iSoft released its annual 2010 Full Year results just on market open today.
You can read the gruesome details here:
and for the real details here:
The result has already be covered here:
iSoft CEO steps down after poor result
- Michael Bennet
- From: The Australian
- August 31, 2010
ISOFT Group chief Gary Cohen has stepped down as part of a review after a horror full-year result.
Shares in the Sydney health information technology company slumped more than 20 per cent to 12.5 cents, after it reported a $382.9 million loss, following $34.7m profit last year.
The company's shares have now fallen about 83 per cent this year.
The result included a $341m one-off impairment charge, primarily related to goodwill. Total revenue fell 20 per cent to $431 million and earnings before interest tax depreciation and amortisation tumbled 77 per cent to $30m.
Chairman Robert Moran, who described the result as "disappointing", said iSOFT's board has commenced an in-depth review of the company's business operations.
A number of aspects of the review are already being implemented, including the departure of Mr Cohen who will remain with the company to assist with its transition and strategic development.
iSOFT has engaged an executive search firm to assist in finding a new CEO, with chief operating officer Andrea Fiumicelli to serve as acting chief.
The company has also commenced a "board renewal" process to identify candidates from both Britain and Australia to join the board.
On the result, Mr Moran said: "A difficult economic environment, adverse currency impact, delays to the implementation of the National Program for IT in the UK and an increased cost structure all contributed to this result."
iSOFT changed its name back to iSOFT last year after IBA Health acquired the group in 2007.
Mr Moran said the review has already targeted annualised operational cost savings of $50m by end of June 2011, with more than half of this to come through headcount reductions.
There is also some additional information here:
STOCKS ON THE MOVE
* Health information company iSoft (ISF.AX)
ISF.AX, (0.135, -0.030, -18.180%), the market's most active stock, lost a quarter of its value to hit a 6-½ year low of A$0.125 after it reported a loss of A$383 million due to a hefty writedown of goodwill.
It said it needed to restructure its senior debt facilities, review its capital structure and was considering asset sales. Its chief executive stepped aside to work with the board on strategic options for the company.
Full article is here:
Clearly all this is pretty bad news for iSoft investors – to say nothing about how the ex-CEO (Gary Cohen) must feel to essentially lose his job.
While it is hard to be sure it does seem we are in part seeing in the figures the effects of the takeover transaction from a year or so ago impacting – as well as all the issues around the UK National Program for Health IT which have harmed cash flow and the need to recognise that there has been a major reduction in the value of the company’s intangible assets.
The 2009 annual report reveals there was over a billion dollars of intangible assets on the company and with the write down in these results this amount has been essentially halved but it is still a rather large $480 million.
Given that the company has a very substantial amount of ongoing legacy and maintenance revenue and many customers all over the world as well as a very newly developed and apparently quite good product in Lorenzo we can only hope the steps planned will turn the ship around!
For all concerned it would be sad if this can’t be achieved, but I doubt it will be quick!