SHARES in Craneware, the Scottish healthcare-focused revenue management specialist, surged more than 12 per cent in early morning trading yesterday on news that it had secured a major US contract with a large hospital network and achieved a record sales performance.
Edinburgh-based Craneware, which has found its niche in the US healthcare market and has offices in Atlanta and Pittsburgh, will supply the network in the eastern US with its Pharmacy ChargeLink solution. Craneware’s technology will be rolled out to the 12 facilities across the network from October.
The software firm said the contract was expected to deliver revenue in excess of $6 million (£4.5m) over its initial five-year term.
Craneware, in a trading update for the year to June 30, pointed to “strong underlying new sales growth” in line with its growth strategy. “Renewals by dollar value have continued at over 100% in the period,” the statement said. It added that the group expected to report increases of approximately 16% in revenue and 20% in adjusted earnings before interest, tax, depreciation and amortisation (Ebitda), extending its run of organic double-digit growth.
Having returned $15m to shareholders and invested a further $4m in the employee benefit trust during the year, the group’s cash conversion has resulted in the cash balances returning to similar levels to those seen at the end of the previous year, $53m.
Keith Neilson, chief executive, said: “These record results demonstrate the ongoing momentum we are seeing across all strata of hospitals including large and complex health systems as they embrace the realities of value-based economics within healthcare.
“The strength of our solutions and the value they deliver allows us to support our customers as they address the challenges resulting from the continued evolution of the US healthcare market. We are playing an increasingly strategic role in assisting healthcare providers to deliver better healthcare through sustainable financial performance, while mitigating operational and compliance risks.
“These factors, combined with our financial strength and high levels of visible revenue for future years, gives management confidence in its continuing ability to deliver increasing stakeholder value year on year while investing in our future."
Craneware will announce results for the year in September.
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