REG - Induction Healthcare - Post-period end Trading Update

Induction HealthcareAnnouncement

21/04/2022 07:00

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RNS Number : 8209I  Induction Healthcare Group PLC   21 April 2022

Induction Healthcare Group PLC

("Induction", the "Company", or the "Group")

 

Post-period end Trading Update

 

Very significant FY 2022 growth in-line with market expectations

Strong cash position and breakeven at the adjusted EBITDA level

Growing Annual Recurring Revenue stream and investment plan for future growth

 

Induction (AIM: INHC), a leading digital health platform driving
transformation of healthcare systems worldwide, provides an update on
continued strong trading and outlook following the year ended 31 March 2022
("FY22").

 

Following on from other recent positive announcements, Induction has seen a very strong finish to trading for FY22.  Contracted annual recurring revenues ("ARR"), a key metric for the business, has grown significantly to c. £15m (31 March 21: £1.8m). Results for FY22 are in-line with already upgraded market expectations for revenue and adjusted EBITDA (£12m and breakeven, respectively) (31 March 21: £1.5m and £-4.8m). In addition, following the placing to raise £25m in June 2021,  net cash as at 31 March 2022 was inline with expectations at c. £8m (31 March 21: £2.4m). Furthermore, following strong renewals of NHS England Induction Attend Anywhere ("AA") contracts, the Group's cash position has further increased significantly, post period end.

 

FY22 has been a transformational year for Induction following the acquisition
and successful integration of AA. Induction has consolidated its leading
position within secondary care across the British Isles, and has established a
business with strong and growing ARR. As per recent announcements, the
contract renewals for video consultation services across NHS England, NHS
Scotland and the Scottish Government, as well as the contract renewal for AA
in Wales earlier in FY22, have validated the Board's decision to make the AA
acquisition. Notably it has delivered a strong base of recurring revenues with
the majority of contracts moving to multi-year deals.

 

The contract win with the Department of Work and Pensions, announced in
November, also confirms the adaptability of Induction's solutions and how they
can be applied beyond a healthcare setting. There is significant potential to
grow revenues further from AA across non-NHS services throughout the British
Isles and to replicate the success of the platform, within both healthcare and
non-healthcare settings, in other global jurisdictions.

 

Induction Zesty ("Zesty"), a digital patient portal that allows patients to
book and manage their hospital appointments, view their letters and clinical
records and provide data remotely, has also seen a dramatic increase in ARR
during the period, up c. 100% year-on-year.

 

The strong FY22 performance provides Induction with a robust base on which to
further expand total contracted ARR, and hence recognised revenues, into FY23
and FY24 respectively.  In addition to the noted opportunities to expand ARR
from AA, the Board believes there is an opportunity to significantly increase
the adoption of Zesty ahead of original expectations.  This is supported by
on-going nationally funded NHS programmes to ensure that every NHS acute trust
has in place, or is in the process of implementing, a patient portal within
this financial year. With an established market presence, and through
strategic collaborations with third-parties such as the Cerner Corporation
(NASDAQ: CERN), Induction is in a leading position to roll-out Zesty as part
of an integrated solution supporting this Government-led drive for digital
transformation.

 

To take advantage of this major opportunity, Induction will utilise its strong
cash generation to invest above current expectations in development, delivery
and commercial resources. This will not only underpin and de-risk FY23 growth
forecasts, but also accelerate both contracted ARR and recognised revenue
growth into FY24 and beyond. With the strong cash position that Induction now
enjoys, this investment ahead of growth can be made at the same time as
ensuring there is sufficient working capital within the business to get it to
a cashflow positive position in FY24.

 

 

Induction CEO, James Balmain, said: "We are delighted that our FY22
performance has shown such considerable growth in-line with market
expectations which had already been upgraded during the year. Annual recurring
revenues - a key measure of our ongoing success - have continued to grow and,
with the recent AA NHS England renewals in particular, we have generated more
cash post-period end than expected. Looking forward we see the scale of the
opportunity for Induction Zesty has materially increased in recent months.
We will use the extra cash that has been generated to accelerate investment
into our product development and delivery capability, where we expect to see
further growth in high quality, stable revenues as the push for the digital
transformation of the NHS continues. We're very excited about the future
prospects of this business."

 

Investor Briefing

James Balmain, Chief Executive Officer and Guy Mitchell, Chief Financial
Officer will be hosting a live online presentation relating to the Trading
Update via the Investor Meet Company platform at 16:30 BST on Thursday 12 May.
The presentation is open to all existing and potential shareholders.

 

Investors can sign up to Investor Meet Company for free and register for the
presentation here:
https://www.investormeetcompany.com/induction-healthcare-group-plc/register-investor
(https://www.investormeetcompany.com/induction-healthcare-group-plc/register-investor)
 

 

Investors who already follow Induction on the Investor Meet Company platform
will automatically be invited.

 

-ENDS-

 

 

 

ENQUIRIES

 

 Induction                                              Via Walbrook PR Ltd: induction@walbrookpr.com

                                                      (mailto:induction@walbrookpr.com)
 James Balmain, Chief Executive Officer
 Guy Mitchell, Chief Financial Officer

 Singer Capital Markets (Nominated Adviser and Broker)  +44 (0) 20 7496 3000
 Philip Davies / Kailey Aliyar

 Walbrook PR Ltd                                        +44 (0)20 7933 8780
 Alice Woodings / Stephanie Cuthbert

 

 

About Induction -  www.inductionhealthcare.com
(http://www.inductionhealthcare.com)

 

Induction (AIM: INHC) Induction delivers a suite of software solutions through
a single integrated platform that transform care delivery. Our system-wide
applications help healthcare providers and administrators to deliver care at
any stage remotely as well as face-to-face - giving the communities they serve
greater flexibility, control and ease of access. Purpose-built for integration
with leading Electronic Medical Record (EMR) platforms, our products offer
immediate stand-alone value that becomes even greater when integrated with
pre-existing systems.

 

Used at scale by national and regional healthcare systems, as well non-health
government services, our applications are relied upon by hundreds of thousands
of clinicians and millions of patients across almost every hospital in the
British Isles.

 

 

 

 

 

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