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ResMed slips on first quarter income drop

AAP logoAAP 25/10/2016 Tom Rabe

ResMed shares have fallen more than 3.8 per cent after the sleep apnoea device maker reported a drop in first quarter profit.

The company's first quarter profit for the three months to September 30 dropped eight per cent to US $US76.1 million.

This was despite a 13 per cent increase in revenue to $US465.4 million, driven largely by the acquisition in April of healthcare software company Brightree.

Excluding the Brightree earnings, revenue for the quarter grew five per cent to $US432.4 million.

The company's gross margin increased to 57.8 per cent, which it said was down to manufacturing and procurement efficiencies.

Factors contributing to increased costs included operating expenses of $US128.8 million, up 16 per cent on the previous corresponding quarter, and $US34.4 in research and development, up 27 per cent.

The company also incurred a $US5 million cost for safety notifications for a problem with a battery in one of its ventilators.

ResMed's shares ended down 32 cents or 3.8 per cent at $8.08 on Wednesday.

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