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COMPUGROUP MEDICAL SE & CO. KGAA

(COP)
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CompuGroup Medical : Q2 2021 Interim Report

08/05/2021 | 03:46am EST

Half-Year Financial Report

1 January - 30 June 2021

Financial Highlights Q2/2021

  • Group revenues at 241 mEUR, up 34 % compared to prior year quarter
  • Very good organic revenue growth at 10.1 %, without Telematics Infrastructure at 5.6 %
  • Recurring revenue share at 67 %
  • Adjusted EBITDA increase by 14 % to 51 mEUR
  • EBITDA margin of 21 % below prior year due to investments in growth

Free Cash flow with - 6 mEUR, strong half year at 65 mEUR (prior year quarter: - 3 mEUR, prior year half year: 48 mEUR)

  • Adjusted earnings per share at 0.43 EUR (prior year quarter: 0.38 EUR)
  • Guidance confirmed for the financial year 2021

Financial key figures

01.04.-

01.04.-

01.01.-

01.01.-

kEUR

30.06.2021

30.06.2020

Change

30.06.2021

30.06.2020

Change

Revenues

240,827

179,880

+34%

469,765

363,023

+29%

Recurring Revenues in %

67%

69%

-2 ppt

68%

68%

+0 ppt

Organic growth in %

10%

-6%

+16 ppt

7%

-2%

+9 ppt

EBITDA adjusted

51,034

44,637

+14%

97,565

88,114

+11%

EBITDA adjusted margin

21%

25%

-4 ppt

21%

24%

-3 ppt

EPS adjusted (EUR) - diluted

0.43

0.38

+13%

0.76

0.72

+6%

CAPEX

13,573

13,512

+0%

26,987

28,193

-4%

Free Cash flow

-5,774

-3,227

+79%

64,631

47,811

+35%

Number of shares outstanding ('000)

52,735

53,735

-2%

52,735

53,735

-2%

CompuGroup Medical SE & Co. KGaA Half-yearfinancial report 2021

NOTICES

Unless otherwise stated, all information and explanatory notes in this report refer to the second quarter of 2021 and 2020, i.e. the three- month period from April 1 to June 30 (Q2), and all percentage changes refer to the respective year-on-year comparison. Due to rounding, totals and percentages presented in this report may not add up precisely to the totals provided.

BUSINESS DEVELOPMENT - SIGNIFICANT EVENTS

COVID-19-pandemic

Protective measures and activities for our employees and customers remain at the focus of our actions in the context of the COVID-19- pandemic. CompuGroup Medical supports our customers indirectly or directly in overcoming the challenges of the pandemic.

In the mid-term, we continue to see increased growth opportunities as the result of the risen and sustainable readiness to use digital solutions in the healthcare sector

Electronical vaccination certificate (eImpfnachweis) in Germany

At the end of May, the German Federal Ministry of Health published a tender for the creation of a certificate module for primary systems to issue COVID-19 certificates. CGM, which serves over 60,000 physicians in Germany with its physician information systems, implemented this module for its physician information systems in June 2021 and made it available to all physicians free of charge. Patients can then view these COVID-19 certificates using a QR code on an app commissioned by the German Federal Ministry of Health, such as the Corona warning app.

ePA in Germany

The electronic health record (elektronische Patientenakte - ePA) has already been promoted from the statutory health insurances side since the beginning of the year, by making the ePA available to the insured persons. The physician information systems of CGM support the filling out of the ePA with the quarterly update in June/July. The module allows a simple data transfer from the physician information system to the ePA, a view of the released documents and also a data transfer from the ePA to the index card of the physician information system.

Positive business development in the Hospital information systems

In the past quarter HIS segment achieved a very positive business development with regard to the further rollout of CGM Clinical. In addition, the Hospital Futures Act (Krankenhauszukunftsgesetz) is providing positive momentum with numerous customer contacts, projects, and several orders. With the Graubünden Conatonal Hospital in Switzerland and further 10 hospitals in Spain in the Murcia region, additional new customers were acquired.

Telematics Infrastructure

In July, ComupGroup Medical received the approval from gematik for the KoCoBox MED+ as a connector for the electronic patient record (elektronische Patientenakte - ePA). Once the ePA upgrade has been installed, the KoCoBox Med+ will support the electronical patient record application and the convenience signature for all users connected to the Telematics Infrastructure vie a the KoCoBox Med+. The rollout will take place in the second half of the year and will provide the next important digitalization step in healthcare.

By the end of the second quarter, approximately 9,000 installations of the KIM module (Communication in medicine - KIM) had been carried out. KIM enables barrier-free, secure, and confidential communication between all service provider institutions and payers in the German health sector.

2 CompuGroup Medical SE & Co. KGaA Half-yearfinancial report 2021

Additional growth through acquisitions

In June, CompuGroup Medical acquired VISUS Health IT GmbH, one of the leading providers of picture archiving and communication systems (PACS) and Healthcare Content Management in Germany. The main products of VISUS group are JiveX Enterprise PACS, a leading PACS solution for hospitals and outpatient facilities, JiveX Healthcare Content Management, a state-of-the-artvendor-neutral archiving solution, and JiveX Healthcare Connect, a communication solution for medical data. Today, VISUS group counts more than 1,500 facilities in the in the inpatient and outpatient sectors among its customers.

The acquisition of Aatlanta group in France, announced in March, was completed at the end of June 2021. Aatlanta group is a software provider for administrative and medical management for healthcare professionals.

The other acquisitions are described in more detail in the section on company acquisitions and disposals.

Share buyback

CompuGroup Medical conducted a share buyback program from February 26 to April 29, 2021. The buyback of shares via the stock exchange (Xetra trading on the Frankfurt Stock Exchange) is performed by a mandated securities bank. With this CompuGroup Medical made use of the authorization given by the Annual General Meeting on May 15, 2019, to repurchase treasury shares. During the period between February 26 and April 29, 2021, 1,000,000 shares in total have been repurchased at an average rate of EUR 71.25.

3

EARNINGS DEVELOPMENT IN THE GROUP

01.04.-

01.04.-

01.01.-

01.01.-

kEUR

30.06.2021

30.06.2020

30.06.2021

30.06.2020

Revenues

240,827

179,880

469,765

363,023

Capitalized inhouse services and other income

13,316

12,141

23,580

21,936

Expenses for goods and services purchased

-43,028

-29,927

-84,480

-62,096

Personnel expenses

-122,269

-89,981

-236,750

-179,588

Other expenses and net impairment losses on financial and contract assets

-38,118

-29,366

-77,014

-60,417

EBITDA

50,728

42,748

95,100

82,858

Depreciation of property, plant and equipment, right-of-use assets and amortization of

intangible assets

-24,519

-17,013

-51,342

-33,795

EBIT

26,209

25,735

43,758

49,063

Financial result

-1,308

-2,508

-2,777

-7,027

EBT

24,900

23,227

40,981

42,036

Income taxes for the period

-7,717

-6,968

-12,798

-12,945

CONSOLIDATED NET INCOME FOR THE PERIOD

17,184

16,258

28,182

29,091

Compared to the prior year quarter, revenues in the second quarter increased by mEUR 60.9 (34 %) to mEUR 240.8. Organic growth in the second quarter of 2021 amounts to 10.1 % year-on-year, which is also attributable to higher revenues in connection with the Telematics Infrastructure. Excluding the revenue growth of the Telematics Infrastructure, organic growth amounts to 5.6 % in the quarter.

Compared to same period of the prior year, revenues in the first half of 2021 increased by mEUR 106.7 (29 %) to mEUR 469.8. Organic growth in the first half of 2021 amounts to 7.5 % compared to the prior year. Excluding the revenue growth of the Telematics Infrastructure, organic growth in this period amounts to 3.5 %.

Adjusted consolidated earnings before interest, taxes, depreciation, and amortization (adjusted group EBITDA) for the second quarter amounts to mEUR 51.0 (prior year: mEUR 44.6) with an adjusted EBITDA margin of 21 % (prior year: 25 %). The margin decrease is due to the announced investments in further growth.

Adjusted group EBITDA for the first half of 2021 amounts to mEUR 97.6 (prior year: mEUR 88.1) with an adjusted EBITDA margin of 21 %

(prior year: 24 %). Here too, the decline in margin is attributable to the announced investments in further growth.

Adjusted group EBITDA is derived from reported EBITDA as shown below:

01.04.-

01.04.-

01.01.-

01.01.-

kEUR

30.06.2021

30.06.2020

30.06.2021

30.06.2020

EBITDA REPORTED

50,728

42,748

95,100

82,858

Adjustments:

M&A Transactions

677

819

751

3,772

Share-based option programs

-372

461

1,714

922

Restructuring program expenses

0

0

0

0

Other non-operative, extraordinary or one-time effects

0

609

0

562

EBITDA ADJUSTED

51,034

44,637

97,565

88,114

4 CompuGroup Medical SE & Co. KGaA Half-yearfinancial report 2021

The main developments in operating expenses are:

  • Expenses for goods and services purchased increased by mEUR 13.1 in the second quarter of 2021 compared to the prior year. This is mainly due to increased expenses resulting from acquisitions in the amount of mEUR 7.2. The gross margin

((Revenues

less cost of purchased services)/revenue) of

82 % was 1 % below the gross margin of the prior year quarter.

In the first

half of 2021, the expenses for goods and services

purchased amount to mEUR 84.5 (previous year: mEUR 62.1). In the first

half of 2021, the gross margin reached 82 %, which is 1 % below the prior year as well. The lower gross margin for the second quarter and for the first half of 2021 is mainly attributable to the hardware business in connection with the pharmacy rollout of the Telematics Infrastructure.

  • Personnel expenses increased by 36 % to mEUR 122.3 compared to prior year (mEUR 90.0). Adjusted for special items, personnel expenses were 37 % higher than the prior year quarter. The directors' remuneration (now other expenses), which is no longer reported under personnel expenses due to the change in legal form, was more than offset primarily by acquisitions, which accounted for a

total of mEUR 21.7 and thus 24 %. Many new hires in the areas of product management and sales as well as general wage and salary increases also contribute to the increase in personnel expenses. In the first six months, personnel expenses increased by mEUR 57.2 to mEUR 236.8, of which mEUR 39.8 resulted from acquisitions. The increase in personnel expenses in the first half of the year is mainly due to new hires and salary increases.

  • Other expenses and net impairment losses on financial and contract assets were mEUR 8.7 higher than in the prior year and amounted to mEUR 38.1. Adjusted for special effects of M&A costs, other expenses and net impairment losses on financial and contract assets were mEUR 9.9 higher than in the prior year. The reason for this increase is higher expenses for server maintenance and the reporting of directors' remuneration under other expenses following the change in legal form. Other expenses and net impairment losses on financial and contract assets in the first half of the year were mEUR 77.0 and mEUR 16.6 above the prior year.

Depreciation of property, plant and equipment and right-of-use assets amounts to mEUR 9.1 in the second quarter, which is an increase of mEUR 1.4 (prior year: mEUR 7.7). The increase in depreciation of non-current assets is mainly due to higher depreciation on right-of-use assets (IFRS 16) and increased depreciation of own-used IT equipment.

Amortization of intangible assets increased by mEUR 6.2 to mEUR 15.5 in the second quarter, mainly due to higher amortization from purchase price allocations and higher amortization on self developed software.

Depreciation of property, plant and equipment and right-of-use assets amounts to mEUR 17.4 for the first half of 2021, which is an increase of mEUR 2.3 compared to prior year. Amortization of intangible assets increased by mEUR 15.3 to mEUR 34.0 in the first half of the year.

Amortization of intangible assets breaks down as follows:

01.04.-

01.04.-

01.01.-

01.01.-

kEUR

30.06.2021

30.06.2020

30.06.2021

30.06.2020

AMORTIZATIONS ON INTANGIBLE ASSETS

15,453

9,347

33,988

18,733

thereof from purchase price allocations for business combinations

11,803

5,689

23,144

11,378

thereof from capitalized inhouse services

1,760

1,333

7,059

2,505

Finance income increased from mEUR 0.2 in the second quarter of 2020 to mEUR 0.6 in the second quarter of this year, mainly resulting from currency gains on loans as well as interest income on loans issued. For the half-year, financial income of mEUR 0.7 was generated, which is mEUR 0.3 lower than in the same period of the prior year.

5

Disclaimer

CompuGroup Medical SE published this content on 03 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 05 August 2021 07:45:16 UTC.


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Sales 2021 1 022 M 1 156 M 1 156 M
Net income 2021 79,2 M 89,6 M 89,6 M
Net Debt 2021 535 M 605 M 605 M
P/E ratio 2021 39,0x
Yield 2021 0,88%
Capitalization 3 035 M 3 434 M 3 433 M
EV / Sales 2021 3,49x
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Nbr of Employees 8 079
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Dirk W÷ssner Chairman-Management Board & CEO
Philipp von Ilberg Chairman-Supervisory Board
Frank Brecher Chief Technology Officer
Sven Thomas MŘller Chief Information Officer
Ulrike Handel Member-Supervisory Board
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