The Fisher & Paykel Healthcare Corp Ltd (ASX: FPH) share price is up 7% after the company gave a FY21 trading update.
Fisher & Paykel describes itself as a designer, manufacturer and marketer of products and systems for use in respiratory care, acute care, surgery and the treatment of sleep apnea.
FY21 trading update
Operating revenue for the nine months to 31 December 2020 was up 73% in constant currency terms compared to the prior corresponding period.
In the hospital product group, which includes products used in acute and chronic respiratory care and surgery, operating revenue went up 113% in the first nine months of its FY21. Over the same period, hospital hardware revenue went up 446% and hospital consumables grew by 54%.
In the homecare product group, which includes products used in the treatment obstructive sleep apnea (OSA) and respiratory support in the home, operating revenue grew 6% over the nine months to 31 December 2020 in constant currency.
Management comments
Fisher & Paykel CEO and Managing Director Lewis Gradon said: “In many parts of the world, we have continued to see an influx of COVID-19 patients requiring hospitalisation for respiratory treatment. Healthcare professionals are dealing with pressures unlike anything they have faced before. Our thoughts are with them, the patients under their care, and the families of those who are impacted at this challenging time.
“Given the elevated hospitalisation rates for COVID-19, our hospital hardware sales have continued to be very strong, as has the use of our hospital hardware.”
Outlook
The company said that there is still uncertainty for the rest of FY21 relating to COVID-19 because of the effectiveness and adoption of preventative measures, the progress of vaccines and the outcomes and the impact on future hospitalisation rates.
Fisher & Paykel is expecting revenue and net profit to be higher than previous assumptions used by the business.
Summary thoughts
With hospital hardware sales and usage continuing to track hospitalisation surges in countries around the world, the company may see more growth over the next few months.
However, I don’t know how long this elevated levels of growth will remain. It could be longer than the market is expecting. Or the vaccines could stop it very quickly. We’ll have to see what happens.
It’s a quality business, but it’s not the type of investment bet I like to make. There are other ASX growth shares I’d rather buy that I think can keep growing no matter what happens with COVID-19, such as Pushpay Holdings Ltd (ASX: PPH).
