EMIS reports strong adjusted growth, extends acquisition timeline

Healthcare software and technology specialist EMIS Group reported total revenue of £175.4m in its preliminary results on Thursday - a 4% increase year-on-year.

The AIM-traded firm said recurring revenue in the 12 months ended 31 December was ahead 6%, meanwhile, at £143.3m.

Its adjusted operating profit climbed 10% to £47.7m, although its reported operating profit slid 22% to £27.7m.

EMIS Group improved its adjusted operating margin by 130 basis points to 27.2%, while its reported operating margin was 550 basis points narrower, at 15.8%.

Cash generation remained positive, with adjusted cash generated from operations rising by 10% to £54.6m.

Reported cash generated from operations decreased slightly by 2% to £48.8m, and the net cash position of the company at year-end was by 28% lower at £45.9m.

Adjusted earnings per share jumped 10% to 62p, while reported earnings per share declined 14% to 52.5p.

EMIS Group announced an increase in dividends for the 12th consecutive year, proposing a final dividend 20% higher than the prior year at 21.1p.

That would take its total dividends for the year up 10% to 38.7p.

Looking ahead, EMIS said it was confident in delivering on full-year expectations for 2023.

The firm said it was well-positioned to support the NHS in its goal of improved preventative care.

EMIS also updated shareholders on its recommended acquisition by a wholly-owned subsidiary of UnitedHealth Group, as first announced on 17 June last year.

On 31 March, the Competition and Markets Authority (CMA) rejected a proposed remedy from UnitedHealth’s ‘Bidco’, resulting in a second phase investigation.

Bidco and EMIS had agreed to extend the long stop date for completion from 30 June this year, to 30 June 2024.

The firm said the scheme remained subject to court sanction, as well as the satisfaction of the remaining CMA requirements.

EMIS Group now expected the scheme to become effective in either the fourth quarter of 2023, or the first quarter of 2024.

“It has been another year of good progress for EMIS Group,” said chief executive officer Andy Thorburn.

“The business performed well, achieving positive results in a changing market and against the backdrop of agreeing and recommending an offer for the group, which remains subject to completion.

“EMIS remains well placed to deliver the systems that will enable the NHS to realise its ambition of better, faster and proactive preventative care for the UK population.”

Thorburn said the company’s technology roadmap remained “closely aligned” with NHS England’s strategy, adding that its position on NHS Digital's new Tech Innovation Framework (TIF) demonstrated its ability to deliver the NHS's integrated digital future.

“We are confident of our strategy, technology roadmap and ability to deliver consistent good performance over the medium term.”

At 1446 BST, shares in EMIS Group were down 0.15% at 1,326p.

Reporting by Josh White for Sharecast.com.