Fisher & Paykel Healthcare Corporation Limited (NZSX:FPH, ASX:FPH) announced today that its operating profit for the year ended 31 March 2009 grew 76%, compared to the prior year, to NZ$102.4 million. This was a result of very strong growth in its respiratory and acute care product group, new product introductions in its obstructive sleep apnea (OSA) range and favourable exchange rate movements. Profit after tax also grew 76% to NZ$62.2 million.
Operating revenue for the year ended 31 March 2009 increased 28% over the prior year to a record
NZ$458.7 million, and in US dollar terms, grew 10% to US$299.3 million.
Respiratory and acute care product group operating revenue increased by 34% to NZ$244.5 million and OSA product group operating revenue increased by 23% to NZ$202.6 million.
“Demand for our respiratory humidifier systems was exceptionally strong, assisted by substantial orders for hospital Group Purchasing Organisation (GPO) contracts in the United States and delivery of respiratory consumable backorders in the first half.
In the expanding OSA treatment market, constant currency revenue growth for total mask and flow generator operating revenue increased to 12% in the second half as we began to gain share with our new premium CPAP flow generators and masks”, commented Fisher & Paykel Healthcare’s CEO, Mr Michael Daniell.
“We continue to make very encouraging progress in developing new clinical applications for our technologies beyond our traditional invasive ventilation and OSA markets. These include patients requiring non-invasive ventilation, oxygen therapy, humidity therapy and laparoscopic surgery. These applications generated constant currency revenue growth of 55% over the prior year and contributed a quarter of our respiratory and acute care consumables revenue.”
The company’s directors have approved a final dividend for the financial year ended 31 March 2009 of 7.0 NZ cents per ordinary share (2008: 7.0 cents), carrying full imputation credit. Non-resident shareholders will receive a supplementary dividend of 1.2353 NZ cents per share. The final dividend will be paid on 6 July 2009, with a record date of 19 June, and an ex-dividend date of 15 June for the ASX and 22 June for the NZSX. The company will implement a dividend reinvestment plan under which shareholders may choose to reinvest all or part of their cash dividends in additional ordinary shares.
Research & Development, SG&A
Research and development expenses increased by 18% over the prior year to NZ$28.3 million, representing 6.2% of operating revenue. The company continued to expand its product and process research and development activities and current new product projects include flow generators, masks and additional respiratory care consumables. For the 2009 financial year the company has accrued in other income a one-time R&D tax credit of NZ$3 million.
Selling, general and administrative (SG&A) expenses grew 22% to NZ$118.9 million, or 13% in constant currency terms, as the company continued to expand its operations and its sales teams in North America, Europe, Asia/Pacific and South America.
Foreign Exchange Hedging
The company has in place a mix of foreign exchange contracts and collar options, up to five years forward, with a face value of approximately NZ$610 million. These instruments are at average rates of approximately 0.55 US dollars and 0.44 Euros to the New Zealand dollar for the 2010 financial year and are to protect the company from exchange rate volatility.
“This year we intend to invest significantly in expanding our sales and distribution operations, with plans to establish distribution and clinical sales support centres in four additional countries, including Japan. We will be expanding both our R&D activities and our manufacturing capacity in New Zealand, and will also establish an offshore manufacturing facility,” concluded Mr Daniell.
For the 2010 financial year the company expects to continue to achieve robust revenue growth and estimates that, at an average NZD:USD exchange rate of 0.60, it will achieve operating revenue of approximately NZ$540 million and profit after tax growth of about 25% to approximately NZ$75 million to NZ$80 million.
Financial Statements and Commentary
Attached to this news release are condensed NZ dollar financial statements and commentary. For convenience the income statement has been translated into US dollars.
The company’s financial statements for the year ended 31 March 2009 and the comparative financial information for the year ended 31 March 2008 have been prepared under the New Zealand equivalents to International Financial Reporting Standards (NZ IFRS).
Full Year Results Conference Call
Fisher & Paykel Healthcare will host a conference call today to review the results and to discuss
the outlook for the 2010 financial year. The conference call is scheduled to begin at 1:00pm NZST,
11:00am AEST (9:00pm USEDT) and will be broadcast simultaneously over the Internet.
To listen to the webcast, access the company’s website at www.fphcare.com. Please allow extra time prior to the webcast to visit the site and download the streaming media software if required. An online archive of the event will be available approximately two hours after the webcast and will remain onsite for two weeks.
Intending participants may register for the conference call prior to the event, using this link: http://www.fphcare.com/investor/conference. Once registered, participants will be assigned a conference Passcode and user PIN. Registered participants can dial in to one of the numbers below and use their codes for instant access to the conference. Alternatively, dial in to one of the numbers below a few minutes prior to the scheduled call time and identify yourself to the operator:
New Zealand Toll Free 0800 449 118
Australia Toll Free 1800 500 686
USA Toll Free 1866 369 4113
International +61 3 9221 4420
An audio replay of the conference call will be available approximately 60 minutes after the call and will be accessible for two weeks at +61 3 9221 4752, access code 043633.
About Fisher & Paykel Healthcare
Fisher & Paykel Healthcare is a leading designer, manufacturer and marketer of products and systems for use in respiratory care, acute care and the treatment of obstructive sleep apnea. The company’s products are sold in over 120 countries worldwide. For more information about the company visit www.fphcare.com
Contact: Michael Daniell MD/CEO on +64 9 574 0161 or Tony Barclay CFO on +64 9 574 0119.