Fisher & Paykel Healthcare says encouraging demand and improving profit margins mean it expects annual net profit to be higher than previously flagged.
The company says it expects to report a net profit for the year ending March of about $97 million. It's previous guidance was for a result between $90 million and $95 million.
Managing director Mike Daniell says demand for a new range of masks used in the treatment of obstructive sleep apnea has been very encouraging.
Mr Daniell says that has driven volume growth and sales value and also helped with gross margin.
He says there has also been efficiency gains, with the teams in New Zealand and Mexico running lean manufacturing programmes that have delivered some very pleasing results.
Logistics around the world have also improved, he says.
On Tuesday Fisher & Paykel Healthcare shares rose as high as $4.20, matching their level on 23 January, which was the highest since February 2007.