Currency difference affects sonic profits

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Sonic Healthcare, head office located in Sidney, Australia, announced its first-half profit report. It showed that the strength of the Australian dollar affected the company's overseas profits.


The report mentioned that net gain rose from $136.5 million, or 38.8 cents, a year before to $155.2 million, or 39.7 cents a share (14%), in six months ended by December.


Shares were affected after the report since it showed also that Australian dollar took $76.4 million from sales. This is due to the fact that Sonic gets about half of its profit from Europe and USA. Sonicbusiness is increasing in that region and it bought 19 companies there in last five years.


Andrew Goodsall, a health-care analyst at UBS AG in Sydney said:" The business is progressively becoming an offshore company, so the result was skewed,''. He expected profit of 162 million US dollars for the company. He added "there's quite a lot of movement in currencies this half compared to the prior corresponding period.'
US dollar lost 11% of its value against the Australian one while euro lost 8.3 % against the same currency in the last six months.


"The market is waking up to the fact that it's no longer an Australian company,'' said Shane Storey, an analyst at Wilson HTM Investment Group in Brisbane. "The premium that it's traded at is less appropriate now that most of the earnings are coming from offshore."


Sonic CEO Colin Goldschmidt offered this year' profit forecast expecting about 15% growth in profit. This was estimated on the basis of average currency values in 2009. Goldschmidt added that company has laboratories in several western countries including Germany, Switzerland and the U.K in addition to USA. He mentioned also that Sonic has $600 million for next purchases


About Sonic Healthcare:
International medical diagnostics company, offering laboratory and radiology services. The head office located in Sydney, Australia. Sonic offers services in several countries including New Zealand, the United Kingdom, Germany, Switzerland and the USA. For more information, please visit http://www.sonichealthcare.com/


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