Fisher & Paykel Healthcare Corporation Limited · NZX:FPH
Fisher & Paykel Healthcare — H1 FY2009 Earnings Presentation
21 slides from Fisher & Paykel Healthcare's earnings presentation, November 2008
Slide 1: FY09 Half Year Update and Overview
FY09 Half Year Update and Overview
Slide 2: Investment Highlights
Investment Highlights • Leading player in respiratory humidification systems • Consistent growth strategy • Estimated US$2.5+ billion and growing market opportunity • High level of innovation • Global presence • Strong financial performance NZSX:FPH, ASX:FPH 2
Slide 3: Operating Results US$
Operating Results US$ FY09 (6 mths to 30 September) %Revenue US$M %pcp Operating revenue 100% 159.6 +25% Gross profit 55.4% 88.3 +29% Other income (R&D credit) 0.7% 1.1 SG&A 28.2% 45.1 +22% R&D 6.2% 10.0 +17% Total Operating Expenses 34.5% 55.0 +21% Operating Profit 21.6% 34.5 +49% Profit after Tax
Slide 4: Operating Results NZ$
Operating Results NZ$ FY09 (6 mths to 30 September) % Revenue NZ$M %pcp Operating revenue 100% 213.3 +24% Gross profit 55.4% 118.1 +28% Other Income (R&D credit) 0.7% 1.5 SG&A 28.2% 60.2 +21% R&D 6.2% 13.3 +16% Total Operating Expenses 34.5% 73.5 +20% Operating Profit 21.6% 46.1 +48% Profit after T
Slide 5: Markets and Products
Markets and Products Distributed/ • Respiratory & Acute Care OSA Other 2% – Heated Humidification 43% – Respiratory Care – Neonatal Care • Obstructive Sleep Apnea – Masks – Flow Generators – Humidifiers Respiratory & Acute Revenue by Product 55% Consumable and accessory 6 months to 30 September 20
Slide 6: Respiratory Humidification
Respiratory Humidification • Normal airway humidification is bypassed or compromised during ventilation or O2 therapy • Mucociliary transport system operates less effectively – increases risk of infection – impairs gas exchange • Need to deliver gas at physiologically normal levels – 37°C body core
Slide 7: Respiratory Humidification Systems
Respiratory Humidification Systems • MR850 Respiratory Humidifier System – invasive ventilation, O2 therapy and non-invasive ventilation • MR880 Respiratory Humidifier System – simpler controls – O2 therapy • MR810 Respiratory Humidifier System – entry level system – ventilation and O2 therapy – opt
Slide 8: Single-use Respiratory Components
Single-use Respiratory Components • Single-use chambers – patented auto filling MR290 • Single-use breathing circuits – patented spiral heater wire – proprietary Evaqua™ expiratory tube – minimal condensation – delivery of optimal humidity • Breathing circuit components – Filters, catheter mount, we
Slide 9: Neonatal Care
Neonatal Care • Infant CPAP System – proprietary bubble CPAP, non-invasive, oscillating pressure – lower risk alternative to ventilation – high value consumable system • Infant Resuscitator System – precise pressure control – consumable resuscitation kit • Radiant Warmers – warmers required in deliv
Slide 10: Expanding Opportunities
Expanding Opportunities Invasive Ventilation Non-invasive Ventilation O2 Therapy Humidity Therapy Laparoscopic Insufflation COPD Humidity Therapy 10
Slide 11: Respiratory & Acute Care Update
Respiratory & Acute Care Update • 36% revenue growth US$, 30% constant currency • US GPO contracts, consumable backorder catch-up • Estimate underlying growth 20% • New applications generated 24% of consumables revenue 11
Slide 12: Obstructive Sleep Apnea
Obstructive Sleep Apnea • Temporary closure of airway during sleep • Can greatly impair quality of sleep, leading to fatigue; also associated with hypertension, stroke and heart attack • Estimated US$1.8+ billion worldwide market, growing 15% • Potentially 50-60 million affected worldwide • Most co
Slide 13: CPAP Systems
CPAP Systems • SleepStyle™ 230 – patented Ambient Tracking™ humidification technology • SleepStyle™240 – SmartStick™ USB compliance and efficacy recording • SleepStyle™ 600 Flow Generator series – ThermoSmart™ heated breathing tube technology • SleepStyle™ 250 Auto – Auto titration – SensAwake™ tech
Slide 14: Mask Range
Mask Range Four interface categories: • Nasal Masks – patented glider – FlexiFit™ technology – New Zest with EasyClip • Full Face Mask – under chin seal – Patented glider – FlexiFit™ – New Forma™ with Flexifoam™ • Oral Mask – Oracle ™ oral interface • Nasal Pillows Mask – very light – Opus 360™ 14
Slide 15: OSA Update
OSA Update • 15% US$ revenue growth excluding add on humidifiers, 10% constant currency • SleepStyle™ Auto flow generator with SensAwake™ introduced to USA • SleepStyle 240 with compliance and efficacy reporting via SmartStick™ USB introduced • Zest™ and Forma™ masks introduced 15
Slide 16: Research & Development
Research & Development • 240 engineers, scientists, physiologists * • R&D expenses increased 16% in NZ$ • 6.2% of operating revenue • 15% R&D credit from 1 April 08 • Product pipeline includes – Flow generators – Masks – Respiratory consumables • 81 US patents, 60 US pending, 246 ROW, 256 ROW pendin
Slide 17: Manufacturing
Manufacturing • Vertically integrated − electronics assembly − injection moulding − motor assembly • Ample capacity to grow − two buildings 51,000m²/ 550,000 ft² total − 100 acres/40ha land − planning expansion offshore 17
Slide 18: Global Presence
Global Presence • Direct/offices – hospitals, home care dealers Asia Pacific/Other – Sales/support offices in USA/Canada, 22% UK/Ireland, Europe, India, Japan, UAE, China, Taiwan, Turkey, Brazil, Australia and NZ Europe – 400+ staff in 26 countries 32% – Ongoing international expansion • Distributor
Slide 19: Revenue Growth US$
Revenue Growth US$ 290 280 270 FY 2003 260 FY ended 31 March CAGR 250 FY 2004 240 TOTAL 21% 230 FY 2005 220 210 FY 2006 200 190 FY 2007 180 170 FY 2008 US$M 160 150 140 130 CAGR 20% CAGR 24% 120 110 100 90 80 70 60 50 40 30 20 10 0 Respiratory/ OSA Other TOTAL Acute 19
Slide 20: Balance Sheet
Balance Sheet • NZ$100.0M net debt at 30 September 2008 • NZ$186.1M total shareholders equity • NZ$359.7M total assets • Annualised 42% pre-tax return on equity, annualised 23% on total assets • 30% new NZ tax rate from 1 April 08 • 15% R&D credit from 1 April 08 20
Slide 21: Growth Drivers
Growth Drivers Consistent strategy: • Continue to improve existing product lines • Develop complementary products/ consumables • Target new medical applications – e.g. COPD, NIV, O2 therapy, insufflation • Increase international presence 21
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