Announcement
HALFYR: FPH: Record half year result for FPH: net profit up 86%
08:58am
FPH
25/11/2020 08:58
HALFYR
PRICE SENSITIVE
REL: 0858 HRS Fisher & Paykel Healthcare Corporation Limited
HALFYR: FPH: Record half year result for FPH: net profit up 86%
News Release
STOCK EXCHANGE LISTINGS: NEW ZEALAND (FPH), AUSTRALIA (FPH)
Record half year result for Fisher & Paykel Healthcare: net profit up 86%
Auckland, New Zealand, 25 November 2020 - Fisher & Paykel Healthcare
Corporation Limited today announced its results for the first half of the
2021 financial year, which ended 30 September 2020.
Net profit after tax was $225.5 million, up 86% over the same period in the
previous financial year, or 87% in constant currency. Operating revenue was
$910.2 million, up 59% or 61% in constant currency.
"I would like to express our thanks and admiration for the healthcare
providers around the world, who have responded with care and courage to the
COVID-19 pandemic. I also want to thank everyone across our entire business,
as well as their partners and families, for their contribution to ensuring
those healthcare providers have the equipment they need to care for their
patients," said Managing Director and CEO Lewis Gradon. "Our thanks and
gratitude also extend to our suppliers around the world. They have gone above
and beyond to answer the global call for our products."
The strong result was driven by the increased demand for the company's
Hospital hardware, in particular its OptiflowTM and AirvoTM systems. This
reflected a shift in clinical practice toward using nasal high flow therapy
as a front-line treatment for COVID-19 patients in hospital.
In the Hospital product group, which includes products used in acute and
chronic respiratory care and surgery, operating revenue grew 93% over the
first half of the previous financial year to
$681.0 million, or 94% growth in constant currency. Hospital products made up
three-quarters of the company's operating revenue.
"Sales in hardware and consumables continued to track surges in COVID-19
globally, as the virus moved across Europe, North America, South America and
South Asia," said Gradon.
In the Homecare product group, which includes products used in the treatment
of obstructive sleep apnea (OSA) and nasal high flow therapy in the home,
operating revenue grew 5% to $226.2 million, or 6% growth in constant
currency.
"Since the pandemic started, many sleep clinics have been closed, resulting
in a reduction in new patient diagnoses. Our F&P EvoraTM and F&P ViteraTM
masks for OSA are great products that have yet to reach their full
potential," said Gradon.
A reduction in gross margin for the six-month period to 61.7% was due to the
increased use of air freight and the elevated costs associated with it.
Excluding these additional freight costs, gross margin was in line with the
first half of the previous financial year in constant currency.
The company's directors have approved an interim dividend of 16 cents per
ordinary share, an increase of 33% on the interim dividend last year. The
interim dividend, carrying full New Zealand imputation credit, will be paid
on 16 December 2020 with a record date of 4 December 2020.
Guide for the remainder of FY2021
"We had a strong first half of the year and have continued to expand our
installed base of hardware in hospitals," said Gradon. "Since our last
trading update in August, we maintained the same level of both hardware and
consumables revenue in our Hospital product group for the half year. In our
Homecare product group, OSA masks revenue also continued at similar levels to
the first four months of the financial year.
We cannot predict the course of COVID-19, the effectiveness or adoption of
preventative measures, the progress of a vaccine and its outcomes, the impact
on future hospitalisation rates, or the investments countries may make in
treatment measures. Consequently, we have no basis on which to provide
guidance for the full 2021 financial year, so we are providing a guide to
full-year results based on the following assumptions:
o Hospital hardware sales return to normal levels from January 2021.
o The use of our hospital hardware returns down to approximately normal rates
for the second half of the financial year.
o OSA diagnosis rates are reduced for the second half of the financial year,
due to limited access to customers.
o Freight costs remain elevated, resulting in a reduction in gross margin of
approximately
200 bps in constant currency for the full financial year compared to the
prior financial year.
Based on these assumptions, and reflecting sustained stronger Hospital
hardware sales to date, full year operating revenue would be approximately
$1.72 billion, and net profit after tax would be approximately $400 million
to $415 million. This guide is based on exchange rates of NZD:USD 0.69 and
NZD:EUR 0.58.
Our assumptions used in providing this guide are not a prediction of the
course of COVID-19 around the world and do not impact our production
planning. We will continue to accelerate our investment in manufacturing
capacity to ensure that a further increase in supply of our products is
available," said Gradon.
"Our heartfelt thanks go out to our customers and to our suppliers,
shareholders and clinical partners who are supporting us during this
extraordinary year," he concluded.
Overview of key results for the first half
o 86% growth in net profit after tax to a record $225.5 million (1H FY20:
$121.2 million).
o 59% growth in operating revenue to $910.2 million, 61% growth in constant
currency.
o 93% growth in Hospital operating revenue to $681.0 million, 94% growth in
constant currency.
o 43% constant currency revenue growth for new applications consumables; i.e.
products used in non-invasive ventilation, Optiflow nasal high flow therapy
and surgical applications, accounting for 63% of Hospital consumables
revenue.
o 5% growth in Homecare operating revenue, 6% growth in constant currency.
o 3% growth in constant currency revenue in OSA masks.
o Investment in R&D was 7% of revenue, or $64.6 million.
o 33% increase in interim dividend to 16 cps (1H FY20: 12 cps).
About Fisher & Paykel Healthcare
Fisher & Paykel Healthcare is a leading designer, manufacturer and marketer
of products and systems for use in acute and chronic respiratory care,
surgery 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 our website www.fphcare.com.
Ends
Media & Investor Contacts:
Karen Knott
Senior Communications Manager
karen.knott@fphcare.co.nz
+64 21 713 911 Hayden Brown
Investor Relations Manager
hayden.brown@fphcare.co.nz
+64 27 807 8073
Authorised by Fisher & Paykel Healthcare Corporation Limited's Board of
Directors.
Accompanying Documents
Attached to this news release are the following additional documents:
o Results in Brief
o Interim Report 2021
o Investor Presentation
o NZX Results Announcement
o NZX Distribution Notice
Constant Currency Information
Constant currency information included within this news release is non-GAAP
financial information, as defined by the NZ Financial Markets Authority, and
has been provided to assist users of financial information to better
understand and track the company's comparative financial performance without
the impacts of spot foreign currency fluctuations and hedging results and has
been prepared on a consistent basis each year. A constant currency analysis
is included on page 15 of the company's Interim Report 2021, and the
company's constant currency framework can be found on the company's website
at www.fphcare.com/ccf.
Half Year Results Conference Call
Fisher & Paykel Healthcare will host a conference call today to review the
results and to discuss the outlook for the remainder of the 2021 financial
year. The conference call is scheduled to begin at 10:00am NZDT, 8:00am AEDT
Wednesday 25 November (4:00pm USEST, Tuesday 24 November) and will be
broadcast simultaneously over the Internet.
To listen to the webcast, access the company's website at
www.fphcare.com/investor. An online archive of the event will be available
approximately two hours after the webcast and will remain on the site for two
weeks.
To attend the conference call, participants should dial in to one of the
numbers below at least five minutes prior to the scheduled call time and
identify yourself to the operator. When prompted, please quote the conference
code of: 950349.
New Zealand +64 9 913 3624
US/Canada +1 646 828 8195
Australia +61 2 9193 3719
Hong Kong +852 3008 1529
United Kingdom +44 330 336 9104
International +64 9 913 3624
End CA:00363846 For:FPH Type:HALFYR Time:2020-11-25 08:58:42
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