Craneware, which provides software to the US healthcare sector, has posted strong full-year results backed by a 10% hike in its final dividend.
The Edinburgh-based company, which rejected a takeover approach in the second half of the year, confirmed that acquisitions will be a feature of its growth plans and said trading in the first months of the new year has been positive.
Profit before tax jumped to $23.9 million for the year to the end of June from $15.75m on a 9% rise in reported revenue to $205.7m ($189.2m). Annual Recurring Revenue grew 7% to $184m. Statutory profit before tax saw substantial growth, up 52% to $24m.
The board has proposed a final dividend of 18.5p per share, resulting in a total dividend of 3p per share.
Post period, a new $100m unsecured revolving credit facility was agreed with its banks.
Keith Neilson, CEO, said: “The year has seen us deliver on our commitment to increase our growth rate, while maintaining strong profit margins, reducing bank debt, increasing our dividend and providing an admirable return on our customers’ investment in the group’s software.
“We continue to invest in R&D to strengthen our product set, leveraging our proprietary data assets to expand our offerings, launch new AI enabled applications and integrate third-party solutions onto the Trisus platform. Meanwhile, our partnership with Microsoft is proving a success, accelerating sales cycles and driving further innovation.
“Trading in the current year has started well, and with high customer retention rates, market leading offerings, specialist healthcare expertise and a significant proprietary data set, we have strong foundation on which to build.
“The growth in both ARR and NRR in the year demonstrates the strength of our Annuity SaaS business model, backed by multi-year contracts, providing a basis for growth acceleration in the year to come, and we look to the future with confidence.”
During the second half of the fiscal year, the company received an unsolicited approach from Bain Capital with an outline proposal to acquire the company for £26.50 per share.
The board had not entered into formal negotiations with the party, nor had any formal due diligence taken place, it said.
“In June, we announced this proposal was unanimously rejected by the board and restated the board’s belief in the future prospects for Craneware. We were very gratified by the shareholder support we received following the conclusion of this approach.”
Speaking afterwards to Daily Business, Mr Neilson said investment in AI would help accelerate the company’s growth and would create opportunities for employees.
“It makes the job more interesting by removing the mundane side and making people more productive,” he said.
“I see people enjoying their work more and allowing them to do significantly more with the same resources. That allows us to scale more effectively and get to another growth stage quicker.”
Shares in the AIM-quoted company were trading 15.5p lower at 2254.5p in the first hour of trading, giving a market capitalisation of £844m.
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