Australian biotech CSL delayed its vaccine division spin-off and cut earnings forecasts due to a larger-than-expected decline in U.S. flu vaccination rates, causing shares to drop by 16.6%. The company planned to spin off CSL Seqirus by June as part of a restructuring that included job cuts.

Despite high illness rates, U.S. flu vaccination rates declined more than expected, impacting CSL’s Seqirus business. This occurred despite positive U.S. administration recommendations and high infection rates. Health Secretary Robert F. Kennedy Jr’s anti-vaccine stance and FDA recommendations for 2025-2026 strains also affected the industry.

CSL reduced its full-year revenue guidance to 2-3% growth, down from 4-5%, and expects net profit after tax to rise by 4-7%, lower than the previous 7-10% estimate. The unexpected downgrade led to a sharp sell-off in CSL shares, surprising investors and prompting brokers to adjust their forecasts.

The Seqirus demerger will happen when market conditions support shareholder value maximization, according to CSL. Chair Brian McNamee emphasized that separation remains the best way to unlock growth for both businesses in the long term.

Read more at Yahoo Finance: Australia’s CSL delays spin-off as US flu vaccine rates decline