An acquisitive strategy is delivering for Constellation Healthcare Technologies (CHT), with the three acquisitions made during the year helping to lift its headline operating profit by 76 per cent to $19.2m (£13.5m). The purchase of Physicians Practice Plus, Phoenix Health and Northstar First Health also boosted the number of doctors using Constellation's billing services to more than 9,000, moving the group closer towards its aim of becoming the largest US healthcare and technology services business.
In the short term, post-tax earnings have been diluted by fundraising and share-based payments for these businesses. The Aim-traded group raised a further £30m in a fundraising that closed in January. This allowed it to wipe the $12m of net debt that had built up at period-end and to purchase yet another business, MDRX Medical Billing.
The business model promotes good cash generation, and cash from operations increased by 91 per cent compared with 2014. This allowed for significant capital expenditure as the group builds up its technology, but it expects mostly maintenance rather than development costs in the near future.
Broker finnCap is expecting 2016 adjusted pre-tax profit of $30.3m and EPS at 21.7ȼ, up from $20m and 20.4ȼ the previous year.
CONSTELLATION HEALTHCARE TECHNOLOGIES (CHT) | ||||
|---|---|---|---|---|
| ORD PRICE: | 149p | MARKET VALUE: | £ 132m | |
| TOUCH: | 145-153p | 12-MONTHHIGH: | 188p | LOW: 137p |
| DIVIDEND YIELD: | Nil | PE RATIO: | 19 | |
| NET ASSET VALUE: | 69ȼ* | NET DEBT | 20% | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (ȼ) | Dividend per share (ȼ) |
|---|---|---|---|---|
| 2011** | 55.2 | -6.41 | na | nil |
| 2012** | 51.7 | -9.59 | na | nil |
| 2013** | 52.0 | 0.47 | na | nil |
| 2014 | 54.6 | 2.53 | 45 | 2.9 |
| 2015 | 76.7 | 11.4 | 11 | nil |
| % change | +41 | +350 | -76 | - |
Ex-div: na Payment: na *Includes intangible assets of $73.2m, or 83ȼ a share **Pre-IPO figures £1=$1.41 | ||||
