- ResMed (RMD) opens red this morning despite posting increased revenue and profit for the final quarter of the 2021 financial year.
- Revenue grew by 14 per cent for the quarter to US$876.1 million (A$1.18 billion) over the three months to the end of June, with profit up 8 per cent
- This paved the way for a year-on-year profit increase of 12 per cent to US$993.8 million (A$1.34 billion)
- CEO Mick Farrell says the June quarter was a period of “incredible demand” for the company’s products
- However, it seems investors may have been hoping for more; at 10:20 am AEST, ResMed shares are down 3.07 per cent and trading at $36.04 each
Meditech giant ResMed (RMD) has opened red this morning despite posting increased revenue and profit for the final quarter of the 2021 financial year
The ASX 200-lister grew revenue by 14 per cent to US$876.1 million (A$1.18 billion) over the three months to the end of June. On a constant currency basis, this represents a quarterly increase of 10 per cent.
The revenue growth paved the way for an 8 per cent boost to gross operating profit for the quarter to US$241.6 million (A$326.7 million). This is despite a slight 4 per cent dip in ResMed’s gross margin to 56 per cent.
Regardless, ResMed has bolstered its quarterly dividend by 8 per cent and will return US$0.42 (A$57) per share to investors for the June 2021 quarter.
ResMed makes continuous positive airway pressure (CPAP) machines and other devices to treat sleep apnoea, as well as ventilators and other devices for respiratory conditions like chronic obstructive pulmonary disease (COPD) and, recently, COVID-19.
CEO Mick Farrell said the company’s fourth-quarter results demonstrate the “strength and resiliency” of the business.
“During the quarter, we saw the ongoing recovery of core sleep apnoea and COPD patient flow across our business, as healthcare systems continue to adopt new models of patient care,” Mr Farrell said.
He said while the company faced some headwinds and some tailwinds over the June quarter, the net-positive result helped take year-on-year revenue growth to 6 per cent to US$3.2 billion (A$4.3 billion) for the 2021 financial year.
In fact, on a full-year basis, ResMed tabled an operating profit of US$993.8 million (A$1.34 billion) in FY21 — 12 per cent higher than the year before.
“At this time of incredible demand for ResMed products, we are doing everything we can to increase our manufacturing of sleep and respiratory care devices,” Mr Farrell said.
North American driving growth
While ResMed’s revenue in Europe, Asia, and other markets grew by 2 per cent on a constant currency basis over the fourth quarter, the majority of the company’s growth came from North America.
The company said when not including its software-as-a-service (SaaS) numbers, revenue in the US, Canada, and Latin America grew by 18 per cent. The growth, ResMed said, was driven by an increase in demand for sleep devices and masks as patient numbers recovered from a COVID-19-induced rut.
Meanwhile, ResMed’s SaaS revenue grew by 5 per cent over the June quarter.
Mr Farrel said the company is confident in its ability to “grow steadily” through the 2022 financial year, though it has given no indication of earnings or profit guidance just yet.
“We’re driving accelerated adoption of digital health solutions in sleep apnea, COPD, and out-of-hospital care, accelerating our ResMed 2025 strategy,” He said
Nevertheless, it seems investors may have been hoping for more from ResMed’s final quarter of the 2021 financial year.
At 10:20 am AEST, ResMed shares are down 3.07 per cent and trading at $36.04 each. The company has a $39 billion market cap.