UPDATE 2-NZ's F&P Healthcare cuts full-year forecast

(Adds analyst comment, share price reaction)

By Adrian Bathgate

WELLINGTON, April 9 (Reuters) - New Zealand medical equipment maker Fisher & Paykel Healthcare Ltd (FPH.NZ) cut its full-year operating profit forecast by 16 percent on Wednesday, citing a strong New Zealand dollar, sending its shares down 5.9 percent.

The company said the strong dollar cancelled out an increase in sales, which meant operating profit for the year to March 31 would be around NZ$57 million ($45.6 million), from a previous forecast of about NZ$68 million.

The ongoing strength of the currency meant a profit downgrade was not a big surprise, said Goldman Sachs JBWere investment manager Mark Warminger, but the company still had a solid outlook based on increasing sales.

"What investors have to do is weigh up the odds of the currency moving higher, versus the outlook for the company and their products," Warminger said.

Shares in Fisher & Paykel Healthcare, a top-10 company, opened on Wednesday down 5.9 percent, before paring losses to last trade down 3.9 percent at NZ$2.93.

The stock has fallen 16 percent so far this year, compared with an 11.5 percent drop in the benchmark top 50 index .NZ50.

Fisher & Paykel Healthcare, which makes more than 60 percent of its sales in U.S. dollars, has seen steadily declining operating profits from the NZ$104.4 million it posted in the year to March 2006, as the kiwi dollar remained well above its long-term average and the company's forward currency cover gradually expired.

Since the start of Fisher & Pakel's last financial year on Apr. 1 2007, the NZ dollar NZD= has risen 11.5 percent to hover near $0.80. It also hit a 23-year, post-float high during the year of $0.8215.

Revenue growth for the full year would be about 18 percent higher in U.S. dollar terms, or 2 percent higher in New Zealand dollar terms, at about NZ$355 million, the company said.

"We enjoyed robust operating revenue growth in the second half, in U.S. dollar terms, particularly in our respiratory and acute product group," chief executive Michael Daniell said in a statement.

Daniell said the the new financial year had started with a number of orders on the books and it expected to see demand continuing to increase.

Every one percentage point the kiwi gains against the U.S. dollar costs the company about NZ$2.5 million in operating profit, Daniell said.

Fisher & Paykel Healthcare, which competes against ResMed Inc (RMD.N) and Respironics Inc, was created in a split from New Zealand manufacturing icon Fisher & Paykel Industries in 2001. (NZ$1=$1.25) (Editing by Jonathan Standing and Jacqueline Wong)