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CompuGroup Medical SE
Germany | Technology | MCap EUR 3,501m
10 May 2021 UPDATE
Reaction to Q1 results BUY (HOLD)
overdone – PT up; Target price
Current price
Up/downside
EUR 72.00 (70.00)
EUR 65.15
10.5%
Upgrade to BUY
What’s it all about?
CompuGroup reported a mixed start to 2021, with Q1 revenues supported by organic
and inorganic growth. In the conference call, all eyes were on margins as well as capital
expenditure, which is assumed to be in the range of EUR 70m – EUR 80m in FY 2021.
Current market expectations of declining margins are not reasonable from our
perspective. To the contrary: expected synergies from recent acquisitions plus the
company’s additional investments to tap digitization opportunities in the healthcare
sector should drive organic growth and attractive EBITDA margins going forward.
Group targets are completely in line with our initial expectations (see start coverage on
research-hub.de). We maintain our view on CGM and updated our CAPEX assumptions MAIN AUTHOR
after a discussion with the company (eAR: EUR 73m in 2021). As a result of lower Thomas Wissler
CAPEX assumptions, we slightly increased our DCF-based price target to EUR 72.00 t.wissler@alsterresearch.com
(EUR 70.00) and changed our recommendation from HOLD to BUY. Upside potential +49 40 309 293-58
stands at 11%. BUY on unjustified share price weakness.
IMPORTANT. Please refer to the last page of this report for “Important disclosures” alsterresearch.com
and analyst(s) certifications. This research is the product of AlsterResearch, which is authorized
and regulated by the BaFin in Germany.
AlsterResearch
Page 2 of 16
CompuGroup Medical SE
Germany | Technology | MCap EUR 3,501m | EV EUR 4,022m
Target price EUR 72.00 (70.00) MAIN AUTHOR
BUY (HOLD) Thomas Wissler
Current price EUR 65.15
Up/downside 10.5% t.wissler@alsterresearch.com
+49 40 309 293-58
Reaction overdone – PT up; HOLD to BUY
Won a large order for clinical suite solutions
CompuGroup reported healthy Q1 2021 results, helped by the rising digital demand in
healthcare. In addition to two acquisitions in the US in late 2020, management plans
to enhance its market position in France through the acquisition of Atalanta Group, a
leader in the field of physicians information systems, which is expected to be
complete by Q2 2021. Moreover, the company is scheduled to initiate a four-year
project in cooperation with Universitätsklinikum Hamburg-Eppendorf (UKE), a leading
university clinic in Europe, in May 2021. Source: Company data, AlsterResearch
Steady organic improvement along with strong inorganic growth High/low 52 weeks 85.40 / 59.40
Q1 revenues rose a solid 25% yoy to EUR 228.9m, with recurring revenue share rising Price/Book Ratio 5.3x
to 69% (vs 59% in Q4 2020 and 67% in Q1 2020), but were below analysts’ consensus
expectations. The yoy growth in revenues was largely driven by contributions from Ticker / Symbols
recent acquisitions, in addition to an organic (organic) growth of 4.9% yoy (Q4: +4.9% ISIN DE000A288904
yoy), driven by one-off revenues from the Telematics Infrastructure (TI) rollout to WKN A28890
pharmacies. Excluding TI, organic revenues grew a muted 1.5% yoy. Bloomberg COP:GR
HIS and CHS were the major organic growth drivers Changes in estimates
By segment, Hospital Information System (HIS) witnessed strong growth in revenues Sales EBIT EPS
(+64% yoy to EUR 55.1m), mainly aided by Cerner’s healthcare portfolio acquisition, 2021 old 00.0 00.0 00.0
∆ – – –
and an 8% yoy organic growth led by healthy German clinic business development.
2022 old 00.0 00.0 00.0
Consumer & Health Management Information System (CHS) revenues also increased ∆ – – –
33% yoy to EUR 33.7m, boosted by organic strength (+34% yoy), largely driven by the 2023 old 00.0 00.0 00.0
roll-out of TI, excluding which organic growth came in at 9% yoy. Moreover, ∆ – – –
Ambulatory Information System (AIS) revenues grew 18% yoy to EUR 112.2m (yet -1%
yoy organic), primarily supported by contributions from recently acquired eMDs in the Key share data
US. In contrast, Pharmacy Information System (PIS) revenues declined 3% yoy to EUR Number of shares: (in m pcs) 54
27.9m as the base quarter benefited from the launch of Windows 10. Book value per share: (in €) 12.20
Ø trading volume: (12 months) 85,000
- continued -
CompuGroup Major shareholders
2018 2019 2020 2021E 2022E 2023E
Medical SE Frank Gotthardt - Management 6.8%
Sales 717 746 837 1,015 1,084 1,122 GT1 Vermögensverwaltung 26.5%
Growth yoy 23.1% 4.0% 12.3% 21.2% 6.8% 3.5% Prof. Dr. Daniel Gotthardt 6.7%
EBITDA 188 178 197 222 238 253
Free Float 50.0%
EBIT 143 115 122 154 165 179
Net profit 96 66 73 97 104 112 Company description
Net debt (net cash) 308 464 477 385 300 193 CompuGroup is a software developer,
Net debt/EBITDA 1.6x 2.6x 2.4x 1.7x 1.3x 0.8x
focusing on software solutions to the
EPS recurring 1.94 1.35 1.40 1.80 1.93 2.09
healthcare industry, including
DPS 0.50 0.50 0.50 0.60 0.60 0.60
Dividend yield 0.8% 0.8% 0.8% 0.9% 0.9% 0.9%
physicians, pharmacies, health
Gross profit margin 81.5% 84.7% 85.2% 83.9% 83.9% 83.9% insurances, laboratories, hospitals and
EBITDA margin 26.2% 23.9% 23.6% 21.9% 22.0% 22.6% rehabilitation and care facilities. Its
EBIT margin 20.0% 15.5% 14.5% 15.2% 15.2% 16.0% activities are divided into Ambulatory
ROCE 21.3% 13.0% 9.1% 11.0% 11.1% 11.8% Information Systems (AIS), Pharmacy
EV/EBITDA 20.4x 22.4x 20.4x 17.7x 16.2x 14.8x Information Systems (PCS), Hospital
EV/EBIT 26.8x 34.7x 33.0x 25.5x 23.3x 20.9x Information Systems (HIS) and
PER 33.4x 48.2x 46.6x 36.2x 33.7x 31.2x Consumer and Health Management
FCF yield 3.9% 2.6% 3.5% 4.8% 4.1% 4.8% Information Systems (CHS).
Source: Company data, Alster Research
AlsterResearch Page 3 of 16 Ongoing growth investments pressured margins Consolidated adjusted EBITDA rose 7% yoy to EUR 46.5m (below analysts’ consensus estimate); however, the margin contracted 4ppt yoy to 20% owing to announced future growth investments. By segment, adjusted EBITDA margins deteriorated in AIS (-3ppt yoy to 26%), CHS (-4ppt yoy to 15%) and PIS (-2ppt yoy to 29%), while improved a marginal 1ppt yoy in HIS to 14%. Despite higher EBITDA line, adjusted EPS fell 3% yoy to EUR 0.33 on higher depreciation. Completed share buyback plan amid strong cash flow Healthy cash generation from operations (on better working capital management) resulted in a 38% yoy increase in FCF to EUR 70.4m. Moreover, the company completed its recently increased (doubled) share repurchase programme of 1m (ca 1.9% of total share capital) for EUR 71.3m over 25 February to 29 April 2021 (EUR 43.3m in Q1). Given the strong FCF, net leverage remained stable at 2.0x (vs end- 2020), despite share buybacks. Conclusion CompuGroup reported a mixed start to 2021, with Q1 revenues supported by organic and inorganic growth. For 2021, the group confirmed its target on sales of EUR 1bn – EUR 1.04bn (organic growth: 4% – 8% yoy), with all its segments guided to report higher revenue growth (at the midpoint). It expects an adjusted EBITDA of EUR 210m – EUR 230m (margin: 21% – 22%), an adjusted EPS of EUR 1.70 – EUR 1.95, capital expenditure of EUR 70m – EUR 80m and FCF of over EUR 80m. These targets are completely in line with our initial expectations (see Initiation note from February 2 on research-hub.de), and therefore, we clearly confirm our view on CompuGroup. In addition to expected synergies from its recent acquisitions, the company’s additional investments to tap digitization opportunities in the healthcare sector should drive organic growth and attractive EBITDA margins going forward. Current market expectations of declining margins are not reasonable from our perspective. To the contrary: expected synergies from recent acquisitions plus the company’s additional investments to tap digitization opportunities in the healthcare sector should drive organic growth and attractive EBITDA margins going forward. We maintain our view on CGM and updated our CAPEX assumptions after a discussion with the company (eAR: EUR 73m in 2021). As a result of lower CAPEX assumptions, we slightly increased our DCF-based price target to EUR 72.00 (EUR 70.00) and changed our recommendation from HOLD to BUY. Upside potential stands at 11%. BUY on unjustified share price weakness. Quarterly table P&L data Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Sales 186.6 177.9 206.1 183.0 179.9 231.3 242.9 228.9 yoy growth in % -2.1% 7.3% 6.0% 4.4% -3.6% 30.0% 17.9% 25.1% Gross profit 148.0 150.0 163.0 151.0 150.0 191.0 189.0 187.5 Gross margin in % 79.3% 84.3% 79.1% 82.5% 83.4% 82.6% 77.8% 81.9% EBITDA 37.0 43.0 52.0 40.0 43.0 66.0 48.0 44.4 EBITDA margin in % 19.8% 24.2% 25.2% 21.9% 23.9% 28.5% 19.8% 19.4% EBIT 22.6 28.5 33.4 23.3 26.0 48.1 25.0 17.5 EBIT margin in % 12.1% 16.0% 16.2% 12.7% 14.5% 20.8% 10.3% 7.7% EBT 20.3 27.2 31.0 18.8 23.2 49.3 19.0 16.1 taxes paid 6.1 9.1 17.6 6.0 7.0 14.5 9.6 5.1 tax rate in % 30.1% 33.5% 56.7% 31.8% 30.0% 29.3% 50.5% 31.6% net profit 14.0 18.1 13.4 12.7 16.3 34.8 9.4 11.0 yoy growth in % -44.6% 6.4% -60.8% -37.8% 16.8% 92.5% -29.8% -13.5% EPS 0.29 0.37 0.29 0.26 0.34 0.69 0.15 0.20 Source: Company data; AlsterResearch
AlsterResearch
Page 4 of 16
Investment case in six charts
Operating segments Sales by segments
Ambulatory
Information
Systems Pharmacy
45% Information
Systems
14%
Consumer &
Health Hospital
Management Information
Information Systems
Systems 22%
19%
Recurring revenues increase visibility Market trends
Shareholder structure Customers and locations
Dr Reinhard Koop
Dr Brigitte
4%
Gotthardt
6%
Prof Dr Daniel
Gotthardt
7%
Frank Gotthardt
7%
Free Float
50%
GT1 Vermögens-
verwaltung GmbH
26%
Source: Company data; AlsterResearchAlsterResearch
Page 5 of 16
SWOT - Analysis
Strengths
● Around 90% of the business is protected by high barriers to entry
● High share of recurring revenues (60%), indicating defensive strengths
● Great track record on acquisitions
● Founding family continues to control the business
Weaknesses
● Low, albeit fairly secure, underlying growth
● Wage inflation at the level of underlying growth
● Dependence on increasing regulation for attractive growth rates
● Higher level of goodwill after recent acquisitions
Opportunities
● Consumerisation of healthcare
● Increasing digitalisation of healthcare
● Market share gains based on Telematics Infrastructure (TI) roll-out
● Ongoing industry consolidation based on growing regulatory
requirements
Threats
● Loss of political support for healthcare digitalisation
● Consolidation of pharmacies and hospitals
● Regulation allowing open-source, interoperable software
● Overpaying for, or mishandling, M&A dealsAlsterResearch Page 6 of 16 Company background CompuGroup Medical is a listed software company and an international provider of software for the healthcare sector. It produces application software to support medical and organisational activities in medical practices, pharmacies, medical laboratories and hospitals. The company’s vision is to simplify the recording of data and treatment paths, electronic billing and better the organization of practice. CompuGroup Medical provides vital software to improve health and quality of life. The company builds bridges between doctors, pharmacists, payers, laboratories, rehabilitation and care facilities as well as hospitals, helping them to provide people with optimal care. CompuGroup Medical operates in four segments: Ambulatory Information Systems, Pharmacy Information Systems, Hospital Information Systems and Consumer & Health Management Information Systems. The Group has several locations in 18 countries providing its products and services in nearly 60 countries worldwide. CompuGroup Medical Source: Company data, AlsterResearch AG
AlsterResearch
Page 7 of 16
Valuation
The DCF model results in a price target of EUR 72.00 per share. Key model
assumptions:
• Top-line growth: We expect CompuGroup to continue benefitting from
structural growth and digitalization in the Health Care sector. Hence our
growth estimates for 2021-28E is in the range of 4% p.a.
• The long-term growth rate is set at 2.0%.
• EBIT margins. The scalable business model should allow for EBIT margins
of above 16% by 2023E, which look defendable given high competitive
quality. Accordingly, we model approx. 18% EBIT margins in the long-term.
• WACC. We model a weighted average cost of capital of 5.0% to reflect the
mature stage of the business model as well as a high share of recurring
revenues. A 5.0% risk premium, a beta of 0.7x and a 2.0% risk free rate are
modelled.
DCF (EUR m) Terminal
2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E
(except per share data and beta) value
NOPAT 129 137 146 169 182 188 192 198
Depreciation 32 36 35 31 28 27 26 25
Change in working capital 19 -20 -0 -8 -0 3 -5 -2
Chg. in long-term provisions 8 10 6 13 5 2 7 7
Capex -73 -51 -53 -51 -53 -55 -57 -59
Cash flow 115 113 134 154 162 165 163 170 5,001
Present value 111 103 117 126 126 122 114 113 3,328
WACC 5.5% 5.5% 5.5% 5.5% 5.5% 5.5% 5.5% 5.5% 5.5%
DCF per share derived from DCF avg. growth and earnings assumptions
Planning horizon avg. revenue growth (2021E - 2028E) 4.0%
Total present value 4,260 Terminal value growth (2028E - infinity) 2.0%
Mid-year adj. total present value 4,376 Terminal year ROCE 11.8%
Net debt / cash at start of year 477 Terminal year WACC 5.5%
Financial assets 33
Provisions and off b/s debt 44 Terminal WACC derived from
Equity value 3,888 Cost of borrowing (before taxes) 5.0%
No. of shares outstanding 53.7 Long-term tax rate 30%
Equity beta 0.61
Discounted cash flow per share 72.36 Unlevered beta (industry or company) 0.69
upside/(downside) 11.1% Target debt / equity 0.1
Relevered beta 0.69
Risk-free rate 2.0%
Equity risk premium 5.0%
Share price 65.15 Cost of equity 5.5%
Sensitivity analysis DCF
Long term growth Share of present value
73,1 1.0% 1.5% 2.0% 2.5% 3.0%
Change in WACC
2.0% 37.1 39.8 42.9 46.6 51.2 2021E - 2024E 10.7%
(%-points)
1.0% 45.5 49.5 54.3 60.4 68.2 2025E - 2028E 11.1%
0.0% 57.7 64.1 72.4 83.4 99.0 terminal value 78.1%
-1.0% 76.8 88.5 105.0 129.8 171.5
-2.0% 111.5 137.8 182.0 271.6 550.7
Source: AlsterResearchAlsterResearch
Page 8 of 16
Due to the fact that companies rarely bear sufficient resemblance to peers in terms
of geographical exposure, size or competitive strength and in order to adjust for the
pitfalls of weak long-term visibility, an Adjusted Free Cash Flow analysis (Adjusted
FCF) has been conducted.
The adjusted Free Cash Flow Yield results in a fair value between EUR 41.00 per
share based on 2021E and EUR 67.00 per share on 2025E estimates.
The main driver of this model is the level of return available to a controlling investor,
influenced by the cost of that investors’ capital (opportunity costs) and the purchase
price – in this case the enterprise value of the company. Here, the adjusted FCF yield
is used as a proxy for the required return and is defined as EBITDA less minority
interest, taxes and investments required to maintain existing assets (maintenance
capex).
FCF yield in EURm 2021E 2022E 2023E 2024E 2025E
EBITDA 222 238 253 272 288
- Maintenance capex 22 25 25 22 20
- Minorities -0 -1 -0 -1 -1
- tax expenses 46 49 55 58 63
= Adjusted Free Cash Flow 154 164 173 193 205
Actual Market Cap 3,460 3,460 3,460 3,460 3,460
+ Net debt (cash) 385 300 193 67 -58
+ Pension provisions 43 46 48 52 54
+ Off b/s financing 0 0 0 0 0
- Financial assets 33 33 33 33 33
- Acc. dividend payments 26 58 91 123 163
EV Reconciliations 369 255 117 -37 -200
= Actual EV' 3,829 3,715 3,577 3,423 3,260
Adjusted FCF yield 4.0% 4.4% 4.8% 5.6% 6.3%
base hurdle rate 6.0% 6.0% 6.0% 6.0% 6.0%
ESG adjustment 0.0% 0.0% 0.0% 0.0% 0.0%
adjusted hurdle rate 6.0% 6.0% 6.0% 6.0% 6.0%
Fair EV 2,568 2,737 2,888 3,222 3,422
- EV Reconciliations 369 255 117 -37 -200
Fair Market Cap 2,200 2,483 2,771 3,259 3,622
No. of shares (million) 54 54 54 54 54
Fair value / share in EUR 40.94 46.20 51.58 60.65 67.41
Premium (-) / discount (+) -36.4% -28.3% -19.9% -5.8% 4.7%
Sensitivity analysis fair value
4.0% 65 72 78 91 99
5.0% 50 56 62 73 80
Adjusted
6.0% 41 46 52 61 67
hurdle rate
7.0% 34 39 44 52 58
8.0% 29 33 38 46 51
Source: AlsterResearch
Simply put, the model assumes that investors require companies to generate a
minimum return on the investor’s purchase price. The required after-tax return
equals the model’s hurdle rate of 6%. Anything less suggests the stock is expensive;
anything more suggests the stock is cheap. ESG adjustments might be applicable,
based on the overall Leeway ESG Score. A high score indicates high awareness for
environmental, social or governance issues and thus might lower the overall risk
an investment in the company might carry. A low score on the contrary might
increase the risk of an investment and might therefore trigger a higher required
hurdle rate.AlsterResearch
Page 9 of 16
Financials in six charts
Sales vs. EBITDA margin development EPS, DPS in EUR & yoy EPS growth
1.200 27% 2,50 250%
26%
1.000 200%
2,00
25%
800 150%
24%
1,50
600 23% 100%
22% 1,00
400 50%
21%
200 0,50
20% 0%
0 19% 0,00 -50%
17 18 19 20 21E 22E 23E 17 18 19 20 21E 22E 23E
Sales (€m) EBITDA margin (%) EPS DPS EPS growth
ROCE vs. WACC (pre tax) Net debt and net debt/EBITDA
25% 600 3,00x
20% 500 2,50x
400 2,00x
15%
300 1,50x
10%
200 1,00x
5%
100 0,50x
0% 0 0,00x
17 18 19 20 21E 22E 23E 17 18 19 20 21E 22E 23E
ROCE WACC pre tax Net debt (€m) Net debt / EBITDA (x)
Capex & chgn in w/c requirements in EURm Free Cash Flow in EURm
90 120
80
100
70
60
80
50
40 60
30
40
20
10
20
0
17 18 19 20 21E 22E 23E
0
Capex Change in w/c
17 18 19 20 21E 22E 23E
Source: Company data; AlsterResearchAlsterResearch Page 10 of 16 Financials Profit and loss (EUR m) 2018 2019 2020 2021E 2022E 2023E Net sales 717 746 837 1,015 1,084 1,122 Sales growth 23.1% 4.0% 12.3% 21.2% 6.8% 3.5% Change in finished goods and work-in-process 19 25 32 24 26 26 Total sales 736 770 869 1,039 1,109 1,148 Material expenses 151 139 156 188 200 208 Gross profit 584 631 713 851 909 941 Other operating income 8 13 11 10 11 11 Personnel expenses 281 339 377 446 477 494 Other operating expenses 123 127 149 193 205 205 EBITDA 188 178 197 222 238 253 Depreciation 11 29 31 32 36 35 EBITA 176 150 167 190 202 218 Amortisation of goodwill and intangible assets 33 34 45 35 37 38 EBIT 143 115 122 154 165 179 Financial result -9 -8 -11 -11 -11 -11 Recurring pretax income from continuing operations 134 108 110 143 154 168 Extraordinary income/loss 0 0 0 0 0 0 Earnings before taxes 134 108 110 143 154 168 Taxes 38 42 37 46 49 55 Net income from continuing operations 96 66 73 97 104 113 Result from discontinued operations (net of tax) 0 0 0 0 0 0 Net income 96 66 73 97 104 113 Minority interest -0 -0 -0 -0 -1 -0 Net profit (reported) 96 66 73 97 104 112 Average number of shares 49.21 48.70 52.37 53.73 53.73 53.73 EPS reported 1.94 1.35 1.40 1.80 1.93 2.09 Profit and loss (common size) 2018 2019 2020 2021E 2022E 2023E Net sales 100% 100% 100% 100% 100% 100% Change in finished goods and work-in-process 3% 3% 4% 2% 2% 2% Total sales 103% 103% 104% 102% 102% 102% Material expenses 21% 19% 19% 19% 19% 18% Gross profit 81% 85% 85% 84% 84% 84% Other operating income 1% 2% 1% 1% 1% 1% Personnel expenses 39% 46% 45% 44% 44% 44% Other operating expenses 17% 17% 18% 19% 19% 18% EBITDA 26% 24% 24% 22% 22% 23% Depreciation 2% 4% 4% 3% 3% 3% EBITA 25% 20% 20% 19% 19% 19% Amortisation of goodwill and intangible assets 5% 5% 5% 3% 3% 3% EBIT 20% 15% 15% 15% 15% 16% Financial result -1% -1% -1% -1% -1% -1% Recurring pretax income from continuing operations 19% 14% 13% 14% 14% 15% Extraordinary income/loss 0% 0% 0% 0% 0% 0% Earnings before taxes 19% 14% 13% 14% 14% 15% Taxes 5% 6% 4% 5% 5% 5% Net income from continuing operations 13% 9% 9% 10% 10% 10% Result from discontinued operations (net of tax) 0% 0% 0% 0% 0% 0% Net income 13% 9% 9% 10% 10% 10% Minority interest -0% -0% -0% -0% -0% -0% Net profit (reported) 13% 9% 9% 10% 10% 10% Source: Company data; AlsterResearch
AlsterResearch Page 11 of 16 Balance sheet (EUR m) 2018 2019 2020 2021E 2022E 2023E Intangible assets (exl. Goodwill) 274 337 546 554 547 540 Goodwill 262 331 542 542 542 542 Property, plant and equipment 84 131 136 134 118 104 Financial assets 35 33 33 33 33 33 FIXED ASSETS 655 833 1,258 1,263 1,241 1,220 Inventories 20 27 18 21 25 27 Accounts receivable 114 112 161 161 186 187 Other current assets 21 30 28 28 28 28 Liquid assets 22 47 77 164 248 306 Deferred taxes 0 0 0 0 0 0 Deferred charges and prepaid expenses 16 17 24 15 19 24 CURRENT ASSETS 193 233 308 388 506 571 TOTAL ASSETS 848 1,066 1,566 1,651 1,747 1,791 SHAREHOLDERS EQUITY 262 259 639 710 782 862 MINORITY INTEREST 2 1 0 0 0 0 Long-term debt 319 453 498 498 498 453 Provisions for pensions and similar obligations 25 31 44 43 46 48 Other provisions 57 86 94 103 110 114 Non-current liabilities 400 570 636 644 654 615 short-term liabilities to banks 11 58 56 50 50 45 Accounts payable 39 47 65 65 71 71 Advance payments received on orders 34 42 64 52 58 64 Other liabilities (incl. from lease and rental contracts) 34 7 6 21 22 24 Deferred taxes 44 71 83 83 83 83 Deferred income 22 11 17 27 27 26 Current liabilities 184 236 291 297 310 313 TOTAL LIABILITIES AND SHAREHOLDERS EQUITY 848 1,066 1,566 1,651 1,747 1,791 Balance sheet (common size) 2018 2019 2020 2021E 2022E 2023E Intangible assets (excl. Goodwill) 32% 32% 35% 34% 31% 30% Goodwill 31% 31% 35% 33% 31% 30% Property, plant and equipment 10% 12% 9% 8% 7% 6% Financial assets 4% 3% 2% 2% 2% 2% FIXED ASSETS 77% 78% 80% 76% 71% 68% Inventories 2% 3% 1% 1% 1% 2% Accounts receivable 13% 11% 10% 10% 11% 10% Other current assets 3% 3% 2% 2% 2% 2% Liquid assets 3% 4% 5% 10% 14% 17% Deferred taxes 0% 0% 0% 0% 0% 0% Deferred charges and prepaid expenses 2% 2% 2% 1% 1% 1% CURRENT ASSETS 23% 22% 20% 24% 29% 32% TOTAL ASSETS 100% 100% 100% 100% 100% 100% SHAREHOLDERS EQUITY 31% 24% 41% 43% 45% 48% MINORITY INTEREST 0% 0% 0% 0% 0% 0% Long-term debt 38% 42% 32% 30% 29% 25% Provisions for pensions and similar obligations 3% 3% 3% 3% 3% 3% Other provisions 7% 8% 6% 6% 6% 6% Non-current liabilities 47% 53% 41% 39% 37% 34% short-term liabilities to banks 1% 5% 4% 3% 3% 3% Accounts payable 5% 4% 4% 4% 4% 4% Advance payments received on orders 4% 4% 4% 3% 3% 4% Other liabilities (incl. from lease and rental contracts) 4% 1% 0% 1% 1% 1% Deferred taxes 5% 7% 5% 5% 5% 5% Deferred income 3% 1% 1% 2% 2% 1% Current liabilities 22% 22% 19% 18% 18% 17% TOTAL LIABILITIES AND SHAREHOLDERS EQUITY 100% 100% 100% 100% 100% 100% Source: Company data; AlsterResearch
AlsterResearch Page 12 of 16 Cash flow statement (EUR m) 2018 2019 2020 2021E 2022E 2023E Net profit/loss 93 66 73 97 104 113 Depreciation of fixed assets (incl. leases) 45 63 76 32 36 35 Amortisation of goodwill 0 0 0 0 0 0 Amortisation of intangible assets 0 0 0 35 37 38 Others 14 6 13 8 10 6 Cash flow from operations before changes in w/c 152 135 162 173 187 193 Increase/decrease in inventory -7 -6 9 -3 -4 -3 Increase/decrease in accounts receivable -13 -11 -34 -1 -25 -0 Increase/decrease in accounts payable -5 4 11 0 6 0 Increase/decrease in other w/c positions 10 -11 1 22 3 2 Increase/decrease in working capital -15 -24 -12 19 -20 -0 Cash flow from operating activities 136 110 150 192 168 192 CAPEX -40 -44 -56 -73 -51 -53 Payments for acquisitions -8 -97 -400 0 0 0 Financial investments 0 0 -2 0 0 0 Income from asset disposals 1 0 1 0 0 0 Cash flow from investing activities -48 -140 -457 -73 -51 -53 Cash flow before financing 89 -29 -307 119 117 140 Increase/decrease in debt position -51 118 25 -6 0 -50 Purchase of own shares -25 -41 0 0 0 0 Capital measures 0 0 338 0 0 0 Dividends paid -17 -24 -24 -26 -32 -32 Others -0 -3 -1 0 0 0 Effects of exchange rate changes on cash -1 0 -1 0 0 0 Cash flow from financing activities -94 50 337 -33 -32 -82 Increase/decrease in liquid assets -5 21 29 86 85 57 Liquid assets at end of period 25 46 76 162 247 304 Source: Company data; AlsterResearch
AlsterResearch Page 13 of 16 Ratios 2018 2019 2020 2021E 2022E 2023E Per share data Earnings per share reported 1.95 1.35 1.40 1.80 1.93 2.09 Cash flow per share 2.54 1.68 2.27 3.15 2.65 3.12 Book value per share 5.32 5.32 12.20 13.21 14.55 16.05 Dividend per share 0.50 0.50 0.50 0.60 0.60 0.60 Valuation P/E 33.4x 48.2x 46.6x 36.2x 33.7x 31.2x P/CF 25.7x 38.7x 28.7x 20.7x 24.6x 20.9x P/BV 12.2x 12.2x 5.3x 4.9x 4.5x 4.1x Dividend yield (%) 0.8% 0.8% 0.8% 0.9% 0.9% 0.9% FCF yield (%) 3.9% 2.6% 3.5% 4.8% 4.1% 4.8% EV/Sales 5.3x 5.4x 4.8x 3.9x 3.5x 3.3x EV/EBITDA 20.4x 22.4x 20.4x 17.7x 16.2x 14.8x EV/EBIT 26.8x 34.7x 33.0x 25.5x 23.3x 20.9x Income statement (EURm) Sales 717 746 837 1,015 1,084 1,122 yoy chg in % 23.1% 4.0% 12.3% 21.2% 6.8% 3.5% Gross profit 584 631 713 851 909 941 Gross margin in % 81.5% 84.7% 85.2% 83.9% 83.9% 83.9% EBITDA 188 178 197 222 238 253 EBITDA margin in % 26.2% 23.9% 23.6% 21.9% 22.0% 22.6% EBIT 143 115 122 154 165 179 EBIT margin in % 20.0% 15.5% 14.5% 15.2% 15.2% 16.0% Net profit 96 66 73 97 104 112 Cash flow statement (EURm) CF from operations 136 110 150 192 168 192 Capex -40 -44 -56 -73 -51 -53 Maintenance Capex 11 29 31 22 25 25 Free cash flow 96 67 94 119 117 140 Balance sheet (EURm) Intangible assets 537 668 1,088 1,096 1,089 1,082 Tangible assets 84 131 136 134 118 104 Shareholders' equity 262 259 639 710 782 862 Pension provisions 25 31 44 43 46 48 Liabilities and provisions 411 628 693 694 704 660 Net financial debt 308 464 477 385 300 193 w/c requirements 60 50 50 66 82 79 Ratios ROE 36.8% 25.5% 11.5% 13.7% 13.4% 13.1% ROCE 21.3% 13.0% 9.1% 11.0% 11.1% 11.8% Net gearing 117.5% 179.0% 74.7% 54.2% 38.4% 22.4% Net debt / EBITDA 1.6x 2.6x 2.4x 1.7x 1.3x 0.8x Source: Company data; AlsterResearch
AlsterResearch
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Conflict of interests
Disclosures regarding research publications of SRH AlsterResearch AG pursuant to section 85 of the German Securities Trading
Act (WpHG) and distributed in the UK under an EEA branch passport, subject to the FCA requirements on research
recommendation disclosures It is essential that any research recommendation is fairly presented and discloses interests of
indicates relevant conflicts of interest. Pursuant to section 85 of the German Securities Trading Act (WpHG) a research report has
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(1) or its affiliate(s) (either in its own right or as part of a consortium) within the past twelve months, acquired the financial
instruments of the analyzed company,
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services with the analyzed company or have received services or a promise of services under the term of such an
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exercising mandates in the interest of the analyzed company or a significant conflict of interest with respect to the issuer,
(8) The research report has been made available to the company prior to its publication. Thereafter, only factual changes
have been made to the report.
Conflicts of interest that existed at the time when this research report was published:
Company Disclosure
CompuGroup Medical SEAlsterResearch
Page 15 of 16
Important disclosures
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the interest-bearing debt capital in order to arrive at the equity value. Detailed further information regarding investment recommendations of the last 12
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