F&P explains its share price drop

Fisher & Paykel Healthcare's board has revised its full-year financial outlook due to a firmer kiwi dollar, but shareholders still have concerns over the lack of returns filtering down the pipe.

At the dual-listed medical equipment manufacturer's annual meeting in Auckland yesterday chairman Tony Carter fielded questions over what one shareholder considered a 23 per cent drop in the value of NZX-listed shares in the past 12 months.

Carter said the share price level had been disappointing but the board had no control over it other than making its successes and future plans well known to the market.

The NZX share price has fallen from $3.10 in May last year to just over $2.00. The price closed 8 cents up at $2.04 yesterday. The ASX price was trading up 6 cents at A$1.58 late yesterday.

"The elevated exchange rate is undoubtedly a major reason for the share price weakness and as mentioned earlier we do have strategies in place to mitigate that," Carter said.

The company makes 99 per cent of its sales outside New Zealand, with 52 per cent of operating revenues generated in US dollars and 23 per cent in euros and has hedging policies in place to cover its currency risk.

Managing director Michael Daniell said hedging strategies were improving the company's "constant currency" gross margin by two percentage points for the first half of the year compared to the first half of last year.

- © Fairfax NZ News