Fisher & Paykel Healthcare experienced an unprecedented surge in demand for its breathing aids during the pandemic.
Fisher & Paykel Healthcare may return to profit growth in the first half of its financial year as its business rebalances following a surge in demand for its breathing aids during the Covid-19 pandemic.
In notes released ahead of its annual shareholder meeting on Tuesday, the company said it expects profit of between $95 million to $105m in the six months to September 30. Last year, first-half profit fell 57% to $95.9m. The mid-point of the guidance range suggests profit growth of 4.3%.
Fisher & Paykel Healthcare has reported two years of declining profits as demand for its breathing aids slowed from the unprecedented highs seen during the pandemic when it sold 10 years’ worth of respiratory devices in two years.
Managing director Lewis Gradon said for the first four months of the 2024 financial year, revenue from hospital hardware was marginally lower than assumed, while revenue from masks used to treat obstructive sleep apnea was stronger.
Fisher & Paykel Healthcare expects first-half operating revenue to rise about 14% to $790m, and reiterated its guidance for full-year revenue of $1.7b.
Gradon said group revenue and operating expenses in constant currency terms was consistent with the full-year guidance the company provided in May, with a gross margin improvement approaching 200 basis points expected for the full year.
“This year we have returned to executing on continuous improvement initiatives across the business,” he said.
“During the pandemic we had a responsibility to get as much product as possible into the hands of our customers. Now, we have moved away from that supply-at-all-costs mentality, and we are once again focused on operational efficiency. We expect to see positive financial impacts building through the year.”
The company’s shares fell 2.9% to $21.56 in midday trading on the NZX on Tuesday.