Earnings Release • May 17, 2010
Earnings Release
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Dear Stockholders,
NEXUS is growing and becoming increasingly profitable. We also started in the 1st quarter 2010 with this good news: We are thus continuing our trend of many years of increasing sales with simultaneously increasing profits. Analog to our market, which demands reliability and a long-term strategy, we are betting on healthy, profitable growth and a convincing product strategy as our business policy.
Our market and our customers are rewarding this strategy and making it possible for us to win further market shares nationally and internationally. We were also able to improve our position on the market in the first quarter with new orders and successful operation startups in hospitals.
For example, the Vizenz von Paul Hospital in Rottweil decided to introduce NEXUS / HIS and consequently to bet on our new product as another customer to do so. Operation startup of two hospitals on Turs and Caicos Islands is also a very positive event. NEXUS obtained the order for equipping the complete computer system in the two newly built hospitals of the Caribbean island territory. It has been possible in a short introductory phase for both hospitals to work paperless in all clinical areas. The hospitals have become a health policy showpiece project in the region in the meantime. In the large St. Gallen project, additional hospitals have also started live operation with our software, and consequently decisive steps have been taken to achieve cantonal-overlapping patient documentation. In Germany, we were able to start productive operation of the projects in the city hospitals Kiel, Mosbach and Stade and begin further enhancement phases of the project. We were able to expand our installed basis considerably with all of these projects in the first quarter.
On the side of development projects, we were very involved in the software solutions of "Emergency Care Module", "New Financial Accounting and "Intensive Care Module" and "NEXUS / HIS", which resulted and is resulting in forcing us to use our development resources to the limit. We are maintaining the fast pace of our innovations, because we are convinced that we are only at the start of this development, in which hospitals nationally and internationally will invest strongly in software increasing efficiency. We want to keep our lead.
We reorganized our company last year and separated it into the areas "Clinical Information Systems (CIS)", "Diagnostic Information Systems (DIS)" and "IT Services (IT)". We are going to continue this development consistently in this year and can react organizationally to the internationalization of business thanks to the creation of a new business division "NEXUS Clinical Solutions (CSO)". We are going to implement international and development-intensive HIS projects in the business area of CSO in the future. In this way, we will avoid mixing different project types and create room for optimizing specific project workflows. We see the parallel development of independent hospital and diagnostic information systems on the basis of a uniform technology as an essential success factor for our company. We consider the possibility of investing in the hospital and the diagnostic product lines nationally and internationally parallel without committing the error of uncompromising standardization as an essential strength.
The list of our activities demonstrates that we have concluded a substantial program of work during the first months of 2010, which is oriented completely to growth, innovation and revenue optimization. This is a strategy that has a high degree of acceptance on our market and among our customers. The matter is somewhat different on the capital market. We have not been able to convince there with our development till now, which was again reflected in the development of our stock prices in the first quarter. This is a condition, which we cannot be indifferent to and which is difficult to understand against the background of our good business figures of the first quarter.
Sales increased from EUR 9.5 million to EUR 10.3 million (+8.6%) during the first three months. The operating result improved even more.
The result before taxes improved significantly by approx. 51% to KEUR 828 following KEUR 549 in the previous year. After taxes, there was also a substantial improvement in the result. Following KEUR 460 in the previous year, a result of KEUR 668 (+45%) was achieved in the first quarter 2010. The operative cash flow is certainly also to be emphasized here.
The balance sheet relations have in part changed considerably corresponding to 31 December 2009 in the areas of accounts receivables, liquid funds and reserves. Accounts receivable increased greatly analog to business development and amounted to approx. 14.3 million € on 31 March 2010. At the same time, liquid funds including securities increased by approx. 2.1 million € to approx. 13.7 million euros. Other reserves increased by approx. € 0.6 million to approx € 1.7 million.
The good first quarter 2010 makes us confident that we can continue to pursue the course of the past years successfully and maybe even progress faster. In spite of our good development, we still see substantial potential for further increases in all company areas. This applies both to the profitability of our activities and to our growth strength in Germany and abroad.
Dear Shareholders, NEXUS is in a very good position! Our market and production position is excellent and is improving very quickly along with our results.
It is becoming increasingly clearer that we cannot communicate this development sufficiently to the capital
market. The discrepancy between the development of our company and our stock price has become so great in the meantime that we have to look for solutions in the interest of our stockholders and company. The Supervisory Board and the Executive Board are going to deal with this topic intensively in the coming months and discuss various alternatives.
We are resolutely determined – and convinced of this today more than ever – to continue to orient and develop our company, so that we are also among those at the top internationally. This is a challenge and an incentive that drives us forward.
Sincerely
Dr. Ingo Behrendt CEO
NEXUS Group sales increased from KEUR 9,512 to KEUR 10,328 (+8.6%) in the first three months of the year 2010. Both the segments "Healthcare Software" and "Healthcare Service" developed well in the past quarter. Sales in the area of "Healthcare Service" increased by 9.3% to KEUR 1,126 following KEUR 1,122 in the period of the previous year. Sales in the segment of "Healthcare Software" increased by 8.5% from KEUR 8,390 to KEUR 9,102 compared to the same period of the previous year.
Sales in other countries increased to KEUR 3,930 from KEUR 3,600 in the previous year. Sales increased especially strongly in Switzerland and Arab countries. As a result, the share of sales outside of Germany was 38.1% following 37.8% in the previous year. This value demonstrates the high regard for our systems outside of Germany too.
Group (1st Quarter) sales in KEUR
9,512
10,328
+8.6% as of previous year
7,412
| sales by | 01/01/ - | 01/01/ - | Δ in | ||
|---|---|---|---|---|---|
| regions | 03/31/09 | 03/31/10 | |||
| KEUR | KEUR | ||||
| Germany | 5,913 | 6,397 | 8.2 | ||
| Switzerland | 2,215 | 2,769 | 25.0 | ||
| Austria | 257 | 445 | 73.2 | ||
| Italy | 28 | 0 | - | ||
| Rest of world / USA | 1,099 | 716 | -34.8 | ||
| total | 9,512 | 10,328 | 8.6 | ||
| sales by | 01/01/ - | 01/01/ - | Δ in |
| sales by divisions |
01/01/ - 03/31/09 KEUR |
01/01/ - 03/31/10 KEUR |
Δ in % |
|
|---|---|---|---|---|
| Healthcare Software | 8,390 | 9,102 | 8.5 | |
| Healthcare Service | 1,122 | 1,226 | 9.3 | |
| total | 9,512 | 10,328 | 8.6 |
The positive development of the operating result of last year continued during the reporting period. The Group result increased greatly by 45.1% to KEUR 668 (previous year: KEUR 460), and the result before taxes improved by 50.7% to KEUR 828 (previous year: KEUR 549).
The EBITDA increased by KEUR 367 in the first quarter 2010 to KEUR 2,062 (previous year: KEUR 1,697) (+21.5%).
The very good development of results in the first quarter are mainly due to the fact that a number of projects could be invoiced and the share of recurring revenues has increased considerably.
The operative cash flow developed correspondingly well. Compared to the previous year, it in-
creased by KEUR 594 from KEUR 3,047 to KEUR 3,641 (+19.5%). Liquid funds increased compared to the end of the year 2009 by 2.14 million euros in the first quarter and amounted to 13.7 million euros following approx. 11.5 million euros on 31 December 2009.
The "Healthcare Software" segment achieved a result of KEUR 660 in the first three months 2010 following KEUR 341 in the same period of 2009. The "Healthcare Service" segment was also able to close clearly higher than the level of the previous year at KEUR 168 (KEUR 119).
The number of employees increased by 18 compared to the previous year to the current number of 359. The increase in was mainly in the Healthcare Software area.
NEXUS is closing an essential medium break within the hospital information system (HIS) with the new intensive care module. Data from the intensive care ward will also be available in the same interface at the normal ward. This will prevent information gaps between wards and having work done double. This in an innovation, which is being well received in hospitals.
To develop an intensive care module, which is a fixed component and integrated process of the hospital information system (HIS) and covers all specific features of the intensive care ward: NEXUS started the development with this vision two years ago and is putting the module into productive operation in the first hospital this summer. The special feature is the uniform system basis of the intensive care module and the HIS. All treatment information is available everywhere independent of system limits. The hospital and intensive care information systems are a unity both technologically and with respect to the applications and the view of data.
This unity already starts in linking equipment. Thanks to the NE-XUS data concentrator, central linking of equipment of different manufacturers is ensured. However, the application range of the data concentrator not only permits linking equipment at the intensive care ward, but also at the normal ward to the same extent – and with the same user interface. This is a very important aspect, because equipment is increasingly used at normal wards, and these data must be retrievable in the patient files.
Consideration of monitoring data and entry of additional parameters is in a uniform chart. It is the central module of NEXUS / INTENSIVE CARE and at the same time is the central work interface of the nursing solution in NEXUS / HIS. In addition to monitoring data, the patient chart displays all vital parameters, levels of liquids and the medication situation of the patient. As
le embedded to NEXUS /HIS.
We have succeeded with NEXUS / IN-TENSIVE CARE in creating an innovation, which we are convinced will attract a lot of attention on the market. The advantages are convincing: "An intensive care module, which uses all strengths of the HIS module without neglecting the specific requirements of the intensive care ward.". The first introductions have confirmed these product advantages.
a result, the electronic patient chart is the ideal information medium for doctors and nurses both at the intensive care ward and the normal ward.
You must ensure electronically in NEXUS / MEDICATION that this very critical and responsible process is supported free of errors. Prescriptions and on-going changes must be communicated immediately, and they must be unambiguous. Every type of medication, e.g., blood products, one-time prescriptions, continual catheter administration or special enteral tube feeding must be easy to prescribe. In interaction with the patient chart, NEXUS / MEDICATION ensures that the user sees immediately which drugs have been administered and when as well as which ones must be administered in the future. And this is both at the intensive care ward and at the normal ward in the same way. This is an advantage that is not only very significant for legibility and safety, but also with respect to training and introducing a hospital-overlapping medication process.
The price of NEXUS stocks started at approx. € 3.30 at the beginning of the year and remained at this level with a sideways trend until the end of March. Neither the positive reports nor the acquired new orders nor the Ad-Hoc Report about the successful business year 2009 on 22 March could stabilize or increase the price performance sustainably. The price started to drop strongly at the turn of the month March/April until it even fell below € 3.00 in the middle of May. The stock price remains currently at a level around € 3.00. Compared to the perfomance of TecDax-Index, in the same period NEXUS stocks performed slightly better.
| FINANCE SCHEDUlE | |
|---|---|
| General stockholders meeting, Stuttgart (D) | 14. June |
| Half-year Report | 16. August |
| Quarterly Report - third quarter | 08. November |
| German equity forum, Frankfurt (D) | 22. - 24. November |
| EVENT AND TRADE FAIR SCHEDUlE | |
| Deutscher Röntgenkongress, Berlin | 12.-15. May |
| Woche der Pathologie, Berlin | 27.-30. May |
| eHealthcare Kongress, Nottwil (CH) | 22. - 23. September |
| MEDICA & BeraterDialog, Düsseldorf | 17. - 20. November |
| DGPPN, Berlin | 24. - 27. November |
| KTQ-Forum, Berlin | 26. - 27. November |
The director's holders of the Supervisory Board and the Executive Board are as follows on 31 March 2010 in comparison to the previous year:
.
The first quarter was again positive. Sales increases of 8.6% and an increase of the result before taxes of 50.7% are very pleasing news. The same applies to the EBITDA, which is very noteworthy for the first quarter at € 2.1 million. In spite of good increase rates in the previous years, we have been able to maintain this trend and increase our figures continually till now.
Our confidence to continue this development is essentially based on our product program and the acceptance, which we are obtaining from our customers for our products and projects. The orders, which we are winning against the competition, the feedback, which we get from our customers, and the interest of the market in clever solutions: these are the reasons why we believe strongly in our company and our future. As every company with a growth strategy, we are faced with substantial challenges over the next months. We have to complete development projects and conclude challenging customer projects, which are critical for our future development. However, we are ready to do the work necessary and are determined to achieve our goals
| Directors Holdings | Number of | Numbers of |
|---|---|---|
| stocks | options | |
| owned |
| 0 Previous year (0) |
81,099 Prev. year (81,099) |
Dr. jur. Hans-Joachim König |
|---|---|---|
| 0 Previous year (0) |
121,500 Previous year (0) |
Prof. Dr. Alexander Pocsay |
| 0 Previous year (0) |
15,000 Prev.year (15,000) |
Erwin Hauser |
| 0 Previous year (0) |
0 Previous year (0) |
Prof. Dr. Ulrich Krystek |
| 0 Previous year (0) |
0 Previous year (0) |
Dipl.-Betriebswirt (FH) Wolfgang Dörflinger |
| 0 Previous year (0) |
0 Previous year (0) |
Matthias Gaebler |
| Dr. Ingo Behrendt | 112,000 | 149,154 |
|---|---|---|
| (MBA) | Prev.year (112,000) | Prev.year (325,000) |
| Ralf Heilig (MBA) | 129,350 | 0 |
| Prev.year (129,350) | Prev.year (30,000) | |
| Edgar Kuner | 264,051 | 0 |
| (Dipl. Ingenieur) | Prev.year (264,051) | Prev.year (25,000) |
This interim report from the NEXUS Group of 31st March 2010 has been prepared in keeping with the International Financial Reporting Standards (IFRS) as they are applied in the EU. The interpretation of the International Financial Reporting Interpretation Committee (IFRIC) has been taken into account.
The regulations of IAS 34 have been observed in the interim report of 31st March 2010. This refers to a summarized report, which does not contain all information of an IFRS Group Financial Statement, and consequently this report should be read in connection with the Appendix of the Group Financial Statement 2009. The same accounting and valuation methods were used in the Group Financial Statement for the business year 2009.
The report has not been audited.
| Consolidated Profit and Loss Account |
03/31/2010 | 03/31/2009 |
|---|---|---|
| KEUR | KEUR | |
| Revenue | 10,328 | 9,512 |
| Increase/decrease in finished goods and work in progress | 0 | -25 |
| Development work capitalized | 1,014 | 1,012 |
| Other operating income | 312 | 381 |
| Cost of materials including purchased services | 1,734 | 2,131 |
| Personnel costs | 5,609 | 5,221 |
| Depreciation | 1,334 | 1,280 |
| Other operating expenses | 2,248 | 1,831 |
| OPERATING RES ULT |
729 | 417 |
| Revenue from associated companies | 0 | 0 |
| Interest and similar income | 103 | 142 |
| Interest payable and other similar charges | 4 | 10 |
| Result before tax on profit | 828 | 549 |
| Taxes on profit | 160 | 89 |
| Period result | 668 | 460 |
| Actuarial profits and losses (after taxes on profit) | -9 | 4 |
| Differences from the conversion of foreign currency (after taxes on profit) | 6 | -34 |
| Market value changes from assets available for sale (after taxes on profit) | 81 | -56 |
| Other Over all Result | 78 | -86 |
| Over all Result of the Period | 746 | 374 |
| Of the period result, attributed to: | ||
| - Stockholders of NEXUS AG | 628 | 434 |
| - Minority interests | 40 | 26 |
| Of the overall result, attributed to: | ||
| - Stockholders of NEXUS AG - Minority interests |
706 40 |
348 26 |
| Period result per share in EUR | ||
| 13,797 | 13,797 | |
| Weighted average of issued shares in circulation (in thousands) - simple |
0.05 | 0.03 |
| - diluted | 0.05 | 0.03 |
| assets | 03/31/2010 | 12/31/2009 | |
|---|---|---|---|
| KEUR | KEUR | ||
| LONG -TERM ASSETS |
|||
| Goodwill | 11,739 | 11,642 | |
| Other intangible assets | 16,577 | 16,629 | |
| Fixed assets | 1,035 | 1,079 | |
| Shares in affiliated companies | 98 | 98 | |
| Credited deferred taxes | 2,404 | 2,486 | |
| Other financial assets | 88 | 98 | |
| TOTAL OF LONG -TERM ASSETS |
31,941 | 32,032 | |
| SHORT -TERM ASSETS |
|||
| Inventories | 156 | 169 | |
| Trade receivables and other receivables | 14,258 | 12,588 | |
| Receivables from tax on profits | 152 | 350 | |
| Other non-financial assets | 483 | 552 | |
| Other financial assets | 4,592 | 3,558 | |
| Cash and balance in bank | 11,564 | 9,538 | |
| Total of Short-Term Assets | 31,205 | 26,755 | |
| TOTA L ASSETS |
63,146 | 58,787 |
| equity anD liaBilities | 03/31/2010 | 12/31/2009 | |
|---|---|---|---|
| KEUR | KEUR | ||
| CAPITAL AND ACCR UALS |
|||
| Subscribed capital | 13,805 | 13,805 | |
| Capital reserves | 39,523 | 39,523 | |
| Net loss for the year | -5,268 | -5,895 | |
| Other cumulated Group result | -530 | -608 | |
| Own shares | -26 | -26 | |
| EQUITY CAPITAL ATTRIB UTABLE TO STOC KHOLDERS OF THE PARENT COMPANY |
47,504 | 46,799 | |
| Minority interests | 284 | 243 | |
| Total EQUITY | 47,788 | 47,042 | |
| Long-term debts | |||
| Pension obligations | 642 | 610 | |
| Debited deferred taxes | 1,204 | 1,018 | |
| Total of long-term debts | 1,846 | 1,628 | |
| SHORT -TERM DEBTS |
|||
| Accruals | 1,696 | 776 | |
| Financial liabilities | 0 | 290 | |
| Trade accounts payable | 2,497 | 3,515 | |
| Liabilities from tax on profit | 112 | 80 | |
| Deferred revenue liability | 4,284 | 345 | |
| Other non-financial debts | 2,509 | 2,257 | |
| Other financial debts | 2,414 | 2,854 | |
| Total of Short-Term Debts | 13,512 | 10,117 | |
| Total assets | 63,146 | 58,787 |
| CONSOLIDATED CAS H FLOW STATEMENT |
2010 | 2009 |
|---|---|---|
| 1. Cash Flow from Current Business Transactions |
KEUR | KEUR |
| Results of the year before deduction of profit payable to other companies and taxes on profit | 828 | 549 |
| Depreciation and amortization of intangible assets and plant, equipment and other fixed assets | 1,334 | 1,280 |
| Other expenses/income with no impact on cash | 1 | -113 |
| Increase/decrease in inventories | 13 | -143 |
| Profit/loss from loss of assets | 0 | 0 |
| Profit/loss from disposal of securities | 0 | 18 |
| Increase/decrease in trade receivables and other assets that cannot be allocated to investing or financing activities |
-2,631 | -2,744 |
| Increases and decreases of accruals insofar as not entered in equity capital | 603 | 497 |
| Increase/decrease in trade receivables and other liabilities that cannot be allocated to investing or financing activities |
3,185 | 3,429 |
| Paid interest | -10 | -4 |
| Received interest | 119 | 113 |
| Income taxes paid | -1 | -61 |
| Income taxes received | 194 | 232 |
| 3,641 | 3,047 | |
| 2. Cash Flow from Investment Activities |
||
| Cash paid for investments in intangible and fixed assets | -1,324 | -1,309 |
| Cash paid for investments in financial assets | 0 | 0 |
| Cash received from disposal of fixed assets | 0 | 0 |
| Cash received from purchase price adjustments at subsidiaries | 0 | 0 |
| Purchase of companies after deduction of acquired payment means | 0 | 0 |
| Cash received disposal of securities | 0 | 1,281 |
| Cash paid for investments in securities | 0 | 0 |
| -1,324 | -28 | |
| 3. Cash Flow from Financing Activities |
||
| Dividends paid to minority shareholders | 0 | 0 |
| Payments into equity capital via exercise of stock options | 0 | 0 |
| Purchase of own shares | 0 | 0 |
| Payments for taking loans within the context of short-term payment disposal | 0 | 0 |
| Amount paid out for redeeming loans | -290 | -83 |
| -290 | -83 | |
| 4. Amount of cash and cash equivalents at end of period | ||
| Cash relevant changes in cash and cash equivalents (sum of 1 + 2 + 3) | 2,027 | 2,936 |
| Change in currency conversion adjustment | -1 | 33 |
| Consolidation circle-conditional change of financial funds | 0 | 0 |
| Cash and cash equivalents at beginning of fiscal year | 9,538 | 4,141 |
| 11,564 | 7,110 | |
| 5. Composition of cash and cash equivalents | ||
| Cash on hand | 11,564 | 7,138 |
| Bank liabilities due on demand | 0 | -28 |
| 11,564 | 7,110 |
| Group Equity Ch ange Statement |
capital ubscribed S KEUR |
reserves apital C KEUR |
provisions ther O KEUR |
from conversion diference curency quity E KEUR |
financial nstruments for eserve R I KEUR |
pensions for eserve R KEUR |
loss forward onsolidated carry C KEUR |
profit onsolidated deficit / C KEUR |
hares wn S O KEUR |
to company attributable parent cap , of stockh, quity E KEUR |
interest inority M KEUR |
equity otal T KEUR |
capital ed uthoriz A KEUR |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Consolidated equity as of 12/31/2008 |
13,805 | 39,483 | 0 | 59 | -999 | -72 | -9,503 | 1,488 | -26 | 44,235 | 259 | 44,494 | 6,860 |
| Transfer of 2008 consolidated loss to consolidated loss carry-forward |
1,488 | -1,488 | 0 | 0 | |||||||||
| Total of the result entered directly into equity capital |
-34 | -56 | 4 | -86 | -86 | ||||||||
| Profit before tax 03/31/2009 | 434 | 434 | 26 | 460 | |||||||||
| Overall Result of the Period |
0 | 0 | 0 | -34 | -56 | 4 | 0 | 434 | 348 | 26 | 374 | ||
| Stock-based payment | 14 | 14 | 14 | ||||||||||
| Consolidated equity as of 03/31/2009 |
13,805 | 39,497 | 0 | 25 | 1,055 | -68 | -8,015 | 434 | -26 | 44,597 | 285 | 44,882 | 6,860 |
| Consolidated equity as of 12/31/2009 |
13,805 | 39,523 | 0 | 59 | -558 | -109 | -8,016 | 2,119 | -26 | 46,799 | 243 | 47,042 | 6,860 |
| Profit before tax 2009 entered directly in accumulated deficit |
2,119 | -2,119 | 0 | 0 | |||||||||
| Total of the result entered directly into equity capital |
6 | 81 | -9 | 78 | 78 | ||||||||
| Profit before tax 03/31/2010 | 628 | 628 | 40 | 668 | |||||||||
| Overall Result of the Period |
0 | 0 | 0 | 6 | 81 | -9 | 0 | 628 | 706 | 40 | 746 | ||
| Stock-based payment | 0 | 0 | |||||||||||
| Consolidated equity as of 03/31/2010 |
13,805 | 39,523 | 0 | 65 | -477 | -118 | -5,897 | 628 | -26 | 47,505 | 283 | 47,788 | 6,860 |
13
To the best of our knowledge, and in accordance with the applicable reporting principles for interim financial reporting, the interim consolidated financial statements give a true and fair view ot the assets, liabilities, financial position and profit or loss of the group, and the interim management report of the group includes a fair review of the development and performance of the business and the position of the group, together with a description ot the principal opportunities and risks associated with the expected development of the group for the remaining months of the financial year.
Villingen-Schwenningen, May 17th, 2010
NEXUS AG Executive Board
NEXUS AG, Auf der Steig 6, D-78052 Villingen-Schwenningen Telefon +49 (0)7721 8482 -0, Fax +49 (0)7721 8482-888 www.nexus-ag.de, [email protected]
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