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Fisher & Paykel Healthcare (ASX:FPH) share price jumps on strong HY24 result

The Fisher & Paykel Healthcare Corporation Ltd (ASX: FPH) share price has jumped 7% after the company reported its FY24 first half result.

The company describes itself as 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.

FY24 first half

Here are some of the highlights from the six months of its 2024 financial year, compared to the same period in FY23:

  • Operating revenue rose 16% to NZ$803.7 million
  • The gross profit margin improved to 60.5%, up 65 basis points (0.65%)
  • Homecare operating revenue jumped 26% to NZ$314.4 million
  • Hospital operating revenue rose 11% to NZ$487.5 million
  • Net profit after tax (NPAT) grew 12% to NZ$107.3 million
  • Interim dividend increased 3% to NZ$0.18 per share

The company revealed that there was a 19% increase for new applications consumables – meaning products used in non-invasive ventilation, Optiflow nasal high flow and surgical applications – accounting for 70% of hospital consumables revenue.

Fisher & Paykel also reported a 28% increase of revenue in constant currency terms for OSA masks and accessories revenue.

Management said this result indicated a continuation of stable ordering patterns in its hospital business and a robust performance for homecare.

The company noted its Evora Full has been available in the US for more than a year and it continues to see impressive demand and positive customer feedback. It’s expecting to build on this momentum next year as its “revolutionary new F&P Solo mask is rolled out beyond New Zealand and Australia.”

Cost headwinds such as freight rates and manufacturing inefficiencies “continue to ease”.

Outlook for the Fisher & Paykel share price

At the current exchange rate, it’s expecting FY24 operating revenue to be approximately NZ$1.7 billion and net profit after tax to be in the range of approximately NZ$250 million to NZ$260 million.

The Managing Director and CEO Lewis Gradon said:

Historically, sales of our hospital consumables are typically higher in the second half, reflecting seasonal patterns of hospitals.

We are currently expecting that our revenue guidance approximation incorporates the range of pre-COVID historical seasonality in hospital consumables.

It’s a good business, seemingly one of the best in the world at what it does. It’s hard to say what a good price is for the long-term, so it’s not one I’m looking to invest in. But, the numbers it’s posting are impressive.

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At the time of publishing, Jaz does not have a financial or commercial interest in any of the companies mentioned.
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