Strong Aussie dollar hits iSoft results

GFC spurs slowdown in public sector health spending

Despite a strong global health IT market, iSOFT has recorded declines across its revenues, after tax profits and EBITDA for the half year to 31 December 2009.

The company recorded revenue of $237.3 million; down 1 per cent year on year. EBITDA of $40.8m; down 27 per cent over the same period and net profit after tax of $4.8m, down 27 per cent.

According to CEO Gary Cohen, the global health IT industry remained strong, however the high Australian dollar had had a large impact on the first half results.

“Notwithstanding the currency effect, we are seeing growth in our core businesses, we are meeting important milestones in the rollout of our Lorenzo solution in the UK and we are continuing to invest in world class solutions as significant opportunities emerge in markets such as the US, Europe and Latin America,” he said in an ASX statement.

The company added that markets in Australia, the Middle East, Africa and Asia, which represented about 17 per cent of Group revenue, had felt the effects of a slow down in public sector IT spending amid the global financial crisis.

“There are encouraging signs of a recovery in some parts of the market, particularly in Australia where the government is making progress on its agenda of healthcare reform, including a commitment to e-Health,” the ASX statement reads.

The company said it expected a full year 2009 revenue of $470 million and EBITDA of $113 million.

In FY2010 it expected revenue growth of six to 10 per cent and a EBITDA margin of 21-23 per cent.

In January the UK Financial Services Authority announced it had launched fraud proceedings against four former directors of iSOFT Group.

In December iSOFT announced it was restructuring its senior secured debt facility in an effort to garner more flexibility in managing its global footprint.

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