EMIS lays foundations for future growth

Last week EMIS revealed its maiden annual results since its listing on AIM last March. They might only have revealed flat-ish organic revenue growth (see EMIS appoints non-exec Chair, exits Canada), but the GP software provider looks well positioned to grow in 2011 and beyond.

Combined, EMIS and RX Systems, the pharmacy software provider in which it acquired a majority stake last year, are a sizable force in the UK healthcare SITS market with total revenues of £61.9m in FY10. That should be enough to secure its place in our Top 10 UK healthcare SITS rankings again in 2011.

EMIS’ core recurring revenue from licensing and software support (excluding the discontinued Canadian business) increased by 8.9% to £31.7m, mainly as a result of more GP practices moving to accredited hosted systems. However, not unsurprisingly, discretionary spending on hardware, engineering services and training was affected by pressure on NHS budgets, and income from this part of the business fell by 12.5% to £21.7m. The net effect is a slight decline in EMIS’ organic revenue (from £57.7m to £56.9m) but improved margins (operating margins at the core business are now 34%, up from 29% the year before).

2010 was a busy year for EMIS, during which it laid the foundations for future growth. For starters, having achieved NHS accreditation for its next generation software EMIS Web in September last year, EMIS began the controlled rollout of its new web-based application. With over 2,000 GP practices having already ordered the software or signed up to the ‘familiarisation service’, CEO Sean Riddell expects deployments to crank up later in 2011. EMIS also won new business in Scotland and Australia, launched the Healthcare Gateway joint venture with rival INPS, and moved into the adjacent pharmacy market with the acquisition of RX Systems.

But with all the uncertainty in the UK healthcare SITS market at the moment pending the creation of GP consortia, what does the future hold for the GP systems supplier? We recently caught up with EMIS CEO Sean Riddell to learn more about his plans for the company in cross-organisational healthcare. Subscribers to TechMarketView’s Foundation Service can read more in our latest CompanyViews research note – EMIS: Laying foundations in cross-organisational healthcare – which is available for download from today.

Posted by Tola Sargeant at '16:26' - Tagged: results   health