Ann: FLLYR: FPH: FPH Reports Record Full Year Net

• Release Date: 23/05/13 11:05
• Summary: FLLYR: FPH: FPH Reports Record Full Year Net Profit Up 20%
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FPH
23/05/2013 09:05
FLLYR

REL: 0905 HRS Fisher & Paykel Healthcare Corporation Limited

FLLYR: FPH: FPH Reports Record Full Year Net Profit Up 20%

FISHER & PAYKEL HEALTHCARE REPORTS RECORD FULL YEAR NET PROFIT, UP 20%
Auckland, New Zealand, 23 May 2013 - Fisher & Paykel Healthcare Corporation
Limited (NZSX:FPH, ASX:FPH) today reported record net profit after tax of
NZ$77.1 million for the year ended 31 March  2013, an increase of 20%
compared to the prior year.  Full year operating revenue was a record
NZ$556.3 million, 8% above the prior year or 11% growth in constant currency.

For the second half, net profit after tax grew by 22% to NZ$43.8 million and
operating revenue grew 9% to NZ$289.3 million. In constant currency,  second
half operating revenue increased by 14% and net profit after tax increased by
54%, primarily as a result of revenue growth, improved gross margins and
operating efficiencies.

Respiratory and acute care product group (RAC) operating revenue grew 18% and
Obstructive Sleep Apnea product group (OSA) operating revenue grew 10% in
constant currency, compared to the prior year second half.

"Robust growth in our RAC product group was driven by strong demand for our
respiratory systems, which help to improve effectiveness and efficiency of
care in a wide range of applications, including invasive ventilation,
non-invasive ventilation, oxygen therapy and humidity therapy", commented
Fisher & Paykel Healthcare's CEO, Mr Michael Daniell.  "Growth in revenue
from new applications beyond invasive ventilation was very strong, with
consumables revenue from those increasing 38%, in constant currency, for the
second half.

"Enthusiastic customer acceptance of our easy to fit, comfortable and
effective Pilairo nasal pillows and Eson nasal masks drove OSA mask revenue
growth of 16% in the second half, in constant currency.  Early indications
are that our recently introduced Simplus full-face mask will also be very
well accepted.

"Our new ICON+ flow generator range is rolling out to our major markets at
present, and combines very simple setup with our comfort enhancing SensAwake
and ThermoSmart systems and our efficient cloud-based Info Technologies for
compliance data recording and reporting".

Dividend
The company's directors have approved a final dividend for the financial year
ended 31 March 2013 of 7.0 NZ cents per ordinary share (2012: 7.0 cents),
carrying full imputation credit.  For New Zealand resident shareholders that
results in a gross dividend of 9.722 cents per ordinary share. Eligible
non-resident shareholders will receive a supplementary dividend of 1.235 NZ
cents per ordinary share.  The final dividend will be paid on 5 July 2013,
with a record date of 21 June 2013, and ex-dividend dates of 17 June 2013 for
the ASX and 19 June 2013 for the NZSX.

The company offers a dividend reinvestment plan (DRP), under which eligible
shareholders may elect to reinvest all or part of their cash dividends in
additional shares.  A 3% discount will be applied when determining the price
per share of shares issued under the DRP and will be applied in respect of
the 2013 final dividend and future dividends, until such time as the
directors determine otherwise.

Research & Development, Selling, General & Administrative expenses
Research and development (R&D) expenses increased by 9% over the prior year
to NZ$45.7 million, representing 8.2% of operating revenue.

The company continued to expand its product and process research and
development activities, and current new product projects include masks, flow
generators, humidifier systems and respiratory and acute care consumables.

Selling, general and administrative (SG&A) expenses increased 6% to NZ$151.8
million, or 9% in constant currency, as the company continued to expand its
operations and its sales teams in the North America, Europe and Asia-Pacific
regions.

Capacity Expansion
During the year the company invested NZ$62.0 million of capital expenditure,
which included equipment for increased manufacturing capacity, new product
tooling, replacement equipment and NZ$33.6 million for completion of the
third building on its Auckland site.  The company expects capital expenditure
to be approximately NZ$40 million for the 2014 financial year.

The ramp-up of manufacturing of consumable products at the company's facility
in Tijuana, Mexico progressed as expected with an increasing quantity and
range of the company's products now manufactured there. Increased volume from
the Mexico facility contributed to the increase in gross margin.

Foreign Exchange Hedging
To protect the company from exchange rate volatility, the company had in
place at 31 March 2013 a mix of foreign exchange contracts and collar
options, up to five years forward, with a face value of approximately NZ$385
million.  These instruments hedge the company's net exposure.  At the
commencement of the 2014 financial year, the company had in place
approximately 60% cover for the US dollar and approximately 77% cover for the
Euro at average rates of approximately 0.76 US dollars and 0.47 Euros to the
New Zealand dollar.

The company closed out foreign exchange contracts in the 2010 and 2012
financial years, which will contribute NZ$21.3 million in the 2014 financial
year to operating profit but not to cash flow, as the cash was received in
the 2010 and 2012 financial years.  Those instruments were progressively
replaced with new instruments that form part of the company's current foreign
exchange hedging.

Outlook for FY2014
"We expect our underlying revenue growth to continue to be robust this year,
driven by a broad range of new products and applications.

"Constant currency operating margin is expected to increase, as a result of
growth in higher margin differentiated products, cost reductions and other
efficiencies.

"For the 2014 financial year, based on an exchange rate range of 0.80 to 0.85
for the NZD:USD for the remainder of the year, we expect our operating
revenue to be in the range of NZ$610 million to NZ$630 million and net profit
after tax to be in the range of NZ$85 million to NZ$90 million", concluded Mr
Daniell.

Financial Statements and Commentary
Attached to this news release are condensed NZ dollar financial statements
and commentary. For convenience the income statement has been translated into
US dollars.  The US dollar financial statement is non-conforming financial
information, as defined by the NZ Financial Markets Authority.

The company's financial statements for the year ended 31 March 2013 and the
comparative financial information for the year ended 31 March 2012 have been
prepared under the New Zealand equivalents to International Financial
Reporting Standards (NZ IFRS).

A constant currency analysis is also included. A constant currency income
statement is prepared each month to enable the board and management to
monitor and assess the company's underlying financial performance without any
distortion from changes in foreign exchange rates.  The constant currency
data provided is an estimate of the changes in the main income statement
items after excluding the impact of movements in foreign exchange rates,
hedging results and balance sheet translations.  The data is based on the NZ
dollar income statements for the relevant periods which have all been
restated at the budget foreign exchange rates for the 2013 financial year.

The constant currency analysis is non-conforming financial information, as
defined by the NZ Financial Markets Authority, and has been provided to
assist users of financial information to better understand and track the
company's financial performance without the impacts of spot foreign currency
fluctuations and hedging results.

Full Year Results Conference Call
Fisher & Paykel Healthcare will host a conference call today to review the
results and to discuss the outlook for the 2014 financial year.  The
conference call is scheduled to begin at 10:00am NZST, 8:00am AEST (6:00pm
USEDT) and will be broadcast simultaneously over the Internet.

To listen to the webcast, access the company's website at
www.fphcare.com/investor.  Please allow extra time prior to the webcast to
visit the site and download the streaming media software if required.  An
online archive of the event will be available approximately two hours after
the webcast and will remain on the site for two weeks.

To attend the conference call, participants will need to dial in to one of
the numbers below at least 5 minutes prior to the scheduled call time and
identify yourself to the operator.  When prompted, please quote the
conference code of:  69177616.

New Zealand Toll Free 0800 452 569 USA Toll Free 1866 242 1388
Australia Toll Free 1800 354 715 Hong Kong Toll Free 800 968 831
United Kingdom Toll Free 0808 234 7860 International +61 2 8823 6760

An audio replay of the conference call will be available approximately 2
hours after the call and will be accessible for two weeks by dialing one of
the numbers below.  When prompted please enter the conference code of:
69177616.

New Zealand Toll Free 0800 453 213 USA Toll Free 1855 452 5696
Australia Toll Free 1800 153 898 Hong Kong Toll Free 800 963 117
United Kingdom Toll Free 0808 234 0072 International +61 2 8199 0299

About Fisher & Paykel Healthcare
Fisher & Paykel Healthcare is a leading designer, manufacturer and marketer
of products and systems for use in respiratory care, acute care and the
treatment of obstructive sleep apnea. The company's products are sold in over
120 countries worldwide.  For more information about the company, visit our
website www.fphcare.com.

Contact: Michael Daniell MD/CEO on +64 9 574 0161 or Tony Barclay CFO on +64
9 574 0119.
End CA:00236541 For:FPH    Type:FLLYR      Time:2013-05-23 09:05:41