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Analysts think Craneware PLC could be at the start of an ‘upgrade cycle’, after the firm on Tuesday delivered full-year results ahead of expectations. In the financial year to June 30, pretax profit increased 20% to $15.7 million from $13.1 million a year prior. Adjusted earnings before interest, taxes, depreciation and amortisation rose 6.2% to $58.3 million from $54.9 million, ahead of previous guidance of $58 million. Revenue rose 8.8% to $189.3 million from $174.0 million, compared with previous guidance of at least $188 million. Annual recurring revenue increased 1.8% to $172.0 million from $169.0 million. Basic earnings per share climbed 27% to 33.5 US cents from 26.3 cents before, as did diluted EPS to 33.2 cents from 26.1 cents. The Edinburgh, Scotland-based provider of software solutions said the results reflected investments made over recent years coming to fruition, and demonstrated the strength of the Trisus platform. Trisus is a cloud-based platform that collates data for healthcare providers as well as providing a number of analytical tools. Chief Executive Keith Neilson expressed confidence in achieving another ‘positive year ahead’. ‘Momentum has continued post-year end, with good levels of trading and customer confidence, providing the board with confidence in continued growth momentum for [financial 2025], delivering on current expectations and the sustainable return to double digit growth rates,’ the company said in a statement. An unchanged final dividend of 16.0 pence per share meant the total payout was raised by 1.8% to 29.0p from 28.5p. In response, shares in Craneware jumped 7.5% to 2,226.00 pence in London on Tuesday. Berenberg said the results demonstrated improving operational momentum, as the firm nears a return to double-digit growth. Revenue was slightly better than previously disclosed, with second half growth of 9.7%. Third-party partner revenue saw particularly strong growth to $13.8 million from $1.1 million a year prior, the broker observed. Berenberg notes Craneware trades on 24.7 times financial 2025 PE. The broker thinks this is a ‘highly attractive valuation for a best-in-class software offering that continues to demonstrate incremental improvements across its product offering and distribution capabilities, and, in our view, will keep doing so.’ Peel Hunt said having talked to management, and taking account of commentary from other peers in the US healthtech space, it is ‘for the first time in a while pushing through some small upgrades to revenue’. ‘We think we are at the start of an upgrade cycle similar to the mid-2010s’, the broker commented. Both Peel Hunt and Berenberg have a ’buy’ rating on Craneware. Copyright 2024 Alliance News Ltd. All Rights Reserved.
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