KEY POINTS:
The strong New Zealand dollar is set to take a chunk out of Fisher & Paykel Healthcare's first- half profit, which is due this week, while strong half-year earnings are in the pipeline for Rakon, Ryman Healthcare and Mainfreight.
F&P Healthcare, the sister company of Fisher & Paykel Appliances, said in August that it expected to report an operating profit of about $32 million for the six months to September, down from $46.1m a year earlier.
The company, which makes and markets heated humidification devices used in respiratory care and to treat of obstructive sleep apnoea, reports its first-half result on Thursday.
The first four months of the financial year started positively enough for F&P Healthcare, but the ongoing strength of the New Zealand dollar has been an earnings headache, analysts say.
Guy Hallwright, an analyst at Forsyth Barr, says he expects the company's result to be closely in line with the guidance given at the annual meeting.
"Last year in the first half, the New Zealand dollar was at US$0.63 and they have since had a 17 per cent adverse movement in the rate, which basically affects most, but not all, of their revenues," he says.
F&P Healthcare's share price has been trading at the lower end of its 52-week trading range of $3.16 to $4.50, mostly as a result of currency pressure.
Goldman Sachs JB Were strategist Bernard Doyle agrees the currency will be the key, but that the focus will be on the company's underlying growth.
"Everyone knows the currency is a headwind for them and that's going to weigh on first-half profits, but what is going to drive stock is underlying market growth, particularly in OSA in the United States," says Doyle.
A sell-off in the New Zealand dollar in August and September raised hopes that some of the currency pressure was coming off. Those hopes have since been dashed with a bounce-back in the currency to US$0.76.
Listed retirement village operator Ryman Healthcare has been growing strongly since 2002 and is expected to report a big improvement on its last first-half profit of $19.6m when it reports on Friday.
Transport group Mainfreight, which is chasing double-digit profit growth, reports its first-half result on Wednesday.
Mainfreight reported a record $36.4m for the year to March 31.
In the three months to June, the net surplus was $5.8m compared with $5.5m in the same quarter last year.
Rakon, which reports its result tomorrow, is expected to put in a strong showing over the first half.
The company, which specialises in high-performance frequency-control technology, said in September that it was on track for a good result over the first six months.
This followed a strong finish to its 2006 financial year, which saw it post a net profit after tax of $4.8m, up 65 per cent on the previous year.
There was strong demand for Rakon products, coupled with a favourable US dollar exchange rate that was cemented in with hedging strategies.
