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F&P Healthcare profit jumps 51% on sales growth

By Paul McBeth

Thursday 20th November 2008

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Fisher & Paykel Healthcare, the medical products company that gets 60% of revenue in US dollars, boosted first-half profit as it lifted sales and benefited from a weaker New Zealand dollar.

Net profit rose to $28.3 million in the six months ended September 30, from $13.7 million a year earlier. Operating revenue was up 22% to $215.2 million.

“Demand for our respiratory humidifier systems was exceptionally strong in the first half,” said Michael Daniell, managing director of F&P Healthcare, in a statement. “We continue to make encouraging progress in developing opportunities for our technologies.”

The company said it is on track to boost full-year earnings to NZ60 million, almost double last year’s result, on continued “strong” revenue growth and expectation s the New Zealand dollar will average about 55 US cents through the remainder of the year. The New Zealand dollar fell 14.7% in the company’s first half and has declined a further 12 cents since then, to trade recently at 54.28 US cents.

F&P Healthcare has benefited from increased demand for respirators and products that treat the condition sleep apnea, which has been linked to illnesses such as heart disease. It competes with ResMed and Respironics for sales in the US, where demand has continued unabated through the economic downturn.

F&P Healthcare increased its investment on research and development by 14% to $13.3 million as it looks to raise its opportunities to grow.

The company will pay an interim dividend of 5.4 cents per share, fully imputed, unchanged from the previous year.

F&P Healthcare’s stock price rose 0.3% to $3.13 in Wellington trading. In a year where the NZX50 has plummeted almost 35%, F&P Health’s share price has fallen just over 2%.

Sales in North America rose to $99.5 million from $77.6 million, accounting for 46% of the company’s total revenue.

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