Quarterly Financial Information as of September
30, 2017
IFRS - Regulated Information - Not Audited
Cegedim: revenue growth remained
robust in the third quarter of 2017
-
Like-for-like revenues rose 5.9% in Q3
2017
-
Business model transformation is still going
strong
-
Cegelease divestment under consideration
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 October 26, no earlier than
5:45 pm Paris time.
The following terms "business model
transformation" and "BPO" are defined in the
Glossary.
To clarify which activities are included in the
Activities not allocated division, the
division has been renamed Corporate and
others. The make-up of Cegedim's divisions has not
changed.
IFRS 5 was not applied as at September 30, 2017.
The contributions of Cegelease and Eurofarmat to the consolidated revenue was €8.9 million
at September 30, 2017, and €8.1 million in 9M 2016. The Q3 2017
contribution was €2.4 million, compared with €2.6 million a year
earlier. |
Conference CALL on OCTOBER 26, 2017, at
6:15PM CET |
FR: +33 1 72 72 74 03 |
USA: +1 844 286 0643 |
UK: +44(0)207 1943 759 |
PIN Code: 20774857# |
The webcast is available at the following
address: www.cegedim.fr/webcast |
Boulogne-Billancourt, France,
October 26, 2017, after the market close
Cegedim, an innovative technology
and services company, posted consolidated Q3 2017 revenues of
€109.3 million, up 6.3% on a reported basis and 5.9% like for like
compared with the same period in 2016.
Over the first nine months of 2017, Cegedim posted
consolidated revenues of €339.9 million, up 6.8% on a reported
basis and 6.3% like for like compared with the same period in
2016.
Every division contributed to the
Group's positive like-for-like growth over the first nine months of
2017, as compared to the year-earlier period.
Growth at the Health insurance, HR and e-services division remained
robust, with year-on-year (y/y) increases of 10.1% in the third
quarter and 9.9% over the first nine months of 2017. Nearly all of
the division's businesses contributed to the growth.
Over the same period, the
Healthcare professionals division experienced
a slight decline, with Q3 revenues down 0.5% owing to a less
favorable comparison. Over the first nine months of the year,
division revenues rose 0.8% like for like compared with the same
period in 2016. This trend was chiefly attributable to the doctor
computerization business: the business saw growth in the US, but a
contraction in the UK pending the release of a full SaaS
version.
Part of this growth came from the
Group's BPO businesses, most of which are still ramping up their
operations.
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 considering a 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
To clarify which activities are
included in the Activities not allocated
division, the division has been renamed Corporate
and others. The make-up of Cegedim's
divisions has not changed
|
|
Third quarter |
In € million |
|
2017 |
2016 |
Chg. L-f-l |
Chg. Reported |
Health
insurance, HR and e-services |
|
68.0 |
60.6 |
+10.1% |
+12.1% |
Healthcare professionals |
|
40.4 |
41.5 |
(0.5)% |
(2.6)% |
Corporate
and others |
|
1.0 |
0.8 |
+24.3% |
+24.3% |
Cegedim |
|
109.3 |
102.8 |
+5.9% |
+6.3% |
In the third quarter of 2017,
Cegedim posted consolidated Group revenues of
€109.3 million, up 6.3% on a reported basis. Excluding an
unfavorable currency translation effect of 0.9% and a 1.3% boost
from acquisitions, revenues rose 5.9%.
The unfavorable currency
translation effect of €1.0 million, or 0.9%, was chiefly due to the
€0.7 million negative impact of the pound sterling, which
represents 10.2% of revenues, and the €0.2 million negative impact
of the US dollar, which represents 3.1% of revenues.
The €1.3 million positive impact
from acquisitions, or 1.3%, was due to the acquisition of Futuramedia in France in November 2016.
In like-for-like terms, the
Health Insurance, HR and e-services division's
revenues rose by 10.1%, whereas the Healthcare
professionals division's revenues fell by 0.5%.
|
|
First nine months |
In € million |
|
2017 |
2016 |
Chg. L-f-l |
Chg. Reported |
Health
insurance, HR and e-services |
|
208.1 |
185.2 |
+9.9% |
+12.4% |
Healthcare professionals |
|
128.8 |
130.8 |
+0.8% |
(1.6)% |
Corporate
and others |
|
2.9 |
2.3 |
+25.6% |
+25.6% |
Cegedim |
|
339.9 |
318.3 |
+6.3% |
+6.8% |
In the first nine months of 2017,
Cegedim posted consolidated Group revenues of
€339.9 million, up 6.8% on a reported basis. Excluding an
unfavorable currency translation effect of 1.1% and a 1.6% boost
from acquisitions, revenues rose 6.3%.
The unfavorable currency
translation effect of €3.6 million, or 1.1%, was chiefly due to the
€3.5 million negative impact of the pound sterling, which
represented 10.7% of revenues.
The €5.2 million positive impact
from acquisitions, or 1.6%, was due to the acquisition of Futuramedia in France in November 2016.
Both of the divisions grew their
like-for-like revenues. Health insurance, HR and
e-services division revenues rose by 9.9%, and Healthcare professionals division revenues rose by
0.8%.
Analysis of business trends by
division
The division's 9M
2017 revenues came to €208.2 million, up 12.4% on a reported basis.
The November 2016 Futuramedia acquisition in France
made a positive contribution of 2.8%. Currency translation had a
negative impact of 0.2%. Like-for-like revenues rose 9.9% over the
period.
The Health
insurance, HR and e-services division
represented 61.3% of consolidated revenues, compared with 58.2%
over the same period a year earlier.
The division's Q3
2017 revenues came to €68.8 million, up 12.1% on a reported basis.
The November 2016 Futuramedia acquisition in France
made a positive contribution of 2.1%. Currency translation had a
negative impact of 0.1%. Like-for-like revenues rose 10.1% over the
period.
The increase in the third quarter
was chiefly attributable to:
-
Continued double-digit growth at Cegedim SRH following the start of work with several
new clients of the SaaS platform for HR management;
-
Double-digit growth in point-of-sale advertising
in pharmacies and health & wellness shops for RNP, which now has a stronger digital offering since
acquiring Futuramedia in October 2016;
-
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 and process digitalization platforms. For
example, Cegedim e-business again posted
double-digit revenue growth in Q3 2017;
-
Double-digit growth in iGestion BPO activities for health insurers and mutual
insurers;
-
Brisk momentum in the business of selling
pharmaceutical sales statistics;
-
The continuation of positive trends - seen for
several quarters now - in sales of third-party payment processing
services.
The gains were marginally offset
by a decline in software and services for the personal insurance
market due to the impact of switching to the SaaS format.
The division's 9M
2017 revenues came to €128.8 million, down 1.6% on a reported
basis. Currencies had a negative impact of 2.4%. There was
virtually no impact from acquisitions or divestments. Like-for-like
revenues rose 0.8% over the period.
The Healthcare professionals division
represented 37.9% of consolidated revenues, compared with 41.1%
over the same period a year earlier.
The division's Q3 2017 revenues came to €40.4
million, down 2.6% on a reported basis. Currency translation had a
negative impact of 2.1%. There was virtually no impact from
acquisitions or divestments. Like-for-like revenues rose 0.5% over
the period.
This minor dip in third-quarter
revenues was mainly the result of the doctor computerization
business in the UK pending the release of a full SaaS version. The
first modules to hit the market early this year have received
excellent reviews. This performance was offset to some extent by
growth in other computerization businesses for:
-
French pharmacists, who have embraced the new
Smart Rx offering. The strong momentum in
second-quarter sales continued in the third quarter;
-
Doctors in the US, Belgium and France;
-
Nurses, physical therapists, speech therapists,
orthoptists, midwives and podiatrists in France;
And accelerated growth in business
related to the BCB database, an aid for
prescribing and delivering medications and other healthcare
products.
The division's 9M
2017 revenues came to €2.9 million, up 25.6% on a reported and
like-for-like basis. There was no currency impact and no
acquisitions or divestments.
The Corporate and others division
represented 0.9% of consolidated revenues, compared with 0.7% over
the same period a year earlier.
The division's Q3 2017 revenues came to €1.0
million, up 24.3% on a reported and like-for-like basis. There was
no currency impact and no acquisitions or divestments.
This positive trend reflects a
less demanding comparison and genuine development of the facilities
management and hosting activity, including for health records.
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 May 22, 2017, the Group signed
a factoring agreement with a French bank. The non-recourse
agreement covers aggregated total receivables of €38.0 million. The
operating units involved in the arrangement are Cegedim SA, Cegedim Activ,
Cegedim SRH and CETIP.
The factoring agreement is open-ended, but either party may
terminate it at any time, subject to a three-month notice
period.
It applies to trade receivables
denominated in euros payable by clients located in France. The
amount of trade receivables sold under the agreement came to €18.8
million at June 30, 2017.
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.
As part of the BPO contract
Cegedim signed with the Klesia group in
September 2016, the two companies created an economic interest
group (GIE), held 50/50. In January 2017, Cegedim lent Isiaklé €9 million for a period of 10
years at an interest rate of 1m Euribor plus a margin of 1.1%.
Isiaklé will use the loan to purchase from Klesia a €9 million
software package necessary for it to perform its services. The GIE
is accounted for in Cegedim's consolidated
accounts using the equity method.
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. Payment was made on July 21,
2017.
Cegedim has
decided to appeal this decision. The appeal is currently under
way.
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 March 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.
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. After
consulting with its external legal counsel, the Group has decided
not to record any provisions.
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.
Significant post-closing
transactions and events
To the best of the company's knowledge, apart from
the item cited below, there were no events or changes after the
accounts were closed that would materially alter the Group's
financial situation.
On October 20, 2017, the court of
Nimes ordered Alliadis to pay a fine of €2
million as part of a case involving a pharmacist from Remoulins,
France. Cegedim has asked for the case to be
dismissed. A ruling is scheduled for November 24. The €2 million
fine is the maximum currently allowed under the law (Article 1741
of the General Tax Code in force on January 1, 2017). But the
accusations against Alliadis date back to 2007
and 2008. The version of Article 1741 in force from January 1,
2006, to May 14, 2009, sets a maximum fine of €375,000.
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 pick up in Q4 2017 and lead to improving
profitability in the future.
For 2017, Cegedim still expects:
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.
|
December 11, 2017 - 2:30 to 5:45 pm CET |
8th Investor
Summit: « Cegedim DNA : A unique
presence in the connected healthcare ecosystem » |
Financial calendar
October 26, 2017, at
6:15pm (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:
www.cegedim.fr/webcast
The third 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 72 74 03
United States :
+1 844 286 0643
UK and others : +44
(0)207 1943 759 |
PIN Code: 20774857# |
Additional information
Q3 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 |
67,955 |
- |
208,211 |
|
Healthcare professionals |
|
44,045 |
44,334 |
40,383 |
- |
128,762 |
|
Corporate
and others |
|
1,054 |
930 |
957 |
- |
2,940 |
|
Cegedim |
|
113,705 |
116,913 |
109,294 |
- |
339,912 |
|
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 |
|
Corporate
and others |
|
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 |
|
97.0% |
3.0% |
- |
- |
Healthcare professionals |
|
60.9% |
30.1% |
9.0% |
- |
Corporate
and others |
|
99.7% |
0.3% |
- |
- |
Cegedim |
|
83.3% |
13.3% |
3.4% |
- |
Breakdown of revenue by currency
and division
In € thousands |
|
Euro |
GBP |
USD |
Others |
Health insurance, HR and e-services |
|
97.0% |
1.9% |
- |
1.1% |
Healthcare professionals |
|
65.0% |
25.0% |
8.8% |
1.2% |
Corporate
and others |
|
100.0% |
- |
- |
0.0% |
Cegedim |
|
84.9% |
10.7% |
3.3% |
1.1% |
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
Corporate and others: 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.
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, LinkedIn and
Facebook.
|
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 |
Marina Rosoff
For Madis Phileo
Media Relations
Tel: +33 (0)6 71 58 00 34
marina@madisphileo.com |
Follow Cegedim:
|
Cegedim_Revenue_3Q2017
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
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The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Cegedim SA via Globenewswire
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