Fisher & Paykel Healthcare Reports Strong Earnings Growth

Fisher & Paykel Healthcare Corporation Limited ((FSPKF)) has held its Q4 earnings call. Read on for the main highlights of the call.

Fisher & Paykel Healthcare’s recent earnings call painted a picture of robust financial health, marked by significant revenue and profit growth. Despite facing challenges such as global tariffs and a slowdown in OSA mask revenue growth, the overall sentiment was positive, with achievements in various segments suggesting a strong performance outlook.

Record Operating Revenue

The company reported a record operating revenue of $2.02 billion for the full year, marking a 16% increase from FY2024 and a 14% rise in constant currency. This milestone underscores the company’s ability to drive growth across its operations.

Significant Profit Increase

Fisher & Paykel Healthcare saw a substantial increase in net profit after tax, reaching $377.2 million. This represents a 43% rise from FY2024, or 30% in constant currency, highlighting the company’s effective cost management and revenue generation strategies.

Hospital Operating Revenue Growth

Hospital operating revenue experienced an 18% growth, totaling $1.28 billion for the year. This growth, 16% in constant currency, reflects the company’s strong presence and demand in the hospital segment.

Homecare Operating Revenue Growth

The homecare segment also showed impressive growth, with operating revenue reaching $739.9 million, up 13% from FY2024 or 11% in constant currency. This indicates a growing market for homecare solutions.

Gross Margin Improvement

The company’s gross margin improved to 62.9%, an increase of 181 basis points, or 129 basis points in constant currency. This improvement is a testament to the company’s operational efficiencies and pricing strategies.

Strong Operating Cash Flow

Operating cash flow was robust at $549 million, up 28% from the previous year, providing the company with a strong financial foundation to support future growth initiatives.

Dividend Increase

Shareholders will benefit from a fully imputed final dividend of $0.24 per share, a 2% increase from last year, reflecting the company’s commitment to returning value to its investors.

Impact of Global Tariffs

The ongoing global tariffs pose a challenge, with an expected impact of approximately 75 basis points on the gross margin annually. This highlights the external pressures the company faces in maintaining its profitability.

Slowed OSA Mask Revenue Growth

The growth in OSA mask revenue slowed to 9% in constant currency in the second half, down from 14% in the first half. This slowdown indicates potential market saturation or increased competition in this segment.

CapEx Decrease

Capital expenditure decreased to $103 million, down from $339 million last year, which included a significant land acquisition. This reduction suggests a more strategic approach to capital allocation.

Forward-Looking Guidance

For fiscal year 2026, Fisher & Paykel Healthcare anticipates operating revenue between $2.15 billion and $2.25 billion, with net profit after tax projected to range from $390 million to $440 million. Despite the impact of global tariffs, the company expects a gross margin improvement of about 50 basis points, driven by efficiency gains and pricing strategies. The company plans to expand its product reach and improve clinical practices, leveraging existing resources to sustain growth.

In summary, Fisher & Paykel Healthcare’s earnings call conveyed a strong financial performance with substantial revenue and profit growth. While challenges such as global tariffs and slowed OSA mask revenue growth persist, the company’s strategic initiatives and positive outlook suggest continued success in the upcoming fiscal year.