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."

InvestSMART FORUM: Come and meet the team

We're loading up the van and going on tour from April to June, with events on the NSW central & north coast, the QLD mid-north coast and in Perth, Adelaide, Melbourne, Sydney and Canberra. Come and meet the team and take home simple strategies that you can use to build an investment portfolio to weather any storm. Book your spot here.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles