Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


F&P Healthcare shares at highest in over 2 yrs on outlook

F&P Healthcare shares jump to highest in more than 2 years on profit outlook

By Tina Morrison

May 23 (BusinessDesk) - Shares in Fisher & Paykel Healthcare jumped to their highest in more than two years as the maker of breathing masks and respirators said it expects to beat analyst estimates for 2014 profit after surpassing its own guidance for 2013.

F&P Healthcare shares surged 5.9 percent to $3.21, the highest since Feb. 1, 2011, when it touched $3.22. The stock has surged 23 percent so far this year.

Profit is likely to be $85 million to $90 million in the year ending March 13, 2014, managing director Michael Daniell said today. That's more than the $79 million-to-$83 million range expected in a survey of seven analysts by Merlin Consulting.

F&P Healthcare, which competes with Resmed and Respironics, is boosting profit margins on record sales, higher-margin new products and lower costs from its plant in Mexico.

"The share price rise reflects the guidance for 2014 being better than expectations," said Rickey Ward, who manages equities at Tyndall Investment Management. "Next year looks like it's better than forecast."

F&P Healthcare said 2013 profit rose 20 per cent to $77.1 million, ahead of its February guidance of about $75 million. The company boosted operating revenue to a record $556.3 million on strong demand for its respiratory systems and new masks to treat the condition obstructive sleep apnea.

"All of the new products we have invested in over the last 18 months do a better job and in return for that we are getting better margins," Daniell said on a conference call. "We are pretty positive about the coming year."

The company expects operating revenue to rise to between $610 million to $630 million in 2014, Daniell said. The 2014 forecasts are based on the New Zealand dollar trading between 80 US cents and 85 US cents for the remainder of the year as about half its operating revenue is derived in US dollars.

In constant currency terms, which the company uses to show its underlying performance excluding currency affects, operating revenue rose 11 percent. Sales of respiratory products rose 15 percent, while sales of devices to treat obstructive sleep apnea increased 6 per cent.

The annual revenue growth rate in constant currency terms should continue in the mid-teens, driven by new products and applications, Daniell said.

Making an increased quantity and range of products at its plant in Mexico contributed to an improvement in gross margin to 55.3 percent in 2013 from 53.2 percent the year earlier, Daniell said.

Removing the effects of currency volatility, gross margins are expected to expand 100 to 200 basis points a year as a result of new products, efficiencies and the Mexico plant, he said.

F&P Healthcare expects to outlay $40 million in capital expenditure in 2014. That's down from $62 million in 2013 when it spent on new equipment to increase manufacturing capacity, new product tooling, replacement equipment and $33.6 million to complete a third building on its Auckland site.

Research and development spending increased 9 percent in 2013 and current new projects include masks, flow generators, humidifier systems and respiratory and acute care consumables.

It spent 6 percent more on selling as it expanded in North America, Europe and the Asia Pacific regions.

The company's diluted earnings per share increased to 13.8 cents in 2013 from 11.7 cents the year earlier. It will pay a final dividend of 7 cents a share on July 5, unchanged from the year earlier.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Houses (& Tobacco) Lead Inflation: CPI Up 0.3% In March Quarter

The consumers price index (CPI) rose 0.3 percent in the March 2014 quarter, Statistics New Zealand said today. Higher tobacco and housing prices were partly countered by seasonally cheaper international air fares, vegetables, and package holidays. More>>

ALSO:

Notoriously Reliable Predictions: Budget To Show Rise In Full-Time Income To 2018: English

This year’s Budget will forecast wage increases through to 2018 amounting to a $10,500 a year increase in average full time earnings over six years to $62,200 a year, says Finance Minister Bill English in a speech urging voters not to “put all of this at risk” by changing the government. More>>

ALSO:

Prices Up, Volume Down: March NZ House Sales Drop 10% As Loan Curbs Bite

New Zealand house sales dropped 10 percent in March from a year earlier as the Reserve Bank’s restrictions on low-equity mortgages continue to weigh on sales of cheaper property. More>>

ALSO:

Scoop Business: Chorus To Appeal Copper Pricing Judgment

Chorus will appeal a High Court ruling upholding the Commerce Commission’s determination setting the regulated prices on the telecommunications network operator’s copper lines. More>>

ALSO:

Earlier:

Cars: Precautionary Recalls Announced For Toyota Vehicles

Toyota advises that a number of its New Zealand vehicles are affected by a series of precautionary global recalls. Toyota New Zealand General Manager Customer Services Spencer Morris stressed that the recalls are precautionary. More>>

ALSO:

'Gardening Club': Air Freight Cartel Nets Almost $12 Million In Penalties

The High Court in Auckland has today ordered Swiss company Kuehne + Nagel International AG to pay a penalty of $3.1 million plus costs for breaches of the Commerce Act. Kuehne + Nagel’s penalty brings the total penalties ordered in this case to $11.95 million ... More>>

ALSO:

Crown Accounts: Revenue Below Projections

Core Crown tax revenue has increased by $1.9 billion (or 5.0%) compared to the same time last year. However this was $1.1 billion less than expected and is reflected across most tax types, continuing the pattern of recent months. More>>

ALSO:

Efficiency: Businesses And Households To Save From New Energy Plans

Minister of Energy and Resources Simon Bridges today announced three energy efficiency initiatives to improve business productivity, save money and reduce carbon emissions. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news