H1 2011 Results Presentation 02 September 2011 1 healthcare without boundaries
Financial Highlights * • Revenue of £35.5m (H1, 2010: £28.7m), up 24% Group operating profit of £10.2m (H1, 2010: £9.0m (1) ), up 14% • • Cash generated from operations £20.5m (H1, 2010: £18.5m), up £2.0m • Net cash of £12.8m (H1, 2010: £10.5m), up £2.3m • EPS from continuing operations of 13.10 p (H1, 2010 adjusted: 11.38 p (1) ), up 15% • Interim dividend of 6.2p (H1, 2010: 5.6p), up 11% * H1 2011 includes Rx Systems (1) Adjusted for flotation and other transaction costs 2 healthcare without boundaries
Operational Highlights • UK GP software market leading position maintained: – UK market share 53.4% (H1, 2010: 53.8%): • 117 GP practices deployed in Scotland • total of 5,506 EMIS GP practices at period end (H1, 2010: 5,592 ) • GPSoC contract extended to March 2013 • EMIS Web roll-out continues: – 107 GP practices installed with 1,130 further orders placed – 2,091 practices in the EMIS Web familiarisation service • Rx Systems integration on track: – high street pharmacy systems market share increased from 25% to 30% • Canadian exit completed in all material respects • Internal refocus to address commercial opportunities 3 healthcare without boundaries
Financial Review 4 healthcare without boundaries
Profit and Loss £m H1 H1 % • Revenue increased by 23.5%: Continuing operations 2011 2010 Change – includes £2.7m accredited hosting Revenue 35.5 28.7 23.5% • Adjusted operating profit increased Operating profit 10.2 8.0 27.3% by 13.8% - adjusted 9.0* 13.8% Profit before tax 10.2 7.8 31.2% • Tax rates lower - adjusted 8.8 * 16.9% • CT 26.5% average • DT 2% reduction on all intangibles Tax (2.4) (2.4) - • Adjusted EPS up 15.1% Profit after tax 7.8 5.4 44.7% 6.2 26.0% - adjusted EPS 13.10p 9.91p 32.1% - adjusted 11.38 * 15.1% * 2010 H1 adjusted for float/transaction costs: - Operating profit/PBT - £0.96m - PAT and EPS, net of tax relief, £0.8m 5 healthcare without boundaries
Segmental Analysis £m H1 2011 H1 2010 EMIS Rx EMIS and Rx EMIS Systems Systems total Revenue 29.1 6.4 35.5 28.7 including: Recurring revenue 24.5 5.4 29.9 23.3 Segmental operating profit*: 9.9 0.7 10.6 9.0 - add back amortisation 1.1 0.4 1.5 1.0 - deduct capitalised development costs (1.7) - (1.7) (2.0) Adjusted segmental operating profit 9.3 1.1 10.4 8.0 * As set out in note 9(b) of the financial statements. 6 healthcare without boundaries
Operational Revenues £m H1 % of H1 % of FY % of FY % of 2011 sales 2010 sales 2010 sales 2009 sales Licenses and software support 16.4 46% 13.1 46% 28.0 45% 25.8 45% Support services 9.7 27% 7.2 25% 16.6 27% 15.4 27% Hosting 2.8 8% 2.3 8% 5.2 8% 3.3 6% Hardware and training 5.1 15% 4.8 17% 9.6 16% 9.4 16% Other 1.5 4% 1.3 4% 2.5 4% 3.3 6% Total 35.5 100% 28.7 100% 61.9 100% 57.2 100% Recurring 29.9 84% 23.3 81% 50.8 82% 42.7 75% Non-recurring 5.6 16% 5.4 19% 10.9 18% 14.5 25% Total 35.5 100% 28.7 100% 61.9 100% 57.2 100% • Licenses and software support increased by £3.3m (25%) including £2.0m from Rx 7 healthcare without boundaries
Cash Flow £m H1 H1 FY 2011 2010 2010 Cash from operations: • Adjusted cash from operations Generated 21.2 19.8 24.2 increased by £1.7m Less internal development costs capitalised (1.7) (2.0) (3.8) Adjusted cash from operations 19.5 17.8 20.4 • Capex includes hosting assets of Used for: £0.8m Canadian discontinued activity (0.4) (1.3) (2.0) Acquisition of Rx Systems - - (3.2) Net capex (2.2) (2.4) (5.3) • Positive cash movement in 2011 Repayment of bank term loans (0.6) (0.6) (1.2) H1 of £10.6m Share issues - 24.1 24.1 Repayment of shareholder loans - (23.0) (23.0) Bank and other interest (0.1) (0.7) (0.4) Taxation (2.3) (2.3) (3.9) Interim dividend (3.3) (3.3) (8.9) (6.2) 18.2 Cash increase 10.6 11.6 2.2 8 healthcare without boundaries
Balance Sheet • Fixed assets – intangibles reduce by £m 30.06.11 31.12.10 £1.2m due to Canada impairment Fixed assets 65.3 65.9 • Deferred income continues to increase due to impact of Rx and Cash 18.0 7.4 growth of accredited hosting Other current assets 12.2 9.8 • Cash of £18.0m (2010 H1 was Total assets 95.5 83.1 £16.8m) • Bank term loans reduced to £5.2m Current liabilities (12.7) (10.3) • Deferred tax on intangibles reduces Deferred income (19.7) (10.9) via Income Account to £7.8m – no Bank term loans (5.2) (5.7) cash implications going forward Rx contingent consideration (0.7) (0.9) Deferred tax (7.8) (8.5) Net assets 49.4 46.8 9 healthcare without boundaries
Operational Review 10 healthcare without boundaries
EMIS Group Overview • Key objectives for H1 2011 achieved: – EMIS Web roll out – Scottish GP installations underway – Rx Systems growth and synergies • Delivery of cross-organisational healthcare strategy: – Primary and community healthcare wins • EMIS Group’s strategy aligned with new NHS White Paper • Wider application beyond the NHS: – Australian Armed Forces 11 healthcare without boundaries
EMIS Web Update • Roll-out continues: – 107 GP practice installations completed – 1,130 further orders placed for EMIS Web – 2,091 GP practices using the familiarisation service – Since the period end, installation has been completed at a further 78 GP practices • Building up resources to deliver accelerating roll out • In negotiation with a number of PCTs and Clinical Commissioning Groups regarding EMIS Web in extended primary and community healthcare settings • Various pathfinder services deployed or being deployed in extended primary care 12 healthcare without boundaries
Market Opportunities • Strategy to deliver cross-organisational healthcare systems • EMIS Group well positioned and aligned with Government strategy: – EMIS Web – Healthcare Gateway EMIS GP S ystems – Rx Systems GP GP GP Data streaming A&E Pathology S pecialist DN HV services Long term Maternity conditions NHS GP ICU Network Diabetes Hospital pharmacy Extended Emis IQ – services business Child Inpatient Out of intelligence health hours for GP consortia 13 healthcare without boundaries
Rx Systems • Rx Systems: – A leading pharmacy software and services company – 3,849 high street pharmacy sites – UK market share has now increased from 25% to 31% – 84% recurring revenues – Cash generative • Combination of EMIS and Rx Systems will enable: – Online connection between patient, GP and pharmacist – More efficient prescription flows – Improved links to Electronic Healthcare Record – Cross-selling opportunities within EMIS Group 14 healthcare without boundaries
Healthcare Gateway • JV between EMIS and InPS: – Covers 75% of UK GP practice data – Facilitates sharing of patient data • Benefits include potential to significantly increase NHS efficiency and improve patient care • Enables real time interoperability between GPs using EMIS/InPS and other healthcare professionals • NHS interoperability standard accredited • Product development and pilots underway 15 healthcare without boundaries
Current Trading and Outlook • Controlled roll-out of EMIS Web progressing • Strong revenue visibility continues: – GPSoC framework agreement extended until 2013 • Key themes of second half performance in 2011: – EMIS Web controlled roll-out – Increasing hosting revenues – Scotland revenue growing • EMIS Group continues to trade in line with management expectations. • Remain optimistic for the full year and confident in the Group’s long term growth prospects. 16 healthcare without boundaries
Appendix 17 healthcare without boundaries
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