The ResMed Inc (ASX: RMD) share price will be on watch on Friday following the release of its second quarter update this morning.
How is ResMed performing?
ResMed continued its strong form during the second quarter and delivered further revenue and profit growth.
According to the release, for the three months ended 31 December, ResMed reported a 9% increase in revenue to US$800 million.
Also heading in the right direction was the company’s gross margin. It reported a non-GAAP gross margin of 59.9%, up 20 basis points on the prior corresponding period.
This underpinned a 17% increase in net profit to US$206.4 million and earnings per share to US$1.41.
What were the drivers of its growth?
ResMed’s CEO, Mick Farrell, revealed that the company’s growth was driven by a solid performance across the business.
He commented: “Our second-quarter results reflect continued solid performance and positive trends across our business resulting in top-line growth as well as double-digit improvement in operating income and earnings per share.”
“In our core markets of sleep apnea, COPD, and asthma, we are seeing continued sequential improvement in new patient volume and ongoing adoption of our mask and accessories resupply programs. Our global teams have managed SG&A investments judiciously as we navigate through the global pandemic.”
Mr Farrel revealed that its digital health business has been performing strongly thanks to the growing importance of out-of-hospital care.
He explained: “We have seen great adoption of digital health and an increase in the importance of out-of-hospital healthcare these last 12 months, and that will only expand throughout 2021 as vaccines become more widely available, and our communities open up worldwide.”
“We have continued to invest in focused R&D programs in digital health and core medtech innovation, to help accelerate our ResMed growth strategy: improving 250 million lives in out-of-hospital healthcare in 2025,” he concluded.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended ResMed Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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