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Last close As at 09/06/2023
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GBP481m
Research: Healthcare
In a strategic move to support its business development plans and digitisation efforts, Ergomed has announced two senior appointments to its executive team. Michael Spiteri, a serving non-executive director at Ergomed, has been named as the chief transformation and technology officer (CTTO) and Jonathan Curtain has been appointed as deputy chief financial officer. Amid the sustainable and strong momentum in Ergomed’s business in H122 despite market softness, we see that the new additions as underscoring the management’s focus on business expansion and digital transformation.
Ergomed |
Two key management changes |
Management change |
Healthcare services |
18 November 2022 |
Share price performance Business description
Analysts
Ergomed is a research client of Edison Investment Research Limited |
In a strategic move to support its business development plans and digitisation efforts, Ergomed has announced two senior appointments to its executive team. Michael Spiteri, a serving non-executive director at Ergomed, has been named as the chief transformation and technology officer (CTTO) and Jonathan Curtain has been appointed as deputy chief financial officer. Amid the sustainable and strong momentum in Ergomed’s business in H122 despite market softness, we see that the new additions as underscoring the management’s focus on business expansion and digital transformation.
Year end |
Revenue |
Adjusted EBITDA*(£m) |
EPS* |
DPS |
P/E |
Yield |
12/20 |
86.4 |
19.4 |
23.8 |
0.0 |
55.6 |
N/A |
12/21 |
118.6 |
25.4 |
41.3 |
0.0 |
32.1 |
N/A |
12/22e |
140.1 |
28.2 |
40.0 |
0.0 |
33.1 |
N/A |
12/23e |
156.5 |
31.7 |
45.9 |
0.0 |
28.8 |
N/A |
Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.
Both the new appointees come with detailed industry backgrounds, in the information technology and life sciences spaces, respectively. Michael Spiteri has assumed role of CTTO, stepping down from his existing role of non-executive director on the company’s board. He brings over 30 years of experience in the IT sector and has been instrumental in developing Ergomed’s technological/digital capabilities in his role as member of the board. With his appointment in an execution role, we anticipate further enhancement in digital transformation across the company’s operations.
Jonathan Curtain brings 13 years of experience from ICON, a Nasdaq-listed contract research organization with a market cap of $16bn, where he played a key role in the $12bn acquisition of PRA Health Sciences by ICON in 2021. His most recent appointment with ICON was as senior vice president of corporate and commercial finance. We expect Ergomed to leverage his experience to support its strategic expansion plans.
As a recap, Ergomed recently released full H122 results indicating sustained strong momentum across both business segments despite the underlying biotech market softness. The 24.8% y-o-y revenue growth was supported by geographical expansion, forex tailwinds and a £4m contribution from the ADAMAS acquisition. The revenue growth translated into robust margins, which should benefit further from the consolidation of the higher-margin ADAMAS business. The order book continued to be strong (24.9% y-o-y growth), indicating a solid sales pipeline for the coming quarters.
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Research: Healthcare
Respiri continues to expand its commercial footprint in the United States with the signing of another client account, with Minnesota Lung Center (MLC), for an initial three-month pilot study assessing the utility of its wheezo device in a remote patient monitoring (RPM) setting. The pilot study will recruit and monitor 20 patients with asthma and chronic obstructive pulmonary disease over three months, and, if successful, should result in a broader rollout. The deal is the third signed by Respiri in collaboration with Access Telehealth and is especially meaningful given MLC’s core focus on respiratory diseases. As a reminder, Respiri recently announced the first patient enrolment in its wheezo RPM programme in the US, which is eligible for reimbursement under the Centers for Medicare and Medicaid Services’s Current Procedural Terminology reimbursement codes for RPM. We expect feedback from these initial pilot studies (anticipated in Q1 CY23) as crucial to set the path for further commercial progress for wheezo. Our valuation remains unchanged at A$0.24 per share.
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