Fisher & Paykel Healthcare Corporation Limited · NZX:FPH
Fisher & Paykel Healthcare — FY2006 Earnings Presentation
22 slides from Fisher & Paykel Healthcare's earnings presentation, 2006
Slide 1: FY06 Full Year Update & Overview
FY06 Full Year Update & Overview
Slide 2: Investment Highlights
Investment Highlights • Leading player in heated humidification systems • Consistent growth strategy • Estimated US$2+ billion and growing market opportunity • High level of innovation • Global presence • Strong financial performance NZSX:FPH, ASX:FPH 2
Slide 3: Operating Results US$
Operating Results US$ FY06 (12 mths) %Revenue US$M %Ìpcp Trading revenue 100% 199.6 +23% Gross profit 70.1% 140.0 +19% SG&A 28.2% 56.3 +24% R&D 5.9% 12.0 +9% Total Operating Expenses 34.2% 68.2 +21% Operating Profit 35.9% 71.7 +18% 3
Slide 4: Operating Results NZ$
Operating Results NZ$ FY06 (12 mths) % Revenue NZ$M %Ìpcp Trading revenue 100% 289.5 +20% Gross profit 70.1% 203.1 +17% SG&A 28.2% 81.7 +21% R&D 5.9% 17.3 +7% Total Operating Expenses 34.2% 99.0 +18% Operating Profit 35.9% 104.1 +16% 4
Slide 5: Markets and Products
Markets and Products Neonatal • Respiratory and Other humidification 11% • Obstructive sleep apnea • Neonatal and other OSA 44% Resp. Hum. 45% ¯ Consumable products represent approx. 59% of core Revenue by Product product sales 12 months to 31 March 2006 5
Slide 6: Respiratory Humidification
Respiratory Humidification • Normal airway humidification is bypassed or compromised during ventilation or O2 therapy • Mucociliary transport system operates less effectively – increases risk of infection – impairs gas exchange • Need to deliver gas at physiologically normal levels – 37°C body core
Slide 7: Expanding Opportunities
Expanding Opportunities Invasive Ventilation Weaning Non-invasive Ventilation O2 Therapy Humidity therapy Laparoscopic Insufflation 7
Slide 8: Humidification Systems
Humidification Systems • MR850 Respiratory Humidifier System – invasive ventilation, O2 therapy and non-invasive ventilation • MR880 Respiratory Humidifier System – simpler controls – O2 therapy • MR810 Respiratory Humidifier System – entry level system – ventilation and O2 therapy – optional heated
Slide 9: Single-use Components
Single-use Components • Single-use chambers – patented auto filling MR290 • Single-use breathing circuits – patented spiral heater wire – proprietary dry expiratory tube – less condensation – delivery of optimal humidity • Breathing circuit components – filters – catheter mount – weaning kit • Inter
Slide 10: Respiratory Humidification Update
Respiratory Humidification Update • 14% revenue growth US$, 17% ex currency • MR850, MR810 penetration driving increasing breathing circuit share • Increasing value per patient • Introduced broad range of single use interfaces, NIV, O2 therapy, humidity therapy • Additional consumables, COPD home sy
Slide 11: 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$1.2+ billion worldwide market, growing 15% - 20% Normal breathing • Potentially 50-60 million affect
Slide 12: CPAP Systems
CPAP Systems • HC150 Humidifier • SleepStyle™ 200 Convertible and Integrated Flow Generator series – greater pressure range, altitude adjustment, enhanced user ergonomics – patented Ambient Tracking™ plus auto- adjusting humidification technology • SleepStyle™ 600 Integrated Flow Generator series –
Slide 13: Mask Range
Mask Range Four interface categories: • FlexiFit™Nasal Masks – patented sliding attachment – FlexiFit™ technology – new 406 Petite model • FlexiFit™Full Face Mask – under chin seal • Oracle™Oral Mask – proprietary oral interface • Infinity™Direct Nasal Mask – very light 13
Slide 14: OSA Update
OSA Update • 53% mask and flow generator revenue growth in US$ • 34% total revenue growth in US$ • Received CMS reimbursement for ThermoSmart tube • Launching Vigor8 program • Additional flow generators, masks in R&D pipeline 14
Slide 15: Neonatal and Warming
Neonatal and Warming • Radiant Warmers – warmers required in delivery and NICU – precise and stable temperature control – opportunity in operating room • Infant CPAP System – proprietary bubble CPAP, non-invasive, oscillating pressure – lower risk alternative to ventilation – high value consumable s
Slide 16: Neonatal and Warming Update
Neonatal and Warming Update • 24% revenue growth in US$, 26% ex currency • Warmers, CPAP and resuscitators all driving growth • Single use resuscitation masks, O2 nasal cannula introduced 16
Slide 17: Research & Development
Research & Development • 190 engineers, scientists, physiologists • 6.0% of revenue FY06 • Product pipeline includes – Flow generators – Masks – Humidification system for COPD therapy – Respiratory consumables • 61 US patents, 71 US pending, 145 ROW, 236 ROW pending * * at 31 Mar 2006 17
Slide 18: Manufacturing
Manufacturing • Vertically integrated − electronics assembly − injection moulding − motor assembly • ISO 9001; Class 100,000 controlled environment • Ample capacity to grow − 300,000ft2 / 28,000m2 facility − 23,000m2 building due for occupation July 2006 − 100 acres / 40 ha 18
Slide 19: Global Presence
Global Presence • Direct – hospitals, home care dealers – Sales/support offices in USA/Canada, Asia Pacific Other 19% 5% UK/Ireland, France/Benelux/Italy/ Spain, Germany/Austria/Switzerland, India, Japan, UAE, China, Taiwan, Sweden, Brazil, Australia and NZ – 350+ staff – Ongoing international expan
Slide 20: Revenue Growth US$
Revenue Growth US$ 210 200 FY ended 31 March CAGR 190 FY 2002 180 CORE 23.2% 170 FY 2003 TOTAL 22.3% 160 FY 2004 150 FY 2005 140 130 FY 2006 120 US$M 110 100 CAGR 19% CAGR 28% 90 80 70 60 50 40 30 CAGR 29% 20 10 0 Respiratory OSA Warming/ Other TOTAL Humidification Neonatal 20
Slide 21: Balance Sheet
Balance Sheet • NZ$28.5M cash at 31 March 2006 • Investing in capacity expansion with construction of NZ$60M second building • NZ$7.0 cps final dividend • NZ$27M ongoing share buyback; NZ$15.3M completed to date • Expect debt to range NZ$45M to NZ$70M in FY07. • NZ$53M land revaluation gain • 53% an
Slide 22: 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 22
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