- Consolidated group revenues 2019 at EUR 746 million at upper end of guidance
- Group operating results (EBITDA) of EUR 178 million within guidance
- Recurring revenue + 11 % compared to previous year, makes up 62 % of total revenue
- Guidance for 2020 revenue: EUR 765 million to EUR 815 million
- Guidance for adjusted EBITDA 2020: EUR 195 million to 215 million
- Purchase agreement to acquire Cerner's businesses medico in Germany and Selene in Spain signed
- Planned conversion into KGaA ensures stable further development
CompuGroup Medical SE (CGM), one of the world's leading providers of eHealth solutions, today presented its financial report for the fourth quarter and the full financial year 2019 based on preliminary, unaudited figures. The Koblenz-based company closed the fourth quarter with revenues of EUR 206 million and operating results before interest, taxes, depreciation, and amortization (EBITDA) of EUR 52 million. For the fiscal year as a whole, this means revenues of EUR 746 million and operating results (EBITDA) of EUR 178 million. As a result, revenues and profits are in line with the target figures communicated for 2019, with revenues at the upper end of the guidance.
"The achievement of the guidance as well as the double-digit growth in recurring revenues for the full year reaffirms our strategic direction and underlines the sustainable revenue and profit power of CompuGroup Medical," says Chief Financial Officer (CFO) Michael Rauch and adds: "And this on the basis of a very strong previous year and despite extraordinary special effects in 2019."
Guidance for 2020 includes significant increase
For the year 2020, CGM expects another significant increase. Revenues in the range of EUR 765 million to EUR 815 million are expected for the 2020 financial year. CompuGroup Medical announces to publish an EBITDA adjusted for special effects from 2020 in order to increase transparency. Adjusted EBITDA is expected to be between EUR 195 million and EUR 215 million in 2020.
Not included in the guidance for 2020 are the prorated revenue and earning contributions from the acquisition of a part of Cerner's portfolio, medico business in Germany and Selene business in Spain. The purchase agreement here was signed this morning, closing is expected for the third quarter of 2020 and is subject to certain regulatory approvals. The parts of the company being transferred, according to preliminary figures, have generated revenues of ca. EUR 74 million and operating results (EBITDA) of ca. EUR 13 million in the 2019 financial year. Purchase price is EUR 225 million and is subject to final adjustment upon closing.
Encouraging development in all segments
In its core business, CGM made significant progress in all four segments in 2019. On the basis of preliminary figures, the largest segment, Ambulatory Information Systems (AIS), generated revenues of Euro 461 million for the 2019 financial year as a whole. Recurring revenues in this segment rose by 14 % to EUR 317 million for the year as a whole.
The increase in recurring revenues is not least thanks to good growth in the telematics infrastructure (TI) services. In November, CompuGroup Medical was the first provider to receive the approval from gematik for the use of an eHealth connector in the telematics infrastructure. Following a successful completion of field tests, this will enable medical applications such as emergency data management, the electronic medication plan, and secure electronic communication between service providers in the future. With an installed basis of around 54,000 TI connection packages in medical and dental practices and hospitals CGM is the clear market leader in the field of telematics infrastructure.
Hospital business picks up significantly, TI rollout in pharmacy business expected for 2020
The Hospital Information Systems (HIS) segment recorded a strong revenue growth of 15 % for the year as a whole, accompanied by a 26 % year-on-year increase in EBITDA. The major order from Lower Austrian Regional Hospital Holding (Niederösterreichische Landeskliniken-Holding, NÖLKH), worth more than EUR 100 million, contributed to this strong year.
"Our success in the hospital segment shows that the hospital information system CGM CLINICAL excellently meets the new challenges that hospitals are changing internationally and that our investments were right in time," comments Frank Gotthardt, Chairman and CEO of CompuGroup Medical SE.
The Pharmacy Information Systems (PCS) segment grew by 6 % in 2019 compared with the previous year. EBITDA increased by 7 % year-on-year. In the PCS segment, the approval of the eHealth connector is expected to be the starting point for the TI rollout and thus is expected to generate good recurring revenues in the long term.
Connectivity segment particularly benefits from digitization
The Health Connectivity Services (HCS) segment likewise achieved a year-on-year growth of 17 % in 2019. At + 25 %, EBITDA also rose considerably compared with the previous year. A reorganization of the segment structure took place end of the year. The Health Connectivity Services (HCS) segment was replaced by the new Consumer and Health Management Information Systems (CHS) segment as of December 31, 2019 as part of this reorganization. In addition some business units within the segment have been reorganized.
CEO Frank Gotthardt looks enthusiastically ahead to the growth opportunities in this segment and summarizes: "It is particularly encouraging that smart digital connectivity between health professionals and the involvement of citizens is increasingly becoming a reality. Our strategic step establishing the Management Board segment CHS will enable us to get more focused and even stronger playing a leading role in enabling many people to benefit from the ongoing transformation of healthcare systems."
Transformation into KGaA as growth engine for the future
Management Board and Supervisory Board of CompuGroup Medical SE have also resolved today to propose to the Company's shareholders at the Annual General Meeting scheduled for May 13, 2020 that the Company change its legal form from a European Company (SE) to a partnership limited by shares (Kommanditgesellschaft auf Aktien, KGaA). The change of legal form does not change the share that investors own in CompuGroup Medical. They will hold the same number of no-par-value bearer shares in the KGaA as they do in CompuGroup Medical SE prior to the change of legal form. The aggregate number of no-par-value shares issued remains unchanged.
"The conversion into a KGaA gives us the greatest possible flexibility to realize our growth ambitions and ensuring stable further development while maintaining the entrepreneurial approach and founding spirit of the Gotthardt family," says CFO Michael Rauch with conviction.
The complete quarterly report is available on the company's website www.cgm.com under Investor Relations .