CSL share buyback could trigger cash avalanche for all investors BLOOD products company CSL has announced a $950m buyback in a move that could herald an avalanche of capital returns to shareholders across the equities market. Speaking at the company's annual meeting in Melbourne yesterday, chairman John Shine described the buyback -- CSL's seventh since 2008 -- as "an effective way to manage our capital that delivers improved investment returns for shareholders." Professor Shine said the company had returned $3.3 billion to shareholders via its previous six buybacks, in turn boosting earnings per share by more than 15 per cent. Richard Morrow, equity partner at stockbroker Baillieu Holst, said the CSL buyback could be the first in a string of capital returns from cashed-up companies. "There's a very good chance that there will be a lot more buybacks, particularly at the top end of the resources sector," he said. Mr Morrow said strong iron and copper prices over the past six months, an easing in the Australian dollar and a focus on cost-cutting meant a lot of miners would have "an embarrassing amount of cash." However, he said investors would prefer special dividends than buybacks, which did not always deliver a financial gain in the form of increased share prices. However, he noted companies with large proportions of earnings from offshore were less likely to pay special dividends as they paid fewer taxes in Australia and so lacked the franking credits to make dividends tax-effective for shareholders. The most recent annual reporting season saw dividend payouts increased by an average of 10 per cent, including special dividends announced by Coca-Cola Amatil, Suncorp, Wesfarmers, Westpac and Woodside. CSL's buyback, which will be conducted over the next 12 months, will be partly funded by a $US500 million ($525m) debt placement completed in March. At the meeting, Professor Shine said the company was trading in line with forecasts for net profit after tax to grow by around 10 per cent this financial year, assuming no move in exchange rates from last financial year. However, the result could be hit by a $US39 million one-off charge relating to the settlement of an anti-trust case, currently being assessed for approval by the US Federal Court. The charge would reduce NPAT growth to 7 per cent, again assuming no movement in exchange rates. Speaking after the meeting, his first since succeeding 23-year incumbent Brian McNamee in July, chief executive Paul Perreault said he didn't expect the US dollar to move against the company. "It's part of being a global company, you deal with the various currencies around and try to make sure you're paying attention; unfortunately we can't control that, so we'll just have to live with it and if things start to put pressure on we'll have to find other ways to make a better result," he said. We have opportunities in other markets . . . the expansion into new geographies, the growth in China, all of these areas we continue to focus on to look for those areas of continued growth. Mr Perreault said the US government shutdown had not affected the company's American operations, as the Food and Drug Administration was still processing drug approvals. A resolution to issue Mr Perreault with $1.6m worth of performance shares attracted a 'no' vote of almost 20 per cent, while the company's remuneration report was opposed by 10.7 per cent of shareholders voting on the resolution. CSL shares closed up 88c at $66.26 yesterday.