25 May 2012

Fisher and Paykel Healthcare full year profit jumps 22%

8:12 pm on 25 May 2012

Fisher & Paykel Healthcare's full year profit has jumped 22%, thanks to cost cutting and strong demand for its products.

The specialist medical equipment maker made an after-tax profit of just over $64 million for the year ending March.

But once non-cash tax charges are taken into account, the company's end of year earnings were flat, rising just 0.3%.

Managing director Mike Daniell says the roll out of new products during the year contributed to a record operating revenue of $516 million.

He says more than half of Fisher & Paykel Healthcare's revenues come from the United States, and its currency hedging policy has served it well in the face of a strong New Zealand dollar, contributing nearly $50 million to its operating profit.

Fisher & Paykel Healthcare will pay a final dividend of 7 cents a share.

Similar this year

The company says it expects to make a profit of between $62 million and $70 million this financial year, particularly in the second half as it introduces its new products around the world.

"We expect constant currency revenue growth to begin to ramp up, as the broad range of new products we're introducing gains traction towards the middle of the financial year," says Mr Daniell.

"Constant currency earnings should follow a similar trend, but at a higher rate, as we continue to generate operating leverage from Mexico, product mix and other efficiencies."

Shares drop

However, shares fell almost 6% on Friday, with investors disappointed by the growth forecasts for the current financial year.

They closed down 14 cents to $2.29.