

China

• Ongoing strong demand

• Strong prior comparable period

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Dec 12 Dec 13
Sales for the 6 month period
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US$M

Highlights

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600
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US$565m
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US$550m
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PdFVIII

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pdCoag
Helixate
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500
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• Solid US demand for Humate[®] for use in surgery

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400
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• Tender markets tend to be „lumpy‟

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300
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Helixate[®]

• Multiple clinical trials in new generation rFVIII absorbing product otherwise for sale

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200
100
0
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Dec 12 Dec 13 Sales for the 6 month period

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450US$M

US$403m

Highlights

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400
US$355m
350
Other
Specialty
300
Products
250
200
150
Peri-
100 Operative
Bleeding
50
0
Dec 12 Dec 13
Sales for the 6 month period
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K-centra[®]

• Strong demand in US following approval & launch

• Orphan drug status

Berinert[® ] P

• Self administration label driving new patient take-up.

Zemaira[®]

• New patient acquisition

• Launch of diagnostic testing program

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Specialty Products Current Markets

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Inhibitors &
Others
HAE
Berinert
~ $700m
Haemocomplettan Fibrinogen Alpha-1 Zemaira
Riastap ~ $250m
~$700m
FY2013
Peri-Operative
Sales
Bleeding
$719m
Wound
Fibrogammin Other
Prothrombinex Healing TachoSil
~$50m Beriplast
~$200m
PCC
Beriplex
~$250m Kcentra
Wound Healing
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CSL Estimates of Target Markets

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A$M 300

250

200

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150
100
50
0
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Highlights

A$241m A$238m Pharma & vaccines

Influenza sales A$94m

• Increased US demand

• Growing US commercial operations

• European sales down after partner exits market Gardasil[*] sales strong following higher than expected uptake in Australia

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Influenza
Vaccine
Dec 13
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Dec 12
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Sales for the 6 month period

* Gardasil is a trademark of Merck & Co.

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Segment Revenue US$101m

HPV royalties $78m up $10m

• Growth in Gardasil* royalties

• Progression of 9-valent vaccine

a CSL362 (anti-IL-3R mAb)

• Phase I trial in AML in progress

• Exclusive worldwide license with Janssen Biotech Inc to develop and commercialise CSL362

• Collaborative research program to support use in other indications a

• CAM3001 (GM-CSFR )

• Medimmune/AstraZeneca continue Phase IIb studies in RA

• ISCOMATRIX[® ] adjuvant

• Merck Research Labs Phase I Dengue Study fully enrolled

* Gardasil is a trademark of Merck & Co.

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rIX-FP (rec fusion protein linking factor IX with albumin)

• Pivotal Phase III study enrolment complete

• Preliminary data demonstrates efficacy

rVIII-SingleChain

• Phase I/III study supports twice weekly dosing

• rVIIa-FP (rec fusion protein linking factor VIIa with albumin)

• Phase II/III trial in patients with inhibitors to commence in 2014

• Hizentra[®]

• Administration options in US and EU expanded to include dosing once every two weeks (biweekly)

• Approval in Japan for PID and SID

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Kcentra[® ] (4-Factor Prothrombin Complex Concentrate )

• FDA approval for expanded indication to include urgent Warfarin reversal in patients undergoing surgery (in addition to major bleeding)

Zemaira[®]

• Efficacy data from Phase III/IV study submitted in EU and US

• Berinert[®]

• Pivotal Phase III subcutaneous prophylaxis study commenced

• CSL112 (reconstituted High Density Lipoprotein)

• Phase IIa data supports mechanism of action and further development

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Business Performance 1H14

Financial Detail

• US antitrust class action settlement

• China PCP sales benefit

• AASB 119 – Employee Benefits

• Minor PCP adjustment

• Foreign Exchange

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Gearing

X 1.5 1.0

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~ Target
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0.5
0.0
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Net Debt / EBITDA

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-0.5 -1.0 -1.5 FY09 FY10 FY11 FY12 FY13

• Buyback 22% Complete

• Accumulated effect of buybacks since 2005 on current period EPS ~17%

• Gearing @1H14 0.6x

• Gearing target range ~1x Net debt/EBITDA

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US$M
US$M
3,000 250
Capex
2,500
200
Sales
2,000
150
1,500
100
1,000
50
500
0 0
1H10 1H12 1H14
6 month periods
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Capex
•
1H v 2H phasing
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Cashflow

• US litigation settlement

• Tax payment timing

• Net interest

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• American Depository Receipts (ADRs) are

• tradeable and transferrable financial instruments in the US capital markets

• One sponsored program to replace several unsponsored programs

• Facilitates engagement with existing and potential ADR holders

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Business Growth

Biotech mAbs in core therapeutic segments

CSL112 New treatment paradigm in ACS High margin contributor Recombinant Coagulation Factors rIX-FP, rVIII-SC, rVIIa-FP, rVWF Specialty Products Multiple high margin contributors: RiaSTAP[®] , Kcentra[™] , CytoGam[®] , Berinert[®] , Zemaira[®] Core Products Relentless Commitment to lowest cost base; Operational and Financial Strength and Efficiency. Continued Ig and Albumin growth through innovation and market expansion

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CSL Limited 2013/14 Half Year Result 12 February 2014

Six months ended Dec US$ Millions	Dec 2012 Reported Dec 2013 Reported Dec 2013 at CC1 Change %
Sales Other Revenue / Income Total Revenue / Income	2,482 84 2,567 2,574 117 2,691 2,595 117 2,713 4.5% 5.7%
Earnings before Interest, Tax, Depreciation & Amortisation Depreciation/Amortisation Earnings before Interest and Tax Net Interest Expense / (Income) Tax Expense Net Profit after Tax Final Dividend (US$) Basic EPS (US$)	881 912 897 1.8% 98 783 94 818 96 801 2.3% 7 151 16 157 14 151
	625 646 636 1.7%
	0.50 1.24 0.53 1.33 1.31 6.0% 5.4%

1. Constant Currency (CC) removes the impact of exchange rate movements to facilitate comparability. See end note for further detail.

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Half year ended December	1H13 USD$M 1H14 USD$M 1H14 USD$M CC1 Change %
rFVIII pdCoag Albumin Immunoglobulins Specialty Products - Wound healing - Peri-operative bleeding - Other specialty products Total Product Sales Other sales (mainly plasma) Total Sales	246 318 294 1,015 355 52 155 148 249 301 313 1,085 403 48 183 173 244 296 316 1,088 412 58 179 175 -1% -7% 7% 7% 16% 11% 15% 18%
	2,228 2,351 2,356 6%
	5 2,233 6 2,357

1. Constant Currency (CC) removes the impact of exchange rate movements to facilitate comparability. See end note for further detail.

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Notes

(#) Constant currency removes the impact of exchange rate movements to facilitate comparability by restating the current year‟s results at the prior year‟s rates. This is done in two parts: (a) by converting the current year net profit of entities in the group that have reporting currencies other than US Dollars at the rates that were applicable to the prior year (“translation currency effect”); and (b) by restating material transactions booked by the group that are impacted by exchange rate movements at the rate that would have applied to the transaction if it had occurred in the prior year (“transaction currency effect”). The sum of translation currency effect and transaction currency effect is the amount by which reported net profit is adjusted to calculate the result at constant currency.

Summary NPAT

Reported Net Profit after Tax $645.7m Translation Currency Effect (a) $ ( 9.1m) Transaction Currency Effect (b) $ (1.1m) Constant Currency Net Profit after Tax * $635.5m

(a) Translation Currency Effect ($9.1m)

Average Exchange rates used for calculation in major currencies (six months to Dec 13/Dec 12) were as follows: USD/EUR (0.75/0.79); USD/CHF(0.92/0.95)

(b) Transaction Currency Effect ($1.1m)

Transaction currency effect is calculated by reference to the applicable prior year exchange rates. The calculation takes into account the timing of sales both internally within the CSL Group (ie from a manufacturer to a distributor) and externally (ie to the final customer) and the relevant exchange rates applicable to each transaction.

Summary Sales

Reported Sales $2,574.2m Currency Effect (c) $21.0 m Constant Currency Sales * $2,595.2m

c) Constant Currency Effect $21.0m

Constant currency effect is presented as a single amount due to the complex and interrelated nature of currency impacts on sales.

• Constant Currency Net Profit after Tax and Sales have not been audited or reviewed in accordance with Australian Auditing Standards.

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