The ball is rolling on the migration of Craneware’s (CRW) customers to its new cloud software platform, Trisus. The US-focused healthcare services company launched the first product in the new suite in June and management has been encouraged by its early uptake.
But Trisus’ launch caused a short term drop in Craneware’s average contract length (from five to four years) which sent reported new sales down 40 per cent to $35.4m (£27m) in the period. The fact that fewer contracts were up for renewal this year also caused a 34 per cent drop in the total value of group contracts to $54m.
No matter. Adjust for the one-off contraction to contract length, and new product sales on a like-for-like basis were actually up to over $60m. This, added to the group’s strong market growth in recent years and its 110 per cent contract renewal rate, means total visible revenue for the next three years currently stands at $164m. With $56m of that expected to be recognised in the next financial year, Craneware has already booked over 80 per cent of Peel Hunt’s FY2018 revenue forecast. The broker is expecting pre-tax profits of $20.3m, giving EPS of 50.7ȼ (from $17.8m and 50.3ȼ in FY2017).
CRANEWARE (CRW) | ||||
ORD PRICE: | 1,325p | MARKET VALUE: | £358m | |
TOUCH: | 1300-1350p | 12-MONTH HIGH / LOW: | 1,365p | 960p |
DIVIDEND YIELD: | 1.2% | PE RATIO: | 34 | |
NET ASSET VALUE: | 220ȼ* | NET CASH: | $53.2m |
Year to 30 Jun | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (ȼ) | Dividend per share (p) |
2013 | 41.5 | 10.6 | 30.7 | 11.5 |
2014 | 42.6 | 11.3 | 31.9 | 12.5 |
2015 | 44.8 | 12.5 | 35.0 | 14.0 |
2016 | 49.8 | 13.9 | 39.4 | 16.5 |
2017 | 57.8 | 16.9 | 50.2 | 20.0 |
% change | +16 | +21 | +27 | +21 |
Ex-div: | 9 Nov | |||
Payment: | 7 Dec | |||
*Includes intangible assets of $19.8m, or 73.5ȼ a share £1=$1.3 |