Cegedim: 2012: An Improvement Relative to 2011
Cegedim: 2012: An Improvement Relative to 2011
Growth in the Second Half
CRM and Strategic Data Margin Maintained
Robust Growth in the Healthcare Professionals and Insurance and Services Sectors Continued R&D Efforts
PARIS--(BUSINESS WIRE)-- Regulatory News:
Cegedim, a global technology and services company specializing in the healthcare field, posted consolidated 2012 revenues of €921.8 million, up 1.1% on a reported basis, and operating income from continuing operations of €90.1 million, up 7.4%. Operating margin was 9.8%, up from 9.2% a year earlier.
The second half was more favorable, with reported revenues up 3.4% and a 23.6% increase in operating income from continuing operations compared with the second half of 2011.
As a result, the CRM and strategic data margin was stable over the full year despite a drop in revenues, whereas the Healthcare professionals margin rose and the Insurance and services margin dipped slightly.
Continued sales momentum, ongoing R&D efforts, innovative new product launches and the effects of the Performance Improvement Plan will all boost Group revenues and operating income from continuing operations in 2013.
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2012 | 2011 | Δ | |||
€m | % | €m | % | ||
Revenue | 921.8 | 100% | 911.5 | 100% | +1.1 |
EBITDA from continuing operations | 153.6 | 16.7% | 150.4 | 16.5% | +2.2 |
Depreciation | -63.5 | -66.5 | -4.5 | ||
Operating income from continuing operations | 90.1 | 9.8% | 83.9 | 9.2% | +7.4 |
Exceptional operating income / expenses | -9.9 | -8.0 | +23.8 | ||
Impairment of goodwill on acquisition | -124.9 | ||||
Operating income | -34.8 | -3.8% | 75.9 | 8.3% | |
Net cost of financial debt | -44.1 | -37.7 | +17 | ||
Tax expenses | -7.6 | -6.6 | +15.1 | ||
Share of earnings in equity-accounted affiliates | 1.2 | 1.0 | |||
Consolidated profit | -85.3 | -9.3% | 32.7 | 3.6% | |
Profit attributable to the owners of the parent | -85.4 | -9.3% | 32.6 | 3.6% | |
* at constant scope and exchange rates | |||||
Cegedim generated 2012 revenues of €921.8 million, up 1.1% on a reported basis and down 1.0% in organic terms relative to 2011. The net effect of acquisitions and divestments was neutral, and currencies provided a 2.1% boost.
Operating income from continuing operations was €90.1 million, up 7.4% year on year. This increase was chiefly the result of stronger operating income from continuing operations in the Healthcare professionals and Insurance and services sectors, offset by a marginal decline in the CRM and strategic data sector.
Weak activity in the CRM and strategic data sector in the first half 2012 led the Group to record a goodwill impairment of €115 million at end-June 2012. As a result, operating income for the full year was a loss of €34.8 million.
Interest expense rose from €37.7 million to €44.1 million, or 17.1%, principally due to non-cash items.
The consolidated loss attributable to the owners of the parent came to €85.4 million, and earnings per share were €2.7 compared with €2.8 a year earlier.
Analysis of business trends by sector
CRM and strategic data
Sector revenue for 2012 was €488.1 million, down 4.4% on a reported basis. Perimeter effect had a negative impact on revenue growth of 0.8% thus currencies had a positive impact on revenues of 2.7%. As a result, 2012 like-for-like* revenue was down by 6.4% relative to December 2011.
This decrease was primarily due to a decrease in the number of medical sales representatives and a reduction in other marketing expenditures by some pharmaceutical companies in mature countries. On the other hand, the increase in the number of medical sales representatives in certain emerging countries and of revenue from our OneKey database and compliance offer partially offset this decrease.
While the revenue in this sector decrease by €22.5 millions of euros, the operating income from recurring operations decrease only by 0.9 millions of euros partly thanks to the implementation of our Performance Improvement Plan.
It should be emphasized the improved EBIT margin in the second half, which stood at 12.4% against 11.8% in the second half of 2011. For the year 2012 the EBIT margin was 6.7% against 6.6% in 2011.
Healthcare professionals
2012 revenues came to €282.6 million, up 8.8% on a reported basis compared with end-2012. Currency effects and acquisitions boosted revenues by respectively 1.7% and 1.9%. On a like-for Like basis revenue increased by 5.2%. This increase was mainly due to better performance on the three main areas of this sector and among other things to the continued computerization of healthcare professionals in the United Kingdom and France.
Operating income from continuing operations came to €35.2 million, a 20.0% increase over the year-earlier period. As a result, the margin from continuing operations was 12.4%, compared with 11.3% a year earlier.
Insurance and services
2012 revenues came to €151.0 million, up 7.1% on a reported and on a Like-for-Like basis compared with end-2012. There were no disposals or acquisitions and there was minimal impact from foreign currency translations.
Operating income from continuing operations came to €22.3 million, a 6.1% increase over the year-earlier period. As a result, the margin from continuing operations was 14.7%, compared with 14.9% a year earlier.
This increase was primarily due to the growth in online third-party payer management services, e-business activities and Cegedim SRH, a system which provides outsourcing of payroll and human resources management.
Financial resources
Cegedim's total consolidated balance sheet at December 31, 2012, was €1.288 billion, down slightly from the end of 2011. The dip is chiefly attributable to a €115 million depreciation of goodwill in CRM and strategic data activities during the first half of 2012.
Share capital decreased by €91.0 million and now represents 33% of total assets.
Following an impairment, goodwill amounts to €613.7 million, compared with €725.1 million at end-2011, representing 47.6% of total assets.
Cash and equivalents come to €43.5 million.
Net financial debt comes to €475.6 million, compared with €453.3 million at end-2011. This €22.3 million increase is the result of earn-out payments made en 2012.
The Group was in compliance with all of its bank covenants at end-2012.
Before the cost of net financial debt and taxes, cash flow was €141 million, compared with €140.1 million at end-2011. The level of gearing improved from 0.9 at end-2011 to 1.1 at end 2012.
2012 highlights
Divestment
Cegedim sold its Pharmapost subsidiary on April 30, 2012, one of France's leading printers of drug information sheets, to the Chesapeake group. Pharmapost contributed €5.9 million to Group consolidated revenues in 2011; its contribution to consolidated EBITDA was close to zero. Under the terms of the agreement between the two parties, all other details regarding the transaction are confidential.Acquisition
On July 3, 2012, Cegedim completed the acquisition of ASP Line, France's fourth-largest publisher of pharmacist software, Cegedim's leadership position in the pharmacy computerization market in France (see release sent on July 3, 2012). Financed by internal financing, these activities represent annual revenues of around €9 million and are part of the consolidation scope of Cegedim Group from July 1, 2012.
Award
On September 26, Cegedim received the "Mid Cap Corporate Governance" award, sponsored by L'AGEFI, in recognition of the quality of the transparency and governance practices that the Group has adopted.
Readjustment of bank covenants
On October 3, Cegedim obtained the consent of its banking partners under the credit facility to amend certain covenants thereunder. This consent signals the continued confidence of our banking partners in the Group.
Significant post-closing transactions and events
To the best of the company's knowledge, there have been no post-closing events or changes that would materially alter the Group's financial situation.
Outlook
For 2013, barring any significant changes in market trends, the Group expects modest growth in consolidated revenues and a 50bps increase in the operating margin on continuing operations.
Financial calendar
The Group will hold a conference call today March 4th, 2013, at 6:15 pm in English (Paris time). The call will be hosted by Jan Eryk Umiastowski, Cegedim Chief Investment Officer and Head of Investor Relations.Cegedim's annual results presentation is available at:
http://www.cegedim.com/finance/documentation/Pages/presentations.aspx
Contact numbers: | France: +33(0)1 70 48 01 66 | Access code: | ||||||
USA: +1 646 254 3365 | 8149257 | |||||||
UK and other: +44 (0)20 7784 1036 | ||||||||
March 5, 2013 - 11:30 am
SFAF meeting
May 6, 2013 (after the stock market closes)
2013 Q1 Revenue announcement
July 30, 2013 (after the stock market closes)
2013 Q2 Revenue announcement
September 19, 2013 (after the stock market closes)
2013 H1 Results announcement
September 20, 2013
SFAF Meeting
November 7, 2013 (after the stock market closes)
2013 Q3 Revenues announcement
Additional information
The Audit Committee met on March 1st, 2013. The Board of Directors and the Auditors met on March 4, 2013, to approve 2012 consolidated financial statements. Audit procedures have been performed and the 2012 Full-year statutory auditors' report on the financial statements is forthcoming.
The financial information presented in this press release comes from Cegedim Full-year consolidated financial statements and is fully available on the 2012 Reference Document at www.cegedim.com/finance as of March 5, 2013.
A presentation of Cegedim 2012 Full-year results will also be available on the website:
In English :
http://www.cegedim.com/finance/documentation/Pages/presentations.aspxIn French :
http://www.cegedim.fr/finance/documentation/Pages/presentations.aspx
Appendices
Balance sheet
Assets | ||||||||
In thousand of euros | 12/31/2012 | 12/31/2011 | ||||||
Goodwill on acquisition | 613,727 | 725,058 | ||||||
Development costs | 26,408 | 24,446 | ||||||
Trademarks, patents | - | - | ||||||
Other intangible fixed assets | 183,714 | 167,002 | ||||||
Intangible fixed assets | 210,122 | 191,448 | ||||||
Property | 389 | 409 | ||||||
Buildings | 5,766 | 5,147 | ||||||
Other tangible fixed assets | 33,343 | 35,958 | ||||||
Construction work in progress | 2,192 | 2,594 | ||||||
Tangible fixed assets | 41,690 | 44,108 | ||||||
Equity investments | 544 | 443 | ||||||
Loans | 1,917 | 1,400 | ||||||
Other long-term investments | 11,445 | 9,637 | ||||||
Long-term investments - excluding equity shares in equity method companies | 13,906 | 11,480 | ||||||
Equity shares in equity method companies | 8,145 | 7,645 | ||||||
Government - Deferred tax | 57,855 | 48,093 | ||||||
Accounts receivable : Long-term portion | 15,909 | 14,498 | ||||||
Other receivables : Long-term portion | 726 | 651 | ||||||
Non-current assets | 962,078 | 1,042,982 | ||||||
Services in progress | 188 | 305 | ||||||
Goods | 10,798 | 10,274 | ||||||
Advances and deposits received on orders | 971 | 1,151 | ||||||
Accounts receivable : Short-term portion | 215,223 | 222,350 | ||||||
Unpaid, called-up capital | - | - | ||||||
Other receivables : Short-term portion | 38,696 | 25,778 | ||||||
Cash equivalents | 3,862 | 14,041 | ||||||
Cash | 39,599 | 59,087 | ||||||
Prepaid expenses | 16,881 | 17,347 | ||||||
Current assets | 326,219 | 350,334 | ||||||
Total assets | 1,288,297 | 1,393,316 | ||||||
Equity and Liabilities | ||||||||
In thousand of euros | 12/31/2012 | 12/31/2011 | ||||||
Share capital | 13,337 | 13,337 | ||||||
Issue premium | 185,561 | 185,562 | ||||||
Group reserves | 297,712 | 263,439 | ||||||
Group exchange reserves | -238 | -238 | ||||||
Group exchange gains/losses | 13,736 | 21,058 | ||||||
Group earnings | -85,351 | 32,580 | ||||||
Investment subsidies | - | - | ||||||
Regulated provisions | - | - | ||||||
Shareholders' equity, Group share | 424,757 | 515,737 | ||||||
Minority interests (reserves) | 418 | 407 | ||||||
Minority interests (earnings) | 89 | 90 | ||||||
Minority interests | 507 | 497 | ||||||
Shareholders' equity | 425,263 | 516,234 | ||||||
Long-term financial liabilities | 457,103 | 483,744 | ||||||
Long-term financial instruments | 13,207 | 14,094 | ||||||
Deferred tax liabilities | 13,617 | 12,862 | ||||||
Non-current provisions | 29,615 | 25,154 | ||||||
Other non-current liabilities | 3,562 | 7,142 | ||||||
Non-current liabilities | 517,104 | 542,996 | ||||||
Short-term financial liabilities | 72,609 | 51,871 | ||||||
Short-term financial instruments | 13 | 27 | ||||||
Accounts payable and related accounts | 91,092 | 92,079 | ||||||
Tax and social liabilities | 123,872 | 119,517 | ||||||
Provisions | 4,533 | 5,075 | ||||||
Other current liabilities | 53,810 | 65,516 | ||||||
Current liabilities | 345,930 | 334,085 | ||||||
Total Liabilities | 1,288,297 | 1,393,316 | ||||||
Income statement
In thousand of euros | 12/31/2012 | 12/31/2011 | ||||||
Revenue | 921,773 | 911,463 | ||||||
Other operating activities revenue | - | - | ||||||
Capitalized production | 48,419 | 47,137 | ||||||
Purchases used | -111,513 | -105,648 | ||||||
External expenses | -234,734 | -240,184 | ||||||
Taxes | -14,658 | -15,101 | ||||||
Payroll costs | -449,821 | -442,231 | ||||||
Allocations to and reversals of provisions | -5,424 | -3,886 | ||||||
Change in inventories of products in progress and finished products | -125 | 101 | ||||||
Other operating income and expenses | -276 | -1,224 | ||||||
EBITDA | 153,642 | 150,428 | ||||||
Depreciation expenses | -63,522 | -66,523 | ||||||
Operating income from continuing operations | 90,120 | 83,905 | ||||||
Impairment of goodwill | -115,000 | - | ||||||
Exceptional operating income and expenses | -9,886 | -7,983 | ||||||
Other exceptional operating income and expenses | -124,886 | -7,983 | ||||||
Operating income | -34,766 | 75,922 | ||||||
Income from cash and cash equivalents | 727 | 5,487 | ||||||
Gross cost of financial debt | -33,750 | -36,433 | ||||||
Other financial income and expenses | -11,096 | |||||||
