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Trading results
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| In the year ended 30 April 2003, the Group delivered profit
before tax growth of 55.0% to £18.9m on turnover of £91.5m,
a profit before tax margin of 20.6% (2002: 20.3%). Adjusting for
the amortisation charge of £4.6m, the normalised profit
before tax was £23.5m (2002: £15.4m), a margin of
25.7% (2002: 25.7%). |
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The continuing positive profit trend
is derived from the sale of the iSOFT
applications to both new and existing
customers in core markets and from a number
of new sales into emerging markets.
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| Following a consistent strategy, iSOFT’s market share
has increased with new business wins and through the strategic
acquisition of customer base. Underlying organic growth in turnover
was 31.2%. |
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| Cash
flow |
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| The quality of the profit generation of the Group is underlined
by the consistently strong cash generation from the operating
results. For 2003, the Group achieved a normalised profit before
tax cash conversion ratio of 100.0% (2002: 109.4%) generating
a net cash inflow from operating activities of £23.5m (2002:
£16.9m). |
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Investment by General Atlantic Partners
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| On 3 March 2003, iSOFT announced an important strategic investment
in the company by General Atlantic Partners. As a result of this
investment, 5.9m new ordinary shares were issued at a price of
215 pence per share raising cash proceeds for the company after
associated costs of issue of £12.4m. |
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The investment by General Atlantic
Partners represented a significant endorsement
of the strength of the iSOFT management,
product proposition, business strategy
and market positioning. |
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Acquisitions
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| On 31 July 2002, the Group acquired the healthcare systems
business of Northgate Information Solutions plc for £33.5m.
Goodwill recorded on the balance sheet in respect of this acquisition
was £31.4m. |
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The operational integration was expeditiously
and successfully executed. In the period
since acquisition, the Northgate business
interests acquired contributed £11.4m
of turnover and £2.6m of operating
profit to the overall Group results.
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| On 28 November 2002 the Group acquired Revive Group Limited,
the leading supplier of e-booking systems to the United Kingdom’s
NHS for a maximum consideration of £4.1m. Of this maximum
consideration, £3.1m is deferred and is contingent on the
achievement of certain financial targets over the next 3 years.
The £1.0m consideration paid in the year was satisfied by
£0.5m in cash and the issue of 211,417 new ordinary shares.
In the period since acquisition, Revive contributed £1.2m
of turnover and £0.4m of operating profit to the 2003 Group
results. |
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Interest
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| The net interest payable in the year of £2.1m (2002:
£1.0m) related principally to the acquisition debt funding
outstanding during the year. The increase in interest payable
in comparison with the previous year is due to the additional
5 year term loan of £30.0m raised to finance the Northgate
acquisition. At the balance sheet date the Group’s net debt
position was £2.9m (2002 net funds: £3.7m). |
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