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What's changed

RMD will initiate a quarterly dividend beginning in FY13. The first amount paid will be US17.0 cents per US-listed share for the period ended 1Q13.


For holders of the ASX-listed CDIs, RMD will make an unfranked, A$ payment equivalent to US1.7 cents per CDI. The company does not

expect the dividend payout to affect its ability to repurchase shares, invest in R&D, or make future potential acquisitions.


On CEO succession, the company commented that its acting CEO, Dr. Peter Farrell, will remain in his position until the end of calendar 2013. Both internal and external candidates will be reviewed for the position.



With a net cash balance of $540mn and free cash flow generation (predividends) of c. $240mn in FY12E, we believe RMD is in a comfortable position to return capital to shareholders via dividends of this magnitude i.e. c. $100mn p.a.



Our annual dividend forecasts for FY13E/FY14E are 68cps and 77cps, respectively, which is a yield of 2.1%/2.3%. We maintain our share buyback assumptions. We also take the opportunity to incorporate our Global ECS Research team's new currency forecasts. Accordingly, we make minor EPS changes (c. -1%). On the back of this we raise our P/E-based 12-month price target to A$4.00 from A$3.90. No change to our Buy rating.


Key risks

Downside: Accelerated price deflation through competition or government-led austerity measures, a higher A$.

from GS


not often talked about, and a long slow turn-around (it would bhave been hard to keep the faith) but an Australian success story

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Hi Mullokintyre


Gee the resmed is doing really nicely; going to hang on to them at this stage. Bet you were pleased to grab some more a month ago. Most of the health stocks to expensive to buy now. In fact I find most of the stocks I like are too dear to buy at present and my specie is below what I paid for it.So only what low risk purchases











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