Government NHS reforms will see currently ringfenced health budgets formally pass to clinical commissioning groups during this year. Within that shift is a growing focus on sharing patient information electronically, leaving EMIS (EMIS) - which provides the software to allow healthcare professionals to do just that - looking well placed.
At end-December 2012, EMIS supplied just over half of the UK's GP practices with software that allows patients' notes to be transferred electronically. But the growth in this market is increasingly going to come from running such services off-site - so the company is switching over the surgeries to its own server at the rate of up to 200 a month. Apart from double-digit increases in sales, profits and earnings in 2012, the really attractive figures last year came from recurring revenues - which continue to account for around 80 per cent of total sales. What's more, cash generated from operations reached £27.4m, which helped fund a big increase in capital spending.
Long-serving chief executive Sean Riddell announced his retirement in February and Chris Spencer has taken the helm on a temporary basis until a new boss can be found. Broker Numis Securities expects pre-tax profit of £25m for 2013, giving adjusted EPS of 32.4p (from £22.8m and 30.5p in 2012).
EMIS (EMIS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 633p | MARKET VALUE: | £371m | |
| TOUCH: | 620-645p | 12-MONTH HIGH: | 980p | LOW: 450p |
| DIVIDEND YIELD: | 2.2% | PE RATIO: | 19 | |
| NET ASSET VALUE: | 103p* | NET DEBT: | £7.7m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 57.7 | 14.5 | 19.9 | nil |
| 2010 | 61.9 | 18.1 | 23.3 | 11.2 |
| 2011 | 73.2 | 21.4 | 28.7 | 12.4 |
| 2012 | 86.3 | 24.1 | 32.6 | 14.20 |
| % change | +18 | +13 | +14 | +15 |
Ex-div: 17 Apr Payment: 3 May *Includes intangible assets of £52.8m, or 90p a share Aim: software & computer services | ||||
