EMIS Group: Preparing For The Next Stage Of Growth
Edison | Sep 04, 2018 05:37AM ET
Emis Group Plc (LON:EMISG) saw revenue growth from all divisions in H1, which helped to offset the additional costs incurred to strengthen service delivery. The company has worked hard to resolve customer support issues in primary care and is now focused on the IT Futures procurement bid in England. Investment in Patient is ongoing and the company expects to unveil its longer-term growth strategy at its capital markets day on 29 November. We have upgraded our revenue forecasts for FY18-20, but our adjusted operating profit and EPS forecasts are substantially unchanged.
Improving service delivery; preparing for growth
EMIS reported y-o-y revenue growth of 6.8% in H118, with growth from every division. Recurring revenues increased 4% y-o-y. Adjusted operating profit increased marginally over the period – investments in the Patient business combined with the increased headcount in Primary, Community and Acute Care to deal with customer support issues offset the upside from revenue growth in Community Pharmacy and Specialist and Care. EMIS noted that if the investment in Patient is excluded, adjusted operating profit increased 8% y-o-y. Net cash grew to £32.3m at the end of H118 from £14.0m at the end of FY17. The company announced an interim dividend of 14.2p (+10% y-o-y), ahead of our forecast.
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