We emerge from 2013
stronger, larger and better positioned
than ever before.
In November 2013, we won a 20 million Euro tender for testing the so called ‘Telematic Infrastructure’ in one of two pilot regions in Germany. With this project, the foundation for a modern electronic infrastructure in the German healthcare system has been laid. The Telematic Infrastructure is a closed network only accessible to those holding a healthcare professional card or an electronic healthcare card – the so called eGK. It fits perfectly with CGMs strategy to provide more products and services to our customers, such as electronic prescriptions, electronic laboratory test orders, online appointment scheduling and prescription renewals for patients, physician networks, online clinical pathways, hosting services etc. It is a transformational project for CGM and we have waited more than 10 years for this exiting start of a new era in our home market. Winning this contract is also a sign from the National Association of Statutory Health Insurance Physicians, the Statutory Health Insurance Funds and other leading organizations regarding their appreciation of our innovative abilities.
So we certainly made important progress in 2013 – even if the financial results show a more mixed picture. Revenue of 460 million Euro and EBITDA of 98 million Euro was not what we were aiming for and especially the beginning of the year set out on a weaker footing than expected. On the positive side, we quickly made the necessary adjustments and the situation improved during the year. Margins were higher in the last three months compared to the year before and this shows the ‘finish strong’ attitude in CGM. A strong character gives confidence in the future.
There were also other areas of good development in 2013. The sales records set at the Expopharm trade fair are a testimony that we are on the right track with our innovation and growth strategy in our pharmacy software business. Software for pharmacies is a new and exciting area for CGM as we entered the market with the Lauer-Fischer acquisition in 2011. Since then, we have built on the position as the gold standard in the German market and transformed this company into a high-margin and growing operating segment. Software for pharmacies has everything we like in a business, with long-term customer relationships and a service-oriented business model based on recurring revenue. With a solid foundation in our home market, the next step outside Germany after the Netherlands was in July 2013 when we acquired the market leader for pharmacy software in Italy, Studiofarma, including its largest distributor. Serving more than 7,000 pharmacies all over Italy, it is a clear market leader, and 2014 will be used to create an efficient and powerful business structure similar to the one in Germany. And as always: Organic growth based on a deeper and deeper relationship with our existing customers.
As much as we focus on organic growth within our existing customer base, we also look for acquisitions to grow the number of customers. The acquisition of Imagine Group in France is a perfect example of a classic CGM acquisition: Acquiring a market leader in doctor software in a core European market. With Imagine Group, or ‘HelloDoc’ as it is known in the market, we added more than 20,000 doctors to our customer base. Together with our existing business in France, we are now the clear market leader for office based doctors in the second largest European nation. Ever more, we are becoming the clear market leader in software for healthcare providers in all of Europe.
Finally, with the acquisition of vision4health right over the year-end, we are now firmly established as one of the leading software suppliers for laboratory and diagnostics in Europe. The IT solution of a laboratory starts at the ordering doctor’s office and we have for many years seen the benefits of creating networks between healthcare providers and diagnostic services. Combining our existing customers and the innovative products from vision4health we now have an improved end-to-end capability to serve laboratories, doctors and hospitals even better. And, again, it makes us even stronger in our core European markets.
We emerge from 2013 stronger, larger and better positioned than ever before. For making this a reality, I want to thank all my colleagues, all our shareholders, our customers and all the members of the CGM family for their dedication to our business, for their loyalty and for their support. Thank you!
27 March 2014