FPH announces FY24 results, provides FY25 guidance
News Release
STOCK EXCHANGE LISTINGS: NEW ZEALAND (FPH), AUSTRALIA (FPH)
Fisher & Paykel Healthcare announces its FY24 result and provides revenue and
earnings guidance for FY25
Auckland, New Zealand, 29 May 2024 – Fisher & Paykel Healthcare Corporation Limited today
announced its results for the full year ended 31 March 2024.
Total operating revenue for the 2024 financial year was $1.74 billion, an increase of 10% over the
previous financial year, or 8% in constant currency. Growth was driven by solid demand in hospital
consumables and strong growth in the obstructive sleep apnea (OSA) mask business.
Reported net profit after tax for the financial year of $132.6 million was impacted by three abnormal
items which are discussed in further detail below. Excluding these items, underlying net profit after
tax was $264.4 million, a 6% increase over the previous financial year, or 5% in constant currency.
Managing Director and CEO Lewis Gradon said, “After several years of changing demand patterns,
we are pleased to have returned to a trajectory of growth. All the right foundations are in place for
future success – we have an impressive portfolio of products, strong relationships with our
customers and the right infrastructure to meet our future needs,” said Mr Gradon.
For the Hospital product group, which includes humidification products used in respiratory, acute
and surgical care, revenue for the full year was $1.1 billion, up 6% from the previous financial year,
or 5% in constant currency. New applications consumables were up 15% over the previous financial
year, or 13% in constant currency. Consumables sales returned to normal, pre-pandemic patterns.
For the Homecare product group, which includes products used in the treatment of obstructive sleep
apnea and respiratory support in the home, revenue for the full year was $652.3 million, up 18%
over the previous financial year, or 16% in constant currency. Growth was driven by the continued
success of the F&P Evora
TM
Full mask in both North America and Europe.
During the 2024 financial year, the company made progress in returning to its long-term gross
margin target of 65%. Excluding the provision for a product recall, underlying gross margin was
61.1%, an increase of 216 basis points in constant currency over the previous financial year. This
was achieved through lower freight costs, manufacturing efficiencies and pricing, which more than
offset the impact of inflationary cost increases. Including the provision for a product recall, gross
margin was 59.9% for the 2024 financial year, an increase of 95 basis points in constant currency.
New products and market releases
During the 2024 financial year, the company invested $198.2 million into research and development
and continued to deliver innovative products into new markets. In the Hospital product group, the
company received regulatory clearance in the United States – its largest market – for the F&P 950
TM
System, the F&P 820
TM
System and the F&P Optiflow+ Duet
TM
nasal cannula. These products are
used for respiratory humidification and delivering nasal high flow therapy.
In the Homecare product group, the company recently announced two new masks for OSA – the
F&P Solo
TM
and the F&P Nova Micro
TM
. The F&P Solo enables automatic fitting for patients who
prefer to fit the mask without assistance and is already available for sale in New Zealand, Australia
and the United States. The F&P Nova Micro was designed for patients who want to fit the mask
manually. It has been released in New Zealand and Canada, with launches in Australia, Europe and
the United States planned in the 2025 financial year.
Dividend and dividend reinvestment plan
The Board has approved a dividend of 23.5 cents per share for the second half of the year, fully
imputed, to be paid on 10 July 2024. This brings the total dividend for the 2024 financial year to 41.5
cents per share, an increase of 2% over the previous financial year. The dividend reinvestment plan
continues to be in place for this dividend, with an applicable 3% discount.
Outlook for the 2025 financial year
At current exchange rates*, guidance assumptions for the 2025 financial year include no significant
respiratory disease events, and result in full year operating revenue in the range of approximately
$1.9 billion to $2.0 billion and net profit after tax in the range of approximately $310 million to
$360 million. The net profit after tax guidance assumes a further improvement in gross margin
during the 2025 financial year. Capital expenditure for the 2025 financial year is expected to be
approximately $150 million.
“Reflecting on our FY24 performance, we want to acknowledge the people of Fisher & Paykel
Healthcare for their collective efforts. The work we do matters – and year after year, our people
continue to make a difference for our customers and their patients,” said Mr Gradon.
“With a fifty-year track record, we are building on strong foundations. Looking ahead, we are
determined to keep bringing to market new solutions that deliver better outcomes for patients and
sustainable, profitable growth for our shareholders.”
Overview of key results for the 2024 financial year
• 10% growth in operating revenue to $1.74 billion, 8% growth in constant currency.
• 6% growth in underlying** net profit after tax to $264.4 million, 5% growth in constant currency.
• 6% growth in Hospital operating revenue to $1.1 billion, 5% growth in constant currency.
• 15% revenue growth for new applications consumables, 13% growth in constant currency.
• 18% growth in Homecare operating revenue to $652.3 million, 16% growth in constant currency.
• 21% growth in OSA masks revenue, or 18% growth in constant currency.
• Investment in R&D was 11% of revenue, or $198.2 million.
• 2% increase in final dividend to 23.5 cps (2023: 23.0 cps).
• 2% increase in total dividends for the financial year to 41.5 cps (2023: 40.5 cps).
Further financial commentary on FY24 net profit after tax
For the 2024 financial year, reported net profit after tax was impacted by several abnormal items.
First, the financial reporting valuation of the company’s land at Karaka, New Zealand was negatively
impacted by its current zoning status, the higher interest-rate environment, and general
development land market conditions. This difference was recognised as a non-cash accounting
adjustment of $98 million in the income statement. In the company’s view, owning this site mitigates
risk to future growth in light of the current uncertainty around potential development sites in
Auckland. A re -zoning application for the Karaka land will be submitted this calendar year.
Second, net profit was impacted by the change in New Zealand legislation removing tax deductions
for the depreciation of buildings. This resulted in a tax expense of $19.3 million to adjust the
deferred tax liability balance related to the four buildings on the company’s East Tāmaki campus.
Ongoing impacts of this tax change are minimal.
Third, net profit was impacted by a voluntary limited recall of Airvo 2 and myAirvo 2 devices
manufactured before 14 August 2017. When the recall was announced in March 2024, the company
estimated the cost at $12 million. After early responses from customers indicating the number of
remaining Airvo 2 and myAirvo 2 devices affected by the recall, the cost of the recall was revised to
$20 million. This provision was
reported on the company’s income statement through cost of goods
sold.
*At 1 May 2024 exchange rates of NZD:USD 0.59, NZD:EUR 0.56, NZD:MXN 10.14.
**Underlying net profit after tax excludes the abnormal FY24 impact of a product recall provision, the revaluation of land and
deferred tax on removal of building depreciation.
About Fisher & Paykel Healthcare
Fisher & Paykel Healthcare is a leading designer, manufacturer and marketer of products and
systems for use in acute and chronic respiratory care, surgery and the treatment of obstructive sleep
apnea. The company’s products are sold in over 120 countries worldwide. For more information
about the company, visit our website www.fphcare.com.
Media & Investor Contacts:
Karen Knott
GM Corporate Communications
karen.knott@fphcare.co.nz
+64 21 713 911
Daniel Adolph
Head of Investor Relations
daniel.adolph@fphcare.co.nz
+64 22 511 4050
Authorised by Fisher & Paykel Healthcare Corporation Limited’s Board of Directors.
Accompanying Documents
Attached to this news release are the following additional documents:
• Results in Brief
• Annual Report 2024
• Investor Presentation 2024
• NZX Results Announcement
• NZX Distribution Notice
Full Year Results Conference Call
Fisher & Paykel Healthcare will host a conference call today to discuss the results for the 2024
financial year. The conference call is scheduled to begin at 10:00am NZST, 8:00am AEST
Wednesday 29 May (6:00pm USEDT, Tuesday 28 May) and will be broadcast simultaneously
online.
To listen to the webcast, access the company’s website at www.fphcare.com/investor. An online
archive of the event will be available approximately two hours after the webcast and will remain on
the site for two weeks.
To listen and participate in the conference call via phone, please register via ‘GlobalMeet’ by clicking
this link. Once registered, click ‘Call Me’ and you will receive a phone call connecting you through to
the conference line.
Non-GAAP financial information
Constant currency information included within this news release is non-GAAP financial information,
as defined by the NZ Financial Markets Authority, and has been provided to assist users of financial
information to better understand and track the company’s comparative financial performance without
the impacts of spot foreign currency fluctuations and hedging results and has been prepared on a
consistent basis each year. The company’s constant currency framework can be found on the
company’s website at www.fphcare.com/ccf.
Underlying net profit after tax, referenced within this news release, is a non-GAAP performance
measure and is not defined or specified under the requirements of NZ IFRS. The company believes
that this non-GAAP measure, which is not considered to be a substitute for or superior to NZ IFRS
measures, provides stakeholders with additional helpful information on the performance of the
business.
A reconciliation between reported results and constant currency/underlying net profit after tax is
available in the company’s Annual Report 2024.
---
Results in Brief
Adjustments for abnormal items
Year ended 31 March
% Change
(Reported)
% Change
(Constant
Currency
1
)
Product
recall
Revaluation
of land
Deferred
tax
(2)
2024
Underlying
(3)
% Change
Underlying
(Reported)
% Change
Underlying
(Constant
Currency
1
)
2023 2024
NZ$M NZ$M NZ$M NZ$M NZ$M NZ$M
(except as
otherwise stated)
(except as
otherwise stated)
(except as
otherwise stated)
FINANCIAL PERFORMANCE
Operating revenue 1,581.1 1,742.8 10% 8% - - - 1,742.8 10% 8%
Cost of sales (642.7) (698.4) 9% 6% 20.0 - - (678.4) 6% 3%
Gross profit 938.4 1,044.4 11% 10% 20.0 - - 1,064.4 13% 12%
Gross margin 59.4% 59.9% 58bps 95bps - - - 61.1% 172bps 216bps
Selling, general and administrative
expenses
(431.9) (492.8) 14% 13% - - - (492.8) 14% 13%
Research and development expenses (174.3) (198.2) 14% 14% - - - (198.2) 14% 14%
R&D percentage of operating revenue 11.0% 11.4% 35bps 56bps - - - 11.4% 35bps 56bps
Total operating expenses (606.2) (691.0) 14% 13% - - - (691.0) 14% 13%
Operating profit 332.2 353.4 6% 3% 20.0 - - 373.4 12% 10%
Operating margin 21.0% 20.3% -73bps -85bps 21.4% 41bps 36bps
Revaluation of land - (98.1) - 98.1 - -
Profit before financing and tax 332.2 255.3 -23% -31% 20.0 98.1 - 373.4 12% 10%
Net financing (expense) / income (4.2) (19.6) - - - (19.6)
Profit before tax 328.0 235.7 -28% -35% 20.0 98.1 - 353.8 8% 7%
Tax expense (77.7) (103.1) 33% 33% (5.6) - 19.3 (89.4) 15% 12%
Profit after tax 250.3 132.6 -47% -56% 14.4 98.1 19.3 264.4 6% 5%
Effective tax rate 23.7% 43.7% 25.3%
Effective tax rate excluding R&D tax
credit, revaluation of land and removal
of building depreciation
28.5% 30.5% 30.5%
1
Constant currency (CC) removes the impact of exchange rate movements. This approach is used to assess the Group’s underlying comparative financial performance without any impact from changes in foreign
exchange rates. The company’s constant currency framework can be found on the company’s website at www.fphcare.com/ccf. The reconciliation to reported results is included within the Financial Commentary section
of the Annual Report.
2
Deferred tax on removal of building depreciation.
3
Underlying financial performance has been presented excluding the impact of abnormal items during the 2024 financial year. For more information, please refer to page 119 of the Annual Report.
Results in Brief
(continued)
Year ended 31 March
2023
2024
% Change
(Reported)
NZ$M NZ$M
Revenue by Region:
North America 683.8 806.1
18%
Europe 427.6 477.3
12%
Asia Pacific 399.0 368.9
-8%
Other 70.7 90.5
28%
Total 1,581.1 1,742.8
10%
Revenue by Product Group:
Hospital 1,023.5 1,087.9
6%
Homecare 553.8 652.3
18%
Core products sub-total 1,577.3 1,740.2
10%
Distributed and other 3.8 2.6
-32%
Total 1,581.1 1,742.8
10%
As at 31 March
2023
NZ$M
(except as otherwise
stated)
2024
NZ$M
(except as
otherwise stated)
% Change
FINANCIAL POSITION
Tangible assets 2,022.3 2,100.8
4%
Intangible assets
4
182.2 180.9
-1%
Total assets 2,204.5 2,281.7
4%
Total liabilities (451.1) (522.6)
16%
Shareholders’ equity 1,753.4 1,759.1
-
Gearing -2.3% 1.8%
-178%
Net tangible asset backing (cents per
share)
272 271
-
4
Includes Intangible and deferred tax assets.
Year ended 31 March
% Change
2023 2024
NZ$M NZ$M
(except as
otherwise stated)
(except as
otherwise stated)
CASH FLOWS
Net cash flow from operating activities 238.2 429.6
80%
Net cash flow (used in) investing activities (11.3) (339.0)
2,900%
Net cash flow (used in) financing activities (197.1) (128.7)
-35%
SHARES OUTSTANDING
Weighted average basic shares
outstanding
578,140,116 581,972,373
Weighted average diluted shares
outstanding
581,630,919 586,178,934
Basic shares outstanding at period end 579,356,576 583,963,682
DIVIDENDS AND EARNINGS PER
SHARE
Dividends per share (cents) – declared 40.5 41.5
2%
Basic earnings per share (cents) 43.3 22.8
-47%
---
Annual Report 2024
LASTING
FOUNDATIONS
At Fisher & Paykel Healthcare we have
been developing INNOVATIVE SOLUTIONS
for PATIENT CARE, working with clinicians
and expanding our global footprint
for over 50 years.
With an IMPRESSIVE PORTFOLIO of products,
STRONG RELATIONSHIPS with customers and
the RIGHT INFRASTRUCTURE to enable our expansion,
LASTING FOUNDATIONS are in place for sustainable,
profitable growth.
12
Constant currency information contained within this report is non-conform-
ing financial information, as defined by the NZ FMA and has been provided
to assist users of financial information to better understand and assess the
company’s financial performance without the impacts of spot financial
currency fluctuations and hedging results, and has been prepared on a
consistent basis each financial year. A reconciliation between reported
results and constant currency results is available on page 122 of this report.
The company’s constant currency framework can be found on our website
at www.fphcare.com/ccf.
SCOTT ST JOHN
BOARD CHAIR
LEWIS GRADON
MANAGING DIRECTOR
AND CHIEF EXECUTIVE OFFICER
ABOUT THIS REPORT
Welcome to our 2024 Annual Report — Lasting
Foundations. In this report, we feature the work
we have done this year to improve patient care
and outcomes around the world and the financial
results we achieved while doing so.
Our people, investors and customers can also learn
about our track record with regard to non-financial
matters, including environmental, social and
governance (ESG) topics. Our ESG commitments
and metrics are included in Section 3 of this report,
called ‘Operating Sustainably’.
This report aligns with the 2021 GRI Universal
Standards. This report also contains our Climate-
related Disclosures in compliance with the External
Reporting Board’s Aotearoa New Zealand Climate
Standards, which can be found in Section 3.
We welcome your feedback and suggestions
for improvement. Please send any questions or
comments to investor@fphcare.co.nz. A digital
version of this report, along with all previous
annual and interim reports are available at
www.fphcare.com/nz/corporate/investor/reports.
This report covers the financial year ended
31 March 2024 and is dated 28 May 2024. The
report has been approved by the Board and is
signed on behalf of Fisher & Paykel Healthcare
Corporation Limited by Scott St John, Board Chair,
and Lewis Gradon, Managing Director and Chief
Executive Officer.
THE BUSINESS
YEAR
THE
COMPANY
Our company 18
Our culture, values and beliefs19
How our business works20
How we deliver value
21
What matters most22
Sustainable development goals24
Our Board 29
Our Executive Management Team 31
Results at a glance 6
Business highlights7
Hospital & Homecare
performance overview8
Report from the Chair 11
Report from the Managing Director
& Chief Executive Officer13
2Fisher & Paykel Healthcare | ANNUAL REPORT 2024
345
OPERATING
SUSTAINABLY
FINANCIALSAPPENDICES
Five year summary 160
Glossary 163
GRI content index 165
Directory
169
People 36
Community 47
Suppliers53
Risk management
60
Governance65
Remuneration81
Environment 90
Climate-related Disclosures94
Financial commentary 118
Financial statements 123
Notes to the financial statements 127
Auditor’s report
152
Fisher & Paykel Healthcare | ANNUAL REPORT 20243
4
Section 1 | THE BUSINESS YEAR
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
THE
BUSINESS
YEAR
1
Fisher & Paykel Healthcare | ANNUAL REPORT 20245
OPERATING REVENUE
$1 .74b
▲
10% | 2023 $1.58B
GROSS MARGIN
59.9%
58 BASIS POINTS INCREASE
HOSPITAL REVENUE
$1.1b
▲
6% | 2023 $1.0B
NET PROFIT AFTER TAX
$132.6m
▼
47% | 2023 $250.3M
TOTAL DIVIDEND FOR YEAR
FULLY IMPUTED
41.5cps
▲
2% | 2023 40.5CPS
HOMECARE REVENUE
$652.3m
▲
18% | 2023 $553.8M
Results at a glance
46%
27%
21%
6%
OPERATING REVENUE
NZ$ MILLIONS
UNDERLYING NET PROFIT
AFTER TAX*
NZ$ MILLIONS
REVENUE BY PRODUCT GROUP
12 MONTHS TO 31 MARCH 2024
REVENUE BY REGION
12 MONTHS TO 31 MARCH 2024
120+
COUNTRIES
Hospital
Homecare
Distributed & Other
North America
Europe
Asia Pacific
Other
<1%
62%
37%
242322212019
1,681.7
1,581.1
1,742.8
1,971.2
1,263.7
1,072.1
0.000000
87.366667
174.733333
262.100000
349.466667
436.833333
524.200000
242322212019
524.2
287.3
209.2
376.9
250.3
264.4
UNDERLYING NET PROFIT
AFTER TAX*
$264.4m
▲
6% | 2023 $250.3M
SPEND ON R&D
$198.2m
11% OF OPERATING REVENUE
* Underlying net profit after tax excludes the abnormal FY24 impact of a product recall provision, the revaluation of
land and deferred tax on removal of building depreciation. For more information on these impacts, please refer to
the financial commentary on page 119.
Section 1 | THE BUSINESS YEAR
Fisher & Paykel Healthcare | ANNUAL REPORT 20246
Business highlights
IMPACTED
the lives of approximately
20 million patients
around the world
LAUNCHED
new selection and
sizing tools in the
F&P myMask™ app
UNVEILED
revolutionary new F&P Solo™
mask in New Zealand
and Australia
OPENED
third manufacturing facility in
Tijuana, Mexico and progressed
work on new manufacturing
facility in Guangzhou, China
INTRODUCED
the Airvo™ 3 into
more of our key markets
including the US
RELEASED
our online Education Hub
in 22 languages with 21,000+
learning hours accessed by
clinicians globally
OBTAINED
regulatory clearance
in the US for the
F&P 950™ System
COMMENCED
global exports from our
new distribution centre in
Tijuana, Mexico
Section 1 | THE BUSINESS YEAR
Fisher & Paykel Healthcare | ANNUAL REPORT 20247
Hospital
62%
OF OPERATING REVENUE13%$1.1B
Our Hospital product group
includes products used in invasive
ventilation, noninvasive ventilation,
high flow therapy, anaesthesia, and
laparoscopic and open surgery.
Not only do these products help
healthcare providers improve
patient outcomes, they often
deliver economic benefits as well,
by reducing the need to escalate
care and shortening patient stays
in hospital.
CONSTANT CURRENCY REVENUE FROM
NEW APPLICATIONS CONSUMABLES
OPERATING REVENUE
▲ 6%
PRODUCT GROUP OVERVIEW
Our business is structured in
two parts: Hospital and Homecare.
FEATURED PRODUCT
8
Section 1 | THE BUSINESS YEAR
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Homecare
37%
OF OPERATING REVENUE18%$652.3M
Our Homecare product group
includes devices and systems
used to treat obstructive sleep
apnea (OSA) and provide
respiratory support in the
home. These include our CPAP
therapy masks as well as flow
generators, interfaces and data
management technologies.
CONSTANT CURRENCY REVENUE
FROM OSA MASKS
OPERATING REVENUE
▲ 18%
FEATURED PRODUCT
Section 1 | THE BUSINESS YEAR
Fisher & Paykel Healthcare | ANNUAL REPORT 20249
10
Section 1 | THE BUSINESS YEAR
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Report from
the Chair
SCOTT ST JOHN
Board Chair
I am pleased to share with you the
company’s 2024 results, as well as
some of the year’s highlights, in
this report.
Following the last few years of changing
demand patterns, it was encouraging to see
the company continue its trajectory of growth.
We acknowledge the efforts of our people all
around the world, and also are grateful to our
customers, suppliers and clinical partners for
their contribution.
For the 2024 financial year, operating revenue
was $1.74 billion, up 10% from the previous
financial year, or 8% in constant currency.
Reported net profit after tax was $132.6 million,
impacted by three factors — a product recall,
a land revaluation and a change in legislation
regarding tax deductions for buildings.
Excluding these factors, underlying net profit
after tax increased 5% in constant currency.
INFRASTRUCTURE UPDATE
Back in September 2022, we announced the
acquisition of land at Karaka, Auckland for a
second New Zealand campus. The process
of selecting the site was comprehensive and
required several years of research and due
diligence. We were pleased to find a property
two-and-a-half times larger than our existing
New Zealand campus in an ideal location near
a future public transport station and planned
residential developments.
In March we indicated the current zoning status
of the land and higher interest rate environment
would likely adversely affect its valuation.
Following a scheduled valuation as at 31 March
2024, a lower carrying value has now been
recognised. This was recorded as a non-cash
accounting adjustment in the company's income
statement in this report.
Development of the Karaka campus will occur
over 30 to 40 years, with a focus on effecting a
private plan change to re-zone the land, designing
the core infrastructure and commencing
earthworks over the next five years. The
purchase strengthens the company's capacity
to develop innovative products and therapies
long into the future, and in our view, the value to
our business over the long term is unchanged.
We have received an enthusiastic response
from the local community. The Karaka
project leaders are working closely with local
government and tāngata whenua to ensure
everyone’s goals and plans for the future
Section 1 | THE BUSINESS YEAR
Fisher & Paykel Healthcare | ANNUAL REPORT 202411
campus are aligned. We would especially like
to thank our iwi partners, Ngāi Tai Ki Tāmaki,
Te Aakitai Waiohua, Ngāti Te Ata and Ngāti
Tamaoho, for devoting their time and expertise.
SITE VISITS
In September 2023, the Board visited the
company’s operations in Tijuana, Mexico and
Irvine, California. While in Tijuana, we toured
the site and attended the official opening of
the Sánchez Building, the company’s third
manufacturing facility in Mexico. A hub for
global medical device manufacturers, Tijuana
provides access to a highly skilled workforce
and proximity to major markets in the United
States and Canada. In Irvine, we observed
firsthand how the North America team
works closely with clinicians and promotes
the steady progression and usage of F&P
products. Meeting with employees directly
in both locations provided new insights into
the business and the high level of investment
required to manufacture and sell high-tech
medical devices.
YOUR BOARD
During the year we appointed Graham
McLean as a non-executive director to replace
long-serving director Donal O’Dwyer on his
retirement. Graham has carved out a successful
global career in the medical device industry,
and we are benefiting from his experience and
contributions on the Board and the Audit and
Risk Committee.
As I announced recently, I will be retiring from
the Board following the close of this year’s
annual shareholders’ meeting in August, and
Neville Mitchell will take over as Chair. Neville
has been on the Board since 2018, and he
has outstanding credentials. I am confident
the company will continue to thrive under
his leadership.
Identifying strong candidates for Board
succession remains a priority, and the Board
has commenced a search for a candidate with
the right skills and experience to complement
those of other members.
The company continues to participate in
the Future Directors programme, which
gives emerging New Zealand directors an
opportunity to develop governance experience.
Charlotte Walshe was selected as a Future
Director with effect from 1 January 2024.
ENVIRONMENTAL AND
SOCIAL RESPONSIBILITY
Fisher & Paykel Healthcare continues to
expand its reporting on non-financial risks
and opportunities. Government legislation
in New Zealand and in some of our major
markets has called for more stringent
reporting requirements, particularly in
relation to climate change.
In New Zealand, the Financial Sector
(Climate-related Disclosures and Other
Matters) Amendment Act 2021 (CRD Act)
created mandatory reporting requirements
for listed entities to help ensure that the
effects of climate change are routinely
considered in business and investment
decisions. Beginning this financial year and
going forward, the company is required to
publish annual climate-related disclosures in
accordance with these standards.
The Board’s Audit and Risk Committee has
embedded a standing session on Sustainability
to address this topic in every committee
meeting. A changing climate may create new
opportunities and risks in the future, and it may
impact the number of global patients needing
treatment for respiratory illnesses, so it is
critical to take this into account in long-term
business plans.
DIVIDEND
The Board has approved a dividend of 23.5 cents
per share for the second half of the year, fully
imputed, to be paid on 10 July 2024. This brings
the total dividend for the 2024 financial year to
41.5 cents per share. The dividend reinvestment
plan continues to be in place for this dividend,
with an applicable 3% discount.
PROFIT SHARE
On behalf of the Board, I want to thank the
people of Fisher & Paykel Healthcare for
their contribution to the company’s strong
performance. Releasing new products,
improving manufacturing processes and
changing clinical practice year after year
requires focus, adaptability and persistence. To
recognise employees, the Board has approved
a discretionary profit share pool of $9 million
for the year to be distributed to those who have
worked for the company for a qualifying period.
THANK YOU
To our shareholders, I would like to say ‘thank
you’ for your ongoing commitment to Fisher &
Paykel Healthcare — the company is a thriving
global business with strong foundations. Our
respiratory care and obstructive sleep apnea
solutions are market leaders, and we continue
to develop long-term opportunities in other
areas, such as surgery and anaesthesia. In my
view, F&P is in the strongest position we have
been in during my time on the Board. I consider
it a privilege to have had a front-row seat in the
growth of the company and to have worked
alongside such an exceptional team.
Scott St John
Board Chair
12
Section 1 | THE BUSINESS YEAR
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Report from the
Managing Director
& Chief Executive
Officer
LEWIS GRADON
Managing Director and Chief Executive Officer
Achieving sustainable, profitable
growth requires a strong drive
to deliver new products and
therapies, along with knowledge
and evidence, into the hands
of clinicians.
During the 2024 financial year, we stayed
focused on this objective — it’s a proven
formula that has made our business successful.
We invested $198.2 million into research and
development, progressed our product pipeline,
and strengthened relationships with each
other and with experts who are transforming
clinical practice. As always, we maintained a
mindset of continuous improvement, which
is a cornerstone of our culture.
FINANCIAL RESULT
Our consistent strategy delivered a solid
result for the 2024 financial year. Operating
revenue was $1.74 billion, an increase of
10% over the previous financial year, or
8% in constant currency. Revenue growth
was driven by solid demand for hospital
consumables and strong growth in our
OSA mask business.
Underlying net profit after tax for the year
was $264.4 million, a 5% increase from the
previous financial year in constant currency.
As we announced in March, three abnormal
factors adversely impacted reported profit
— property valuations, a change in the tax
treatment of building depreciation, and a
product recall.
Scheduled valuations of the properties at
East Tāmaki and Karaka, Auckland, and in
Tijuana, Mexico were conducted to assess
their value as at 31 March 2024. For the
Karaka land, the 2024 valuation was lower
than the carrying amount on the balance
sheet, and this change was recognised as
a non-cash accounting adjustment in the
income statement. The re-zoning application
for the Karaka land will be submitted in the
2025 financial year. We remain confident it
will be granted, and upzoning land typically
increases its value.
The second factor impacting net profit
was the change in New Zealand legislation
removing tax deductions for the depreciation
of buildings. This resulted in a tax expense of
$19.3 million to adjust the deferred tax liability
balance related to the four buildings on our
East Tāmaki campus.
Section 1 | THE BUSINESS YEAR
Fisher & Paykel Healthcare | ANNUAL REPORT 202413
The third factor impacting net profit was
the company’s voluntary limited recall of
Airvo 2 and myAirvo 2 devices manufactured
before August 2017. As part of the recall,
we committed to replace affected devices
held by customers. An estimated cost of
$20 million was reported on the company’s
income statement, impacting net profit after
tax through cost of goods sold for the 2024
financial year.
During the year we executed on planned
improvements that brought us closer to
achieving our long-term gross margin target
of 65%. For the full 2024 financial year, gross
margin was 59.9%, an increase of 95 basis
points in constant currency. Excluding the
impact of the product recall, underlying gross
margin was 61.1%, an increase of 216 basis
points in constant currency. This was achieved
through lower freight costs, manufacturing
efficiencies and pricing, more than offsetting
the impact of inflationary cost increases
starting to be reflected in the margin.
PRODUCT UPDATE
In our Hospital business, we have continued
to deliver innovative products to the market.
Over the course of this financial year, we
received regulatory clearance in the United
States for the F&P 950™ System and its
associated breathing circuit kits for adult,
pediatric and neonatal patients. The F&P 950
System is a versatile humidification product
that can be paired with our interfaces and
masks to enable invasive and noninvasive
treatments. We also obtained clearance in the
United States for the F&P Optiflow+ Duet™
nasal cannula and the F&P 820™ System
for humidification.
With the F&P Evora Full,
F&P Solo and F&P Nova
Micro, we have a full lineup
of high-performance
masks to accommodate
a wide range of patient
needs and preferences.
In our Homecare business, our F&P Evora™
Full face mask is performing well, and we
have made significant progress developing
our portfolio of masks for treating obstructive
sleep apnea (OSA).
During the 2024 financial year, we introduced
the F&P Solo™ mask. F&P Solo has unique
technology enabling automatic fitting and
one touch to adjust. It is ideal for patients who
prefer to fit the mask without assistance. F&P
Solo has already been launched in Australasia
and the United States, with more markets to
follow during the 2025 financial year.
One week after the 2024 financial year
ended, we unveiled another new compact
mask for treating OSA, the F&P Nova Micro™.
Weighing less than 40 grams, this is our
smallest and lightest mask yet. It appeals to
patients who want to fit the mask manually.
F&P Nova Micro has been released in
New Zealand and Canada, and launches into
Australia, Europe and the United States will
follow later this calendar year.
With the F&P Evora Full, F&P Solo and F&P
Nova Micro, we have a full lineup of high-
performance masks to accommodate a wide
range of patient needs and preferences.
CLINICAL EDUCATION
Working closely with customers is fundamental
to the adoption of new products in the market.
During the year we continued to expand our
global anaesthesia sales team to promote
the clinical benefits of Optiflow Switch™ and
Trace™. Over the 2024 financial year, we added
20 more sales representatives to focus on
anaesthesia products worldwide.
14
Section 1 | THE BUSINESS YEAR
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Our sales teams continued promoting the
evidence for adopting Optiflow™ nasal high
flow therapy and the Airvo™ 3 device for use
in hospitals and homes. This year our team
in Europe brought together more than 30
key opinion leaders to discuss the evidence
for using noninvasive and nasal high flow
respiratory support in emergency departments.
The two-day programme included lectures
and product demonstrations, and attendees
reported that the knowledge they gained
will change the way they manage respiratory
failure in patients.
This year we expanded our online education
resources and released new support materials
in more than 20 languages. Over the course
of the year, our team organised 1,230 online
educational events, and our digital resources
were accessed in 57 countries.
MANUFACTURING
Inflation continued to impact manufacturing
costs and the price of raw materials this year,
so continuous improvement remains a critical
focus across the business. During the year we
consolidated manufacturing lines to adapt to
normal product demand, and we relocated our
export distribution operations from Moreno
Valley in California to Tijuana, Mexico.
In New Zealand, union members voted to sign
a new collective agreement effective from May
2023 until May 2026. The agreement provides
more flexibility, stability and predictability for
the company and for our people, so that we
can grow our manufacturing operations in
New Zealand in a sustainable way.
EXECUTIVE CHANGES
Fisher & Paykel Healthcare now has multiple
manufacturing sites worldwide and a growing
number of distribution locations, so it is
essential that we are well-structured for our
next stage of growth. With this in mind, we
created the new role of Chief Operating
Officer to oversee global operations, with
responsibility for both our manufacturing
and supply chain functions. Andy Niccol
was appointed to this role with effect from
1 April 2024. Andy has more than 20 years of
experience with our business in a variety of
roles in research and development and sales.
At the end of March, Paul Shearer retired as
Senior Vice President – Sales & Marketing
after 33 years with the business. Paul
established our sales operations in our major
markets and grew our sales presence in more
than 50 countries. I wish to thank Paul for
his dedication and support, and I’m pleased
that we will retain his expertise in an advisory
capacity going forward.
Justin Callahan has taken up the mantle as
Vice President – Sales & Marketing. Justin has
more than 30 years of experience with Fisher
& Paykel Healthcare, and he has helped deliver
significant revenue and earnings growth in our
North American business.
ACKNOWLEDGEMENTS
Our Chair Scott St John has announced his
intention to retire from the Board following the
annual shareholders’ meeting in August. We
are grateful for Scott’s guidance throughout
the pandemic and during an exciting time of
growth. Current director Neville Mitchell has
been elected to succeed Scott as Board Chair.
Neville has a strong track record in the medical
devices industry, and we look forward to his
leadership over the next phase.
LASTING FOUNDATIONS
For more than 50 years, we have been
developing innovative solutions, working
with clinicians and expanding our global
footprint. We have amassed an impressive
portfolio of products, built strong relationships
with customers, and invested in new land
and infrastructure. Looking ahead, lasting
foundations are in place for sustainable,
profitable growth over the long term.
In closing, I am pleased with our performance
this year and want to thank the people of Fisher
& Paykel Healthcare, as well as our customers,
suppliers and clinical partners — what we do
matters. I also want to thank our shareholders
for your continued support.
Lewis Gradon
Managing Director and
Chief Executive Officer
Section 1fi|fiTHE BUSINESS YEAR
Fisher & Paykel Healthcare | ANNUAL REPORT 202415
16
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
THE
COMPANY
2
Fisher & Paykel Healthcare | ANNUAL REPORT 202417
Fisher & Paykel Healthcare is a
leading designer, manufacturer and
marketer of products and systems for
use in acute and chronic respiratory
care, surgery and the treatment of
obstructive sleep apnea.
Established in New Zealand in 1969, our
business was built on a vision to emulate the
body’s natural humidification processes. It all
started with Dr Matt Spence, an intensive care
specialist at Auckland Hospital, who noticed
his patients on mechanical breathing machines
were suffering from dry and infected tracheas.
For help solving the problem, he turned to Alf
Melville, a government electrical engineer, and
Dave O’Hare, a senior engineer with appliances
company Fisher & Paykel Industries. The three
collaborated to find an innovative solution, and
the result was a prototype humidifier made
from a humble fruit preserving jar, which was
then designed and manufactured by a small
team at Fisher & Paykel Industries.
Our company
The first respiratory humidifier was sold in
1970 and was marketed internationally.
By 1990, the medical division of Fisher &
Paykel Industries had been renamed Fisher
& Paykel Healthcare, and its annual sales had
grown to $29 million. In 2001, the appliances
business divested, and Fisher & Paykel
Healthcare became a separate company
listed on the New Zealand and Australia
stock exchanges.
Over time, the Fisher & Paykel Healthcare
portfolio has expanded to other clinical
applications, including products for
noninvasive ventilation, high flow therapy,
surgery and the treatment of obstructive
sleep apnea.
Our medical devices and technologies help
clinicians deliver the best possible patient
care in over 120 countries worldwide. They
enable patients to transition into less-acute
care settings, recover more quickly and avoid
more serious conditions.
OUR GROWTH OVER THE YEARS
First
respiratory
humidifier
prototype
developed
Medical
division of
F&P Industries
established
New Zealand
headquarters
inaugurated at
East Tāmaki,
Auckland
F&P Healthcare
separately
listed on NZX
and ASX
Tijuana, Mexico
manufacturing
facility set up
Sales revenue
reaches
$500 million
Sales revenue
surpasses
$1 billion
F&P products
and therapies
help fight
COVID-19
pandemic
Guangzhou,
China
manufacturing
facility
established
IMPACTING PATIENTS IN
120+
COUNTRIES
50+
COUNTRIES WITH
F&P PEOPLE
21
GLOBAL DISTRIBUTION
CENTRES
18
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Our culture, values and beliefs
We have a culture of Care by
Design, which is a simple way
of expressing the care and
intentionality we put into
everything we do — our
relationships, our decisions
and our daily interactions with
customers. We believe that if
we focus on delivering what
is best for the patient, we will
be successful.
OUR VALUES
Life
We relentlessly focus on improving
patients’ lives and strive to provide
a high quality of life for our
employees.
Relationships
We care for our patients, customers,
suppliers, shareholders, the
environment and each other.
Internationalism
We are global in people, in
thinking and in behaviours.
Commitment
We value people who are
self-motivated and have a desire
to make a real contribution.
Originality
We encourage original thinking
which leads to the innovative
solutions required to create better
products, processes and practices.
OUR BELIEFS
We believe in doing what is best
for the patient.
We believe the commitment to
doing the right thing is what our
customers will find compelling.
We believe that empathy,
effectiveness and efficiency
are essential to our success.
We believe our people
are our strength.
We believe lessons learned are
the cornerstones of innovation.
We believe in the need to be
relentless in the pursuit of
healthcare innovation.
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 202419
RESEARCH & DEVELOPMENT
Our R&D is based in New Zealand.
The team works extensively in
hospitals, and with patients and
clinicians, in order to develop better
technology that enhances patient care.
SUPPLY CHAIN
We have distribution centres located
around the world and a network of
distributors. We prioritise sustainable and
cost-effective methods of transportation.
We source materials from all over the
world and look for socially responsible
partners to support our growth.
THERAPIES
The majority of our operating revenue
is from products and systems used
in hospitals in invasive ventilation,
noninvasive ventilation, high flow therapy
and surgery. The remainder is from
products used in home environments to
treat patients suffering from obstructive
sleep apnea and those in need of
respiratory support.
CUSTOMERS
We work with thousands of healthcare
professionals, including doctors, clinicians
and nurses, providing them the products
and tools to deliver the best possible
care. Our products are sold either direct
to customers or through distributors. Our
largest markets by revenue are North
America, Europe and Asia Pacific.
MANUFACTURING
We manufacture our products in
New Zealand and North America.
The co-location of engineering, quality,
manufacturing, marketing and clinical
teams facilitates collaboration and an
awareness of the medical device process
from concept and design right through to
how our products are used by patients.
PATIENTS
Each year millions of patients
are treated with our products in
over 120 countries. Seeking to
understand our patients’ needs is
what drives our R&D programme.
The needs of our customers and their
patients drive everything we do.
We call this Care by Design.
How our business works
20
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
How we deliver value
OUR INPUTSOUR OUTPUTS
Ageing population | Technology advancement | Healthcare costs increasing | Other external factors
MARKET CONTEXT
Our
people
50+ years
of trusted
relationships
Benefits to
our people
Global
supply
networks
Increased
shareholder
value
Excellence
in R&D
Doubling
our constant
currency
revenue every
5-6 years
A lasting,
positive impact
on society
and the
environment
Trusted
brand
Improved
care and
outcomes for
patients
Increased
efficiency
of care
SUSTAINABLE, PROFITABLE GROWTH
We aim to grow our business in a way that is sustainable and profitable over the long term.
OUR PURPOSE
Improving care and
outcomes through inspired
and world-leading
healthcare solutions.
Utilise our expertise
to develop
new therapies
and reduce costs
to healthcare
systems
BETTER PRODUCTS
Continuously strive to
improve our products
GLOBAL REACH
Increase our presence
around the world
CHANGE
CLINICAL PRACTICE
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 202421
What matters most
Investors and other stakeholders
are increasingly using non-financial
information on other material
topics to make decisions. Those
include trends and risks that could
affect a company’s long-term
value, such as climate change, as
well as the economic and social
impacts of doing business.
OUR STAKEHOLDERS
EMPLOYEESCUSTOMERSINVESTORS
CLINICIANSSUPPLIERSCOMMUNITIES
During the 2024 financial year, we worked with
an independent consultant, thinkstep-anz, to
update and validate our assessment of material
topics. Thinkstep-anz obtained feedback by
conducting surveys with internal and external
stakeholders, including our Board, senior
managers, investors, suppliers, customers and
clinicians. Participants were asked to assess
a selection of material topics and rank their
importance to F&P. We also considered our
unique business risks, the United Nations
Sustainable Development Goals, and feedback
we receive through regular interactions with
customers, clinicians, suppliers and investors.
In this latest exercise, we added a new material
topic: ‘climate-related business risk’, which
is defined as understanding and adapting to
impacts that Fisher & Paykel Healthcare might
experience in a changing climate and transition
to a low-carbon economy.
The result is an updated materiality assessment
informed by the principles of the 2021 GRI
Sustainability Reporting Standards. Within this
framework, ‘materiality’ differs from financial and
audit interpretations and NZX/ASX definitions of
material information.
The five topics of highest interest were: patient
safety; product quality; employee health, safety
and wellbeing; innovation; and sustainable financial
performance. These are shown in the upper right
quadrant of our updated materiality matrix.
22
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Materiality matrix
6.06.57.07.58.08.59.09.510.0
6.0
0
6.5
7.0
7.5
8.0
8.5
9.0
9.5
10.0
Patient safety
Product quality
Health, safety & wellbeing
Innovation
Employee attraction,
development & retention
Sustainable financial performance
Nurturing our culture
Resilient & ethical supply chain
Intellectual property
Market access
Customer experience
Legal compliance
Labour practices
Corporate governance
Improving public health
Disruptive technologiesCyber security & data protection
Anti-bribery & corruptionEthical research
Diversity & inclusion
Carbon & energyLocal employment
Healthcare demographics
Business continuity planning
Resource eciency
Community
Healthcare waste management
STAKEHOLDER IMPORTANCE
(AS RANKED BY ALL STAKEHOLDERS)
BUSINESS IMPACT
(AS RANKED BY INTERNAL STAKEHOLDERS)
Climate-related business risk
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 202423
Sustainable
development goals
Fisher & Paykel Healthcare supports the
United Nations Sustainable Development
Goals. We have identified three goals
where we believe we can make a positive
difference in order to achieve a more
sustainable future for all. The goals we
are most closely aligned with are Goal 3,
Goal 8 and Goal 12, and our contributions
are outlined in this section.
24
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
GOAL 3:
Ensure healthy lives and promote wellbeing
for all at all ages
UN SDG targetUN key indicators Our contribution
3.4
By 2030, reduce by one third premature
mortality from non-communicable diseases
through prevention and treatment and
promote mental health and wellbeing.
Mortality rate attributed to cardiovascular
disease, cancer, diabetes or chronic
respiratory disease.
Our Optiflow™ nasal high flow therapy is a first-
line treatment for patients suffering for respiratory
disease, including being used both pre-intubation
and post-extubation. More than six million patients
were treated with our Optiflow therapy over the
past year.
3.6
By 2020, halve the number of global deaths
and injuries from road traffic accidents.
Death rate due to road traffic injuries.Hundreds of millions of people suffer from
obstructive sleep apnea (OSA) globally, and the
associated daytime fatigue creates significant risk
for drivers – there are clinically proven links between
these conditions and traffic accidents. Our range of
OSA masks are used by millions of patients around
the world for a better night’s sleep.
3.8
Achieve universal health coverage, including
financial risk protection, access to quality
essential healthcare services and access
to safe, effective, quality and affordable
essential medicines and vaccines for all.
Coverage of essential health services
(defined as the average coverage of
essential services based on tracer
interventions that include reproductive,
maternal, newborn and child health,
infectious diseases, non-communicable
diseases and service capacity and
access, among the general and the
most disadvantaged population).
The use of our Optiflow™ nasal high-flow therapy
has often been shown to reduce the escalation of
patient care, resulting in not only better outcomes
for the patient but also reducing cost and capacity
constraints for healthcare providers.
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 202425
GOAL 8:
Promote sustained, inclusive and sustainable economic growth,
full and productive employment and decent work for all
UN SDG targetUN key indicators: Our contribution:
8.2
Achieve higher levels of economic
productivity through diversification,
technological upgrading and innovation,
including through a focus on high-value
added and labour-intensive sectors.
Annual growth rate of real GDP per
employed person.
We are a major proponent of research and
development and in the 2024 financial year invested
11% of annual revenue into R&D. We have more than
900 people engaged in clinical research and product
and process development – they are primarily
engineers, scientists and physiologists.
8.3
Promote development-oriented policies that
support productive activities, decent job
creation, entrepreneurship, creativity and
innovation, and encourage the formalization
and growth of micro-, small- and medium-
sized enterprises, including through access
to financial services.
Proportion of informal employment in
total employment, by sector and sex.
We are a significant employer, with a team of
7,031 permanent and 137 temporary employees
(as at 31 March 2024). We are an equal opportunity
employer that values workplace diversity. Of our
full-time permanent employees, 54% are women and
46% are men.
26
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
GOAL 12:
Ensure sustainable consumption
and production patterns
UN SDG targetUN key indicators: Our contribution:
12.2
By 2030, achieve the sustainable
management and efficient use of natural
resources.
Material footprint, material footprint per
capita, and material footprint per GDP.
Domestic material consumption, domestic
material consumption per capita, and
domestic material consumption per GDP.
Aligned with the goals of the Paris Agreement
to limit global warming to 1.5 degrees Celsius, we
have set science-based targets for our Scope 1
and 2 emissions. We are also working with our
suppliers to set their own targets. We recognise
the overall importance of water and other natural
ecosystems. In water-scarce regions we apply good
water stewardship practices such as rainwater
harvesting and closed-loop water systems, and
have established a water re-use plant at our Tijuana
facility in Mexico.
12.5
By 2030, substantially reduce waste
generation through prevention, reduction,
recycling and reuse.
National recycling rate, tons of material
recycled.
We actively reduce waste and recycle materials.
In the 2024 financial year, we diverted 1,348
cubic metres of waste from landfill. Our recycling
efficiency rate was 53%. We also have over 100
product development engineers across the company
involved in our Ecodesign initiative, which is
focused on sustainable packaging, bio-based plastic
technology and sustainable procurement.
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 202427
28
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Scott St John
Chair and non-executive director
TERM OF OFFICE:
Appointed October 2015, last
re-elected 18 August 2021. Appointed
Chair on 21 August 2020.
Scott is Chairman of ANZ Bank
New Zealand Limited and Mercury
Limited, and a director of the ANZ
Group Board and NEXT Foundation.
Scott was Chief Executive Officer of
First NZ Capital from 2002 to 2017. He
is a member of Chartered Accountants
Australia and New Zealand, a fellow of
the Institute of Finance Professionals
of New Zealand and a Chartered
Member of the Institute of Directors.
Bachelor of Commerce, Diploma in
Business
COMMITTEE RESPONSIBILITIES:
Member Audit & Risk Committee.
Member People & Remuneration
Committee.
Member Quality, Safety & Regulatory
Committee.
Lewis Gradon
Managing Director and
Chief Executive Officer
TERM OF OFFICE:
Appointed 1 April 2016, last re-elected
24 August 2022.
Lewis became Managing Director
and Chief Executive Officer in April
2016. Prior to that, he spent 15 years
as Senior Vice President – Products &
Technology, and six years as General
Manager – Research and Development.
During his 41-year tenure with Fisher &
Paykel Healthcare, he has held various
engineering positions overseeing
the development of our range of
products as well the development of
our manufacturing, quality, intellectual
property, supply chain and clinical
research functions.
Bachelor of Science – Physics
Sir Michael Daniell
Non-executive director
TERM OF OFFICE:
Appointed November 2001, last
re-elected 18 August 2021.
Mike was Managing Director and Chief
Executive Officer of Fisher & Paykel
Healthcare from November 2001 to
March 2016. He was General Manager
of Fisher & Paykel’s medical division
from 1990 to 2001 and previously
held various technical management
and product design roles within
the company. Mike is a director of
Cochlear Limited, Tait International
Limited and the Medical Research
Commercialisation Fund. Michael
was named a Knight Companion
of the New Zealand Order of Merit
in June 2021.
Bachelor of Engineering (Hons)
COMMITTEE RESPONSIBILITIES:
Chair Quality, Safety & Regulatory
Committee.
Member People & Remuneration
Committee.
Pip Greenwood
Non-executive director
TERM OF OFFICE:
Appointed June 2017, last re-elected
29 August 2023.
Pip is the Chair of Westpac New
Zealand Limited and also Chair of The
a2 Milk Company Limited. Pip was a
partner at Russell McVeagh between
2001 and 2019 and served as the firm’s
Board Chair. She has advised on many
high-profile corporate transactions.
Pip also served as a member of the
New Zealand Takeovers Panel from
2007 to 2011.
Bachelor of Laws
COMMITTEE RESPONSIBILITIES:
Member Audit & Risk Committee.
Member People & Remuneration
Committee.
Our Board
Section 2fi|fiTHE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 202429
Dr Cather Simpson
Non-executive director
TERM OF OFFICE:
Appointed June 2022, elected 24
August 2022.
Cather is a professor of physics and
chemical sciences at the University
of Auckland and a partner at Pacific
Channel, with expertise in lasers
and photonics. She is a director of
the International Society for Optics
& Photonics (SPIE) and the Dodd-
Walls Centre for Photonic & Quantum
Technologies, and CEO of Orbis
Diagnostics. In 2010, Cather established
the Photon Factory at the University of
Auckland, from which she co-founded
three hard-tech start-ups, including
Engender Technologies, where she
served as Chief Science Officer from
2011 to 2021.
PhD Medical Sciences, Bachelor of
Arts – Interdisciplinary Studies
COMMITTEE RESPONSIBILITIES:
Member Quality, Safety & Regulatory
Committee.
Neville Mitchell
Non-executive director
TERM OF OFFICE:
Appointed November 2018, last
re-elected 24 August 2022.
Neville was Chief Financial Officer
and Company Secretary of Cochlear
between 1995 and 2017. He is a
director of Sonic Healthcare and
Sigma Healthcare, and is a former
director of The Board of Tax, South
Eastern Sydney Local Health District,
Osprey Medical and Sirtex Medical.
Previously, he served on the New
South Wales Medical Devices Fund,
was Chairman of the Group of 100,
and Chairman, Standing Committee
(Accounting and Auditing) for
the Australian Securities and
Investments Commission.
Bachelor of Commerce
COMMITTEE RESPONSIBILITIES:
Chair Audit & Risk Committee.
Member Quality, Safety & Regulatory
Committee.
Dr Lisa McIntyre
Non-executive director
TERM OF OFFICE:
Appointed October 2021, elected 24
August 2022.
Lisa is a director of The University
of Sydney, Studiosity, Nanosonics
and Baymatob. She has previously
been a director of a range of health
entities, including those in healthcare
insurance, clinical service delivery and
medical research and innovation. Lisa
spent 20 years as a senior strategy
partner with LEK Consulting providing
advice to companies in North America,
Asia and Australia.
PhD Physical Chemistry, Bachelor
of Science – Biochemistry and Pure
Maths
COMMITTEE RESPONSIBILITIES:
Chair People & Remuneration
Committee.
Member Audit & Risk Committee.
Graham McLean
Non-executive director
TERM OF OFFICE:
Appointed October 2023.
Graham is a director and CEO of
CleanSpace Technology and the
Chair of Universal Biosensors.
Graham previously spent 16 years
as an executive at leading medical
device manufacturer Stryker
Corporation, most recently as
President of the Asia Pacific region
situated in Hong Kong and Singapore.
Prior to joining Stryker, Graham
had finance, audit and commercial
positions at Lion Nathan, McVitie’s
and Unilever.
Bachelor of Science – Geography
COMMITTEE RESPONSIBILITIES:
Member Audit & Risk Committee.
30
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Lewis Gradon
Managing Director &
Chief Executive Officer
Lewis became Managing
Director & Chief Executive
Officer in April 2016. Prior
to that, he spent 15 years
as Senior Vice President
– Products & Technology,
and six years as General
Manager – Research and
Development. During his
41-year tenure with Fisher &
Paykel Healthcare, he has held
various engineering positions
overseeing the development
of our range of products as
well as the development of
our manufacturing, quality,
intellectual property, supply
chain and clinical research
functions. He received his
Bachelor of Science degree in
physics from the University of
Auckland, New Zealand.
Andy Niccol
Chief Operating Officer
Andy Niccol was appointed
Chief Operating Officer in
April 2024. Prior to that, he
served as General Manager
– Respiratory Humidification
from October 2020 and
General Manager – Infant
Care from December 2015
to September 2020. Andy
has held a number of roles
spanning research and
development, sales and
global original equipment
manufacturer (OEM)
partnerships, since joining
Fisher & Paykel Healthcare
in 2001. Andy received his
Bachelor of Engineering
(Mechanical) degree with
honours from the University
of Auckland, New Zealand.
Justin Callahan
Vice President
– Sales & Marketing
Justin was appointed
Vice President – Sales &
Marketing in April 2024. He
has held several roles in sales
management after joining
Fisher & Paykel Healthcare in
Australia in 1988. Justin took
up the mantle as President
– North America in 1996,
delivering significant revenue
and earnings growth in our
largest market during his
tenure. Most recently, Justin
served as President – North
America & Europe.
Lyndal York
Chief Financial Officer
Lyndal was appointed Chief
Financial Officer in March
2019. Before joining Fisher
& Paykel Healthcare, Lyndal
was CFO at Asaleo Care and
prior to this held Head of
Group Finance and Group
Financial Controller roles at
Cochlear in Australia over
an 11-year period. She has
also spent time in the US, as
VP Corporate Accounting
and Reporting at Edwards
Lifesciences. Lyndal is
a member of Chartered
Accountants Australia and
New Zealand and a graduate
of the Australian Institute
of Company Directors. She
received her Bachelor of
Economics degree from
Macquarie University, Australia
and Master of Business
Administration degree from
Pepperdine University in the
United States.
Dr Andrew Somervell
Vice President
– Products & Technology
Andrew was appointed
Vice President – Products
& Technology in April 2016.
Since joining Fisher & Paykel
Healthcare in 2006, he
has held various product
development and operations
management roles, and most
recently was General Manager
– Product Groups. He has
overseen the development
of the OSA product range
and managed research and
development, marketing,
clinical, manufacturing, and
aspects of the supply chain.
Before joining Fisher &
Paykel Healthcare, Andrew
was a Research Fellow at
the University of Auckland,
New Zealand, and holds a
doctorate in physics from
the same university.
Our Executive Management Team
Section 2fi|fiTHE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 202431
Winston Fong
Vice President
– Surgical Technologies
Winston was appointed
Vice President – Surgical
Technologies in February
2017. Winston previously
served as Vice President –
Information & Communication
Technology from 2010
and has held various IT
management, product and
software development, and
systems engineering roles
in the business since 1999.
Winston received his Bachelor
of Engineering degree with
honours in Electronics &
Computer Engineering
from Manukau Institute of
Technology and Master of
Business Administration
degree from the University
of Auckland, New Zealand.
Nicola Talbot
Vice President
– Human Resources
Nicola was appointed
Vice President - Human
Resources in October 2020.
She has more than 20 years
of experience with Fisher
& Paykel Healthcare. She
worked with our International
Sales team for 14 years and
was appointed to the role of
General Manager – Human
Resources (International
Sales) in 2017. She holds a
Bachelor of Management
Studies with honours in
Human Resources and
Marketing from the University
of Waikato, New Zealand.
Brian Schultz
Vice President – Quality,
Safety & Regulatory Affairs
Brian was appointed Vice
President – Quality, Safety
& Regulatory Affairs in 2015.
Brian previously served as
Quality Manager for New
Zealand Manufacturing
since joining the company in
2011. Prior to joining Fisher
& Paykel Healthcare, Brian
held quality management
positions within the medical
device and pharmaceutical
industries in Australia,
Switzerland, United Kingdom
and the United States. He
received his Bachelor of
Science degree from Grand
Valley State University in
the United States.
Nicholas Fourie
Vice President – Information &
Communication Technology
Nicholas Fourie was
appointed Vice President –
Information & Communication
Technology in February
2017. Nicholas has been
with Fisher & Paykel
Healthcare since 2007, and
in that time has held various
systems engineering and IT
management roles, including
his most recent position as
ICT Manager – Development
& Engineering. Prior to joining
Fisher & Paykel Healthcare, he
worked for the South African
division of BHP Billiton.
Nicholas holds a Diploma in
Computer Engineering from
Damelin School of Information
Technology in South Africa.
Marcus Driller
Vice President – Corporate
Marcus was appointed Vice
President – Corporate in
February 2019. Marcus joined
Fisher & Paykel Healthcare in
2009 as an in-house lawyer
and since that time has held
several roles in legal, investor
relations and communications
and most recently as General
Manager – Corporate. Prior
to joining the company, he
worked for New Zealand law
firm Russell McVeagh where
he specialised in corporate
and commercial law. Marcus
received his Bachelor of
Commerce and Bachelor
of Laws degrees from the
University of Auckland,
New Zealand.
32
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Raelene Leonard
General Counsel & Company
Secretary
Raelene was appointed
General Counsel in March
2019, assumed Company
Secretary responsibilities in
October 2021 and joined the
Executive Management team
in April 2024. She joined
Fisher & Paykel Healthcare
in 2016, bringing with her a
wealth of legal experience
gained across Asia Pacific
and Europe. Raelene received
her Bachelor of Laws and
Bachelor of Commerce
degrees from Victoria
University of Wellington,
New Zealand.
Desh Edirisuriya
General Manager – New Zealand
Operations
Desh was appointed General
Manager – New Zealand
Operations and joined the
Executive Management
team in April 2024. He has
been with Fisher & Paykel
Healthcare since 2000. Over
that time, Desh has held
various roles in business
excellence, manufacturing
operations and product
development, including
leading the company’s
response to COVID-19 and
embedding our culture of
continuous improvement.
Most recently, he served
as General Manager – NZ
Manufacturing Operations
& Business Excellence.
Desh holds a Bachelor of
Engineering (Mechanical)
from the University of
Auckland, New Zealand.
Jonti Rhodes
Vice President – Supply Chain,
Facilities & Sustainability
Jonti was appointed Vice
President – Supply Chain,
Facilities & Sustainability in
April 2022, having served on
the Executive Management
team since 2015. Jonti joined
Fisher & Paykel Healthcare
in 2007 as a product design
engineer, and since that time
has held several roles, both in
New Zealand and the United
States. He holds a Bachelor
of Engineering (Mechanical)
from Auckland University of
Technology and a Master of
Business Administration from
the University of Auckland,
New Zealand.
Malena Ortiz
General Director
– Mexico Operations
Malena was appointed
General Director – Mexico
Operations in October 2020
and joined the Executive
Management team in April
2024. Since starting at Fisher
& Paykel Healthcare in 2011,
she held various roles in
manufacturing operations
overseeing the establishment
and rapid expansion of
the company’s presence in
Mexico. Malena previously
held the position of Plant
Director – Mexico. Prior
to joining Fisher & Paykel
Healthcare, Malena worked for
Covidien (now Medtronic) in
cost accounting. Malena holds
a Bachelor of Accounting
degree from Univer University
and a Master of Management
degree from Panamerican
University, Mexico.
Section 2 | THE COMPANY
Fisher & Paykel Healthcare | ANNUAL REPORT 202433
34Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY
OPERATING
SUSTAINABLY
3
Fisher & Paykel Healthcare | ANNUAL REPORT 202435
Section 3 | OPERATING SUSTAINABLY
People
Our purpose is brought to life by our people
every day. We invest in good people who want
to make a positive lasting impact – people
who value long-term relationships, innovation
and real human connections.
In this section we highlight some of the ways
we create a positive and inclusive culture,
empower our people to keep growing their
knowledge and skills, and provide a safe,
healthy and enjoyable work environment.
36Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | People
TALENT ATTRACTION
IN NEW ZEALAND
35%
INCREASE in intern
applications
RETAINING TALENT
IN NEW ZEALAND
35%
OF OPEN ROLES filled
by existing employees
153
INTERNS recruited
71%
HIRED AS GRADS from
previous year interns
Talent attraction and retention
We seek to build a pipeline of talented people, from interns and graduates
to senior technical and leadership positions. We believe in giving all
employees every opportunity to learn, grow and advance toward their
full potential, and rewarding them for their contribution to our success.
Our aim is to build a team of good people doing good work with intent.
A key part of our talent strategy begins with intern and graduate
recruitment where we work closely with local tertiary institutions. We
participate in career expos and engage on social media to recruit talent
in a broad range of functions such as engineering, marketing, finance
and ICT. We continue to sponsor student events and engineering
societies to increase our brand awareness and build strong partnerships.
During the 2024 financial year, we implemented a number of
improvements to our recruitment and selection process including many
focused on diversity, equity and inclusion, such as offering candidates
new options for communicating their skills and experience. We saw a
35% increase in intern applications over the previous financial year.
In New Zealand, we recruited 153 interns for the summer, and 71% of
the new graduate roles for 2024 were filled by previous interns. We also
welcomed three high school student interns through a collaboration with
the Fisher & Paykel Healthcare Foundation and two of its funding partners.
This year, nine early career marketers participated in our Early Careers
Marketing Programme, gaining specialised knowledge, networking and
mentorship in marketing.
Our marketing graduates connected with VPs Jonti Rhodes and Andrew Somervell
(back row, second and third from left) to gain insights into their career journeys at F&P.
Retaining our people
Our commitment is to provide our people
with ways to learn, develop and progress their
careers, and reward them for their contribution
over the long term. We understand that
people’s needs and goals can be different,
and we consider retention activities specific
to the needs of our people and in line with
our culture.
As outlined in the Remuneration section,
we aim to reward our people fairly based
on individual performance and contribution,
the size of their role and the market context.
Employee remuneration is reviewed annually,
and employment arrangements can be tailored
to meet individual needs.
In addition to regular pay, we offer a
discretionary profit share scheme payable
every six months. During the 2024 financial
year, the total profit share pool amounted to
$9 million and was divided among employees
who met the qualifying criteria.
In New Zealand, Australia, the United States
and Canada, we offer an employee share
purchase scheme whereby our people
may purchase shares at a discount. During
the 2024 financial year, over 2,200 eligible
employees participated.
In the 2024 financial year, 35% of open roles
at our New Zealand campus were filled
by existing employees. Globally, employee
turnover was down compared with the
previous financial year, as shown in the tables
on page 39.
Fisher & Paykel Healthcare | ANNUAL REPORT 202437
Section 3 | OPERATING SUSTAINABLY | People
Workforce composition
The tables below provide insight into the composition of our workforce by
headcount as at 31 March 2024, and into hire rates and retention rates.
People numbers
BY REGION
FY2023FY2024
RegionPermanentTemporaryPermanentTemporary
New Zealand3,515373,47491
Mexico1,686832,26527
Rest of World1,248151,29219
Total6,4491357,031137
BY GENDER
FY2023FY2024
GenderPermanentTemporaryPermanentTemporary
Women3,308843,78981
Men3,106513,20554
Gender diverse7080
Not specified/Prefer not to say280292
Total6,4491357,031137
BY NATURE OF ROLE (full-time and part-time*)
FY2023FY2024
GenderFull-timePart-timeFull-timePart-time
Women3,272363,75732
Men3,085213,18520
Gender diverse7080
Not specified/Prefer not to say271281
Total6,391586,97853
* Does not include New Zealand temporary employees (casual, fixed-term, temporary, temporary part-time and contract
temporary) due to the changing nature of their hours.
Leadership by age
The table below shows the age ranges of our people among our
Board members, senior executives, management and all employees as at
31 March 2024.
FY2023FY2024
Under 30
years old
30 – 50
years old
Over 50
years old
Under 30
years old
30 – 50
years old
Over 50
years old
Board008008
Senior executives
1
074074
Management (VP-1)
2
14516
All employees
3
1,6503,6601,1391,8433,9481,240
FY2023FY2024
% Under 30
years old
% 30 – 50
years old
% Over 50
years old
% Under 30
years old
% 30 – 50
years old
% Over 50
years old
Board––100%––100%
Senior executives
1
–63.6%36.4%–63.6%36.4%
Management (VP-1)
2
1.6%72.6%25.8%
All employees
3
25.6%56.7%17.7%26.2%56.2%17.6%
1 The term “senior executive” refers to the Chief Executive Officer, executives reporting directly to the Chief Executive
Officer, and the General Counsel and Company Secretary who reports directly to the Board.
2 Management (VP-1): This includes senior managers who report into the Executive Management team. This is the first
year we have reported them as a separate category.
3 Temporary employees are not included in the above numbers.
38Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | People
Hire rates*
BY REGION
FY2023FY2024
RegionNew employeesHire rateNew employeesHire rate
New Zealand53015%33110%
Mexico32719%76334%
Rest of World25621%21317%
Total1,11317%1,30719%
BY GENDER
FY2023FY2024
GenderNew employeesHire rateNew employeesHire rate
Women56117%83922%
Men52617%45814%
Gender diverse3–––
Not specified/
Prefer not to say
23–1031%
Total1,11317%1,30719%
BY AGE GROUP
FY2023FY2024
Age groupNew employeesHire rateNew employeesHire rate
Under 30 years old52031%67035%
30 – 50 years old52214%58215%
Over 50 years old716%555%
Total1,11317%1,30719%
* Hire rate is the number of permanent employees hired divided by total headcount for that region or category.
Employee turnover rates
BY REGION
FY2023FY2024
RegionNumber of leaversTurnover rateNumber of leaversTurnover rate
New Zealand44813%39011%
Mexico74844%47221%
Rest of World18815%17114%
Total1,38421%1,03315%
BY GENDER
FY2023FY2024
GenderNumber of leaversTurnover rateNumber of leaversTurnover rate
Women77824%54114%
Men60119%48615%
Gender diverse––114%
Not specified/
Prefer not to say
5–517%
Total1,38421%1,03315%
BY AGE GROUP
FY2023FY2024
Age groupNumber of leaversTurnover rateNumber of leaversTurnover rate
Under 30 years old61537%41922%
30 – 50 years old67719%52413%
Over 50 years old928%907%
Total1,38421%1,03315%
Fisher & Paykel Healthcare | ANNUAL REPORT 202439
Section 3 | OPERATING SUSTAINABLY | People
Learning and
leadership development
Our learning and leadership development approach incorporates
experiential learning, online learning, workshops and self-paced
development activities – all underpinned by a culture of coaching.
One of the first learning opportunities is our welcome induction, where
new hires gain essential knowledge about our purpose, values, policies,
and requirements for working in a medical device company. In the 2024
financial year, 382 employees were inducted in New Zealand.
Employee development
Throughout their careers, we provide our people with opportunities to
continue learning and earning qualifications. Learning options include
general workplace skills, digital skills, technical qualifications, clinical
education and formal diplomas and degrees.
Below are some highlights from the 2024 financial year.
• In New Zealand, we recorded 11.5 average training hours per salaried
employee.
• 46 Mexico employees completed skills training in public speaking,
coaching and labour management, and 10 completed national trade
certifications through the National Council for Standardization and
Certification of Labor Competencies.
• More than 20 New Zealand employees gained skills in
communication and numeracy and 18 were trained at our new
injection moulding training centre.
• Two cafeteria assistants graduated as fully qualified chefs from
the New Zealand Qualifications Authority, and two chefs earned
assessors’ certificates.
• We sponsored 12 employees to complete a Master of Medical
Engineering degree at the University of Auckland in New Zealand.
• In Mexico, we partnered with local universities to sponsor six
employees working toward engineering, business and finance
degrees.
40Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | People
LEADERSHIP
DEVELOPMENT
724
PEOPLE attended
Leadership learning
across 66 sessions
6
GLOBAL leadership
forums hosted by
our team in Australia
Leadership development
We provide new and experienced managers with guidance, resources
and tools to become better leaders through classroom-based learning,
workshops and online platforms. Topics include situational leadership,
coaching, emotional intelligence, resilience, continuous improvement,
personal efficiency and leadership essentials.
During the 2024 financial year, our New Zealand team held 66 leadership
learning sessions with a total attendance of 724 people. Our team in
Australia hosted six global leadership forums, with over 250 senior
leaders participating.
Performance feedback
Our coaching culture is fundamental to our way of working and helping
our people be better at what they do.
Our focus is on managers and their team members having regular
coaching conversations, in the moment and throughout the year, to
recognise recent successes and provide feedback on opportunities
for improvement. These moments help to unlock solutions, embed our
culture and help our people reach their full potential and contribute
over the long term. These conversations guide decisions on contribution
ratings and assessments, which happen formally once a year.
Insights into
hospital environments
Employees attend a learning session at the Simulation Centre for
Patient Safety at the University of Auckland, New Zealand.
Developing new products requires a deep
understanding of the hospital environment.
Our research and development teams visit
hospitals regularly to engage with experienced
doctors, nurses and respiratory care specialists
around the world to understand their needs and
challenges, and to grow their knowledge of care
environments across neonatal, pediatric and
adult specialities.
Some of our products are used to support
patients in the intensive care units, where it can
be challenging for observers to be present. To
help our people gain practical insights into these
environments, we also run simulations with
hospitals and universities. In a typical simulation,
hospital caregivers demonstrate a relevant task
using our products, while our teams practise the
task, record and question the caregiver to clearly
understand their process.
Fisher & Paykel Healthcare | ANNUAL REPORT 202441
Section 3 | OPERATING SUSTAINABLY | People
Diversity, equity and inclusion
To achieve our purpose, we nurture a culture that is collaborative,
open, diverse, honest and inclusive – a place where everyone
can find belonging. Our approach is to embed diversity, equity
and inclusion (DEI) into everything we do by implementing the
following fundamentals:
• A global approach encompassing all demographics, identities,
backgrounds and experiences
• High performing teams built with the best possible people, free
of bias, unconscious or otherwise
• An environment where people are empowered to take an active
role in DEI
• A positive and inclusive culture based on trust and respect
• Supporting brighter and healthier communities through care and
collaboration.
We review the effectiveness of our DEI Procedure annually and
monitor our performance against it, reporting to the Board any
recommended changes to our measurable objectives, strategies
or the way in which they are implemented.
During the 2024 financial year, we made considerable progress
toward our DEI objectives, and this was acknowledged by our
Board of directors. The highlights included:
• Gathering insights and progressing actions in our
international regions
• Analysing recruitment strategies and data
• Compiling ethnicity data to inform future initiatives
• Reporting our overall gender pay gap in New Zealand for
the first time.
IDEA Council and employee-led networks
At our largest campus in New Zealand, our Inclusion, Diversity, Equity
and Awareness (IDEA) Council helps to progress work in DEI. During the
2024 financial year, the IDEA Council provided input into our updated DEI
Procedure and advised on ways to embed DEI into key business initiatives.
Our employee-led networks help to create an environment where our
people feel safe and valued. During the 2024 financial year, a new
employee-led network called ReThink was launched to provide awareness
and support around neurodiversity, and we look forward to seeing them
develop the network.
Spectra
Spectra is our employee-led network for our rainbow communities.
During the 2024 financial year. Spectra engaged more than 250 employees
in rainbow inclusion through awareness events and training. In February,
the group celebrated Pride Month through four events, which included
rainbow awareness 101 sessions, a fundraiser for rainbow mental health
charity OutLine, and a drag bingo social event.
Employees attend a Rainbow 101 awareness session.
42Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | People
Manaaki
Manaaki supports people of Māori heritage to develop their leadership
skills and cultural connection. During the 2024 financial year, the
Indigenous Leadership Programme continued its third cohort, with 18
participants of Māori or Pasifika heritage undertaking wānanga (learning
sessions), coaching and group projects. Completed projects included
hosting a student open day on campus and a printed guide showcasing
learning and development courses and employee communities. Manaaki
also hosted a learning session that explored Te Tiriti o Waitangi (the Treaty
of Waitangi) through the eyes of author, Māori language advocate and
artist Sir Haare Williams (Tuhoe, Rongowhakāta, Ngāti Porou), after his
recent artistic exhibition on the history of the Waikato area.
FY2023FY2024
WomenMenGender diverseWomen %Men %Gender diverse %WomenMenGender diverseWomen %Men %Gender diverse %
Board35–37.5%62.5%–35–37.5%62.5%–
Senior executives
1
38–27.3%72.7%–38–27.3%72.7%–
Management (VP-1)
2, 4
1745–27.4%72.6%–1646–25.4%73.0%–
All employees
3, 4
3,3083,106751.5%48.4%0.1%3,7893,205853.9%45.6%0.1%
WiEng
WiEng supports and empowers women in technical roles. This year
WiEng doubled its size to more than 300 members. The group held
eight networking and learning events including a speaker panel where
employees who are mothers discussed their experiences.
Gender diversity
The table below shows gender diversity among our Board members, senior executives, senior management and all employees as at 31 March 2024.
The table does not reflect the addition of new members to the Executive team which took effect from 1 April 2024.
Hamish Campbell
(Ngāti Raukawa ki te Tonga) and
James Milne (Ngāti Awa, Waikato
Tainui) of Manaaki present a
koha (gift) to Sir Haare Williams
(centre). The koha was
handcrafted from recycled rimu
wood by James Milne.
For International Women’s Day, WiEng held a workshop called Investing in Women, covering
topics such as wealth, education, culture and healthcare.
1 The term “senior executive” refers to the Chief Executive Officer, executives reporting directly to the Chief Executive
Officer, and the General Counsel and Company Secretary who reports directly to the Board.
2 Management (VP-1): This includes senior managers who report into the Executive Management team.
3 Temporary employees are not included in the above numbers.
4 Employees who have not specified their gender are not included in the above numbers.
Fisher & Paykel Healthcare | ANNUAL REPORT 202443
Section 3 | OPERATING SUSTAINABLY | People
Gender pay equity
Fisher & Paykel Healthcare has been reporting on gender pay equity
since 2017. Gender pay equity is about making sure people are paid fairly
regardless of their gender. We continue to monitor this on a regular basis
across our global locations.
Like-for-like gender pay gap
The like-for-like gender pay gap is the difference between the mean
pay of men and women in like-for-like roles. ‘Like-for-like’ comparisons
consider the type and size of roles and experience.
The like-for-like gender pay gap measures whether men and women
receive equal pay for equal work. We previously reported our like-for-
like gender pay gap as our gender pay ratio. Starting this year, we have
included only salaried roles when we measure our like-for-like gender
pay gap. Pay rates for our people covered by a collective agreement are
fixed, based on skills and position, so there is no difference in pay within
like-for-like roles.
SALARIED EMPLOYEES
LIKE-FOR-LIKE GENDER PAY GAPFY2023FY2024
New Zealand1.4%0.7%
International regions3.4%4.6%
Note: This table differs from the gender pay ratio we reported in FY2023.
The data in the table above reflects the like-for-like gender pay gap at a
single point in time. We regularly monitor this metric and take action as
needed to ensure all employees are paid fairly regardless of gender.
Overall gender pay gap – New Zealand
During the 2024 financial year, we committed to reporting our overall
gender pay gap for employees based in New Zealand. The overall gender
pay gap measures the difference in median pay between men and women.
It does not take into account the nature of the role or the type of work
done. As at 31 March 2024, our overall gender pay gap was 36%.
Our overall gender pay gap is shaped by the composition of our
workforce, and it is influenced by the distribution of men and women
across the business. At Fisher & Paykel Healthcare, a higher proportion
of men occupy higher-paying roles such as engineering while a higher
proportion of women are employed in manufacturing roles.
Human rights
Fisher & Paykel Healthcare fully supports the principles in the United
Nations Declaration on Human Rights and the International Labour
Organisation Declaration on Fundamental Principles and Rights at Work,
including non-discrimination, freedom of association and collective
bargaining, and freedom from forced and child labour. We seek to uphold
human rights in all business activities.
Our team in Mexico continued to progress initiatives to help ensure
everyone is treated with dignity and respect. The team provided training
on women’s rights, diversity and inclusion, and non-discrimination.
Through our Integrity Protection Committee, 70% of our Mexico
employees were trained on how to identify, prevent and report sexual or
workplace harassment. We also engaged local government agencies in
Mexico to provide specialised services in psychological counselling, gender
violence support and addiction treatment for our people.
Employees received support through a collaboration with the Municipal
Institute for Women, which offers care for victims of violence; the Women’s
Justice Center, which offers legal counsel and complaints services; and the
Municipal Institute Against Addictions, which provides psychological and
addiction counselling.
Collective bargaining agreements
Our people have the freedom of association to negotiate work relations
effectively. We support sound collective bargaining practices to help
ensure employees have an equal voice in negotiations and that the
outcome is fair and equitable for everyone. In the 2024 financial year,
39% of our global employees were covered by collective bargaining
agreements.
In December 2023, Fisher & Paykel Healthcare agreed on a new collective
employment agreement with the representative unions in New Zealand.
The new agreement is effective for three years, which offers our people
more stability and job security. Our Mexico team completed collective
agreement negotiations with their representative unions in February 2024.
44Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | People
Health and safety
Providing a safe, healthy and enjoyable work environment is a
fundamental way we care for our people and enable them to deliver their
best work.
During the 2024 financial year, we completed a number of initiatives
focused on continuously improving the safety of work across the
company. Across our major global operations, we refreshed our critical
risk assessments for nine work activities. These focused on understanding
and improving what we must have in place and functioning well to ensure
that our people can work safely. The outcome of our efforts is a risk-
based approach to managing health and safety risks.
In New Zealand, we reviewed our contractor management processes and
identified opportunities to improve our risk assessment and monitoring
processes undertaken by contractor managers. Our intention is to begin
implementing these improvements in the 2025 financial year.
We also made enhancements to the processes that support
injury and illness rehabilitation for our employees in New Zealand.
These improvements have established reliable and effective processes
and tools that enable employees to recover safely and return to
contributing their best.
In Mexico, we received certification in the Entornos Laborales Seguros
y Saludables (Safe and Healthy Workplace Environments) programme.
This voluntary programme provides us with preventative strategies
and actions designed to improve the health, safety and wellbeing of
our people. In addition, we completed medical assessments for 81%
of employees who perform manual material handling as part of our
ergonomic assessment programme this year.
The occupational health clinics at our New Zealand and Mexico campuses
continue to provide specialist support and advice to help our people
identify, prevent and manage the effects of work on their health.
Services include new starter health checks, occupational physiotherapy,
rehabilitation support, vaccination services, nutrition management and
health monitoring.
At our campus in Tijuana, Mexico, we organised a range of health
campaigns in the 2024 financial year for our people and their families.
These included breast cancer screening, cervical cancer screening, flu
vaccination, eye checks and clinical health analysis. Our on-site weight
loss programme supported 542 employees to shed a total of 597
kilograms. We also worked with our cafeteria team to provide healthier
meal options for our people.
Health and safety data
INJURY RATES BY YEAR (per million hours worked)
Injury Rates20232024
TRIFR
1
1.423.37
LTIFR
2
1.002.65
1 Total recordable injury frequency rate
2 Lost time injury frequency rate
INJURY RATES (per million hours worked) AND SEVERITY
New Zealand MexicoRest of world
202320242023202420232024
TRIFR1.526.710.280.002.781.51
LTIFR1.525.470.000.001.190.75
Fatality000000
Serious injury000000
Lost time injury9320032
Medical treatment injury031042
Restricted work injury050000
First aid injury1541631826711
Pain and discomfort1441956378
A contributing factor to the increase in the injury rates for New Zealand
was the change to operating a more flexible manufacturing workforce in
New Zealand, which commenced at the end of the 2023 financial year. This
means that employees work in different manufacturing areas based on
product demand and resourcing requirements, rather than working in only
one manufacturing area. We are developing a company-wide ergonomic
risk management strategy and tactics to mitigate this risk.
Fisher & Paykel Healthcare | ANNUAL REPORT 202445
Section 3 | OPERATING SUSTAINABLY | People
Mental health and wellbeing
Alongside physical health and safety,
we understand the importance of
mental health and wellbeing in helping
our people work well and live better.
Our employees worldwide and their
immediate family members have
access to a confidential Employee
Assistance Programme (EAP) to
address their mental health needs. At
our New Zealand and Mexico campuses,
we have psychologists available at our
occupational health clinic to provide
counselling for employees.
During the 2024 financial year, we
completed the pilot for our Hei Oranga
Hinengaro Mental Wellbeing Champion
Network in New Zealand. An initial cohort
of 46 employees have been trained to
facilitate wellbeing conversations and
encourage our people to use wellbeing
support and EAP services. The pilot was
a success and will be rolled out across
the New Zealand campus.
In Mexico, we supported more than
200 people by providing psychological
counselling consultations on site. In
addition, we provided off-site assistance
to 60 people and 80 family members
with mental health needs through our
collaboration with the Tijuana Mental
Health Hospital.
During the 2024 financial year, we
installed free period products into
bathrooms across our New Zealand
campus. Providing free period products
is a small, yet impactful step towards
creating an inclusive and caring work
environment, supporting the wellbeing
of our people, and ensuring our people
have access to products to manage
their periods with dignity and ease.
SUPPORTING
OUR PEOPLE
EAP
GLOBAL ACCESS for
our employees and
immediate family to
access a confidential
service for mental
health needs
46
TRAINED to facilitate
wellbeing conversations,
a successful pilot, now
to be applied across the
NZ campus
Free
PERIOD PRODUCTS
installed in bathrooms
across our NZ campus
200
PLUS Mexico
employees supported
with psychological
counselling
consultations on site
46Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | People
Community
We are committed to supporting our local
communities and building trusted, long-term
relationships to create better outcomes for all.
We believe this will help us create a positive
lasting impact on society and the environment.
The medical devices and therapies we provide
have a direct impact on improving millions of
people’s lives around the world. Our community
work focuses on funding clinical research,
improving access to healthcare, promoting science
education and supporting local environmental
initiatives. We also foster sustainable partnerships
with tāngata whenua (Māori) and maintain a
principled and viable tax strategy.
In New Zealand, many of our philanthropic activities
are coordinated and funded by the Fisher & Paykel
Healthcare Foundation. In other countries, our
people select and sponsor local community
initiatives that connect to our purpose.
This section features some of the ways we seek
to build brighter and healthier communities through
care and collaboration.
Fisher & Paykel Healthcare | ANNUAL REPORT 202447
Section 3 | OPERATING SUSTAINABLY | Community
Fisher & Paykel Healthcare
Foundation
Set up as a registered charitable entity in March 2021,
the Fisher & Paykel Healthcare Foundation’s purpose is supporting
healthier communities. It aims to achieve that by focusing on
three key areas – health, education and environment – supporting
people and organisations that help those who are underserved
and underrepresented.
Foundation initiatives and highlights of FY24
The focus of this year was to strengthen existing partnerships as
well as improve understanding of the impact of its support, as the
Foundation continues to evolve and fulfil its purpose.
In FY24, the Foundation provided $1.125 million in grants and
donations to 15 community organisations, of which 11 are multi-year
partners and three were associated with specific events. Fisher &
Paykel Healthcare employees organised volunteers to assist with
some of these events.
Day in the Life at F&P
This event was envisioned to support the purpose of the Foundation’s
partner organisations in increasing the representation of Māori
and Pacific young people in Science, Technology, Engineering and
Mathematics (STEM).
In October 2023, the Foundation hosted 30 students and six teachers
from South Auckland and Waikato high schools for a day at the F&P
Auckland campus. These students were interested in STEM careers and
empowered by partner organisations Pūhoro STEMM Academy, Kiwibots
and First Foundation. Over 30 volunteers from F&P contributed 180
hours to bring this event to life.
Students participated in interactive panel discussions, simulations and
group activities, and gained insights into career pathways listening to
Māori and Pacific engineers share their personal journeys that led them
to work in technology.
Students at a panel discussion on career pathways hosted by experienced F&P professionals during the
Day in the Life event.
FY24 FOUNDATION SUPPORT
$1.125M
IN GRANTS AND DONATIONS TO
15
COMMUNITY ORGANISATIONS,
OF WHICH 11 ARE MULTI-YEAR PARTNERS
48Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Community
Kura Cares Charity
This charity aims to improve the lives of whānau
(family) in low-income areas by focusing on
hauora (health) principles, which include mental,
spiritual and physical health, and the importance
of family. It supports Māori and Pacific families in
South Auckland by providing essential capability
programmes to help lift them out of poverty,
with the aim of building stronger communities
for the future and reducing income inequality.
Following its contribution in FY23 and noting
the progress made with over 40 graduates
and 90% graduation rate from their Whānau
Hotaka Programme teaching financial literacy,
the Foundation renewed its funding to Kura
Cares in FY24 for an additional three years to a
total value of $167,727. This will help the charity
extend the reach of this programme.
Some of the graduates of the Whānau Hotaka Programme organised by Kura Cares Charity.
Fibre Fale
A purpose-led collective founded to create
pathways for Pacific people in tech, Fibre Fale
designs and delivers programmes and platforms
to build skills, nurture belonging and provide
support for the community at every stage in their
tech journey.
In FY23, the Foundation contributed $150,000
to develop content for the Tautai Tech skills
series and Tautai Tech industry podcasts, as
well as Fibre Fale fonos, networking events for
South Auckland Pacific people. These initiatives
saw over 1,000 Pacific people engage at these
events and 2,398 followers connect across their
social platforms.
In FY24, the Foundation decided to renew
funding to Fibre Fale for an additional three
years to a total value of $389,649. This will
support salary costs for Fibre Fale to continue
growing and streamlining their tech-oriented
offerings, enable Pacific people to have digital
equity and encourage them to enter the digital
tech industry.
40+
GRADUATES and
90% graduation rate
from the Whānau
Hotaka Programme
teaching financial
literacy
1,000+
PACIFIC PEOPLE engaging
at Fibre Fale events and
2,398 followers across
social platforms
Fisher & Paykel Healthcare | ANNUAL REPORT 202449
Section 3 | OPERATING SUSTAINABLY | Community
2023 summer studentship graduates at Kidz First Children’s Hospital, Auckland.
New trustees Dr Mataroria Lyndon
and Rachel Petero.
Dr Mataroria Lyndon
(Ngāti Hine, Ngāti Whātua,
Ngāti Wai, Waikato)
Mataroria is a clinician and
academic who has a number of
governance roles spanning health,
academics and sport, including
the board of Te Aka Whai Ora
Māori Health Authority and Pūtahi
Manawa Centre of Research
Excellence for heart health.
Dedicated to health equity, he
was previously Deputy Chair of Te
Hiringa Hauora Health Promotion
Agency NZ and a board member of
the Northland District Health Board.
Mataroria is also the co-founder of
Tend Health and a senior lecturer in
medical education at the University
of Auckland.
Rachel Petero (Waikato Tainui
– Ngāti Tamaoho, Ngāti
Whawhakia, Ngāti Te Ata,
Ngāti Tahinga)
Rachel is an entrepreneur, author
and advocate for gender equity,
diversity and inclusivity through
her leadership roles in governance,
business and community
development. She serves as the
co-chair of Te Ohu Whai Ao Trust,
a trustee of Ngāti Tamaoho boards,
vice chair of UNICEF Aotearoa
New Zealand and a director of
Te Rau Korimako. Rachel founded
Rise Global to empower indigenous
women and holds a mana whenua
advisory position for Otara
Bluelight Committee’s Te Huringa o
te Tai o ngā Wāhine programme for
young Māori and Pacific girls.
Māori Child Health Research Collaborative
The Collaborative aims to enable equitable health outcomes
for Māori children. It runs equity-based research projects out of
Kidz First Children’s Hospital in South Auckland, offers summer
studentships to Māori and Pacific medical students, and supports
research fellowships for Māori and non-Māori medical professionals
committed to improving health outcomes for Māori children.
The Foundation has committed funding to the Collaborative
for eight years to the value of $600,000, with the partnership
currently in its third year. Funding has so far supported 19 summer
studentships, and the qualification of one nurse practitioner,
alongside a range of fellowships focused on equity-based
research projects.
The Foundation’s previous funding for the Implicit Bias research
project resulted in an ongoing development programme and
resources integrated into Kidz First Children’s Hospital during
the 2024 financial year.
New independent
trustees appointed
In February 2024,
the Fisher & Paykel
Healthcare Foundation
welcomed Rachel Petero
and Dr Mataroria Lyndon
as new independent
trustees to the Board.
50Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Community
Developing partnerships with
tāngata whenua (Māori)
Fisher & Paykel Healthcare supports local Māori communities in line
with the principles of Te Tiriti o Waitangi (the Treaty of Waitangi).
We value the unique ancestral, cultural, customary and historical
knowledge and expertise of tāngata whenua (indigenous people of
New Zealand) to help us create a positive lasting impact on society
and the environment.
Our focus this year has been building partnerships with local iwi (tribes)
Ngāti Tamaoho, Ngāti Te Ata and Te Aakitai Waiohua to help inform the
development of the future Karaka campus. This has included offering
tours of the existing East Tāmaki campus and the Karaka land, aligning
priorities and setting long-term goals. Specifically, and in line with the
Māori value of kaitiakitanga (guardianship of land), the environment,
water quality, the re-establishment of native species and sustainability
innovations have formed the focal point of the discussions.
As we develop the Karaka land over time, our iwi partners will
provide cultural inductions to increase our knowledge of its history
and significance.
We are also continuing our work with Ngāi Tai Ki Tāmaki on
the development of our East Tāmaki campus and have recently
reestablished links with Te Aakitai Waiohua in this space as well.
Ngāti Tamaoho environment team visit our Karaka site in New Zealand.
Supporting communities in Mexico
This year, the Fisher & Paykel Healthcare team in Mexico joined forces
with the National Council of the Maquiladora and Export Manufacturing
Industry in Baja California to support the victims of Hurricane Otis,
which wreaked havoc in Acapulco in the state of Guerrero. Our people
in Tijuana generously donated food, clothing, medicines, bottled water
and items for cleaning and personal hygiene.
Our Mexico team also ran a successful campaign in December 2023 to
collect and send Christmas gifts of toys and sweets to young survivors
of human trafficking through the International Network of Hearts, a
charity that supports children recovering from exploitation.
Donations from F&P Mexico for survivors of Hurricane Otis.
Fisher & Paykel Healthcare | ANNUAL REPORT 202451
Section 3 | OPERATING SUSTAINABLY | Community
Global initiatives
In addition to the Foundation-led initiatives in New Zealand, our teams
across our global sites supported community initiatives linked to our
purpose. In North America this year, our people raised funds to support
the St. Jude Children’s Research Hospital, a pediatric treatment and
research facility for childhood cancer and other life-threatening diseases.
F&P Australia held fundraisers during the 2024 financial year to support
local charities such as the Monash Health Lung and Sleep Institute,
Cancer Council Victoria and Movember for Men’s Health.
Sustainable tax strategy
Collecting and paying tax is an important contribution to the communities
in which we operate. In support of our overall business strategy and
objectives, we pursue a tax strategy that is principled, transparent and
sustainable in the long term.
Our Group’s tax contribution includes paying corporate income taxes,
employment-related taxes and other taxes that we pay or collect on behalf
of governments. We support the OECD Business and Industry Advisory
Committee (BIAC) Statement of Tax Principles for International Business
and have endorsed these principles in our published Group Tax Strategy,
which was last reviewed and approved by our Board in November 2023.
Our tax strategy sets out our approach to tax governance and tax
management and is aligned to our conservative approach towards tax
risk. Its primary purpose is to ensure that we comply with all of our tax
obligations, undertake all transactions with a business purpose considering
all of our stakeholders, and have an open and transparent relationship with
tax authorities.
Our business model is centred in New Zealand, and the majority of
our taxes are paid in New Zealand. Most of our manufacturing activities
and tangible assets are located in Auckland. All of our R&D is performed
in New Zealand, and the associated intellectual property is owned in
New Zealand as well.
The F&P North America team ahead of their fundraiser event to support St Jude Children’s
Research Hospital.
52Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Community
Suppliers
Our approach is to build trusted long-term
relationships with suppliers whose values
align with ours – who understand that we
are all responsible for doing the right thing;
complying with regulations, policies,
standards and procedures; and exercising
good judgement.
In this section we provide an overview of
our sustainable procurement processes and
how we manage modern slavery risks in
our supply chains and operations globally.
Fisher & Paykel Healthcare | ANNUAL REPORT 202453
Section 3 | OPERATING SUSTAINABLY | Suppliers
Sustainable procurement
Supplier Sustainability
Conference
70
LOCAL SUPPLIERS
participated in sessions
on collaborating to
reduce our carbon
footprint
During the 2024 financial year, we held
our first Supplier Sustainability Conference
in New Zealand. Our goals were to
educate suppliers on our approach to
environmental and social responsibility and
facilitate their alignment with our values
and practices in sustainable procurement.
Around 70 local suppliers participated
in sessions on collaborating to reduce
our carbon footprint, including our
Scope 3 emissions, and the future direction
of our Supplier Engagement programme.
Suppliers were presented with awards
for progressing into the intermediate,
proficient and advanced categories of
social and environmental sustainability.
2,000+
20+
4
TIER 1 SUPPLIERS to New Zealand and
Mexico manufacturing sites
Countries
Continents
BASED IN
ACROSS
TIER 1 : A direct supplier to
Fisher & Paykel Healthcare
TIER 2 : A supplier to one of
our suppliers (sub-supplier)
TIER 3 : A sub-sub supplier
1
2
3
Suppliers are a vital link in our product
supply value chain, which begins at the
source of raw materials and ends with a
customer providing patient care. We are
committed to building a supply chain aligned
with our approach to corporate social
responsibility and environmental sustainability.
We seek to maximise opportunities for
companies and communities to thrive, all
while promoting safe working environments
and sustainable outcomes.
Operating in a sustainable way depends not
only on what we do, but on the activities of
our supply chain. For that reason, we seek to
purchase goods and services from suppliers
that minimise negative impacts and increase
positive outcomes through sustainable and
ethical business practices.
Our responsible sourcing process includes
selecting and collaborating with suppliers
who align with our values, providing education
and support on relevant standards, and
enabling our people to speak up in cases
of non-compliance.
The raw materials and components we
use to manufacture our products come
from a network of suppliers around the
globe. Our core products are manufactured
in New Zealand and Mexico, while the
raw materials and components used to
manufacture them come from a network of
global suppliers. A large portion originates
from suppliers in Asia and North America.
We use an integrated enterprise resource
planning system and a strong quality
management system to ensure that our supply
chain is transparent and coordinated across
our global network. Our practices are based
Responsible sourcing
on and aligned with ISO 20400 for Sustainable
Procurement. To support our suppliers and
ensure transparency, our local teams personally
interact with and visit suppliers’ operations
where possible.
54Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Suppliers
Overview of our supply chain
Canada
United Kingdom
Switzerland
IndiaHong Kong
Malaysia
New Zealand
USA
Mexico
Dominican Republic
Germany
Sweden
Austria
Italy
Turkey
Thailand
Singapore
Taiwan
Japan
Australia
China
Costa Rica
Fisher & Paykel Healthcare | ANNUAL REPORT 202455
Section 3 | OPERATING SUSTAINABLY | Suppliers
Eradicating modern slavery
As part of our commitment to do the right thing, we recognise that we
have a role to play in guarding against and eradicating modern slavery.
We have processes in place that identify and address modern slavery
risks within our supply chain and aid our procurement decisions. These
include our Code of Conduct, Supplier Code of Conduct, and Supplier
Engagement programme. We recognise these processes do not
eliminate the risk of modern slavery and continue to remain focused on
raising awareness, assessing our suppliers, and supporting our suppliers
to address modern slavery risks.
We fully support the principles in the United Nations Universal
Declaration of Human Rights and the International Labour Organisation
Declaration on Fundamental Principles and Rights at Work, including
non-discrimination, freedom of association and collective bargaining,
and freedom from forced and child labour.
Modern slavery risks in our operations
and supply chains
Fisher & Paykel Healthcare Group has assessed the key modern slavery
risks in its operations and supply chains within New Zealand and
internationally. As a large manufacturer, we recognise that our risk is
likely moderate in respect of potential modern slavery risks.
To determine where the biggest risk of potential modern slavery lies
within our supply chain, we undertake due diligence and evaluate direct
suppliers that provide products or services used in our medical devices
or in the manufacturing of such devices. Using a heat map, we identify
the geographical regions where our suppliers are located and cross-
reference the prevalence of modern slavery in those regions with the
most recent Global Slavery Index.
While we source globally, a large portion of the externally procured
products and services for our operations originates from suppliers in
Asia and North America, with highest-risk categories being electronics
and textiles. Through this heat-mapping exercise, we undertake a
sustainable risk-based approach and focus first on the geographical
areas of potential highest risk. To support our suppliers in high-risk
regions and to ensure transparency, our local teams personally interact
with and visit our suppliers where possible to understand and evaluate
their operations.
Our approach to addressing modern slavery risks
We are committed to building a supply chain aligned with our approach
to social responsibility and sustainability. Our approach is holistic and
considers economic, environmental and social factors. We use an
integrated enterprise resource planning system and a strong quality
management system to ensure that our supply chain is transparent and
coordinated across our wider supply chain network.
We acknowledge that the highest-risk factors which could potentially
link to modern slavery violations within our supply chain and operations
relate to the use of forced labour, with particular risks for migrant workers.
Specifically, use of forced labour covers potential risks for deceptive
recruitment of labour, including retention of passports and other identity
documents, or poor working conditions and pay.
We survey suppliers to understand their risk profile and have on-the-
ground support for suppliers in New Zealand, Mexico and China, where
we have a larger presence. We have a sustainable procurement specialist
based in Hong Kong to support all suppliers within the Asia region, which
we have identified as having the highest potential of modern slavery. We
also contract with third parties to assist with deep-dive assessments on
the environmental and social responsibility impacts of our supply chain.
Our suppliers must confirm their commitment to our Supplier Code
of Conduct, which was last updated in September 2022. A supplier
assessment form must be completed by suppliers whose goods or
services are used to manufacture our products or have the potential
to impact the safety of our people or products. From the information
requested on this form, we are able to assess the supplier and (where
applicable) their subcontractors’ history and commitment to fair, ethical
and legal employment practices and the eradication of child, forced or
compulsory labour in their supply chain and operations.
We complete a global sustainability risk assessment annually based on
our knowledge and understanding of the sustainability impacts relating
to the materials we source, our supply chain and sourcing countries.
We have developed a sustainable procurement framework aligned with
ISO 20400 standards (Sustainable Procurement) to provide structure
around identifying, monitoring and addressing risk, along with our
approach to building a culture of awareness and knowledge on social and
environmental topics relevant to our supply chain.
56Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Suppliers
Our policies focused on addressing
modern slavery risks
We have a number of policies and procedures that address modern
slavery risks and drive our purchasing decisions. These include our Code of
Conduct, Supplier Code of Conduct, Speak Up Procedure, Environmental &
Social Responsibility Policy and Responsible Minerals Sourcing Procedure.
These are described below.
Code of Conduct
We expect our directors, employees, executives and contractors to
maintain high ethical standards. Our Company Code of Conduct applies
to all employees, executives, directors and contractors within the Fisher &
Paykel Healthcare Group globally.
The Code covers a range of areas relevant to legal and ethical behaviour,
including but not limited to, competing fairly, health and safety, working
with customers and suppliers, sanctions compliance, and combating
bribery and corruption. The Code has been translated into a number of
different languages for our global offices. Regular training on our Code of
Conduct is undertaken by employees globally and is part of our induction
process for new employees. New directors are provided a copy of the
Code of Conduct during their induction training.
Supplier Code of Conduct
Our Supplier Code of Conduct reflects our values and expectations for
all suppliers, contractors and consultants who provide goods or services
to Fisher & Paykel Healthcare. The Supplier Code of Conduct sets out
minimum standards expected of suppliers.
Our Supplier Code of Conduct sets out the requirements for suppliers to
treat people with dignity and respect, including but not limited to:
• not hiring or using forced, compulsory and/or child labour
• promoting awareness around the importance of a diverse and inclusive
workforce
• having systems in place for the review of internal policies and practices
in order to have an inclusive approach
• respecting employee rights to freedom of associated and collective
bargaining.
Should a supplier fail to comply with the Supplier Code of Conduct, as a
first step we would work with the supplier to identify and mitigate risks to
support them to change their behaviour and general practices addressing
modern slavery risks. Continued or repeated breaches of the Code may
result in termination of the arrangements between us. In addition to the
Supplier Code of Conduct, our Australian entity, Fisher & Paykel Healthcare
Pty. Ltd, also has additional onboarding processes for suppliers in respect
of finance, quality and regulatory.
Speak Up Procedure
We have a global Speak Up Procedure that sets out how actual or
suspected breaches of the Code of Conduct, or any potentially unethical
or illegal behaviour, can be reported without fear of retaliation or
harassment. As part of the Speak Up Procedure, we have engaged an
independent third party to provide a service so reports can be made to
them if people choose to do so. The third-party service provider then
provides relevant details back so that appropriate action can be taken. We
have since expanded this service so that it can be used by our suppliers
and third-party contractors to report suspected or actual modern slavery
violations. This process provides greater clarity across our supply chain
and ensures there can be disclosure by suppliers without reprisals.
Environmental & Social Responsibility Policy
Our Environmental & Social Responsibility Policy was introduced in
February 2022, and it applies to all of Fisher & Paykel Healthcare’s
operations and locations. It states that our intention is to create a positive
lasting impact on society and the environment. One of the fundamental
ways in which we want to achieve this is through verifying and validating
our environmental, social and ethical performance, and that of our
suppliers. It sets out that we will collaborate with others to continuously
improve this performance. This includes building trusted long-term
relationships to create better outcomes for all, as well as striving to
provide a high quality of life for our employees and support our suppliers
to do the same for their people.
Fisher & Paykel Healthcare is committed to complying with the letter
and spirit of laws and regulations relating to environmental and social
responsibility. Our Environmental and Social Responsibility Governance
group is tasked with establishing a framework to embed the Environmental
& Social Responsibility Policy and enable business integration of
environmental and social responsibility workstreams and initiatives,
including within our operations and supply chain.
Fisher & Paykel Healthcare | ANNUAL REPORT 202457
Section 3 | OPERATING SUSTAINABLY | Suppliers
Responsible Minerals Sourcing Procedure
In April 2022, we implemented our Responsible Minerals Sourcing
Procedure, which sets out the way Fisher & Paykel Healthcare will
source and use minerals. We understand the importance of actively
mitigating human rights abuses and other risks related to the extraction
of specific minerals from areas where armed conflict and human
rights abuses may occur. We work with existing suppliers and monitor
supply chain risks related to conflict minerals to ensure responsible
minerals sourcing.
As part of the ongoing process of due diligence, we steer our suppliers
(and their supply chains) to source minerals from smelters validated
through the Responsible Minerals Assurance Process or an alternative
equivalent. Our process for responsible minerals sourcing is consistent
with the OECD Due Diligence Guidance for Responsible Supply Chains
of Minerals from Conflict-Affected and High-Risk Areas.
Training
All Fisher & Paykel Healthcare employees globally are required to
complete regular training on our Code of Conduct. Employees working
in Quality, Procurement and Sourcing receive additional training on
the principles and processes we follow to manage our supply chain,
including our due diligence and risk assessment and management
processes and procedures.
Our assessment of the effectiveness
of our approach
At Fisher & Paykel Healthcare, we are committed to reviewing
our supply chains and operations to continuously assess modern
slavery risks. As a large organisation with a complex supply chain,
we acknowledge that we need to continue to treat this as a priority.
We assess and address modern slavery risks as an ongoing process.
To assess the effectiveness of our efforts, we regularly report
to the Board’s Audit & Risk Committee. The Committee is
responsible for reviewing and monitoring our environmental and
social risk management framework, as well as how proposed actions
are performed.
If a potential or actual modern slavery incident is identified in our supply
chain or operations, it is treated in a similar way to other violations,
such as a material health and safety incident. Our approach primarily
focuses on engaging and collaborating with suppliers where any potential
breaches have been identified, to implement remedial measures. This
includes corrective actions to address the underlying causes and violations
to prevent reoccurrence.
In the event that a supplier does not engage with us or fails to remediate
a material issue, we would consider appropriate next steps, including
suspending sourcing or supply of services and/or terminating the
relationship.
Within our sustainable procurement framework, we have categorised
suppliers to establish a baseline for each and define a course for their
development. The categories are as follows:
• Embarking: Suppliers at an early stage with few – or no – policies
focused on social responsibility
• Intermediate: Suppliers that have policies and some internal controls
in place covering social responsibility
• Proficient: Suppliers that are identifying and actively working to
mitigate modern slavery risks both within their organisation and also
their supply chain
• Advanced: Suppliers that have enlisted third-party verification to assess
their modern slavery processes and risk mitigations.
We continue to assess and support Embarking and Intermediate suppliers’
development to help them achieve a Proficient status.
We are not aware of any modern slavery violations in our supply chain and
operations during the 2024 financial year.
During the 2024 financial year, responsible supply chain assessments were
performed through a combination of self-assessment surveys, research on
suppliers’ publicly available disclosures, third-party assessments, site visits
and audits.
Following these assessments, 65 suppliers were engaged with, one-to-one,
to support their development. Twenty-eight suppliers were subsequently
upgraded within our categorisation criteria. Three suppliers were found
to have potential non-compliance with local labour laws regarding benefit
entitlements, payment of wages for overtime and exceeding maximum
working hours. Some of these issues have been remediated during the
2024 financial year, and others have required development plans, which
we have put in place.
58Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Suppliers
FY24
Progress in FY24
• HOSTED an inaugural Supplier
Sustainability Conference in
New Zealand to educate and
recognise suppliers in environmental
and social responsibility
• COMPLETED pilot deep-dive of
high-risk areas in our supply chain
with third-party specialist
• ROLLED OUT sustainable
procurement framework in Mexico
• TRAINED employees on modern
slavery risks
Focus areas for FY25 and FY26
• CONTINUE IMPROVING internal and
external reporting and disclosure
• CONTINUE DEVELOPING and
measuring key performance
indicators to monitor effectiveness
of our initiatives
• CONTINUE TRAINING employees on
modern slavery risks
• CONTINUE MAPPING multiple tiers of
our supply chain to obtain greater
visibility of key commodities
• DEVELOP digital learning resources to
educate suppliers on topics covered
in our Supplier Code of Conduct
• REVIEW and update relevant supplier
agreements to include specific
modern slavery clauses
• HOST a Supplier Sustainability event
in Mexico
Addressing modern slavery
• CONDUCTED one-to-one
engagements with 65 suppliers
• UPGRADED the status of 28
categorised suppliers in accordance
with our supplier categorisation
criteria
• COMMENCED mapping of
Tier 2 suppliers
• PILOTED assessment with group
of Tier 2 suppliers
Fisher & Paykel Healthcare | ANNUAL REPORT 202459
Section 3 | OPERATING SUSTAINABLY | Suppliers
Risk management
Our approach to risk management is to identify
and manage risks within acceptable levels. While
no risk management system can ever be infallible,
we seek to improve the quality of our business
decisions by applying a bespoke framework and
aligning with international standards.
In this section we summarise our strategies to
govern and manage business risks, and to ensure
our products meet the expectations of patients,
caregivers and regulatory authorities.
60Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Risk management
Governance of risk
Our Board is committed to its role of ensuring quality, safety, compliance
and effective risk management. The Board provides oversight of senior
leadership’s management of risk. The Board meets regularly with key risk
management functional leaders and receives regular reports from senior
representatives on material risk and mitigation strategies.
The Audit & Risk Committee reports to and assists the Board by reviewing
and ensuring our business risk management processes (excluding any risks
related to quality, safety and regulatory functions) can provide reliable
information to the Board on the status of major risks that could impact
our business.
The Quality, Safety & Regulatory Committee reports to and assists the
Board by reviewing our quality, health and safety and regulatory risk
management approach. The Committee ensures effective mechanisms and
internal controls are in place to identify and manage areas of material risk
and maintain compliance with applicable regulations.
Product quality and patient safety
Our products are used to treat millions of people around the world each
year, so it’s important that our products meet high quality standards. Our
intention is that the quality of our products and processes and our good
relationships with regulators provide a competitive advantage and enable
better outcomes for patients.
The medical device industry is highly regulated worldwide. We strive
to ensure that the quality of the products we distribute meets the
expectations of patients, caregivers and regulatory authorities and
facilitates market acceptance of our products.
We manage product quality with processes that drive continuous
improvement throughout the lifecycle of our products. These include:
• verification and validation of product requirements to meet user needs
• proactive quality control mechanisms within our manufacturing
operations
• collecting and using data and statistical analysis to make improvements
• interventions to correct a process before product quality is
compromised.
Quality management for products
Our Quality Management System (QMS) incorporates processes that
have an impact on product quality and regulatory compliance. Our
QMS is compliant with ISO 13485:2016 Quality Management Systems
for Medical Devices and meets the requirements of various international
regulations. We participate in the Medical Device Single Audit Program
with our QMS audited against the requirements of several global
regulatory authorities.
Our QMS and related processes are continuously reviewed for ongoing
improvement. We have processes in place for the regular auditing
and review of the system for ongoing suitability and effectiveness.
This includes the review and audit by notified bodies and regulatory
agencies, to ensure continued compliance.
The Vice President – Quality, Safety & Regulatory Affairs has executive
accountability for quality and regulatory affairs, and along with the
executive management team, oversees the performance of the QMS to
ensure it remains effective and efficient and continues to improve. The
Quality, Safety & Regulatory Committee of the Board also has oversight
of the QMS and receives regular quality system specific reports as part
of our internal audit function.
All of these processes help to ensure that our customers and patients
receive high-quality products that are safe and effective.
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Section 3 | OPERATING SUSTAINABLY | Risk management
Quality and safety throughout the
product lifecycle
We develop high-quality products that meet the needs of patients,
clinicians and caregivers. Product requirements are driven by detailed
understanding of user needs. As part of the design process, products
are thoroughly tested and validated to ensure they deliver on those
requirements and meet applicable standards for intended use.
We ensure our manufacturing activities produce products that meet
specifications through robust manufacturing technology, processes and
controls. Our global product supply chain is set up to deliver products
that meet customer expectations, through great relationships with
our suppliers, effective inventory and distribution management, and
distribution partners worldwide.
We then continue to review real-world customer experience through
an extensive post-market surveillance process to ensure our products
continue to deliver on customer needs. The information we gather
throughout the product lifecycle is used to identify improvements to our
current and future products.
Regulatory clearance for products
Prior to sales and distribution in any country, our products are verified and
validated to demonstrate safety and efficacy. Our products and systems
comply with relevant international standards and regulations and are
reviewed and approved by various regulatory bodies. We work closely
and collaboratively with regulatory authorities to ensure our products and
operations meet their expectations and can enter and remain in their market.
We proactively engage with regulators in their efforts to further improve
the timely delivery and access to quality medical devices, such as the
Voluntary Improvement Program and Experiential Learning Program,
organised by the US Food and Drug Administration (FDA).
Clinical collaboration for better outcomes
Clinical studies are an essential element in building confidence in the safety
and efficacy of our products. We support clinical research that validates
improvements in patient outcomes that our products can deliver. In this
context, we work closely with clinicians and healthcare organisations to
support their studies and identify ways in which our products can help
them provide better healthcare solutions.
Fisher & Paykel Healthcare currently supports over 75 active studies. Such
clinical research shows the impact of industry and healthcare providers
working together to improve patient care and outcomes.
Voluntary limited recall of Airvo 2 and
myAirvo 2 devices
In March 2024 we initiated a voluntary limited recall of Airvo 2 and
myAirvo 2 devices manufactured before 14 August 2017. The recall related
to a speaker configuration issue that may result in distorted, intermittent
or inaudible alarm sound levels.
The issue does not affect the therapy delivered by the Airvo 2 or myAirvo
2 device and the devices will otherwise perform as intended; however,
if the device is not monitored, and there is an interruption to therapy, a
patient may experience oxygen desaturation.
We consulted with the various international regulatory authorities to
initiate appropriate action in each country where Airvo 2 and myAirvo
2 devices were in use. We contacted distributors, dealers and hospitals
with products subject to the recall and are replacing the affected devices
returned to us at no charge to customers.
62Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Risk management
Business risk management
framework
The objective of our risk management process is to identify, assess,
rank and inform decisions to manage uncertainty, both positive and
negative. This is achieved with processes and tools that support high-
quality decision-making in complex and uncertain situations.
Our business risk management framework is focused on deriving
competitive advantage through making better judgements and
supporting decision-making in unpredictable environments.
This framework helps to ensure we:
• resolve internally identified risks in compliance with laws and
regulations
• plan, make decisions and prioritise opportunities and threats to
strategic objectives and new product introductions
• respond in a prompt, efficient and effective manner to future
events that create uncertainty or pose a significant risk.
The risk management processes that support this framework are
designed to reflect the dynamics of our business. They begin broadly
with an analysis of the operating environment and then narrow to focus
on strategy, followed by project execution, and lastly specific decisions.
Risk analysis
We carry out risk analysis to support material business decisions.
We involve the relevant stakeholders in these evaluations and
communicate the findings to key decision-makers and management.
When making a decision, carrying out a business activity or approving
an initiative, we apply a range of quantitative risk management
techniques to measure and effectively manage uncertainty.
Business continuity planning
Over the past several years, we have increased our focus on business
continuity planning. Our goal is to anticipate and plan for potential crises
that may cause a significant disruption to our business and subsequently
impact patients, customers, products and shareholders.
We conduct simulations regularly to provide confidence that our
framework is tested, embedded and continuously improved. During the
2024 financial year, we conducted a three-day business continuity planning
simulation, which involved a range of teams across our New Zealand and
Australian businesses and focused on maintaining supply of product
following a disruptive event.
International Standards
The chart below identifies the international standards that guide us
in three key areas.
Risk typeISO standard
Business risks31000 – Risk Management Principles and
Guidelines
Product risks14971 – Medical Devices Application of Risk
Management, specific to medical device design
and manufacturing
Health and safety risks45001 – Health and Safety, with greater emphasis
on managing Critical Risks
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Section 3 | OPERATING SUSTAINABLY | Risk management
Material business risks and strategies to mitigate
After completing our risk management processes, as well as the materiality assessment described in the Company section of this report on pages 22-23,
we have identified key areas of risk for our business and strategies to mitigate them.
AreaDescriptionStrategies to mitigate
Product quality and
patient safety
Patients are harmed as a result of using our
products. This may result in product recalls and
potentially product liability litigation
We operate a worldwide quality management system related to the design, testing and
manufacture of our products. Furthermore, we foster an organisational attitude of product safety
and continuous improvement.
Health and safety Work-related injuries or illnessesOur global health, safety and wellbeing standards are aligned with ISO 45001, with greater
emphasis on managing critical risks.
We design and implement preventative and recovery risk controls for critical health and safety
risks across our global business.
We report our health and safety performance regularly to the Board of Directors and to the
Quality, Safety & Regulatory Committee three times a year.
Market accessMaintaining regulatory compliance is required to
market and sell our products in certain countries
We have a regulatory affairs process that enables us to obtain and maintain product licenses,
as well as a quality management system that ensures compliance with applicable regulatory
requirements. We have monitoring steps in place to evaluate the effectiveness of our
programmes, and our executive management team conducts regular management reviews.
Intellectual propertyThird parties asserting IP rights against usWe have a comprehensive patent portfolio across our technologies, and we actively and robustly
manage IP litigation risk. As part of our product development phase, we conduct freedom-to-
operate searches during product design. We monitor competitor patent filings and take action as
required.
Sustainable profitable
growth
Foreign exchange lossesCurrency risk is hedged in accordance with the Board-approved hedging procedure. The hedging
procedure aims to reduce the impact of short-term currency fluctuations on our cash flow.
We use derivative financial instruments to hedge exposures in the current and future years.
A diversity of currency exposures also provides some natural hedge.
Business continuityContinuity and quality of supplyWe actively monitor our end-to-end processes and systems through an internal risk management
process and implement actions to prevent disruption. We use a business impact analysis to
identify, understand and quantify the impact of a material disruption to a key facility, location,
supplier or business process. This approach enables us to prioritise the most significant potential
exposures to the business. It is also aligned with our crisis planning framework.
Cyber security and data
protection
Cyber security attack resulting in disruption
to operations and data breach
To manage our risk and protect the data entrusted to us, we are constantly reviewing and honing
our risk analysis and control mechanisms to ensure our protections can proactively respond to
developing cyber threats. We continue to use independent reviews to test and identify potential
risks to ensure we focus on the right cyber risks.
For climate-related risks, please refer to our Climate-related Disclosures on pages 94-114.
64Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Risk management
Governance
We are committed to ensuring that the company
maintains a high standard of corporate governance
and ethical conduct.
In this section we provide a summary of our
corporate governance framework, processes and
practices that guide our business and operations.
Fisher & Paykel Healthcare | ANNUAL REPORT 202465
Section 3 | OPERATING SUSTAINABLY | Governance
Corporate governance
overview
The Board and management of Fisher & Paykel
Healthcare are committed to ensuring that
the company maintains a high standard of
corporate governance and ethical conduct.
The Board regularly reviews and assesses the
company’s governance policies and procedures
to ensure that they provide the direction
and controls which enable us to achieve
sustainable, profitable growth and the trust
of our customers, shareholders, regulators,
suppliers and communities.
The company is listed on both the NZX
and the ASX (Foreign Exempt Listing
category). Corporate governance principles
and guidelines apply in both countries. As
at the date of this report, the company
complies with all of the recommendations
of the NZX Corporate Governance Code
dated 1 April 2023. While the company has
Foreign Exempt Listing on the ASX and is not
required to comply with the ASX Corporate
Governance Council’s Corporate Governance
Principles and Recommendations 4th Edition
(ASX Principles), the company considers
its corporate governance practices and
procedures substantially reflect the ASX
Principles. The full content of the company’s
corporate governance policies, practices and
procedures can be found in the corporate
governance section of the company’s website:
https://www.fphcare.com/nz/corporate/
sustainability/governance/.
Ethical standards
As a business we are committed to doing
the right thing. It is important to us from a
social responsibility standpoint and is what
our customers, employees and shareholders
find compelling. We ensure we comply with
our legal and ethical obligations throughout
our business operations, from the way we
source materials, design and manufacture
our products, through to selling our products
across the world.
We have policies and procedures in place to
ensure we conduct our business in a legally,
ethically and socially responsible manner.
These policies and procedures are available
on our website, and summary information
with respect to a number of our policies and
procedures can also be found throughout
this section.
Code of Conduct
We expect our employees and directors
to maintain high ethical standards. A Code
of Conduct for the company sets out these
standards.
The Code covers a range of areas relevant
to legal and ethical behaviour, including
competing fairly, health and safety, data
protection and privacy, working with
customers and suppliers, sanctions compliance,
responsible marketing, financial records and
reporting, continuous disclosure and insider
trading, combating bribery and corruption,
and interactions with healthcare professionals.
It also covers matters such as confidentiality,
conflicts of interest and receipt of gifts.
The Code explains how an employee or
director can report an actual or suspected
breach of the Code. This is also detailed in
our Speak Up (or whistle-blowing/protected
disclosures) Procedure, launched globally in
October 2021, which ensures employees and
contractors know how to report potentially
unethical or illegal behaviour or breaches
of our Code of Conduct, without fear of
retaliation or harassment. Reports can be
made to Speak Up Officers within the company
or to an independent reporting service
managed by Deloitte.
Training on our Code of Conduct is undertaken
by employees globally as part of our induction
process, with refresher training provided
at least once every three years. It has been
translated into a number of different languages
for our local offices and refresher training on
the Code of Conduct was provided for our
employees globally during the 2024 financial
year. The Code of Conduct is available on our
internal intranet and our external website. New
directors are provided a copy of the Code of
Conduct during their induction training.
We have an in-house legal team that provides
advice and assistance to the business globally
on how to comply with our various legal
obligations and engage external legal counsel
to assist us as and when required.
We maintain a schedule for regularly reviewing
and updating corporate governance policies
and charters. The Code of Conduct was last
reviewed and updated in March 2024.
66Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Governance
Anti-bribery and
corruption
In the course of our business, we interact with
a wide range of government officials and private
sector individuals and businesses, including
government regulators, inspection authorities
and healthcare professionals.
We do not tolerate bribery, corruption,
kickbacks or other types of improper benefits,
whether committed by our own people or by
anyone we deal with.
Most of the countries in which we operate
have strict anti-bribery and corruption laws
that apply to our interactions with public
officials. Failing to comply with these laws
could have serious consequences for us, both
as individuals and as an organisation. In some
cases, these consequences could include
criminal charges. We have processes in place
for assessing anti-bribery and corruption
risks and implement measures to mitigate
these risks.
Our Code of Conduct sets out our expectations
for all employees in combating bribery and
corruption. We never offer or accept (or ask
a third party to offer or accept) bribes, illegal
facilitation payments, secret commissions or
kickbacks to or from any person. These rules
apply to all our business activities, including
any interactions we may have with government
officials or with any private person or business,
either locally or overseas.
The Code requires that where we suspect
bribery or corruption, either by our own people
or by any of our suppliers, customers or other
business partners, we report it immediately.
The Speak Up Procedure ensures that all
employees know how to make such a report
and can be confident that concerns will be
taken seriously and investigated and will not
result in retaliation or other harassment. During
the year ended 31 March 2024, the company is
not aware of any instances of corruption or of
incidents in which employees were dismissed
or disciplined for corruption.
Policy influence
We are, from time to time, involved in
discussions with various governmental or
regulatory agencies in relation to existing
or proposed legislation. While we are
members of various trade associations, as
set out on page 167 of this report, we prefer
to engage directly with regulatory bodies
on any legislative matters that may relate
to our business. The company has a policy that
it does not make political donations.
Interactions with
healthcare professionals
As we are a medical device business, we
must comply with laws and regulations on
interacting with healthcare professionals
in various countries around the world. It is
critical that our activities do not improperly
influence the medical decisions of healthcare
professionals or the purchasing decisions of
entities that buy our products.
Our procedure on Interactions with
Healthcare Professionals ensures that we
act ethically and legally in our interactions
with healthcare professionals, comply with all
applicable laws, and do not provide improper
benefits or inducements to healthcare
professionals. We provide training to
employees on this procedure.
Ethical research
and clinical trials
We have formal procedures in place to ensure
that we adhere to the International Conference
on Harmonisation Good Clinical Practice (GCP)
standards during all clinical investigations we
carry out. GCP standards cover the design,
conduct, recruitment, recording and reporting
of clinical investigations that involve the
participation of human subjects.
Our procedures have also been compiled
based on the ISO 14155:2020 standard for:
Clinical investigation of medical devices for
human subjects – Good clinical practice and
the EU Medical Device Regulation.
These procedures are designed to ensure that
the data and reported results of all clinical trials
are credible and accurate and that the rights,
integrity and confidentiality of trial participants
are protected.
Animal research
and testing
We are committed to animal welfare and
believe that animal research and testing should
only be undertaken when there is good reason
to believe the research or testing will enhance
the maintenance or protection of human health.
We apply the principles of Replacement,
Reduction and Refinement to evaluate
whether there is good reason to participate
in or observe animal testing and research.
We sometimes participate in or observe
animal research and testing to assess safety
or biocompatibility and obtain worldwide
regulatory clearances. This includes animal
testing on rabbits, pigs, guinea pigs and mice.
Wherever possible, we look for alternatives
such as in vitro or analytical chemistry testing,
Fisher & Paykel Healthcare | ANNUAL REPORT 202467
Section 3 | OPERATING SUSTAINABLY | Governance
which do not require the use of laboratory
animals. We take great care to ensure there
is no duplicate testing of our products.
In the limited occasions where animal research
and testing is observed or undertaken, we
ensure that any external third party engaged
to carry out animal research or testing has
appropriate animal welfare accreditations
(such as Association for Assessment and
Accreditation of Laboratory Animal Care
International (AAALAC) or the Ministry for
Primary Industries (NZ)) and that all applicable
portions of study protocols are conducted in
accordance with regulations and guidelines
regarding animal care and welfare.
The Board
The Board plays a vital role in overseeing our
strategic direction. Strong governance from a
diverse and experienced Board ensures we can
achieve our aims of improving patient care and
outcomes through inspired and world-leading
healthcare solutions, thereby sustainably
increasing shareholder value.
The biography of each Board member,
including each director’s skills, experience,
expertise and term of office, is set out in the
section, ‘Our Board’.
Role of the Board
The Board is ultimately responsible for our
strategic direction. The specific roles and
responsibilities of the Board, and the Board’s
procedures, are set out in detail in our Board
Charter, available on our website. In summary,
the Board is elected by our shareholders to:
• approve the company’s business strategies
and objectives
• oversee management in its implementation
of the company’s strategic objectives,
instilling of the company’s values and
performance generally
• review and approve budgets and business
plans
• approve our remuneration policy and other
policies and procedures governing the way
we operate our business
• provide governance of internal decision-
making and management.
The Board delegates management of
the day-to-day affairs and responsibilities
of the company to the CEO and executive
management to deliver the strategic
direction and goals approved by the Board.
The specific responsibilities delegated to
executive management are recorded in the
Board Charter.
The Board regularly reviews and assesses our
governance structures, policies and procedures
to ensure these meet all legal requirements and
ensure we maintain the trust of our customers,
suppliers and communities. The Board Charter
was last updated on 28 November 2022.
Nomination and appointment
of directors
The number of directors is determined by
the Board, in accordance with the company’s
constitution. The constitution requires that
there are at least four directors, and no more
than nine directors, and governs the process
for the appointment and removal of directors.
A director is appointed by ordinary resolution
of the shareholders, although the Board may
fill a casual vacancy.
Under the NZX Listing Rules, a director must
not hold office (without re-election) past the
third annual meeting following the director’s
appointment or three years, whichever is
longer. A director appointed by the Board
must not hold office (without re-election)
past the next annual meeting following the
director’s appointment.
When searching for and nominating candidates
to act as a director, the People & Remuneration
Committee takes into account such factors
as it deems appropriate, including diversity
of background (considering factors such
as gender, ethnicity, cultural background,
sexual orientation and age), experience and
qualifications of the candidate, independence
and the Board skills matrix. The Committee
may use external search firms to assist with
locating possible candidates and gathering
relevant information.
When considering the re-election of an
existing director, the People & Remuneration
Committee will also consider the length of
service of the director, and the director’s
performance on the Board to date. It is the
Board’s general expectation that a non-
executive director will hold office for an
aggregate period of approximately nine
years (including re-elections), though
there may be circumstances when it will be
appropriate for directors to have tenures
shorter or longer than this.
We undertake a number of checks before
appointing a director and putting forward
to shareholders a candidate for election
as a director. We ensure shareholders are
provided with all relevant information to
inform their decision on whether to elect or
re-elect a director.
At the annual shareholders’ meeting (ASM)
on 29 August 2023, Pip Greenwood retired by
rotation and, being eligible, offered herself for
re-election and was re-elected to the Board.
68Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Governance
Skills and experience
Scott
St John
Lewis
Gradon
Michael
Daniell*
Pip
Greenwood
Lisa
McIntyre
Graham
McLean
Neville
Mitchell
Cather
Simpson
Financial acumen
✓✓✓✓✓✓✓✓
Sales/Marketing
✓✓✓✓✓✓✓
Engineering/
Science/Technology/
Manufacturing
✓✓✓✓✓✓
Medicine/Medical
Device
✓✓✓✓✓✓
Legal/Regulatory
✓✓✓✓✓
Governance
✓✓✓✓✓✓✓✓
International
Business Experience
✓✓✓✓✓✓✓✓
Tenure (years)8.5822.5*72.50.55.52
* Michael Daniell was appointed as a non-executive director on 1 April 2016 following his retirement as Managing Director and Chief Executive Officer.
Written agreements
with directors
Upon appointment, non-executive directors
are issued a letter setting out the terms and
conditions of their appointment. This includes
information about their role and duties,
time commitments, term of appointment,
remuneration and insurance, access to
information, and disclosure and compliance
obligations. A copy of the standard form of
this letter is available on our website. The
Chief Executive Officer has an employment
agreement setting out his role and conditions
of employment. Further information about
the remuneration of directors is set out in
the ‘Remuneration’ section of this report.
Directors’ and officers’
insurance and indemnity
The Group has arranged, as provided for
under the company’s constitution, policies of
directors’ and officers’ liability insurance which,
with a Deed of Indemnity entered into with all
directors, ensure that generally directors will
incur no monetary loss as a result of actions
undertaken by them as directors. Certain
actions are specifically excluded, for example,
the incurring of penalties and fines which may
be imposed in respect of breaches of the law.
In July 2023, the company announced the
retirement of Donal O’Dwyer and named
Graham McLean as a new addition to
the Board. Graham joined the Board on
1 October 2023 ahead of Donal’s departure
on 31 December 2023.
In March 2024, Board Chair Scott St John
announced his intention to retire from the
Board with effect from the close of the
company’s annual shareholders’ meeting
in August 2024. The Board has elected
current director Neville Mitchell to succeed
Scott as Chair.
More details relating to the nomination and
appointment of directors are outlined in the
Procedure for Selection and Appointment
of Directors available on our website.
Board diversity and skills
A diverse Board allows the company to benefit
from a range of different perspectives, which
leads to healthier debate and decision-making.
As we operate in specialised international
markets, the Board believes that it is important
to have a Board consisting of members with
diverse backgrounds, experience and skills.
The Board has set itself a gender diversity
objective to have not less than 30% of its
directors being male and not less than 30% of
its directors being female. As at 31 March 2024,
37% of the company’s directors are female.
The Board also believes that the tenure
of each of its members is important as it
seeks to balance independent, institutional
knowledge gained through length of service
and the importance of fresh perspectives in
decision-making.
The table above summarises the current key
skills, experience and tenure of the Board.
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Section 3 | OPERATING SUSTAINABLY | Governance
Independence of directors
We are committed to ensuring that a majority
of directors are independent of the company,
and do not have any interests, positions,
associations or relationships which might
interfere, or might be seen to interfere, with
their ability to bring independent judgement
to the issues before the Board.
The Board has regard to a number of factors,
including those described in the NZX
Corporate Governance Code, when assessing
the independence of directors. After
consideration of these factors, the company is
of the view that:
1. Lewis Gradon is a director who is currently
employed in an executive role by the
company
2. Michael Daniell is a director who was
employed in an executive role by the
company until 31 March 2016
3. No non-executive director is currently
deriving, nor has within the last 12 months
derived, a substantial portion of their annual
revenue from the company
4. No director currently holds, nor has held
within the last 12 months, a senior role in a
provider of material professional services to
the company or any of its subsidiaries
5. No director is currently, nor was within the
last three years, employed by the external
auditor to the company or any of its
subsidiaries
6. No director currently has, nor has had
within the last three years, a material
business relationship (such as a supplier or
customer) with the company or any of its
subsidiaries
7. No director is a substantial shareholder of
the company, nor a senior manager of, nor
otherwise associated with, a substantial
shareholder of the company
8. No director has, or has had within the
last three years, a material contractual
relationship with the company or another
Group member other than as a director of
the company
9. No director has close family ties or personal
relationships (including close social or
business connections) with anyone in the
categories listed in point 6
10. Other than Michael Daniell, no director
has held the position of director of the
company for a period of 12 years or more.
Based on these assessments, the Board
considers that, as at 31 March 2024, a majority
(six) of the directors are independent, namely
Scott St John (Board Chair), Pip Greenwood,
Lisa McIntyre, Graham McLean, Neville Mitchell
and Cather Simpson, and that Michael Daniell
and Lewis Gradon are not independent.
Induction and continuing
development of directors
A formal induction programme is provided
to new directors to ensure that they have
a working knowledge of our business. The
programme includes one-on-one meetings
with management and a tour of our R&D
and manufacturing facilities. All directors are
regularly updated on relevant industry and
company issues. From time to time, the Board
may also undertake educational trips to receive
briefings from customers and visit operations
of the company outside of New Zealand. There
is an ongoing programme of presentations to
the Board by all business units.
All directors are members of the Institute of
Directors (or overseas equivalent) and attend
training sessions to remain current on their
duties as directors. The company also arranges
training for directors and management on
specific issues as the need arises.
Board performance
We have a Performance Evaluation Procedure
which relates to the performance of the Board,
the Board Committees and individual directors.
The Performance Evaluation Procedure is
available on our website. The Procedure,
in accordance with the Board Charter,
requires the Board to undertake a two-yearly
performance evaluation of itself that:
• compares the performance of the Board
with the requirements of the Board Charter
• reviews the performance of the Board
Committees and individual directors
• effects any improvements to the Board
Charter deemed necessary or appropriate.
An external consulting company facilitated
the Board’s performance evaluation between
May and August 2022, surveying Board and
executive management on a range of items
including strategy and planning, company
oversight, engagement with management,
stakeholder engagement, board culture,
capability, and succession planning.
Our executive management are also subject to
regular performance and contribution reviews,
which occurred during the 2024 financial
year. The performance and contribution of
senior executives is reviewed regularly through
ongoing discussions with the CEO.
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Section 3 | OPERATING SUSTAINABLY | Governance
Board committees
The Board has three permanent committees
which support the Board by working with
management on relevant issues at a suitably
detailed level and then report back to the
Board. Committees and their members as at
31 March 2024 are:
Audit & Risk Committee
Members: Neville Mitchell (Chair), Scott St
John, Graham McLean, Lisa McIntyre and Pip
Greenwood
All members are independent non-executive
directors.
People & Remuneration Committee
Members: Lisa McIntyre (Chair), Scott St John,
Michael Daniell and Pip Greenwood
All members are non-executive directors,
and three of the four members (including the
Chair) are independent.
Quality, Safety & Regulatory
Committee
Members: Michael Daniell (Chair), Scott St
John, Cather Simpson and Neville Mitchell
All members are non-executive directors, and
three of the four members are independent.
Each Committee has a charter setting out
its objectives, procedures, composition and
responsibilities. A summary is set out below,
and copies of these charters are available on
our website.
The Board may from time-to-time establish
other committees for specific purposes.
About the Audit & Risk Committee
The primary function of the Audit & Risk
Committee is to assist the Board in fulfilling its
responsibilities relating to the company’s risk
management and internal control framework,
the integrity of its financial reporting, and
the company’s internal and external auditing
processes and activities. The Committee also
assists the Board in monitoring and reporting
the company’s strategies, activities and
performance regarding sustainability, corporate
social responsibility and the environment. The
Committee has an annual work plan and reports
to the Board, which enables it to properly
and regularly inform the Board on significant
financial matters relating to the company.
Employees and external auditors are invited
to attend meetings when it is considered
appropriate by the Committee. At least
once per year, the Committee meets with
the auditors without any representatives of
management present and is encouraged to
seek advice from external consultants or
specialists where the Committee considers that
necessary or desirable.
The Audit & Risk Committee closely monitors
financial reporting risks in relation to the
preparation of the financial statements.
The Committee, with the assistance of
management, works to ensure that the
financial statements are founded on a sound
system of risk management and internal
control and that the system is operating
effectively in all material respects in relation to
financial reporting risks. As part of this process,
before the company’s financial statements
are approved, the CEO and CFO are required
to state in writing to the Board that, to the
best of their knowledge, the company’s
financial reports present a true and fair view
of the company’s financial condition and
operational results and are in accordance with
the relevant accounting standards and those
reports are founded on a sound system of risk
management and internal control which is
operating effectively.
About the People & Remuneration
Committee
The People & Remuneration Committee’s
role is to oversee and regulate remuneration
and organisation matters of the company,
including reviewing and monitoring the
company’s human resources strategy for
directors and senior executives, reviewing
remuneration and benefits policies, monitoring
company performance against the Diversity,
Equity & Inclusion Procedure, and reviewing
performance objectives and remuneration of
the company’s Chief Executive Officer and
senior executives. It also seeks advice on and
recommends director remuneration structure
and recommends director appointments and
director succession planning to the Board,
aiming to ensure there is a range of skills,
experience and diversity represented on
the Board.
About the Quality, Safety &
Regulatory Committee
The objective and purpose of the Quality,
Safety & Regulatory Committee is to assist the
Board in fulfilling its responsibilities relating
to the oversight of the company’s quality
management system and health and safety risk
management system. As part of the company’s
internal audit function, regular quality system-
specific internal audit reports are received by
the Committee.
For more details on our internal audit
processes and our quality management
system, refer to page 61 of this report.
Fisher & Paykel Healthcare | ANNUAL REPORT 202471
Section 3 | OPERATING SUSTAINABLY | Governance
Board
Committees
Audit & RiskPeople & RemunerationQuality, Safety & Regulatory
Eligible
to attend
3
Attended
Eligible
to attendAttended
Eligible
to attendAttended
Eligible
to attendAttended
Scott St John88444433
Lewis Gradon88
Michael Daniell
4
88114433
Pip Greenwood884444
Lisa McIntyre884444
Graham McLean
1
4422
Neville Mitchell884433
Donal O’Dwyer
2
664422
Cather Simpson
4
881133
1 Graham McLean joined the Board partway through the financial year in October 2023.
2 Donal O’Dwyer retired from the Board partway through the financial year in December 2023.
3 The number of Board meetings listed above does not include unscheduled Board conference calls which were held throughout the year.
4 Michael Daniell and Cather Simpson both attended an additional committee meeting each as an ‘optional’ attendee.
Board and committee meetings
Normally, the Board holds eight formal
meetings a year. One of those meetings is
typically focused on reviewing the company’s
annual business plan and budget, and at a
separate meeting the long-term strategic plan
is considered. The Board also meets with senior
executives to consider matters of strategic
importance. At the company’s ASM held on
29 August 2023, all the then-serving directors
were in attendance.
Committees generally meet three or four
times per year, or as required to carry out
their responsibilities, and report to the Board
following each meeting.
Details of attendance at Board and Committee
meetings during the year ended 31 March 2024
are set out below:
Takeover Protocol
The Board has adopted a Takeover
Protocol to assist the directors and management
with the response to unexpected takeover
activity. The Protocol summarises key aspects of
takeover preparation, and sets out governance,
conflict and communications protocols for
a takeover response. This Protocol provides
that in the event of a takeover offer, the Board
would establish an Independent Takeover
Response Committee to manage its takeover
response obligations.
Company Secretary
The Company Secretary is Raelene Leonard,
General Counsel. The Company Secretary
is responsible for supporting the proper
functioning of the Board and ensuring the
appropriate policies and procedures are followed.
The Company Secretary reports directly to the
Board, through the Chair, on all governance
matters as outlined in the Board Charter.
Disclosure of interests by
directors
Directors’ certificates to cover entries in
the company’s interests register in respect of
remuneration, insurance, indemnities, dealing in
the company’s shares, and other interests have
been disclosed as required by the Companies
Act 1993.
Directors’ shareholdings
Directors held interests in the following ordinary
shares in the company as at 31 March 2024:
NameOwnershipOrdinary Shares
Scott St JohnBeneficial22,569
Lewis Gradon
1
Beneficial578,556
Michael DaniellBeneficial900,168
Pip GreenwoodBeneficial3,800
Lisa McIntyreBeneficial13,455
Neville MitchellBeneficial7,385
Cather SimpsonBeneficial1,250
1 Lewis Gradon also had a beneficial interest in 385,512 options issued under
the company’s share option plans and a beneficial interest in 197,786
performance share rights under the company’s PSR plans.
72Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Governance
Share dealings by directors
In accordance with the Companies Act 1993 and the Financial Markets
Conduct Act 2013, the Board has received disclosures from the directors
named below of acquisitions or dispositions of relevant interests (as
defined in the Financial Markets Conduct Act 2013) in the company
between 1 April 2023 and 31 March 2024, and details of those dealings
were entered in the company’s interests register.
NameTransactionNumber
of shares
Price per share
(NZD unless
otherwise stated)
Date
Scott St JohnPurchase of shares
under DRP
216$23.59617 July 2023
Purchase of shares
under DRP
175$23.075218 December 2023
Lewis GradonGranted 113,177
Options
––12 September 2023
Granted 49,250
PSRs
––12 September 2023
Share issue upon
cancellation of
138,827 Options
30,109$17.210026 September 2023
Sale of shares14,000$21.765927 September 2023
Employee share
scheme offer
96$20.725527 October 2023
Lisa McIntyrePurchase of shares
under DRP
97$23.59617 July 2023
Purchase of shares
under DRP
78$23.075218 December 2023
Purchase of shares3,300AU$22.98629 February 2024
Neville MitchellPurchase of shares
under DRP
70$23.59617 July 2023
Purchase of shares
under DRP
57$23.075218 December 2023
Donal O’DwyerPurchase of shares
under DRP
703$23.59617 July 2023
Purchase of shares
under DRP
568$23.075218 December 2023
General disclosure of interests by directors
In accordance with section 140(2) of the Companies Act 1993, the
directors named below have made a general disclosure of interest by
a general notice disclosed to the Board and entered in the company’s
interests register.
General notices given by directors which remain current as at 31 March
2024 are as follows:
NameEntityRelationship
Scott St JohnANZ Group Board
Fisher & Paykel Healthcare Employee Share
Purchase Trustee Limited
Fonterra Cooperative Group Limited
NEXT Foundation
Director
ANZ Bank New Zealand Limited
Mercury NZ Limited
Chair
Lewis GradonFisher & Paykel Healthcare Employee Share
Purchase Trustee Limited
Other Group entities listed in the ‘Group
structure’ section of this Report
Director
Michael DaniellCochlear Limited
MRCF IIF GP Pty Limited
MRCF Pty Limited
Tait International Limited
Tait Limited
Director
Pip GreenwoodThe a2 Milk Company Limited
Westpac New Zealand Limited
Chair
Lisa McIntyreBaymatob Pty Limited
Nanosonics Limited
Studiosity Pty Limited
University of Sydney
Director
Graham McLeanUniversal Biosensors, Inc.Chair
CleanSpace Holdings LimitedCEO / Director
Suicide Prevention AustraliaTreasurer / Director
Neville MitchellSigma Healthcare Limited
Sonic Healthcare Limited
Director
Fisher & Paykel Healthcare | ANNUAL REPORT 202473
Section 3 | OPERATING SUSTAINABLY | Governance
NameEntityRelationship
Cather SimpsonAdvemto LimitedChair
Dewpoint Innovations Limited
Orbis Diagnostics Limited
SPIE The International Society for Optics
and Photonics
Director
Orbis Diagnostics LimitedCEO
Dodd-Walls Centre for Photonic and
Quantum Technologies
Governance Board
Pacific Channel Fund IIPartner
Academy Executive Committee of the
Royal Society Te Apārangi
International Council of Academies of
Engineering and Technological Sciences
Paihau – Robinson Research Institute
Advisory Board
Member
Luminoma Diagnostics LimitedFounder / Director
Commission 17 of the International Union
of Pure and Applied Physics
Vice-Chair
Reporting and disclosure
We are committed to the promotion of investor confidence by ensuring
that the trading of our shares takes place in an efficient, competitive
and informed market. We believe that evenly balanced disclosure is
fundamental to building shareholder value and earning the trust of
employees, customers, suppliers, communities and shareholders.
Continuous disclosure
Our Market Disclosure Procedure establishes our disclosure procedures
for meeting our continuous disclosure obligations. The Market
Disclosure Procedure is available on our website. This explains the
respective roles of directors, officers and employees in complying with
continuous disclosure obligations, confidentiality of information, external
communications with analysts and shareholders, and responding to
rumours and market speculation.
The Disclosure Committee, comprising the CEO, CFO, VP – Corporate and
General Counsel, and the Disclosure Officer, being the VP – Corporate
or alternatively the General Counsel, are responsible for administering
compliance with our Market Disclosure Procedure, including continuous
disclosure obligations. Market disclosure requires the approval of either
the Board or the Disclosure Committee, depending on the circumstances.
The Market Disclosure Procedure was last updated on 27 March 2024.
Company policies
We have policies and procedures in place to ensure we conduct our
business with integrity, and in a legally, ethically and socially responsible
manner. Key governance documents including our Board and Committee
Charters, Corporate Governance Policy, Code of Conduct, Diversity,
Equity & Inclusion Procedure, Health & Safety Procedure, Market
Disclosure Procedure, Remuneration Policy (Summary) and Securities
Trading Procedure are all available on our website.
Financial reporting
We are committed to reporting our financial information in an
objective, balanced and clear manner. Financial results are reported in
this annual report in accordance with the New Zealand equivalent of
International Financial Reporting Standards. This annual report includes
detailed financial commentary and notes to the financial statements
which explain any changes to financial reporting.
74Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Governance
This annual report also includes comments from the Chair and CEO on
strategic progress, performance during the year and progress towards
our strategic objectives. It explains how we deliver value for shareholders
and how key performance indicators, such as revenue, profit, constant
currency information, dividend growth and gearing, are used to link
results to our strategy.
We ensure that financial information reported in investor presentations,
company overviews and other documents is portrayed in an accurate, fair
and understandable format.
Other reporting
We are committed to transparent reporting of non-financial objectives,
such as environmental, social and governance (ESG) factors, as well
as risk, health and safety, and business strategy. Our annual report
references the guidelines and principles set out by the Global Reporting
Initiative (GRI) and includes a GRI referenced content index which can
be found at the end of this report. This report also contains our Climate-
related Disclosures in accordance with the External Reporting Board’s
Aotearoa New Zealand Climate Standards, which can be found on
pages 94-114.
Shareholder and
company information
The company has in place an investor relations programme to
facilitate effective two-way communication with investors. We aim to
build strong relationships with our shareholders and investors based on
integrity, transparency and trust. Our intention is to provide shareholders
with all relevant information about the company to enable them to
actively engage with us and exercise their rights as shareholders in an
informed manner.
Shareholder communications
Our Shareholder Communications Procedure facilitates communication
with shareholders through written and electronic means, and by
facilitating shareholder access to directors, executive management and
our auditors. A copy of our Shareholder Communications Procedure is
available on our website.
We communicate with shareholders through the following channels:
• investor section of our website
• annual report
• interim report
• annual shareholders’ meeting (ASM)
• webcasts
• regular disclosures on company performance and news
• disclosure of presentations provided to analysts and investors during
regular briefings, meetings and roadshows.
Our website
Our website is frequently the first port of call for shareholders and
is therefore a core component of our Shareholder Communications
Procedure. We include on our website a range of information relevant to
shareholders and others concerning the operation of the company.
We make available a webcast of our ASM and management presentations
of financial results. Webcast details will be published on the NZX and ASX
before the event so that shareholders and other interested parties may
participate.
We encourage shareholders to receive their shareholder communications
electronically to help reduce our environmental footprint and costs.
Direct communication
Shareholders may, at any time, direct questions or requests for
information to directors or management through our website or by
contacting the relevant officer in charge of investor relations. These
contact details are available on our website.
We have a modern communication framework in place so shareholders
can receive communications in a manner that best suits them. We
provide shareholders with the option to receive communications from,
and send communications to, us and our share registrar electronically.
We offer shareholders the ability to attend our ASM in person or digitally,
including the option to ask questions through a virtual tool, and to vote
electronically or using an app.
Fisher & Paykel Healthcarefi|fiANNUAL REPORT 202475
Section 3 | OPERATING SUSTAINABLY | Governance
ASM and shareholder voting
Our next ASM will be held online at www.virtualmeeting.co.nz/FPH24 and
in person at our East Tāmaki campus in the Daniell Building, 15 Maurice
Paykel Place, East Tāmaki, Auckland, New Zealand on Wednesday,
28 August 2024 commencing at 2.00pm (NZST).
Notice of the ASM will be released to the NZX and ASX and posted on
our website, along with a meeting guide, at least 20 working days prior
to the meeting. We encourage active participation by shareholders at the
ASM, and shareholders may present questions to engage with the Board
and executive management.
Shareholders have the right to vote on major decisions which may change
the nature of the company. Each shareholder has one vote per ordinary
share they own in the company, equally with other shareholders, and may
vote at a meeting in person, or by proxy, representative or attorney. We
offer an electronic voting facility to allow shareholders to vote ahead of
the meeting without having to attend or appoint a proxy.
Share information
Stock exchange listing requirements
The company’s shares were listed on the NZX Main Board on 14
November 2001 and on the ASX on 21 November 2001. On 20 June 2016
the company changed its admission category to an ASX Foreign Exempt
Listing. As part of this change, the company is still required to comply
with the NZX Listing Rules but is not required to comply with many of
the ASX Listing Rules. For the purposes of ASX Listing Rule 1.15.3, the
company confirms that it continues to comply with the NZX Listing Rules.
For the purposes of NZX Listing Rule 3.7.1(h), the company confirms
that there has been no public exercise of powers by the NZX under NZX
Listing Rule 9.9.3.
Current on-market share buy-back
There is no current on-market buy-back of the company’s ordinary
shares. During the year ended 31 March 2024, none of the company’s
ordinary shares were purchased on-market under or for the purposes of
an employee incentive scheme or to satisfy the entitlements of holders
of options or other rights to acquire ordinary shares granted under an
employee incentive scheme. The company does not have any restricted
securities or securities subject to voluntary escrow on issue.
Dividend reinvestment plan (DRP)
The company has continued its DRP under which eligible shareholders
in New Zealand, Australia and the United Kingdom can elect to reinvest
all or part of their cash dividends in additional shares free of brokerage
charges, with an applicable 3% discount. The DRP is available to assist
in reducing the additional debt financing required for the company’s
capital expenditure programme, including the acquisition of land for
the second campus in Karaka. Shareholders wishing to commence
participating in the DRP need to make a participation election by
visiting investorcentre.linkgroup.nz. A copy of the offer document is
available at https://www.fphcare.com/nz/corporate/investor/dividends/
dividend-reinvestment-plan/.
Incorporation and limitations on the acquisition of shares
The company is incorporated in New Zealand and is not subject to
Chapters 6, 6A, 6B and 6C of the Australian Corporations Act 2001. In
general, securities in the company are freely transferable and the only
significant restrictions or limitations in relation to the acquisition of
securities are those imposed by the New Zealand Takeovers Code, the
Overseas Investment Act 2005 (NZ), the Commerce Act 1986 (NZ) and
the Companies Act 1993 (NZ). The company does not impose additional
ownership restrictions.
Credit rating
The company does not currently have an external credit rating status.
Current NZX waivers
During the six months to September 2023, the company relied upon a
waiver from NZX Main Board Listing Rule 3.13.1 granted on 6 August 2019,
allowing the company to aggregate issues of company shares under the
company’s employee share plans over a 10-business day period for the
purposes of market notifications. The company relied on this waiver in
respect of the issue of company shares under its share option plans, its
performance share rights (PSR) plans, its employee share rights (ESR)
plan and its share purchase plans.
The company ceased to rely on this waiver from October 2023, following
the establishment of the Fisher & Paykel Healthcare Corporation
Employee Share Trust. The trust was established to hold shares in the
company which may be allocated to employees of the company and its
subsidiaries who are entitled to receive shares under the company’s share
option plans, and PSR and ESR plans.
76Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Governance
Distribution of shareholders and holdings
The company only has one class of shares on issue, ordinary shares,
each conferring to the registered holder the right to one vote on any
resolution, and these shares are listed on the NZX and ASX. There are no
other classes of equity security currently on issue. The total number of
ordinary shares on issue as at 31 March 2024 was 583,963,682 shares.
The distribution of shareholdings as at 31 March 2024 was as shown in the
table below:
Size of shareholding
Number
of holders%
Number of
ordinary shares%
1 to 1,00015,15657.74%5,067,9120.87%
1,001 to 5,0008,29431.60%19,295,3393.30%
5,001 to 10,0001,6546.30%11,738,5952.01%
10,001 to 50,0009953.79%18,240,5293.12%
50,001 to 100,000630.24%4,440,5120.76%
100,001 and over850.32%525,180,79589.93%
Total26,247100.00%583,963,682100.00%
The employee share options, rights and PSRs on issue to employees are
disclosed in Note 18 of the Financial Statements. There are no voting
rights attaching to share options, rights or PSRs.
Substantial product holders
According to company records and notices given under the Financial
Markets Conduct Act 2013, the substantial product holders in ordinary
shares (being the only class of quoted voting products) of the company
as at 31 March 2024 were as follows:
Substantial Product HolderDate of notice
Number of
ordinary shares
held as at date
of notice
Holding as a %
of total ordinary
shares on issue as
at 31 March 2024
Mitsubishi UFJ Financial group,
Inc. and related bodies corporate
5 Sep 2348,116,6488.2%
BlackRock, Inc. and related bodies
corporate
13 Jul 2137,908,0166.5%
Pinnacle Investment Management
Group Limited and its subsidiaries
13 Oct 2336,059,2066.2%
Hyperion Asset Management
Limited
12 Oct 2335,452,4666.1%
Principal shareholders
The names and holdings of the 20 largest registered shareholders in the
company as at 31 March 2024 were:
Investor NameTotal Units
% Issued
Capital
HSBC Nominees (New Zealand) Limited R601127393
83,534,220 14.30%
HSBC Nominees (New Zealand) Limited R60112738551,836,973 8.88%
JPMorgan Nominees Australia Pty Limited48,653,179 8.33%
HSBC Custody Nominees (Australia) Limited48,028,803 8.22%
JPMorgan Chase Bank38,408,220 6.58%
BNP Paribas Nominees NZ Limited 33,584,164 5.75%
Citicorp Nominees Pty Limited28,309,187 4.85%
Citibank Nominees (NZ) Ltd28,202,203 4.83%
Custodial Services Limited20,719,852 3.55%
Tea Custodians Limited19,546,919 3.35%
New Zealand Superannuation Fund Nominees Limited16,302,952 2.79%
Accident Compensation Corporation9,671,894 1.66%
Premier Nominees Limited7,427,317 1.27%
National Nominees Limited7,257,801 1.24%
FNZ Custodians Limited7,171,404 1.23%
New Zealand Depository Nominee6,377,776 1.09%
JBWere (NZ) Nominees Limited5,500,973 0.94%
Public Trust5,287,041 0.91%
Pt Booster Investments Nominees Limited4,157,341 0.71%
New Zealand Permanent Trustees Limited4,099,423 0.7%
Fisher & Paykel Healthcare | ANNUAL REPORT 202477
Section 3 | OPERATING SUSTAINABLY | Governance
Other Group information
Principal activities
The company is a world-leading designer, manufacturer and marketer
of products and systems for use in acute and chronic respiratory care,
surgery and the treatment of obstructive sleep apnea. There were no
significant changes to the state of affairs of the company or to the nature
of the company’s (or its subsidiaries’) principal activities during the year
ended 31 March 2024.
Use of company information
We did not receive any notices from directors requesting to use company
information received in their capacity as directors which would not
otherwise have been available to them.
Donations
Please refer to Note 5 of the Financial Statements for the Group’s
donations in the financial year to 31 March 2024.
Entries recorded in the interests register
Except for disclosures made elsewhere in this report, there have been no
entries in the company’s interests register made during the year ended 31
March 2024.
Other subsidiary company information
No entries were made in the interests register of any subsidiary during
the year ended 31 March 2024.
No employee of the Group who is appointed as a director of a Group
entity receives or retains any remuneration or other benefits in his or her
capacity as a director. The remuneration and other benefits of Group
employees and former employees totalling $100,000 or more during
the year ended 31 March 2024 are included in the relevant bands for
remuneration disclosed in the ‘Remuneration’ section of this report.
During the year ended 31 March 2024, all directors of subsidiaries were
full-time employees of the Group, with the exception of:
1. Scott St John who is a director of Fisher & Paykel Healthcare
Employee Share Purchase Trustee Limited
2. Lawrence Gibbons who is a director of Fisher & Paykel Healthcare
S.A. de C.V. (Mexico)
3. Toh Han Nee who is a director of Highbrook Insurance Company Pte.
Limited (Singapore)
4. Basyirah Anuar who is a director of Fisher & Paykel Healthcare
Malaysia Sdn. Bhd. (Malaysia)
5. Muhammad Irawan who is a director of PT Fisher and Paykel
Healthcare Indonesia (Indonesia).
Scott St John and Lawrence Gibbons do not receive any remuneration
or other benefits for their roles as directors of the above subsidiaries.
Toh Han Nee, Basyirah Anuar and Muhammad Irawan also do not receive
any remuneration personally for their respective roles as directors as
described above; however, a management fee is paid to their respective
employers (Marsh Singapore Ltd, Zico Corporate Services Sdn. Bhd and
PT TMF Indonesia).
78Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Governance
Group structure
All subsidiary companies in the Group are ultimately 100% owned by
the company. The Group structure and the persons who held office as
directors of subsidiary companies at 31 March 2024 are detailed below.
Entities Directors
Fisher & Paykel Healthcare Corporation Limited* owns:
Fisher & Paykel Healthcare Limited* (NZ)Lewis Gradon, Paul Shearer, Andrew Somervell
Fisher & Paykel Healthcare Treasury Limited*
(NZ)
Lewis Gradon, Paul Shearer, Andrew Somervell
Fisher & Paykel Healthcare Employee Share
Purchase Trustee Limited (NZ)
Scott St John, Lewis Gradon
Fisher & Paykel Asia Limited (NZ)Lewis Gradon, Paul Shearer, Andrew Somervell
Fisher & Paykel Healthcare Americas
Investments Limited (NZ)
Lewis Gradon, Paul Shearer, Andrew Somervell
Fisher & Paykel Healthcare Pty. Limited
(Australia)
Lewis Gradon, Paul Shearer, David Boyle,
Graham Gourd
Fisher & Paykel Healthcare Limited (UK)Lewis Gradon, Paul Shearer, Samuel Frame,
Patrick McSweeny
Fisher & Paykel Holdings, Inc. (USA)Lewis Gradon, Paul Shearer, Andrew Somervell
Fisher & Paykel do Brasil Ltda (Brazil)Brazilian law does not require directors.
Decision making authority lies with the directors
of its shareholders.
Fisher & Paykel Healthcare (Guangzhou)
Limited (China)
Lewis Gradon, Paul Shearer, David Boyle,
Zhiping Hou
Fisher & Paykel Healthcare Limited (Canada)Lewis Gradon, Paul Shearer, Justin Callahan
Highbrook Insurance Company Pte. Ltd.
(Singapore)
Lyndal York, Grant Gillingham, Toh Han Nee
Fisher & Paykel Healthcare MEA Limited
(NZ)
Lewis Gradon, Paul Shearer, Andrew Somervell
Fisher & Paykel Healthcare Limited* (NZ) owns:
Fisher & Paykel Healthcare Properties
Limited* (NZ)
Lewis Gradon, Paul Shearer, Andrew Somervell
Fisher & Paykel Healthcare Asia Limited (NZ) owns:
Fisher & Paykel Healthcare Asia Investments
Limited (NZ)
Lewis Gradon, Paul Shearer, Andrew Somervell
Fisher & Paykel Healthcare Malaysia Sdn.
Bhd.
Lewis Gradon, Paul Shearer, Bryan Peterson,
Basyirah Anuar
Entities Directors
Fisher & Paykel Healthcare Asia Investments Limited (NZ) owns:
Fisher & Paykel Healthcare India Private
Limited
Paul Shearer, David Boyle, Prashant Kate, James
Tuck
Fisher & Paykel Healthcare K.K. (Japan)Lewis Gradon, Paul Shearer, Bryan Peterson
Fisher & Paykel Healthcare Limited (Hong
Kong)
Lewis Gradon, Paul Shearer, David Boyle,
Zhiping Hou
Fisher & Paykel Healthcare Supply Chain
Limited (Hong Kong)
Jonathan Rhodes
Fisher & Paykel Healthcare Colombo
(Private) Limited (Sri Lanka)
Lewis Gradon, Paul Shearer, David Boyle
Fisher & Paykel Healthcare Bangladesh
Limited
James Tuck, Paul Shearer, David Boyle
PT Fisher and Paykel Healthcare IndonesiaLewis Gradon, Paul Shearer, Bryan Peterson,
Muhammad Irawan
Fisher & Paykel Healthcare Medical Device
(Guangzhou) Co., Ltd (China)
Lewis Gradon, Andrew Somervell, Deshitha
Edirisuriya
Fisher & Paykel Healthcare Americas Investments Limited (NZ) owns:
Fisher & Paykel Healthcare S.A. de C.V.
(Mexico)
Lewis Gradon, Andrew Somervell, Lawrence
Gibbons
Fisher & Paykel Healthcare Colombia S.A.S. Legal Representatives: Bryan Peterson, James
Tuck
Fisher & Paykel Healthcare Mexico S.A. de
C .V.
Lewis Gradon, Paul Shearer, Bryan Peterson
Fisher & Paykel Healthcare Properties S.A.
de C.V. (Mexico)
Lewis Gradon, Andrew Somervell, Jonathan
Rhodes
Fisher & Paykel Healthcare Chile SpA No directors. Bryan Peterson and James
Tuck are delegates for the shareholder of the
Company (with the power to act individually).
Fisher & Paykel Healthcare Peru S.A.C.Lewis Gradon, Paul Shearer, Bryan Peterson
Fisher & Paykel Healthcare Costa Rica, S.R.L.Lewis Gradon, Paul Shearer, Bryan Peterson
Fisher & Paykel Healthcare Limited (UK) owns:
Fisher & Paykel Healthcare SAS (France)Lewis Gradon, Paul Shearer, Patrick McSweeny,
Philippe Berardi
Fisher & Paykel Healthcare GmbH (Germany)Philippe Berardi, Patrick McSweeny
Fisher & Paykel Healthcare | ANNUAL REPORT 202479
Section 3 | OPERATING SUSTAINABLY | Governance
Entities Directors
Fisher & Paykel Healthcare AB (Sweden)Lewis Gradon, Paul Shearer, Patrick McSweeny,
Philippe Berardi
Fisher Paykel Sağlık Ürünleri Ticaret Limited
Şirketi (Turkey)
Lewis Gradon, Paul Shearer, Patrick McSweeny
Limited Liability Company Fisher & Paykel
Healthcare (Russia)
Lewis Gradon, Paul Shearer, Bryan Peterson,
Anatoly Filippov
Fisher & Paykel Holdings, Inc. (USA) owns:
Fisher & Paykel Healthcare, Inc. (USA)Lewis Gradon, Paul Shearer, Justin Callahan
Fisher & Paykel Healthcare Distribution Inc.
(USA)
Lewis Gradon
Fisher & Paykel Healthcare SAS (France) owns:
Fisher & Paykel Healthcare Romania S.R.L.Lewis Gradon, Paul Shearer, Patrick McSweeny,
Bryan Peterson
Fisher & Paykel Healthcare GmbH (Germany) owns:
Fisher & Paykel Healthcare (Czech Republic)
s.r.o.
Lewis Gradon, Paul Shearer, Bryan Peterson
Fisher & Paykel Healthcare Poland spółka z
ograniczoną odpowiedzialnością
Lewis Gradon, Paul Shearer, Bryan Peterson
Fisher & Paykel Healthcare MEA Limited (NZ) owns:
Fisher & Paykel Healthcare MEA Investments
Limited (NZ)
Lewis Gradon, Paul Shearer, Andrew Somervell
Fisher & Paykel Healthcare MEA Investments Limited (NZ) owns:
Fisher and Paykel Healthcare Tunisia SARLLewis Gradon, Paul Shearer, Bryan Peterson
Fisher & Paykel Healthcare Nigeria LimitedLewis Gradon, Paul Shearer, Bryan Peterson
Fisher & Paykel Healthcare JordanLewis Gradon, Paul Shearer
Fisher & Paykel Healthcare Kenya LimitedLewis Gradon, Paul Shearer, Bryan Peterson
* Companies operating under a Negative Pledge Deed
80Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Governance
Remuneration
Our approach is to attract, reward and retain
high-quality employees who will help us to achieve
our short and long-term strategic objectives.
This depends in large part upon the remuneration
packages we offer.
This section provides an overview of our
remuneration strategy and governance, including
executive and director remuneration.
Fisher & Paykel Healthcare | ANNUAL REPORT 202481
Section 3 | OPERATING SUSTAINABLY | Remuneration
Letter from Lisa McIntyre,
Chair of the People &
Remuneration Committee
At Fisher & Paykel Healthcare, our intention is to have good people who
contribute the most they can over the long term. The fundamentals that
enable us to achieve this include supporting and caring for our people, and
creating a safe, healthy and enjoyable work environment with sustainable
workloads. We are also committed to rewarding our people fairly based
on individual performance and contribution, the size of their role, market
context and the company’s ability to pay.
We operate in a large number of countries, and our remuneration practices
reflect our culture, values and local market conditions. Our employee
remuneration programme consists of a base wage or salary, a discretionary
component providing the potential for an annual profit-sharing payment
based on relevant company performance. In certain countries, additional
benefits may include superannuation, health and life insurance, and
the opportunity to purchase shares and/or receive long-term variable
remuneration in the form of share options, performance share rights or
employee share rights.
Employees receive base remuneration packages that are generally
benchmarked against similar positions in companies of comparable
size and complexity. We use industry remuneration surveys conducted
by external consultants to determine remuneration levels. In general,
remuneration is reviewed annually, and our process supports our intention
to pay our people fairly. The company delivered strong revenue and
operating cashflow performance during the year, which was at or above
the targets set at the beginning of the financial year. As noted previously in
this report, the Airvo 2 and myAirvo 2 recall adversely impacted operating
profit, resulting in achievement of 92% of the target. The Committee did
not exercise any discretion when assessing discretionary annual variable
remuneration (DAVR) and long-term variable remuneration (LTVR)
outcomes in respect of the 2024 financial year.
There were no significant changes to our remuneration arrangements
during the 2024 financial year, with the exception of an increase in the
non-executive director fee pool which was approved by shareholders at
the 2023 Annual Shareholders’ Meeting.
We believe our current remuneration arrangements, which have been
refined over time, are fit-for-purpose and help us to achieve our long-term
objectives. As such, we do not currently envisage any material changes to
our remuneration approach for the 2025 financial year.
Lisa McIntyre
Chair, People & Remuneration Committee
LISA MCINTYRE
Chair, People & Remuneration Committee
82Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Remuneration
Remuneration governance
The People & Remuneration Committee is responsible for reviewing and
recommending to the Board the company’s approach to remuneration.
This includes overseeing and regulating remuneration matters related
to directors, and reviewing executive management in consultation with
the Chief Executive Officer. The majority of the Committee’s members
are independent and members of the executive management team only
attend Committee meetings upon invitation.
More details on the role and composition of the People & Remuneration
Committee is available on page 71 of this report and in the People &
Remuneration Committee charter which is available on the company’s
website. A summary of the company’s Remuneration Policy is also
available on our website.
Executive remuneration
Executive management remuneration packages consist of a combination
of a fixed remuneration package, a discretionary annual variable
remuneration (DAVR) component, a long-term variable remuneration
(LTVR) component, and the company-wide profit-sharing payment
scheme, as described further below. The total remuneration earned by
executive management is set out in Note 18 of the financial statements.
Fixed remuneration
All members of executive management receive a fixed remuneration
component based on the scale and complexity of the role, market
relativities and experience, and performance. This also includes any
KiwiSaver or other superannuation contribution.
Variable remuneration
Executive management receive variable remuneration linked to financial
and strategic performance.
Discretionary Annual Variable
Remuneration (DAVR)
Discretionary annual variable remuneration (DAVR) is designed to
remunerate executive management relative to the company’s financial
performance and non-financial measures which are the annual
implementation of our long-term plan for sustainable profitable growth.
Details of our plan are shown on the right.
Performance
period
Paid annually and aligned with financial year
(1 April 2023 to 31 March 2024)
MeasuresFinancial (80%)
Weighting
Constant currency operating profit 45%
Constant currency revenue25%
Constant currency pre-tax operating cash flow
10%
Non-financial (20%)
Measures relating to the strategic direction of the company and
environmental and social responsibility initiatives. Non-financial measures
are shared across all members of the executive management team as the
measures involve collaboration and commitment.
Performance
hurdle
The trigger for considering whether to exercise discretion to make any
payment is 90% achievement of at least one of the financial measures.
Payment
calculation
method
Meeting 100% of each financial and non-financial measure results in
payment of 100% of the DAVR amount.
Each financial measure is assessed independently. If the achievement of
a financial measure is less than 90%, 0% achievement will be applied for
that measure.
If the achievement of a financial measure is greater than 120%,
120% achievement will be applied for that measure.
The DAVR payment amount is adjusted pro-rata, with each 1% above
or below each financial measure resulting in a 2% increase or decrease
in payment.
Target paymentsUp to 50% of fixed annual remuneration for the CEO/Managing Director.
Maximum
payment
The maximum achievable DAVR which may be awarded is 132% of the
target DAVR at 20% or more over achievement of the financial measures
and achievement of all non-financial measures.
Approval processThe Board (administered through the People & Remuneration Committee)
has the discretion to alter, amend, replace or withdraw the DAVR scheme
at any time without notice (including during a financial year).
The Board also retains the ultimate discretion in assessing and
determining any payments under the scheme. As part of that, the Board
has the right to exercise its discretion not to make any payments or to pay
a reduced amount, regardless of whether the measures have been met.
Termination of
employment
Participants will not be entitled to be considered for a DAVR payment if
they cease to be employed by the Company prior to the end of the DAVR
year and/or in circumstances where they are under notice of termination of
employment when the DAVR award is under consideration or paid.
Should a participant leave the company (i.e. due to death, permanent
disability, redundancy or on medical grounds) before they are due to be
considered for a DAVR award, the Board will have discretion as to whether
to pay any DAVR award.
Fisher & Paykel Healthcare | ANNUAL REPORT 202483
Section 3 | OPERATING SUSTAINABLY | Remuneration
The relative weighting of DAVR measures and the target achieved in 2024 is set out below:
MeasuresWeighting% of Target Achieved
Constant currency operating profit45%
Constant currency revenue25%
Constant currency pre-tax operating cash flow10%
Non-financial measures20%
AchievedNumberMeasure
1Health & safety
1Quality
2Environmental & social responsibility
1Diversity & inclusion
6Long-term sales strategies
2Infrastructure
100% of non-financial measures were achieved for the financial year.
Total
Minimum
90%
Minimum
90%
Minimum
90%
Target
100%
Target
100%
Target
100%
Achieved (92.4%; $294.7M)
Achieved (99.5%; $1.65B)
Achieved (112.5%; $422.6M)
Maximum
120%
Maximum
120%
Maximum
120%
Achieved 98%
Target
100%
Maximum
132%
Key performance summary
84Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Remuneration
Profit-sharing payment
All our employees, including executive management, who have worked
with us for more than six months are eligible to receive a profit-sharing
payment twice per year.
Long Term Variable Remuneration (LTVR)
LTVR components are designed to align executive management with
shareholder interests over the longer term and provide a longer-term
employee retention benefit. The current LTVR plans available to executive
management are described below. Further information on these and
other LTVR plans can be found in the “Long Term Variable Remuneration”
section of our website.
2022 Share Option Plan – Options vest if the company’s share price on
the NZX has exceeded the “escalated price” at the third anniversary of the
grant date. The escalated price is determined by a representative amount
representing the company’s cost of capital.
2022 Performance Share Rights Plan – PSRs fully vest if the company’s
gross total shareholder return (TSR) exceeds the performance of the
Dow Jones US Select Medical Equipment Total Return Index (DJSMDQT)
by 10% or more at the third anniversary of the grant date of the PSRs.
Employee Share Purchase Plan – Executive management can choose
to participate in this Plan up to the value of $2,000 with a discount of
up to $500, with no interest charged on the loans. The qualifying period
between grant and vesting date is three years.
The rules of the Share Option Plan and Performance Share Rights Plan
were amended in 2022 and executives may retain instruments granted
in 2019, 2020 and 2021 under previous versions of the plan rules. Further
information on the previous plan rules can be found in Note 18 of our
financial statements.
Participants in the company’s equity-based remuneration schemes
are not permitted to enter into transactions (whether through the
use of derivatives or otherwise) which limit the economic risk of their
unvested entitlements. For the avoidance of doubt, this does not
prevent participants entering into financial arrangements from being
able to exercise vested entitlements under any company equity-based
remuneration scheme.
Summary of LTVR performance
Performance Share Rights
Met vesting
hurdle in FY24?Comment
2019 PSRs
✗
From 11 September 2019 to 11 September 2023 our TSR
performance did not exceed that of the DJSMDQT, and
PSRs did not meet the vesting hurdle for the second
performance period.
2020 PSRs
✗
From 4 September 2020 to 4 September 2023
our TSR performance did not exceed that of the
DJSMDQT, and PSRs did not meet the vesting hurdle
for the first performance period.
Share Options
Met vesting
hurdle in FY24?Comment
2019 Options
✓
The five-day volume-weighted average price (VWAP)
for the company’s shares over the five trading
days from 4 September to 8 September 2023 was
calculated as $22.06 and exceeded the escalated
share price. The escalated share price was calculated
off a base price of $17.21 at grant, escalated by
the company’s cost of capital over the four-year
performance period.
2020 Options
✗
The five-day VWAP for the company’s shares did not
exceed the escalated price at the third anniversary of
the grant date (4 September 2023) and these options
did not meet the vesting hurdle in FY24.
Fisher & Paykel Healthcare | ANNUAL REPORT 202485
Section 3 | OPERATING SUSTAINABLY | Remuneration
CEO remuneration arrangements and outcomes
Remuneration structure
The CEO remuneration structure is consistent with the executive management remuneration structure described previously.
CEO remuneration summary
YearFixed remunerationDiscretionary annual variable remuneration (DAVR)
2
Long-term variable remuneration (LTVR)Total remuneration
Base salary
(NZD)
Other benefits
1
(NZD)
Earned
(NZD)
Amount earned
as a % of
maximum award
Total cash-based
remuneration
earned (NZD)
Number of
shares issued
upon exercise
Vesting –
% of maximum
3
Market price
upon exercise
(NZD)
Total LTVR
4
(NZD)
Fixed remuneration
+ DAVR earned +
LTVR vested (NZD)
FY241,786,930150,297935,05772%2,872,28430,10951%21.98661,6873,533,971
FY231,709,111428,688424,43430%2,562,233––––2,562,233
1 Other includes superannuation contributions and life insurance. The FY23 total included a one-off entitlement of long-service leave in accordance with company policy that applies to all New Zealand employees.
2 DAVR represents what was earned for the financial year. DAVR value includes the company-wide profit-sharing bonus.
3 Calculated as the number of LTVR instruments that vested and were exercised by the CEO during the relevant performance period, divided by the total number of LTVR instruments held by the CEO that were tested during that performance period.
4 LTVR in the table represents what was earned during the financial year. However, the cost of each LTVR plan is independently measured and accounted for based on the fair value at the date granted. Details of the plans and valuation methodology
are set out in Note 18 to the financial statements.
DAVR achieved in 2024
The DAVR financial targets achieved are set out in the Executive Management section on page 84. During the 2024 financial year, the CEO achieved 98%
of his DAVR target. The DAVR earned in the 2024 financial year is 48% of fixed remuneration.
86Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Remuneration
PSRs granted to the CEO (as at 31 March 2024)
Awarded during the
reporting period
PSRs
lapsed
during the
reporting
period
PSRs vested during the reporting period
Shares issued during the
reporting period
Balance
of PSRs at
31 March
2024Grant name
PSR award
date
Vesting
date
Balance
of PSRs at
31 March
2023
PSRs
awarded
Market
price
at award
PSRs
vested
Market
price
at vesting
date
Vesting
date
Shares
issued
Market
price at
issue
dateIssue date
2023 - PSRs12 Sep 202312 Sep 2026–49,250$21.55–––––––49,250
2022 - PSRs7 Sep 20227 Sep 202556,749–––––––––56,749
2021 - PSRs1 Sep 2021
1 Sep 2024
to 1 Sep 202625,761–––––––––25,761
2020 - PSRs4 Sep 2020
4 Sep 2023
to 4 Sep 202522,178–––––––––22,178
2019 - PSRs11 Sep 2019
11 Sep 2022
to 11 Sep 202443,848–––––––––43,848
Share options granted to the CEO (as at 31 March 2024)
Awarded during the
reporting period
Options
lapsed
during the
reporting
period
Share options vested and exercised during
the reporting period
Shares issued during the
reporting period
Balance of
options
at 31 March
2024Grant name
Options
award date
Vesting
date
Balance of
options at
31 March
2023
Options
awarded
Market
price
at award
Share
options
vested and
exercised
Market
price
at vesting
date
Vesting
date
Shares
issued
Market
price at
issue
dateIssue date
2023 - Options12 Sep 202312 Sep 2026–113,177$21.55–––––––113,177
2022 - Options7 Sep 20227 Sep 2025128,771–––––––––128,771
2021 - Options1 Sep 2021
1 Sep 2024
to 1 Sep 202673,633–––––––––73,633
2020 - Options4 Sep 2020
4 Sep 2023
to 4 Sep 202569,931–––––––––69,931
2019 - Options11 Sep 2019
11 Sep 2022
to 11 Sep 2024138,827–––138,827$21.2411 Sep 202330,109$21.9826 Sep 2023–
Fisher & Paykel Healthcare | ANNUAL REPORT 202487
Section 3 | OPERATING SUSTAINABLY | Remuneration
Severance arrangements
Within a period of two years following a change in control of the
company, and upon either written notice from the CEO or termination
of the CEO’s employment for any reason (excluding serious or repeated
misconduct or demonstrable and prolonged poor performance),
the company will pay to the CEO the sum of one year’s total fixed
remuneration in addition to any other compensation that may be payable
to the CEO pursuant to the terms and conditions of his employment.
Other than in the event of a change of control in the company, there are
no general severance arrangements for the CEO.
ESG disclosures
CEO/worker ratio
The ratio of Chief Executive total remuneration to mean Fisher & Paykel
Healthcare total remuneration is 35:1 (using $100,511 as mean employee
total remuneration and Chief Executive total remuneration for the 2024
financial year).
Gender pay equity
Fisher & Paykel Healthcare has been reporting on gender pay equity
since 2017. Gender pay equity is about making sure people are paid fairly
regardless of their gender. We continue to monitor this on a regular basis
across our global locations. For full details on our like-for-like gender pay
gap and overall gender pay gap, refer to page 44 of this report.
Remuneration bands
The tables opposite show the remuneration (inclusive of the value of
other benefits) totalling $100,000 or more received by employees
or former employees in the 2024 financial year. This includes global
employees, and offshore remuneration amounts have been converted into
New Zealand dollars. This does not include the CEO, who is a director of
the company.
The tables include salary and wages, profit-sharing payment and
discretionary annual variable remuneration (DAVR) paid during the
2024 financial year. They also include the fair value of long-term variable
remuneration (LTVR) as expensed in the period.
Remuneration band
(NZD)
Number of
employees
100,000 – 110,000259
110,001 – 120,000277
120,001 – 130,000231
130,001 – 140,000158
140,001 – 150,000137
150,001 – 160,000133
160,001 – 170,000111
170,001 – 180,00073
180,001 – 190,00068
190,001 – 200,00050
200,001 – 210,00042
210,001 – 220,00048
220,001 – 230,00036
230,001 – 240,00036
240,001 – 250,00027
250,001 – 260,00026
260,001 – 270,00011
270,001 – 280,00017
280,001 – 290,00016
290,001 – 300,00020
300,001 – 310,00018
310,001 – 320,00013
320,001 – 330,00011
330,001 – 340,000 7
340,001 – 350,00011
350,001 – 360,00012
360,001 – 370,000 8
370,001 – 380,000 3
380,001 – 390,000 3
Remuneration band
(NZD)
Number of
employees
390,001 – 400,000 5
410,001 – 420,000 3
420,001 – 430,000 7
430,001 – 440,000 5
440,001 – 450,000 6
450,001 – 460,000 7
460,001 – 470,000 1
480,001 – 490,000 1
490,001 – 500,000 5
500,001 – 510,000 1
520,001 – 530,000 3
550,001 – 560,000 2
580,001 – 590,000 2
620,001 – 630,000 1
640,001 – 650,000 1
670,001 – 680,000 1
700,001 – 710,000 1
740,001 – 750,000 1
750,001 – 760,000 1
760,001 – 770,000 1
770,001 – 780,000 1
810,001 – 820,000 1
830,001 – 840,000 1
870,001 – 880,000 1
1,110,001 – 1,120,000 1
1,120,001 – 1,130,000 1
1,560,001 – 1,570,000 1
1,570,001 – 1,580,000 1
1,620,001 – 1,630,000 1
88Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Remuneration
Non-executive directors’ remuneration
Remuneration strategy
The People & Remuneration Committee is responsible for establishing and
monitoring remuneration policies and guidelines for directors. This enables us
to attract and retain directors who contribute to the successful governing of
the business and create value for shareholders.
We also take advice from independent consultants and take into account fees
paid to directors of comparable companies in New Zealand and Australia as part
of our assessment of the appropriate level of remuneration of directors.
The maximum total monetary sum payable by the company by way of
directors’ fees is $1,750,000 per annum as approved by shareholders at the
Annual Shareholders’ Meeting which was held in August 2023. Independent
remuneration benchmarking was provided by Mercer. A summary of the
report is available on the company’s website at https://www.fphcare.com/nz/
corporate/investor/events/.
Executive directors are not entitled to receive any remuneration solely in their
capacity as directors of the company. Non-executive directors do not take a
portion of their remuneration under an equity security plan; however, directors
may hold shares in the company. Details are set out on page 72 of this
report. It is our policy to encourage directors to acquire shares on-market.
No non-executive director is entitled to receive a retirement payment.
Approved director remuneration
The current non-executive directors’ fees and the fees received
by non-executive directors in the 2024 financial year, including a
breakdown of Board fees and Committee fees, are set out in the
tables below. The fees payable are determined based on the time
commitment and responsibilities of each role.
Fees per annumChair $Member $
Board of Directors324,000144,000
People & Remuneration Committee30,00018,950
Quality, Safety & Regulatory Committee30,00018,950
Audit & Risk Committee37,90018,950
Director remuneration received in the 2024 financial year
Director Board Fees $
People & Remuneration
Committee $
Quality, Safety &
Regulatory Committee $ Audit & Risk Committee $
Overseas Director
Allowance
2
$ Total Remuneration $
Scott St John 308,957––––308,957
Neville Mitchell141,176–18,950 36,683
1
23,935
5
220,744
Pip Greenwood141,17618,950 –18,950 –179,076
Donal O’Dwyer105,17614,213 14,213 –17,935
5
151,537
3
Michael Daniell141,17618,950 28,020
1
– –188,146
Lisa Mclntyre141,17628,711
1
–18,950 23,935
5
212,772
Graham McLean72,000–– 9,475 12,000
5
93,475
4
Cather Simpson141,176– 18,950 – – 160,126
1,192,01380,824 80,133 84,058 77,805 1,514,833
1 Designates Chair of Committee.
2 Directors based outside New Zealand are paid an allowance associated with attendance at Board and Committee meetings in a different country or time zone and to reflect local pecuniary practices.
3 Donal O’Dwyer retired from the Board with effect from 31 December 2023.
4 Graham McLean was appointed to the Board with effect from 1 October 2023.
5 Remuneration for Neville Mitchell, Donal O’Dwyer, Lisa McIntyre, and Graham McLean is set in NZD but paid in AUD at the prevailing exchange rate at the date of payment.
During the 2024 financial year, there were no additional fees or benefits earned that do not relate to services as a non-executive director. In addition,
non-executive directors were not issued shares or LTVR instruments as part of their remuneration during the financial year.
Fisher & Paykel Healthcare | ANNUAL REPORT 202489
Section 3 | OPERATING SUSTAINABLY | Remuneration
Environment
Our intention is to create a positive lasting
impact on society and the environment.
This starts with doing what is best for the
patient and guides our decision-making
approach. We understand that in the course
of improving patient outcomes, we also have
a responsibility to operate our business
efficiently and responsibly.
We recognise the overall importance of
biodiversity, water and forests and other
natural ecosystems. In addition to measuring
carbon emissions (as reported in our
Climate-related Disclosures on pages 94-114),
we also track other key environmental metrics,
including waste management, recycling and
water usage. This section outlines some of
our environmental commitments and
initiatives for measuring and improving
our environmental performance.
90Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Environment
Environmental commitments
During the 2024 financial year,
Fisher & Paykel Healthcare
organised the planting of native
trees and shrubs at the new
Karaka site in New Zealand, with
help from employees and their
children. The planting will help to
improve biodiversity of the site
and to make the waterway clean
and safe from livestock.
Our environmental intentions are outlined
in our Environmental & Social Responsibility
Policy, which has been embedded across our
business and posted publicly on our company
website. We begin with doing what is best
for the patient. While improving care and
outcomes for patients, we seek to innovate
to enable a more sustainable future, verify
and validate our environmental performance,
and comply with the letter and spirit of laws
and regulations relating to environmental
responsibility.
Environmental sustainability is integrated
into our environmental management system,
which is externally audited each year to the
ISO 14001 international standard. We follow
formal environmental management processes
to review and monitor environmental
sustainability issues and risks, and these
processes are embedded into our enterprise
risk management systems.
The Fisher & Paykel Healthcare Board of
directors, under the guidance of the Audit &
Risk Committee, is responsible for providing
overall governance and oversight of the
company’s environmental practices, including
its approach to biodiversity, forests and water.
Our procedures for biodiversity, forests and
water are publicly available on our company
website and described briefly below.
Biodiversity
Our biodiversity intentions are set out in our
Ecosystems: Biodiversity Procedure. They
include identifying pathways to achieve a net
positive impact on biodiversity, minimising
the conversion of natural ecosystems, and
promoting restoration and maintenance of
natural ecosystems in our direct operations.
We also engage with local stakeholders
where we have large facilities, educating our
people about biodiversity and developing our
disclosures to outline how we assess biodiversity
risks and opportunities.
Forests
We recognise the overall importance of forests
and other natural ecosystems to our business.
Our intentions include reducing deforestation,
minimising the conversion of natural ecosystems,
and promoting restoration and maintenance
of natural ecosystems in our direct operations.
We support responsible forest management,
both environmentally and socially, by adopting
traceability standards for the forest commodities
we use in our operations.
We promote sustainable sourcing and
consumption of forest risk commodities through
eco-efficiency and support for a transition to
a paperless society. We also use wood fibre
products approved by the Forest Stewardship
Council for our shipping boxes. In the course
of doing business, we document and monitor
potential business impacts on forests and other
natural ecosystems. Furthermore, we engage
stakeholders and create awareness of forest
risks and opportunities along our value chain.
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Section 3 | OPERATING SUSTAINABLY | Environment
Karaka community
engagement
Water
We recognise the overall importance of water and other natural ecosystems.
We promote water efficiency in all company operations, including the design,
manufacture and distribution of products. In water-scarce regions, we have
assigned specific responsibilities for water efficiency, and we apply good water
stewardship practices, such as rainwater harvesting, closed-loop water systems
and water recycling.
Each year we measure and report metrics on our water usage, so that we can
improve our performance. During FY24, we achieved a 5% reduction in water
used at our Mexico campus, compared to the prior financial year. Of our total
water use, our New Zealand campus accounted for 66%, our Mexico campus
accounted for 30%, and our global sales offices accounted for 4%.
WaterFY2022FY2023FY2024
Water usage (cubic metres)184,171133,517136,923
Recycling
We maintain robust recycling programmes at our large facilities in New Zealand
and Mexico to reduce waste. Each year we measure and report metrics on waste
diverted from landfills and the efficiency of our recycling programmes.
Waste and recyclingFY2022FY2023FY2024
Landfill waste diverted (cubic metres)2,0351,7271,348
NZ recycling efficiency
(% waste diverted from landfill)
68%62%59%
Global recycling efficiency
(% waste diverted from landfill)
52%54%53%
CDP
*
scores
We report on key performance metrics and disclose our ratings in CDP’s
Climate, Supplier Engagement (which is a subset of Climate), Water and Forests
programmes. Below are our CDP ratings for the last three financial years.
CDP ProgrammeFY2022FY2023FY2024
ClimateBA-B
– Supplier Engagement on ClimateABB-
WaterBCB
ForestsCCC
* Formerly known as the Carbon Disclosure Project
During the 2024 financial year, our focus was on
building partnerships with tāngata whenua (Māori) and
community stakeholders to help inform the development
of our future Karaka campus in New Zealand.
In line with the Māori value of kaitiakitanga (guardianship
of land), our discussions with local iwi focused on
long-term goals around the environment, water quality,
re-establishment of native species and sustainability
innovations. As we develop the Karaka land over time,
our iwi partners will provide cultural inductions to
increase our knowledge of its history and significance.
To engage residents in the Karaka community,
Fisher & Paykel Healthcare hosted a community
engagement in February 2024. The event, which drew
nearly 100 people, provided a forum for discussing the
development and its environmental impact.
92Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Environment
Ecodesign Advisory Board
Through our Ecodesign Program, more
than 100 product development engineers
across the business are involved in research
into biobased materials and a range of
sustainable design and packaging projects.
We have appointed an external Ecodesign
Advisory Board made up of four
independent subject matter experts to
provide external guidance and support of
environmental sustainability and Ecodesign
initiatives. During the 2024 financial year,
the Board provided guidance on our carbon
reduction long-term plan and mentored key
team members.
Green Team
Our volunteer-led Green Team now
includes hundreds of employees who
remain highly engaged in promoting
environmental sustainability at our
New Zealand campus and in the
community. During the 2024 financial
year, the Green Team organised a
sustainable transport showcase, hosted
the founder of Predator Free Miramar
to speak on biodiversity, and set up a
workshop to repair household items. The
Green Team also celebrated its annual
recognition event, the Green Awards.
Awards went to employees George
Cuttance for commitment to biodiversity,
Kane Finlay for a sustainable packaging
initiative, and Ellis Jarvis for sustainability
advocacy in the UK.
Memberships
Fisher & Paykel Healthcare is a member of
the Sustainable Business Network, which is
New Zealand’s largest and longest-standing
sustainable business organisation. The network
aims to enable change in the areas of climate,
waste and nature.
Andrew Charlesworth and Emily Bradley from Big Street
Bikers and F&P employee Jonathan Sng promote ebike
charging stations at the Sustainable Transport Showcase.
DAVID TRUBRIDGE
Globally renowned
Ecodesign practitioner
DR ELSPETH MACRAE
Leading global
bio-economy expert
DR ANN SMITH
Leading global
carbon expert
DR DAVID GALLER
Leading sustainability
medical practitioner
100+
ENGINEERS involved in research into
biobased materials and sustainable
design projects
Fisher & Paykel Healthcare | ANNUAL REPORT 202493
Section 3 | OPERATING SUSTAINABLY | Environment
Climate-related
Disclosures
As part of our commitment to creating a positive
lasting impact on society and the environment,
we recognise the need to mitigate and adapt to
a changing climate both now and in the decades
to come. Embedded into our global Environmental
& Social Responsibility Policy is our commitment
to innovate to enable a more sustainable future,
and the knowledge that our actions today impact
future generations.
These climate-related disclosures are representative
of a large body of work occurring across the
business to identify, consider and assess climate-
related risks and opportunities, and integrate them
within our broader risk management framework
and strategic business planning. We see the
disclosure process as an iterative one, whereby
we commit to improving our breadth and depth
of detail over future reporting periods.
94Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
About our climate-related disclosures
Fisher & Paykel Healthcare Corporation Limited is a climate-reporting
entity under the Financial Markets Conduct Act 2013. While we have
been measuring our greenhouse gas emissions since 2012 and have
been reporting against the Task Force on Climate-related Financial
Disclosures (TCFD) in our annual reports since 2020, this is our first set
of climate-related disclosures under the External Reporting Board’s (XRB)
recently issued Aotearoa New Zealand Climate Standards (NZCS). The
disclosures cover the period of 1 April 2023 to 31 March 2024 and include
Fisher & Paykel Healthcare Corporation Limited and its subsidiaries.
These climate-related disclosures continue to integrate the
recommendations of the TCFD and comply with NZCS, applying the
following adoption provisions available under the NZCS in the first year
of reporting:
• Adoption Provision 2: Anticipated Financial Impacts (paragraphs 12-14
of NZCS 2) which provides an exemption in the first NZCS reporting
period from the requirements to disclose the anticipated financial
impacts of climate-related risks and opportunities, a description of
the time horizons over which the anticipated financial impacts could
reasonably be expected to occur, and (if relevant) an explanation as to
why quantitative information cannot be disclosed.
• Adoption Provision 3: Transition Planning (paragraph 15 of NZCS 2),
which provides an exemption in the first NZCS reporting period from
the requirements to disclose the transition plan aspects of an entity’s
strategy, including how its business model and strategy might change
to address its climate-related risks and opportunities, and how the
transition plan aspects of its strategy are aligned with its internal capital
deployment and funding decision-making processes. We have set out
our progress towards developing the transition elements of our strategy
(see page 111).
• Adoption Provision 6: Comparatives for metrics (paragraph 20 of NZCS
2) which provides an exemption in the first reporting period from the
requirement to disclose comparative information for the immediately
preceding two NZCS reporting periods, with the exception of GHG
emission metrics.
• Adoption Provision 7: Analysis of trends (paragraph 22 of NZCS 2)
which provides an exemption in the first reporting period from the
requirement to disclose an analysis of the main trends evident from a
comparison of each metric from previous NZCS reporting periods to the
current reporting period, with the exception of GHG emission metrics.
The principles outlined in these climate-related disclosures should not be
considered a prediction of future financial or non-financial performance.
These statements are subject to a range of known and unknown risks,
uncertainties and assumptions, many of which lie outside of our control.
Our climate scenarios were developed based on current assumptions and
projections using information available at the time of development. There
is inherent uncertainty within each scenario – they are not intended to
provide a complete or accurate forecast of future events. The climate risks
and opportunities identified may not eventuate and, if they do, the actual
impacts and consequences are likely to be significantly different to what is
set out in this report.
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Governance
Board oversight of climate-related
risks and opportunities
The Board is responsible for providing overall governance and oversight
of the company’s environmental and social responsibility practices,
including ultimate responsibility for our strategic direction and
consideration of the risks and opportunities presented by climate change.
The Audit & Risk Committee (ARC) supports the Board in
providing governance oversight of climate-related risks and
opportunities. The ARC reviews the company’s environmental and social
risk management framework and record of performance on these
matters, along with any proposed actions based on the record of
performance. This includes monitoring and overseeing the annual
GHG emissions auditing processes, potential emission reduction
pathways and sustainability targets. The ARC also oversees the
climate-related disclosures programme and recommends the climate-
related disclosures to the Board for approval.
The ARC is briefed on environmental sustainability issues by the
executive management team and the Head of Sustainability &
Environmental Innovation throughout the year. This includes performance
against our environmental management system (which includes climate-
related risks) and progress towards our science-based targets and other
environmental sustainability targets and metrics.
The ARC meets at least four times per year. During the 2024 financial
year, sustainability was added as a standing agenda item to the ARC’s
meetings and the length of the meetings extended, to enable more time
to consider sustainability issues including climate-related matters. The
Board is updated on the ARC’s proceedings following each ARC meeting.
The ARC and the Board consider environmental sustainability
matters, including climate-related risks and opportunities, annually
as part of a Group-wide macro risk analysis. During the 2024 financial
year, this information was supplemented by the Climate Working
Group through the work undertaken as part of the climate-related
disclosures programme.
The Board is also briefed on environmental sustainability issues by the
executive management team throughout the year. The Vice President –
Supply Chain, Facilities & Sustainability reports to the Board each meeting
in relation to sustainability matters, and the General Manager Group Risk
Advisory reports to the Board each meeting in relation to group-wide risk
matters. Additional reporting to the Board is undertaken as required.
Fisher & Paykel Healthcare Board
Responsible for governance and oversight of
environmental and social responsibility practices.
Audit & Risk Committee
Monitors performance and compliance against our environmental and social risk management
framework, including progress to meet sustainability targets.
Executive Management Team
Responsible for identifying, assessing and managing climate-related risks and opportunities.
Accountable for embedding environmental and social responsibility initiatives
within business plans.
Carbon Committee
Provides strategic direction to the business on carbon issues.
Reviews performance and progress towards our environmental sustainability initiatives.
Environmental & Social Responsibility Governance Group
Enables business integration of environmental and social responsibility
workstreams and initiatives.
Ecodesign Advisory Board
Provides external guidance and support on environmental sustainability
and Ecodesign initiatives.
Business Units
Integrates sustainability initiatives into the
business and manages climate-related risks.
Risk Advisory
Facilitates the business to make informed
decisions in relation to climate-related risks.
Climate Working Group
Supports the integration of
climate-related risk and opportunity
analysis within the business.
Sustainability Team
Shapes environmental sustainability
strategy and manages our environmental
management system.
96Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
During the 2024 financial year, management engaged with the Board
and the ARC on the company’s carbon reduction long-term plan and
ecodesign long-term plan. The review of these plans will continue into
2025. Further details are contained on page 111.
Annual business plans for each business unit contain environmental
and social responsibility objectives. In addition, our long-term business
plan which assesses our business model, global operations and strategy
across a 15-year period is considered annually. Climate-related risks and
opportunities are considered as part of our long-term plan, particularly
when considering our global operations and current and future
infrastructure and network design needs. The Board reviews and approves
the individual business plans and the long-term plan on an annual basis.
Directors’ climate capabilities and understanding
The Board draws upon expertise from the executive management team,
the Sustainability team and other subject matter experts within the
business, which informs them on the impacts of climate change as it
affects our business and operations. During the 2024 financial year, the
Board attended our annual Ecodesign Expo, where teams from around the
business showcase how they are embedding sustainability considerations
into the product design process. The Board was taken through the climate-
related disclosures workstream by the Climate Working Group, including
our scenario development and strategy workshops.
The directors also obtain insight and education from external experts
and gain experience through their involvement in other businesses and
industries, and in governance roles on other boards. A number of directors
are members of Chapter Zero, a governance group hosted by the Institute
of Directors. This is the New Zealand chapter of the global Climate
Governance Initiative which was established to support World Economic
Forum’s Climate Governance Principles for boards of directors. Chapter
Zero provides directors with climate awareness and skills, so that they
can bring climate considerations to the fore of boards’ decision-making
processes. Our Board Chair Scott St John is a member of the steering
committee for Chapter Zero.
Further details relating to the Board and the ARC including the Board’s
background, skills and experience can be found in the Governance section
of the annual report from page 68.
Management’s role in assessing and managing
climate-related risks and opportunities
Executive management team
The Board assigns the management of climate-related risks and
opportunities to the executive management team. Members of the
executive team are responsible for implementing the Environmental
& Social Responsibility Policy and for identifying, assessing and
managing climate-related risks and opportunities. Each ARC meeting
is attended by the Chief Executive Officer, Chief Financial Officer, Vice
President – Corporate, General Counsel & Company Secretary and the
General Manager Group Risk Advisory. Other members of the executive
management team and subject matter experts attend as required. The
executive management team also reports to the wider Board for progress
on environmental and social responsibility initiatives. Further details
relating to the executive management team can be found on pages 31-33.
The Carbon Committee serves as a steering group for carbon-related
matters within the business. It is comprised of the Chief Executive Officer,
Chief Financial Officer, Vice President – Corporate, Vice President –
Supply Chain, Facilities & Sustainability, and Vice President – Products &
Technology. The Carbon Committee meets at least once each quarter with
the Sustainability team, providing direction on the company’s emissions
reduction programme, including implementation of sustainability initiatives
aligned with business strategy and long-term planning, in addition to
monitoring progress towards sustainability targets.
Remuneration related to climate-related
risks and opportunities
The executive management team’s remuneration package includes
environmental and social responsibility non-financial measures within the
discretionary annual variable remuneration (DAVR) component. These
non-financial measures have a 20% weighting of the overall DAVR, with
measures shared across all members of the executive team due to their
achievement requiring collaboration and commitment. In the 2024 financial
year, two of the 13 non-financial measures related to environmental and
social responsibility. For further details see the “Executive remuneration”
section of the annual report on pages 83-84.
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Business units
Business units are responsible for day-to-day management of climate-
related risks and implementing sustainability strategies which are
aligned with the Board-approved annual business and long-term plans.
Our Sustainability team shapes our environmental strategy, policy
development and long-term planning, and is responsible for the
performance of our global Environmental Management System
(which includes climate-related risks). The team is led by our Head of
Sustainability and Environmental Innovation who reports to the Vice
President – Supply Chain, Facilities and Sustainability. The team play a
fundamental role in creating awareness, educating and working with
the business on sustainability initiatives, including identifying and
managing risks and opportunities.
Our Risk Advisory team supports the business to make informed
decisions using a range of risk management techniques to identify,
analyse and prioritise uncertainty. The team is led by the General
Manager Risk Advisory who reports to the Chief Financial Officer.
For more detail on the company’s overall approach to risk management,
refer to pages 60-64 of the annual report.
The newly formed Climate Working Group supports the business
to identify, assess and manage climate-related risks and opportunities
through scenario analysis. This working group is responsible
for preparing climate-related disclosures and reports to the
Carbon Committee.
Advisory and governance forums
The Environmental & Social Responsibility (E&SR) Governance
group, comprised of internal stakeholders across the business, is
tasked with establishing a framework to embed the E&SR Policy and
enable business integration of a range of environmental and social
responsibility workstreams and initiatives, including those related
to climate. This group reports into three sponsoring members of
the executive management team: Vice President – Corporate, Vice
President – Supply Chain, Facilities & Sustainability, and Vice President –
Human Resources.
The Ecodesign Advisory Board, consisting of four independent subject
matter experts in their respective fields, provides independent guidance
and support to management in relation to carbon and climate risk,
bioeconomy and sustainable healthcare and ecodesign expertise. More
details on the Ecodesign Advisory Board are available on page 93 of
the annual report.
98Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Risk management
Our process for identifying, assessing and
managing climate-related risks
The purpose of our risk management process is to identify, analyse and
prioritise uncertainty to improve the quality of decisions we make. We
identify and assess climate-related risks as part of our overall sustainability
strategy and risk management framework, both of which are reviewed by
the Board, the ARC and executive management annually. Climate-related
risks have been considered a key area of risk to our business, and we have
prepared voluntary disclosures aligned with the recommendations of the
TCFD as part of the annual report since 2020.
Each year we improve upon the process to identify, assess and manage
climate-related risks and opportunities. Our annual process includes:
• Identifying physical and transitional climate-related risks, as well
as considering the timeframe over which the risks may eventuate.
Consideration of the severity, likelihood, geographical location, and local
impact versus enterprise-wide impact. We review the best available and
updated information and models to assess the possible impacts on our
business throughout the year.
• Documenting, scoring and managing climate-related risks through our
ISO 14001 Environmental Management System process.
• A quantitative risk analysis assessment model is used to assess the size
and impact of identified climate-related risks, in line with our approach
for assessing other risk categories.
• Climate-related risks are then embedded into our group-wide risk
management process, where they are assessed and reviewed by our
Group Risk Advisory team and wider executive management team. We
do not prioritise climate-related risks independently from other material
business risks.
We also rely on input from external stakeholders through our materiality
assessment. This assessment has been updated to specifically include
climate-related business risk as a standalone category. For further details
on the materiality assessment, refer to pages 22-23 of the annual report.
Integration within the wider business
Business units are responsible for:
• day-to-day management of climate-related risks
• identifying metrics to monitor the risks
• identifying actions to mitigate the risks
• implementing sustainability strategies which are aligned with the
Board-approved annual business and long-term plans.
The climate-related identification and assessment processes described
above feed into and inform how we work to mitigate and adapt to
climate change, including through the development of our carbon reduction,
Ecodesign and infrastructure and network design long-term plans.
For further information refer to “Developing a climate-resilient business
model (transition planning)” section of these climate-related disclosures
at page 111.
Scenario analysis
During the 2024 financial year, as part of our climate-related disclosure
programme, we undertook scenario analysis across three climate scenarios.
Given this was the first year of reporting under the NZCS framework, the
scenario analysis was a stand-alone process to identify climate-related risks
and opportunities and did not form part of our existing risk management
processes. We consider the scenario analysis builds on the existing
assessment and represents an evolution of our approach to assessing and
managing climate-related risks and opportunities.
Our climate scenarios are described in the Strategy section of these
climate-related disclosures on pages 104-106.
The core purpose of our scenario analysis was to consider the key
questions of “How could climate change plausibly affect our business
model and strategy?” and “What should we do and when?”.
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
The answers to these questions will inform the incorporation of future,
plausible climate risks and opportunities into our strategic business planning.
The following steps were taken:
1. Climate working group established. To build upon the analysis
performed in prior reporting periods, a climate working group was
formed, comprising of members from the Sustainability, Risk Advisory,
Corporate Affairs and Finance teams. This team developed a climate-
related disclosures programme to enable the business to comply with
the NZCS.
2. Engaging key stakeholders. The Carbon Committee provided oversight
of the climate-related disclosures programme and participated in the
scenario analysis workshops, along with additional senior leaders.
Other subject matter experts from within the business were identified
to input into the analysis.
3. Scenario development.
As a medical device and technology company with an extensive global
footprint (deriving 99% of revenue outside of New Zealand), we did
not consider that there was a suitable sector-wide scenario analysis to
draw upon. The working group developed our own scenarios for the
analysis, taking the following steps:
a. Select climate scenarios. In prior disclosures, we noted we
have assessed risks and opportunities associated with the
Intergovernmental Panel on Climate Change (IPCC) Representative
Concentration Pathways (8.5, 6.0, 2.6 and 1.9). In the IPCC’s Sixth
Assessment Report (AR6) published in 2021, climate projections
had evolved into Shared Socioeconomic Pathways (SSPs). We
chose three Shared Socioeconomic Pathways scenarios as a means
of testing and challenging the resilience of our business model
across a range of plausible climate futures:
i. Our Outpatient scenario reflects emissions reduction and
decarbonisation occurring at a manageable, non-critical state.
It relates to SSP1 which is known as ‘Sustainability – Taking the
Green Road’ or an ‘Orderly, Rapid Transition’. This assumes the
world achieves net zero by 2050 and reaches the stated goal
of the Paris Agreement: a 1.5°C temperature rise above pre-
industrial levels. The global response is coordinated, orderly
and focused on mitigating the impact of climate change. The
Outpatient scenario aligns with the mandated NZCS scenarios
and tests how we would respond in a rapidly decarbonising and
transitioning landscape.
ii. Our Emergency Department scenario reflects emissions
reduction and decarbonisation needing critical attention. It
relates to SSP2 which is known as ‘Middle of the Road’ or
a ‘Disorderly, Delayed Transition’. This assumes net zero is
unattainable by 2050 as emissions persist past current levels.
The world follows a path in which social, economic, and
technological trends do not shift markedly from historical
patterns, resulting in a 2.7°C warming scenario by 2100. The
Emergency Department scenario was selected as we consider
this scenario suitably challenges our business model, given the
effects of variable customer preferences and the impact on
market access.
iii. Our High Dependency Unit scenario reflects a deteriorating
state of the environment and climate. It relates to SSP3 which
is known as ‘Regional Rivalry – a Rocky Road’ or ‘Too Little, Too
Late’. Emissions approximately double from current levels by the
end of the century, resulting in a 3.6°C rise in global temperature.
Global co-operation efforts falter and self-interested actions
prevail. Climate change cannot be mitigated globally and there
is limited ability to adapt. The High Dependency Unit scenario
was selected due to the significant increase in physical impacts
of climate change, and the significant challenges to a global
business given protectionist behaviours and a shift towards
deglobalisation.
b. Define scenarios. Using the three SSPs outlined above, the working
group identified the time horizons, key temperature outcomes
and socio-economic features of each scenario. Relevant ranges of
data and descriptors were added to illustrate the ‘meta’ themes of
each scenario.
c. Physical risk mapping. Using mapping tools, the climate
working group analysed the possible physical climate impacts on
all our owned infrastructure, in addition to key leased sites and
certain strategic supplier sites out to 2100 for each scenario. The
following types of climate impacts were assessed: sea level rise,
coastal flooding, extreme precipitation, total precipitation, surface
temperature and wind speed.
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
d. Healthcare and population modelling. The working group
consulted with subject matter experts within the business to overlay
our proprietary healthcare modelling with insights from global
population data. This offered estimates of the patient cohort size
and associated medical capacity required for a range of respiratory
conditions in each scenario. Population models helped to provide
a view as to the drivers of population growth (i.e. developed world
vs. developing world), while forecasts for healthcare expenditure
were also used to offer a view of the healthcare system’s capacity
in these scenarios.
e. Identify driving forces. The working group, in collaboration with
subject matter experts within our business, set about identifying key
factors within our value chain which influence climate-related risks
and opportunities. This included understanding key features such as
demographics, economic conditions, energy supply, technological
advancements, regulatory landscape, customer/market dynamics,
and population health and wellbeing. These driving forces were
then assessed against R&D, supply chain, manufacturing and sales
operations, market access and ability to operate, in order to identify
where their impact and influence would most meaningfully occur.
f. Draft scenario narratives. To provide a compelling illustration of
how different temperature outcomes and pathways would affect
our strategy and business model in plausible future states, scenario
narratives were prepared. Excerpts from each narrative are included
on the following pages.
g. Data sources to construct scenarios. A number of quantitative
and qualitative sources were used, including: The International
Institute for Applied Systems Analysis’ (IIASA) SSP Database,
Organisation for Economic Co-operation and Development (OECD)
GDP projections, OECD forecasts for healthcare expenditure,
IPCC Working Group I (WGI) Interactive Atlas, Climate Central’s
Surging Seas sea-level analysis tool, the IPCC’s Sixth Assessment
Report (AR6), Brian O’Neill’s article ‘The roads ahead: narratives
for shared socioeconomic pathways describing world futures in the
21st pathway’ published in Global Environment Change, February
2015, The International Energy Agency (IEA) transition scenarios:
the Stated Policies Scenario and Net Zero Emissions by 2050,
carbon price modelling from external consultants and the IEA,
and proprietary healthcare market demand modelling.
4. Scenario analysis workshops. A series of workshops were held with the
Carbon Committee and additional senior leaders. This mix of personnel
was chosen to ensure an appropriate cross-section of the business was
represented. The workshops were facilitated by our General Manager
Group Risk Advisory and Head of Sustainability & Environmental
Innovation. During the workshops, our business model and strategy
was analysed for resilience to climate-related risks and opportunities.
The analysis involved:
a. Identification of climate-related risks and opportunities, and
possible impacts.
b. Consideration of the severity and likelihood of impacts of those
risks and opportunities.
5. Board engagement. Following the workshops, the directors attended
a walk-through briefing in our workshop room during the February
2024 board meeting. An overview of the scenario analysis process
and a sample of workshop inputs and outputs was provided. Directors
were able to build on their understanding of the data, assumptions
and parameters in each scenario, discuss the process used and
question the assumptions.
6. Workshop evaluation session. Following consolidation of the workshop
outputs, the working group reported back to the workshop attendees
to attain consensus on the key risks and opportunities identified under
each scenario in order to feed these into our broader risk management
framework and transition planning activities. The working group
subsequently reported back to the ARC during the March 2024 meeting.
7. Ongoing improvement in analysis. We are committed to improving our
scenario analysis process. Key improvements identified for subsequent
reporting periods include:
a. Financial impact analysis to support risk and opportunity analysis
and quantification of anticipated financial impacts for our next
reporting period.
b. Improving the breadth and depth of the data, including healthcare
data, and expanding the risk modelling and categories of physical
risk modelling, and understanding of vulnerabilities in third party
distribution (freight / shipping) infrastructure.
c. Engaging with a broader range of people within the business.
d. Improving our ability to understand the climate-related risks of
our suppliers and customers, which is currently limited by the
availability of their own data and information.
e. During the FY25 financial year, we expect to align climate-related
risk management processes and the scenario analysis with strategic
business planning cycles.
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Strategy
Long-term thinking is at the core of our sustainable, profitable growth model. It can take many years to bring a new healthcare product to market and
achieve changes in clinical practice – this necessitates foresight, discipline, and careful planning.
This is evidenced across the business, in how we continuously strive to improve our products, invest in R&D, scale our infrastructure and global operations,
and collaborate with partners. For more details on our business model, refer to page 21 of the annual report titled “How we deliver value”.
Our focus on the long term is also reflected in our views on environmental and social responsibility, and our intention to create a positive, lasting impact
on society and the environment. The need to consider climate-related risks and opportunities over decades aligns with this way of thinking.
Current impacts – 2024 financial year
Below is a non-exhaustive sample of current impacts of climate change that the business has responded to over the reporting period. While current
impacts have been identified during the reporting period, they are not deemed to have a material current financial impact or expose the business to
material climate-related vulnerabilities.
Current ImpactKey DriverResponse
P
Physical risk - Impact of extreme weather events
The increase in frequency and severity of extreme weather events
(such as snowstorms, flood, drought, windstorms) could cause damage
to our owned and leased sites.
Managing the physical resilience of our global network of
manufacturing locations, warehouses and offices ensures customers
receive our products and services without delay or interruption.
Supply chain,
manufacturing & sales
operations
We have developed site-selection criteria against which future
property purchases or material lease locations are assessed. Using
risk mapping and projection tools, we make educated decisions
about future key locations to ensure owned and leased sites are
resilient to extreme weather events.
Measured against our current site-selection criteria, and the
available physical risk modelling tools, we are of the view that our
key strategic locations have strong levels of resilience to extreme
weather events over the next few decades.
As weather models develop, we will continue to monitor and assess
the resilience of our sites and the site-selection criteria.
P
Physical risk - Water scarcity
Our manufacturing facilities in Tijuana, Mexico are situated in
a water-scarce region, relying on water being delivered from a
neighbouring state, which in turn relies on the stressed Colorado River
basin catchment.
During the 2024 financial year, water costs to service our three
manufacturing facilities in Tijuana increased approximately 30% amid
ongoing pressure to water supply.
Supply chain,
manufacturing & sales
operations
In March 2023, a water plant in Mexico to treat and re-use water
deployed became operational. This plant is currently saving
approximately 50% of water for our second building, with a goal of
an 80% reduction in the near future.
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Current ImpactKey DriverResponse
T
Transitional risk - Carbon reduction market access requirements
During the 2024 financial year, the National Health Service (NHS) in
the United Kingdom mandated the external publishing of a carbon
reduction plan and net zero commitment (by 2050) for in-market
Scope 1 and 2, and some Scope 3 emissions.
Market access
Ability to operate
Our team has responded with a commitment to meet the 2050 net
zero target for the market in the United Kingdom with work ongoing
to identify the most effective way to achieve this.
T
Transitional risk - Green buildings
To meet the needs of our growing business, future expansion may
increase our carbon footprint through the embodied carbon in
construction and increasing our consumption of utilities (power and
water).
Supply chain,
manufacturing
& sales operations
In scoping future construction projects, our team will consider
innovations in both architectural and engineering designs, and
whether this improvement can be designed into our future owned
and built assets.
T
Transitional risk - Compliance with reporting obligations
We are required to comply with the reporting obligations as a climate-
reporting entity.
Market access
Ability to operate
We created a climate working group to facilitate, support and
prepare these climate-related financial disclosures. As a global
business, we are preparing for similar reporting obligations to come
into force in the other jurisdictions we operate in.
T
Transitional risk & opportunity - Ecodesign
In a future where carbon-based materials are restricted by regulation
or become scarce, we may need to utilise alternate materials or more
carbon-efficient design.
R&DWe have established collaborative teams to work on a number of
eco-efficiency projects including:
− undertaking environmental lifecycle assessment across our current
and future products
− the development of alternate or biobased plastics and/or circular
materials
− the development of sustainable packaging solutions.
By positioning carbon use as a design challenge, we anticipate our
teams will be able to develop new methods, materials and ways of
working to reduce our reliance on carbon-based materials.
We also utilise the expertise of the Ecodesign Advisory Board. For
more details on their input, refer to page 98 of the annual report.
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Our Climate Scenarios
The climate scenarios and scenario narratives we used to stress-test the climate resilience of our business model and strategy are outlined below. For
more detail on their development and rationale for selection, refer to the Scenario Analysis section of these climate-related disclosures at pages 99-101.
Scenario 1: Outpatient
In the Outpatient scenario, rapid climate action sees the world achieve net zero by 2050 and reach the stated Paris Agreement goal – a 1.5°C degree
temperature increase above pre-industrial levels. Shared Socioeconomic Pathway 1 (SSP1) is known as ‘Sustainability – Taking the Green Road’, due to
low challenges of mitigation and adaption. This has been selected as a plausible scenario to test how we would respond in a rapidly decarbonising and
transitioning landscape.
OverviewKey FeaturesNarrative (excerpt)
1.5°C
Global temperature
increase peaks at 1.5°C
by the year 2050, before
settling to 1.4°C in 2100.
6.9B
Global population in
2100.
2.2%
OECD GDP growth to
2100 (CAGR), compared
with a historical (prior
50 years) growth rate
of 2.5%.
Climate & Weather
There is a continuation of acute weather events globally, with sea level rise and
coastal flooding presenting the most impactful challenges in certain regions.
Demographics & Economy
Global population climbs 6.4% by 2040, before marking an overall decline of 12%
by 2100. The aged population cohort rises from a baseline of ~10% to ~45% in 2100.
Low- and medium-income countries experience high GDP growth, while high-
income countries see moderate growth. GDP growth (CAGR) for OECD nations is
3.9% in 2040 (from a 2020 baseline), slowing to 2.2% on a 2100 timescale.
Energy
The majority of electricity is generated from renewable sources, with fossil fuels
becoming expensive to use.
Technology
There is a concerted global effort to implement ‘green’ technology into the value
chain, with a significant focus placed on energy efficiency, reusability, and bio-
based raw materials.
Regulation & Policy
There is effective international cooperation. High levels of regulation are imposed,
such as carbon pricing and taxes, carbon reduction disclosure mandates, and
climate-resilient infrastructure requirements.
Market Conditions
There is elevated and sustained pressure from customers and investors upon
businesses to mitigate the impacts of climate change.
Health & Wellbeing
There are high levels of investment in healthcare relative to 2024 levels.
• The political momentum for a course correction builds,
aided by effective international co-operation and a
heightened sense of urgency.
• Participation in New Zealand’s Emissions Trading Scheme
(ETS) becomes mandatory over time, encompassing fuel
used, purchased electricity and landfill/waste disposal
costs at the East Tāmaki and Karaka sites.
• OECD countries adopt similar emissions trading schemes,
and the price of carbon units rises steadily in these
markets.
• A carbon credit scheme for all global shipping lanes is
introduced, which forwarders and shipping lines pass
through to their customers.
• The European Union proceeds with the introduction of its
Carbon Border Adjustment Mechanism (CBAM).
• To compete in tenders, there is an increased need for
energy-efficient hardware, reusables, bio-based raw
materials, recycled packaging, take-back/recycling
programs and life-cycle assessments across our product
range.
• All of our future infrastructure projects are subject to
stringent climate-resilience requirements.
• There is continued growth in global population out to
2040, before declining out to 2100. There is a significant
increase in the aged population cohort.
• A 1.5°C warming scenario, and the associated worsening
in environmental and atmospheric conditions, leads to an
increase in the incidence and prevalence of respiratory
conditions from a 2020 baseline.
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Scenario 2: Emergency Department
In the emergency department scenario, a disorderly transition makes net zero unattainable by 2050 as emissions rise above current levels, resulting in
temperature increase by 2.7°C from pre-industrial temperature by 2100. Shared Socioeconomic Pathway 2 (SSP2) is described as ‘Middle of the Road’,
due to medium challenges to mitigation and adaption. This has been selected as a plausible scenario to test how we would respond in a disrupted and
uneven landscape where demands vary greatly across different markets.
OverviewKey FeaturesNarrative (excerpt)
2.7°C
Global temperature
increase by the year
2100.
9.0B
Global population
in 2100.
2.1%
OECD GDP growth to
2100 (CAGR), compared
with a historical (prior
50 years) growth rate of
2.5%.
Climate & Weather
There is a meaningful increase in acute and chronic weather events globally,
with sea level rise, coastal flooding and increases in surface temperature
presenting significant challenges in many regions.
Demographics & Economy
Global population climbs 12.3% by 2040 and arrives at an overall increase of
15% by 2100. The aged population cohort rises from a baseline of ~10% to ~30%
in 2100. There is uneven GDP growth across the board. GDP growth (CAGR)
for OECD nations is 3.0% in 2040 (from a 2020 baseline), slowing to 2.1% on a
2100 timescale.
Energy
There is some investment in renewables but a continued reliance on fossil fuels.
Technology
There is an uneven development of technology, with the level of innovation and
intent varying greatly depending on the market.
Regulation & Policy
There is relatively weak international cooperation - government intervention
is delayed and uneven. There is varying application of carbon pricing and taxes.
Market Conditions
There is inconsistent pressure from customers and investors to mitigate climate
change, and expectation levels vary depending on the region/country.
Health & Wellbeing
There is a medium level of investment in healthcare relative to 2024 levels.
• The world’s progress towards its climate goals is uneven, with
limited additional progress beyond today’s policy framework
both here in New Zealand and internationally.
• Rather than achieving global consensus on mitigation, there
are varying expectations in different regions, with some
markets pursuing carbon reduction while others lag. This
makes it challenging for us to cater to its range of markets
while remaining competitive.
• On the whole, there is a hesitancy among customers and
healthcare systems to carry the added cost of carbon-friendly
products.
• We see meaningful disruption at our global sites.
Coastal flooding and sea level rise make for extremely
challenging operating conditions at certain owned and
leased warehouse facilities in Asia in the coming decade,
while surface temperature increases in Tijuana, Mexico have
a significant flow-on effect to energy costs and associated
carbon intensity.
• Support from suppliers on our sustainability targets is mixed
depending on their broader customer base and which regions
they service. This results in the bifurcation of our supply
chain, where some suppliers are unable to meet the standards
for those end markets with stringent requirements (i.e. the
European Union).
• There is accelerated growth in global population out to 2040,
and then population growth slows.
• A 2.7°C warming scenario, and the associated worsening
in environmental and atmospheric conditions, leads to a
meaningful increase in the incidence and prevalence of
respiratory conditions from a 2020 baseline.
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
OverviewKey FeaturesNarrative (excerpt)
3.6°C
Global temperature
increase in 2100.
12.6B
Global population in
2100.
1.3%
OECD GDP growth to
2100 (CAGR), compared
with a historical (prior
50 years) growth rate of
2.5%.
Climate & Weather
There is a significant increase in acute and chronic weather events globally,
with sea-level rise, coastal flooding, increases in surface temperature and wind
speed presenting significant challenges in most regions.
Demographics & Economy
Global population surges 61% by 2100, with rapid growth in developing
countries. There is slow GDP growth across the board.
Energy
Fossil fuels become difficult to source due to nationalistic and protectionist
action from governments. Electricity grids are disrupted amid a lack of suitable
alternatives.
Technology
There is slow technological progress and innovation and constrained budgets
fuels demand for commodity goods. Protectionism results in nations
competing to secure access to technology.
Regulation & Policy
There is weak, uneven international cooperation as traditional institutions falter.
Nation states adopt protectionist policies to preserve domestic resources.
Market Conditions
There are different levels of demand and funding by region and country,
though on the whole there is limited focus on carbon reduction. Economic
development is slow, and consumption is material-intensive.
Health & Wellbeing
There is a low level of investment in healthcare (relative to 2024 levels) amid
constrained budgets and competing priorities for expenditure.
• Global efforts to address climate change are derailed by
nationalistic and protectionist actions. Competition intensifies
as resources are depleted and climate impacts worsen –
nations turn inward and prioritise regional issues.
• Climate regulatory frameworks falter and there is a lack of
consensus on how to proceed. Alliances and trade blocs
deepen.
• This tension impacts the cost of goods and services. There
are significant increases in fossil fuel costs amid a lack of
alternatives and as oil reserves are depleted. This drives up
the cost of shipping, energy, and the sourcing of resins and
other raw materials critical to our production.
• We see significant disruption at our global sites. Average wind
speed increases across much of our network, including at
our East Tāmaki campus and our distribution sites in Western
Europe. Coastal flooding and sea level rise presents challenges
for certain leased sites in Asia, as does an increase in surface
temperature in Mexico. Global shipping routes are congested
as the Panama Canal experiences drought conditions each
year, significantly reducing the number of passages each year.
• Nations and regions compete to secure access to medical
devices and technology. Patent enforcement becomes
increasingly difficult in this environment.
• There is significant population growth on both a 2040 and
2100 timescale, with a particular growth surge in developing
nations.
• A 3.6°C warming scenario, and the associated worsening
in environmental and atmospheric conditions, leads to
a significant increase in the incidence and prevalence of
respiratory conditions from a 2020 baseline.
Scenario 3: High-Dependency Unit
In the high-dependency unit scenario, global co-operation efforts falter and self-interest actions prevail. This leads to emissions approximately doubling,
resulting in a 3.6°C increase in global temperature and significant climate and weather impacts. Shared Socioeconomic Pathway 3 (SSP3) is described as
‘Regional Rivalry – a Rocky Road”, due to high challenges of mitigation and adaption. This has been selected as a plausible scenario to test how we would
respond in a highly volatile and physically impacted world.
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Definitions
In identifying risks and opportunities, we acknowledge and adopt the definitions
used in by the XRB in NZCS 1:
Physical risks: Risks related to the physical impacts of climate change. Physical
risks emanating from climate change can be event-driven (acute) such as
increased severity of extreme weather events. They can also relate to longer-
term shifts (chronic) in precipitation and temperature and increased variability
in weather patterns, such as sea level rise.
Transition risks: Risks related to the transition to a low-emissions, climate-
resilient global and domestic economy, such as policy, legal, technology,
market and reputation changes associated with the mitigation and adaptation
requirements relating to climate change.
Opportunities: The potentially positive climate-related outcomes for an entity.
Efforts to mitigate and adapt to climate change can produce opportunities for
entities, such as through resource efficiency and cost savings, the adoption and
utilisation of low-emissions energy sources, the development of new products
and services, and building resilience along the value chain.
Time horizons: We have considered risks and opportunities across three
different time horizons: short, medium and long term. We define short term as
within the next five years (2024-2029), medium term as between five and 15
years (2030-2039) and long term as 15 years and beyond (2040 onwards).
Climate-related risks and opportunities
Fisher & Paykel Healthcare has built a global business by identifying
a difficult medical problem and designing an innovative solution.
Without a doubt, a changing climate will present challenging
problems, and we will respond to them the way we always have
– by collaborating and innovating. For that reason, we view some
of the impacts of climate change as risks and opportunities at the
same time. We have identified anticipated climate-related risks and
opportunities, including time horizons and potential management
responses and strategies, across three climate scenarios:
“Outpatient”, “Emergency Department” and “High-Dependency Unit”.
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Driver(s)DescriptionAnticipated ImpactRisk or Opportunity TimeframePotential Response
R&DGlobal customer
demand for low-
carbon products
A rapid transition to a low-carbon product offering would be
required.
The scenario assumes a cohesive global focus on carbon
reduction, meaning the majority of our key markets will be
impacted by this transition.
We have an opportunity to innovate and develop and
transition to low-carbon products ahead of our competitors.
Risk and
Opportunity
(transition)
Short term
Medium
term
Long term
• Accelerate our carbon reduction and
Ecodesign initiatives
• Re-allocate investment and initiatives
to low-carbon R&D
• Monitor development of ‘green’
technologies and materials by
suppliers, competitors and other
innovators
Supply chain,
manufacturing
& sales
operations
Widespread
enforcement of
carbon tax regimes
A high likelihood of carbon tax regimes being enforced
under this scenario will increase the cost of raw materials,
manufacturing and freight.
This will have a particular impact on products manufactured
in New Zealand due to the distance to many key end markets
(such as the United States and the European Union), resulting
in margin impact.
Access to certain raw materials are likely to be constrained
under this scenario.
Risk (transition) Short term
Medium
term
Long term
• Evaluate infrastructure network
design strategy and the geographical
mix of manufacturing output
• Decrease reliance on external utilities
required for manufacturing
• Evaluate advancements and/
or collaboration opportunities in
shipping and freight
• Review procurement strategy to
enable continued sourcing of critical
raw materials
Supply chain,
manufacturing
& sales
operations
Increase in adverse
weather events
An increase in the rise and severity and frequency of weather
events (albeit at a more moderate level than that of our other
two scenarios), may cause supply chain disruption.
Due to our global footprint, it is assumed that a number of
our locations may be impacted by adverse weather events,
although current modelling suggests our key locations have
strong levels of resilience.
Risk (physical)Medium
term
Long term
• Broaden analysis on severe weather
events across our network, assess
the impact on product/distribution
flow, and improve business continuity
planning initiatives
• Continue to refine site-selection
criteria based on improved climate
modelling
R&D
Market access
Threats to market
share amid
emergence of novel
technology and
increased levels of
competition
The need for rapid innovation spurs the introduction of
novel technology and the level of investment incentivises
new competitors to enter our markets in certain product
categories and/or particular geographic markets. This may
make it more challenging to maintain market share and our
long-term aspirational growth trajectory.
If we can develop novel and patent-protected technology
ahead of our competitors, we have an opportunity to gain a
competitive advantage.
Risk &
Opportunity
(transition)
Medium
term
Long term
• Continue to analyse and monitor
customer requirements compliance
obligations, and integrate into our
long-term business planning
• Re-allocate investment and initiatives
to low-carbon R&D
• Apply appropriate patent protection
to innovative low-carbon technology
and product design
Market access
Ability to
operate
Heightened
regulatory
and customer
requirements
There is a high compliance burden under this scenario amid
stringent regulatory frameworks in key markets. Moreover,
customers request a high level of detail on our carbon
footprint in addition to our progress and effectiveness on
broader environmental and social responsibility efforts.
Risk (transition) Short term
Medium
term
Long term
• Increase investment in processes/
systems for gathering information
and data required to make accurate
disclosures and respond to requests
for information
Scenario 1: Outpatient | 1.5°C
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Scenario 2: Emergency Department | 2.7°C
Driver(s)DescriptionAnticipated ImpactRisk or Opportunity TimeframePotential Response
R&DDivergent market
requirements
There are uneven and divergent market requirements with
some markets firmly committing to carbon reduction while
others are ambivalent or deprioritise carbon reduction.
If we can develop products to cater to this divergence ahead
of our competitors, we can gain a competitive advantage.
Risk &
Opportunity
(transition)
Medium
term
Long term
• Reassess the applicability of our
long-term carbon reduction plan and
ecodesign initiatives
• Refine strategy to monitor customer/
market requirements
• Assess and manage cost / pricing
strategy
• Assess whether current levels of
R&D investment in lower-carbon
technology initiatives is adequate
Supply chain,
manufacturing
& sales
operations
Market access
Ability to
operate
Variances in cost
base as a result of
increased market
complexity
The differing regional requirements (per above) result in a
variance in our cost base. This may make it more challenging
to maintain market share and achieve our long-term
aspirational growth trajectory.
Risk (transition) Medium
term
Long term
• Evaluate any variance in cost base to
execute a product strategy (including
R&D implications) to meet different
market requirements
• Evaluate network design strategy
and the geographical mix of
manufacturing output in order to
optimise operational costs
Supply chain,
manufacturing
& sales
operations
Meaningful
increase in adverse
weather events
There is a meaningful increase in the severity and frequency
of weather events, resulting in more significant supply chain
disruption. Due to our global footprint, it is assumed that a
number of our locations are impacted by acute and chronic
weather events (i.e. sea-level rise and coastal flooding
impacts on certain owned and leased sites in Asia, and
surface temperature impacts at our Tijuana, Mexico facilities).
Risk (physical)Short term
Medium
term
Long term
• Decrease reliance on external utilities
required for the manufacturing
process
• Broaden analysis on severe weather
events across our network, assess
the impact on product/distribution
flow, and improve business continuity
planning initiatives
• Hold additional stock to mitigate
supply chain disruption
• Refine site-selection criteria for
owned and leased locations
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Scenario 3: High-Dependency Unit | 3.6°C
Driver(s)DescriptionAnticipated ImpactRisk or Opportunity TimeframePotential Response
R&DPrioritisation of
infant and homecare
products
Given the strain on healthcare capacity
and funding in this scenario, there is
a prioritisation of neonatal/pediatric
patients, and also a need for greater
volumes of care to be delivered in lower-
intensity settings and/or the home.
Risk &
Opportunity
(transition)
Medium term
Long term
• Determine an appropriate level of R&D investment in
neonatal/pediatric products and technology to address
this prioritisation of care
• Determine an appropriate level of R&D investment in
homecare products and technology to address this
prioritisation of care
R&DRaw material
scarcity
Fossil fuel-based products, including
plastics and resins crucial to our
manufacturing process, become difficult
to attain in this scenario.
Risk (transition) Medium term
Long term
• Assess planned R&D activities and determine an
appropriate level of investment in sourcing/testing/
developing alternate raw materials
• Hold additional raw materials inventory to mitigate
supply volatility
Supply chain,
manufacturing
& sales
operations
Protectionist
policies impact trade
flows, making it
challenging to source
raw materials and
distribute products
Protectionist and nationalistic action
from governments increases the
likelihood of needing to localise and/or
regionalise our business model.
Risk (transition)Medium term
Long term
• Increase surveillance to monitor protectionist trends/
developments
• Increase surveillance to monitor competitors and new/
emerging entrants
• Assess the need for a product supply localisation /
regionalisation strategy
Supply chain,
manufacturing
& sales
operations
Significant increase
in adverse weather
events
There is a material increase in the
severity and frequency of weather
events, resulting in significant supply
chain disruption. Due to our global
footprint, it is assumed that a number of
our locations are impacted by acute and
chronic weather events (i.e. sea-level rise
and coastal flooding impacts on certain
owned and leased sites in Asia, wind
speed impacts at our New Zealand sites,
and surface temperature impacts at our
Tijuana facilities).
Risk (physical)Short term
Medium term
Long term
• Decrease reliance on external utilities required for the
manufacturing process
• Broaden analysis on severe weather events across
our network, impact on product/distribution flow and
improve business continuity planning initiatives
• Hold additional stock to mitigate supply chain disruption
• Refine site selection criteria for owned and leased
locations
• Assess workforce and production impact due to
increased staff absenteeism due to weather disruption
Market access
Ability to
operate
Market access
disruptions
There is a need to implement a ‘close
to customer’ network strategy to both
ensure continued market access amid
a protectionist landscape and mitigate
impact on our infrastructure due to
increased frequency and severity of
weather events.
Risk (transition) Medium term
Long term
• Consider the breadth and depth of our product suite and
the viability of maintaining this at its current size
• Monitor customer requirements, competitor dynamics,
customers’ ability to pay and/or price increases from
suppliers
• Consider network design and long-term infrastructure
plan
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Anticipated financial impacts
We have elected to use Adoption Provision 2: Anticipated Financial
Impacts (paragraphs 12-14 of NZCS 2) in this reporting period. This is
to allow additional time to refine our data inputs and methodology
and finalise financial modelling to assess reasonably expected anticipated
financial impacts of the risks and opportunities identified in our
scenario workshops.
Developing a climate-resilient
business model (transition planning)
We recognise we have a responsibility to care for the natural environment
while we pursue our business goals. Climate change is a growing concern
among our customers, investors, and our own people. We recognise it
is important that we strive for continuous improvement in this area, like
in all areas of our business. Our approach is to operate our business in
a resilient, efficient and responsible manner while improving care and
outcomes for patients.
The work we have done to plan and prepare for the future has allowed
us to mitigate some of the current impacts of climate change and
reduce their effect. The different potential climate futures that lie ahead
will provide both risks and opportunities for businesses, and with this
will come significant uncertainty. How climate change will impact our
business, including the risks and opportunities presented, will need to
be regularly monitored and reviewed so that we can continue to maintain
a resilient business.
We have elected to use Adoption Provision 3: Transition Planning
(paragraph 15 of NZCS 2) in this first year of reporting to allow time to
consider the output of our financial modelling into the anticipated financial
impacts of identified climate-related risks and opportunities and to embed
the financial analysis and sustainability objectives which exist across our
business into business planning cycles in a more meaningful way.
We have identified a number of carbon reduction initiatives across
the business. These initiatives inform the development of our carbon
reduction long-term plan which provides a pathway to net zero CO
2
e by
2050. A key contributing factor to our emissions profile is the emissions
generated in the use phase of our products. Our ecodesign long-term
plan supports carbon reduction by embedding sustainable product design
into the business. We also consider carbon impacts and sustainability
objectives when assessing our infrastructure and network design. These
plans are being validated throughout the business and by the Board,
with implementation plans being developed. These plans feed into our
business planning cycles, which are performed on both a one-year time
horizon (annual business planning) and a 15-year time horizon (long-term
business planning).
We have established collaborative teams to work on a range of topics,
including ecodesign, sustainable packaging, biobased and circular
materials, sustainable production and environmental life cycle assessment.
We believe that by investing in these initiatives, we can be more innovative
and successful in the long term.
Our work to assess the amount or extent of assets or business activities
vulnerable to climate-related risks (and aligned to opportunities), including
the methodology and metrics to quantify, is ongoing and is not included
in this first year of reporting. We see this assessment of business exposure
as linked to the financial modelling of current and reasonably anticipated
financial impacts (we have taken Adoption Provision 2 for the latter).
Internal emissions price: We conduct annual surveillance of carbon pricing
and policy developments across our global markets. We are developing
internal carbon cost tools and an internal carbon price model, so that we
can factor in carbon impacts to our decision-making.
Capital deployment: Climate-related risks and opportunities are
considered when deploying capital and making funding decisions in
relation to projects that involve our manufacturing infrastructure; for
example, we have previously disclosed details on our solar installation
projects and our water re-use treatment plant at our facilities in
Tijuana, Mexico. Going forward, we intend to integrate climate risk and
opportunities as relevant throughout the business when decisions are
being made in relation to capital deployment and funding.
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Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Metrics and targets
Our approach is to operate our business efficiently and responsibly while
improving care and outcomes for patients.
We measure our carbon emissions, and have set science-based targets
to reduce emissions from our value chain. We are a Toitū carbonreduce
certified organisation having measured greenhouse gas emissions in
accordance with ISO 14064-1:2018 and are committed to managing and
reducing our impact in respect of our operational emissions.
GHG emission reporting, metrics and targets
We have been measuring our greenhouse gas emissions since 2012. Over
this time, we have improved our measurement processes and subsequent
auditing of our carbon footprint. We have progressively expanded the
geographical boundary of our audit and the scope of emissions sources
measured. Each year we engage an independent auditor to audit our
carbon footprint.
Greenhouse gas (GHG) emissions
GHG emissions (tonnes CO
2
e)FY2022FY2023FY2024
% Change
FY2023 to
FY2024
Scope 11,7772,2872,123 -7.2%
Scope 2 (location-based)13,89414,52914,293-1.6%
Scope 2 (market-based) 10,34411,10512,25310.3%
Sub-total: Scope 1 & Scope 2
(location-based)15,67116,81616,416-2.4%
Sub-total: Scope 1 & Scope 2
(market-based)12,12113,39214,3767.3%
Scope 3457,112328,313302,479-7.9%
Total: Scope 1, Scope 2
(location-based) & Scope 3 emissions472,783345,129318,895-7.6%
Total: Scope 1, Scope 2
(market-based) & Scope 3 emissions469,233341,705316,855-7.3%
GHG emission intensity
(tonnes CO
2
e/revenue NZ$M)
1
280.4216.1181.8
2
-16.7%
Carbon emissions
Our carbon audit for the 2024 financial year shows a carbon footprint
of 316,855 of CO
2
e, representing a decrease of 7.3% on the prior
financial year.
3
1 GHG emission intensity calculated using Scope 2 market-based methodology
2 GHG emission intensity has declined when compared to the prior two financial periods, largely driven by a decline in
hospital hardware sales
3 Total Scope 1, Scope 2 (market-based) and Scope 3 emissions
112Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Emission categories
Scope 1 includes GHG emissions from sources that we own or control.
This includes the fuel used in vehicles we own or lease, natural gas and
emissions generated through the use of refrigerants.
Scope 2 includes indirect GHG emissions from the generation of
electricity we purchase, as well as the generation of purchased heat,
which is sourced or occurs at our manufacturing sites and our sales
operations around the world.
Scope 3 includes GHG emissions generated by our own suppliers and
customers. The most significant Scope 3 GHG emissions which contribute
to our carbon footprint include:
• emissions generated from transportation, including freight, business
travel and employee commuting
• emissions from purchased raw materials which are used in the
production of our products
• emissions associated with the use of our products; including the
electricity used during the use phase of our hardware, water use,
medical gases used in connection with our products and end of life
emissions associated with product disposal.
Performance during the 2024 financial year
Scope 1 emissions have decreased slightly, while our Scope 2 emissions
have continued to increase. This increase is as a result of more production
occurring in Mexico and the establishment of our manufacturing facility in
Guangzhou, China.
Scope 3 emissions have declined, largely driven by a reduction in use-
phase emissions amid lower hospital hardware sales.
One of the largest Scope 3 emissions sources is the electricity use of
our products. Reducing these emissions is dependent on the global
decarbonisation of the energy and the healthcare sector. Through
our Ecodesign programme we look for opportunities to apply energy
efficiency in design of our products.
Methods, assumptions and uncertainties in
estimating GHG emissions
GHG emissions have been measured in accordance with ISO 14064-1:2018
and consolidated using the operational control approach. There are no
exclusions from our organisational boundary. Emissions factors and Global
Warming Potentials (GWP) are provided by the Toitū carbonreduce
programme and supplemented by our own emissions factor database.
Toitū Envirocare’s Emanage software is used to calculate our carbon
inventory. All emissions sources that contribute more than 1% of our total
Scope 1 and 2 emissions are measured, as well as all indirect emissions
sources required by ISO 14064-1:2018.
Our GHG emissions are calculated using a number of methods, including
activity data (i.e. kWh for electricity consumption) multiplied by relevant
emission factors. We use activity data directly from our suppliers where
this is available and practical to collect. Where activity data is not easily
obtainable, emissions have been estimated using spend data by category
and an appropriate conversion factor to estimate the emissions. Where
spend data cannot be split into the correct category and for smaller
locations that do not contribute a significant portion of revenue or
anticipated emissions, emissions have been estimated using the number of
full-time equivalent employees in the location multiplied by an appropriate
conversion factor based on our other similar operations.
Scope 3 use-phase emissions are estimated based on actual sales data
and intended use cases based on the expectations of product design
engineers. Local market considerations are then applied based on the
location where the product was sold if this information is available.
Fisher & Paykel Healthcare | ANNUAL REPORT 2024113
Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Assurance of GHG emissions
Our GHG emissions inventory is subject to independent assurance by Toitū
Envirocare (acting through Enviro-mark Solutions Limited). The assurance
is provided in accordance with ISO 14064-1:2018 and the requirements of
the Toitū carbonreduce programme.
For the financial year 2024, reasonable level of assurance was achieved
for Scope 1 and 2 emissions, and certain Scope 3 emissions
4
. Limited
assurance was achieved for the validation of Scope 3 use phase modelled
emissions
5
. A copy of the Toitū Envirocare independent audit opinion
and our GHG inventory and management report is available on the
sustainability section of our website.
Science-based carbon reduction targets
Aligned with the goals of the Paris Agreement to limit global warming
to 1.5 degrees Celsius, we are working toward net zero CO
2
e by 2050.
Setting near-term targets helps to guide us in the right direction. In 2019
we engaged with the Science Based Targets initiative (SBTi), a corporate
climate action organisation which supports companies to set greenhouse
gas emissions reduction targets in line with what is needed to meet the
goals of the Paris Agreement. We set science-based targets for our Scope
1 and Scope 2 carbon emissions, being those emissions within our control,
along with our Scope 3 supplier engagement target. Those targets were
approved by the SBTi as consistent with levels required to limit global
warming to 1.5 degrees Celsius.
Our approved Scope 1 and 2 target is an absolute target to achieve a 67%
reduction in our Scope 1 and 2 emissions by 2034 from a 2019 baseline.
Since setting our target, our overall Scope 1 and 2 emissions have
increased. This is largely due to our response to the global COVID-19
pandemic and the increase in production capacity over this period. Our
ability to achieve our science-based targets is a process and depends on
many factors, some that are within our control and some that are not.
Implementation of renewable energy infrastructure, for example solar
panels in Mexico, and the continued sourcing of renewable contracts will
support our journey towards meeting our target.
We are committed to educating our suppliers about their responsibility to
reduce carbon emissions and to set their own science-based targets. Our
Scope 3 supplier engagement target is calculated by assessing suppliers
based on spend and is dependent on supplier awareness and willingness
to engage. Twenty-nine of our suppliers have set a science- based target
via the SBTi framework.
Our Scope 3 supplier engagement target is currently in the process of
being renewed. We expect to have a revised approved Scope 3 supplier
target during the second half of the FY25 financial year. Once approved
this target will be published on the sustainability section of our website.
4 ISO 14064-1:2018 Category 3: Indirect emissions from transportation; Category 4 Indirect emissions from products used
by Fisher & Paykel Healthcare
5 ISO 14064-1:2018 Category 5: Indirect emissions associated with the use phase of Fisher & Paykel Healthcare products
114Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
Fisher & Paykel Healthcare | ANNUAL REPORT 2024115
Section 3 | OPERATING SUSTAINABLY | Climate-related Disclosures
116
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
FINANCIALS
4
Fisher & Paykel Healthcare | ANNUAL REPORT 2024117
The financial commentary below provides an overview of the financial results for the year
ended 31 March 2024. Readers should refer to the following financial statements and notes
for an understanding of the basis on which the financial results are determined.
INCOME STATEMENTS
Year ended 31 March
2023
NZ$M
2024
NZ$M
Change
Reported
%
Change
CC (1)
%
Operating revenue 1,581.11,742.8+10+8
Gross profit 938.41,044.4+11+10
Gross margin 59.4%59.9%+58 bps+95 bps
SG&A expenses (431.9)(492.8)+14+13
R&D expenses (174.3)(198.2)+14+14
Total operating expenses (606.2)(691.0)+14+13
Operating profit 332.2353.4+6+3
Operating margin 21.0%20.3%-73 bps-85 bps
Revaluation of land–(98.1)
Profit before financing and tax332.2255.3-23-31
Net financing expense (4.2)(19.6)
Profit before tax 328.0235.7-28-35
Tax expense(77.7)(103.1)+33+33
Profit after tax250.3132.6-47-56
Underlying profit after tax
(2)
250.3264.4+6+5
1 Constant currency (CC) removes the impact of exchange rate movements. This approach is used to assess the Group’s
underlying comparative financial performance without any impact from changes in foreign exchange rates. See further
details on page 122.
2 Underlying profit after tax has been presented excluding the impact of abnormal items occurring during the 2024
financial year. A reconciliation is set out on page 119.
Total profit after tax for the year was $132.6 million, a 47% decline from last year, or 56%
in constant currency. Excluding the impact of the land revaluation, provision for product
recall, and the change in the tax treatment of building depreciation in the 2024 financial
year, profit after tax (“Underlying profit after tax”) was $264.4 million, a 6% increase or
5% in constant currency.
Revenue
Operating revenue was $1,742.8 million, a 10% increase from the prior comparable period
(PCP) or 8% in constant currency. Hospital revenue increased 5% in constant currency.
Hospital consumables continued to see strong demand across the product range.
Homecare revenue grew 16% in constant currency with strong growth in masks of 18%
in constant currency.
Gross margin
Gross margin at 59.9% increased by 95 basis points in constant currency from last year.
Excluding the impact of the voluntary recall provision, underlying gross margin was 61.1%,
a 216 basis point increase in constant currency from last year. Freight costs reduced
and benefits from manufacturing efficiencies and pricing more than offset cost increase
impacts on gross margin.
Operating expenses
Operating expenses increased 14% (13% in constant currency) to $691.0 million, reflecting
the full year impact in 2024 of our investment in R&D and sales people during the 2023
financial year. This investment supports our global sales growth and development of our
product pipeline.
R&D spend of $198.2 million grew 14%. Over the long-term we plan for R&D spend to grow
in line with constant currency revenue growth.
Financing expenses
The net financing expense was $19.6 million, an increase of $15.4 million from the prior
year, due to the increased borrowings to fund the purchase of the Karaka site and higher
interest rates. Interest expense increased to $18.2 million (2023: $6.7 million). Net financing
costs include exchange losses on foreign currency interest-bearing liabilities of $4.7 million
(2023: $0.1 million).
Ta x
The underlying effective tax rate was 25.3% (2023: 23.7%). The R&D tax credit this period
of $18.0 million (2023: $15.9 million) represents the estimated eligible R&D expenditure
incurred during the year. Excluding the R&D tax credit, the underlying effective tax rate
was 30.5% (2023: 28.5%).
During the year, the New Zealand government passed legislation to remove commercial
building depreciation for tax purposes. Deferred tax liabilities have increased by
$19.3 million resulting in an increase in the tax expense of $19.3 million as the tax base
of the Company’s buildings in New Zealand reduced to nil.
118
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
FINANCIAL COMMENTARY
UNDERLYING FINANCIAL
PERFORMANCE
While we understand the importance
of reported profits meeting the
NZ IFRS standards, we believe the
underlying profit measurements will
assist readers to better understand
the Group’s 2024 financial year
performance, and against which
future performance should be
considered.
During the 2024 financial year, net
profit after tax includes the expense
associated with the voluntary Airvo
2 and myAirvo 2 product recall,
revaluation of the land in Karaka,
New Zealand, and the tax expense
associated with the removal of
building depreciation deductibility
in New Zealand. We believe the
financial impact of each of these
have distorted the reported financial
results and a more meaningful
representation of the performance of
our business for the year and for the
future is the underlying result.
Further details of each of these
is included within Note 3 of the
Financial Statements – Significant
transactions and events. We have
included a full reconciliation of the
impact each of the above abnormal
items to what we consider the
“underlying” income statement.
Adjustments for abnormal items
Year ended 31 March 2024
Reported
NZ$M
Growth
(CC)
%
Product
recall
NZ$M
Revaluation
of land
NZ$M
Deferred
tax*
NZ$M
Underlying
NZ$M
Underlying
growth
change
%
Underlying
growth
change (CC)
%
Operating revenue 1,742.8 +8 – – – 1,742.8 +10+8
Cost of sales (698.4)+6 20.0 – – (678.4)+6+3
Gross profit 1,044.4 +10 20.0 – – 1,064.4 +13+12
Gross margin 59.9%+95 bps61.1%+172 bps+216 bps
SG&A expenses (492.8)+13 – – – (492.8)+14+13
R&D expenses (198.2)+14 – – – (198.2)+14+14
Total operating expenses (691.0)+13 – – – (691.0)+14+13
Operating profit 353.4 +3 20.0 – – 373.4 +12+10
Operating margin 20.3%-85 bps21.4%+41 bps+36 bps
Revaluation of land (98.1) – 98.1 – –
Profit before financing and tax 255.3 -31 20.0 98.1 – 373.4 +12+10
Net financing expense (19.6) – – – (19.6)
Profit before tax 235.7 -35 20.0 98.1 – 353.8 +8+7
Tax expense (103.1)+33 (5.6) – 19.3 (89.4)+15+12
Profit after tax 132.6 -56 14.4 98.1 19.3 264.4 +6+5
Basic earnings per share 22.8 cps 45.4 cps
Diluted earnings per share 22.6 cps 45.1 cps
* Deferred tax on removal of building depreciation.
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024119
FINANCIAL COMMENTARY CONTINUED
FINANCIAL COMMENTARY CONTINUED
FOREIGN CURRENCY IMPACTS
The Group is exposed to movements in foreign exchange rates, with approximately 99%
of operating revenue generated in currencies other than NZD as shown below.
US dollars 49%
Mexican peso 1%
Other currencies 29%
Euros 19%
New Zealand dollars 1%
Over 60% of COGS and over 50% of operating expenses are in currencies other than NZD.
Net profit after tax has benefitted by $2.6 million from favourable foreign currency impacts
compared to the prior year.
The effect of balance sheet translations for the year resulted in an increase in operating
revenue of $7.1 million (2023: $11.0 million increase) and an increase in profit after tax of
$1.1 million (2023: $2.1 million decrease). The hedging programme contributed a pre-tax
gain of $1.9 million (2023: $3.7 million gain).
The average daily spot rate, the average conversion exchange rate (i.e. the accounting rate,
incorporating the benefit of forward exchange contracts in respect of the relevant financial
year) and the closing spot rate of the main foreign currency exposures for the reported
periods are set out in the table below.
Average daily
spot rate
Average conversion
exchange rateClosing spot rate
Year ended 31 March202320242023202420232024
USD0.6240.6100.6670.6580.6290.599
EUR 0.5990.5620.5450.5440.5770.554
MXN12.2710.5614.4813.0211.389.91
Foreign exchange hedging position
In line with our hedging programme, additional hedges have been added for future years.
The hedging position for our main currency exposures as at 13 May 2024 is:
Year to 31 March20252026202720282029
2030
-2035
+
USD % cover of expected exposure 80%75%60%45%20%0%
USD average rate of cover 0.6210.6070.5970.5840.5640.523
EUR % cover of expected exposure 90%75%60%40%40%5%
EUR average rate of cover 0.5320.5320.5260.5240.5070.465
MXN % cover of expected exposure 55%30%0%
MXN average rate of cover 13.7712.6511.41
Hedging cover has been rounded to the nearest 5%.
+ 2030 – 2035 shows average % cover of expected exposure and rate of cover for the five-year period.
CASH FLOWS
The full statement of cash flows is provided on page 126.
Year ended 31 March
2023
NZ$M
2024
NZ$M
Change
NZ$M
Operating profit 332.2353.421.2
Plus depreciation and amortisation99.0114.315.3
Change in working capital and other(65.6)30.496.0
Net interest paid(6.2)(16.7)(10.5)
Net income tax paid(121.2)(51.8)69.4
Operating cash flows238.2 429.6 191.4
Lease repayments(14.4)(16.8)(2.4)
Purchase of land and buildings(89.0)(251.3)(162.3)
Purchase of plant and equipment(98.8)(65.5)33.3
Purchase of intangible assets(23.5)(22.2)1.3
Free cash flows12.5 73.861.3
Dividends paid(195.7)(145.5)50.2
+ Free cash flows include lease liability repayments following the adoption of NZ IFRS 16.
120
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
FINANCIAL COMMENTARY CONTINUED
Operating cash flows
Cash flows from operations for the period increased to $429.6 million (2023: $238.2 million).
Operating cash flows were impacted by an increase in profit excluding non-cash items,
favourable net working capital movements primarily as a result of lower inventories and a
benefit from prepaying tax during the 2023 financial year, resulting in less tax paid during
the 2024 financial year. Higher financing costs have slightly offset these benefits.
Capital expenditure
During the period, $339.0 million was spent on capital expenditure (excluding
leased assets), including $189.5 million relating to the purchase of land for a second
New Zealand campus in Karaka. Spending also included progressing our East Tāmaki
campus development including earthworks for our fifth building. We continue to invest
in production tooling and equipment additions.
Dividends
Dividends paid of $145.5 million were 26% lower than the prior period due to the
reintroduction of the Dividend Reinvestment Plan (DRP) commencing with the interim
dividend for the 2023 financial year, paid in December 2022. Under the DRP, $92.6 million
of dividends were reinvested as new shares this period relating to the 2023 final and 2024
interim dividends declared, reducing the cash paid by the same amount.
BALANCE SHEET
As at 31 March
2023
NZ$M
2024
NZ$M
Change
NZ$M
Trade receivables179.6219.539.9
Inventories365.8320.4(45.4)
Less trade and other payables
+
(125.2)(111.3)13.9
Working capital420.2428.68.4
Property, plant and equipment
++
1,148.21,340.0191.8
Intangible assets85.688.42.8
Lease liabilities (62.5)(74.9)(12.4)
Other net assets (liabilities)124.29.2(115.0)
Net cash (debt)37.7(32.2)(69.9)
Net assets1,753.41,759.15.7
+ Trade and other payables exclude all non-current payables and all employee entitlements and provisions
++ Property, plant and equipment includes lease assets recognised
Trade receivables have increased at 31 March 2024 reflecting the level of sales in the last
couple of months in each year. Our debtor days were within the normal range at 45 days
(Mar 2023: 40 days). Inventories have decreased by $45.4 million since March 2023,
particularly finished goods, reflecting production levels continuing below demand through
the year. Trade and other payables reduction includes timing associated with key capital
infrastructure projects and payment of suppliers.
Property, plant and equipment (excluding leased assets) increased by $181.6 million in
the year. The increase was driven by $122.0 million for the Karaka land acquisition net
of revaluation decrease. Other additions of $107.1 million were offset by depreciation of
$70.1 million. There were also $17.3 million for upward revaluations of the East Tāmaki land
in New Zealand and the Mexico land. Net intangible assets increased by $2.8 million, with
additions in patents and trademarks spending of $26.5 million and software spending of
$4.3 million primarily for ERP as we continue to roll out SAP globally.
Other net assets/liabilities movements included the provision for the voluntary recall of
$20 million recognised this year. Net tax payable increased by $38.6 million during the
year, reflecting prepaid tax during the prior year reducing the payments required in the
current year. Non-current other receivables decreased by $27.5 million as the deposit for
the second New Zealand campus was reclassified to property, plant and equipment on
receipt of Overseas Investment Office (OIO) approval this year. Net derivative financial
instrument assets reduced by $18.1 million. All currency derivatives continued to be
effective hedges.
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024121
Net cash and debt facilities
As at 31 March
2023
NZ$M
2024
NZ$M
Change
NZ$M
Loans and borrowings
– Current–(77.4)(77.4)
– Non-current(79.1)(35.7)43.4
Bank overdrafts(4.2)(1.1)3.1
Total interest-bearing liabilities
+
(83.3)(114.2)(30.9)
Total cash and investments 121.082.0(39.0)
Net (debt) cash37.7(32.2)(69.9)
Gearing-2.3%1.8%–
Undrawn committed debt facilities624.5544.3(80.2)
Undrawn uncommitted debt and
overdraft facilities
90.082.0(8.0)
+ Excluding lease liabilities
As at 31 March 2024, the average maturity of loans and borrowings of $113.1 million
was 1.5 years. The currency split for loans and borrowings was 36% NZD; 59% USD;
3% Australian dollars; and 2% Canadian dollars. During the year, $60 million of committed
borrowing facilities matured and were not renewed. Within the next 12 months, one facility
for $66.8 million, which is fully drawn at 31 March 2024, will expire.
Cash and cash equivalents were $82.0 million at 31 March 2024. This balance, operating
cash generated in the 2025 financial year as well as any additional borrowings, will fund
ongoing capital expenditure and the payment of the final dividend.
Gearing
1
At 31 March 2024 the Group had net debt of $32.2 million and net gearing of 1.8%.
This was within the target gearing range of -5% to +5%.
NOTES - CONSTANT CURRENCY
Constant currency analysis is non–Generally Accepted Accounting Practice (GAAP)
financial information, that is not prepared in accordance with New Zealand Equivalents
to International Financial Reporting Standards (NZ IFRS). Constant currency information
has been provided to assist users of financial information to better understand and assess
the Group’s financial performance without the impacts of foreign currency fluctuations,
including hedging results.
Constant currency financial information is prepared each month to enable the Board
and management to monitor and assess the Group’s underlying comparative financial
performance without any distortion from changes in foreign exchange rates. Constant
currency information is prepared on a consistent basis for reported periods restated
into NZD based on “constant” exchange rates, typically the budgeted exchange rates for
the current year. This information excludes the impact of movements in foreign exchange
rates, hedging results and balance sheet translations.
The Group’s constant currency framework can be found on the company’s website
at www.fphcare.com/ccf. PwC perform assurance procedures over the constant
currency information.
RECONCILIATION OF CONSTANT CURRENCY TO REPORTED PROFIT AFTER TAX
Year ended 31 March
2023
NZ$M
2024
NZ$M
Change
NZ$M
Profit after tax (constant currency) 213.993.6(120.3)
Spot exchange rate effect31.736.54.8
Foreign exchange hedging result 2.61.4(1.2)
Balance sheet revaluation 2.11.1(1.0)
Total impact of foreign exchange36.439.02.6
Profit after tax (reported) 250.3132.6(117.7)
RECONCILIATION OF CONSTANT CURRENCY TO REPORTED REVENUE
Year ended 31 March
2023
NZ$M
2024
NZ$M
Change
NZ$M
Operating revenue (constant currency) 1,523.71,651.6127.9
Spot exchange rate effect 53.999.445.5
Foreign exchange hedging result (7.5)(15.3)(7.8)
Balance sheet revaluation 11.07.1(3.9)
Total impact of foreign exchange57.491.233.8
Operating revenue (reported) 1,581.11,742.8161.7
The significant exchange rates used in the constant currency analysis, being the budget
exchange rates for the year ended 31 March 2024, are USD 0.66, EUR 0.61, JPY 85, MXN 12.0.
1 Net interest-bearing debt (debt less cash and cash equivalents and short-term investments) to net interest-bearing
debt and equity (less hedging reserves). Net interest-bearing debt excludes lease liabilities.
FINANCIAL COMMENTARY CONTINUED
122
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
CONSOLIDATED INCOME STATEMENT
For the year ended 31 March 2024
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 March 2024
Notes
2023
NZ$M
2024
NZ$M
Operating revenue 4 1,581.1 1,742.8
Cost of sales (642.7)(698.4)
Gross profit 938.4 1,044.4
Selling, general and administrative expenses (431.9)(492.8)
Research and development expenses (174.3)(198.2)
Total operating expenses (606.2)(691.0)
Operating profit 332.2 353.4
Revaluation of land 9 – (98.1)
Profit before financing and tax 332.2 255.3
Financing income 2.6 3.3
Financing expense (6.7)(18.2)
Exchange loss on foreign currency
interest-bearing liabilities
(0.1)(4.7)
Net financing expense (4.2)(19.6)
Profit before tax 5 328.0 235.7
Tax expense 11 (77.7)(103.1)
Profit after tax 250.3 132.6
Basic earnings per share 16 43.3 cps 22.8 cps
Diluted earnings per share 16 43.0 cps 22.6 cps
The accompanying notes form an integral part of the financial statements.
Notes
2023
NZ$M
2024
NZ$M
Profit after tax 250.3 132.6
Other comprehensive income
Items that may be reclassified to profit or loss
Foreign currency translation reserve
Exchange differences on translation
of foreign operations
4.1 2.0
Hedging reserves
Changes in fair value in hedging reserves (58.6)(14.7)
Transfers to profit before tax from cash flow
hedge reserve
(3.7)(3.1)
Tax on above reserve movements11 17.4 5.0
Items that will not be reclassified to profit or loss
Revaluation of land 9 47.6 17.3
Other comprehensive income, net of tax 6.8 6.5
Total comprehensive income 257.1 139.1
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024123
FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 March 2024
Notes
Share
capital
NZ$M
Retained
earnings
NZ$M
Reserves
NZ$M
Total
equity
NZ$M
Balance at 31 March 2022 261.21,181.2237.31,679.7
Total comprehensive income –250.36.8257.1
Dividends paid 17 –(231.0)–(231.0)
Issue of share capital under the dividend reinvestment plan 15 35.3––35.3
Issue of share capital under employee share plans 15 5.4––5.4
Movement in share based payments reserve 17 ––5.15.1
Movement in treasury shares 15 1.8––1.8
Balance at 31 March 2023 303.71,200.5249.21,753.4
Total comprehensive income – 132.6 6.5 139.1
Dividends paid 17 – (238.1) – (238.1)
Issue of share capital under the dividend reinvestment plan 15 92.6 – – 92.6
Issue of share capital under employee share plans 15 9.5 – – 9.5
Movement in share based payments reserve 17 – – 4.4 4.4
Movement in treasury shares 15 (1.8) – – (1.8)
Balance at 31 March 2024 404.0 1,095.0 260.1 1,759.1
The accompanying notes form an integral part of the financial statements.
124
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
CONSOLIDATED BALANCE SHEET
As at 31 March 2024
Notes
2023
NZ$M
2024
NZ$M
ASSETS
Current assets
Cash and cash equivalents 121.0 82.0
Trade and other receivables 7 218.5 257.2
Inventories 8 365.8 320.4
Derivative financial instruments 6 33.2 36.3
Tax receivable 35.7 9.0
Total current assets 774.2 704.9
Non-current assets
Derivative financial instruments 6 70.0 53.5
Other receivables 29.9 2.4
Property, plant and equipment 9 1,148.2 1,340.0
Intangible assets 10 85.6 88.4
Deferred tax assets 11 96.6 92.5
Total assets 2,204.5 2,281.7
LIABILITIES
Current liabilities
Borrowings 12 4.2 78.5
Lease liabilities 12 17.1 17.7
Trade and other payables 13 219.7 219.9
Provisions 14 20.9 31.0
Tax payable 6.6 18.5
Derivative financial instruments 6 21.3 19.4
Total current liabilities 289.8 385.0
Notes
2023
NZ$M
2024
NZ$M
LIABILITIES
Non-current liabilities
Borrowings 12 79.1 35.7
Lease liabilities 12 45.4 57.2
Provisions 14 7.3 6.3
Other payables 13 21.6 21.4
Derivative financial instruments 6 4.8 11.4
Deferred tax liabilities 11 3.1 5.6
Total liabilities 451.1 522.6
EQUITY
Share capital 15 303.7 404.0
Retained earnings 1,200.5 1,095.0
Reserves 17 249.2 260.1
Total equity 1,753.4 1,759.1
Total liabilities and equity 2,204.5 2,281.7
The accompanying notes form an integral part of the financial statements.
On behalf of the Board
28 May 2024
Scott St John Lewis Gradon
Board Chair Managing Director and
Chief Executive Officer
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024125
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 March 2024
2023
NZ$M
2024
NZ$M
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers 1,543.0 1,716.2
Interest received 2.8 3.2
Payments to suppliers and employees (1,177.4) (1,218.1)
Tax paid (121.2) (51.8)
Interest paid (6.5) (16.4)
Lease interest paid (2.5) (3.5)
Net cash flows from operating activities 238.2 429.6
CASH FLOWS FROM INVESTING ACTIVITIES
Net short-term investments 200.0 –
Purchases of property, plant and equipment (187.8) (316.8)
Purchases of intangible assets (23.5) (22.2)
Net cash flows from investing activities (11.3) (339.0)
CASH FLOWS FROM FINANCING ACTIVITIES
Issue of share capital under employee share plans 3.0 3.0
New borrowings 137.5 300.6
Repayment of borrowings (127.5)(270.0)
Lease liability payments (14.4) (16.8)
Dividends paid (195.7) (145.5)
Net cash flows from financing activities (197.1)(128.7)
Net increase (decrease) in cash 29.8 (38.1)
Opening cash 84.6 116.8
Effect of foreign exchange rates 2.4 2.2
Closing cash 116.8 80.9
RECONCILIATION OF CLOSING CASH
Cash and cash equivalents 121.0 82.0
Bank overdrafts (4.2) (1.1)
Closing cash 116.8 80.9
2023
NZ$M
2024
NZ$M
CASH FLOW RECONCILIATION
Profit after tax 250.3 132.6
Add (deduct) non-cash items:
Depreciation - right-of-use assets 16.6 17.7
Depreciation and amortisation - other assets 82.4 96.6
Share based payments 9.0 10.8
Movement in provisions (9.2) 9.0
Movement in deferred tax assets / liabilities 4.8 10.2
Movement in net tax payables (49.3) 39.2
Foreign currency translation 1.2 (0.7)
Revaluation of land– 98.1
Other non-cash items 1.6 3.8
57.1 284.7
Net working capital movements:
Trade and other receivables (43.3) (38.5)
Inventories (6.9) 45.4
Trade and other payables (19.0) 5.4
(69.2) 12.3
Net cash flows from operating activities 238.2 429.6
The accompanying notes form an integral part of the financial statements.
126
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
1. REPORTING ENTITY
Fisher & Paykel Healthcare Corporation Limited (the “Company” or “Parent”) together
with its subsidiaries (the “Group”) is a leading designer, manufacturer and marketer
of medical device products and systems for use in both hospital and homecare settings.
Products are sold in over 120 countries worldwide. The Company is a limited liability
company incorporated and domiciled in New Zealand. The address of its registered office
is 15 Maurice Paykel Place, East Tāmaki, Auckland. These consolidated financial statements
were approved for issue by the Board of Directors on 28 May 2024.
2. BASIS OF PREPARATION AND PRINCIPLES OF CONSOLIDATION
Statement of compliance
The Company is registered under the Companies Act 1993 and is an FMC reporting entity
under Part 7 of the Financial Markets Conduct Act 2013. The Company is also listed on the
NZX and the ASX. The consolidated financial statements have been prepared in accordance
with the requirements of Part 7 of the Financial Markets Conduct Act 2013.
These consolidated financial statements for the year ended 31 March 2024 have been
prepared in accordance with New Zealand Generally Accepted Accounting Principles
(NZ GAAP). They comply with New Zealand Equivalents to International Financial
Reporting Standards (NZ IFRS), other New Zealand accounting standards and
authoritative notices that are applicable to entities that apply NZ IFRS. The consolidated
financial statements also comply with International Financial Reporting Standards (IFRS).
The Group is a for-profit entity for the purposes of complying with NZ GAAP.
Basis of measurement
These consolidated financial statements have been prepared under the historical cost
convention, as modified by the revaluation of financial assets and liabilities (including
derivative instruments) at fair value through profit or loss and/or other comprehensive
income, and the revaluation of land.
Functional and presentation currency
The consolidated financial statements are presented in New Zealand dollars (NZD),
which is the Company’s functional currency to the nearest hundred thousand dollars
unless otherwise stated. Items included in the financial statements of each of the
subsidiaries are measured using the currency of the primary economic environment
in which the entity operates (the “functional currency”).
The Group operates as one integrated business, and the functional currency of all
material global operations is NZD, with the exception of Fisher & Paykel Healthcare
Mexico Properties S.A. de C.V. (“Mexico Properties”). Mexico Properties was established
for the purpose of holding the Group’s property in Mexico, and its functional currency
is United States dollars (USD).
The results and financial position of entities that have a different functional currency are
translated to NZD as follows: assets and liabilities are translated at the exchange rate at
balance date and income statement items are translated at rates approximating the foreign
exchange rates ruling at the dates of transactions. Exchange differences are recognised in
other comprehensive income as a currency translation reserve movement.
Foreign currency transactions and balances
Foreign currency transactions are translated into the relevant functional currency at
the exchange rates at the dates of the transactions. Foreign exchange gains and losses
resulting from the settlement of such transactions and from the translation at period end
exchange rates of monetary assets and liabilities denominated in foreign currencies are
recognised in the income statement, except when deferred in other comprehensive income
as qualifying cash flow hedges.
Critical accounting estimates and judgements
The preparation of financial statements in conformity with NZ IFRS requires the use
of certain critical accounting estimates. It also requires management to exercise its
judgement in the process of applying the Group’s accounting policies. The Directors
regularly review all accounting policies and areas of judgement in presenting the
financial statements. Significant estimates are disclosed in each of the applicable
notes to the financial statements and are designated with an symbol.
Material accounting policy information
Material accounting policy information is disclosed in each of the applicable notes
to the financial statements and is designated with an symbol.
Basis of consolidation
The consolidated financial statements incorporate the assets and liabilities of all
subsidiaries of the Group as at balance date and the results of all subsidiaries for
the year then ended. All subsidiaries are 100% owned within the Group.
Intercompany transactions, balances and unrealised gains on transactions between
Group companies are eliminated. Unrealised losses are also eliminated unless the
transaction provides evidence of the impairment of the asset transferred.
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024127
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
Building depreciation
During the year, the New Zealand government passed legislation to remove commercial
building depreciation for tax purposes. As a result of the legislation change, the deferred
tax liabilities have increased by $19.3 million with a corresponding increase in tax expense
of $19.3 million as the tax base of the Company’s buildings has reduced to nil.
Borrowing facilities
During the year, $60 million of committed external financing facilities matured and were
not renewed. The Group borrowed $300.6 million from available facilities during the
year primarily to fund the payment of $189.5 million for the purchase of land in Karaka.
Subsequently $270.0 million has been repaid. The Company had total available committed
external financing facilities of $646.8 million as at 31 March 2024, of which approximately
$544.3 million was undrawn. As at 31 March 2024, the weighted average maturity
of committed borrowing facilities was 2.7 years.
Share capital
During the year, the Group issued a total of 3,960,480 shares under the Dividend
Reinvestment Plan (DRP) and 646,626 shares under employee share based payment
arrangements. Under the DRP, 2,184,251 new shares were issued relating to the FY23 final
dividend at an average price of $23.5961 per share, totalling $51.6 million and a total of
1,776,229 new shares were issued relating to the FY24 interim dividend at an average price
of $23.0752 per share, totalling $41.0 million.
4. OPERATING REVENUE AND SEGMENTAL INFORMATION
2023
NZ$M
2024
NZ$M
Sales revenue 1,588.6 1,758.1
Foreign exchange loss on hedged sales (7.5) (15.3)
Total operating revenue 1,581.1 1,742.8
Revenue by product group
Hospital products 1,023.5 1,087.9
Homecare products 553.8 652.3
1,577.3 1,740.2
Distributed and other products 3.8 2.6
Total operating revenue 1,581.1 1,742.8
Revenue after hedging by geographical location of customer:
North America 683.8 806.1
Europe 427.6 477.3
Asia Pacific 399.0 368.9
Other¹ 70.7 90.5
Total operating revenue 1,581.1 1,742.8
1 Other includes New Zealand, Latin America (including Mexico), Africa and the Middle East.
3. SIGNIFICANT TRANSACTIONS AND EVENTS IN THE FINANCIAL YEAR
The following significant transactions and events affected the financial performance
and financial position of the Group for the year ended 31 March 2024:
Land acquisition and valuation
In September 2022, the Group announced that one of its subsidiaries, Fisher & Paykel
Healthcare Properties Limited (FPH Properties), had entered into an agreement to purchase
land for a second New Zealand campus in Karaka for $275.0 million. In April 2023, OIO
consent was received with standard conditions and special conditions which require FPH
Properties to obtain necessary planning consents, undertake initial development of the
site and invest in capital expenditure in line with the Group strategy. $217.0 million has
been paid to date for 79.4 hectares of land which was capitalised during the year. A further
$43.0 million is to be paid in January 2026 and the final payment of $15.0 million is due in
December 2026 for the acquisitions of the remaining 24.8 hectares of land in Karaka.
As at 31 March 2024, the Group obtained external valuations of land for financial reporting
purposes, including East Tāmaki and Karaka in New Zealand and Tijuana, Mexico. The East
Tāmaki and Tijuana land values increased by $17.3 million in total, which is recognised
as a revaluation gain within Other Comprehensive Income which is included in the Asset
Revaluation Reserve. The Karaka land value decreased by $98.1 million, which is recognised
as an expense in the Income Statement.
The East Tāmaki land was valued at $263.9 million, resulting in a valuation increase of
$11.1 million. The Tijuana land was valued at USD $22.5 million, resulting in a valuation
increase of USD $3.8 million. The Karaka land owned as at 31 March 2024 was valued
at $122.0 million, resulting in a valuation decrease of $98.1 million. The total revaluation
decrease is recognised within the Income Statement.
At 31 March 2024 the historic cost of all land sites is $333.9 million and the fair value
recognised on the balance sheet is $423.6 million. Details of each land valuation are
included within Note 9 of these financial statements.
Property, plant and equipment
During the year, construction work progressed on the car park building on our East Tāmaki,
New Zealand campus and earthworks continue for the construction of a fifth building on
our East Tāmaki site. Capital commitments at 31 March 2024 include $12.4 million related
to these projects. To date, spending on these projects totals $75.2 million.
Voluntary limited product recall
In March 2024, the Group initiated a voluntary limited recall of Airvo 2 and myAirvo 2
devices manufactured before 14 August 2017. The voluntary limited recall relates to a
speaker configuration issue that may result in distorted, intermittent or inaudible alarm
sound levels. This does not affect the therapy delivered by the Airvo 2 or myAirvo 2 device
and the devices will otherwise perform as intended. A provision has been recognised
through cost of sales for the total estimated recall cost of $20 million (refer Note 14).
128
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
4. OPERATING REVENUE AND SEGMENTAL INFORMATION (CONTINUED)
Segmental reporting
The Group operates in one segment - being the design, manufacture, marketing and
sale of medical devices and systems globally. These products and systems are for use
in respiratory care, acute care, surgery and the treatment of OSA in the home and
hospital. Resource allocation decisions are made to optimise the Group’s financial
operating profit. This is consistent with the internal management reports the chief
operating decision-maker (CODM)
1
reviews.
Revenue is recognised at the point in time performance obligations are satisfied
by transferring control of goods to the customer at the transaction price specified
in the contract. Control typically transfers to the customer at the same time as the
legal title passes to the customer, typically on delivery. The transaction price includes
all amounts which the Group expects to be entitled to net of sales taxes and other
indirect taxes, expected rebates and discounts. Where applicable, rebates and/or
discounts are included within the consideration using an estimation typically based
on the most likely method, and are only recognised to the extent that it is highly
probable that a significant reversal will not occur.
There are no significant financing components in the Group’s revenue arrangements.
1 CODM comprised the Board of Directors (which includes the Chief Executive Officer), Vice President – Products and
Technology, Senior Vice President – Sales and Marketing and the Chief Financial Officer during the 2024 financial year.
5. EXPENSES
2023
NZ$M
2024
NZ$M
Profit before tax is after charging the following specific expenses:
Donations 0.3 0.4
Inventory written down (net) 22.3 25.9
Fees paid to auditors
2023
NZ$000
2024
NZ$000
Statutory audit and half year review (i) 1,506 1,740
Other assurance and audit related services (ii) 39 42
Total audit, other assurance services and audit-related services 1,545 1,782
Other services (iii) 62 25
Total fees paid to auditors 1,607 1,807
Other fees paid to auditors
(i) Statutory audit and half year review includes $662,274 (2023: $510,500) paid to other
PwC network firms.
(ii) Other assurance and audit related services of $41,900 (2023: $39,100) include
assurance procedures in relation to compliance with the constant currency framework.
(iii) Other services of $24,624 in 2024 includes regulatory tax compliance procedures in
Mexico and market survey data relating to executive remuneration levels. In 2023 other
services fees of $61,600 includes providing executive remuneration benchmarking,
market survey data relating to executive remuneration levels and regulatory tax
compliance procedures in Mexico.
The fee paid to PwC for the audit and review of the Group’s financial statements is split
across the jurisdictions where there are subsidiary entities that require an audit or are a
significant component of the Group.
2023
NZ$000
2024
NZ$000
PwC New Zealand 1,075 1,120
PwC Overseas offices 532 687
1,607 1,807
Section 42|2FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024129
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
6. DERIVATIVE FINANCIAL INSTRUMENTS
20232024
Assets
NZ$M
Liabilities
NZ$M
Assets
NZ$M
Liabilities
NZ$M
CURRENT
Foreign currency forward exchange contracts – cash flow hedges 32.3 20.7 36.3 19.0
Foreign currency forward exchange contracts – not hedge accounted 0.4 0.6 – 0.4
Interest rate swaps & options – cash flow hedges 0.5 – – –
33.2 21.3 36.3 19.4
NON-CURRENT
Foreign currency forward exchange contracts – cash flow hedges 69.7 4.8 53.5 11.4
Interest rate swaps & options – cash flow hedges 0.3 – – –
70.0 4.8 53.5 11.4
Derivatives are initially recognised at fair value on the date a derivative contract is
entered into, and are subsequently re-measured to their fair value. The method of
recognising the resulting gain or loss depends on whether the derivative is designated
as a hedging instrument and, if so, the nature of the item being hedged. The Group
generally applies hedge accounting to all derivative financial instruments.
The Group designates certain derivatives as hedges of highly probable forecast
transactions (cash flow hedges). At the inception of the transaction the Group
documents the relationship between hedging instruments and hedged items, as well as
the risk management objective and strategy for undertaking various hedge transactions.
The Group also documents their assessment, both at hedge inception and on an ongoing
basis, of whether the derivatives that are used in hedging transactions have been and
will continue to be highly effective in offsetting changes in cash flows of hedged items.
Any ineffective portion is recognised immediately in the income statement. Derivatives
that are designated as hedges will be classified as non-current if they have maturities
greater than 12 months after the balance sheet date.
Some components of hedge accounted derivatives are excluded from the designated
risk. Cash flow hedges include only the intrinsic value of options. Time value on
options is excluded from the hedge designation and is marked to market through
other comprehensive income and accumulated within a separate component of equity
(‘the costs of hedging reserve’ within ‘hedging reserves’) until such time as the related
hedge accounted cash flows affect profit or loss. At this stage the cumulative amount
is reclassified to profit or loss.
Master netting arrangements
The Group enters into derivative transactions under the International Swaps and Derivatives Association (ISDA) master agreements. The ISDA agreements do not meet the criteria
for offsetting derivatives in the balance sheet. Netting arrangements are only enforceable upon early termination, for example, on occurrence of a credit default. Refer to Note 21 for
information on the calculation of fair values and maturity of undiscounted cash flows for these financial instruments.
130
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
6. DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)
Contractual amounts of derivative financial instruments were as follows:
2023
NZ$M
2024
NZ$M
Foreign currency forward contracts and options
Sale commitments forward exchange contracts 2,754.8 3,109.5
Purchase commitments forward exchange contracts 61.2 52.1
Foreign currency borrowing forward exchange contracts 117.9 64.2
Interest rate derivatives
Interest rate swaps 31.9 2.5
Undiscounted foreign currency contractual amounts for outstanding hedges were
as follows:
Foreign Currency
2023
M
2024
M
Sale commitments
United States dollars US$1,060.0US$962.5
European Union euros €289.5€526.5
Japanese yen ¥11,980.0¥9,260.0
Purchase commitments
Mexican pesos MXN$999.0MXN$743.5
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024131
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
7. TRADE AND OTHER RECEIVABLES
2023
NZ$M
2024
NZ$M
CURRENT
Trade receivables 184.5 223.0
Loss allowance for doubtful trade receivables (4.9) (3.5)
179.6 219.5
Other receivables 38.9 37.7
218.5 257.2
Trade receivables are recognised initially at fair value and subsequently measured at
amortised cost using the effective interest method, less loss allowance for doubtful
trade receivables. Estimates are used in determining the level of receivables that
may not be collected. The Group has applied the simplified approach to calculating
expected credit losses on trade receivables and recognises a doubtful debt provision
based on the lifetime expected credit loss at each reporting date.
Bad debts are written off when they are considered to have become uncollectable.
Trade receivables credit risk
As at balance date 85% of trade receivables were current (2023: 91%) with 1% (2023: 4%)
more than 90 days past due. The total loss allowance for doubtful trade receivables
represents an estimate of the expected credit losses in respect of trade receivables and
covers the majority of these more than 90 days past due balances. The expected credit
losses are assessed by reference to historical collection trends and are adjusted to reflect
current and forward-looking information on macroeconomic factors affecting the ability of
the customers to settle the receivables.
Customer and receivable concentration
2023 2024
Five largest customers’ proportion of the Group’s:
Operating revenue 24%23%
Trade receivables 13%16%
There is no history of default in relation to these customers. Further information about the
credit quality and the Group’s exposure to credit risk can be found in Note 21.
8. INVENTORIES
2023
NZ$M
2024
NZ$M
Materials 165.7 164.1
Finished products 256.4 235.4
Provision for inventory write downs (56.3) (79.1)
365.8 320.4
Inventories are stated at the lower of cost or net realisable value. Cost is determined
using the first-in, first-out (FIFO) method and includes expenditure incurred in
acquiring the inventories and bringing them to their existing location and condition.
The cost of finished products comprises materials, direct labour, other direct costs and
related production overheads (based on normal operating capacity). Net realisable
value is the estimated selling price in the ordinary course of business, less applicable
variable selling expenses.
132
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
9. PROPERTY, PLANT AND EQUIPMENT
Reconciliation of carrying amounts at the beginning and end of the year
LandBuildingsPlant & equipmentCapital projectsTotal
Fair Value
NZ$M
Structure (i)
NZ$M
Fit out
and other
NZ$M
Leased
assets
NZ$M
Purchased
NZ$M
Leased
assets
NZ$M
Buildings (i)
NZ$M
Other
NZ$MNZ$M
Cost and revaluation
Balance at 31 March 2022 219.7180.5238.850.6481.211.250.7158.11,390.8
Revaluation recognised in asset revaluation reserve 47.6–––––––47.6
Additions 6.610.87.833.223.06.047.076.7211.1
Transfers –37.28.8–41.7–(45.0)(42.7)–
Disposals ––(2.0)(8.3)(14.2)(2.1)––(26.6)
Foreign exchange differences 2.42.70.5–––4.1–9.7
Balance at 31 March 2023 276.3231.2253.975.5531.715.156.8192.11,632.6
Revaluation recognised in asset revaluation reserve 17.3–––––––17.3
Revaluation recognised in the income statement (98.1)–––––––(98.1)
Additions 224.41.06.927.416.05.743.035.8360.2
Transfers 2.25.38.4–52.3–(12.4)(55.8)–
Disposals ––(0.3)(6.1)(5.6)(6.2)–(0.4)(18.6)
Foreign exchange differences 1.54.20.2–0.1–0.3–6.3
Balance at 31 March 2024 423.6241.7269.196.8594.514.687.7171.71,899.7
Depreciation and impairment losses
Balance at 31 March 2022 –31.196.822.8275.17.2––433.0
Depreciation charge for the year –5.59.612.443.84.2––75.5
Disposals ––(1.3)(7.8)(13.4)(2.0)––(24.5)
Foreign exchange differences –0.4––––––0.4
Balance at 31 March 2023 –37.0105.127.4305.59.4––484.4
Depreciation charge for the year –6.411.812.851.94.9––87.8
Disposals ––(0.3)(1.2)(5.6)(5.9)––(13.0)
Foreign exchange differences –0.5––––––0.5
Balance at 31 March 2024 –43.9116.639.0351.88.4––559.7
Carrying amounts
At 31 March 2022 219.7149.4142.027.8206.14.050.7158.1957.8
At 31 March 2023 276.3194.2148.848.1226.25.756.8192.11,148.2
At 31 March 2024 423.6197.8152.557.8242.76.287.7171.71,340.0
(i) $2.4 million of finance costs were capitalised during the year in relation to building additions (2023: $1.3 million).
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024133
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
Land revaluation
As described in Note 21, land in Mexico and New Zealand is considered to be a level
3 asset within the fair value hierarchy for valuation purposes. Valuation of land
is performed in accordance with the provisions of NZ IAS 16 ‘Property, Plant and
Equipment’ and NZ IFRS 13 ‘Fair Value Measurement’. There are certain estimates
associated with determining fair value, with the significant input being comparable
land sales information per square metre (‘psm’) for similar properties adjusted to
reflect relevant physical and locational characteristics, including usability of land
(likely yield). In the case of development land, adjustments also include envisaged
future zoning and relevant timing of development.
East Tāmaki - New Zealand
The East Tāmaki, New Zealand land holding was valued by Jones Lang LaSalle
(JLL NZ), with an effective date of 31 March 2024. The valuation of land ranged
from $600 psm for development land to $643 psm for land with improvements.
The land has been revalued to $263.9 million, representing an increase of $11.1 million
recognised through asset revaluation reserve in equity.
Karaka - New Zealand
The Karaka, New Zealand land holding was valued by Savills NZ Limited, with an
effective date of 31 March 2024. The land acquired during the year comprised of
79.4 hectares for the development of a second New Zealand campus in Karaka and
includes a mix of rural and future urban zoned land. The land has been revalued from
a carrying cost at 31 March 2024 of $220.1 million to a fair value of $122.0 million,
representing a revaluation change of $98.1 million recognised within the income
statement. The valuation has been conducted in accordance with accepted market
approaches, the principle approach being the Direct (Sales) Comparison Approach.
Reference has also been made to the Residual Feasibility Analysis (Discounted
Cashflow) and Chance of Change (Plussage).
Tijuana - Mexico
The Mexico land holding was valued by Jones Lang LaSalle (JLL Mexico), with an
effective date of 31 March 2024. The land was valued at US$22.5 million (NZ$37.7
million), representing an increase of US$3.8 million (NZ$6.2 million) recognised
through asset revaluation reserve in equity.
9. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
Land is measured at fair value, based on periodic but at least triennial valuations by
external independent valuers less any impairment losses recognised after the date of
the revaluation. Valuations are performed with sufficient regularity to ensure that the
fair value does not differ materially from its carrying amount.
All other property, plant and equipment is stated at historical cost less depreciation
and impairment. Historical cost includes expenditure that is directly attributable to the
acquisition of the items. This cost includes labour attributable to bringing the assets
to the location and working condition for its intended use.
Depreciation is generally calculated using the straight line method and is expensed
over the estimated useful lives. Depreciation methods, residual values and useful lives
are reassessed at each reporting date. Estimated useful lives are as follows:
Buildings – structure 25 - 50 years
Buildings – fit-out and other 3 - 50 years
Plant and equipment 3 - 15 years
An asset’s carrying amount is written down immediately to its estimated recoverable
amount if the asset’s carrying amount is greater than its estimated recoverable amount.
Leased assets
The Group’s leases predominantly relate to property or equipment outside
New Zealand. All leases are included within property, plant and equipment.
Lease contracts are typically made for fixed periods between 3-12 years but may
have extension options. Lease terms are negotiated on an individual basis and contain
a wide range of different terms and conditions. The right-of-use (leased) asset is
depreciated over the shorter of the asset’s useful life and the expected lease term
on a straight-line basis.
Revaluations of land
Revaluation increases are recognised in other comprehensive income and
accumulated as a separate component of equity in the asset revaluation reserve,
except to the extent that they reverse a revaluation decrease of the same asset
previously recognised in the income statement, in which case the increase is
recognised in the income statement.
Revaluation decreases are recognised in the income statement, except to the extent
that they offset a previous revaluation increase for the same asset, in which case the
decrease is recognised in other comprehensive income and accumulated as a separate
component of equity in the asset revaluation reserve.
134
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
Property, plant and equipment (including leased assets) and intangible assets by
geographical location:
2023
NZ$M
2024
NZ$M
932.71,110.0
239.1265.2
62.053.2
New Zealand
Mexico
Other
The table below summarises the valuation approach to land and the principal
assumptions used in establishing the fair values:
20232024
Predominant land valuation
approach
Inputs used
to measure
fair value
Range of
significant
inputs
Weighted
average
Range of
significant
inputs
Weighted
average
Auckland East Tāmaki
Direct sales comparison
Rate per
sqm$558-600$590$600-643$628
Auckland Karaka
Direct sales comparison
with adjustments made
to reflect usability and
timing of zoning and
development
Rate per
sqm
n/an/a$50-$183$154
Mexico Tijuana
Direct sales comparisonRate per
sqm – USD
US$116US$116US$139-
146
US$143
Rate per
sqm – NZD
$166$166$232-
$244
$238
The significant unobservable input used in the fair value measurement of the Group’s
land is the value per square metre. Increases or decreases in the value per square
metre would result in corresponding increases or decreases in the total valuation.
Carrying amounts of land if measured at historical cost
Historical CostFair Value
Unit
2023
NZ$M
2024
NZ$M
2023
NZ$M
2024
NZ$M
East TāmakiNZ$M 81.9 86.4 248.3 263.9
KarakaNZ$M – 220.1 – 122.0
Total New Zealand NZ$M 81.9 306.5 248.3 385.9
MexicoUS$M 16.3 16.3 18.3 22.5
MexicoNZ$M 25.9 27.4 28.0 37.7
Total LandNZ$M 107.8 333.9 276.3 423.6
9. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
Section 42|2FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024135
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
Software: Software development
costs that are directly attributable to
the design and testing of identifiable
and unique software products and
acquired computer software licences
controlled by the Group are recognised
as intangible assets and are initially
capitalised at cost. Directly attributable
costs that are capitalised as part of
the software include employee costs.
The project costs (including the ERP
implementation) are transferred
from Capital projects in progress to
Software, as each stage is completed.
These software costs are amortised
over their useful economic life of
3 to 15 years.
The costs of configuring or customising,
and the ongoing fees to obtain access
to an application software in a cloud
computing Software-as-a-Service
agreement are recognised as expenses
when the services are received.
Patents and trademarks: Patents and
trademarks have a finite useful life and
are carried at cost less accumulated
amortisation and impairment losses.
Amortisation is calculated using the
straight line method to allocate the
cost of patents and trademarks over
their anticipated useful lives of 5
to 15 years. In the event of a patent
being superseded or a trademark
registration is not continued or
renewed, the unamortised costs
are expensed immediately.
10. INTANGIBLE ASSETS
Software
NZ$M
Patents,
trademarks &
applications
NZ$M
Other
NZ$M
Capital
Projects
in progress
NZ$M
Total
NZ$M
Cost
Balance at 31 March 2022 62.4 105.3 7.8 7.9 183.4
Additions 1.7 18.9 – 1.0 21.6
Transfers 3.4 – – (3.4) –
Disposals (6.9) (3.0) – – (9.9)
Foreign exchange differences – – 0.4 0.4 0.8
Balance at 31 March 2023 60.6 121.2 8.2 5.9 195.9
Additions 4.3 26.5 – 0.3 31.1
Transfers 2.9 – 1.3 (4.2) –
Disposals (0.1) (3.2) – (1.9) (5.2)
Foreign exchange differences – – 0.2 0.3 0.5
Balance at 31 March 2024 67.7 144.5 9.7 0.4 222.3
Amortisation and impairment losses
Balance at 31 March 2022 33.0 60.6 3.0 – 96.6
Amortisation for the year 5.1 18.2 0.2 – 23.5
Disposals (6.9) (2.9) – – (9.8)
Balance at 31 March 2023 31.2 75.9 3.2 – 110.3
Amortisation for the year 5.2 21.0 0.3 – 26.5
Disposals – (2.9) – – (2.9)
Balance at 31 March 2024 36.4 94.0 3.5 – 133.9
Carrying amounts
At 31 March 2022 29.4 44.7 4.8 7.9 86.8
At 31 March 2023 29.4 45.3 5.0 5.9 85.6
At 31 March 2024 31.3 50.5 6.2 0.4 88.4
136
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
11. INCOME TAX
Income tax expense
2023
NZ$M
2024
NZ$M
Profit before tax 328.0235.7
Tax expense at the New Zealand rate of 28% 91.866.0
Adjustments to tax:
Non-assessable income / additional deductible expenses (0.8)(0.5)
Non-deductible expenses / additional assessable income 7.28.9
Non-deductible revaluation of land –27.5
Foreign rates other than 28% (2.4)(0.8)
Effect of foreign currency translations (2.0)0.1
R&D tax credit (15.9)(18.0)
Removal of building depreciation –19.3
Prior period under/(over) provision (0.2)0.6
Tax expense 77.7103.1
This is represented by:
Current tax 70.092.8
Deferred tax 7.710.3
Tax expense 77.7103.1
Effective tax rate 23.7%43.7%
Effective tax rate excluding R&D tax credit, revaluation
of land and removal of building depreciation28.5%30.5%
The Organisation for Economic Co-operation and Development’s (OECD)/G20 Inclusive
Framework on Base Erosion and Profit Shifting (BEPS) addresses the tax challenges arising
from the digitalisation of the global economy. The BEPS Pillar Two model rules seek to
apply a 15% global minimum tax across all jurisdictions and is expected to apply to the
Group from 1 April 2024.
The Group has applied the exception to recognising and disclosing information about
deferred tax assets and liabilities related to Pillar Two income taxes. The Pillar Two rules
are enacted in countries in which the Group operates but not yet in effect. Since the Group
does not have significant operations in low-tax jurisdictions, the rules are not expected to
have a material impact.
Tax expense comprises current and deferred tax. Tax expense is recognised in the
income statement except to the extent that it relates to items recognised outside
of the income statement, in which case it is recognised in other comprehensive
income or directly in equity.
Current tax is the expected tax payable on the taxable income for the year, using
tax rates enacted or substantively enacted at the balance date. It also includes any
adjustment to tax payable for previous financial years.
Deferred tax arises due to temporary differences between the carrying amounts
of assets and liabilities for financial reporting purposes and those for tax purposes.
Deferred tax is determined using tax rates (and laws) that have been enacted or
substantively enacted by balance date and are expected to apply when the related
deferred tax asset is realised or the deferred tax liability is settled.
The R&D tax credit is estimated based on the eligible R&D expenditure incurred
during the period and is recognised as a deduction to current tax expense and offset
in current tax payable. The R&D tax credit is only recognised when there is reasonable
certainty the Group will comply with the conditions of the tax incentive.
IMPUTATION CREDITS
2023
M
2024
M
New Zealand imputation credits available for use in
subsequent reporting periods NZ$318.6 NZ$280.4
Australian franking credits available for use in subsequent
reporting periods A$16.2 A$19.3
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024137
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
11. INCOME TAX (CONTINUED)
Deferred tax assets / (liabilities)
Provisions
and accruals
NZ$M
Inventories
NZ$M
Leases
NZ$M
Property,
plant and
equipment and
intangibles
NZ$M
Financial
instruments
NZ$M
Employee
share based
payments
NZ$M
Other
NZ$M
Total
NZ$M
Balance at 31 March 2022 37.494.21.2(14.5)(39.2)4.10.483.6
Amounts recognised in:
Other comprehensive income ––––17.4––17.4
Directly in equity ––––––––
In the income statement (6.4)(2.3)0.60.3–0.6(0.3)(7.5)
Balance at 31 March 2023 31.091.91.8(14.2)(21.8)4.70.193.5
Amounts recognised in:
Other comprehensive income ––––5.0––5.0
Directly in equity –––––(1.3)–(1.3)
In the income statement 5.3(0.8)0.14.1–(0.2)0.59.0
In the income statement – removal of building depreciation–––(19.3)–––(19.3)
Balance at 31 March 2024 36.391.11.9(29.4)(16.8)3.20.686.9
Deferred tax assets and liabilities are offset within the balance sheet where they relate to income taxes levied by the same taxation authority.
138
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
12. INTEREST-BEARING LIABILITIES
20232024
Borrowings
NZ$M
Leases
NZ$M
Borrowings
NZ$M
Leases
NZ$M
CURRENT
Bank overdrafts 4.2–1.1–
Borrowings ––77.4–
Lease liabilities –17.1–17.7
4.217.178.517.7
NON-CURRENT
Borrowings expiring
Between one and two years 63.6–5.7–
Between two and three years 15.5–––
Between three and four years ––30.0–
Between four and five years ––––
Lease liabilities –45.4–57.2
79.145.435.757.2
Borrowings
Borrowings are recognised initially at fair value, net of transaction costs incurred.
Subsequent to initial recognition, borrowings are measured at amortised cost,
applying the effective interest rate method. Financing expenses directly attributable
to the acquisition, construction or production of a qualifying asset are capitalised
as part of the cost of that asset.
Borrowings are classified as current liabilities unless the Group has an unconditional
right to defer settlement of the liability for at least 12 months after the reporting date.
Lease liabilities
The lease agreements do not impose any covenants, and leased assets may not be
used as security for borrowing purposes.
Lease liabilities have been measured at the present value of the remaining lease
payments, discounted using a discount rate derived from the incremental borrowing
rate for each relevant territory on 1 April 2019 when the interest rate implicit in the
lease was not readily available. Leases that commenced after 1 April 2019 use an
incremental borrowing rate that was applicable on commencement date. Incremental
borrowing rates applied to lease liabilities range between 2% - 38%, with a weighted
average rate of 6.4% (2023: 5.3%).
Extension and termination options
Some property leases contain an extension option exercisable by the Group. At the
commencement of a lease, the Group assesses whether it is reasonably certain an
extension option will be exercised. The assessment is reviewed if a significant event
or a significant change in circumstances occurs which affects this assessment and
that is within the control of the Group. The extension options are only exercisable
by the Group and not by the lessor. Where it is reasonably certain the extension
will be exercised, that extension period and related costs are recognised on the
balance sheet.
Short-term and low-value leases
Payments associated with short-term leases and leases of low-value assets
are recognised on a straight-line basis as an expense in the income statement.
Short-term leases are leases with a lease term of 12 months or less. Low-value
leases predominantly relate to computer equipment.
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024139
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
12. INTEREST-BEARING LIABILITIES (CONTINUED)
Borrowing facilities
Borrowings have been aged in accordance with the expiry dates of the facilities as there
are no required principal payments before the expiry of each facility. At year end the
weighted average interest rate for borrowings is 6.5% (2023: 4.3%).
Key lenders to the Group are Debt Certificate Holders under the Negative Pledge Deed.
The negative pledge includes the covenant that security can be given only in limited
circumstances.
The companies in the Group providing the undertakings under the Negative Pledge Deed
are:
Fisher & Paykel Healthcare Corporation Limited
Fisher & Paykel Healthcare Limited
Fisher & Paykel Healthcare Treasury Limited
Fisher & Paykel Healthcare Properties Limited
The principal covenants of the negative pledge are that:
(i) the interest cover ratio for the Group shall not be less than 3 times earnings before
interest, tax, depreciation and amortisation (EBITDA);
(ii) the net tangible assets of the Group shall not be less than $200 million; and
(iii) the total tangible assets of the Guaranteeing Group shall constitute at least 80%
of the total tangible assets of the Group.
There have been no breaches of debt covenants for the current or prior period.
The Company had total available committed debt funding of $646.8 million as
at 31 March 2024, of which $544.3 million was undrawn. As at 31 March 2024,
the weighted average maturity of committed borrowing facilities was 2.7 years.
2023
NZ$M
2024
NZ$M
Unused lines of credit
Uncommitted borrowing and bank overdraft facilities 90.0 82.0
Committed borrowing facilities 624.5 544.3
714.5 626.3
140
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
13. TRADE AND OTHER PAYABLES
2023
NZ$M
2024
NZ$M
CURRENT
Trade payables 43.0 32.4
Employee entitlements 94.5 108.6
Other payables and accruals 82.2 78.9
219.7 219.9
NON-CURRENT
Employee entitlements 18.1 18.1
Other payables and accruals 3.5 3.3
21.6 21.4
Trade and other payables represent liabilities for goods and services provided to the
Group prior to the end of the financial period which are unpaid. The amounts are
unsecured and are usually paid within 60 days of recognition. Trade payables are
recognised initially at fair value and subsequently measured at amortised cost using
the effective interest method.
Refer to Note 18 for further details of employee entitlements and benefits.
14. PROVISIONS
2023
NZ$M
Warranty
2024
NZ$M
Warranty
2024
NZ$M
Recall
2024
NZ$M
Total
Warranty and recall provision
CURRENT
Balance at beginning of
the year
26.3 20.9 – 20.9
Current year provision (3.0) (7.0) 20.0 13.0
Warranty expenses incurred (2.4) (2.9) – (2.9)
Balance at end of the year 20.9 11.0 20.0 31.0
NON-CURRENT
Balance at beginning of
the year
11.1 7.3 – 7.3
Current year provision (3.8) (1.0) – (1.0)
Balance at end of the year 7.3 6.3 – 6.3
Provisions are recognised where the Group has a present legal or constructive
obligation as a result of past events and it is more likely than not that an outflow
of resources will be required to settle the obligation, and the amount can be
reliably estimated.
Warranty and Product Recall
Provision for warranty covers the obligations for the unexpired warranty periods for
products, based on recent historical costs incurred on warranty exposure. Typical
warranty terms are 1 to 2 years for parts and/or labour.
The actual future warranty claims experienced by the Group may be different to that
of the past. Factors that could impact future warranty claims include the success of
the Group’s quality system, as well as future parts and labour costs. Where the Group
is aware of specific product warranty issues including associated recall costs these are
included in the provision.
Management has made judgements, estimates and assumptions related to probable
costs arising from the recall which affect the provision and total expenses. Actual
outcomes may differ from these estimates as information is identified.
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024141
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
15. SHARE CAPITAL
2023
NZ$M
2024
NZ$M
Share capital at beginning of the year 266.3 307.0
Issue of share capital under dividend reinvestment plan 35.3 92.6
Issue of share capital under employee share plans 5.4 9.5
Share capital at end of the year 307.0 409.1
Less treasury shares (i) (3.3) (5.1)
303.7 404.0
Number of issued shares
Number of shares on issue at beginning of the year 577,405,878 579,356,576
Shares issued:
Dividend reinvestment plan 1,630,648 3,960,480
Employee share purchase schemes 80,532 76,683
Employee share based payments plans 239,518 569,943
Number of shares on issue at end of the year 579,356,576 583,963,682
Less treasury shares (i) (137,282) (419,172)
579,219,294 583,544,510
Incremental costs directly attributable to the issue of new shares, rights or options are
shown in equity as a deduction, net of taxation, from the proceeds.
When shares are acquired by a member of the Group, the amount of consideration
paid is recognised directly in equity. These shares are classified as treasury shares and
presented as a deduction from share capital until the ownership transfers to a holder
outside the Group. When treasury shares are subsequently reissued under employee
share plans the cost of treasury shares is reversed and the realised gain or loss on sale
or reissue, net of any directly attributable incremental transaction costs, is recognised
within share capital.
All shares are fully paid. All ordinary shares rank equally with one vote attached to each
fully paid ordinary share.
(i) Treasury shares are shares held and controlled by Fisher & Paykel Healthcare Employee
Share Purchase Trustee Limited under the Employee Share Purchase Scheme by Fisher
& Paykel Healthcare Employee Share Trust.
16. EARNINGS PER SHARE
2023
NZ$M
2024
NZ$M
Profit after tax 250.3 132.6
Weighted average number of ordinary shares 578,140,116 581,972,373
Adjustment for share options, PSRs and ESRs 3,490,803 4,206,561
Weighted average number of ordinary shares for
diluted earnings per share 581,630,919 586,178,934
Basic earnings per share (cents per share) 43.3 cps22.8 cps
Diluted earnings per share (cents per share) 43.0 cps22.6 cps
Basic earnings per share is calculated by dividing the profit after tax by the weighted
average number of ordinary shares outstanding during the year.
Diluted earnings per share is calculated by adjusting the weighted average number
of ordinary shares outstanding to assume conversion of all dilutive potential ordinary
shares. Options, Performance Share Rights (PSRs) and Employee Share Rights (ESRs)
are convertible into the Company’s shares, and are therefore considered dilutive
securities for diluted earnings per share.
142
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
17. RESERVES AND DIVIDENDS
2023
NZ$M
2024
NZ$M
Hedging reserve 55.7 42.9
Asset revaluation reserve 169.7 187.0
Employee share based payment reserve 22.4 26.8
Foreign currency translation reserve 1.4 3.4
Total reserves 249.2 260.1
Nature and purpose of reserves
Hedging reserve
This reserve is used to record unrealised gains or losses on hedging instruments that are
recognised directly in equity and the cumulative net change in the time value on currency
options which are excluded from hedge designations of foreign currency risk.
Amounts are recycled to the income statement when the associated hedged transactions
affect the income statement.
Asset revaluation reserve
The asset revaluation reserve relates to the revaluation of land. For details refer to Note 9.
Share based payment reserve
This reserve is used to recognise the fair value of shares, options, PSRs and ESRs granted
but not exercised or lapsed. Tax deductions in excess of the cumulative share based
payment expense are recognised in equity.
Amounts are transferred to share capital (including income tax benefits) when the vested
shares, options, PSRs or ESRs are exercised or lapse.
Foreign currency translation reserve
The foreign currency translation reserve contains foreign exchange differences arising on
consolidation of assets and liabilities of overseas entities with a functional currency other
than NZD.
Dividends
All dividends are recognised as distributions to shareholders.
During the year, supplementary dividends of $26.2 million were paid to non-resident
shareholders (2023: $24.7 million), for which the Group received an equivalent foreign
investor tax credit entitlement. The foreign investor tax credit entitlement is included in
income taxes paid within the statement of cash flows.
Cents
per share NZ$M
Dividends
2022 final 22.50 129.9
2023 interim 17.50 101.1
31 March 2023 40.00 231.0
2023 final 23.00 133.3
2024 interim 18.00 104.8
31 March 2024 41.00 238.1
Subsequent event – dividend declared
On 28 May 2024 the Directors approved the payment of a fully imputed 2024
final dividend of $137.2 million (23.5 cents per share) to be paid on 10 July 2024. A
supplementary dividend of 4.1471 cents per share was also approved for eligible non-
resident shareholders.
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024143
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
18. EMPLOYEE EXPENSES
Employee expenses total $692.7 million (2023: $607.8 million).
2024
NZ$M
681.9
10.8
2023
NZ$M
9.0
598.8
Wages and
salaries
Share based
benefits
Wages and salaries
Wages and salaries includes non-monetary benefits, annual leave, long service leave
and contributions to superannuation plans.
Liabilities for wages and salaries, including non-monetary benefits, annual leave,
long service leave and accumulating sick leave are recognised within employee
entitlements in trade and other payables. These are measured at the amounts
expected to be paid when the liabilities are settled in respect of employees’ services
up to the reporting date.
For the liabilities for long service leave liabilities, consideration is given to expected
future wage and salary levels, experience of employee departures and periods of
service. Expected future payments are discounted using market yields at the reporting
date on national government bonds with terms to maturity and currency that match,
as closely as possible, the estimated future cash outflows.
Liabilities for non-accumulating sick leave are recognised when the leave is taken and
measured at the rates paid or payable.
Equity settled share based payments
The fair value (at grant date) of shares, options, PSRs and ESRs granted to employees
is recognised as an employee expense in the income statement over the vesting
period with a corresponding increase in the employee share based payment reserve.
When shares, options, PSRs or ESRs are exercised, the amount in the share based
payment reserve relating to those instruments, together with the option exercise
price paid by the employee, is transferred to share capital. When any shares, options,
PSRs or ESRs lapse, the amount in the share based payment reserve relating to those
shares, options, PSRs or ESRs is also transferred to share capital.
a) Key management and director compensation
2023
NZ$000
2024
NZ$000
Salary and other short-term benefits 8,527 10,201
Share based benefits 2,879 4,030
Directors fees 1,390 1,515
12,796 15,746
Key management includes the Chief Executive Officer and senior executives reporting
directly to the Chief Executive Officer.
The table excludes any dividends received on the Company’s shares held by the Directors
or key management.
144
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
18. EMPLOYEE EXPENSES (CONTINUED)
b) Employee share based compensation
The Company grants options and share rights to certain employees under a number of
Long Term Variable Remuneration Plans as follows:
• 2022 Share Option Plan and the 2022 Performance Share Rights Plan (from 1 April 2022)
• 2019 Share Option Plan and the 2019 Performance Share Rights Plan (from 1 April 2019
to 31 March 2022)
• Fisher & Paykel Healthcare Employee Share Rights Plan
Vesting of all schemes is subject to the employee still being in service at date of vesting.
No amounts are payable for the grant of any options or share rights. Options, PSRs and
ESRs granted to employees have no voting rights until they have been exercised and
ordinary shares issued.
(i) Share option plans
Under the 2019 and 2022 Share Option Plans, one option gives the employee the right
to acquire one ordinary share in the Company. Options vest on the anniversary date
of the grant as long as the FPH share price on the NZX on that date has exceeded the
“escalated price”. The escalated price is determined at the anniversary of the grant date
and is calculated by:
• increasing the last calculated escalated price (which, as at the grant date, will be the
exercise price of the option) by a percentage amount determined by the Board to
represent the Company’s cost of capital; and
• reducing the resulting figure by the amount of any dividend paid by the Company
in respect of a share in the 12 month period immediately preceding that anniversary.
Options under the 2022 plan vest on the third anniversary date if the vesting condition
is met. Options under the 2019 plan vest on the third, fourth or fifth anniversary date
if the vesting condition is met.
(ii) Performance share rights plans
Under the Performance Share Rights Plans, one share right gives the employee the
potential to exercise a share right for an ordinary share in the Company at no cost.
PSRs will fully vest if the Company’s gross total shareholder return (TSR) performance
exceeds the performance of the Dow Jones US Select Medical Equipment Total Return
Index (DJSMDQT) in NZD by 10% or more over the same period. PSRs partially vest if
the company’s TSR exceeds the DJSMDQT by less than 10%.
The 2022 plan is a 3 year scheme and the Company’s TSR will be calculated and compared
against the Index return of the third anniversary of the grant. The 2019 plan is a 5 year
scheme, with the potential for rights to fully vest on the third and fourth anniversary
of the grant date.
(iii) Employee share rights plan
The Employee Share Rights (ESR) Plan entitles certain New Zealand and Australian
employees to be issued ordinary shares in the Company. ESRs automatically vest on the
third anniversary of their grant date at no cost to the employee. For each ESR that vests,
one ordinary share will be issued.
(iv) Other Employee share and stock purchase plans
Employee Share Purchase Plan: New Zealand and Australian full time employees are
eligible, after a qualifying period, to participate in this plan. Shares are issued up to
the value of $2,000, with a discount of up to $500 per employee. Loans are provided
to employees for the purchase and repaid over the vesting period. No interest is charged
on the loans. The qualifying period between grant and vesting date is 3 years. At 31 March
2024 the total receivable owing from employees was $2.8 million (2023: $1.8 million).
Employee Stock Purchase Plan: North American employees working more than 20 hours
per week, in accordance with section 423 of the US Internal Revenue Code as amended,
are eligible to participate in this plan. Shares under this Plan are issued at a discount of
15%, are allocated to employees at the time of issue and vest immediately. Shares issued
under this plan in 2024 totalled 76,683 shares (2023: 80,532).
Measurement
The fair value of share options and PSRs is independently determined using a Monte Carlo
simulation valuation methodology. The fair value of ESRs is independently determined
using a discounted dividend approach. The key inputs and assumptions are included on
the following page.
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024145
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
18. EMPLOYEE EXPENSES (CONTINUED)
Movements in the number of options, PSRs and ESRs outstanding and their exercise prices are as follows:
20232024
Options
Performance
Share Rights
Employee
Share RightsOptions
Performance
Share Rights
Employee
Share Rights
Number outstanding
As at beginning of the year 2,091,774 542,839 254,918 2,674,761 931,229 293,687
Granted during the year 914,977 403,282 163,032 920,620 400,683 173,829
Exercised during the year (287,228) – (116,381) (905,423) – (55,223)
Lapsed during the year (44,762) (14,892) (7,882) (51,441) (19,583) (21,816)
As at end of the year 2,674,761 931,229 293,687 2,638,517 1,312,329 390,477
Exercisable at year end 135,221 – – – – –
Number of employees holding employee share options, PSRs and ESRs 220 216 396 237 241 435
Weighted average exercise price $23.40 – – $25.13 – –
Weighted average remaining contractual life (months) 29 28 26 27 21 20
Fair value of share options or rights granted during the year (NZ$M) 3.9 3.9 3.1 4.7 4.7 3.7
Fair value of share options or rights granted during the year ($ per share) $4.31 $9.78 $18.90 $5.10 $11.72 $21.40
Key inputs and assumptions used in fair value of grants during the year
Share price at grant date $19.20 $19.20 $19.20 $21.55 $21.55 $21.55
Contractual life (years) 3 3 3 3 3 3
Exercise price $19.63 Nil Nil $21.96 Nil Nil
Expected volatility (i) 32.8%32.8%n/a32.5%32.5%n/a
Expected dividend yield 2.02%2.02%2.02%1.83%1.83%1.83%
Cost of equity 9.7% n/a 9.7%10.5% n/a 10.5%
5 year NZD risk free rate 3.83%3.83%n/a5.18%5.18%n/a
5 year USD risk free rate n/a3.54%n/an/a4.65%n/a
NZD/USD exchange rate of grant date n/a0.6100n/an/a0.5877n/a
Expected NZD/USD volatility n/a11.20%n/an/a11.60%n/a
Expected DJSMDQT index volatility n/a19.70%n/an/a16.00%n/a
(i) The expected share price volatility is derived by analysing the historical volatility over the most recent historical period corresponding to the term of the option or PSR.
146
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
19. CONTINGENT LIABILITIES
Contingent liabilities are subject to uncertainty or cannot be reliably measured and
are not provided for. Disclosures as to the nature of any contingent liabilities are set
out below. Judgements and estimates are applied to determine the probability that an
outflow of resources will be required to settle an obligation. These are made based on
a review of the facts and circumstances surrounding the event and advice from both
internal and external parties.
Periodically the Group is party to litigation including product liability and patent claims.
The Directors are unaware of the existence of any claim or contingencies that would have
a material impact on the financial statements.
20. COMMITMENTS
2023
NZ$M
2024
NZ$M
Capital expenditure commitments contracted for but not
recognised as at the reporting date:
Within one year 58.4 21.6
Between one and two years 24.0 43.4
Between two and five years – 15.0
82.4 80.0
The commitments above as at 31 March 2023 excluded the conditional commitment of
$247.5 million payable for the second New Zealand campus in Karaka. As of 31 March 2024,
the commitments for Karaka land purchase is $58.0 million.
21. FINANCIAL RISK MANAGEMENT
The Group’s activities expose it to a variety of financial risks: market risk (including
currency risk and interest rate risk), credit risk and liquidity risk.
The Board has approved procedures and guidelines that identify and evaluate risks and
authorise various financial instruments to manage financial risks. These procedures and
guidelines are reviewed regularly.
a. Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates,
interest rates and prices will affect profit or the value of financial instruments.
The objective of market risk management is to manage and control market risk exposures
through the use of various financial instruments in accordance with the Group’s treasury
procedures.
(i) Foreign exchange risk
Foreign exchange risk arises when future transactions and recognised assets and liabilities
are denominated in a currency that is not the entity’s functional currency.
The Group operates internationally and is exposed to foreign exchange risk arising from
various currency exposures, primarily US dollar (USD), Euro (EUR), Japanese yen (JPY)
and Mexican peso (MXN).
Foreign exchange risk is hedged in accordance with the Group’s treasury procedures.
The Group enters into foreign currency option contracts and forward foreign currency
contracts within procedure parameters to hedge the foreign exchange risk associated
with anticipated sales or costs. The terms of the foreign currency option contracts and
the forward foreign currency contracts generally do not exceed 5 years, but may have
terms of up to 10 years with Board approval.
Foreign exchange contracts and options in relation to sales are designated at the
Group level as hedges of foreign exchange risk on specific forecast foreign currency
denominated sales.
Balance sheet foreign exchange risk arising from net assets held by the Group may be
hedged either by debt in the relevant currency, foreign currency swaps, options and
forward foreign currency contracts.
(ii) Interest rate risk
The Group’s main interest rate risk arises from floating rate borrowings drawn under bank
debt facilities. When deemed appropriate, the Group manages floating interest rate risk
by using floating-to-fixed interest rate swaps and interest rate options within procedure
parameters. Interest rate swaps and options are accounted for as cash flow hedges.
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024147
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
21. FINANCIAL RISK MANAGEMENT (CONTINUED)
The carrying amounts of significant non-derivative financial assets and liabilities are denominated in the following currencies:
NZD
NZ$M
USD
NZ$M
EUR
NZ$M
JPY
NZ$M
AUD
NZ$M
CAD
NZ$M
GBP
NZ$M
MXN
NZ$M
Other
NZ$M
Total
NZ$M
2023
Cash 60.1 13.6 9.1 – 4.9 1.1 0.8 5.2 26.2 121.0
Trade receivables 1.6 85.2 44.7 17.2 5.8 8.8 5.6 2.2 13.4 184.5
Trade and other payables (60.3) (25.6) (13.3) (1.0) (3.2) (1.2) (4.1) (12.1) (7.9) (128.7)
Bank overdraft – – (2.6) (0.7) (0.9) – – – – (4.2)
Lease liabilities (6.3) (31.6) (9.3) (1.4) (2.8) (1.2) (3.7) (0.8) (5.4) (62.5)
Borrowings (10.0) (63.6) – – (3.5) (2.0) – – – (79.1)
(14.9) (22.0) 28.6 14.1 0.3 5.5 (1.4) (5.5) 26.3 31.0
2024
Cash 3.2 12.1 8.3 2.7 2.4 1.5 1.7 9.4 40.7 82.0
Trade receivables 1.6 102.4 58.2 17.4 7.8 9.4 10.4 1.9 13.9 223.0
Trade and other payables (50.6) (25.9) (15.5) (1.5) (3.2) (1.2) (4.8) (6.1) (5.8) (114.6)
Bank overdraft – – – – – – – – (1.1) (1.1)
Lease liabilities (5.9) (45.0) (8.4) (0.7) (2.4) (1.0) (3.2) (1.0) (7.3) (74.9)
Borrowings (40.6) (66.8) – – (3.6) (2.1) – – – (113.1)
(92.3) (23.2) 42.6 17.9 1.0 6.6 4.1 4.2 40.4 1.3
148
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
21. FINANCIAL RISK MANAGEMENT (CONTINUED)
a. Market risk (continued)
Summarised sensitivity analysis
The following table summarises the sensitivity of the Group’s financial assets and financial
liabilities to interest rate risk and foreign exchange risk.
A sensitivity of +/-10% for foreign exchange risk has been selected. The Group believes
that an overall sensitivity of +/-10% is reasonably possible given the exchange rate volatility
observed on a historical basis. A sensitivity of +/-1% has been selected for interest rate risk.
This sensitivity is based on reasonably possible changes over a financial year using the
observed range of historical data.
All variables other than the applicable interest rates and exchange rates are held constant.
20232024
NZ$M NZ$M NZ$M NZ$M
Interest rate change -1%+1%-1%+1%
Impact on profit after tax (0.2) 0.2 0.6 (0.6)
Impact on hedging reserves
(within equity) (0.4) 0.4 – –
(0.6) 0.6 0.6 (0.6)
Foreign exchange rate change-10%+10%-10%+10%
Impact on profit after tax 4.2 (4.6) 14.8 (13.8)
Impact on hedging reserves
(within equity) (189.6) 154.7 (213.0) 174.3
(185.4) 150.1 (198.2) 160.5
Fair value estimation
NZ IFRS 13 for financial assets and liabilities measured at fair value requires disclosure
of the fair value measurements by level from the following fair value hierarchy:
• Level 1 – Quoted price (unadjusted) in active markets for identical assets and liabilities;
• Level 2 – Inputs, other than quoted price included within level 1, that are observable
for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived
from prices);
• Level 3 – Inputs for assets and liabilities that are not based on observable market data
(that is, unobservable inputs).
Financial Instruments
All the Group’s financial instruments held at fair value have been measured at the fair value
measurement hierarchy of level 2 (2023: level 2).
The fair value of derivative instruments designated in a hedging relationship is determined
using the following valuation techniques:
• Foreign currency forward exchange contracts have been fair valued using quoted
forward exchange rates and discounted using yield curves from quoted interest rates
that match the maturity dates of the contracts.
• Foreign currency option contracts have been fair valued using observable option
volatilities, and quoted forward exchange and interest rates that match the maturity
dates of the contracts.
• Interest rate swaps are fair valued by discounting the future interest and principal cash
flows using current market interest rates that match the maturity dates of the contracts.
These valuation techniques maximise the use of observable market data where it is
available and rely as little as possible on entity-specific estimates.
Land
Refer to Note 9 for further information about land that is measured at fair value, including
a summary of the valuation techniques used.
Other
All financial assets other than derivatives are measured at amortised cost including
short-term investments. All financial liabilities other than derivatives are classified as
measured at amortised cost. Financial liabilities measured at amortised cost are fair
valued using the contractual cash flows. The carrying value of financial assets and liabilities
approximates their fair value. In considering the fair value of interest-bearing assets and
liabilities, the estimated future interest rates approximate the discount rates used in a fair
value assessment.
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024149
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
21. FINANCIAL RISK MANAGEMENT (CONTINUED)
b. Liquidity risk
Management monitors rolling forecasts of the Group’s liquidity position on the basis of expected cash flows. The table below sets out the contractual, undiscounted cash flows for non-
derivative financial liabilities and derivative financial instruments.
< 1 year
NZ$M
1–2 years
NZ$M
2–5 years
NZ$M
5+ years
NZ$M
Contractual
cash flows
NZ$M
Consolidated
Balance Sheet
NZ$M
2023
Bank overdrafts 4.2–––4.24.2
Trade and other payables 128.7–––128.7128.7
Borrowings 3.465.915.9–85.279.1
Lease liabilities (i) 17.313.222.87.060.362.5
Total non-derivative financial liabilities 153.679.138.77.0278.4274.5
Foreign currency forward exchange contracts 11.826.535.313.386.976.3
Interest rate derivative instruments net inflows (outflows) (ii) 0.90.30.1–1.30.8
Total derivative financial instruments – assets12.726.835.413.388.277.1
2024
Bank overdrafts 1.1–––1.11.1
Trade and other payables 114.6–––114.6114.6
Borrowings 82.36.132.12.1122.6113.1
Lease liabilities (i) 17.914.831.625.890.174.9
Total non-derivative financial liabilities 215.920.963.727.9328.4303.7
Foreign currency forward exchange contracts17.46.324.021.168.859.0
Interest rate derivative instruments net inflows (outflows) (ii) ––––––
Total derivative financial instruments – assets 17.46.324.021.168.859.0
(i) Contractual cash flows on leases exclude extension options.
(ii) Interest rate swaps derivative cash flows are estimated using forward interest rates at reporting date.
150
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
21. FINANCIAL RISK MANAGEMENT (CONTINUED)
c. Credit risk
The Group is exposed to credit risk in respect of trade receivables, financial instruments,
cash and cash equivalents and short-term investments in the normal course of business.
The maximum exposure to credit risk is represented by the carrying value of these
financial assets. Credit risk is managed on a Group basis with no significant concentration
of credit risk.
The Group has policies in place to ensure that sales of products and services are made
to customers with an appropriate credit history. There are no significant trade receivable
balances relating to customers who have previously defaulted on amounts due to
the Group.
Derivative counterparties, cash transactions, cash at banks, and short-term investments
are limited to high credit quality financial institutions. Over 73% of cash and short-term
investments (2023: 80%) is held with counterparties with credit rating of Standard and
Poors’ A- and above.
The Group’s exposure to credit risk from derivative financial instruments is limited because
it does not expect non-performance of the obligation contained therein due to the credit
rating of the financial institutions concerned.
22. SIGNIFICANT EVENTS AFTER BALANCE DATE
Other than the dividends disclosed in Note 17 there are no other significant events after
balance date.
23. OTHER MATERIAL ACCOUNTING POLICIES
a. Changes to accounting policies
There have been no changes in accounting policies.
b. Impairment of non-financial assets
Assets that have an indefinite useful life or are under development are not subject
to amortisation and are tested annually for impairment. Assets that are subject
to depreciation or amortisation are reviewed for impairment whenever events or
changes in circumstances indicate that the carrying amount may not be recoverable.
The recoverable amount is the higher of an asset’s fair value less costs of disposal,
and value in use. For the purposes of assessing impairment, assets are grouped
at the lowest levels for which there are separately identifiable cash flows (cash
generating units).
c. Goods and Services Tax (GST)
The income statement has been prepared so that all components are stated exclusive
of GST. All items in the balance sheet are stated net of GST, with the exception of
trade receivables and payables, which include GST invoiced.
d. Cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial
institutions, other short-term highly liquid investments with maturities of three
months or less that are readily convertible to known amounts of cash and which
are subject to an insignificant risk of changes in value, and bank overdrafts.
e. Research and development
Research expenditure is expensed as incurred.
Development costs that are directly attributable to the design and testing of
identifiable and unique products controlled by the Group are recognised as intangible
assets only when all the following criteria are met:
• it is technically feasible to complete the product so that it will be available for
use or sale;
• management intends to complete the product and use or sell it;
• there is an ability to use or sell the product;
• it can be demonstrated that the product will generate future economic benefits;
• adequate technical, financial and other resources to complete the development
and to use or sell the product are available and;
• the expenditure attributable to the product during its development can be reliably
measured and is material.
Directly attributable costs capitalised as part of the product would include employee
costs and an appropriate portion of relevant overheads. Other development
expenditures that do not meet these criteria are recognised as an expense as
incurred. Development costs previously recognised as an expense are not recognised
as an asset in a subsequent period. Development costs recognised as an asset are
amortised over their estimated useful lives.
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024151
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2024
INDEPENDENT AUDITOR’S REPORT
To the shareholders of Fisher & Paykel Healthcare Corporation Limited
OUR OPINION
In our opinion, the accompanying consolidated financial statements of Fisher & Paykel
Healthcare Corporation Limited (the Company), including its subsidiaries (the Group),
present fairly, in all material respects, the financial position of the Group as at 31 March
2024, its financial performance and its cash flows for the year then ended in accordance
with New Zealand Equivalents to International Financial Reporting Standards (NZ
IFRS) and International Financial Reporting Standards Accounting Standards (IFRS
Accounting Standards).
What we have audited
The Group’s consolidated financial statements comprise:
• the consolidated balance sheet as at 31 March 2024;
• the consolidated income statement for the year then ended;
• the consolidated statement of comprehensive income for the year then ended;
• the consolidated statement of changes in equity for the year then ended;
• the consolidated statement of cash flows for the year then ended; and
• the notes to the consolidated financial statements, comprising material accounting
policy information and other explanatory information.
BASIS FOR OPINION
We conducted our audit in accordance with International Standards on Auditing
(New Zealand) (ISAs (NZ)) and International Standards on Auditing (ISAs).
Our responsibilities under those standards are further described in the Auditor’s
responsibilities for the audit of the consolidated financial statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Independence
We are independent of the Group in accordance with Professional and Ethical
Standard 1 International Code of Ethics for Assurance Practitioners (including International
Independence Standards) (New Zealand) (PES 1) issued by the New Zealand Auditing
and Assurance Standards Board and the International Code of Ethics for Professional
Accountants (including International Independence Standards) issued by the International
Ethics Standards Board for Accountants (IESBA Code), and we have fulfilled our other
ethical responsibilities in accordance with these requirements.
Our firm carries out other services for the Group in the areas of providing market survey
data relating to executive remuneration levels, regulatory tax compliance procedures in
Mexico, and other assurance services in relation to compliance with constant currency
disclosures. The provision of these other services has not impaired our independence as
auditor of the Group.
152
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
KEY AUDIT MATTERS
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated financial statements of the current year.
These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
Description of the key audit matterHow our audit addressed the key audit matter
Revenue recognition
The Group’s revenue primarily consists of the sale of products. Operating revenue
totalled $1,742.8 million in the year ended 31 March 2024 as outlined in Note 4.
In determining the appropriate recognition of revenue, management has considered
the following characteristics of the sale of products:
• products are sold to customers in multiple territories with varying sales contract
terms and conditions; and
• in certain markets, sales are made to distributors and include rebate arrangements.
Management has concluded that:
• revenue is primarily derived from the satisfaction of a single performance
obligation for each contract which is the sale of products; and
• control of product transfers to the customer/distributor at the same time as legal
title passes.
Given the conclusions above and the volume of revenue recognised, we have given
significant audit focus and attention to the recognition of revenue.
On a sample basis for major operating subsidiaries:
• we examined contracts with customers to validate that management’s conclusion was
appropriate in relation to the determination of performance obligations and when
control transfers; and
• obtained an understanding of rebate, payment and pricing arrangements that support
the recognition of a sale on transfer of control to the distributor.
We completed detailed audit procedures over revenue including:
• obtaining an understanding of systems, processes and controls and evaluating and
testing certain controls in place over the recording of revenue in the appropriate period;
• for a targeted operating subsidiary, utilising data assurance techniques to match
invoices issued to cash received, rebates or amounts receivable at balance date;
• for a sample of revenue transactions in the other major operating subsidiaries, we
examined invoices issued to customers, shipping documentation or cash remittances,
where paid;
• for a sample of transactions within accounts receivable at balance date, we obtained
either confirmation of the amount owing from the customer, or performed alternative
procedures; and
• assessing the risk of revenue cut-off and performing testing where necessary.
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024153
INDEPENDENT AUDITOR’S REPORT
Description of the key audit matterHow our audit addressed the key audit matter
Inventory valuation
At 31 March 2024, the Group held inventories of $320.4 million, net of provision for
inventory write downs of $79.1 million.
As outlined in note 8, inventories are stated at the lower of cost or net realisable value.
The Group holds inventory in a number of locations globally. This inventory is adjusted
to cost at year end by the elimination of inter-group margin.
Management applies judgment in determining inventory valuation, in particular the
level of provisions for inventory which is excess to production requirements, slow
moving, or obsolete in nature.
Given the value and quantum of inventory and the estimate and judgements
described above, the valuation of inventory required significant audit attention and is
a key audit matter.
Our audit procedures included:
• obtaining an understanding of systems, processes and controls and evaluating and
testing certain controls in place over inventory;
• on a sample basis, testing materials and finished products costing to supporting
documentation;
• understanding and assessing the reasonableness of the allocation of manufacturing
costs;
• on a sample basis, testing the accuracy of the Group’s global inventory being
recognised using the appropriate costing, including the elimination of inter-group
margin;
• performing analytical procedures on selected inventory provisions to assess their
reasonableness, including testing inventory report reliability and consistency against
the provision recognised;
• assessing production and sales forecasting to support certain inventory provisions
recognised; and
• reviewing the appropriateness of disclosures in the consolidated financial statements.
Karaka land valuation
At 31 March 2024, the Group held land of $423.6 million. In September 2022, the
Group announced an agreement to purchase land in Karaka for a second New Zealand
campus for development in line with the Group’s strategy. The purchase conditions
were satisfied and the land was acquired in May 2023. As at 31 March 2024, the fair
value of the Karaka development land was $122.0 million.
As outlined in note 9, the Group’s accounting policy requires land to be measured
at fair value with at least a triennial valuation by external valuers. In this financial
year, as a result of changes to property market conditions, external valuations were
obtained for all land held by the Group. In respect of the Karaka development land,
the Group recognised a land revaluation decrease through the consolidated income
statement of $98.1 million.
The existence of significant estimation uncertainty and the quantum of the revaluation
decrease recognised in the consolidated income statement is why we have given
specific audit focus and attention to this area.
Our audit procedures included:
• obtaining and reviewing the valuation report from the external valuer for the
Karaka land;
• holding discussions with the valuer to understand the methodologies, key assumptions
applied and confirmed that the valuation was performed in accordance with the
appropriate accounting and valuation standards;
• assessing the valuer’s qualifications, expertise and their objectivity;
• engaging our in-house real estate valuation expert to critique and challenge the
methodologies used, work performed and key assumptions applied by the valuer; and
• reviewing the appropriateness of the disclosures in the consolidated financial
statements.
154
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
INDEPENDENT AUDITOR’S REPORT
OUR AUDIT APPROACH
Overview
Overall group materiality: $16.3 million, which represents
approximately 5% of profit before tax and revaluation of land
recognised in the consolidated income statement.
We chose this measure as the benchmark because, in our view,
it is the benchmark against which the performance of the
Group is measured by users.
Our Group audit scoping focussed on eight subsidiaries which
were selected based on their significant financial contribution to
the Group’s revenue or profit before tax. We performed specified
audit and analytical procedures over the other subsidiaries.
As reported above, we have three key audit matters, being:
• Revenue recognition;
• Inventory valuation; and
• Karaka land valuation.
As part of designing our audit, we determined materiality and assessed the risks
of material misstatement in the consolidated financial statements. In particular, we
considered where management made subjective judgements; for example, in respect
of significant accounting estimates that involved making assumptions and considering
future events that are inherently uncertain. As in all of our audits, we also addressed
the risk of management override of internal controls, including among other matters,
consideration of whether there was evidence of bias that represented a risk of material
misstatement due to fraud.
Materiality
The scope of our audit was influenced by our application of materiality. An audit is
designed to obtain reasonable assurance about whether the consolidated financial
statements are free from material misstatement. Misstatements may arise due to
fraud or error. They are considered material if, individually or in aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis
of the consolidated financial statements.
Based on our professional judgement, we determined certain quantitative thresholds
for materiality, including the overall Group materiality for the consolidated financial
statements as a whole as set out above. These, together with qualitative considerations,
helped us to determine the scope of our audit, the nature, timing and extent of our
audit procedures and to evaluate the effect of misstatements, both individually and in
aggregate, on the consolidated financial statements as a whole.
How we tailored our group audit scope
We tailored the scope of our audit in order to perform sufficient work to enable us
to provide an opinion on the consolidated financial statements as a whole, taking into
account the structure of the Group, the accounting processes and controls, and the
industry in which the Group operates.
OTHER INFORMATION
The Directors are responsible for the other information. The other information comprises
the information included in the Annual Report, but does not include the consolidated
financial statements and our auditor’s report thereon.
Our opinion on the consolidated financial statements does not cover the other
information and we do not express any form of audit opinion or assurance conclusion
thereon.
In connection with our audit of the consolidated financial statements, our
responsibility is to read the other information and, in doing so, consider whether the
other information is materially inconsistent with the consolidated financial statements
or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior
to the date of this auditor’s report, we conclude that there is a material misstatement of
this other information, we are required to report that fact. We have nothing to report in
this regard.
Materiality
Group scoping
Key audit
matters
Section 42|2FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024155
INDEPENDENT AUDITOR’S REPORT
INDEPENDENT AUDITOR’S REPORT
RESPONSIBILITIES OF THE DIRECTORS FOR THE CONSOLIDATED
FINANCIAL STATEMENTS
The Directors are responsible, on behalf of the Company, for the preparation and fair
presentation of the consolidated financial statements in accordance with NZ IFRS and IFRS
Accounting Standards, and for such internal control as the Directors determine is necessary
to enable the preparation of consolidated financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the Directors are responsible for
assessing the Group’s ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis of accounting unless
the Directors either intend to liquidate the Group or to cease operations, or have no
realistic alternative but to do so.
AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE CONSOLIDATED
FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about whether the consolidated financial
statements, as a whole, are free from material misstatement, whether due to fraud or error,
and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs
(NZ) and ISAs will always detect a material misstatement when it exists. Misstatements can
arise from fraud or error and are considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the
basis of these consolidated financial statements.
A further description of our responsibilities for the audit of the consolidated financial
statements is located at the External Reporting Board’s website at:
https://www.xrb.govt.nz/assurance-standards/auditors-responsibilities/audit-report-1/
This description forms part of our auditor’s report.
WHO WE REPORT TO
This report is made solely to the Company’s shareholders, as a body. Our audit work has
been undertaken so that we might state those matters which we are required to state to
them in an auditor’s report and for no other purpose. To the fullest extent permitted by
law, we do not accept or assume responsibility to anyone other than the Company and the
Company’s shareholders, as a body, for our audit work, for this report or for the opinions
we have formed.
The engagement partner on the audit resulting in this independent auditor’s report is
Indumin Senaratne (Indy Sena).
For and on behalf of:
Chartered Accountants
28 May 2024 Auckland
156
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
Section 4 | FINANCIALS
Fisher & Paykel Healthcare | ANNUAL REPORT 2024157
158
Section 5 | APPENDICES
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
APPENDICES
5
Fisher & Paykel Healthcare | ANNUAL REPORT 2024159
FIVE YEAR SUMMARY
For the years ended 31 March
All figures in NZ$M (except as otherwise stated)
20202021202220232024
FINANCIAL
PERFORMANCE
Sales revenue 1,273.4 1,948.2 1,642.4 1,588.6 1,758.1
Foreign exchange gain (loss) on hedged sales (9.7)23.0 39.3 (7.5)(15.3)
Total operating revenue 1,263.7 1,971.2 1,681.7 1,581.1 1,742.8
Gross profit 835.8 1,245.6 1,052.7 938.4 1,044.4
Gross margin 66.1%63.2%62.6%59.4%59.9%
SG&A expenses (338.0)(396.6)(393.1)(431.9)(492.8)
R&D expenses (118.5)(136.7)(154.0)(174.3)(198.2)
Total operating expenses (456.5)(533.3)(547.1)(606.2)(691.0)
Operating profit 379.3 712.3 505.6 332.2 353.4
Operating margin 30.0%36.1%30.1%21.0%20.3%
Revaluation of land – – – – (98.1)
Profit before financing and tax 379.3 712.3 505.6 332.2 255.3
Net financing expense (8.8)5.9 (1.4)(4.2)(19.6)
Tax expense (83.2)(194.0)(127.3)(77.7)(103.1)
Profit after tax 287.3 524.2 376.9 250.3 132.6
Underlying profit after tax
(1)
287.3 524.2 376.9 250.3 264.4
Growth Rates
Reported
Revenue 18.1%56.0%-14.7%-6.0%10.2%
Gross profit 16.8%49.0%-15.5%-10.9%11.3%
R&D expenses 18.0%15.4%12.7%13.2%13.7%
Profit before tax 27.2%93.8%-29.8%-34.9%-28.1%
Profit after tax 37.3%82.5%-28.1%-33.6%-47.0%
Underlying profit after tax
(1)
37.3%82.5%-28.1%-33.6%5.6%
Growth Rates in
Constant Currency
(2)
Revenue 13.8%61.4%-13.7%-9.0%8.4%
Gross profit 11.3%57.4%-15.8%-14.4%10.2%
R&D expenses 18.0%15.4%12.7%13.2%13.7%
Profit before tax 20.3%103.6%-31.4%-39.9%-35.1%
Underlying profit before tax
(1)
20.3%103.6%-31.4%-39.9%6.9%
(1) Underlying profit has been presented excluding the impact of abnormal items occurring during the 2024 financial year. A reconciliation is set out on page 119.
(2) Constant Currency (CC) removes the impact of exchange rate movements. This approach is used to assess the company’s underlying comparative financial performance without any distortion from changes in foreign exchange rates.
A reconciliation for the most recent 2 years and basis of preparation is set out on page 122. The 2020 to 2023 growth rates in constant currency have been sourced from the 2023 annual report.
160
Section 5 | APPENDICES
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
FIVE YEAR SUMMARY (CONTINUED)
For the years ended 31 March
All figures in NZ$M (except as otherwise stated)
20202021202220232024
REVENUE
By Region and
product group
North America 571.2 825.7 665.1 683.8 806.1
Europe 365.4 633.8 468.1 427.6 477.3
Asia Pacific 273.3 348.4 438.8 399.0 368.9
Other 53.8 163.3 109.7 70.7 90.5
Hospital products 801.3 1,498.1 1,207.1 1,023.5 1,087.9
Homecare products 457.3 465.6 469.5 553.8 652.3
Core products subtotal 1,258.6 1,963.7 1,676.6 1,577.3 1,740.2
Distributed and other products 5.1 7.5 5.1 3.8 2.6
Total operating revenue 1,263.7 1,971.2 1,681.7 1,581.1 1,742.8
FINANCIAL
POSITION
Property, plant and equipment 735.3 882.1 957.8 1,148.2 1,340.0
Total assets 1,435.0 2,075.0 2,107.0 2,204.5 2,281.7
Total liabilities (461.2) (554.1) (427.3) (451.1) (522.6)
Shareholders’ equity 973.8 1,520.9 1,679.7 1,753.4 1,759.1
Return on assets (%) 28.1%40.9%24.1%15.2%10.5%
Return on equity (%) 39.3%57.6%31.5%19.1%13.4%
Net debt / (cash) (including short-term investments) (42.2) (302.9) (221.6) (37.7) 32.2
Gearing ratio
(1)
-4.3%-27.2%-16.3%-2.3%1.8%
DIVIDENDS AND
EARNINGS PER
SHARE (CENTS
PER SHARE)
Basic shares outstanding at 31 March 574,570,603 576,412,532 577,405,878 579,356,576 583,963,682
Interim 12.0016.0017.0017.5018.00
Final
(2)
15.5022.0022.5023.0023.50
Total ordinary dividends 27.5038.0039.5040.5041.50
Basic earnings per share 50.091.165.343.322.8
Diluted earnings per share 49.690.465.043.022.6
CASH FLOWS Net cash flow from operating activities 321.4 625.3 324.3 238.2 429.6
Free cash flow
(3)
141.0 430.4 140.5 12.5 73.8
Dividends paid (146.4) (181.3) (224.9) (195.7) (145.5)
(1) Net interest-bearing debt (debt less cash and cash equivalents and short-term investments) to net interest bearing debt and equity (less hedging reserves). Net interest-bearing debt excludes lease liabilities recognised on the adoption of
IFRS 16 – Leases.
(2) Final dividend is paid in the following financial year.
(3) Free cash flow represents net cash flows from operating activities less capital expenditure - including lease liability repayments following the adoption of IFRS 16 - Leases.
Section 5 | APPENDICES
Fisher & Paykel Healthcare | ANNUAL REPORT 2024161
FIVE YEAR SUMMARY (CONTINUED)
For the years ended 31 March
All figures in NZ$M (except as otherwise stated)
20202021202220232024
CAPITAL
EXPENDITURE
Plant and equipment 63.5 123.0 97.4 98.8 65.5
Land and buildings 81.8 37.2 41.0 89.0 251.3
Intangible assets 25.4 24.5 31.4 23.5 22.2
Total 170.7 184.7 169.8 211.3 339.0
Plant & equipment capex: depreciation ratio
(1)
2.2 2.8 2.3 2.3 1.3
PATENT
PORTFOLIO
NUMBERS
US patents 302 381 454 522 601
US patent applications (includes PCTs)
(2)
430 454 504 534 557
Non-US patents 1,236 1,508 1,947 2,329 2,815
Non-US patent applications (excludes PCTs)
(2)
1,228 1,345 1,491 1,708 1,862
PEOPLE NUMBERS People numbers
(3)
5,081 6,897 7,375 6,564 7,141
By function:Research and development 597 684 765 846 928
Manufacturing and operations 3,098 4,685 4,989 3,975 4,421
Sales, marketing and distribution 1,132 1,230 1,311 1,408 1,455
Management and administration 254 298 310 335 337
By region:New Zealand 2,738 3,932 3,927 3,538 3,544
North America 1,645 2,191 2,608 2,147 2,675
Europe 333 350 380 379 389
Rest of World 365 424 460 500 533
EXCHANGE RATES
NZ$ 1 =
AVERAGE DAILY SPOT RATES USD0.64770.67140.69690.62410.6097
AVERAGE CONVERSION RATES
(4)
USD 0.66710.66920.67340.66660.6582
EUR 0.57600.56240.55710.54520.5435
JPY 72.4469.7071.8070.2473.10
MXN 13.4713.7914.9714.4813.02
CLOSING SPOT RATES USD 0.60160.69810.69570.62900.5989
EUR 0.54560.59640.62310.57660.5535
JPY 65.2077.3785.1183.4890.63
MXN 14.3414.3713.8411.389.91
(1) Depreciation excludes leased asset depreciation
(2) PCTs (Patent Cooperation Treaty) are unified patent applications across a number of jurisdictions.
(3) People numbers are represented as full time equivalents.
(4) Actual exchange rates achieved in delivering or purchasing net foreign currency in relation to the Group’s exposures. The average rate includes hedged, spot and close-out transactions in each year.
162
Section 5 | APPENDICES
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
GLOSSARY
AAALACAssociation for Assessment and Accreditation of Laboratory Animal Care
ARCAudit & Risk Committee
ASMAnnual Shareholders’ Meeting
ASXAustralian Stock Exchange
AUDAustralian Dollar
BEPSBase Erosion and Profit Shifting
BIACThe OECD’s Business and Industry Advisory Committee
CAGRCompound Annual Growth Rate
CBAMCarbon Border Adjustment Mechanism
CDPThe name of the international not-for-profit that facilitates environmental
disclosures. Formerly known as the Carbon Disclosure Project
CEOChief Executive Officer
CFOChief Financial Officer
CODMChief Operating Decision Maker
COGSCost Of Goods Sold
Companymeans Fisher & Paykel Healthcare Corporation Limited
Constant
Currency (CC)
is our way to measure performance of the company without any
distortion from changes in foreign exchange rates
CPScents per share
CRDClimate-related Disclosures
DAV RDiscretionary Annual Variable Remuneration
DEIDiversity, Equity and Inclusion
DJSMDQTDow Jones US Select Medical Equipment Total Return Index
DRPDividend Reinvestment Plan
E&SREnvironmental & Social Responsibility
EAPEmployee Assistance Programme
EBITDAEarnings before interest, tax, depreciation and amortisation
ERP Enterprise Resource Planning
ESGEnvironmental, Social and Governance
ESREmployee Share Right
ETSEmissions Trading Scheme
EUREuro
Executive
Management
the Executive Management team as set out on pages 31-33
F&PFisher & Paykel Healthcare
FDA United States Food and Drug Administration
FIFOFirst In, First Out
FMAFinancial Markets Authority
FPHFisher & Paykel Healthcare
FYFinancial Year
GCPGood Clinical Practice
GDPGross Domestic Product
GHGGreenhouse gas
GRIGlobal Reporting Initiative
Groupmeans Fisher & Paykel Healthcare Corporation Limited together with
its subsidiaries
GSTGoods and Services Tax
GWPGlobal Warming Potentials
ICTInformation and Communication Technology
IEAInternational Energy Agency
IFRSInternational Financial Reporting Standards
IIASAInternational Institute for Applied Systems Analysis
IP Intellectual Property
IPCCIntergovernmental Panel on Climate Change
ISAInternational Standards on Auditing
ISDAInternational Swaps and Derivatives Association
ISOInternational Organisation for Standardisation
JPYJapanese Yen
LTIFRLost Time Injury Frequency Rate
LTV RLong Term Variable Remuneration
MXNMexican Peso
Net DebtDebt less cash and cash equivalents and short-term investments
Section 5 | APPENDICES
Fisher & Paykel Healthcare | ANNUAL REPORT 2024163
GLOSSARY (CONTINUED)
USUnited States
USDUnited States Dollar
VPVice President
VWAPVolume-Weighted Average Price
WG1Working Group 1
XRBExternal Reporting Board
Key medical terms used throughout this Report
CPAP Continuous Positive Airway Pressure
NHFNasal High Flow
NIVNoninvasive Ventilation
OSA Obstructive Sleep Apnea
New
Applications
Consumables
Hospital applications outside of traditional invasive ventilation
NHSNational Health Service
NZNew Zealand
NZ GAAPNew Zealand Generally Accepted Accounting Practice
NZ IAS New Zealand International Accounting Standards
NZ IFRSNew Zealand Equivalents to International Financial Reporting Standards
NZCSNew Zealand Climate Standards
NZDNew Zealand Dollar
NZXNew Zealand Stock Exchange
OECDOrganisation for Economic Co-operation and Development
OEMOriginal Equipment Manufacturer
OIOOverseas Investment Office
PCPPrior Comparable Period
PCTPatent Cooperation Treaty
psmper square metre
PSRPerformance Share Right
QMSQuality Management System
R&D Research and Development
SBTiScience Based Targets initiative
SDGSustainable Development Goal
SG&A Sales, General and Administrative
SSPShared Socioeconomic Pathway
STEMMScience, Technology, Engineering and Mathematics
(and mātauranga Māori)
STEPSStated Policies Scenario
TCFDTask Force on Climate-related Financial Disclosures
TRIFRTotal Recordable Injury Frequency Rate
TSRTotal Shareholder Return
UNUnited Nations
164
Section 5 | APPENDICES
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
GRI CONTENT INDEX
2021
GRI REF
Number
DisclosureLocation/Response
The organisation and its reporting practices
2-1Organisational
details
Name of the organisation:
Annual Report: Front cover. Fisher & Paykel Healthcare
Corporation Limited.
Location of headquarters:
Annual Report: Inside back cover.
Location of operations:
Annual Report: pp. 79-80.
Ownership and legal form:
Annual Report: p. 127, pp. 75-80.
Scale of the organisation:
Annual Report: p. 18.
Annual Report: pp. 160-162.
2-2Entities included in
the organisation’s
sustainability
reporting
List of entities:
For the list of entities see pages 79-80. Our sustainability
reporting relates to all subsidiary companies in the Group
structure.
2-3Reporting period,
frequency and
contact point
Reporting period:
See page 2. Reporting period is 1 April 2023 to 31 March 2024.
Date of most recent report:
May 2024 for the period 1 April 2023 to 31 March 2024.
Reporting cycle:
Annual reporting cycle.
Contact point for questions regarding the report:
investor@fphcare.co.nz
2-4Restatements of
information
Restatements of information:
No restatements of information for previous reporting
periods.
Changes in reporting:
In addition to reporting net profit after tax, we are
disclosing underlying net profit after tax, which excludes
the abnormal FY24 impact of a product recall provision, the
revaluation of land and deferred tax on removal of building
depreciation. For more information, refer to page 119.
This report also includes our Climate-related Disclosures
on pages 94-114, in compliance with the External Reporting
Board’s Aotearoa New Zealand Climate Standards.
2-5External assurance External assurance for non-financial disclosures:
External assurance of environmental disclosures provided
by Toitū Envirocare (no external assurance for other non-
financial disclosures). Annual Report: pp. 112-114.
External assurance for financial statements:
External assurance provided by PwC.
Annual Report: pp. 152-156.
Activities and workers
2-6Activities, value
chain, and
other business
relationships
Activities, brands, products and services:
Annual Report: pp. 8-9, pp. 18-21.
Markets served:
Annual Report: p. 18.
Supply chain:
Annual Report: pp. 53-59.
Significant changes to the organisation and its supply
chain:
We received OIO approval to purchase land for a second
New Zealand campus at Karaka in April 2023. We also
continued development of our new manufacturing facility
in China. More detail on our infrastructure planning is
provided in the Report from the Chair on pages 11-12.
2-7EmployeesScale of the organization (total number of employees):
Annual Report: pp. 38-39.
Information on employees and other workers:
Annual Report: pp. 36-46.
2-8Workers who are
not employees
Information on employees and other workers (information
on workers who are not employees):
The most common type of worker in the organisation can
be described as full-time and permanent. On page 38 of
the Annual Report, we disclose that we had 137 temporary
workers as at 31 March 2024.
Section 5 | APPENDICES
Fisher & Paykel Healthcare | ANNUAL REPORT 2024165
GRI CONTENT INDEX (CONTINUED)
Governance
2-9Governance
structure and
composition
Governance structure:
Annual Report: pp. 65-80.
Composition of the highest governance body and its
committees:
Annual Report: pp. 66-74.
2-10Nomination and
selection of the
highest governance
body
Nominating and selecting the highest governance body:
Annual Report: pp. 68-69.
2-11Chair of the highest
governance body
Chair of the highest governance body:
Annual Report: p. 29 (Board Chair biography).
Annual Report: pp. 73-74 (General disclosure of interests
by directors).
Board Charter available online at https://www.fphcare.com/
nz/corporate/sustainability/governance/
2-12Role of the highest
governance body
in overseeing the
management of
impacts
Consulting stakeholders on economic, environmental,
and social topics:
Annual Report: pp. 22-23.
Role of highest governance body in setting purpose,
values and strategy:
Annual Report: p. 68.
Identifying and managing economic, environmental,
and social impacts:
Annual Report: pp. 22-23.
Effectiveness of risk management processes:
Annual Report: pp. 61-64.
2-13Delegation of
responsibility for
managing impacts
Delegating authority:
Annual Report: p. 68.
Executive-level responsibility for economic,
environmental, and social topics:
Annual Report: p. 68.
2-14Role of the highest
governance body
in sustainability
reporting
Highest governance body’s role in sustainability reporting:
Annual Report: p. 75 (Other reporting).
2-15Conflicts of interest Conflicts of interest:
Annual Report: p. 66, pp. 73-74.
2-16Communication of
critical concerns
Communicating critical concerns:
Annual Report: p. 66 (Speak Up Procedure).
2-17Collective
knowledge of the
highest governance
body
Collective knowledge of highest governance body:
Annual Report: pp. 68-69.
Board Charter available online at https://www.fphcare.
com/nz/corporate/sustainability/governance/corporate-
governance-policies/
2-18Evaluation of the
performance of the
highest governance
body
Evaluation of the performance of the highest governance
body:
Annual Report: pp. 70-72.
2-19Remuneration
policies
Remuneration policies:
Annual Report: pp. 81-89.
2-20Process to
determine
remuneration
Process for determining remuneration:
Annual Report: pp. 83-88 (Executive Management).
Stakeholders’ involvement in remuneration:
Annual Report: p. 89 (Directors).
2-21Annual total
compensation ratio
Annual total compensation ratio:
Annual Report: p. 88.
166
Section 5 | APPENDICES
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
GRI CONTENT INDEX (CONTINUED)
Strategy, policies and practices
2-22Statement on
sustainable
development
strategy
Statement from senior decision-maker:
Annual Report: pp. 11-15.
2-23Policy
commitments
Approach:
As part of our commitment to creating a positive lasting
impact on society and the environment, we recognise the
need to mitigate and adapt to a changing climate both
now and in the decades to come. See pages 90-114.
Values, principles, standards and norms of behaviour:
Annual Report: p. 19.
Code of Conduct available online at https://www.fphcare.
com/nz/corporate/sustainability/governance/corporate-
governance-policies/
2-24Embedding policy
commitments
The company has released a set of global awareness and
training activities for its new policies and procedures.
2-25Processes to
remediate negative
impacts
The management approach and its components
(grievance mechanisms):
Annual Report: p. 66.
2-26Mechanisms for
seeking advice and
raising concerns
Mechanisms for advice and concerns about ethics
Annual Report: p. 66.
2-27Compliance
with laws and
regulations
Non-compliance with environmental laws and regulations:
There have been no significant instances of non-
compliance with environmental laws and regulations
during the 2024 financial year.
Non-compliance with laws and regulations in the social
and economic area:
There have been no significant instances of non-
compliance with social and economic laws and regulations
during the 2024 financial year.
2-28
Membership
associations
Membership of associations:
• American Academy of Sleep Medicine
• American Association of Homecare
• American Association of Physicians of Indian Origin for Sleep
• American Association of Respiratory Care
• American Chamber of Commerce
• American Association of Sleep Technologists
• American College of Emergency Physicians
• American Thoracic Society
• Association for Anaesthetic and Respiratory Device Suppliers
• Association of Anaesthetists
• Association for Respiratory Technology & Physiology
• Auckland Chamber of Commerce
• Australasian Investor Relations Association
• Australasian Sleep Association
• Austrian Chamber of Commerce
• Board of Registered Polysomnographic Technologists
• Brazilian Association of Medical Products Importers/
Distributors
• British Anaesthetic & Respiratory Equipment
Manufacturers Association
• British Thoracic Society
• Business New Zealand
• Council for International Development
• Diversity Works
• Employers and Manufacturers Association
• German Chamber of Commerce
• German Industry Association of Medical Technology
(Spectaris)
• Guangdong Investment Promotion Association in China
• Hong Kong Medical and Healthcare Device Industries
Association
• International Electrotechnical Commission / Technical
Committee 62
• International Medical Device Manufacturers Association
• International Organisation for Standardisation / Technical
Committee 121
• Japan Association of Health Industry Distributors
• Japan Association of Medical Devices Industries
• Latin America New Zealand Business Council
• Medical Technology Association New Zealand
• National Association for Medical Direction of Respiratory
Care
• NZ Chamber of Commerce (Hong Kong)
• Sleep Health Foundation
• Sleep Research Society
• Sustainable Business Network
• Taipei Medical Instruments Commercial Association
• The Japan Fair Trade Council of the Medical Devices Industry
• Victorian Chamber of Commerce and Industry
Section 5 | APPENDICES
Fisher & Paykel Healthcare | ANNUAL REPORT 2024167
GRI CONTENT INDEX (CONTINUED)
Stakeholder engagement
2-29Approach to
stakeholder
engagement
List of stakeholder groups:
Annual Report: pp. 22-23.
Identifying and selecting stakeholders:
Annual Report: pp. 22-23.
Approach to stakeholder engagement:
Annual Report: pp. 22-23.
Key topics and concerns raised:
Annual Report: pp. 22-23.
2-30Collective
bargaining
agreements
Collective bargaining agreements:
Annual Report: p. 44.
Disclosures on material topics
3-1Process to
determine material
topics
Defining report content and topic boundaries:
Annual Report: pp. 22-23.
3-2List of material
topics
List of material topics:
Annual Report: pp. 22-23.
SPECIFIC STANDARD DISCLOSURES
2021
GRI REF
Number
DisclosureLocation/Response
GRI 200 Economic standard series
GRI 103Management approach 2024Annual Report: pp. 11-15.
GRI 201: Economic performance
201-1Direct economic value
generated and distributed
Annual Report: pp. 118-156 (Financial
statements including auditor’s report).
GRI 204: Procurement practices
GRI 204Management approach 2024
and dialogue with suppliers
pp. 53-59.
GRI 205: Anti-corruption
GRI 103Management approach 2024Annual Report: p. 67.
205-3Confirmed incidents of
corruption and actions taken
Annual Report: p. 67. During the year ended
31 March 2024, the company is not aware of
any instances of corruption or of incidents
in which employees were dismissed or
disciplined for corruption.
GRI 400 Social standard series
GRI 103Management approach 2024Annual Report: pp. 36-37, pp. 40-46.
401-1New employee hires and
employee turnover
Annual Report: p. 39.
GRI 403: Occupational health and safety
GRI 403-2Types of injury and rates of
injury, occupational diseases,
lost days, and absenteeism,
and number of work-related
fatalities
Annual Report: pp. 45-46.
GRI 404: Training and education
GRI 103Management approach 2024Annual Report: pp. 40-41.
404-1Average hours of training per
year per employee
For salaried employees in New Zealand, our
people undertook an average of 11.5 training
hours during the financial year.
GRI 416: Customer health and safety
GRI 103Management approach 2024Annual Report: pp. 61-62.
416-2Incidents of non-compliance
concerning the health and
safety impacts of products and
services
No instances of non-compliance with
regulations or voluntary codes resulting in
a fine, penalty or warnings. As disclosed on
page 128, we initiated a voluntary limited
recall of Airvo 2 and myAirvo 2 devices
manufactured before 14 August 2017.
GRI 418: Customer privacy
GRI 103Management approach 2024https://www.fphcare.com/nz/corporate/
about-us/privacy-statement/
418-1Substantiated complaints
concerning breaches of
customer privacy and losses of
customer data
No substantiated complaints received
concerning breaches of customer privacy.
168
Section 5 | APPENDICES
Fisher & Paykel Healthcare | ANNUAL REPORT 2024
DIRECTORY
DIRECTORY
In New Zealand:
The details of the company’s principal administrative and registered office are:
Physical address: 15 Maurice Paykel Place, East Tāmaki,
Auckland 2013, New Zealand
Telephone: +64 9 574 0100
Facsimile: +64 9 574 0158
Postal address: PO Box 14348, Panmure,
Auckland 1741, New Zealand
Website: www.fphcare.com
Email: investor@fphcare.co.nz
In Australia:
The details of the company’s registered office are:
Physical address: 19-31 King Street, Nunawading,
Melbourne, Victoria 3131, Australia
Telephone: +61 3 9871 4900
Postal address: PO Box 159, Mitcham,
Victoria 3132, Australia
SHARE REGISTER
In New Zealand:
Link Market Services Limited
Physical address: Level 30, PwC Commercial Bay,
15 Customs Street West, Auckland 1010, New Zealand
Postal address: PO Box 91976,
Auckland 1142, New Zealand
Facsimile: +64 9 375 5990
Investor enquiries: +64 9 375 5998
Website: www.linkmarketservices.co.nz
Email: enquiries@linkmarketservices.co.nz
In Australia:
Link Market Services Limited
Physical address: Level 12, 680 George Street,
Sydney, NSW 2000, Australia
Postal address: Locked Bag A14,
Sydney South, NSW 1235, Australia
Facsimile: +61 2 9287 0303
Investor enquiries: +61 2 8280 7111
Website: www.linkmarketservices.com.au
Email: registrars@linkmarketservices.com.au
Section 5 | APPENDICES
Fisher & Paykel Healthcare | ANNUAL REPORT 2024169
© 2024 Fisher & Paykel
Healthcare Corporation Limited
fphcare.com
LASTING
FOUNDATIONS
---
Disclaimer
The information in this presentation is for general purposes only and should be read in conjunction with Fisher & Paykel Healthcare Corporation
Limited’s (FPH) Annual Report 2024 and accompanying market releases.Nothing in this presentation should be construed as an invitation for
subscription, purchase or recommendation of securities in FPH.
This presentation includes forward-looking statements about the financial condition, operations and performance of FPH and its
subsidiaries.These statements are based on current expectations and assumptions regarding FPH’s business and performance, the economy and
other circumstances.As with any projection or forecast, the forward-looking statements in this presentation are inherently uncertain and
susceptible to changes in circumstances.FPH’s actual results may differ materially from those expressed or implied by those forward-looking
statements.
Non-GAAP financial information
Constant currency information included within this presentation is non-GAAP financial information, as defined by the NZ Financial Markets
Authority, and has been provided to assist users of financial information to better understand and track the company’s comparative financial
performance without the impacts of spot foreign currency fluctuations and hedging results and has been prepared on a consistent basis each
year. The company’s constant currency framework can be found on the company’s website at www.fphcare.com/ccf.
Underlying net profit after tax, referenced within this presentation, is a non-GAAP performance measure and is not defined or specified under
the requirements of NZ IFRS. FPH believes that this non-GAAP measure, which is not considered to be a substitute for or superiorto NZ IFRS
measures, provides stakeholders with additional helpful information on the performance of the business.
A reconciliation between reported results and constant currency/underlying net profit after tax is available in the company’sAnnual Report 2024.
Change
Change
FY24 (12 months to 31 March 2024)
Reported
(NZ$M)
Growth CC*
Adjustments for abnormal items
Underlying
(NZ$M)
Underlying
growth PCP^
Underlying
growth CC*
Product recall
(NZ$M)
Revaluation of
land (NZ$M)
Deferred tax**
(NZ$M)
Operating revenue1,742.88%---1,742.810%8%
Hospital operating revenue1,087.95%---1,087.96%5%
Homecare operating revenue652.316%---652.318%16%
Cost of sales(698.4)6%20.0--(678.4)6%3%
Gross profit1,044.410%20.0--1,064.413%12%
Gross margin59.9%+95 bps---61.1%+172 bps+216 bps
SG&A(492.8)13%---(492.8)14%13%
R&D(198.2)14%---(198.2)14%14%
Total operating expenses(691.0)13%---(691.0)14%13%
Operating profit353.43%20.0--373.412%10%
Operating margin20.3%-85 bps---21.4%+41 bps+36 bps
Revaluation of land(98.1)--98.1----
Profit before financing and tax255.3-31%20.098.1-373.412%10%
Net financing expense(19.6)----(19.6)--
Profit before tax235.7-35%20.098.1-353.88%7%
Tax expense(103.1)33%(5.6)-19.3(89.4)15%12%
Profit after tax132.6-56%14.498.119.3264.46%5%
* CC = constant currency
** Building tax depreciation change
^ PCP = prior comparable period
10%
90%
HardwareConsumables
FY24 HOSPITAL REVENUE COMPOSITION
HARDWARE
CONSUMABLES
Invasive
ventilation
Noninvasive
ventilation
Optiflow
TM
nasal high flow
Surgical
Optiflow
TM
anesthesia
*New applications = Noninvasive ventilation (NIV), nasal high flow, surgical
•
•
•
12%
88%
HardwareConsumables
FY24 HOMECARE REVENUE COMPOSITION
HARDWARE
CONSUMABLES
CPAP Therapy/OSAHome Respiratory Support
•
•
•
•
•
•
Historical cost
FY24 NZ$M
Fair value
FY24 NZ$M
East Tāmaki(42 ha)86.4263.9
Karaka*(79 ha)220.1122.0
Total New Zealand 306.5385.9
Mexico (15 ha)27.437.7
Total land333.9423.6
*Approximately 79 hectares has been acquired to date. The balance of land
(approximately 25 hectares) will be settled in instalments due in January 2026 and
December 2026.
0%
10%
20%
30%
40%
50%
60%
70%
FY14FY15FY16FY17FY18FY19FY20FY21FY22FY23FY24*
Long-term gross margin target
GROSS MARGIN
•
•
•
*Underlying gross margin excludes the product recall provision
0%
5%
10%
15%
20%
25%
30%
35%
40%
FY14FY15FY16FY17FY18FY19FY20FY21FY22FY23FY24*
OPERATING (EBIT) MARGIN
Long-term operating margin target
•
•
•
•
•
•
*Underlying operating margin excludes the product recall provision
FY23 NZ$MFY24 NZ$M
Operating cash flow238.2429.6
Capital expenditure (includingpurchases of intangible assets)(211.3)(339.0)
Lease liability payments(14.4)(16.8)
Free cash flow12.573.8
FY23 NZ$MFY24 NZ$M
Net cash / (debt) (including short-term investments)37.7(32.2)
Total assets2,204.52,281.7
Total equity1,753.41,759.1
Gearing(net debt / net debt + equity)*-2.3%1.8%
Undrawn committed debt facilities624.5544.3
* Calculated using net interest-bearing debt (debt less cash and cash equivalents) to net interest-bearing debt and equity (lesshedge reserve).
DIVIDEND HISTORY
•
−
−
−
•
•
Reconciliation of Constant Currency to Reported Profit After Tax
FY23
NZ$M
FY24
NZ$M
Change
NZ$M
Profit after tax (constant currency)213.993.6(120.3)
Spot exchange rate effect31.736.54.8
Foreign exchange hedging result2.61.4(1.2)
Balance sheet revaluation2.11.1(1.0)
Total impact of foreign exchange36.439.02.6
Profit after tax (as reported)250.3132.6(117.7)
Reconciliation of Constant Currency to Reported Revenue
FY23
NZ$M
FY24
NZ$M
Change
NZ$M
Revenue (constant currency)1,523.71,651.6127.9
Spot exchange rate effect53.999.445.5
Foreign exchange hedging result(7.5)(15.3)(7.8)
Balance sheet revaluation11.07.1(3.9)
Total impact of foreign exchange57.491.233.8
Revenue (as reported)1,581.11,742.8161.7
•
•
•
•
•
*At1 May 2024 exchange rates of NZD:USD 0.59, NZD:EUR 0.56, NZD:MXN 10.14.
% of RevenueNZ$M
PCP^CC**
Operating revenue100%939.15%3%
Hospital operating revenue64%600.43%0%
Homecare operating revenue36%337.911%8%
Hospital new applications consumables revenue12%9%
OSA masks revenue14%10%
Underlying gross profit*62%578.3260bps244bps
SG&A27%256.212%11%
R&D11%101.312%12%
Total operating expenses38%357.512%11%
Underlying operating profit*24%220.87%0%
Underlying profitafter tax*17%157.12%-3%
* Underlying gross profit excludes the voluntary recall provision. Underlying operating profit and underlying profit after tax also excludes the revaluation of the Karaka land, and the removal of
building depreciation deductibility.
** CC = constant currency
^ PCP = prior comparable period
Year to 31 March
Hedging position for our main exposures
FY25FY26FY27FY28FY29
FY30-
FY35*
USD % cover of estimated exposure80%75%60%45%20%0%
USD average rate of cover0.6210.6070.5970.5840.5640.523
EUR % cover of estimated exposure90%75%60%40%40%5%
EUR average rate of cover0.5320.5320.5260.5240.5070.465
MXN % cover of estimated exposure55%30%0%---
MXN average rate of cover13.7712.6511.41---
Hedging cover percentages have been rounded to the nearest 5%
•
* 2030 –2035 shows average % cover of expected exposure and rate of cover for the five-year period.
1%
49%
19%
1%
30%
NZDUSDEURMXNOther
REVENUE BY CURRENCY
37%
40%
3%
15%
5%
NZDUSDEURMXNOther
COST OF SALES BY CURRENCY
48%
24%
10%
<1%
18%
NZDUSDEURMXNOther
OPERATING EXPENSES BY CURRENCY
FY24 (for the year ended 31 March 2024)
•
•
•
•
•
•
•
•
•
•
Note: people numbers are represented as full-time equivalents
Applications outside of invasive ventilation
Surgical
Home Respiratory
Support
Obstructive Sleep
Apnea
Noninvasive
Ventilation
Invasive
Ventilation
Hospital
Respiratory Support
Infant Care
Anesthesia
The image above is an illustration of the company’s long-term growth aspirations. It is not a graph and should not be interpreted as being
indicative of levels of revenue or profitability in the short term.
•
•
−
−
−
−
−
•
*For year ended 31 March 2024
†As at31 March 2024
FISHER & PAYKEL HEALTHCARE US PATENT PORTFOLIO (2008 – 2024)
*As at31 March 2024
0
100
200
300
400
500
600
700
200820102012201420162018202020222024
US PatentsUS Patent Applications
•
•
•
•
•
•
Insert image of products
in action and or Sales
talking with clinician
•
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−
−
−
•
−
•
−
•
Revenue by Region
12 months to 31 March 2024
46%
27%
21%
6%
North America
Europe
Asia Pacific
Other
•
•
•
•
•
•
•
•
•
•
−°
−
-10%
0%
10%
20%
30%
40%
50%
60%
FY11FY12FY13FY14FY15FY16FY17FY18FY19FY20FY21FY22FY23FY24
CONSTANT CURRENCY REVENUE GROWTH RATE
IN NEW APPLICATIONS CONSUMABLES*
* Adjusted to exclude impact of US distribution transition in FY16 and FY17
Noninvasive
ventilation
Optiflow
TM
nasal high flow
Surgical
Optiflow
TM
anesthesia
•
•
•
CONVENTIONAL
OXYGEN THERAPY
NON-INVASIVE
VENTILATION
Primary support
MEDICAL
Primary support
POST-OPERATIVE
Pre-escalation support/ Peri-
intubation
Post-extubation/
De-escalation support
Complementary support
(NIV-rested/proning)
Prophylactic support
(Require oxygen/avoid escalation)
ESICM, ERS, SSC, AARC,
ACP, TSANZ, WHO
ESICM, ERS
ESICM
ESICM, ERS,
AARC, ACP
ERS
AARC
Clinical practice guidelines –ESICM
1
, ERS
2
, SSC
3
, AARC
4
, ACP
5
, TSANZ
6
, WHO
7
0
100
200
300
400
500
600
700
800
900
Annual total of studies (calendar year)
NASAL HIGH FLOW CLINICAL PAPERS PUBLISHED ANNUALLY
Source: PubMed. Includes adult and paediatric/neonatal studies.
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Scope 1 emissions (tonnesCO
2
e)1,7772,2872,123
Scope 2 emissions (tonnesCO
2
e) –location-based13,89414,52914,293
Scope 2 emissions (tonnesCO
2
e) –market-based10,34411,10512,253
Scope 1 & 2 emissions subtotal (tonnesCO
2
e) –using location-based Scope 2 15,67116,81616,416
Scope 1 & 2 emissions subtotal (tonnesCO
2
e) –using market-based Scope 2 12,12113,39214,376
Scope 3 emissions (tonnesCO
2
e)457,112328,313302,479
Total emissions (tonnesCO
2
e) -using location-based Scope 2472,783345,129318,895
Total emissions (tonnesCO
2
e) -using market-based Scope 2469,233341,705316,855
Water usage (cubic metres)184,171133,517136,923
Landfill waste diverted (cubic metres)2,0351,7271,348
NZ recycling efficiency (percentage of waste diverted from landfill)68%62%59%
Global recycling efficiency (percentage of waste diverted from landfill)52%54%53%
•
18%
61%
18%
3%
NZ InstitutionsOther Institutions
Brokers & RetailOther
37%
31%
14%
9%
4%
4%
<1%
New ZealandAustralia
North AmericaUK
Europe (ex UK)Asia
Rest of World
Geographical ownership as at
31 March 2024
Shareholding structure as at
31 March 2024
1.Rochwerg, Bram et al. “The role for high flow nasal cannula as a respiratory support strategy in adults: a clinical practice guideline.”Intensive care medicine vol. 46,12 (2020): 2226-2237. doi:10.1007/s00134-020-06312-y
2.Oczkowski, Simon, et al. “ERS Clinical Practice Guidelines: High-flow Nasal Cannula in Acute Respiratory Failure.” European Respiratory Journal, vol. 59, no. 4, European Respiratory Society (ERS), Oct. 2021, p. 2101574. Crossref,
https://doi.org/10.1183/13993003.01574-2021.
3.Evans, Laura, et al. “Surviving Sepsis Campaign: International Guidelines for Management of Sepsis and Septic Shock 2021.” Critical Care Medicine, vol. 49, no. 11, Ovid Technologies (Wolters Kluwer Health), Oct. 2021, pp. e1063–143.
Crossref, https://doi.org/10.1097/ccm.0000000000005337.
4.Piraino, Thomas, et al. “AARC Clinical Practice Guideline: Management of Adult Patients With Oxygen in the Acute Care Setting.” Respiratory Care, vol. 67, no. 1, Daedalus Enterprises, Nov. 2021, pp. 115–28. Crossref,
https://doi.org/10.4187/respcare.09294.
5.Qaseem, Amir, et al. “Appropriate Use of High-Flow Nasal Oxygen in Hospitalized Patients for Initial or PostextubationManagement of Acute Respiratory Failure: A Clinical Guideline From the American College of Physicians.” Annals of
Internal Medicine, vol. 174, no. 7, American College of Physicians, July 2021, pp. 977–84. Crossref, https://doi.org/10.7326/m20-7533.
6.Barnett, Adrian, et al. “Thoracic Society of Australia and New Zealand Position Statement on Acute Oxygen Use in Adults: ‘Swimming Between the Flags.’” Respirology, vol. 27, no. 4, Wiley, Feb. 2022, pp. 262–76. Crossref,
https://doi.org/10.1111/resp.14218.
7.Clinical management of COVID-19: Living guideline, 23 June 2022. Geneva: World Health Organization; 2022 (WHO/2019-nCoV/Clinical/2022.1). Licence: CC BY-NC-SA 3.0 IGO.
8.Mason, S. E., Kinross, J. M., Reynecke, D., Hendricks, J. & Arulampalam, T. H. (2015). Cost-effectiveness of warm humidified CO2 to reduce surgical site infections inlaparoscopiccolorectal surgery: a cohort study. Gut, 64,
A556.http://dx.doi.org/10.1136/gutjnl-2015-309861.1220.
9.Frey, J. M., Janson, M., Svanfeldt, M., Svenarud, P. & van der Linden, J. A. (2012). Local insufflation of warm, humidified CO2 increases open wound and core temperature duringopen colon surgery: a randomized clinical trial. Anesthesia
Analgesia, 115(5), 1204–1211.https://doi:10.1213/ANE.0b013e31826ac49f.
10.Matsuzaki, S., Vernis, L., Bonnin, M., Houlle, C., Fournet-Fayard, A., Rosano. G., Lafaye. A. L., Chartier, C., Barriere, A., Storme, B., Bazin. J-E., Canis, M., Botchorishvilli, R. (2017). Effects of low intraperitoneal pressure and a warmed,
humidified carbon dioxide gas in laparoscopic surgery: a randomized clinical trial. Scientific Reports, 7(1), 11287.https://doi.org/10.1038/s41598-017-10769-1.
11.World Health Organization (2018) The top 10 causes of death, Available at: https://www.who.int/news-room/fact-sheets/detail/the-top-10-causes-of-death (Accessed: 24 May 2018)
12.Nicole M Kosacz, Antonello Punturieriet al. Chronic Obstructive Pulmonary Disease Among Adults -United States 2011. US Centers for Disease Control and Prevention, 2012.
13.Storgaard LH, et al. Long-term effects of oxygen-enriched high-flow nasal cannula treatment in COPD patients with chronic hypoxemic respiratory failure. Int J Chron Obstruct Pulmon Dis 2018;13:1195-1205.
---
29 May 2024
Results announcement
Results for announcement to the market
Name of issuer Fisher & Paykel Healthcare Corporation Limited
Reporting Period 12 months to 31 March 2024
Previous Reporting Period 12 months to 31 March 2023
Currency NZD
Amount (000s) Percentage change
Revenue from continuing
operations
$1,742,800 10%
Total Revenue $1,742,800 10%
Net profit/(loss) from
continuing operations
$132,600 -47%
Total net profit/(loss) $132,600 -47%
Final Dividend
Amount per Quoted Equity
Security
0.23500000 $/share
Imputed amount per Quoted
Equity Security
0.09138889 $/share
Record Date 27 June 2024
Dividend Payment Date 10 July 2024
Current period Prior comparable period
Net tangible assets per
Quoted Equity Security
2.71215497 $/share 2.71732481 $/share
A brief explanation of any of
the figures above necessary
to enable the figures to be
understood
Not applicable
Authority for this announcement
Name of person
authorised
to make this announcement
Raelene Leonard
Contact person for this
announcement
Raelene Leonard
Contact phone number +64 9 574 0147
Contact email address companysecretary@fphcare.co.nz
Date of release through MAP
29 May 2024
Audited financial statements accompany this announcement.
---
29 May 2024
Distribution Notice
Section 1: Issuer information
Name of issuer Fisher & Paykel Healthcare Corporation Limited
Financial product name/description Final Dividend
NZX ticker code FPH
ISIN NZFAPE0001S2
Type of distribution
Full Year 2024 Quarterly
Half Year Special
DRP applies Yes
Record date 27 June 2024
Ex-Date 26 June 2024
Payment date 10 July 2024
Total monies associated with the
distribution
$137,235,229 based on shares on issue at 28 May 2024 for cash
distribution
Source of distribution Retained earnings
Currency NZD
Section 2: Distribution amounts per financial product
Gross distribution 0.32638889 $/share
Gross taxable amount 0.32638889 $/share
Total cash distribution 0.23500000 $/share
Excluded amount N/A
Supplementary distribution amount
0.04147058 $/share
Section 3: Imputation credits and Resident Withholding Tax
Is the distribution imputed Fully imputed
If fully or partially imputed, please
state imputation rate as % applied
100%
Imputation tax credits per financial
product
0.09138889 $/share
Resident Withholding Tax per
financial product
0.01631944 $/share
Section 4: Distribution re-investment plan (if applicable)
DRP % discount (if any)
3.0%
Start date and end date for
determining market price for DRP
1 July 2024 5 July 2024
Date strike price to be announced (if
not available at this time)
8 July 2024
Specify source of financial products
to be issued under DRP programme
New Issue
(new issue or to be bought on
market)
DRP strike price per financial product
Last date to submit a participation
notice for this distribution in
accordance with DRP participation
terms
28 June 2024
Section 5: Authority for this announcement
Name of person
authorised to make
this announcement
Raelene Leonard
Contact person for this
announcement
Raelene Leonard
Contact phone number +64 9 574 0147
Contact email address companysecretary@fphcare.co.nz
Date of release through MAP 29 May 2024
Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.
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