Healthcare profit up, shares fall

Fisher & Paykel Healthcare raised its net profit by 22 per cent to $64.1 million for the year to March but a decline in sleep apnoea mask sales helped drive the company's share price sharply lower after its results announcement.

The result compared with a net profit of $52.5 million in the previous year, which included one-off non-cash deferred tax charges of $11.5 million.

F&P Healthcare said expanding clinical applications for its medical devices and new products contributed to record operating revenue of $516.7 million.

In constant currency terms, and excluding the prior year deferred tax charges, the company's net profit after tax grew 23 per cent, mostly as a result of revenue growth, cost control and efficiencies, it said.

F&P Healthcare's share price dropped 16c (6.6 per cent) to $2.27 in the hours after the announcement, the currency-sensitive stock partly reversing a firming trend that had taken place since midway through last month in line with weakness in the New Zealand dollar.

It closed down more than 5 per cent at $2.29 yesterday.

About 52 per cent of the company's revenue is in US dollars and it has extensive currency hedging facilities in place.

In US dollar terms, F&P Healthcare's respiratory and acute care product group operating revenue increased by 18 per cent over the year. The obstructive sleep apnoea product group's revenue increased by 7 per cent over the previous year.

Each group is responsible for about half the company's revenue.

Matt Goodson, portfolio manager at BT Funds Management, said F&P Healthcare's share price had fallen on the back of the decline in mask sales.

"The result itself was just okay, and perhaps a little disappointing relative to some broker forecasts."

The company announced a final dividend of 7c a share, unchanged from the previous year.