Fisher and Paykel Healthcare has delivered the biggest annual profit in its history, with net earnings rising 24 percent to 468.5 million dollars for the year ended 31 March 2026, the East Tāmaki manufacturer told the NZX this morning.
Operating revenue lifted 14 percent to 2.31 billion dollars, narrowly above the upper end of the guidance range the company gave shareholders in a February update. The hospital products division, which makes the respiratory humidifiers and breathing circuits used in intensive care wards and operating theatres around the world, grew revenue 18 percent. The homecare division, dominated by sleep apnoea masks and flow generators, lifted sales 8 percent.
Gross margin widened by 80 basis points to 63.7 percent, a figure most listed manufacturers in New Zealand would consider improbable. The board declared a final dividend of 33 cents a share, up 38 percent on last year’s 24 cents. That takes the total annual payout to 52 cents and commits about 65 percent of net profit back to shareholders.
By yesterday’s close, the company was valued at almost 20 billion dollars, making Fisher and Paykel Healthcare the most valuable business listed on the New Zealand stock exchange. It accounts for a meaningful share of the daily turnover on the index and is a top holding in most KiwiSaver growth funds, which means today’s result will quietly flow into the year-end balances of millions of New Zealanders who never look at their statements.
Chief executive Lewis Gradon told the market the rate of growth was “uncommon” and that the company did not take it for granted. He has run the company since 2016 and has steered it through the Covid-era spike in ventilator demand and the long unwind that followed, when several analysts wrote the company off as a one-off pandemic winner.
That has now been thoroughly disproved. Hospital hardware sales, the slowest part of the business in the post-Covid years as buyers worked through stockpiled ventilators, are back to 18 percent growth. Gradon attributed the gross margin improvement to the company’s continuous improvement programme across the East Tāmaki and Tijuana production lines, alongside a better product mix as the newest generation of respiratory devices takes a larger share of orders.
Two threats sit over the result. The first is United States trade policy. New tariffs on hospital products manufactured in New Zealand cost the company about 90 basis points of operating margin on a constant currency basis this financial year, a hit absorbed largely through pricing and efficiency. The company manufactures a large share of its product range at its plant in Tijuana, just south of the United States border, which has insulated it somewhat from the harder tariff lines but still leaves it exposed to changes in cross-border rules. The Supreme Court has already invalidated one tranche of tariffs imposed under emergency powers, and any refund of duties paid is not included in the result.
The second is the Middle East. Conflict in the region disrupts freight routes between the company’s Mexican plant and customers in Europe and the Gulf, and longer shipping times tie up working capital in inventory. The company flagged both risks as live but not material to the broader outlook.
That outlook is bullish. The board has guided to net profit of between 500 million and 550 million dollars for the year ending March 2027, on operating revenue of between 2.45 billion and 2.57 billion dollars. The midpoint of the profit range would mark another 12 percent lift on this year’s record, and the company continues to commit close to 10 percent of revenue to research and development, the highest ratio of any large listed company in New Zealand.
That research spend funds the steady cadence of new product launches that drives hospital revenue, and it is also the reason the company has not joined the parade of New Zealand corporates dual-listing for tax convenience or floating on the ASX to escape the smaller pool of New Zealand institutional capital. Most of the engineering happens here, the patents sit with the New Zealand parent, and the dividend cheques are paid in New Zealand dollars.
For context, the 468.5 million dollar profit is larger than Air New Zealand and Spark made combined last year, and only Mainfreight comes close among the rest of the industrial sector. Fisher and Paykel Healthcare’s share of NZX market capitalisation has now eclipsed Auckland International Airport, Meridian Energy and Spark on most trading days.
The shares were placed in a trading halt pending the announcement and resume trading later this morning. Most broker forecasts going into today’s result sat at the lower end of the company’s guidance, which sets the stage for upgrades and, in all likelihood, a fresh leg up in the share price.
The result also vindicates an unusual corporate strategy. Most large New Zealand manufacturers have spent the past decade moving headquarters or production offshore. Fisher and Paykel Healthcare has gone the other way, expanding the Auckland campus, doubling the Tijuana plant, and quietly building one of the most globally important respiratory device franchises on the planet, all while keeping the head office on Highbrook Drive.
The full company announcement is on the Fisher and Paykel Healthcare investor site, with extended coverage from RNZ Business and BusinessDesk.
Are you a Fisher and Paykel Healthcare shareholder, directly or through your KiwiSaver fund, and is this the kind of New Zealand corporate story that gets too little airtime alongside the political coverage? Drop your thoughts in the comments below.
This article was written by AI, briefed to report the facts, hopefully without some of the bias people bring to the job 🙂
Leave a Reply