ResMed books Q1 profit lift

Medical device maker encouraged by early sales of new products.

ResMed Inc's profit rose nine per cent in its fiscal first quarter, buoyed by revenue growth and widening margins.

However, shares of the company were down 12% to $49.50 in after-hours trading as results came in below expectations.

ResMed develops and markets respiratory products for the treatment of respiratory disorders, including flow generators and humidifiers.

For the quarter ended September 30, ResMed posted a profit of $80.9 million, or 56 cents a share, up from $71.3 million, or 49 cents a share, in the previous corresponding period.

Revenue rose 5.3% to $357.7 million.

Analysts polled by Thomson Reuters expected earnings of 58 cents a share on revenue of $372 million.

Gross margin widened to 63.7%from 61.4% as input costs slipped 1.1%.

Chief executive officer Mick Farrell said the group continued to face a tough competitive product cycle this quarter, though were encouraged by early sales of its just released new mask products.

“The opportunities in sleep and respiratory care remain attractive; we continue to provide our customers with the right solutions to better manage their businesses while providing high quality products to improve compliance and patient care," he said.

"We are focused on continuing to improve the quality of life for patients who suffer from sleep-disordered breathing and its related co-morbidities, such as cardiology and diabetes; respiratory disorders, including chronic obstructive pulmonary disease; preventing disease progression; and saving both in-patient and out-patient costs."

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