Fisher & Paykel profits down, but rebounding

AUCKLAND: Fisher & Paykel Healthcare said its net profit for the March year came to $250.3 million, down 34% on the previous year, as the respiratory products maker emerged from three years of very high demand arising from the Covid pandemic.

Total operating revenue for the year was $1.58 billion, down 6%, or 9% in constant currency terms, from 2022.

The net profit and revenue figures were in line with market expectations.

For the second half, operating revenue grew 14% to $890.5 million from the second half of 2022, driven by strong growth in hospital new application consumables and obstructive sleep apnoea mask revenue.

Managing director and CEO Lewis Gradon said the company was coming out of three financial years which had been heavily impacted by Covid.

“The secondhalf result was encouraging as market conditions progressed towards more of a normal state, and both our hospital and homecare product groups delivered good growth,” Mr Gradon said.

Hospital product group revenue for the full year was $1.02 billion, a 15% decrease compared to the previous year.

Hospital hardware sales were down 53% in constant currency terms compared to the 2022 financial year, a year more influenced by global Covid surges, the company said.

It expected operating revenue of about $1.7 billion for the 2024 year, with similar revenue growth rates for both Hospital and Homecare product groups.

It also expected big margin improvements in the years ahead, it said.

During the last three years, Fisher & Paykel Healthcare said its responsibility was: “To get as much product as possible into the hands of our customers”.

“Now, as every team in our business turns back to efficiency gains, we are confident in our ability to return to our longterm target of 65% within three to four years.”

For 2024, the company anticipated a gross margin improvement of about 200 basis points in constant currency terms, Mr

Gradon said.

Gross margin for 2023 was 59.4%, a 369 basis point decrease in constant currency terms, partly because of higher freight costs.

In 2023, hardware sales in countries or regions that did not experience Covid surges tracked “somewhat close” to prepandemic patterns.

Hospital new applications consumables revenue for the full year was down 6% from the prior year as hospital customers worked through their excess inventory.

This trend abated throughout the year, and new applications consumables revenue for the second half of 2023 was up 13% over the second half of 2022.

Homecare product group revenue for the full year was a record $553.8 million, 18% higher than the previous year.

Fisher & Paykel Healthcare set a final dividend of 23.0 cents per share for the second half of the year, bringing the total to 40.5 cents per share, an increase of 3% over 2022.

The company announced the acquisition of 105ha of land in Karaka, Auckland for a second New Zealand campus during the year. —