Craneware on a high with record full-year earnings
The Edinburgh-based firm, which specialises in software for the US healthcare market and is also marking ten years on London’s Alternative Investment Market (Aim), said underlying pre-tax profits rose 13 per cent to $18 million (£13.4m) for the year to the end of June, on revenues 16 per cent higher at $57.8m.
Chief executive Keith Neilson, who co-founded Craneware with Gordon Craig in 1999, said the Aim-quoted company had secured sales for the first product launched on its new cloud-based platform Trisus, which offers healthcare providers a range of services to identify and take action on risks related to revenue, cost and compliance.
He told The Scotsman: “The platform allows us to grow by migrating over all of our other products, which will be enhanced with extra functionality, but also with brand new products. The first big example of that is our cost analytics platform that we’ve also launched this year.
“It’s quite a diverse portfolio but very consistent in what it’s trying to do – making hospitals financially healthy so they can focus on what’s important, which is giving care.”
US president Donald Trump has so far failed to make good on his promise to “repeal and replace” his predecessor Barack Obama’s signature health plan – dubbed Obamacare – but Neilson said that said such short-term political wrangling had little impact on Craneware.
He added: “The unceasing evolution of the US healthcare market towards value-based care presents us with an ongoing, growing market opportunity and the investments we have made mean we now have the potential to deliver against this expanding opportunity.
“With our sales pipeline increasing each year, this increased scalability and opportunity, combined with our high levels of revenue visibility, strong cash position and extensive customer base provide us with confidence in Craneware’s ongoing success.”
A final dividend of 11.3p a share was proposed, to be paid on 7 December, taking the full-year payout to 20p – up from 16.5p last time.
“Despite all the policy confusion that has been created by the new US administration, hospitals continue to spend money on systems that underpin critical financial and operational data,” said house broker Peel Hunt.
“Craneware, in its products, execution and niche end-market, provides one of the highest-quality investment opportunities in our tech universe.”
With a presence in every state of the US, Craneware employs about 280 people, of whom 135 are based at its Tanfield headquarters in Edinburgh.
When asked about the possibility of expanding into other markets, Nielson said: “The US accounts for 50 per cent of global healthcare spend, but there is an attraction to expanding geographically at a later stage, more likely on the cost analytics side.
“Everybody is struggling with the same challenge of paying for healthcare. There’s definitely a need for systems like ours. There’s something like $700 billion of waste in the US healthcare system.”