Fisher & Paykel (NZE:FPH) praised robust growth in its home care product group, as the Auckland, New Zealand-based manufacturer reported its full-year earnings for the period that ended March 31.
In its May 26 earnings call, Fisher & Paykel said its total operating revenue was $2.31 billion in New Zealand dollars (about $1.36 billion U.S.), “an increase of 14% from the prior financial year, or 12% in constant currency.”
CEO and Managing Director Lewis Gradon said home care operating revenue was $802.7 million: “That’s up 8% on last year or 7% constant currency.”
Growth in the mask sector to treat obstructive sleep apnea (OSA) was up 7%, Gradon added, “with that growth generated by our latest Solo and Nova ranges of nasal and pillows masks.”
Operating revenue for the company’s hospital business was $1.5 billion New Zealand, an increase of 18% from the prior period. That increase was led by Fisher & Paykel’s launch of the Airvo 3 Optiflow high-flow therapy device and the 950 humidification system into the United States in the first half of the company’s 2025 fiscal year.
The impact of global events
Gradon acknowledged operating in “interesting times,” saying, “In general, we assume a continuation of the current status. Just for absolute clarity, these are assumptions that we’ve incorporated in our estimates. They’re not necessarily a prediction of the future or future events. First of all, tariffs. There’s a number of moving parts to potential U.S. tariffs during the year. We fully expect some change at some time during the year.
“In this net profit after tax estimate, we’ve assumed that a 10% tariff rate for certain respiratory products manufactured in New Zealand is applied for the whole year. This results in an estimated adverse impact to gross margin of 70 basis points in constant currency terms, and that is actually an improvement of 20 basis points over last year.”
Regarding events in the Middle East, Gradon said, “We have a very seasoned and experienced team of supply chain professionals, and we’ve got longstanding supportive working relationships with our suppliers, and they have all been working long and hard from the very beginning to mitigate the impact of this conflict on our supply of medical devices.
“Based on our current status, our best estimate for the impact on raw materials is an additional 45 basis point cost to gross margin and for freight, an additional impact of 25 basis points to gross margin. We’re also assuming that sea freight availability is not impacted to the extent that it pushes us to more air freight than normal. In addition, for our business, we’re not expecting any impact to revenue in the region from the conflict for the year.”
Fisher & Paykel’s momentum
Despite operating in challenging times, Gradon pointed to Fisher & Paykel’s current momentum.
“We do believe that a business built on innovation, with the patience to change clinical practice, the discipline of a robust quality management system, and a mindset of continuous improvement builds momentum,” he said. “In the face of these disruptions and uncertainties, this momentum helps keep us on track towards the compelling market opportunities we have in front of us.”
