Quarterly Financial Information as of June 30,
2017
IFRS - Regulated Information - Not Audited
Cegedim: all divisions helped
grow like-for-like revenues in first half 2017
-
Like-for-like revenues rose 6.4% in H1
2017
-
Business model transformation is still going
strong
-
Cegelease business slated for sale
Disclaimer: This press release is available in
French and in English. In the event of any difference between the
two versions, the original French version takes precedence. This
press release may contain inside information. It was sent to
Cegedim's authorized distributor on July 27, no earlier than 5:45
pm Paris time. The following terms are defined in the
Glossary. |
Conference CALL on July 27, 2016, at 6:00PM
CET |
FR: +33 1 72 00 15 10 |
USA: +1 646 722 4907 |
UK: +44 (0)20 3043 2440 |
PIN Code:30006191# |
The webcast is available at the following
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Boulogne-Billancourt, France,
July 27, 2017 after the market close
Cegedim, an innovative technology
and services company, posted consolidated Q2 2017 revenues of
€116.9 million, up 7.0% on a reported basis and 6.0% like-for-like
compared with the same period in 2016.
For the first
half of 2017 consolidated revenues came to €230.6 million up 7.0%
on a reported basis and 6.4% like-for-like compared with the same
period in 2016.
All of the divisions helped grow
the Group's like-for-like (LFL) growth in the second quarter and
first half compared with a year ago.
Growth at the Health insurance, HR and e-services division remained
robust, with year-on-year (y/y) increases LFL of 7.3% in the second
quarter and 9.8% in the first half of 2017.
Over the same period, the
Healthcare professionals division returned to
LFL growth in the second quarter. It's 3.8% y/y increase brought
the division's LFL first-half growth to 1.4% compared with the
year-earlier period. Growth was buoyed by computerization solutions
for pharmacists, doctors, nurses and physical therapists in France,
and for doctors in Belgium, Spain and the US. Cegelease, the financial lease business, also helped
boost revenues.
Part of this growth came from the
Group's BPO businesses, most of which are still ramping up their
operations. As a result, they will negatively affect Group
profitability in 2017.
The business model transformation
initiated in fall 2015 is beginning to pay off, and we expect to
see the full impact in 2018.
To continue its business model
transformation and refocus its strategy, Cegedim is contemplating
divestment of its Cegelease and Eurofarmat subsidiaries. These subsidiaries operate
principally in the financial domain, are highly valued, and require
additional resources to continue pursuing and accelerating their
development for the benefit of their clients and employees.
Revenue trends by
division
|
|
Second quarter |
In € million |
|
2017 |
2016 |
Chg. L-f-l |
Chg. Reported |
Health
insurance, HR and e-services |
|
71.7 |
64.8 |
+7.3% |
+10.5% |
Healthcare professionals |
|
44.3 |
43.7 |
+3.8% |
+1.5% |
Activities not allocated |
|
0.9 |
0.8 |
+19.4% |
+19.4% |
Cegedim |
|
116.9 |
109.3 |
+6.0% |
+7.0% |
In the second quarter of 2017,
Cegedim posted consolidated revenues of €116.9
million, up 7.0% on a reported basis. Excluding an unfavorable
currency translation effect of 1.1% and a 2.1% boost from
acquisitions, revenues rose 6.0%.
The unfavorable currency
translation effect of €1.2 million, or 1.1%, was chiefly due to the
€1.3 million negative impact of the pound sterling, which
represents 10.7% of Group revenues.
The €2.3 million positive impact
from acquisitions, or 2.1%, was mainly due to the acquisition of
Futuramedia in France in
November 2016.
All of the divisions improved in
like-for-like terms. Health insurance, HR and
e-services division revenues rose by 7.3%, and Healthcare professionals division revenues rose by
3.8%.
|
|
Half-year |
In € million |
|
2017 |
2016 |
Chg. L-f-l |
Chg. Reported |
Health
insurance, HR and e-services |
|
140.3 |
124.6 |
+9.8% |
+12.6% |
Healthcare professionals |
|
88.4 |
89.4 |
+1.4% |
(1.1)% |
Activities not allocated |
|
2.0 |
1.6 |
+26.2% |
+26.2% |
Cegedim |
|
230.6 |
215.5 |
+6.4% |
+7.0% |
In the first half of 2017,
Cegedim posted consolidated revenues of €230.6
million, up 7.0% on a reported basis. Excluding an unfavorable
currency translation effect of 1.2% and a 1.8% boost from
acquisitions, revenues rose 6.4%.
The unfavorable currency
translation effect of €2.6 million, or 1.2%, was chiefly due to the
€2.8 million negative impact of the pound sterling, which
represents 10.9% of Group revenues.
The €3.9 million positive impact
from acquisitions, or 1.8%, was mainly due to the acquisition of
Futuramedia in France in
November 2016.
All of the divisions improved in
like-for-like terms. Health insurance, HR and
e-services division revenues rose by 9.8%, and Healthcare professionals division revenues rose by
1.4%.
Analysis of business trends by
division
The division's
first half 2017 revenues came to €140.3 million, up 12.6% on a
reported basis. The November 2016 acquisition of Futuramedia in
France made a positive contribution of 3.1%. Currency effects made
a negative contribution of 0.3%. Like-for-like revenues rose 9.8%
over the period.
The Health
insurance, HR and e-services division
represented 60.8% of consolidated revenues, compared with 57.8%
over the same period a year earlier.
The division's
second quarter 2017 revenues came to €71.7 million, up 10.5% on a
reported basis. The November 2016 acquisition of Futuramedia in
France made a positive contribution of 3.5%. Currency effects made
a negative contribution of 0.3%. Like-for-like revenues rose 7.3%
over the period.
Growth was driven mainly by:
-
Continued double-digit growth at Cegedim SRH, as work began with several new clients of
the SaaS platform for HR management;
-
Strong sales momentum leading to the start of
work with several new clients of the SaaS platform for electronic
data exchange, Global Information
Services, including payment
platforms. As a result, Cegedim e-business posted double-digit revenue growth
in the first two quarters of 2017;
-
Double-digit growth in iGestion BPO activities for health insurance companies
and mutual insurers;
-
The continuation of positive trends - for
several quarters now - in third-party payment processing
services;
-
Modest growth in software and services for the
personal insurance market, despite the impact of switching to the
SaaS format.
The division's
first half 2017 revenues came to €88.4 million, down 1.1% on a
reported basis. Currency effects made a negative contribution of
2.5%. There was virtually no impact from acquisitions or
divestments. Like-for-like revenues rose 1.4% over the
period.
The Healthcare professionals division
represented 38.3% of consolidated revenues, compared with 41.5%
over the same period a year earlier.
The division's
second quarter 2017 revenues came to €44.3 million, up 1.5% on a
reported basis. Currency effects made a negative contribution of
2.4%. There was virtually no impact from acquisitions or
divestments. Like-for-like revenues rose 3.8% over the
period.
Second-quarter growth more than
offset the decline in the first quarter. The key performances
responsible for this positive trend were:
-
Double-digit Q2 growth from Pulse, the computerization of doctors, and the RCM
business in the US. RCM is a BPO-type business and is growing
rapidly, with double-digit growth over the first half that will
negatively affect EBITDA for the period;
-
Computerization products and services for
doctors in Belgium, Spain and France, and for French nurses,
physical therapists, speech therapists, orthoptists, midwives, and
podiatrists;
-
Computerization products and services for French
pharmacists, which returned to growth thanks to the Smart Rx launch of last September. The business
confirmed strong momentum in its order intake compared with a year
ago;
-
A good performance in the first half by the
BCB scientific database for prescription
assistance, prescription fulfillment, and health products.
-
Cegelease, the financial
lease business.
This performance was partly offset
by a decline in revenue of computerization solutions to UK doctors
pending the release of a full version in SaaS format. The first
modules arrived on the market early this year and were well
received.
The division's
first half 2017 revenues came to €2.0 million, up 26.2% both on a
reported basis and like for like. There were no currency effects
and no acquisitions or divestments.
The Activities not allocated division
represented 0.9% of consolidated revenues, compared with 0.7% over
the same period a year earlier.
The division's
second quarter 2017 revenues came to €0.9 million, up 19.4% both on
a reported basis and like for like. There were no currency effects
and no acquisitions or divestments.
This favorable trend reflects an
undemanding comparison and good development in the facilities
management and data hosting business, including for health data
hosting.
Highlights
Apart from the items cited below,
to the best of the company's knowledge, there were no events or
changes during the period that would materially alter the Group's
financial situation.
On February 10, 2017, Cegedim was ordered to pay €4,636,000 to the Tessi
company for failing to meet certain obligations with respect to an
asset sale made on July 2, 2007.
Cegedim has decided to appeal this
decision.
Cegedim,
jointly with IMS Health, is being sued by Euris for unfair
competition. Cegedim has filed a motion
claiming that IMS Health should be the sole defendant.
To hedge part of its exposure to
euro interest rate fluctuations arising from its RCF, the Group
carried out an interest rate swap on February 17, 2017. Under the
zero-premium swap agreement, Cegedim receives
the 1-month Euribor rate if it exceeds 0%, receives nothing
otherwise, and pays a fixed rate of 0.2680% for a notional amount
of €50 million, starting on February 28, 2017, and maturing
February 26, 2021.
To hedge part of its exposure to
euro interest rate fluctuations arising from its RCF, the Group
carried out an interest rate swap on May 11, 2017. Under the
zero-premium swap agreement, Cegedim receives
the 1-month Euribor rate if it exceeds 0%, receives nothing
otherwise, and pays a fixed rate of 0.2750% for a notional amount
of €30 million, starting on May 31, 2017, and maturing December 31,
2020.
On February 23, 2017, Cegedim acquired UK company B.B.M.
Systems through its Alliadis Europe Ltd
subsidiary. The deal strengthens the Group's expertise in
developing cloud-based products for general practitioners.
B.B.M. Systems had 2016 revenues
of around €0.7 million and earned a profit. It contributes to the
Group's scope of consolidation from March 1, 2017.
In keeping with the wishes of
BPIFrance, Ms. Anne-Sophie Hérelle has been appointed to replace
Ms. Valérie Raoul-Desprez on the Board of Directors. The permanent
representative of BPIFrance, is now Ms. Marie Artaud-Dewitte,
Deputy Head of Legal Affairs at Bpifrance Investissements. She
replaces Ms. Anne-Sophie Hérelle.
On May 3, 2017, Cegedim acquired UK company Adaptive
Apps through its In Practice Systems
Limited subsidiary. The deal strengthens the Group's expertise
in developing cloud-based and mobile products for healthcare
professionals.
Adaptive Apps
had 2016 revenues of around €1.5 million and earned a profit. It
contributes to the Group's scope of consolidation from May,
2017.
Significant post-closing
transactions and events
To the best of the company's knowledge, apart from
the items cited below, there were no events or changes after the
accounts were closed that would materially alter the Group's
financial situation.
On July 21, 2017, Cegedim paid €4,636,000 to the Tessi company to comply
with a court ruling of February 10, 2017.
Cegedim has decided to appeal
this decision. The appeal is currently under way
As part of the business model transformation plan
that the Group initiated in fall 2015, Cegedim is contemplating
divestment of its Cegelease and Eurofarmat subsidiaries. These subsidiaries operate
principally in the financial domain, are highly valued, and require
additional resources to continue pursuing and accelerating their
development for the benefit of their clients and employees.
The two businesses have 24
employees in France. In 2016 they contributed €5.4 million to Group
consolidated EBITDA. The subsidiaries' standalone EBITDA amounted
to €18.1 million in 2016.
If the Group receives satisfactory
offers and is able to obtain the necessary approvals, it plans to
close the deal in the second half of 2017. The Group in no way
guarantees that a deal will be carried out.
A successful sale would give the
Group a portfolio of businesses that fit well together and generate
strong synergies. Cegedim is not planning any
further divestments.
Assisting Cegedim on this transaction are the consulting firm of
Ohana & Co and the law firm of Freshfields Bruckhaus
Deringer.
Outlook
Cegedim
continues to reinvent itself in 2017, pursuing innovation and
investing in the future by transforming its business model. The
business model transformation is well under way, so growth momentum
is expected to continue and lead to improving profitability in the
future.
Even though our first-half revenue
growth was stronger than our current guidance and we do not expect
trends in the Group's core businesses to change, Cegedim is reiterating its full-year outlook of:
The above outlook does not reflect
the potential divestments of Cegelease and
Eurofarmat.
Cegedim
expects to see the full positive impact of its investments,
reorganization and transformation in 2018.
The Group does not expect any
significant acquisitions in 2017 and does not disclose earnings
projections or estimates.
In 2016, the UK accounted for
12.7% of consolidated Group revenues and 14.8% of consolidated
Group EBIT.
Cegedim deals
in local currency in the UK, as it does in every country where it
is present. Thus Brexit is unlikely to have a material impact on
Group EBIT.
With regard to healthcare policy,
the Group has not identified any major European programs at work in
the UK and expects UK policy to be only marginally affected by
Brexit.
The figures cited above include
guidance on Cegedim's future financial
performances. This forward-looking information is based on the
opinions and assumptions of the Group's senior management at the
time this press release is issued and naturally entails risks and
uncertainty. For more information on the risks facing Cegedim, please refer to points 2.4, "Risk factors and
insurance", and 3.7, "Outlook", of the 2016 Registration Document
filed with the AMF on March 29, 2017, under number D.17-0255.
|
September 21, 2017, after market closing
September 22, 2017, at 2:30 pm
October 26, 2017, after market closing |
Half-year
2017 earnings
Analyst meeting (SFAF)
Q3 2017 revenues |
Financial calendar
July 27, 2017, at 6:00pm
(Paris time) |
The Group
will hold a conference call hosted by Jan Eryk Umiastowski, Cegedim
Chief Investment Officer and Head of Investor Relations.
The webcast is available at the following address:
http://bit.ly/2uM93g1
The second quarter 2017 revenue presentation is available
at:
The website:
http://www.cegedim.fr/finance/documentation/Pages/presentations.aspx
The Group's financial communications app, Cegedim IR. To download
the app, visit:
http://www.cegedim.fr/finance/profil/Pages/CegedimIR.aspx |
Contact Numbers : |
France : +33 1 72 00 15 10
United States : +1 646 722
4907
UK and others : +44
(0)20 3043 2440 |
PIN Code: 30006191# |
Additional information
Q2 2017 revenue figures have not been audited
by the Statutory Auditor. |
Annexe
Breakdown of revenue by quarter
and division
In € thousands |
|
Q1 |
Q2 |
Q3 |
Q4 |
Total |
Health insurance, HR and e-services |
|
68,606 |
71,650 |
- |
- |
140,256 |
|
Healthcare professionals |
|
44,045 |
44,334 |
- |
- |
88,379 |
|
Activities not allocated |
|
1,054 |
930 |
- |
- |
1,983 |
|
Cegedim |
|
113,705 |
116,913 |
- |
- |
230,618 |
|
In € thousands |
|
Q1 |
Q2 |
Q3 |
Q4 |
Total |
Health insurance, HR and e-services |
|
59,728 |
64,847 |
60,607 |
77,143 |
262,325 |
|
Healthcare professionals |
|
45,687 |
43,676 |
41,459 |
44,404 |
175,226 |
|
Activities not allocated |
|
793 |
778 |
770 |
954 |
3,295 |
|
Cegedim |
|
106,208 |
109,301 |
102,836 |
122,501 |
440,846 |
|
Breakdown of revenue by
geographic zone and division
In € thousands |
|
France |
EMEA excl. France |
Americas |
APAC |
Health insurance, HR and e-services |
|
96.9% |
3.1% |
- |
- |
Healthcare professionals |
|
60.5% |
30.4% |
9.1% |
- |
Activities not allocated |
|
99.5% |
0.5% |
- |
- |
Cegedim |
|
83.0% |
13.5% |
3.5% |
- |
Breakdown of revenue by currency
and division
In € thousands |
|
Euro |
GBP |
USD |
Others |
Health insurance, HR and e-services |
|
96.9% |
2.0% |
0.0% |
1.1% |
Healthcare professionals |
|
64.6% |
25.3% |
9.0% |
1.1% |
Activities not allocated |
|
100.0% |
0.0% |
0.0% |
0.0% |
Cegedim |
|
84.6% |
10.9% |
3.4% |
1.1% |
Activities not allocated: This
division encompasses the activities the Group performs as the
parent company of a listed entity, as well as the support it
provides to the three operating divisions.
BPO (Business Process Outsourcing): BPO is the
contracting of non-core business activities and functions to a
third-party provider. Cegedim provides BPO services for human
resources, Revenue Cycle Management in the US and management
services for insurance companies, provident institutions and mutual
insurers.
Business model transformation: Cegedim decided
in fall 2015 to switch all of its offerings over to SaaS format, to
develop a complete BPO offering, and to materially increase its
R&D efforts. This is reflected in the Group's revamped business
model. The change has altered the Group's revenue recognition and
negatively affected short-term profitability
EPS: Earnings Per Share is a specific
financial indicator defined by the Group as the net profit (loss)
for the period divided by the weighted average of the number of
shares in circulation.
Operating expenses: Operating expenses is
defined as purchases used, external expenses and payroll
costs.
Revenue at constant exchange rate: When
changes in revenue at constant exchange rate are referred to, it
means that the impact of exchange rate fluctuations has been
excluded. The term "at constant exchange rate" covers the
fluctuation resulting from applying the exchange rates for the
preceding period to the current fiscal year, all other factors
remaining equal.
Revenue on a like-for-like basis: The effect
of changes in scope is corrected by restating the sales for the
previous period as follows:
-
by removing the portion of sales originating in
the entity or the rights acquired for a period identical to the
period during which they were held to the current period;
-
similarly, when an entity is transferred, the
sales for the portion in question in the previous period are
eliminated.
Life-for-like data (L-f-l): At constant scope
and exchange rates.
Internal growth: Internal growth covers growth
resulting from the development of an existing contract,
particularly due to an increase in rates and/or the volumes
distributed or processed, new contracts, acquisitions of assets
allocated to a contract or a specific project. |
|
External growth: External growth
covers acquisitions during the current fiscal year, as well as
those which have had a partial impact on the previous fiscal year,
net of sales of entities and/or assets.
EBIT: Earnings Before Interest and Taxes. EBIT
corresponds to net revenue minus operating expenses (such as
salaries, social charges, materials, energy, research, services,
external services, advertising, etc.). It is the operating income
for the Cegedim Group.
EBIT before special items: This is EBIT
restated to take account of non-current items, such as losses on
tangible and intangible assets, restructuring, etc. It corresponds
to the operating income from recurring operations for the Cegedim
Group.
EBITDA: Earnings before interest, taxes,
depreciation and amortization. EBITDA is the term used when
amortization or depreciation and revaluations are not taken into
account. "D" stands for depreciation of tangible assets (such as
buildings, machines or vehicles), while "A" stands for amortization
of intangible assets (such as patents, licenses and goodwill).
EBITDA is restated to take account of non-current items, such as
losses on tangible and intangible assets, restructuring, etc. It
corresponds to the gross operating earnings from recurring
operations for the Cegedim Group.
Adjusted EBITDA : Consolidated EBITDA
adjusted, for 2016, for the €4.0m of negative impact from
impairment of receivables in the Healthcare Professional
division
Net Financial Debt: This represents the
Company's net debt (non-current and current financial debt, bank
loans, debt restated at amortized cost and interest on loans) net
of cash and cash equivalents and excluding revaluation of debt
derivatives.
Free cash flow: Free cash flow is cash
generated, net of the cash part of the following items: (i) changes
in working capital requirements, (ii) transactions on equity
(changes in capital, dividends paid and received), (iii) capital
expenditure net of transfers, (iv) net financial interest paid and
(v) taxes paid.
EBIT margin: EBIT margin is defined as the
ratio of EBIT/revenue.
EBIT margin before special
items: EBIT margin before special items is defined as the ratio
of EBIT before special items/revenue.
Net cash: Net cash is defined as cash and cash
equivalent minus overdraft.
|
Glossary
About Cegedim:
Founded in 1969, Cegedim is an innovative technology and services
company in the field of digital data flow management for healthcare
ecosystems and B2B, and a business software publisher for
healthcare and insurance professionals. Cegedim employs more than
4,000 people in 11 countries and generated revenue of €441 million
in 2016. Cegedim SA is listed in Paris (EURONEXT: CGM).
To learn more, please visit: www.cegedim.com
And follow Cegedim on Twitter: @CegedimGroup
|
Aude Balleydier
Cegedim Media
Relations
and Communications Manager
Tel.: +33 (0)1 49 09 68 81
aude.balleydier@cegedim.com |
Jan Eryk Umiastowski
Cegedim
Chief Investment Officer
and head of Investor Relations
Tel.: +33 (0)1 49 09 33 36
janeryk.umiastowski@cegedim.com |
Anne Pezet
PRPA Agency
Media Relations
Tel.: +33 (0)1 46 99 69 69
anne.pezet@prpa.fr |
Follow Cegedim:
|
Cegedim_Results_2Q2017_ENG
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The issuer of this announcement warrants that they are solely
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information contained therein.
Source: Cegedim SA via Globenewswire
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