Fisher & Paykel Healthcare Corporation Limited Analysis

Overview

Fisher & Paykel Healthcare is a global leader in medical devices and systems for use in respiratory care and acute care, and in the treatment of obstructive sleep apnea. The company has a consistent growth strategy to provide an expanding range of innovative medical devices which can help to improve care and outcomes for patients in an increasing range of applications.

Its products are sold to hospitals and healthcare facilities around the world through direct sales offices operations and a network of distributors that sell to hospitals, homecare providers and other manufacturers of medical devices.

Formerly Fisher & Paykel Industries, Fisher & Paykel Healthcare arose from the separation of the major trading businesses of Fisher & Paykel Industries into Appliances and Healthcare in November 2001. The company's securities are listed in both New Zealand and Australia.

Performance

The following information was extracted from Fisher & Paykel Healthcare Corporation Limited's half year results, released 28 November 2024:

Record first-half revenue for Fisher & Paykel Healthcare; net profit up 43%

Total operating revenue was a record $951.2 million, an increase of 18% from the prior corresponding period or 17% in constant currency. Net profit after tax for the first half was $153.2 million, up 43% over the same period in the previous financial year, or 51% in constant currency.

“Growth has been broad-based across our entire portfolio of hospital products, including in invasive and noninvasive ventilation and Optiflow for respiratory and anesthesia patients, all suggesting that we are making headway with changing clinical practice.

“We are also pleased with the continued strong performance of our range of masks for patients with obstructive sleep apnea. With the introduction of the F&P Nova Micro mask, alongside our recently launched F&P Solo AutoFit mask and F&P Evora Full, we address a diverse array of patient needs and preferences with our latest technology,” said Mr Gradon.

Gross margin was 61.9% for the first half of the 2025 financial year, which was a 141 basis-point increase in reported currency over the prior comparable period, or a 198 basis-point increase in constant currency.

The company’s directors have approved an interim dividend of 18.5 cents per ordinary share, up from 18 cents per share in the first half of the prior year. The interim dividend, carrying full New Zealand imputation credit, will be paid on 18 December 2024 with a record date of 6 December 2024.

Given the company’s strong financial performance and reduction of debt, the Board has determined to suspend the dividend reinvestment plan (DRP). As a result, shareholders who have previously elected to participate in the DRP will receive their dividends for this period in cash.

Overview of key results for the first half of the 2025 financial year

• 18% increase in operating revenue to $951.2 million, 17% increase in constant currency.
• 43% increase in net profit after tax to $153.2 million, 51% increase in constant currency.
• 21% increase in Hospital operating revenue to $591.4 million, 21% increase in constant currency.
• 24% increase in constant currency for new applications consumables (products used in noninvasive ventilation, Optiflow nasal high flow and surgical applications) accounting for 73% of Hospital consumables revenue.
• 14% increase in Homecare operating revenue to $359.4 million, 13% increase in constant currency.
• 14% increase in constant currency for OSA masks and accessories revenue.
• Investment in R&D was 12% of revenue, or $110.1 million.
• 3% increase in interim dividend to 18.5 cps (H1 FY24: 18 cps).