Fisher & Paykel Healthcare Corporation Limited (NZSX:FPH, ASX:FPH) announced today that 27% revenue growth from its obstructive sleep apnea (OSA) product group contributed to record trading revenue of NZ$349.2 million for the year ended 31 March 2007.
Chief Executive Officer, Michael Daniell said that positive customer acceptance of new products and increased activities in international markets contributed to continued strong sales growth in each of the company’s OSA, respiratory humidification and neonatal product groups.
In NZ dollar terms OSA product group revenue increased by 27%, respiratory humidification revenue increased by 15% and neonatal and warming revenue increased by 25% compared with the prior year. Over the year, the company derived its trading revenue in a variety of currencies with US dollars contributing 62%, Euros 20%, Australian dollars 7%, UK pounds 6%, and NZ dollars 1%. After allowing for exchange rate movements and hedging gains, trading revenue grew 19% in constant currency terms over the prior year.
“We are continuing to gain share within the rapidly growing OSA treatment market with particularly pleasing growth from our broad range of masks and our ThermoSmart CPAP flow generators. Constant currency revenue growth from masks and flow generators combined was an encouraging 28%.
Demand for our humidifier controllers and continuing market share gains by adult and neonatal breathing circuits drove constant currency revenue growth of 18% over the prior year in our respiratory humidification product group,” commented Mr Daniell. Neonatal product group constant currency revenue growth of 24% was generated by both neonatal warmers and neonatal breathing systems, which include the company’s infant CPAP system and infant resuscitator.
Operating profit was NZ$89.6 million compared to NZ$104.1 million for the prior year. Net foreign exchange hedging gains contributed NZ$7.9 million to operating profit compared to NZ$41.3 million last year. Profit after tax for the year was NZ$57.6 million.
The company’s directors have approved a final dividend for the financial year ended 31 March 2007 of NZD 7.0 cents per ordinary share (2006: 7.0 cents), carrying full imputation credit. Non-resident shareholders will receive a supplementary dividend of NZD 1.2353 cents per share. The final dividend will be paid on 29 June 2007, with a record date of 20 June, and an ex-dividend date of 14 June for the ASX and 21 June for the NZSX.
Research & Development, SG&A
Research and development expenses increased by 16% to NZ$20.2 million or 5.8% of trading revenue for the twelve months ended 31 March 2007. The company continued to expand its research and development teams and current new product projects include flow generators, masks and additional breathing system consumables.
Selling, general and administrative (SG&A) expenses grew 19% to NZ$97.6 million as the company continued to expand its operations and its sales teams in North America, Europe and Asia/Pacific.
“Our opportunities to grow market share in the OSA and intensive care ventilation markets continue to be positive and we expect to see a contribution to growth from recently introduced new products for the treatment of patients in a range of additional applications which include non- invasive ventilation, oxygen therapy, humidity therapy and resuscitation.
For the 2008 financial year we expect a continuation of strong underlying revenue growth across our international markets. At current exchange rates (NZD:USD of 0.73) we expect that trading revenue for the year will grow to approximately US$270 million or approximately NZ$370 million, generating an operating profit of approximately NZ$75 million,” said Mr Daniell.
Financial Statements and Commentary
Attached to this news release are condensed financial statements and commentary in both NZ dollars and US dollars.
Full Year Results Conference Call
Fisher & Paykel Healthcare will host a conference call to review the results and to discuss the outlook for the 2008 financial year. The conference call is scheduled to begin today at 10:00am NZST, 8:00am AEST (6:00pm 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 required. An online archive of the event will be available approximately two hours after the webcast and will remain onsite for two weeks.
To participate in the conference call please 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 555 619
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 533024.
About Fisher & Paykel Healthcare
Fisher & Paykel Healthcare is a leading designer, manufacturer and marketer of heated humidification products and systems for use in respiratory care and the treatment of obstructive sleep apnea. It also offers an innovative range of neonatal care products. The company’s products are sold in over 110 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.