Ann: HALFYR: FPH: FPH Reports Record Half Year Ne

• Release Date: 22/11/13 10:58
• Summary: HALFYR: FPH: FPH Reports Record Half Year Net Profit Up 34%
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					FPH
22/11/2013 08:58
HALFYR

REL: 0858 HRS Fisher & Paykel Healthcare Corporation Limited

HALFYR: FPH: FPH Reports Record Half Year Net Profit Up 34%

FISHER & PAYKEL HEALTHCARE REPORTS RECORD HALF YEAR NET PROFIT, UP 34%
Auckland, New Zealand, 22 November 2013 - Fisher & Paykel Healthcare
Corporation Limited (NZSX:FPH, ASX:FPH) today reported record net profit
after tax of NZ$44.5 million for the six months ended 30 September 2013, an
increase of 34% compared to the first half last year.

Operating revenue for the half year was a record NZ$303.9 million, 14% above
the prior comparable period as a result of strong revenue growth in the
company's two major product groups.  Respiratory and acute care (RAC) product
group operating revenue grew 15% to NZ$164.1 million and Obstructive Sleep
Apnea (OSA) product group operating revenue grew 15% to NZ$131.2 million.

An interim dividend of 5.4 NZ cents per ordinary share, carrying full New
Zealand imputation credit, will be paid on 19 December 2013.

"We are pleased with the record results achieved for the half year, with both
of our major product groups delivering strong growth", commented Fisher &
Paykel Healthcare's CEO, Mr Michael Daniell.

"This is a reflection of our strategy to increase the range of applications
for our technologies and to extend the range of products we provide for use
in the care of each patient.  An increasing number of clinicians and homecare
providers are now choosing our devices to help improve patient outcomes and
efficiency of care.

"Robust growth in our RAC product group was driven by particularly strong
demand for our respiratory systems which help to improve care and outcomes in
non-invasive ventilation, oxygen therapy, humidity therapy and surgery.
Growth in consumables revenue from those applications increased 29% in
constant currency.

"The roll-out of our Eson nasal, Pilairo nasal pillows and Simplus full face
masks was a key contributor to OSA mask constant currency revenue growth of
19%, compared to the first half last year. This month, we have introduced the
Simplus and new Pilairo Q masks into the United States, with positive early
acceptance by homecare providers and users.

"ICON+, our new flow generator range, was introduced into our major markets
during the half and contributed to an encouraging 12% constant currency
growth in total flow generator revenue in the second quarter".

Outlook for FY2014
"Our strategic direction remains consistent as we focus on developing
innovative products, increasing the number of patients who can benefit from
our products, extending our range of products and growing our international
presence.

"We expect our underlying revenue growth to be robust for the remainder of
the year, driven by growing demand for a broad range of new products and new
applications for our products.

"We continue to expect net profit after tax to be in the range of NZ$90
million to NZ$95 million for the 2014 financial year, based on an exchange
rate of 0.83 for the NZD:USD for the remainder of the year, despite exchange
rates moving unfavourably since our last earnings guidance update in August.
We expect operating revenue to be in the range of NZ$610 million to NZ$625
million", concluded Mr Daniell.

Dividend
The company's directors have approved an interim dividend for the financial
year ending 31 March 2014 of 5.4 NZ cents per ordinary share (2013: 5.4
cents), carrying full New Zealand imputation credit. For New Zealand resident
shareholders that results in a gross dividend of 7.5 cents per ordinary
share. Eligible non-resident shareholders will receive a supplementary
dividend of 0.953 NZ cents per ordinary share. The interim dividend will be
paid on 19 December 2013, with a record date of 6 December 2013, and
ex-dividend dates of 2 December 2013 for the ASX and 4 December 2013 for the
NZSX.

Dividend Reinvestment Plan
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 2014 interim dividend and future dividends, until such time as the
directors determine otherwise.

Research and Development expenses
The company continued to expand its product and process research and
development (R&D) activities, and current new product projects include masks,
flow generators, humidifier systems and respiratory and acute care
consumables.

R&D expenses increased by 21% over the prior comparable period to NZ$25.8
million, representing 8.5% of operating revenue.  R&D expenses included
depreciation and operating costs of NZ$0.9 million relating to the new
building on the Auckland site, which will primarily accommodate future growth
in R&D activities.

Selling, General and Administrative expenses
Selling, general and administrative (SG&A) expenses increased 12% to NZ$86.0
million, or 13% in constant currency, as the company continued to expand its
international operations and sales teams.

Capacity Expansion
During the first half, the company invested NZ$18.4 million of capital
expenditure, which included equipment for increased manufacturing capacity
and new product tooling. In the first half last year, capital expenditure of
NZ$40.9 million included NZ$27.4 million for construction of the third
building on its Auckland site, which was completed in November 2012.

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, coupled with lean manufacturing
improvements at the company's Auckland facility and a positive product mix,
contributed to a constant currency 357 bps increase in gross margin compared
to the first half last year.

Foreign Exchange Hedging
To protect against exchange rate volatility, the company had in place at 30
September 2013 a mix of foreign exchange contracts and collar options, up to
four years forward, with a face value of approximately NZ$430 million. These
instruments hedge the company's net exposure.  At the commencement of the
second half, the company had in place for the year ended 31 March 2014
approximately 94% cover for the US dollar and approximately 91% cover for the
Euro at average rates of approximately 0.77 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.
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 six months ended 30 September 2013
and the comparative financial information for the six months ended 30
September 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 excludes 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 2014 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.

Half 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 NZDT, 8:00am AEDT (4:00pm
USEST) 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: 94752676.

New Zealand Toll Free 0800 446 046  USA Toll Free  1800 742 9301
Australia Toll Free  1800 725 000  Hong Kong Toll Free 800 906 648
United Kingdom Toll Free 0808 234 1369 International  +61 2 8373 3610

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:
94752676.

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:00244148 For:FPH    Type:HALFYR     Time:2013-11-22 08:58:44