[PPT] - EMIS Group plc 2012 results presentation Mike OLeary - Chairman PowerPoint Presentation

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Healthcare without boundaries

EMIS Group plc 2012 results presentation

Mike O’Leary - Chairman Peter Southby - CFO

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Introduction

Mike O’Leary Chairman

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Agenda

Introduction

Mike O’Leary

Financial Review

Peter Southby

Operational Review

Mike O’Leary

Summary and Outlook

Mike O’Leary

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Financial review

Peter Southby CFO

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Financial highlights

Total revenue of £86.3m (2011: £73.2m), up 18%
Recurring revenue of £69.4m (2011: £61.1m), up 14%
Group operating profit:
Reported - £24.1m (2011: £21.5m), up 12%
Adjusted(1) - £22.8m (2011: £20.8m), up 10%
Cash generated from operations(2) of £27.4m (2011: £27.1m)
Net cash at £7.7m (2011: £8.0m)
EPS:
Reported – 32.55p (2011: 28.71p), up 13%
Adjusted(1) – 30.76p (2011: 27.69p), up 11%
Total dividend 14.2p (2011: 12.4p), up 15%, including final

dividend 7.1p (2011: 6.2p)

(1)

Excludes exceptional items/capitalised development costs and adds back amortisation. For EPS also adjusts for related tax impact.

(2)

Adjusted to exclude internal development costs capitalised of £5.3m (2011: £3.8m).

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£m Year ended 31 December H1 2012 H2 2012 FY 2012 FY 2011 % Increase Revenue 42.3 44.0 86.3 73.2 18% Adjusted operating profit 11.5 11.3 22.8 20.8 10% Capitalised development costs 2.2 3.1 5.3 3.8 Amortisation (1.7) (1.9) (3.6) (3.1) Exceptionals/other 0.1 (0.5) (0.4) (0.1) Profit before tax 12.1 12.0 24.1 21.4 12% Tax (2.3) (2.3) (4.6) (4.4) Minority Interest/other (0.3) (0.3) (0.6) (0.2) Earnings 9.5 9.4 18.9 16.8 Adjusted EPS 15.6p 15.2p 30.8p 27.7p 11% Reported EPS 16.3p 16.2p 32.5p 28.7p 13%

Profit and loss

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Revenue increase driven by EMIS Web roll-out
Adjusted operating profit up by 10% despite £2.5m H2 increase in staff costs
2012 underlying tax rate 23% excluding deferred tax rate change

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Segmental analysis

£m (rounded) Year ended 31 December 2012 2011 % Increase EMIS RX Total EMIS RX Total Revenue 69.8 16.5 86.3 59.6 13.6 73.2 18% Of which recurring revenue 56.7 12.7 69.4 49.7 11.4 61.1 14% Segmental operating profit 22.5 3.0 25.5 20.7 1.6 22.3 Capitalised development costs (5.3)

(5.3)

(3.8)

(3.8)

Amortisation 2.7 0.8 3.5 2.2 0.9 3.1 Adjusted segmental profit 19.9 3.8 23.7 19.1 2.5 21.6 10% Group costs (0.9) (0.8) Adjusted operating profit 22.8 20.8 10% 7

EMIS growth driven by EMIS Web roll-out including hosting, training
Cost base scaled up with average staff numbers 24% higher (1,236 at 31 December 2012, average for

year 1,116)

RX benefited from £1.6m EPS R2 revenue and growth in estate

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Core business analysis

£m Year ended 31 December H1 2012 % of sales H2 2012 % of sales FY 2012 % of sales FY 2011 % of sales Licenses and software support 17.8 42% 18.6 42% 36.4 42% 33.2 45% Other support services 9.9 23% 12.2 27% 22.1 26% 20.3 28% Hosting 3.9 9% 5.1 13% 9.0 10% 5.8 8% Hardware and training 7.0 17% 6.1 14% 13.1 15% 10.4 14% Other 3.7 9% 2.0 4% 5.7 7% 3.5 5% Total 42.3 100% 44.0 100% 86.3 100% 73.2 100% Recurring 34.4 81% 35.0 80% 69.4 80% 61.1 83% Non-recurring 7.9 19% 9.0 20% 16.9 20% 12.1 17% Total 42.3 100% 44.0 100% 86.3 100% 73.2 100%

Recurring revenue growth £8.3 m – EMIS £7.0m and RX £1.3m
£3.2m growth in hosting driven by EMIS Web roll-out
High level of visibility through recurring revenue

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Cash flow

£m Year ended 31 December FY 2012 FY 2011 Operating profit 24.1 21.5 Depreciation and amortisation 8.5 6.5 Working capital 0.1 2.9 Cash flow from operating activities 32.7 30.9 Development costs capitalised (5.3) (3.8) Cash from operations 27.4 27.1 Discontinued operation

(0.8)

Contingent consideration for acquisition (0.8) (0.2) Net capex (12.8) (6.2) Transactions in own shares (1.8) (0.9) Tax paid (4.6) (5.6) Dividends (7.7) (6.9) Other

(0.1)

Change in net cash in year (0.3) 6.4 9

Cash from operations at £27.4m
Capex includes:
Hosting assets (£6.0m)
Computer equipment (£2.5m)
Motor vehicles (£2.0m)
Refurbishment costs (£1.5m)
Net cash broadly unchanged at £7.7m

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Balance sheet

£m Year ended 31 December FY 2012 FY 2011 Goodwill 22.0 22.0 Other intangible assets 30.8 28.6 Property, plant & equipment 22.1 14.8 Associate and other current assets 19.2 16.2 Deferred income (15.9) (16.1) RX contingent consideration

(0.8)

Other current liabilities (14.3) (10.5) Deferred tax (7.5) (8.1) Net cash 7.7 8.0 Net assets 64.1 54.1 10

Strong balance sheet with £11.1m in

cash / £3.4m debt

Investment in PPE
Deferred income steady and provides

good revenue visibility

Cost of final proposed dividend

£4.1m

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Operational review

Mike O’Leary Chairman

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Summary

UK GP software market share maintained:
New basis - UK 51.2% (5,113 practices) - (2011: 51.6% - 5,247 practices)*
Old basis – UK 53.7% (5,367 practices) – (2011: 53.1% - 5,397 practices)*
EMIS Web GP moved into accelerated roll-out - by the year end:
1,635 GP practices live (2011: 360)
1,252 unfulfilled orders (2011: 1,565)
2,564 practices in EMIS Web GP familiarisation service (2011: 2,359)
RX Systems:
High street pharmacy market share increased to nearly 35% (4,595 pharmacies) from 34%

(4,338 pharmacies)

EPSR2 successfully rolled out to 83% of estate
New Group HQ successfully refurbished and occupied
Transformation of healthcare delivery in the UK opening up new markets:
EMIS Web integrated care projects progressing
EMIS Web Mobile developed and launched
EMIS IQ GPES contract being delivered
Healthcare Gateway beginning to gain traction

* New basis installed systems only * Old basis installed plus orders not deployed

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Operational review – EMIS GP systems

Business continues to perform well
UK market leader
GP System of Choice framework agreement – extension in hand
Cross selling and development in Scotland
NHS Wales opportunities

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GP market-leading position maintained

(EMIS and competitor data estimated based on company records showing customers installed as at 31 December 2012)

Country EMIS estate

%

InPS estate

%

iSoft estate

%

TPP estate

%

Other

%

Total England 4,284

52.5

1,428

17.5

371

4.5

1,916

23.5

165

2.0

8,164 Scotland 517

51.5

486

48.4

1

0.1

1,004

Wales 152

31.9

251

52.7

69

14.5

4

0.9

476 Northern Ireland 160

45.7

113

32.3

51

14.6

26

7.4

350 UK Total 5,113

51.2

2,278

22.8

492

4.9

1,916

19.2

195

1.9

9,994 14

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EMIS Web GP

Accelerated roll-out to GPs:
1,635 GP practices using EMIS Web by the year end (2011: 360)
Familiarisation Service in 2,564 practices (2011: 2,359)
Total of 1,252 unfulfilled orders for EMIS Web by year end (2011:

1,565)

Total orders as of March 2013: 1,200
Average rollout 150 EMIS Web practices per month
Expect to deploy substantially all outstanding GP order

book by end 2013

EMIS Web Mobile released
2,000th EMIS Web site installed

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EMIS Web Integrated care

Pathfinder pilot projects progressing
Created ring fenced resource in

sales, commercial development and software development

This opens a significant opportunity

in the next few years

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Healthcare Gateway and EMIS IQ

Healthcare Gateway

Gaining traction
Now includes all major GP Suppliers

EMIS IQ

Delivered under the national General Practice Extraction Service (GPES)

Patient.co.uk

Helps patients play a part in their own care
42% growth in total visits
Patient Access App launched in March 2013

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NHS Commissioning – EMIS at the heart

Context:

Public Finance
Demographics and LTCs
Patient Care

NHS Commissioning Board

£80 billion Commission budget split
£20 billion centrally commissioned
£60 billion CCGs
212 CCGs to come into being on 1 April 2013

The Way Forward “We will guarantee every patient the opportunity of online access to their own primary care medical record by the spring of 2015” “We will expect commissioners to promote the benefits of technology in improving outcomes” “We will support commissioners to provide patients with access to digital tools to help them manage health and care as they choose and shall also support a move to paperless referrals in the NHS by March 2015”

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Strategic direction for EMIS Group

Starting point – strong patient record market share in primary care

(GPs)

Extending across the spectrum of healthcare
Build or inter-operate
Timeframe – medium/long term opportunity
Quantum – order of magnitude larger market opportunity

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Summary and outlook

Summary

Strong performance:

UK GP software market leading position maintained
RX Systems market share increased
New market initiatives progressing

Investment in delivery capability for EMIS Web

Outlook

Strong and growing revenue visibility
Trading in-line with management expectations

since the year-end

EMIS Web accelerated roll-out continues
Continued development of EMIS Web into the

wider NHS with exciting prospects delivering integrated care systems

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Q & A

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APPENDIX

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GP practices Nursing and in patient services Specialist

District nurse service

133

MacMillan nurses

11

Tissue viability

7

Podiatry Community physiotherapy

30 15

Speech and language therapy

22

LV PCS

18 3

EMIS Web

41

Community respiratory Vasectomy

15 4

Eden specialist services

23

Other

19

Cumbria partnership foundation trust Long term conditions

17

Step up step down

107

STINT

30

Furness community services

134

Cumbria smoking cessation

31

Copeland specialist services

85

Continence services

19

Carlisle community services

102

NHS Trusts

North Cumbria University hospitals University hospitals Morecambe bay

Key

Live Coming soon

No. of

practices

No. of

users February 2013 Copeland community services

109

Community nursing liaison

10

Consultant- led services

Diabetes Sexual health service

47 42

Neurology service

36

Eden community

189

Furness specialist services

2

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GP Practices Central and East Cheshire PCT

LV PCS 9 3 EMIS Web 37 Other 4 Key Coming soon

No. of

practices

No. of

users

GP Practices NHS Western Cheshire

LV PCS 2 1 EMIS Web 29 Other 11 Live

Adult and children’s nursing services

118

Allied health professionals

165

Pharmacy

2

Cheshire and Wirral Partnership

MHCT diabetes services

5

MCHT A&E, UCC & OOH

5

Health record and community administration

7

East Cheshire

ECNT AHPs, therapies and rehab

217

ECNT adult nursing services

246

ECNT A&E

6

ECNT pharmacy

15

Mid Cheshire Hospitals NHS Foundation trust

1

MCHT Pharmacy Countess of Chester A&E

2

February 2013

1

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Outside of Hospitals Services – Primary & Community Aintree emergency department Heart failure service LCH heart failure team Liverpool heart and chest hospital PCI/CCU Secondary Care Services

Liverpool PCT & NHS Sefton

February 2013 RLBUHT eye screening and ophthalmology RLBUHT diabetes Ankle-Brachial pressure index 23 Anti-coagulation 2 Asylum seekers 2 Children’s walk-in centre 2 Community matrons 62 Community respiratory team 67 Diabetes specialist nurses 50 Emergency response team 4 Gynaecology 22 H.Pylori breath test 13 Hepatitis C 1 Intermediate care units 4 IV therapy 1 Care resolution home team 4 District nursing 379 HIV service 3 Dermatology ICATS 14 Minor surgery 64 UC24 1 Medicines mgmt care home service 4 Weight management service 30 Homeopathy 3 Key Coming soon

No. of

practices

No. of

users Live PCS 27 47 EMIS Web 18 Other 6 Acute medical unit General practices Key Southport and Ormskirk emergency department RLBUHT renal department Royal Liverpool university hospital A&E department Southport and Ormskirk ICO stroke specialist nurses Southport and Ormskirk ICO sexual health team Southport and Ormskirk ICO pharmacy team Southport and Ormskirk ICO diabetes team Renal service 1 RLBUHT heart failure Southport and Ormskirk paediatric A&E LV Children’s services 266 Community health 41 13 2 1 46 2 3 1 1 3 44 3 1 1 1 1 3 Liverpool PCT 25

73 unique services, and 195 services in total

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APPENDIX

73 unique community and extended care services are already live with EMIS Web Acquired brain injury, Anticoagulation, Asylum seekers, Child services, Clinical assessment service, Clinical effectiveness group, Community hospital, Community matrons, Continence service, Contraceptive service, COPD inc rehabilitation, Crisis resolution team, Cystic fibrosis, Dermatology, Diabetes, Diabetic retinopathy, Dieticians, District nurse service, Emergency department, A&E and UCC, Flu pandemic service, General paediatrics, Gynaecology service, H1N1 influenza at risk data collection, Health IV therapy service, Health treatment rooms service, Heart and chest hospital, Heart failure service, H-Pylori breath test, Joint injections, Learning disabilities, Long term conditions, MacMillan Nurses, Medicine management, Minor surgery, Musculoskeletal ultrasound, Nursing home, Occupational therapy service, Older people and rehab service, Ophthalmology, Out of hours, Palliative care, Physiotherapy service, Podiatry, Polyclinics, Primary care access service, Primary care psychology, Public health, Renal department, Respiratory services, Smoking cessation, Speech and language therapy, Short term interventions, Ultrasound, Urology, Vasectomy, Walk-in centre, Weight management service. 26

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APPENDIX Chris Spencer

Chris Spencer joined EMIS in 1999 and, until 2013, was EMIS’s Chief Administrative Officer including roles as Group Counsel and Company

Secretary. He has been a member of EMIS’s

senior management strategy forum since 1999. Immediately prior to joining EMIS, he was a General Manager and Head of IT for Markgraaf Patents Limited. A qualified solicitor, Chris was also, in 1985, a founder shareholder and director

f Solicitec Limited, a software house which was

acquired by Lexis Nexis in 2006. He is an Associate of the Chartered Institute of Patent Agents, a member of the Law Society of England & Wales, a member of the Society for Computers & Law and a Fellow of the Chartered Management Institute.

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APPENDIX

(EMIS and competitor data estimated based on company records showing customers installed and ordered (by contract or letter of intent) as at 31 December 2012)

Country EMIS estate EMIS %

England 4,502 55.1% Scotland 518 51.6% Wales 168 35.3% Northern Ireland 179 51.1% UK Total 5,367 53.7%

(EMIS and competitor data estimated based on company records showing customers installed as at 31 December 2012)

Country EMIS estate EMIS %

England 4,284 52.5% Scotland 517 51.5% Wales 152 31.9% Northern Ireland 160 45.7% UK Total 5,113 51.2%

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APPENDIX

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APPENDIX

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