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Gpi

Earnings Release Mar 30, 2021

4426_rns_2021-03-30_0615915c-447c-4078-a63d-de5e67e0afb6.pdf

Earnings Release

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PRESS RELEASE

GPI: TWO-FIGURE GROWTH IN 2020 REVENUE +12.5%, EBITDA + 24.6%, NET PROFIT + 25.6%

TECHNOLOGY AND STRATEGIC SERVICES IN SUPPORT OF THE HEALTH SYSTEMS

PROPOSED GROSS DIVIDEND OF EUR 0.50 PER SHARE

  • Revenue: EUR 271.0 mln, +12.5% (2019: EUR 240.9 mln)
  • Software and IT services: EUR 102.6 mln, +14.0% (2019: EUR 90.0 mln)
  • Care and administrative services: EUR 132.5 mln, +9.7% (2019: EUR 120.8 mln)
  • Export revenue: EUR 23.9 mln, +20.0% (2019: EUR 19.9 mln)
  • Recurring fees: EUR 165 mln, 61% of revenue (2019: EUR 155 mln)
  • EBITDA: EUR 40.2 mln, +24.6% (2019: EUR 32.2 mln), 16.0% of adjusted revenue
  • Net profit: EUR 12.3 mln, + 25.6% (2019: EUR 9.8 mln)
  • NFP: EUR 117,6 mln including approximately EUR 30 mln for M&As (2019: EUR 82.8 mln)
  • Proposed gross dividend of EUR 0.50 p.s. (pay out ≈64%)
  • Updated the main 2024 Strategic Business Plan economic-financial targets

GPI INVESTOR DAY

The Company will meet with the Financial Community at 15:30 on 14 April 2021 in an audio webcast. The GPI Group top managers will be presenting the results of FY2020 and updating the main economic-financial targets through to 2024.

The event will be held electronically. To attend, please send a request to https://investordaybygpi.bitrix24.site/

Trento, 30 March 2021

The Board of Directors of GPI (GPI:IM), a leading company in Information Systems and Services for Healthcare and Social Services, listed on the MTA market of Borsa Italiana, has today approved the draft separate financial statements and the consolidated financial statements as at 31 December 2020, prepared in accordance with the IAS/IFRS accounting standards.

Fausto Manzana, Chairman and CEO of the Gpi Group: "The very positive results booked for FY 2020 confirm Gpi as a strategic partner for the world of healthcare. During this unique emergency, we have shown that our strength lies in our ability to react quickly, operating alongside healthcare facilities so as to guarantee the continuity of essential services for our citizens. Our proposals are the result of a vision of healthcare based on two key drivers: digitisation and territoriality. The Gpi Group strives to facilitate the digital transformation of the healthcare processes, so as to make them more secure, efficient and sustainable. It is a priority of all countries and considerable resources are assigned to this area. We look to the future with great faith, because we have the technological and process skills necessary to contribute towards this essential change".

MAIN CONSOLIDATED RESULTS AS AT 31 DECEMBER 2020

REVENUE

Revenue comes to EUR 271.0 mln, up +12.5% on the EUR 240.9 mln recorded in 2019, driven by both organic growth (+ 6.6%) and growth through external lines (+ 5.9%).

REVENUE BY STRATEGIC BUSINESS AREA (SBA)

87% of the GPI Group revenue is achieved by the 2 main Strategic Business Areas (SBAs):

  • Software and IT services: solutions enabling and facilitating the digital transformation of the whole of Healthcare, innovating care processes in hospitals, on the territory and at the patients' homes, manage the whole of the transfusion process chain, assist with administration (ERP/HR) and support healthcare professionals' decisions.
  • Care and administrative services: administrative services and access to care (CUP, Contact Centre) and complete telemedicine systems to make care available electronically and intercept the new health demands constituting a point of reference for almost 30 million citizens.
Revenue by SBA (EUR mln) 2020 % 2019* % Var. %
Software and IT services 102.6 37.9% 90.0 37.4% 14.0%
Care and administrative services 132.5 48.9% 120.8 50.2% 9.7%
Other 35.9 13.2% 30.0 12.5% 19.4%
Total
revenue
and
other
consolidated
income
271.0 100% 240.9 100% 12.5%

*Revenue has been restated following the reclassification of Xidera's business, which is more consistent with patient intake services and therefore switches from the Software SBA to the Care SBA (EUR 1.7 mln).

The Software and IT services SBA is the area that makes the greatest use of technological drivers like big data & analytics, artificial intelligence, cloud technology and the internet of things, so as to enable management of data and decisions in an increasingly predictive manner; it records revenue of EUR 102.6 mln (38% of the total), + 14.0%, as compared with the EUR 90.0 mln booked in 2019 (37% of the total).

The Care and administrative services SBA is the area in which the GPI Group leads the Italian market. Total revenue came to EUR 132.5 mln (49% of the total), +9.7% on the EUR 120.8 mln in 2019 (50% of the total). At present, approximately 50% of the Italian population turns to GPI for its reservations and contact with healthcare facilities.

The Other SBAs (Automation, ICT, Pay) made a positive contribution towards the results, recording total revenue of EUR 35.9 mln, +19.4% on the EUR 30.0 mln booked in 2019.

REVENUE FROM RECURRING FEES

An analysis of revenue by type shows that a significant portion of revenue is generated by recurring fees, which in 2020 total EUR 165 mln (61% of revenue). The Software and IT services SBA recorded revenue from recurring fees accounting for approximately 42% of all the area revenue; the Care and administrative services SBA instead recorded revenue from recurring fees accounting for approximately 81% of total area revenue.

Revenue is mainly generated in Italy, where +11.8% growth is recorded. FY 2020 also records a significant increase in revenue generated Abroad, which comes to EUR 23.9 mln (8.8% of the total and +20.0% on the EUR 19.9 mln booked in 2019).

Revenue by geographic area (EUR mln) 2020 % 2019 %
Italy 247.1 91.2% 221.0 91.7%
Abroad 23.9 8.8% 19.9 8.3%
Total revenue and other consolidated income 271.0 100% 240.9 100%

ADJUSTED REVENUE

Adjusted revenue reflects the value of total revenue net of the amounts provisionally earned by the Company, but pertaining to the lead companies in the temporary business groupings. In 2020, adjusted revenue came to EUR 250.9 mln, up 12.3% on the EUR 223.3 mln of 2019.

GROSS OPERATING MARGIN (EBITDA)

It is important to note that once again in 2020, a significant commitment was demanded of the commercial, production and administrative structure aimed at optimising the integration process of new acquisitions that have widened the scope of consolidation. The table below shows the contributions made in terms of EBITDA by the business areas.

EBITDA by SBA (EUR mln) 2020 % of
adjusted
revenue
2019* % of
adjusted
revenue*
Software and IT services 27.3 27.0% 22.1 24.8%
Care and administrative services 7.4 6.5% 6.4 6.2%
Other 5.4 15.1% 3.7 12.3%
Total consolidated EBITDA 40.2 16.0% 32.2 14.4%

* Restated following the reclassification of Xidera's business, which is increasingly more consistent with patient intake services and switches from the Software SBA to the Care SBA.

EBITDA came to EUR 40.2 mln, up 24.6% on the EUR 32.2 mln of 2019. The EBITDA margin came to 14.8% of revenue and 16.0% of adjusted revenue.

NET OPERATING PROFIT (EBIT)

EBIT came to EUR 18.9 mln, up 25.6% on the EUR 15.1 mln of 2019, after amortisation/depreciation for EUR 20.7 mln, which reflects the Group's strong investment policy, mainly for acquisitions and again for the continuous innovation of the technological solutions and services offered to the market.

EARNINGS BEFORE TAXES (EBT)

EBT came to EUR 13.2 mln, showing an increase on the EUR 12.8 mln in 2019.

Financial operations were impacted by exchange losses (EUR/USD) and negative changes to financial assets and liabilities. Interest expense for loans and bonds has risen on the previous year, going from EUR 3.4 mln to EUR 4.7 mln.

NET RESULT

The net result is EUR 12.3 mln, up 25.6% on the EUR 9.8 mln in 2019, after tax of almost EUR 1 mln (EUR 3.0 mln in 2019). Tax management came in at 7.3%, down on the 23.7% recorded in 2019.

Tax management recorded a positive change following the realignment of non-tax recognised values on certain assets, as well as use of the patent box benefit.

NET WORKING CAPITAL

Net working capital came to EUR 109.0 mln; the increase on the EUR 91.3 mln recorded in 2019 is mainly due to the growth seen in revenues, with an impact on total receivables in the amount of EUR 18.7 mln. Trade payables dropped by EUR 2.2 mln, while inventories rose, primarily in connection with the development of automated warehouses commissioned and stocks of telemedicine devices that had not yet been delivered at year end (EUR +1.3 mln).

SHAREHOLDERS' EQUITY

Shareholders' equity came to EUR 83.3 mln; the change on 2019 (EUR 72.1 mln) is mainly due to period profit. The Group is financing its Net Invested Capital with 41% from its own resources.

NET FINANCIAL POSITION

The net financial position came to EUR 117.6 mln, up 34.8 mln on 31/12/2019 (EUR 82.8 mln). The value of the NFP reflects the impact of the M&As carried out during the year, for an equivalent value of approximately EUR 30 million, as well as technical (tangible and intangible) investments of EUR 13.4 mln.

EMPLOYEES

As at 31 December 2020, the GPI Group workforce numbered 6,111 (5,345 at 31 December 2019), spread out between the numerous sites throughout Italy and at the foreign subsidiary offices in Austria, France, Germany, Malta, Poland, Russia, Spain and the USA.

MAIN RESULTS OF THE PARENT GPI S.P.A. AS AT 31 DECEMBER 2020

The parent company GPI S.p.A. has recorded total revenue of EUR 196.8 mln (+12.6% on the EUR 174.8 mln of 2019), EBITDA of EUR 24.1 mln) (EUR 21.6 mln in 2019) and a net profit of EUR 8.6 mln (EUR 13.8 mln in 2019).

PROPOSED ALLOCATION OF THE PROFIT/LOSS FOR THE YEAR

The Board of Directors has resolved to make the following proposed allocation of the Gpi Group profit (EUR 12.3) million) to the Ordinary Shareholders' Meeting convened for 30 April 2021, for which the call notice was published on the company's website last 19 March and then, in extract form, in the newspapers the following day:

  • distribution of a gross dividend of EUR 0.50 for each share entitled (excluding treasury shares in the portfolio at the coupon date);
  • carry forward the remainder.

In respect of the dividend that will be assigned for payment starting 28 July 2021 - coupon date 26 July 2021 and record date 27 July 2021 - the payout ratio will be approximately 64% of the Group's consolidated profit.

NON-FINANCIAL STATEMENT

The Board of Directors has approved the consolidated non-financial statement (NFS) for FY 2020. This is in compliance with Decree 254/16, which envisages the disclosure of information about the policies applied and the results achieved in terms of the prevention of corruption, protection of human rights, HR management and the social and environmental impacts of the business.

The NFS reports on the most relevant topics for the Group and its stakeholders-shareholders, defined through the materiality analysis conducted with the help of the management. The commitment for the application of the ethical principles in the conduct of company business and the supply of quality services to the public was highlighted in particular. What emerges is a context of continuous development of the Company, which has seen growth in employment and a maintained focus on the continuous innovation of products and services.

The perimeter of the data and information given in the GPI S.p.A. NFS includes the Italian and foreign companies making up the Group as at 31.12.2020, consolidated on a line-by-line basis (unless excluded for good reason) and covers the three years 2018-2020.

SIGNIFICANT EVENTS IN 2020

COVID-19

For GPI as well, the COVID-19 health emergency that the World Health Organisation (WHO) has defined as a pandemic has turned into a situation that is as unexpected as it is complex. When the emergency struck, the main priorities were immediately identified and the Group took prompt action.

Gpi has rigorously complied with all provisions of current health and safety regulations. Solutions have been applied that are designed to create barriers to the spread of the virus (e.g., minimum distances between workstations, work shifts to reduce crowding, constant disinfection measures, restrictions in the use of common areas, etc.); at the same time, initiatives have been taken to review the organisation of work which, in addition to contributing to safety aspects, have also guaranteed the continuity of productivity of our collaborators. Smart working has been and continues to be one of the choices made to help ensure continuity of business, offering a better work/life balance.

From a business point of view, Gpi's response to the emergency has shown the Group's capacity to adapt and effectively and quickly respond to the needs that have emerged during the pandemic.

And this response has given rise to a series of key solutions by which to address the health emergency, such as: reservation systems to handle incoming flows of people to the various public and healthcare services, pervasive adoption of telemedicine solutions to monitor patients at home, use of screening systems to dispense the nasal-pharyngeal swabs, through to a layering system of the population so as to define the priorities for accessing COVID vaccinations, adopted by the region of Val D'Aosta during the early months of 2021. This has also been made possible, indeed above all, by the adaptation of technologies and services already present in the Gpi product portfolio, thereby proving the validity of the health model proposed, based on two main drivers: digitisation and territoriality.

Other significant events:

  • In January, CERVED confirmed the public rating of Gpi S.p.A. as "A3.1";
  • late February, the newly-established subsidiary Medsistemi s.r.l., held 100% by Gpi, purchased the whole of the Consis BU, a company operating in the healthcare and social services sector with solutions for the design, development, installation and maintenance of IT and digital systems;

  • in April, 65.35% of OSLO s.r.l., a company specialised in the supply of management systems for the public and private healthcare industry, was acquired (through a put and call agreement for the transfer of the residual 34.65%);

  • April also saw the acquisition of the majority share (58.39%) of Umana Medical Technologies, a Maltese start-up founded in 2017 that develops innovative, non-invasive solutions like the nanomaterial tattoo sensors for the remote monitoring of vital parameters;
  • late May, two important agreements were signed in the software segment Blood Management System for the acquisition of the Haemonetics assets, a US company listed on the New York Stock Exchange and for the acquisition of the French GroupMedinfo. The Haemonetics transaction was completed in July through the conferral of assets to the newco Gpi USA Inc. The acquisition increases the product range on the donor side and brings with it more than 100 customers in the USA;
  • in July, following on from the exercise of the call option, Gpi had acquired the remaining 29.7% of Bim Italia S.r.l., thereby coming into possession of all shares. The transaction, together with the acquisition of OSLO s.r.l., is part of the plan to strengthen Gpi's capacity in the management and business analytics information systems segment, a segment that offers high margins and is strategic to the efficient management of healthcare processes;
  • in July, Sintac s.r.l. and Business Process Engineering s.r.l., companies that are already part of the Group, were incorporated into Gpi S.p.A. starting 1 August 2020;
  • again in July, Gpi acquired the remaining 60% of the shares in the associate TBS IT Telematic & Biomedical Services s.r.l., it began its merger into the parent company, which was then concluded in November;
  • in August, CERVED confirmed the public rating of Gpi S.p.A. as "A3.1";
  • in August, the debenture loan "GPI S.p.A. 3,50% 2019-2025" was reopened (see the dedicated paragraph of this document). Gpi has placed bonds with institutional investors for an additional nominal EUR 20 mln (first tranche of EUR 4.5 mln in September and second tranche of EUR 15.5 mln in November), concluding the placement well ahead of the 31 December 2020 deadline. Resources are mainly allocated to continuing with M&As and research and development, as per the Strategic Business Plan guidelines, with specific reference to the international development of Software SBA;
  • In October, Gpi was awarded and important tender in the Basilicata region, relative to software solutions and contact centre services, for the reservation of specialised visits and the implementation of the Digital Agenda. The successful bid submitted by Gpi, as member of a temporary business grouping, comes to EUR 14.7 million (60% is Gpi's share) for a duration of two years, with the possibility of renewing for another two;
  • in November, the Gpi BoD resolved to adhere to the new Corporate Governance Code approved by the Borsa Italiana Corporate Governance Committee and published on 31 January 2020. The adoption of the new Code guarantees that the company is constantly aligned with the international best practices of listed companies;
  • in December, the Gpi Group obtained EUR 3 mln in orders as part of the multi-channel management of health service reservation services in Emilia Romagna, Apulia and Campania, thus providing evidence of the continued expansion, even during the closing months of a complex 2020, so severely impacted by COVID-19.

SIGNIFICANT EVENTS AFTER THE CLOSE OF THE YEAR

• Early January saw Gpi complete its acquisition of 100% of the Medinfo Group, a key supplier of transfusion solutions in France and in many other countries. The acquisition is an integral part of the Gpi Group globalisation strategy in segments offering high margins such as software solutions for the blood management system. Gpi has here become one of the world's leading players, also thanks to the acquisitions of Guyot-Walser Informatique, again in France, the Spanish Hemasoft Software S.L. and the

assets of Haemonetics, which have flowed into Gpi USA Inc.;

  • in January, Gpi announced completion of the acquisition of the remaining 40% of the share capital of the subsidiary Hemasoft Software S.L., lead partner of the Iberian group by the same name, thereby becoming sole shareholder, in execution of the framework agreement stipulated on 15 September 2017;
  • in February, Gpi, lead partner of a temporary business grouping, was awarded a new order for the fiveyear management of multi-channel patient intake services of the healthcare facilities of the Region of Liguria. The tender was awarded thanks to the high score received for the quality of the technical project, with an economic bid of EUR 14.95 million (60% Gpi);
  • following the 08 February 2021 publication of the 2020 preliminary data (consolidated revenues of approximately EUR 270 million, EBITDA approximately EUR 40 million with an EBITDA margin above 14.5% and net financial position of approximately EUR 120 mln), Cerved Rating Agency has updated Gpi's rating, confirming it as "A3.1".

OUTLOOK

The difficulties experienced throughout 2020 worldwide, have increased the Group's awareness of the strategic role it plays in healthcare, particularly in our country. This awareness comes in addition to the operations on a market characterised by a significant "movement" that sees us face important challenges, for which it is important to be ready both in terms of structure and propositions. The pandemic has clarified just how essential health is and how much it calls for global responses.

In this scenario, the Gpi Group is guaranteeing responses to two major needs. The first is to govern the requests of large groups of the population; the second is to have ever more efficient, evolved technological solutions. The Care and administrative services SBA is, by vocation, the answer to the first need, that of inclusively, simply and quickly guaranteeing access to care by people who are in any way fragile, making increasing use of digital technologies. The Software and IT services SBA is the answer to the second point, through the employment of smart solutions that can satisfy the great dynamism dictated by time.

The value created by the integration of these two business areas has proved essential, such as, for example, the Region of Lazio, which has stood out for its optimal handling of the pandemic. The integration of technological solutions and the patient governance system is the model to be spread throughout our country and beyond.

The increasing need on the part of customers to manage certain strategic aspects of health in a centralised manner, such as, for example, appropriateness and sustainability, offers reassurance on the Group's investments in acquiring BIM and Oslo Italia. Indeed, these companies can develop solutions that on various different levels, depending on the information needs, offer sets of indicators by which to facilitate choices that are usually made "blind" or with information that is not entirely truthful. Use of a "managerial dashboard" will become increasingly essential to the governance of healthcare strategies.

The evolution of the strategic Software area will, on the one hand, confirm the contribution to be guaranteed by the administrative solutions over the next few years and, on the other, the market growth of the clinical type solutions whose investments yield results in line with forecasts. The experience in Malta is a clear validation that the solutions produced are in line with those requested by even the most demanding customers, and not only in our country.

The growth line abroad is also confirmed, with specific reference to the software segment product lines for the blood management system. The acquisition of the Haemonetics assets together with the establishment of GPI USA and the early 2021 acquisition of Medinfo are all investments that strengthen the area

development strategy. The Automation world is the second development line of the export market that is yielding results; the slowing generated by the COVID effect has reversed tack.

2021 is showing very interesting signs of recovery. The COVID-19 emergency has put health back in the spotlight and a huge quantity of economic resources (national and European) will be allocated to the organisational and technological innovation of the health systems: essential investments to redesign a health service that can adequately respond to new health demands in a sustainable manner. The prospects outlined open up new horizons, with significant potential for growth for the Gpi Group, starting this year.

UPDATE OF THE MAIN 2024 ECONOMIC-FINANCIAL TARGETS

The Gpi Group 2020 - 2024 Strategic Business Plan, unveiled on the Gpi Virtual Investor Day held on 16 April 2020, set out 3 main economic-financial targets to be achieved by 2024 (Revenue > EUR 290 mln, EBITDA margin > 15% and NFP ≤ 1 x EBITDA), calculated while keeping the consolidation scope through to 31/12/2019 unchanged.

Following the M&As and the organic growth that characterised FY 2020, as well as the onset of the health crisis sparked by the COVID-19 pandemic, these targets were updated to take into account these new assumptions, keeping the strategic approach of the plan unchanged.

The new targets through to 2024, on a like-for-like consolidation scope at 31 December 2020, as examined by today's Board of Directors, envisage:

  • Revenue > EUR 330 mln
  • EBITDA Margin > 16.5%
  • NFP ≤ 1 x EBITDA

BOND ISSUES AND ISSUES REACHING MATURITY

In August 2020, the reopening of the bond loan "GPI S.p.A. - 3,50% 2019-2025" was resolved, as had been issued by the Company on 20 December 2019, listed on the ExtraMOT-Professional Segment, for a total nominal amount of up to EUR 20 mln. As a consequence of the issue of additional securities, the total nominal amount of the debenture loan comes to EUR 50 mln.

The 2019-2025 bonds accrue interest at a gross annual fixed nominal rate of 3.5%. Interest payments (coupon detachment) take place on a half-yearly basis, in arrears. The 2019-2025 bond was issued at par as from 20 December 2019 and dividends rights began on the same date. The maturity for the 2019-2025 bonds was set for 20 December 2025 and redemption will be at par and, therefore, at 100% of the nominal value;

The redemption value, maturing in the 18 months following the closure at 31 December 2020 of the debenture loans issued by Gpi S.p.A., is as follows:

Bond ISIN code June 2020 December 2020 June 2021
GPI SpA - 4.3% 2016 - 2023 IT0005187320 1500 1500 1500
GPI SpA - 3% 2017 - 2022 IT0005312886 5000 5000 5000

Nominal redemption value in thousands of euros and maturities

Taking into account the maturities of the loans in place, in light of the future financial commitments and with a view to assuring suitable cash resources to make the most of any growth opportunities as may arise by external lines, the company is considering potentially intervening on the debt by using the debt capital markets and/or bank financing.

***

With regards to the other items on the agenda of the Shareholders' Meeting, in addition to the appointment of the Board of Directors, for which the Explanatory Report has already been published, please note the following:

REPORT ON REMUNERATION POLICY

The Board of Directors has updated the Remuneration Policy, which will be submitted for a binding vote by the shareholders.

PROPOSED RENEWAL OF THE AUTHORISATION TO PURCHASE AND SELL TREASURY SHARES

As the reasons that had last year led to the suspension of purchases and sales of treasury shares no longer apply, the Board of Directors has decided to resubmit for shareholder approval the proposal to authorise the purchase and sale of treasury shares, as set out hereto.

  • a) make investments and establish a shares depository;
  • b) support the liquidity of the ordinary GPI shares, so as to foster the regular conduct of trading and avoid any abnormal price shifts, as well as to regulate the performance of trades and prices, in the face of temporary distortions linked to excessive volatility or a shortage of liquidity in trades;
  • c) use the treasury shares for any share incentive plans reserved to the directors and employees of the Company and/or of its direct or indirect subsidiaries, both through the concession of purchase options and the free assignment of shares (stock option or stock grant plans);
  • d) acquire treasury shares to be used for transactions on capital or other transactions in connection with which it should be necessary, or merely appropriate, to purchase, exchange or sell share packages through the transfer, exchange, conferral or other deed of disposal and/or use, also following acquisitions and/or commercial agreements with strategic partners.

The request for authorisation also includes the faculty to make repeated, subsequent purchases and sales (or other deeds of disposal) of treasury shares on a revolving basis, including for portions of the maximum quantity authorised, so that the quantity of shares concerned by the proposed purchase and held by the Company shall not exceed the limits set by the law and the Shareholders' Meeting authorisation.

The proposal envisages requesting authorisation to purchase treasury shares up to a maximum amount of 2.5% of all shares in issue over time, with no nominal value, considering the treasury shares already acquired and not yet disposed of in fulfilment of previous shareholders' meeting resolutions.

The purchases of treasury shares relate to the pursuit of the purposes indicated under letters (a), (b), (c) and (d) above and shall be made in exchange for payment, including purchase costs, of no less than 15% below the minimum and no more than 15% above the maximum official price of ordinary GPI shares recorded by Borsa Italiana S.p.A. during the trading session prior to that during which the purchase is made.

The authorisation for the purchase of treasury shares is requested for a period of 18 months from when this shareholders' meeting resolution is passed, whilst the authorisation to sell, dispose of and/or use the treasury shares currently held in the portfolio and any that may be acquired, is requested, for lack of any legislative restraints in this respect, without limits in time.

AMENDMENTS OF THE ARTICLES OF ASSOCIATION

The proposed amendments of the articles of association aim to:

  • incorporate:
  • the automatic conversion (which took effect on 06 May 2019) of the 61,320 "Special Category C Shares" by means of the elimination from the articles of association, of all reference, now outdated, made to "Special Category C Shares" and the updating of the text as and where necessary;
  • the changes introduced by Art. 83-duodecies of Italian Legislative Decree no. 58 of 24 February 1998 on the identification of shareholders;
  • eliminate the minimum number of candidates required for the submission of lists for the appointment of the Board of Directors, thereby facilitating the submission of lists by minorities.
  • make the necessary changes consequent to the new provisions on gender quotas.

The Company believes that, in respect of the proposed amendments to the Articles of Association, in accordance with current legislation, there are no grounds for shareholder withdrawal.

***

Finally, the Board of Directors has successfully verified that 2 of its directors meet the independence requirements laid down by the Code of Corporate Governance and by Italian Legislative Decree no. 58 of 24 February 1998 and that the number of appointments held by the Board of Auditors is appropriate and they too meet the requirements of independence, professionalism and integrity.

***

2021 SHAREHOLDERS' MEETING DOCUMENTATION

It is recalled that in compliance with current legislation, the shareholders' meeting documentation will be made available at the registered office, on the Company's website https://www.gpi.it/investors/eventi/ (Shareholders Meetings-2021 section) and on the authorised storage mechanism (), in particular:

  • by 31 March 2021, the Reports, including the related proposed resolutions, relative to the approval of the financial statements for the year and the allocation of profits;
  • by 08 April 2021, the Annual Financial Report and the other documents envisaged by Art. 154-ter, paragraph 1 of Italian Legislative Decree no. 58 of 24 February 1998, together with the Consolidated Non-Financial Statement;
  • by 09 April 2021, the Explanatory Reports on the Remuneration Policy, the Purchase of treasury shares and that explaining the proposed amendment of the articles of association.

INTEGRATION OF THE 2021 CORPORATE EVENTS CALENDAR

In supplementing the releases given on 28 January 2021 and 03 February 2021, please be informed that the 2021 corporate events calendar has been integrated with a new appointment: 14 April 2021 – Gpi Investor Day

Presentation of FY2020 results and update of the main 2024 economic-financial targets.

The Manager in charge of financial reporting, Federica Fiamingo, declares in accordance with paragraph 2, Article 154-bis of the Consolidated Finance Act that the accounting disclosure contained in this release coincides with the results of the documents, ledgers and accounting records.

***

GPI GROUP

GPI is the preferred partner for software, technologies and services for healthcare, social services and the public administration. Founded more than 30 years ago in Trento, GPI has grown through significant investments in M&A (in Italy and abroad) and R&D, which it carries out in partnership with leading Italian research centres and universities to share scientific, technological, functional and process knowledge applied to the e-health, e-welfare, well-being sectors.

Also drawing on the solutions and know-how gained from the companies that have joined its ecosystem, the Group has masterfully translated the needs of the healthcare industry into cutting-edge high-tech solutions and new service models that optimise prevention, diagnosis and care processes, improving people's lives.

The offer combines specialised IT expertise with advisory and design capabilities enabling it to operate in a range of business areas: Software, Care, Automation, ICT and Payment services.

The Company reported consolidated revenues of €241 million in 2019, with over 5,300 employees at year end and more than 2,200 customers in over 60 countries.

GPI was listed on Borsa Italiana in 2016 (AIM segment) and moved to the MTA market in 2018. ISIN ordinary shares: IT0005221517 - ISIN "Warrant GPI SpA": IT0005221475

Press release available at www.gpi.it and

CONTACTS

Investor Relations

GPI | Fabrizio Redavid, Lorenzo Giollo | [email protected] | T: +390461381515 | Via Ragazzi del '99, 13 - 38123 Trento

Media Relations

GPI | Daniela Filbier, Enrico Orfano| [email protected] | T: +390461381515 | Via Ragazzi del '99, 13 - 38123 Trento

Specialist

Banca Akros | Bruno Mestice | [email protected] | T. +3902434441 | Viale Eginardo, 29 – 20149 Milan

GPI GROUP CONSOLIDATED INCOME STATEMENT

CONSOLIDATED INCOME STATEMENT 31 December 31 December
in thousands of euros 2020 2019
Revenue 268360 236961
Other income 2661 3959
Total revenue and other income 271020 240920
Raw materials and consumables -9883 -10445
Service costs -72967 -60888
Personnel expense -144588 -134542
Amortisation, depreciation and impairment losses -20656 -16140
Other provisions -561 -1004
Other operating costs -3418 -2819
Operating profit 18945 15081
Financial income 361 1875
Financial expense -6063 -4153
Net financial expense -5702 -2278
Share of profit/(loss) of equity-accounted investees, net of tax - 4
Profit (loss) before tax 13243 12806
Income tax -968 -3034
Profit for the period 12275 9773
Profit for the period attributable to: -
Owners of the parent 11883 9521
Non-controlling interests 392 252

GPI GROUP CONSOLIDATED STATEMENT OF FINANCIAL POSITION

CONSOLIDATED STATEMENT OF FINANCIAL POSITION, in
thousands of euros
31 December
2020
31 December
2019
Assets
Goodwill 42405 26523
Other intangible assets 82470 56656
Property, plant and equipment 27442 27800
Equity-accounted investments 171 170
Non-current financial assets 1292 1199
Deferred tax assets 6778 4983
Contract costs 5928 7088
Other non-current assets 592 921
Non-current assets 167078 125340
Inventories 6054 4770
Contract assets 105090 87510
Trade receivables and other assets 45749 43227
Cash and cash equivalents 80605 53241
Current financial assets 8407 27639
Current tax assets 1087 662
Current assets 246992 217050
Total assets 414070 342390
Equity
Share capital 8545 8545
Share premium reserve 52573 56872
Other reserves and retained earnings/(losses carried forward), including
profit/(loss) for the period
20347 5019
Capital and reserves attributable to owners of the parent 81466 70435
Capital and reserves attributable to non-controlling interests 1814 1660
Total equity 83279 72095
Liabilities
Non-current financial liabilities 154177 109462
Non-current provisions for employee benefits 6845 6075
Non-current provisions for risks and charges 237 225
Deferred tax liabilities 8194 9493
Trade payables and other liabilities 7464 6357
Non-current liabilities 176918 131612
Contract liabilities 81 159
Trade payables and other liabilities 97213 78952
Current provisions for employee benefits 811 749
Current provisions for risks and charges 889 241
Current financial liabilities 52416 54207
Current tax liabilities 2463 4376
Current liabilities 153873 138683
Total liabilities 330791 270295
Total equity and liabilities 414070 342390

GPI GROUP CONSOLIDATED STATEMENT OF CASH FLOWS

CONSOLIDATED STATEMENT OF CASH FLOWS, in
thousands of euros
31 December
2020
31 December
2019
Cash flows from operating activities
Profit for the period 12275 9774
Adjustments for:
- Depreciation of property, plant and equipment 5908 4159
- Amortisation of intangible assets 12701 9682
- Amortisation of contract costs 2047 2299
- Other provisions 561 1004
- Net financial income 5702 2278
- Share of profit/(loss) of equity-accounted investments, net of tax - -4
- Income tax 968 3034
Changes in working capital and other changes -24865 -12776
Interest paid -3978 -3789
Income taxes paid -968 -3814
Net cash flows generated by operating activities 10352 11847
Cash flows from investing activities
Interest collected 215 587
Acquisition of subsidiaries, net of cash acquired -17961 -1879
Net investments in property, plant and equipment -5164 -4422
Net investments in development costs and other intangible assets -8215 -9031
Net change in other current and non-current financial assets -16490 5147
Net cash flows used in investing activities -47614 -9598
Cash flows from financing activities
Acquisition of treasury shares - -793
Dividends paid - -5243
Proceeds from new bank loans 65000 7500
Repayment of bank loans -24672 -24838
Proceeds from bond issues 19752 30000
Bond redemptions -3000 -3000
Lease payments -1150 -353
Lease payments IFRS 16 -3389 -2136
Net change in other current and non-current financial liabilities 19173 9977
Acquisitions of non-controlling interests - -54
Change in liabilities for acquisition of equity investments -7088 -1668
Net cash flows generated by (used in) financing activities 64627 9392
Net increase (decrease) in cash and cash equivalents 27364 11641
Opening cash and cash equivalents 53241 41600
Cash and cash equivalents 80605 53241

GPI S.P.A. INCOME STATEMENT

INCOME STATEMENT 31 December 31 December
In thousands of euros 2020 2019
Revenue 192168 168939
Other income 4626 5850
Total revenue and other income 196795 174789
Raw materials and consumables -10087 -9280
Service costs -55163 -45837
Personnel expense -104859 -96163
Amortisation, depreciation and impairment losses -10746 -8262
Other provisions -840 -940
Other operating costs -2588 -1896
Operating profit 12511 12411
Financial income 1454 6486
Financial expense -7175 -3356
Net financial expense -5721 3130
Share of profit/(loss) of equity-accounted investees, net of tax 2313 738
Profit (loss) before tax 9103 16280
Income tax -464 -2453
Profit for the period 8639 13827

GPI S.P.A. STATEMENT OF FINANCIAL POSITION

STATEMENT OF FINANCIAL POSITION 31 December 31 December
In thousands of euros 2020 2019
Assets
Goodwill 6600 5645
Intangible assets 35013 32258
Property, plant and equipment 20941 22710
Equity-accounted investments 71895 47369
Non-current financial assets 2245 2207
Deferred tax assets 5580 3986
Contract costs 2631 2063
Other non-current assets 172 481
Non-current assets 145077 116719
Inventories 4333 3381
Contract assets 96241 83936
Trade receivables and other assets 34841 32986
Cash and cash equivalents 58830 44178
Current financial assets 21421 31584
Current tax assets 834 396
Current assets 216501 196462
Total assets 361578 313181
Equity
Share capital 8545 8545
Share premium reserve 52573 56872
Other reserves and retained earnings/(losses carried forward), including
profit/(loss) for the period
21053 8917
Total equity 82171 74334
Liabilities
Non-current financial liabilities 151255 107424
Non-current employee benefits 3892 4071
Non-current provisions for risks and charges 169 170
Deferred tax liabilities 203 1519
Other non-current liabilities 1757 2782
Non-current liabilities 157276 115967
Contract liabilities 42 103
Trade payables and other liabilities 64099 61803
Current employee benefits 657 646
Current provisions for risks and charges 307 201
Current financial liabilities 55559 56242
Current tax liabilities 1469 3884
Current liabilities 122132 122879
Total liabilities 279407 238847
Total equity and liabilities 361578 313181

GPI S.P.A. STATEMENT OF CASH FLOWS

CASH FLOW STATEMENT 31 December 31 December
In thousands of euros 2020 2019
Cash flows from operating activities
Profit for the period 8639 13827
Adjustments for:
- Depreciation of property, plant and equipment 4083 2959
- Amortisation of intangible assets 6643 4988
- Amortisation of contract costs 19 315
- Other provisions 840 940
- Net financial income 5721 -3130
- Share of profit/(loss) of equity-accounted investments, net of tax -2313 -738
- Income tax 464 2453
Changes in working capital and other changes -18429 -9352
Interest paid -3974 -3209
Income taxes paid -440 -3233
Net cash flows generated by operating activities 1253 5819
Cash flows from investing activities
Interest collected 152 437
Dividends collected 8 1160
Acquisition of subsidiaries, net of cash acquired -24734 -1805
Change in liabilities for acquisition of equity investments -296 170
Net investments in property, plant and equipment -2284 -2901
Net investments in development costs and other intangible assets -7136 -9485
Net change in other current and non-current financial assets 80 2557
Net cash flows used in investing activities -34209 -9868
Cash flows from financing activities
Acquisition of treasury shares - -736
Dividends paid - -5223
Proceeds from new bank loans 65000 7500
Repayment of bank loans -26866 -17565
Proceeds from bond issues 19752 30000
Bond redemptions -3000 -3000
Lease payments -1553 -1917
Net change in other current and non-current financial liabilities -5723 11098
Net cash flows generated by (used in) financing activities 47610 20157
Net increase (decrease) in cash and cash equivalents 14654 16108
Opening cash and cash equivalents 44178 28071
Cash and cash equivalents as at 31 December 58830 44178

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