KEY POINTS:
Fisher & Paykel Healthcare has slashed its profit forecast, blaming the strong New Zealand dollar.
The medical equipment maker, in an update of its earnings guidance, said it expected operating profit for the year ended March 31 to be approximately $57 million.
That is down from the $68 million forecast during its half year result announcement in November, which was based on the Kiwi-US dollar exchange rate averaging 0.75 for the remainder of the financial year.
Last year, the company posted a $89.6 million profit before interest and tax, when the average Kiwi-US dollar exchange rate was 0.63.
The company, which expects to report its full-year results on May 21, forecast operating revenue growth of about 8 per cent in US dollar terms to approximately US$270 million, or 2 per cent in New Zealand dollar terms to $355 million. This was driven by strong growth from consumable products, which include masks and breathing circuits.
"We enjoyed robust operating revenue growth in the second half, in US dollar terms, particularly for our respiratory and acute care product group," said CEO Michael Daniell.
Demand for respiratory humidifier systems for major hospital Group Purchasing Organisation contracts in the US exceeded the company's capacity in the fourth quarter, he said.
"We finished the year with substantial orders in hand, so we expect a strong start to the new financial year and continuing increase in demand for our products."
The company's products are sold in more than 110 countries. US sales contributed 60 per cent of its revenue.
Shares in Fisher & Paykel Healthcare fell 12c yesterday to $2.93.
