Quarterly financial information as of December 31, 2022
IFRS – Regulated information – Audited
Full year 2022 results: Revenue and investments both up
- 2022 revenues rose 5.8% to €555.2 million
- Recurring operating income(1) came to €25.7 million
- Consolidated net profit attributable to the Group came to €13.6 million
Boulogne-Billancourt, France, March 23, 2022, after the market close
Cegedim generated consolidated revenues of €555.2 million(3) in 2022, an increase of 5.8% as reported and 5.0% like for like(2) compared with the previous year, and recurring operating income(1) came to €25.7 million, down by 35.7%.
Consolidated income statement
| 2022 | 2021 | Change | |||
| (in €m) | (in %) | (in €m) | (in %) | (in %) | |
| Revenue(3) | 555.2 | 100.0% | 524.7 | 100.0% | 5.8% |
| EBITDA(1) | 96.2 | 17.3% | 104.7 | 20.0% | -8.1% |
| Depreciation & amortization | -70.5 | -12.7% | -64.8 | -12.3% | 8.8% |
| Recurring operating income(1) | 25.7 | 4.6% | 39.9 | 7.6% | -35.7% |
| Other non-recurring operating income and expenses(1) | 0.8 | +0.1% | 3.8 | 0.7% | -78.4% |
| Operating income | 26.5 | 4.8% | 43.7 | 8.3% | -39.4% |
| Financial result | -8.8 | -1.6% | -10.4 | -2.0% | -15.5% |
| Total tax | -4.6 | -0.8% | -5.8 | -1.1% | -20.5% |
| Net profit attributable to owners of the parent | 13.6 | 2.5% | 26.2 | 5.0% | -48.0% |
| Recurring earnings per share(1) (in euros) | 0.9 | – | 1.8 | – | -50% |
| Earnings per share (in euros) | 1.0 | – | 1.9 | – | -47% |
Consolidated revenues rose €30.5 million, or 5.8%, to €555.2(3) million in 2022 compared with €524.7 million in 2021. The positive scope effect of €4.1 million, or 0.8%, was attributable to the first-time consolidation in Cegedim’s accounts of new acquisitions Kobus Tech, MesDocteurs, Laponi, Sedia, and Clinityx. The positive currency impact was €0.4 million, or 0.1%.
Like-for-like(1) revenue increased 5.0% over the period.
Recurring operating income(1) fell €14.2 million to €25.7 million in 2022, compared with €39.9 million in 2021. It represented 4.6% of 2022 revenue compared with 7.6% in 2021. The decline was mainly the result of a major recruitment campaign in response to growth at Cegedim Santé, some turbulence affecting the healthcare professionals business in the UK, and sustained R&D investment.
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(1) Alternative performance indicator. See pages 134-136 of the 2021 Universal Registration Document.
(2) At constant scope and exchange rates.
(3) As a result of a restatement of provisions following the January 26, 2022, revenue announcement, we have adjusted 2022 revenues from €555.6 million to €555.2 million.
Other non-recurring operating income and expenses(1) registered a profit of €0.8 million in 2022. The main components include a gain from the sale of shares of Healthcare Gateway Ltd in the UK, which was nearly offset by €4.2 million of restructuring costs and a €10.3 million impairment of non-current assets.
Depreciation and amortization expenses increased €5.7 million, chiefly due to an increase in R&D amortization, which rose €4.4 million compared with 2021.
EBITDA(1) was down €8.5 million between 2022 and 2021 as a result of higher employee costs (+€24.7 million) and external charges (+€12.5 million).
Financial result was -€8.8 million, of which €2.0 million related to IFRS16, €1.6 million better than in 2021, owing to a €0.7 million gain from currencies.
Analysis of business trends by division
| in millions of euros | Total | Software & services | Flow | Data & Marketing | BPO | Corporate and others |
| Revenue | ||||||
| 2021 | 524.7 | 292.0 | 84.2 | 98.4 | 47.3 | 2.7 |
| 2022 | 555.2 | 302.0 | 90.6 | 106.9 | 53.0 | 2.8 |
| Change | 5.8% | 3.4% | 7.5% | 8.6% | 11.9% | 2.0% |
| Recurring operating income | ||||||
| 2021 | 39.9 | 12.8 | 11.1 | 14.6 | 2.5 | -1.1 |
| 2022 | 25.7 | -4.9 | 13.1 | 17.9 | 3.0 | -3.4 |
| Change | -35.7% | -138.0% | 17.6% | 22.9% | 20.7% | -210.0% |
| Recurring operating margin | ||||||
| 2021 | 7.6% | 4.4% | 13.2% | 14.8% | 5.2% | -40.3% |
| 2022 | 4.6% | -1.6% | 14.4% | 16.8% | 5.6% | -122.5% |
- Software & Services: 2022 revenues rose 3.4%, driven by good performances at Cegedim Santé (+16% in H2) and HR solutions (+10.0% over the full year). Recurring operating income (REBIT)(1) amounted to a loss of €4.9 million in 2022, a €17.8 million decrease compared with the €12.8 million profit of 2021. There were two main reasons for the decline. First, Cegedim Santé recruited large numbers of new hires to keep pace with its growth (notably in sales, support staff, and R&D), which caused its REBIT(1) to fall by €9.9 million year on year. Second, international business REBIT(1) fell by €8.1 million year on year. Sales were unable to compensate for the loss of Boots as a client in the pharmacy segment in the UK and, as expected, the lack of a window for marketing solutions for doctors in the UK (governed by the NHS). The other companies in the division posted 1.9% REBIT(1) growth compared with 2021.
| Software & Services | Change 2022 / 2021
|
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| in millions of euros | 2022 | 2021 | ||
| Revenue | 302.0 | 292.0 | 10.0 | 3.4% |
| Cegedim Santé | 69.6 | 63.1 | 6.5 | 10.3% |
| Insurance, HR, Pharmacies, and other services | 183.5 | 175.0 | 8.5 | 4.8% |
| International businesses | 48.9 | 53.9 | -5.0 | -9.3% |
| Recurring operating income(1) | -4.9 | 12.8 | -17.7 | -138% |
| Cegedim Santé | -7.8 | 2.2 | -9.9 | -457.2% |
| Insurance, HR, Pharmacies, and other services | 14.3 | 14.0 | 0.3 | 1.9% |
| International businesses | -11.4 | -3.3 | -8.0 | -241.1% |
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(1) Alternative performance indicator. See pages 134-136 of the 2021 Universal Registration Document.
- Flow: Revenues rose 7.5%, led by Cegedim e-business (process digitalization and electronic data flows), whose French and international businesses grew by 8.8% and 25.1% respectively. Over the same period, Third-party payer systems posted 3.3% growth. Both businesses made positive contributions to the division’s 17.6% REBIT(1) growth.
- Data & Marketing: marketing and data activities made positive contributions to the division’s revenue growth compared with 2021 of respectively 9.5% and 7.9%. Division REBIT(1) rose 22.9% compared with 2021, buoyed by the data business in France and abroad and by advertising in pharmacies.
- BPO: operations continued to post double-digit growth over the full year (+11.9% vs 2021), driven equally by services aimed at insurance companies and mutual groups, and by those designed for clients’ HR departments. Both businesses made positive contributions to REBIT(1), which rose 20.7% compared with 2021 on the back of productivity gains achieved during the year, notably thanks to process automation and the use of Software & Services division software.
- Corporate and others: 2022 REBIT(1) was a €3.4 million loss, €2.3 million higher than the loss in 2021. The deterioration was caused by an effort to standardize methods for reinvoicing corporate office activities, notably in the areas of R&D and IT systems, as well as lower margins at the offshore corporate centers.
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(1) Alternative performance indicator. See pages 134-136 of the 2021 Universal Registration Document.
Highlights
To the best of the company’s knowledge, there were no events or changes during 2022 that would materially alter the Group’s financial situation.
- Investment and strategic partnership between Cegedim and 3 social protection companies
On May 16, 2022, Cegedim Group and social protection companies Malakoff Humanis, Groupe VYV, and PRO BTP Groupe announced that they had finalized the strategic partnership they began negotiating on March 1, 2022.
This strategic partnership will advance the goals laid out by the French government in its Ma Santé 2022 plan. The partnership will draw on the recognized expertise of Cegedim, Malakoff Humanis, Groupe VYV, and PRO BTP, who all share the goal of improving patients’ access to care and making the course of care as smooth as possible.
To this end, Malakoff Humanis, Groupe VYV, and PRO BTP Groupe—who together represent 25 million beneficiaries in France—subscribed a reserved capital increase of €65 million on May 24, 2022, and now own 18% of the shares of Cegedim Santé. Cegedim Santé houses all of Cegedim Group’s software products and services for doctors and allied health professionals in France, covering the care pathway from online appointment scheduling to management of patient records, invoicing, and teleconsultation. In addition, its Resip subsidiary supplies information on medications and medical devices.
The deal values Cegedim Santé at €360.9 million. As part of the deal, Cegedim Santé acquired Groupe VYV subsidiary MesDocteurs, a telehealth solution pioneer and one of the originators of 24/7 telemedicine.
On June 21, 2022, Cegedim SRH acquired Laponi, an innovative solution for managing absenteeism in real time. Laponi, a French startup founded in 2016, has successfully developed a digital SaaS platform that lets companies ask internal and external employees to cover shifts when someone is absent. The Laponi solution is easy to use and alerts employees in real time about tasks that need to be done. Employees are then free to choose tasks while boosting their income. The acquisition enhances Cegedim SRH’s TeamsRH HRIS platform.
As a standalone component in Cegedim SRH’s portfolio, Laponi will be able to help solve absenteeism issues at the company’s 400 clients, and its solution will benefit from Cegedim SRH’s technical and financial resources as well as its sales force.
The company is profitable and began contributing to the Group’s consolidation scope in the third quarter of 2022.
On July 19, 2022, Cegedim e-business rounded out its Hospitalis offering by acquiring Sedia, which has specialized in software that tracks medical instrumentation usage since 1985. Thanks to this acquisition, Hospitalis now offers a medical device and implantable medical device (MD/IMD) tracking service. The service is responsible for 900,000 scans annually and has tracked more than 8 million IMDs. The newest component in the Hospitalis range, Sedia offers health, financial, and logistical tracking of MD/IMDs that are on consignment or have been lent or purchased outright.
Sedia is profitable and began contributing to the Group’s consolidation scope in the third quarter of 2022.
On July 28, 2022, Cegedim strengthened its position in the real-world data sector by acquiring 70% of Clinityx.
Clinityx a health start-up founded in 2018, aims to make real-word data research easier by providing a robust scientific, technical, and regulatory environment. The company partners with academic establishments to build data warehouses paired with the SNDS, the French administrative healthcare database, enriching the health data and ensuring their good governance and security. It also provides consulting services and manages all aspects of real-world studies from protocol design to final report, using data from its own warehouses, the SNDS, and other databases.
Clinityx is profitable and began contributing to the Group’s consolidation scope in the third quarter of 2022.
- Healthcare Gateway Limited divestment
In October 2022, In Practice Systems Ltd, which is 100% owned by Cegedim SA, sold all of its shares in the UK company Healthcare Gateway Limited (HGL). Prior to the sale, the 50% non-controlling stake in HGL had been consolidated using the equity method.
Cegedim, jointly with IQVIA (formerly IMS Health), is being sued by Euris for unfair competition. Cegedim has asked the court to dismiss the case against the Group. On December 17, 2018, the Paris Commercial Court granted Cegedim’s request, which IQVIA then appealed. On December 8, 2021, the Court of Appeals upheld the judgement in favor of Cegedim. That ruling is currently under appeal.
After consulting its external legal counsel, the Group decided not to set aside any provisions.
On February 21, 2018, Cegedim SA received official notice that the French tax authorities planned to perform an audit of its financial statements for the period from January 1, 2015, to December 31, 2016. After consultation with its lawyers and based on ample precedent, the Group believes that the adjustment related to the use of tax-loss carryforwards is unwarranted and continues to explore its options to appeal the decision. On October 21, 2021, Cegedim SA received official notice that the French tax authorities planned to perform an audit of its financial statements for the period from January 1, 2019, to December 31, 2020. That audit has not resulted in any adjustments other than those the Group is already appealing.
As part of this process, in the first half of 2022 Cegedim SA received a notice of collection and paid a total of €12.1 million in respect of tax losses used through 2020 and a €0.4 million late payment penalty. The corresponding entry for these payments is not in the taxes line of the income statement, but rather the deferred tax assets line of the balance sheet, as we expect these sums to be repaid once the dispute has been resolved in our favor. Furthermore, as the Group’s accounting method and legal arguments are sound, it continues to record the disputed tax losses as an asset equal to €20 million in deferred tax assets on the balance sheet.
In the event of an unfavorable ruling, based on the deferred tax assets used as of December 31, 2022, Cegedim faces a maximum risk of €23 million, of which it has already paid €12.1 million, and the cancellation of €20 million in deferred tax assets, which would not entail any cash disbursement.
Cegedim believes that the risk of an unfavorable ruling is small and plans to continue using the remaining disputed deferred tax assets. Thus, if the ruling is ultimately unfavorable, the maximum risk in terms of a reversing entry in the tax line of the accounts will increase, but the impact on the cash position would still be more modest, as the Group continues to make periodic payments in respect of the collection notice.
Significant transactions and events post December 31, 2022
To the best of the company’s knowledge, there were no post-closing events or changes that would materially alter the Group’s financial situation.
The Group does not do business in Russia or Ukraine and has no assets exposed to those countries.
Outlook
Despite the economic, geopolitical, and monetary uncertainties facing the world, we are confident we will be able to grow our revenues. Based on the currently available information, the Group expects 2023 like-for-like revenue(2) growth to be around 10% relative to 2022.
REBIT(1) is expected to grow, notably thanks to the initial returns on investments made in Cegedim Santé and international activities.
These targets may need to be revised if there is a resurgence in the Covid-19 pandemic and/or a significant worsening of geopolitical and macroeconomic risks.
The Group does not expect to make any significant acquisitions in 2023.
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The Audit Committee met on March 22, 2023. The Board of Directors, chaired by Jean-Claude Labrune, met on March 23, 2023, and approved the consolidated financial statements at December 31, 2022. It will ask the Shareholders’ Meeting to approve the accounts for fiscal 2022. The consolidated accounts have been audited. The certification report will be issued once the requisite filing procedures for the Universal Registration Document have been completed.
The Universal Registration Document will be available in a few days’ time, in French and in English, on our website and the Cegedim IR app.
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(1) Alternative performance indicator See pages 134-136 of the 2021 Universal Registration Document.
(2) At constant scope and exchange rates.
2023 financial calendar
| 2023 | March 24 at 10:00 am
April 27 after the close June 16 at 9:30 am July 27 after the close September 20 after the close |
SFAF meeting – Cegedim auditorium in Boulogne Billancourt
Q1 2023 revenues Shareholders’ meeting H1 2023 revenues First-half 2023 results |
Financial calendar: https://www.cegedim.fr/finance/agenda/Pages/default.aspx
| Disclaimer This press release is available in French and in English. In the event of any difference between the two versions, the original French version takes precedence. This press release may contain inside information. It was sent to Cegedim’s authorized distributor on March 23, 2023, no earlier than 5:45 pm Paris time. The figures cited in this press release include guidance on Cegedim’s future financial performance targets. This forward-looking information is based on the opinions and assumptions of the Group’s senior management at the time this press release is issued and naturally entails risks and uncertainty. For more information on the risks facing Cegedim, please refer to Chapter 7, “Risk management”, section 7.2, “Risk factors and insurance”, and Chapter 3, “Overview of the financial year”, section 3.6, “Outlook”, of the 2021 Universal Registration Document filled with the AMF on April 16, 2022, under number D.21-0320. |
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About Cegedim:
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| Aude Balleydier Cegedim Media Relations and Communications Manager Tel.: +33 (0)1 49 09 68 81 aude.balleydier@cegedim.fr |
Jérôme Moreau Cegedim Group Director of Management Control Head of Financial Communication Tel.: +33 (0)1 46 10 72 62 jerome.moreau@cegedim.com |
Céline Pardo .becoming Media Relations
Tel.: +33 (0)6 52 08 13 66 |
|
Annexes
Consolidated financial statements at December 31, 2022
- Assets at December 31, 2022
| In thousands of euros | 12/31/2022 | 12/31/2021 |
| Goodwill | 198,761 | 187,107 |
| Development costs | 3,081 | 8,436 |
| Other intangible fixed assets | 185004 | 171489 |
| Intangible non-current assets | 188,085 | 179,925 |
| Property | 544 | 544 |
| Buildings | 1,872 | 2,088 |
| Other property, plant, and equipment | 39,467 | 35,032 |
| Advances and non-current assets in progress | 133 | |
| Rights of use | 88,988 | 84,002 |
| Tangible fixed assets | 131,004 | 121,667 |
| Equity investments | 1 | 315 |
| Loans | 15,642 | 15,223 |
| Other long-term investments | 5,053 | 5,771 |
| Long-term investments – excluding equity shares in equity method companies | 20,696 | 21,308 |
| Equity shares in equity method companies | 20,578 | 2,1266 |
| Deferred tax assets | 30,385 | 33,506 |
| Prepaid expenses: long-term portion | 0 | 108 |
| Non-current assets | 589,509 | 564,886 |
| Goods | 6,495 | 4,503 |
| Advances and deposits received on orders | 177 | 140 |
| Accounts receivables: short-term portion | 151,757 | 136,343 |
| Other receivables: short-term portion | 50,497 | 48,743 |
| Current tax credits | 16,557 | 2,123 |
| Cash equivalents | 0 | 0 |
| Cash | 55,553 | 24,160 |
| Prepaid expenses: short-term portion | 19,370 | 16,688 |
| Current assets | 300,406 | 232,700 |
| TOTAL Assets | 889,915 | 797,586 |
- Liabilities and shareholders’ equity at December 31, 2022
| In thousands of euros | 12/31/2022 | 12/31/2021 |
| Share capital | 13,337 | 13,337 |
| Consolidated retained earnings | 271,344 | 200,717 |
| Group exchange gains/losses | -13,141 | -8,214 |
| Group earnings | 13,624 | 26,224 |
| Shareholders’ equity, Group share | 285,164 | 232,064 |
| Minority interest | 18,971 | 323 |
| Shareholders’ equity | 304,135 | 232,387 |
| Financial liabilities | 188,913 | 186,574 |
| Current lease liabilities | 75,907 | 70,297 |
| Deferred tax liabilities | 6,137 | 8,272 |
| Retirement benefit commitments | 25,397 | 34,069 |
| Provisions | 2,355 | 2,255 |
| Non-current liabilities | 298,709 | 301,467 |
| Financial liabilities | 3,854 | 2,560 |
| Current lease liabilities | 15,916 | 16,072 |
| Trade payables and related accounts | 55,709 | 48,245 |
| Current tax liabilities | 247 | 1,483 |
| Tax and social security liabilities | 112,341 | 101,004 |
| Provisions | 2,172 | 2,065 |
| Other liabilities | 96,832 | 92,304 |
| Current liabilities | 287,071 | 263,732 |
| TOTAL Liabilities | 889,915 | 797,586 |
- Income statement as of December 31, 2022
| In thousands of euros | 12/31/2022 | 12/31/2021 |
| Revenue | 555,209 | 524,709 |
| Purchases used | -26,559 | -26,703 |
| External expenses | -119,913 | -107,414 |
| Taxes | -6,259 | -6,782 |
| Employee costs | -303,577 | -278,841 |
| Impairment on accounts receivable and other receivables and on contract assets | -298 | -158 |
| Allowances to and reversals of provisions | -4,609 | -4,102 |
| Other operating income and expenses | -8 | 1,161 |
| Share of income of equity method companies | 2216 | 2828 |
| EBITDA(1) | 96,202 | 104,698 |
| Depreciation expenses other than right-of-use assets | -53,302 | -48,348 |
| Depreciation expenses of right-of-use assets | -17,228 | -16,453 |
| Recurring operating income(1) | 25,673 | 39,897 |
| Non-recurring operating income and expenses | 820 | 3,789 |
| Other non-recurring operating income and expenses(1) | 820 | 3,789 |
| Operating income | 26,492 | 43,686 |
| Income from cash and cash equivalents | 114 | 90 |
| Cost of gross financial debt | -8949 | -8357 |
| Other financial income and expenses | 45 | -2,104 |
| Financial result | -8,790 | -10,371 |
| Income taxes | -5882 | -7128 |
| Deferred tax | 1,272 | 1,292 |
| Tax | -4,610 | -5,836 |
| Share of profit (loss) for the period of equity method companies | -1,013 | -1,179 |
| Consolidated net profit | 12,079 | 26,300 |
| Group share | 13,624 | 26,224 |
| Income from equity-accounted affiliates | -1,545 | 76 |
| Average number of shares excluding treasury stock | 13,658,348 | 13,782,436 |
| Recurring earnings per share (in euros) | 0.9 | 1.8 |
| Earnings per share (in euros) | 1.0 | 1.9 |
(1) Alternative performance indicator
- Cash flow statement as of December 31, 2022
| In thousands of euros | 12/31/2022 | 12/31/2021 |
| Consolidated net profit | 12,079 | 26,300 |
| Share of earnings from equity method companies | -1,203 | -1,649 |
| Depreciation and amortization expenses and provisions | 83,090 | 64,438 |
| Capital gains or losses on disposals of operating assets | -31 | -141 |
| Cash flow after cost of net financial debt and taxes | 93,935 | 88,948 |
| Cost of net financial debt | 8,791 | 10,370 |
| Tax expenses | 4,609 | 5,836 |
| Operating cash flow before cost of net financial debt and taxes | 107,335 | 105,155 |
| Tax paid | -21,309 | -4,119 |
| Change in working capital requirement: Requirement | 0 | -5,057 |
| Change in working capital requirement: Release | 450 | 0 |
| Cash flow generated from operating activities after tax paid and change in working capital requirements | 86,476 | 95,979 |
| Acquisitions of intangible assets | -58,554 | -50,748 |
| Acquisitions of tangible assets | -17,582 | -14,015 |
| Acquisitions of long-term investments | -2,619 | -3,199 |
| Disposals of tangible and intangible assets | 2,099 | 668 |
| Disposals of long-term investments | 1,636 | 2,040 |
| Change in deposits received or paid | -717 | -674 |
| Impact of changes in consolidation scope | 52,483 | -5,128 |
| Dividends received from outside the Group | 3,084 | 950 |
| Net cash flow used in investing activities | -20,170 | -70,106 |
| Capital increase | 0 | 0 |
| Dividends paid to minority shareholders of consolidated cos. | -95 | -2 |
| Dividends paid to shareholders of the parent company | -6,831 | 0 |
| Debt issuance | 0 | 0 |
| Debt repayments | -85 | -1,156 |
| Employee profit sharing | 81 | 431 |
| Repayment of lease liabilities | -19,036 | -16,808 |
| Interest paid on loans | -4,949 | -4,995 |
| Other financial income received | 1,784 | 369 |
| Other financial expenses paid | -4,758 | -4,576 |
| Net cash flow used in financing activities | -33,889 | -26,736 |
| Change in net cash excluding currency impact | 32,417 | -863 |
| Impact of changes in foreign currency exchange rates | -1,024 | 289 |
| Change in net cash | 31,393 | -574 |
| Opening cash | 24,159 | 24,734 |
| Closing cash | 55,553 | 24,159 |
| In thousands of euros | 12/31/2022 | Criterion |
| Net debt(1) | 84,356 | |
| EBITDA | 77,445 | |
| Leverage ratio | 1,09 | < 2.5 |
| In thousands of euros | 12/31/2022 | Criterion |
| Interest expense | 5,275 | |
| EBITDA | 77,445 | |
| Interest cover ratio | 14.68 | > 4.5 |
(1) Excluding profit sharing debt, FCB loan, and IFRS16 debt
(2)
The Group complied with all these covenants as of December 31, 2022, and there is no foreseeable risk of default.
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