Craneware '˜stronger than ever' as profits rise 10%

Healthcare software specialist Craneware today said it was in a 'stronger position than ever' as it unveiled a 10 per cent rise in annual profits.

Craneware chief executive Keith Neilson. Picture: Neil Hanna
Craneware chief executive Keith Neilson. Picture: Neil Hanna

The Edinburgh-based firm, which develops billing software for the US hospitals sector, posted a pre-tax profit of $13.9 million (£10.4m) for the 12 months to the end of June, up from $12.5m a year earlier, on revenues 11 per cent higher at $49.8m.

Chief executive Keith Neilson said the figures represented the Aim-quoted company’s third consecutive year of record sales performance, boosted by a 63 per cent surge in new sales. He highlighted two “significant” five-year contract wins during the year, worth a combined $15.5m.

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Neilson told The Scotsman: “Even if you strip those contracts out, we still had a very good year for sales.”

With just two months to go before the US presidential election, Neilson said both Hillary Clinton and Donald Trump had made it clear they want to see value for money in the healthcare system, “and anything that drives towards that has got to be a good thing”.

He added: “Unfortunately in healthcare there’s no one outcome that can be defined as ‘better’, so we believe we can make a difference in helping hospitals that are well managed have a healthy margin that can be reinvested in care. They can then deliver better training, equipment, facilities and wards to provide those various outcomes to patients.”

Craneware employs about 250 people, of whom 120 are based at its Tanfield headquarters in Edinburgh. Next year will mark the tenth anniversary of its flotation on Aim.

Neilson, who said the firm was on the look-out for more acquisitions following the £1.25m purchase of Ullapool software outfit Kestros in 2014, added: “Craneware is in a stronger position than ever and we are passionate about the opportunity ahead. Importantly, the investment we are making in our product suite mean our market opportunity is now several times larger than it was when we joined Aim in 2007.”

The board proposed a final dividend of 9p a share, to be paid on 8 December, giving a total payout for the year of 16.5p – up from 14p last time.

Analysts at house broker Peel Hunt said: “The US healthcare market continues its evolution towards value-based care with a critical dependency on accurate financial and operating data. We believe that Craneware is extremely well positioned to benefit from this dynamic for the medium and long term.”