Annual Financial Statements of CGM AG
Profit and financial position of CompuGroup Medical AG
|Net income from investments (income from investments and profit transfers, less expenses from transfer of losses)||36.58||45.76|
|Write-downs on financial assets||-11.72||0|
|Net interest expense (income from lending of financial assets and other interest and similar income less interest and similar expenses)||-9.01||-10.65|
|Net operating result (other income statement items)||-13.27||-12.09|
|Net result from ordinary activities||2.58||23.02|
As a holding company, the Company’s results of operations are largely dependent on the development of its operating subsidiaries. At EUR 36.58 million, net income from investments was down EUR 9.18 million on the previous year. The material items are described below.
Net income from investment rose by approximately 73.7 percent year on year, from EUR 1.46 million in 2012 to EUR 2.54 million in 2013. This increase was due to the EUR 0.10 million rise in the distribution of profits by CompuGroup Medical Ceska Republika (2013: EUR 1.45 million, previous year: EUR 1.35 million), a EUR 0.48 million increase in the distribution of profits by CompuGroup Medical France (2013: EUR 0.59 million, 2012: EUR 0.11 million) as well as the first-time distribution of profits by CompuGroup Medical Belgium (EUR 0.50 million).
Income from profit-transfer agreements declined by 28.49 percent year on year in the reporting period (2013: EUR 34.99 million, previous year: EUR 48.94 million) due to a EUR 5.51 million drop in income at CompuGroup Medical Dentalsysteme GmbH, a EUR 8.96 million decline in income at CompuGroup Medical Deutschland AG as well as a EUR 0.52 million rise in income at IfAp.
The transfer of profits by CompuGroup Medical Dentalsysteme GmbH declined in the reporting year (2012: EUR 9.31 million, previous year: EUR 14.82 million) due to the cessation of the previous year’s transfer of profits by Intermedix Deutschland GmbH (-EUR 3.77 million) at the same time as a transfer of losses (-EUR 0.38 million), a declining net operating result (-EUR 1.10 million) and a drop in the net interest expense (-EUR 0.26 million).
The transfer of profits by CompuGroup Medical Deutschland AG declined by EUR 8.96 million in 2013 (2013: EUR 21.26 million, previous year: EUR 30.22 million). CompuGroup Medical Deutschland AG was established in 2011 following the change in the legal form of CompuGROUP Beteiligungsgesellschaft mbH in the wake of the merger of Albis Ärzteservice Product GmbH & Co. KG nebst Verwaltungs-GmbH, CompuGroup Medical Arztsysteme GmbH & Co. KG nebst Verwaltungs-GmbH, Telemed Online Service für Heilberufe GmbH, Ispro GmbH, Vita-X AG, Inmedea GmbH and CompuGroup Medical Deutschland GmbH to form CompuGROUP Beteiligungsgesellschaft mbH. Medistar Praxiscomputer GmbH and Turbomed EDV GmbH were also merged with CompuGroup Medical Deutschland AG in 2012. The drop in income at CompuGROUP Medica Deutschland AG is the result of a rise in the transfer of losses by CompuGroup Medical Software GmbH (-EUR 2.94 million), lower net interest income resulting from special revenue generated in the previous year (-EUR 1.36 million) and a drop in the net operating result (-EUR 4.66 million).
As in the previous year, the transfer of profits by ifap GmbH again recorded a slight rise in revenue and income in the 2013 financial year (2013: EUR 4.42 million, previous year: EUR 3.90 million).
Expenses from the transfer of losses declined by EUR 3.69 million in the reporting period (2013: EUR 0.95 million, previous year: EUR 4.64 million) which, as in the previous year, came from CGM Systema Deutschland GmbH. The EUR 3.69 million rise in income resulted primarily from the discontinuation of extraordinary merger losses in the amount of EUR 5.12 million compared to the previous year as well as a EUR 1.46 million rise in personnel costs in 2013.
Write-downs on financial assets amounted to EUR 11.72 million in the 2013 financial year for an impairment of loans granted by subsidiary CompuGroup Holding USA, Inc.
The following impacted net interest expenses in the reporting year:
Interest and similar expenses declined by EUR 3.02 million year on year, mainly due to reduction in the flexible interest rates of the SEB consortium credit of up to 0.75 percentage points, a EUR 1.13 million drop in interest expenses from taxes (2013: EUR 0.05 million, previous year: EUR 1.18 million) as well as a reduction in interest expenses to associated companies resulting from a drop in internal Group interest rates, which are based on the terms and conditions of the SEB consortium credit. As of 31 December 2013, IKB still had two KfW loans from 2010, each for EUR 10 million (as of 31 December 2013: EUR 8.75 million, previous year: EUR 16.04 million), as well as the loan granted at the end of 2010 by SEB for EUR 300 million, which was then converted into a consortium loan in June 2011 by taking on an additional eight banks while at the same time increasing the loan amount to EUR 330 million. The SEB loan consists of a “term loan facility” for EUR 190 million, of which EUR 30 million was repaid in both 2013 and 2012 (utilized as of 31 December 2013: EUR 130 million, previous year: EUR 160 million) and a “revolving loan facility” for EUR 140 million (utilized as of 31 December 2013: EUR 125 million, previous year: EUR 77 million). An additional SEB loan of EUR 15 million was taken out at the end of 2013 and utilized in full, as was a EUR 30 million loan granted by Commerzbank, although only EUR 18 million of this loan had been utilized by the balance sheet date. Both of these new loans are “revolving loan facilities.” Interest and similar expenses to banks were composed of – in the reporting year and therefore primarily – interest payments on the IKB loan and the SEB consortium credit for the entire reporting year as well as, to a lesser extent, interest expenses for the two new loans at the end of the year. In addition, commitment fees totaling EUR 0.92 million has to be paid in the reporting year for the part of the consortium loan not utilized.
Other interest and similar income amounted to EUR 1.94 million in the financial year, down EUR 0.69 million year on year, mainly due to a drop in internal Group interest rates and the corresponding decline in interest income from associated companies. At EUR 4.98 million, income from the lending of financial assets was down EUR 0.69 million year on year, which was also primarily a result of the drop in interest rates.
The EUR 1.18 million decline in the net operating result to EUR -13.27 million was mainly due to the reduction in other operating income (-EUR 2.06 million) resulting from the year-on-year elimination of a release of valuation adjustments on receivables from associated companies in the amount of EUR 5.6 million while at the same time income from foreign exchange gains rose by EUR 3.34 million in the reporting year (2013: EUR 6.39 million, previous year: EUR 3.05 million). This effect is offset by the EUR 1.91 million rise in sales revenue. At EUR 12.22 million, personnel costs were down EUR 0.57 million year on year. Other operating expenses rose by EUR 1.83 million in the reporting period to EUR 24.29 million. The rise in other operating costs resulted from, among other things, the rise in foreign exchange losses (2013: EUR 5.85 million, previous year: EUR 3.14 million) as well as increases in IT costs (EUR 1.36 million), occupancy costs (EUR 0.43 million) and vehicle costs (EUR 0.40 million). This effect is offset by the elimination of the accounting loss of EUR 5.1 million from 2012, which was realized within the scope of the previous year’s merger of Tepe International A.S. with CompuGroup Medical Bilgi Sistemleri A.S.
Income tax amounted to EUR 3.81 million in the reporting period (previous year: EUR 15.83 million). This was due to a EUR 0.96 million reduction in deferred taxes (previous year: increase of EUR 5.22 million = effect -EUR 6.18 million), a tax rebate from previous years of EUR 0.09 million (previous year: additional payment of EUR 1.63 million = effect -EUR 1.72 million) as well as lower taxes for the current year resulting from the lower amount of taxable profit.
The control of payment transactions is mainly handled by the Group’s accounting department in Koblenz using a cash management system. In the operating business, cash flow from operating activities covers the Group companies’ capital requirements. As in the previous year, interest on the Company’s cash and cash equivalents was charged on the basis of current, non-speculative investments.
Net assets of CompuGroup Medical AG
Congruent to the Company’s holding function, financial assets, at approximately 86 percent (previous year: approximately 87 percent), represent that most important balance sheet asset in terms of value, rising by EUR 19.04 million year on year to EUR 522.13 million.
This is the result of a EUR 1.3 million rise in loans to associated companies as well as prepayments made in the reporting year on investments in associated companies (EUR 20.22 million) in connection with the acquisition of interests in French companies “Imagine Editions” and “Imagine Assistance” concluded in January 2014. The rise in loans to associated companies primarily resulted from impairment of loans to the CGM US holding company and new loans to CompuGroup Medical Italia Holding S.r.l. in connection with the acquisition of majority holdings in Italian companies Studiofarma S.r.l. and Qualità in Farmacia S.r.l. in July 2013.
CompuGroup Medical AG did not repurchase any shares in the 2013 financial year. Of the 3,600,939 treasury shares held as of 31 December 2012, a total of 105,208 shares were sold within the scope of the prepayment for the shares in Imagine Group. Consequently, the Company held 3,495,731 treasury shares on reporting date 31 December 2013; as of the balance sheet date, these were entered at nominal value in a separate column in equity. The issued capital reported was therefore lower. The nominal value of the corresponding interest is reported as a reserve in accordance with Section 237 (5) Aktiengesetz (AktG – German Stock Corporation Act) (mutatis mutandis).
At 30.64 percent, the equity ratio in the reporting period was down year on year (previous year: 35.18 percent). This was largely due to the rise in the balance sheet total and the decline in capital resulting from the dividend payment of EUR 17.37 million in 2012 and the US loan impairment, which together was greater in relation to overall net profit.
Just as was the case with receivables from associated companies, liabilities to associated companies also resulted from the internal Group cash management system. Please refer to the section titled “Results of operations and financial position of CompuGroup Medical AG” for details on liabilities to banks.