ResMed shares gain after solid quarterly results
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More news: Shares in ResMed are up 0.5% to $40.71 in early trading on the ASX after respiratory health company posted strong revenue growth and expanded margins across its global sleep and respiratory care businesses in the December quarter.
RBC Capital Markets analysts called the report a "solid result" with both revenue and net income ahead of consensus.
What they said: "Gross margin was a touch softer than market expectations, which could be taken slightly negatively, however we note gross margin was flat sequentially," the analysts said in a note.
"Americas devices and Rest of World devices revenues were a beat, which was partially offset by weaker numbers in RoW masks and SaaS. Overall we expect the revenue and earnings beats to be taken well by the market."
ResMed lifts Q2 revenue, expands margins
The news: Respiratory health company ResMed has posted strong revenue growth and expanded margins across its global sleep and respiratory care businesses in the December quarter.
The numbers: Revenue for the three months to December rose 10% from a year ago to USD1.28 billion ($2.06 billion). Net income jumped 65% from a year ago to USD344.60 million, with the company’s gross margin expanding 300 basis points to 58.6%.
It declared a quarterly cash dividend of 53 US cents, up from 48 US cents a year ago.
The context: The ASX and NYSE-listed ResMed said the revenue growth was driven by increased demand for its sleep devices and masks, as well as solid growth across the Residential Care Software business.
Gross margin increased mainly due to manufacturing and logistics efficiencies and component cost improvements, while selling, general, and administrative expenses also rose due to increases in employee-related expenses.
What they said: “ResMed is well-positioned to capitalise on the once-in-a-generation opportunities we have with the recent introduction and adoption of consumer wearables that track sleep health, as well as use of GLP-1 therapies," chief executive Mick Farrell said.
"We believe these developments will drive increased patient flow as we continue to educate people on the benefits of healthy sleep and breathing, with care delivered right in their own home.”
The source: ASX announcement
