Signing more contracts, especially larger and more lucrative ones, helped Craneware (CRW) increase its adjusted cash profits by 6 per cent in the half-year to December. The company, which sells payment-processing and risk-assessment software to hospitals, has been buoyed by demand from the fast-changing US healthcare market.
America’s hospitals handle payments by individuals, employers, insurers and various government branches - a task complicated by recent healthcare legislation. Craneware helps them charge patients accurately and keep track of revenues. Demand for its products certainly looks solid. It agreed its first seven and nine-year contracts "for a few years", reports chief executive Keith Neilson. The company also shook hands with several larger hospitals and hospital groups, including Aveva Health in the Midwest, which bought software for 28 of its 33 hospital organisations. That may relieve concerns that Craneware has mostly been adding small and mid-sized hospitals to its roster.
Prospects also seem healthy. Craneware's deferred income rose by 15 per cent to $18m (£11m), while its visible revenues for the three years ending 30 June 2016 - those under contract or expected to recur - rose from about $110m to $114m. Analysts at N+1 Singer expect adjusted pre-tax profits of $12m for the full year, giving EPS of 33¢ - up from $11m and 32¢ in fiscal 2013.
| CRANEWARE (CRW) | ||||
|---|---|---|---|---|
| ORD PRICE: | 585p | MARKET VALUE: | £158m | |
| TOUCH: | 575-595 | 12-MONTH HIGH: | 638p | LOW: 328p |
| DIVIDEND YIELD: | 2.1% | PE RATIO: | 31 | |
| NET ASSET VALUE: | 156¢ | NET CASH: | $30.6m | |
| Half-year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 20.1 | 4.5 | 12.1 | 5.2 |
| 2013 | 21.1 | 4.8 | 13.2 | 5.7 |
| % change | +5 | +7 | +9 | +10 |
Ex-div: 26 Mar Payment: 25 Apr *Includes intangible assets of $14.8m, or 55¢ a share £1=$1.66 | ||||
