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Commercialising recent investment

EMIS Group 14 September 2021 Update
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EMIS Group

Commercialising recent investment

H121 results

Software & comp services

14 September 2021

Price

1,368p

Market cap

£866m

Net cash (£m) at end H121

48.0

Shares in issue

63.3m

Free float

98%

Code

EMIS

Primary exchange

AIM

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

1.0

15.0

20.7

Rel (local)

2.8

14.8

(0.3)

52-week high/low

1,420p

960p

Business description

EMIS is a software supplier to the UK healthcare market, with two divisions. EMIS Health supplies integrated care technology to the NHS, including primary, community, acute and social care. EMIS Enterprise is a business-to-business software provider to the healthcare market, including medicines management, partner businesses, patient-facing services and healthcare analytics.

Next events

FY21 trading update

January 2022

Analyst

Katherine Thompson

+44 (0)20 3077 5730

EMIS Group is a research client of Edison Investment Research Limited

EMIS reported H121 results ahead of board expectations and is on track to meet the company’s FY21 expectations. After a period of investment to develop the EMIS-X platform, and at least a year of diverting resource to support customers’ COVID-19 efforts, EMIS is now in a position to execute its growth strategy. Our revenue and adjusted operating profit forecasts are unchanged, with revenue growth accelerating to the lower end of the targeted medium-term 5–9% range from FY22.

Year end

Revenue (£m)

PBT*
(£m)

Diluted EPS*
(p)

EMIS adj dil EPS** (p)

DPS
(p)

P/E
(x)

12/19

159.5

41.0

53.5

51.1

31.2

25.6

12/20

159.5

43.4

56.4

50.4

32.0

24.3

12/21e

164.1

42.2

53.7

52.8

35.2

25.5

12/22e

172.7

46.7

59.5

57.1

36.0

23.0

Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments. **EMIS adjusted EPS – cash accounts for development costs and excludes exceptional items and amortisation of acquired intangibles.

H121: Solid performance

While continuing to support customers with COVID-19 related requirements, EMIS saw operations start to return to normal. H121 revenue increased 7% y-o-y and adjusted operating profit grew 13% y-o-y. EMIS Health revenue was marginally higher, with higher-margin revenue driving adjusted operating profit up 5% y-o-y. EMIS Enterprise revenue increased 21% y-o-y and adjusted operating profit was up 28% y-o-y. The group closed H121 with net cash of £48m and announced an interim dividend of 17.6p, up 10% y-o-y and ahead of our 17p forecast. Our revenue and adjusted operating profit forecasts are unchanged although we have revised our capex, depreciation and amortisation forecasts to reflect company guidance.

Well-positioned for post-COVID-19 healthcare market

The pandemic has accelerated digital adoption within healthcare and even once the worst of the pandemic is over, and the vaccination programme substantially complete, we believe this is a permanent structural shift. The importance of data to assess performance and improve preventative medicine has become more evident and at the same time, there is increased focus on combining health and social care. EMIS’s expertise in connected care puts it at the heart of this, with critical mass in primary, acute, pharmacy and community care, and EMIS-X analytics tools that are designed to work safely and securely with clinical data.

Valuation: At a discount to peers

Compared to a global group of healthcare software peers, EMIS trades at a discount on all valuation metrics. EMIS generates significantly higher operating profit margins but with slightly slower revenue growth, generates lower earnings growth. Its dividend yield is significantly ahead of the group. Key to closing the discount will be evidence that revenue growth is returning to the company’s medium-term goal of mid- to high-single digits, in turn driving stronger earnings growth. We note that EMIS has good visibility (recurring revenue was 79% in H121) and a strong balance sheet with no debt.

Review of H121 results

Exhibit 1: H121 results highlights

£m

H121

H120

y-o-y

Revenues

83.5

78.1

6.9%

Gross margin

90.3%

85.3%

5.0%

EBITDA

25.7

25.2

2.1%

EBITDA margin

30.8%

32.2%

(1.5%)

Normalised EBIT

20.4

20.4

0.1%

EMIS adjusted EBIT

20.0

17.8

12.6%

Reported EBIT

16.3

16.6

(1.9%)

Normalised EBIT margin

24.4%

26.1%

(1.7%)

EMIS adjusted EBIT margin

24.0%

22.8%

1.2%

Reported EBIT margin

19.5%

21.3%

(1.8%)

Net interest income

(0.2)

(0.1)

90.1%

Reported PBT

16.4

17.7

(7.2%)

Tax

(3.3)

(3.4)

(1.4%)

Normalised net income

16.5

17.1

(3.6%)

Reported net income

13.1

14.4

(9.0%)

Normalised diluted EPS (p)

26.0

27.1

(4.1%)

EMIS adjusted diluted EPS (p)

25.3

22.9

10.5%

Reported basic EPS (p)

20.8

22.9

(9.2%)

Net cash

48.0

44.1

8.9%

Source: EMIS, Edison Investment Research

Exhibit 2: Divisional performance

£m

H120

H220

H121

y-o-y

h-o-h

Revenues

EMIS Health

54.0

53.8

54.3

0.5%

0.9%

EMIS Enterprise

24.1

27.6

29.3

21.3%

6.1%

Total

78.1

81.3

83.5

6.9%

2.7%

Adjusted operating profit

EMIS Health

11.9

13.2

12.5

4.7%

(5.1%)

EMIS Enterprise

6.5

9.2

8.4

28.3%

(8.7%)

Central costs

-0.7

-0.8

-0.8

23.9%

1.0%

Total adjusted operating profit

17.8

21.5

20.0

12.6%

(6.9%)

Reported operating profit

EMIS Health

13.1

10.7

10.6

(19.3%)

(1.3%)

EMIS Enterprise

4.2

9.3

6.6

56.3%

(29.0%)

Central costs

-0.7

-0.8

-0.8

23.9%

1.0%

Total reported operating profit

16.6

19.1

16.3

(1.9%)

(14.8%)

Adjusted operating margin

EMIS Health

22.1%

24.5%

23.0%

0.9%

(1.5%)

EMIS Enterprise

27.0%

33.3%

28.6%

1.6%

(4.7%)

Total adjusted operating margin

22.8%

26.4%

24.0%

1.2%

(2.5%)

Reported operating margin

EMIS Health

24.3%

19.9%

19.5%

(4.8%)

(0.4%)

EMIS Enterprise

17.4%

33.6%

22.5%

5.0%

(11.1%)

Total reported operating margin

21.3%

23.5%

19.5%

(1.8%)

(4.0%)

Source: EMIS

While the company continues to support customers with their COVID-19 requirements, operational activities have broadly returned to business as usual. EMIS reported revenue growth of 7% y-o-y in H121, with recurring revenue growth of 4% y-o-y (79% of revenue). Adjusted operating profit increased 13% y-o-y and the adjusted operating margin increased 1.2pp to 24.0%. This was after the award to all staff of a one-off cash bonus to reward them for work during the pandemic. Adjusted EPS increased 11% y-o-y. Both revenue and adjusted operating profit were also ahead of H119 (ie pre COVID-19).

On a normalised basis, operating profit was flat and net income was 4% lower year-on-year, reflecting a much lower level of capitalised development costs (H121 £2.1m vs H120 £4.1m). Management noted that the R&D team had been more focused on customer experience during H1 and the criteria for capitalising costs had been tightened.

The company closed H121 with gross/net cash of £48.0m. Cash from operations of £17.0m was after making the deferred VAT payment of £7.3m and also reflected some overdue accounts receivable, which were received in July.

EMIS announced an interim dividend of 17.6p (+10% y-o-y), ahead of our 17p estimate.

EMIS Health: Steady performance

The division saw revenue growth of 0.5% y-o-y, while a lower proportion of lower-margin hardware sales compared to last year resulted in adjusted operating profit growth of 4.7%.

The company noted that there had been no material changes to market shares. The business continues to deliver on the requirements of the GP IT Futures contract within primary care and support ongoing requirements relating to COVID-19. EMIS’s online test results system, Keystone, was scaled up to manage the sending of up to 10 million test results per day into GP records. EMIS also released new technology to support GPs through the vaccination programme and helped NHS England with its daily COVID-19 reporting requirements.

EMIS Health continues to support its Welsh customers; no end users have moved away from EMIS since the framework was changed in 2018. EMIS is awaiting the outcome of the new Digital Health and Care Wales primary care framework tender process.

The business began to use EMIS-X analytics internally to analyse reporting trends and spot potential problems at an earlier stage.

EMIS Enterprise: Shifting from investment to growth

Boosted by the use of Pinnacle’s Outcomes4Health software to support the COVID-19 vaccine rollout in England, the division saw revenue growth of 21% y-o-y and adjusted operating profit growth of 28% y-o-y (margin 28.6%).

The company noted that Pinnacle contributed £3.3m to revenue in H121, compared to £0.7m in H120, with the majority of revenue in H121 coming from projects to set up and scale up the system for the vaccination programme. 66m vaccinations have been recorded in the software to date. These are transferred through interoperability to the National Immunisation Management System and from there to GP clinical systems the next day. This enables patients to access the data via the NHS App or Patient Access. EMIS expects that Outcomes4Health software will be used for COVID-19 booster vaccinations and flu vaccinations. Integration of Pinnacle software with GP and community pharmacy software is ongoing.

The division’s focus is on growth in the following areas:

Patient-facing digital services: Patient Access had 13 million registered users at the end of H121, up from 11.7 million at the end of FY20. 11.5 million repeat prescriptions were ordered in H121 compared to 11.7 million in H120. The pilot version of a new service, Smart Pharmacy, was launched, which allows patients to order, track and opt for home delivery of their medications from their local pharmacy.

Developing the life sciences market with EMIS-X Analytics (EXA): since its launch in October 2020, EXA has been used in several pilot projects. During H121, two pilots were converted to commercial contracts.

Pharmacy: community pharmacy appointment bookings are growing, with the booking service now live in 1,600 branches of 248 pharmacies. A new solution was launched to support the national Discharge Medicines Service in England, supporting the transfer of clinical information when a patient is discharged from hospital to their chosen community pharmacy.

Partner programmes: this has evolved into two types of partner. Elite partners offer strategically important core capabilities (eg document management, video consulting, referral functionality), which plug-in to EMIS technology to provide a complete solution. Resale partners offer a wide range of products and services that interoperate and exchange data with EMIS clinical systems, including clinical devices such as spirometry and ECG devices. EMIS noted that more than 20% of revenue in H121 was generated from partner programmes across both divisions.

The company also noted the many current and potential uses for EMIS-X. Examples include care pathways (identify patients who may require additional clinical care and assess outcomes of this care), analysing vaccine adverse events and early identification of undetected conditions1.

  See page 40 Enterprise adoption of AI.

Connected care: The future of healthcare

The NHS is working towards integrated care systems (ICS) that bring together health and social care. Access to and use of data (both clinical and operational) will be a key part of this, providing the ability to assess performance, analyse patient cohorts and improve preventative medicine. EMIS’s investment in the EMIS-X platform, including the soon to be deployed FHIR (fast healthcare interoperability resource) layer, combined with its connected care capabilities across primary, acute, community and pharmacy settings position it well for this next phase.

OpenSAFELY: An example of trusted research environment for data

A key concern for individuals regarding the use of their clinical data by third parties is that they are unsure what the information is being used for and they have no control over where it goes. NHS England has tried to introduce the GPDPR (general practice data for planning and research) service, which extracts clinical data from patient records that can then be used by approved third parties. Controversy over the anonymity (or otherwise) of the data led to many patient opt-outs and the project was paused. The government is looking to make various improvements to the programme, including the development and implementation of a trusted research environment in NHS Digital.

EMIS is working with Ben Goldacre, a prominent data scientist and doctor, on the OpenSAFELY project. This allows researchers to make requests to use specific patient data; using software tools provided by OpenSAFELY the data are anonymised and analysed in situ, never leaving the platform on which they reside, and the results returned to the researchers. EMIS supports the OpenSAFELY COVID-19 project, which allows researchers to analyse data from 35 million patient records on the EMIS platform to gain insights into both the short- and long-term effects of COVID19.

ESG strategy under development

The company is currently developing its ESG proposition, pulling together a number of existing initiatives. The board has approved the plan and will shortly create a committee to strengthen and develop its ESG strategy.

Outlook and changes to forecasts

Management noted that it has ‘a clear line of sight to meet Board expectations for H2’ and noted that it was moving from a development phase to a growth phase, reiterating the medium-term revenue growth target of 5–9%. Our FY22 revenue growth forecast of 5.3% and FY23 forecast of 5.6% are in line with this plan. The company also noted that future growth is likely to come from the combination of smaller new business wins across its whole product portfolio rather than from one specific area.

As the company capitalised a lower amount of development costs in H121 than we expected, we have reduced our forecast for the year and for related amortisation. We have also reduced our FY21 depreciation forecast to reflect the amount reported in H121. We have increased our dividend forecasts for all three years. Forecasts on an EMIS-adjusted basis (ie before accounting for capitalisation of development costs) are unchanged at the operating profit and net income level. We have slightly increased our dilutive share count forecasts, which results in a small cut to our diluted adjusted EPS forecasts.

Exhibit 3: Changes to estimates

£'000s

FY21e

FY21e

Change

y-o-y

FY22e

FY22e

Change

y-o-y

FY23e

FY23e

Change

y-o-y

Old

New

Old

New

Old

New

Revenues

164,139

164,113

(0.0%)

2.9%

172,741

172,741

0.0%

5.3%

182,448

182,448

0.0%

5.6%

Normalised operating profit

43,440

41,792

(3.8%)

(2.9%)

46,169

46,329

0.3%

10.9%

49,038

49,198

0.3%

6.2%

Normalised operating margin

26.5%

25.5%

(1.0%)

26.7%

26.8%

0.1%

26.9%

27.0%

0.1%

Reported operating profit

36,443

33,636

(7.7%)

(6.0%)

40,918

40,429

(1.2%)

20.2%

44,330

44,330

0.0%

9.7%

EMIS adjusted operating profit

41,100

41,092

(0.0%)

4.6%

44,429

44,429

0.0%

8.1%

47,298

47,298

0.0%

6.5%

Adjusted operating margin

25.0%

25.0%

(0.0%)

25.7%

25.7%

0.0%

25.9%

25.9%

0.0%

Normalised diluted EPS (p)

56.2

53.7

(4.4%)

(4.7%)

59.7

59.5

(0.3%)

10.8%

63.3

63.1

(0.3%)

6.1%

Reported EPS (p)

47.3

43.7

(7.6%)

(9.1%)

53.1

52.5

(1.2%)

20.0%

54.3

54.3

0.0%

3.5%

EMIS diluted adjusted EPS (p)

53.2

52.8

(0.6%)

4.7%

57.4

57.1

(0.6%)

8.1%

57.7

57.3

(0.6%)

0.5%

Dividend per share (p)

34.0

35.2

3.5%

10.0%

35.0

36.0

2.9%

2.3%

36.0

37.0

2.8%

2.8%

Net cash

53,763

55,322

2.9%

4.4%

68,435

68,045

(0.6%)

23.0%

84,939

84,175

(0.9%)

23.7%

Source: Edison Investment Research

Valuation

Our peer group includes companies involved in clinical, healthcare analytics and medicines management software. The tables below show how EMIS compares in terms of financial performance (Exhibit 4) and valuation metrics (Exhibit 5). EMIS is at the top of its peer group in terms of EBIT margins but is at the lower end in terms of revenue growth and consequently earnings growth. It trades at a discount to the peer group average/median on all metrics, with a dividend yield at the top end of the group. Reacceleration of growth post COVID-19 will be a key driver of upside. We note that EMIS has £48m in net cash plus further credit lines (£15m undrawn bank facility plus £15m accordion) available to invest in growth if suitable M&A opportunities present themselves.

Exhibit 4: Peer financial metrics (%)

Company

EBIT margin

EBITDA margin

Rev growth

EPS growth

CY

NY

NY+1

CY

NY

NY+1

CY

NY

NY+1

CY

NY

NY+1

EMIS

25.5

26.8

27.0

32.2

34.3

34.0

2.9

5.3

5.6

-4.7

10.8

6.1

Allscripts Healthcare Solutions

9.4

10.4

10.9

18.0

18.5

18.9

-8.4

2.4

2.6

6.6

6.2

3.1

Cegedim

7.8

8.1

8.4

21.2

21.3

21.7

3.9

4.0

3.5

107.5

12.7

11.8

Cerner Corp

21.4

22.2

23.2

32.7

33.8

34.6

5.2

5.2

4.6

14.7

9.9

15.3

Computer Programs & Systems

N/A

N/A

N/A

18.7

20.1

22.4

5.6

6.8

8.9

21.8

11.6

22.2

Craneware

27.9

26.1

27.3

35.1

44.1

43.0

5.5

6.8

9.3

3.8

10.6

8.5

CompuGroup

13.3

14.7

16.0

21.6

22.8

23.8

22.2

5.1

4.5

8.4

15.2

11.2

Health Catalyst

-25.8

-17.1

-14.6

-4.5

0.3

4.7

26.4

21.5

21.7

N/A

N/A

N/A

Inovalon Holdings

27.3

28.9

N/A

34.9

35.9

36.7

15.7

12.5

11.8

21.2

22.4

20.7

Nexus

12.6

14.3

15.7

21.9

22.9

23.9

16.6

13.8

9.5

31.6

26.1

19.2

NextGen Healthcare

13.8

14.2

11.0

18.4

19.2

20.2

4.6

4.6

4.5

-5.6

8.4

9.7

Omnicell

16.9

17.8

17.2

21.2

22.5

23.6

24.6

13.9

13.7

46.1

11.2

12.3

OPTIMIZERx Corp

N/A

N/A

N/A

15.7

19.7

20.9

40.2

28.6

22.4

161.3

59.3

27.3

Pharmagest Interactive

27.3

27.4

27.6

31.5

32.2

32.4

11.9

11.3

10.0

21.9

15.0

12.9

Tabula Rasa HealthCare

-11.0

-7.9

-7.3

8.1

10.2

12.5

15.2

15.6

13.0

N/A

352.7

80.7

Average

11.7

13.3

12.3

21.0

23.1

24.2

13.5

10.9

10.0

36.6

43.2

19.6

Median

13.5

14.5

15.7

21.2

21.9

23.0

13.6

9.1

9.4

21.5

12.7

12.9

Source: Edison Investment Research, Refinitiv (as at 13 September)

Exhibit 5: Peer valuation metrics

Share

price

Market

cap m

EV/sales

EV/EBITDA

EV/EBIT

P/E

Div yield

CY

NY

CY

NY

CY

NY

CY

NY

CY

NY

EMIS

£13.68

866

5.0

4.7

15.5

13.8

19.6

17.7

25.5

23.0

2.6%

2.6%

EMIS - adjusted profitability

5.0

4.7

15.5

13.8

19.9

18.4

25.9

24.0

2.6%

2.6%

Allscripts Healthcare Solutions

$14.31

1,789

1.3

1.3

7.3

7.0

14.0

12.4

17.7

16.6

0.0%

0.0%

Cegedim

€28.15

394

1.2

1.2

5.8

5.6

15.7

14.6

17.0

15.1

0.0%

0.0%

Cerner Corp

$74.45

22,006

4.0

3.8

12.1

11.2

18.5

16.9

22.8

20.8

1.1%

1.0%

Computer Programs & Systems

$36.35

532

2.3

2.1

12.0

10.5

N/A

N/A

13.5

12.1

4.4%

4.4%

Craneware

£24.70

878

15.5

14.5

44.1

32.9

55.4

55.5

51.1

46.2

0.0%

0.0%

CompuGroup

€82.30

4,426

4.9

4.7

22.7

20.4

36.9

31.7

40.4

35.0

0.7%

0.7%

Health Catalyst

$55.96

2,794

11.3

9.3

N/A

N/A

N/A

N/A

N/A

N/A

0.0%

0.0%

Inovalon Holdings

$40.45

6,324

9.2

8.2

26.4

22.8

33.7

28.3

53.8

44.0

N/A

N/A

Nexus

€74.40

1,172

6.2

5.4

28.2

23.6

48.9

38.0

59.5

47.2

0.3%

0.3%

NextGen Healthcare

$15.00

1,009

1.6

1.6

8.8

8.1

11.7

10.9

16.2

15.0

0.0%

0.0%

Omnicell

$159.67

6,942

6.1

5.4

28.9

23.8

36.2

30.2

43.0

38.7

N/A

N/A

OPTIMIZERx Corp

$68.85

1,213

18.6

14.5

118.3

73.4

N/A

N/A

131.8

82.7

N/A

N/A

Pharmagest Interactive

€97.70

1,484

7.8

7.0

24.7

21.7

28.5

25.5

39.3

34.2

1.2%

1.3%

Tabula Rasa HealthCare

$28.79

720

3.1

2.7

38.0

26.1

N/A

N/A

311.2

68.8

N/A

N/A

Average

6.6

5.8

29.0

22.1

30.0

26.4

62.9

36.6

0.8%

0.8%

Median

5.5

5.0

24.7

21.7

31.1

26.9

40.4

35.0

0.1%

0.1%

Source: Edison Investment Research, Refinitiv (as at 13 September)

Exhibit 6: Financial summary

£'000s

2016

2017

2018

2019

2020

2021e

2022e

2023e

Year end 31 December

PROFIT & LOSS

Revenue

 

 

158,712

160,354

149,710

159,507

159,453

164,113

172,741

182,448

Cost of Sales

(14,151)

(14,674)

(14,236)

(15,407)

(20,335)

(15,382)

(16,751)

(18,549)

Gross Profit

144,561

145,680

135,474

144,100

139,118

148,731

155,990

163,899

EBITDA

 

 

52,288

49,222

48,919

55,632

53,536

52,892

59,229

62,098

Operating Profit (before amort. of acq. intang, SBP and except.)

38,897

34,895

32,991

40,794

43,020

41,792

46,329

49,198

EMIS adjusted operating profit

 

 

38,753

37,406

35,890

39,273

39,266

41,092

44,429

47,298

Amortisation of acquired intangibles

(6,639)

(6,717)

(6,202)

(7,317)

(6,824)

(6,555)

(4,301)

(3,268)

Exceptionals

(6,714)

(16,988)

1,657

(5,360)

1,802

0

0

0

Share-based payments

(473)

(550)

(766)

(1,290)

(1,440)

(1,600)

(1,600)

(1,600)

Operating Profit

25,071

10,640

27,680

26,827

36,558

33,636

40,429

44,330

Net Interest

(237)

(299)

(180)

(498)

(501)

(500)

(500)

(500)

Profit Before Tax (norm)

 

 

39,159

35,192

33,426

41,038

43,377

42,150

46,687

49,556

Profit Before Tax (FRS 3)

 

 

25,333

10,937

28,115

27,071

36,915

33,994

40,787

44,688

Tax

(5,208)

(2,074)

(5,355)

(5,022)

(6,794)

(6,459)

(7,749)

(10,502)

Profit After Tax (norm)

32,175

27,989

26,447

33,697

35,658

34,141

37,817

40,140

Profit After Tax (FRS3)

20,125

8,863

22,760

22,049

30,121

27,535

33,037

34,186

Average Number of Shares Outstanding (m)

62.8

62.9

63.0

62.9

62.9

63.0

63.0

63.0

EPS - normalised & diluted (p)

 

 

49.4

43.1

40.4

53.5

56.4

53.7

59.5

63.1

EPS - EMIS adjusted & diluted (p)

 

 

49.2

47.0

45.0

51.1

50.4

52.8

57.1

57.3

EPS - FRS 3 (p)

 

 

30.4

12.8

36.1

36.0

48.1

43.7

52.5

54.3

Dividend (p)

23.4

25.8

28.4

31.2

32.0

35.2

36.0

37.0

Gross Margin (%)

91.1%

90.8%

90.5%

90.3%

87.2%

90.6%

90.3%

89.8%

EBITDA Margin (%)

32.9%

30.7%

32.7%

34.9%

33.6%

32.2%

34.3%

34.0%

Operating Margin (before GW and except.) (%)

24.5%

21.8%

22.0%

25.6%

27.0%

25.5%

26.8%

27.0%

BALANCE SHEET

Fixed Assets

 

 

133,292

122,979

117,920

101,089

105,518

97,721

94,178

92,168

Intangible Assets

110,953

100,844

96,807

82,345

85,295

77,440

73,039

69,671

Tangible Assets

22,187

22,037

21,000

18,399

19,870

19,070

19,070

19,570

Other fixed assets

152

98

113

345

353

1,211

2,069

2,927

Current Assets

 

 

46,088

56,900

53,107

67,278

87,170

93,213

107,709

125,833

Stocks

1,815

1,633

1,264

657

613

613

613

613

Debtors

39,970

40,148

36,223

33,047

29,993

33,722

35,495

37,489

Cash

4,303

13,991

15,620

31,099

53,008

55,322

68,045

84,175

Current Liabilities

 

 

(56,158)

(65,131)

(60,169)

(55,700)

(63,370)

(59,813)

(60,800)

(64,161)

Creditors

(51,425)

(65,131)

(60,169)

(55,060)

(62,380)

(58,823)

(59,810)

(63,171)

Lease liabilities

0

0

0

(640)

(990)

(990)

(990)

(990)

Short term borrowings

(4,733)

0

0

0

0

0

0

0

Long Term Liabilities

 

 

(9,080)

(6,734)

(8,199)

(8,469)

(10,180)

(6,119)

(4,487)

(5,062)

Long term borrowings

0

0

0

0

0

0

0

0

Lease liabilities

0

0

0

(3,294)

(5,891)

(5,380)

(4,869)

(4,358)

Other long term liabilities

(9,080)

(6,734)

(8,199)

(5,175)

(4,289)

(739)

382

(704)

Net Assets

 

 

114,142

108,014

102,659

104,198

119,138

125,001

136,600

148,777

CASH FLOW

Operating Cash Flow

 

 

43,657

48,834

49,873

50,059

64,138

45,606

60,444

63,464

Net Interest

(324)

(356)

(214)

(93)

(54)

(500)

(500)

(500)

Tax

(7,655)

(8,139)

(5,830)

(4,466)

(11,684)

(8,008)

(8,871)

(9,416)

Capex

(12,084)

(11,342)

(12,767)

(13,119)

(9,491)

(8,000)

(11,800)

(12,300)

Acquisitions/disposals

(1,790)

329

(9,269)

5,152

(953)

(2,000)

(2,000)

0

Financing

881

571

906

(2,369)

1,324

(2,000)

(500)

(500)

Dividends

(14,006)

(15,476)

(21,070)

(18,745)

(19,860)

(21,272)

(22,539)

(23,109)

Net Cash Flow

8,679

14,421

1,629

16,419

23,420

3,825

14,235

17,640

Opening net debt/(cash)

 

 

9,109

430

(13,991)

(15,620)

(31,099)

(53,008)

(55,322)

(68,045)

Finance leases initiated

0

0

0

(940)

(1,511)

(1,511)

(1,511)

(1,511)

Other

0

0

0

0

0

0

0

0

Closing net debt/(cash)

 

 

430

(13,991)

(15,620)

(31,099)

(53,008)

(55,322)

(68,045)

(84,175)

Source: EMIS Group, Edison Investment Research


General disclaimer and copyright

This report has been commissioned by EMIS Group and prepared and issued by Edison, in consideration of a fee payable by EMIS Group. Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2021 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

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London +44 (0)20 3077 5700

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United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

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Level 4, Office 1205

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Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

General disclaimer and copyright

This report has been commissioned by EMIS Group and prepared and issued by Edison, in consideration of a fee payable by EMIS Group. Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2021 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

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