1、Craneware plcAnnual Report and Financial Statements For the year ended 30 June 2021Together,We areHelping healthcare providers further their mission through optimal financial and operational performanceTable of ContentsFinancial and Operational Highlights 1Solutions 2Chairmans Statement 4Strategic R
2、eport:Operational and Financial Review 5Strategic Report:Key Performance Indicators and Principal Risks and Uncertainties 13Strategic Report:Section 172(1)Statement 18Stakeholder Engagement 22Social Responsibility and Sustainability Statement 27Directors,Secretary,Advisors and Subsidiaries 30Board o
3、f Directors 31 Directors Report 33Corporate Governance Report 39Remuneration Committees Report 48Independent Auditors Report to the members of Craneware plc 57Consolidated Statement of Comprehensive Income 64Statements of Changes in Equity 65Consolidated Balance Sheet 66Company Balance Sheet 67State
4、ments of Cash Flows 68Notes to the Financial Statements 691Cranewareplc AnnualReport202101020304050607080202175.6202071.5201971.4201867.1201757.80510152025202127.1202025.2201924.0201821.6201718.0010203040506070202169.0202065.4201963.3201860.2201751.4$75.6m Revenue$27.1m Adjusted EBITDA1$235.6m Cash1
5、5.5p Final Dividend69.0 Adjusted EPS1$13.2m ProfitQuick Facts FinancialFinancial Revenue increase of 6%to$75.6m(FY20:$71.5m)Adjusted EBITDA1 increased 8%to$27.1m(FY20:$25.2m)Profit before tax$13.2m(FY20:$19.3m)reflecting one-off exceptional costs associated with acquisition funding Basic adjusted EP
6、S1 increased 6%to 69.0 cents(FY20:65.4 cents)and adjusted diluted EPS increased to 68.1 cents(FY20:64.4 cents)Basic EPS 48.1 cents(FY20:62.8 cents)and diluted EPS 47.5 cents(FY20:61.9 cents)Three Year Total Visible Revenue2(including Sentry contribution from 13th July 2021 onwards)of$471.2m(FY20 sam
7、e 3 year period:$196.2m)Strong operating cash conversion1 at 99%of Adjusted EBITDA(FY20:92%)Cash at year-end of$235.6m(FY20:$47.9m)after raising$187.3m(net)via a share placing and prior to completion of the Sentry acquisition Proposed final dividend increase to 15.5p per share(21.47 cents)(FY20:15.0
8、p,18.45 cents)giving a total dividend for the year of 27.5p per share(38.10 cents)(FY20:26.5p,32.60 cents)up 4%1 Certain financial measures are not determined under IFRS and are alternative performance measures as described in Note 26 of the financial statements2 Refer to the Financial Review sectio
9、n of the Strategic Report for further detailsOperational Total Sales1 for the year increased 19%to$78.1m(FY20:$65.4m)New Sales1 for the year increased 40%to$42.4m(FY20:$30.4m)Sales of Trisus Enterprise Value Platform products represented 17%of New Sales in the year(FY20:14%)Acceleration of migration
10、 of customers to the Trisus platform,with the Trisus user base increasing to over 900 customers(FY20:200 customers)Continued investment in R&D and innovation to capitalise on growing market opportunity The acquisition of Sentry Data Systems,Inc.was completed following the year end,significantly expa
11、nding Cranewares scale,offering and opportunity Financial and Operational Highlights2Cranewareplc AnnualReport2021Software thatautomatically uploadschargemaster changes tothe patient billing systemfor accurate billing.Integration for Chargemaster Management_Web-based,mobile-friendly supplies lookupa
12、vailable in Trisus Supplyor stand alone.TrisusSupplies Assistant enablesproviders to accessCranewares proprietarysupply master catalog andquickly and correctly codeexpensive implants anddevices.Trisus Supplies AssistantSaaS solution for providers with less than$44 million in operating expenses to pe
13、rform chargemaster analysis,and efficiently optimise revenue,charge compliance and coding integrity.Reference PlusWeb-based and mobile-friendly application for reducing risk by providing access to reference and regulatory resources.Online Reference ToolkitSaaS solutions formanaging physiciangroup KP
14、Is,charges,codes,RVUs,feeschedules,and relatedinformationPhysician Revenue ToolkitSaaS solution thatsimplifies the pricemodelling process,creating a repeatable,well-documentedmethod to establishtransparent,defensibleand competitive pricingTrisus Pricing AnalyzerUtilizes foundational datafrom the ite
15、m master,ORFile,purchase history,andchargemaster to identifydata gaps between thesystems,ensuring everyreimbursable supply,implant,and deviceis billed.Trisus SupplyImproves chargecapture,pricing and costmanagement,whilesimplifying the processfor ensuring drug codingand billing units arecomplete and
16、compliant,and establishing andmaintaining a connectionbetween a providerspharmaceutical purchasesand billing.Pharmacy ChargeLinkAutomated SaaS chargemastermanagement solutions forcapturing optimal legitimatereimbursement for providers,while mitigating compliancerisk.Chargemaster Toolkit iscustomisab
17、le for any organisation,from small community providersto large healthcare networks,andaddresses the challenges thatenterprise chargemaster datapresents to hospitals by enablingall related chargemaster data tobe viewed in one place.Chargemaster ToolkitCraneware SolutionsPatient EngagementCharge Captu
18、re&PricingCraneware Value Cycle Solutions span five product families Patient Engagement,Charge Capture&Pricing,Claims Analytics,Revenue Recovery&Retention,and Cost&Margin Analytics.In addition,hospitals of all sizes and types rely on Cranewares Customer Success Management and other Professional Serv
19、ices to help deliver results that lead to improved financial outcomes.3Cranewareplc AnnualReport2021Web-based,mobile-friendly supplies lookupavailable in Trisus Supplyor stand alone.TrisusSupplies Assistant enablesproviders to accessCranewares proprietarysupply master catalog andquickly and correctl
20、y codeexpensive implants anddevices.Trisus Supplies AssistantPatient EngagementOur consultants provide onsitestaffing and expertise to helphospitals achieve their financialgoals.Customer SuccessManagers design future stateoperations,develop policiesand procedures,train staff onoperational tasks,and
21、measureand report on success metrics.Customer Success Management and Consulting Services A cost analytics andresource efficiencyplatform that unitescost and operationalinformation across theprovider organisation,delivering revenue,cost,and operationalinformation for eachpatient encounterTrisus Healt
22、hcare IntelligenceCraneware has theexperienced staff neededto review denials,writesuccessful appeals andoverturn improperdenials.Appeals ServiceA comprehensive,web-based audit managementapplication thatempowers healthcareorganisations to managegovernment andcommercial audits fromone central location
23、.InSight AuditAnalyses,tracks,trends and reportson denial data,providing workflowfor expediting repairand resubmission ofdenied claims.InSight DenialsSoftware built onCranewares Trisusplatform that automatesclaim and coding reviewsto identify missedcharges,billing errors,and categorise areas ofrisk
24、to help ensure thatall legitimate revenue iscaptured.Trisus Claims InformaticsAn easy,automatedapplication for hospitals tomeet the 2021 CMS pricingtransparency requirementsfor posting both standardcharges and shoppableservices online.Analyticson patient searches forshoppable services areprovided ba
25、ck to hospitalsto ensure ongoing,proactivepricing strategies.Trisus Pricing Transparency_A SaaS solution thatprovides medicalnecessity validation forall major US payors andAdvance BeneficiaryNotice(ABN)creation.Thesoftware helps reduceaccounts-receivable daysby preventing medicalnecessity denials,an
26、dfacilitates paymentcommunication withpatients.InSight Medical NecessitySolutions for healthcare providers to optimise financial and operational performance.Customer Success Management Cost&Margin AnalyticsRevenue Recovery&RetentionClaims AnalyticsCraneware Value Cycle Solutions span five product fa
27、milies Patient Engagement,Charge Capture&Pricing,Claims Analytics,Revenue Recovery&Retention,and Cost&Margin Analytics.In addition,hospitals of all sizes and types rely on Cranewares Customer Success Management and other Professional Services to help deliver results that lead to improved financial o
28、utcomes.4Cranewareplc AnnualReport2021operational and strategic decisions such that our customers can spend dollars far more productively on keeping people well.The Groups cash reserves remain healthy,delivering an operating cash conversion rate of 99%,ahead of the prior years 92%.We maintained a st
29、rong balance sheet,with cash of$235.6m at 30 June 2021,including the net funds of$187.3m received from the equity raise in anticipation of the acquisition of Sentry(FY20:$47.9m).A continued focus has been our commitment to social responsibility and community engagement.Craneware has and continues to
30、 develop many initiatives that contribute to our credentials in these areas.I am particularly proud of the work of Craneware Cares and the Craneware Cares Foundation,driven by our employees.Even though they were mostly working from home through this year,they still managed to help a total of 41 diff
31、erent charities across the UK and US,including our eight Spotlight Charities.Our opportunity to effect real change is clear and our ability to execute has been considerably enhanced.Following a year of heightened pressure,our US hospital customers are more motivated than ever to implement strategic
32、and long-term planning and our Trisus platform is specifically designed to help them achieve this.The high visibility we have over future revenues combined with our robust financial position gives us the ability to plan and execute our long-term strategy to serve the best needs of our customers.We e
33、nter the new year with a strong pipeline,supporting the Boards confidence in the Groups continued growth and our ability to increase stakeholder value.Will Whitehorn Chairman 20 September 2021In a year still defined by the wider context of a global pandemic,our purpose has been brought into sharp fo
34、cus.As we reflect on our mission,I am proud of the impact Craneware has made in helping our US healthcare customers improve operational efficiency and margins so that they can continue to invest in providing quality care for their communities.Our contribution and continued success are made possible
35、through the efforts of our dedicated and talented employees who work to push Craneware closer towards the long-term ambition of being the pre-eminent company in improving US healthcare.Our teams and customers have shown great fortitude and adaptability in a complex and challenging pandemic environme
36、nt,and on behalf of the Board I would like to extend our admiration and gratitude.The Group has made strategic strides in the year through positive sales momentum,targeted innovation and at the same time sustained customer retention rates above 90%,all underpinning the foundation for a return to dou
37、ble-digit organic growth in future years.Continued new product releases drove strong adoption of Trisus,the Groups cloud-based Financial and Operational performance platform,from both new and existing customers.As a result,New Sales increased 40%to over$42.4m(FY20:$30.4m)with approximately 50%of Cra
38、neware customers now using one or more of the platforms products.The building sales momentum translated into an increase in total recognised revenue of 6%to$75.6m,(FY20:$71.5m),with Adjusted EBITDA growing 8%to$27.1m(FY20:$25.2m).Following the year end,the Group completed the acquisition of US-based
39、 Sentry Data Systems,Inc.(“Sentry”),enhancing the Groups pharmacy offering and cementing Cranewares position as a leading provider of Value Cycle solutions to the US healthcare market.This has provided an immediate step change in scale to operations and expanded our coverage of the US Healthcare mar
40、ket with Craneware now serving approximately 40%of all US hospitals and more than 10,000 clinics and pharmacies.In Sentry we identified a business aligned to our vision and the combined data sets from both companies will deliver far-reaching actionable insights for better Chairmans StatementStrategi
41、c Report:Operational and Financial Review5Cranewareplc AnnualReport2021the majority of US States,they are yet to get back to pre-pandemic levels.However,industry reports suggest that hospital operating margins have been largely protected through this time.Operationally,healthcare providers have had
42、to adjust to new methods of healthcare delivery,while ensuring their financial operations have the flexibility and agility to charge for those services appropriately,highlighting the importance of usable financial and operational data.Healthcare providers requirements for greater insight into cost o
43、f care,associated margins and the value being derived is as high,if not higher,than ever.Against that backdrop,the US healthcare market continues to transition from a fee-for-service reimbursement model,towards value-based care,aiming to redress the current imbalance in US healthcare between spend a
44、nd outcomes.Under value-based care,healthcare providers,including hospitals and physicians,are paid based on patient health outcomes.A hospitals ability to remain financially secure in a value-based care system is dependent on the collection of granular data and the use of insightful analytics to un
45、derstand the opportunity to deliver better value.This presents a large,growing opportunity for the Group given Cranewares specialism in helping hospitals better understand and manage revenue and cost through data-driven solutions.Our customers continue to take steps to create further resilience acro
46、ss their financial operations.We are committed to partnering with them by providing the platform,regulatory information and data to enable them to do so.We believe that both the Group and our customer base are strongly placed to deal with the future impacts of the pandemic and for our products to be
47、 part of the solution in terms of helping hospital preparedness.Both Republicans and Democrats have previously expressed their desire for healthcare reform and the industry widely anticipates that reform will remain a key agenda point moving forward,with the drive to derive greater value from health
48、care sitting at its heart.Recent government initiatives have seen a robust defence of existing healthcare legislation.In addition,the new administration in the White House has recently expressed the desire to see an increase in investment into healthcare,both from Private Equity and the community,wh
49、ich we anticipate will in turn boost operational investments by healthcare providers.While other platforms have been designed to address the clinical side of a hospital,from a competitive positioning perspective,we have created the markets only platform addressing the breadth of the value cycle,aimi
50、ng to solve inefficiencies and waste across both operational,administrative and financial functions of a hospital.Through the acquisition of Sentry,we have created considerable distance between us and other point solution vendors,in terms of depth of data,breadth of offering,size of customer base an
51、d scale of operations,increasing our ability to address what is a growing and sustainable,long-term addressable market.Growth StrategyInnovation to profoundly impact US healthcare operations which will drive demand and expand our addressable marketTo date,our growth has been driven through increases
52、 in market share and product set penetration(land and expand).In recent years,we have invested in the development of the Trisus platform;a sophisticated cloud data aggregation and intelligence platform which will allow us to migrate Operational ReviewWe are pleased to deliver this set of financial r
53、esults in the year,with the growth in customer numbers,New Sales and Trisus Sales being strong indicators of the successes being achieved across all three of our growth pillars,building the foundations for accelerated growth.Through our Trisus platform we are at the vanguard of change in healthcare,
54、a force which continues to gather momentum.Our strong New Sales growth demonstrates the relevance of our offering and we are increasingly confident in achieving our long-term vision of becoming the pre-eminent company in improving US healthcare.Following our growth in FY21 and the subsequent acquisi
55、tion of Sentry Data Systems,Inc.(“Sentry”),approximately 40%of US hospitals are now Craneware customers,alongside more than 10,000 clinics and retail pharmacies.Our enlarged scale and capabilities have considerably strengthened our ability to achieve our mission:to profoundly impact healthcare by im
56、proving our customers operational efficiency and margins so they can continue to invest in providing quality care for their communities.This mission guides our strategy and actions,ensuring that everything we do has a positive impact on our customers performance.With over 900 US hospitals now intera
57、cting with our Trisus platform,contributing many millions of individual anonymised data points daily,it is an increasingly powerful source of insight into the ways in which hospital management teams can improve their financial and operational performance.Our Trisus platform and applications combine
58、revenue integrity,cost management and decision enablement into a single cloud-based platform.The platform makes the raw data taken from multiple disparate systems useable for analysis,resolves communication gaps between departments,remedies operational inefficiencies and helps to manage and maintain
59、 our customers competitive advantage while preserving margin.In turn,the mitigated risks,efficiencies and returns on investment being delivered by our applications will provide the confidence and continuity for our customers to invest in the delivery of quality care to their communities.The positive
60、 progress in the year has been achieved against the ongoing backdrop of COVID-19.Whilst as a business we continue to be relatively insulated from the direct impacts of the pandemic,our customers are on the front-line,managing a constantly evolving and complex situation.Supporting them and the phenom
61、enal work has been,and will continue to be our top priority.Never has the need for accurate financial data,insight and analytics been more important,and we will continue to do all we can to ensure our customers have the tools they need to maintain the financial health of their organisations and supp
62、ort them in their long-term strategic ambitions.MarketThe move to value-based care continues at paceManaging the impact of the COVID-19 pandemic has clearly been the top priority for all healthcare-related organisations over the past 18 months and will continue to be so.While elective procedures hav
63、e increased across Strategic Report:Operational and Financial Review Contd6Cranewareplc AnnualReport20212.To continue to enhance the capabilities of the platform through the addition of new technology layers and applications,developed through internal R&D,selective M&A and Third-Party Partnerships.D
64、uring the first half of the year we announced the availability of Trisus Pricing Transparency(“TPT”)to all US healthcare providers.This no cost Trisus solution was developed to enable organisations not only to meet CMS Pricing Transparency Final Rule requirements(which came into effect in January 20
65、21)but ensure that organisational pricing data is most accurately represented for patients on an ongoing basis allowing individuals to“shop”for their healthcare needs.Adoption of the module has continued in the second half with and acceleration of the migration of existing customers to the Trisus pl
66、atform alongside take-up by new users.This provides a clear pathway for wider Trisus application uptake in the future by these new customers and the significant majority of the 900 Trisus users are now on paid for modules.Through the growth of our Trisus customer base,and the interaction of their da
67、ta with the Trisus platform,we have in excess of 120m individual anonymised patient encounters recorded on the platform,an increase of more than 30%over the course of the year.The greater number of data points,the more powerful the analytics and insights that can be provided to help hospitals in the
68、ir financial decision-making.These encounters include one fifth of all emergency room visits in the US during the last year and almost one quarter of all hospital admissions.We will continue to invest in expanding the capabilities of the platform,developing additional applications and tools,to provi
69、de further benefits to our customers.Following the acquisition of Sentry post year end,the focus is on the integration of Sentry data onto the platform,adding more contextual data which will in turn drive the development of more applications and increase the attractiveness of the platform and provid
70、e further reasons for a healthcare provider to join.We are pleased to confirm that the level of sales of Trisus applications exceeds 60%of the amount of capitalised R&D spent on the platform and Trisus applications development to date,already underwriting the majority of the investment made.M&AWhile
71、 organic growth remains a priority,we continue to evaluate the market and will continue to pursue strategically aligned companies that will accelerate our growth strategy,although it is unlikely that any acquisitions in the short-term will be of the relative scale of Sentry.We maintain the same four
72、 key acquisition criteria of which target companies must fit into at least one,being:1.the addition of data sets;2.the extension of the customer base;3.the expansion of expertise;and4.the addition of applications suitable for the US hospital market.In evaluating acquisition opportunities,the Board i
73、mplements a strong valuation discipline seeking to maintain its prudent approach to preserving balance sheet strength and efficiency for the long-term.Targets that are profitable with recurring revenue models that provide earnings accretion within the first 12 months of ownership are prioritised.our
74、 existing products to the cloud,leverage our data assets to expand our offering,integrate third party solutions to the platform and benefit from the scalability of cloud-technology.Our software solutions sit at the heart of our customers operations,tapping into the aggregated anonymised data held wi
75、thin Trisus to provide greater insight and control to their financial operations and thereby optimise their financial performance.Three Growth PillarsOur growth strategy has three fundamental growth pillars:1.The transition of our customers to cloud-based versions of our existing on-premise solution
76、s,to act as a gateway to the benefits and additional applications on the Trisus platform.By the end of June 2021,over 900 customers,approximately half of our customer base,were utilising one or more of the Trisus applications,with almost the entirety of the remainder connecting to the platform via t
77、he Trisus Bridge the first step for significant migration to the platform from within our user base.This is another positive step forward,from the 500 reported at the half year stage and 200 at the end June 2020,evidence that both our existing customer base and the wider healthcare provider market h
78、ave responded positively to the technological evolution of the Craneware solution set.The full Trisus Chargemaster solution,the re-platformed version of our Chargemaster Toolkit,is on course to be available by the end of calendar 2021.All existing Chargemaster Toolkit customers are now on a hybrid v
79、ersion,with their data synchronised to the Trisus platform,and using a single Trisus sign on,meaning migration to the full cloud version and all its additional functionality will take minutes once launched.We are commencing the migration of customers to Trisus Chargemaster in phases,with migration o
80、f early adopters now complete.Customer feedback has been extremely positive,identifying clear additional benefits that the platform is delivering,including ease of migration,use and deployment throughout large scale implementations.We are on track to have all customers migrated to the platform by th
81、e end of calendar 2022.All customers who have signed new contracts for Chargemaster Toolkit in recent periods have an understood migration plan to Trisus Chargemaster and recognise this as an easy entry to the Trisus platform.We have also commenced the migration of early adopter customers to Trisus
82、Pharmacy Financial Management(TRxFM),a new product,which in phase one,will sit alongside our on-premise Pharmacy ChargeLink and the range of pharmacy products will subsequently be expanded to include all Pharmacy ChargeLink functionality in a new suite of applications.Pharmacy ChargeLink customers a
83、re currently being offered the opportunity to extend their products with the addition of the cloud based TRxFM,which is a precursor to further applications in the Trisus Pharmacy suite,the complete replacement for the on-premise solution.This will continue to be developed in a modular fashion,allowi
84、ng customers to select which mix of applications best suits their needs as they become available.It is anticipated that the cloud-based replacements for Pharmacy Chargelink(PCL)will be available Q4 FY22.All of the acquired customers of Sentry are serviced utilising the Oracle cloud architecture.We a
85、re continuing to develop the additional functionality of all our cloud offerings as we move towards general release.Strategic Report:Operational and Financial Review Contd7Cranewareplc AnnualReport2021marketing team.Integration of the Sentry team into our organisation is progressing well,with the va
86、rious teams now working through their first 100 day integration plans.We have begun the analysis to identify cross-sale opportunities,with these programmes expected to launch in H2 FY22.The successful integration of Sentry will be a key focus for the year ahead.Our People and CommunityAs part of our
87、 commitment to social responsibility and community engagement,Craneware has continued to develop a number of programs and opportunities to positively impact the community around us.A number of years ago,we formed Craneware Cares,an employee committee that is aimed at raising awareness and funds for
88、charity.Craneware Cares and its foundation are integral to our business-better outcomes for all is not just a tag line,it is how we approach our Social agenda.The focus for 2021 was to help the charities who had been hit by a shortfall in donations as a result of the COVID-19 pandemic.Craneware Care
89、s helped over 40 charities across the UK and the US,not only by making cash donations,but also by providing housing supplies,school supplies,care bags for children in the foster system,holiday gifts and even chocolate easter eggs to The Spartans CFA.Some of the charities we supported include one of
90、our US Spotlight Charities,Guardian Angels Suitcases 4 Kids where we exceeded our goal and sponsored 24 children in need,the MS Therapy Centre by raising funds to allow them to purchase essential physiotherapy equipment so they could continue helping their community,and one of our UK Spotlight Chari
91、ties,CERT UK,a 100%volunteer-run organisation that takes care of people affected by crisis,emergencies created by natural disasters,to name only a few.The fund-raising activities of Craneware Cares supplement the Volunteer Time Off program where Craneware employees take paid leave to support project
92、s and charities in their communities.With the addition of Sentrys solutions we are now directly involved in the 340B Program,assisting eligible healthcare organisations with regulatory compliance and pharmacy procurement and utilisation that goes with this program,thereby enabling them to generate c
93、ost savings which go directly to the provision of more care for the underserved in their communities.3.To grow our customer footprint,through increasing the attractiveness of our offering and acquiring non-overlapping customers,which in turn provides further cross-sale opportunities.We are pleased w
94、ith the sales activity during the year,which saw New Sales 40%ahead of the prior year.26%of these New Sales were to net new customers.Expansion Sales to existing customers represented 74%,demonstrating Cranewares ability to continue to cross sell further solutions.All sales have been driven by mitig
95、ation of risk,efficiency of operations and compelling ROIs for our customers.Sales of Trisus products represented 17%of New Sales in the year(FY20:14%)representing a steadily increasing proportion of sales in addition to the take up from our customers of the Trisus Pricing Transparency product.We al
96、so saw our first Trisus renewals in the year.Customer retention has always been strong,and we continued to see our customer retention rate remain high in the period above 90%.Acquisition of Sentry Data Systems,Inc.Sentry Data Systems,Inc.is a leader in pharmacy procurement,compliance and utilisation
97、 management.The successful conclusion of the acquisition following the end of the year marks a transformational point in our journey,considerably expanding our customer base,data sets,product offering and market presence.The acquisition enhances our focus on pharmacy operations within healthcare pro
98、viders,the largest cost area for US hospitals outside the workforce and extends the reach of our Pharmacy Chargelink product family within retail and contract specialty pharmacies.Sentrys 147 million unique longitudinal patient records collected over a 17 year period will enhance the power of our Tr
99、isus platform and we also envisage significant cross-selling opportunities will be provided by the complementary nature of Sentrys product suite and customer base.Having known the business and management team for over a decade we are delighted they are now part of our organisation,with a shared visi
100、on and purpose.Together,we will offer healthcare organisations innovative new ways to measurably impact operational and financial performance and generate sustainable margins that can be re-invested in providing better care for underserved communities.Following the acquisition,the Group now serves a
101、pproximately 40 percent of US hospitals and more than 10,000 clinics and retail pharmacies across all the major pharmacy brands as well as local community pharmacies and clinics.The quality and breadth of the combined data sets from both companies increases our ability to provide far-reaching action
102、able insights for better operational and strategic decisions,enabling further efficiencies in provider performance so our customers can focus on serving their communities and healthcare missions.The data will be integrated into the Trisus platform to help identify new areas of product development to
103、 support our customers.Sentry applications currently reside in modern web architecture environments and no technical integration is required,just the front end of the applications will be harmonised to create the same look and feel.We anticipate benefits of this increased scale to be seen in greater
104、 operational efficiencies across areas such as office space and future product development and provides for a considerably enlarged sales and Strategic Report:Operational and Financial Review Contd8Cranewareplc AnnualReport2021With the completion of this acquisition after the year end Sentry has not
105、 contributed to these results.Also,with the proximity to the publication of these accounts,we have yet to complete the associated acquisition accounting.However,where applicable and meaningful to the KPIs presented we have included details of Sentrys expected contribution.Associated share placing co
106、mpleted(June 2021)To partly fund the acquisition of Sentry,in June 2021,the Company completed a share placing which resulted in the allotment of 6,192,652 new Ordinary Shares at an issue price of 22.00($31.05)per share,representing approximately 23.1%of the issued share capital prior to the placing.
107、The Placing was conducted through an accelerated bookbuild process and was effected by way of a cash box structure.This structure was necessary as the Company was required,by the vendors,to reduce the execution risk of the acquisition(recognising the normal risk profile of an expected US purchaser)a
108、nd,without such certainty,we would likely have been unable to participate in the acquisition process.Whilst the Placing was not carried out on a fully pre-emptive basis,we consulted with our major shareholders prior to the Placing and working with our advisors,respected the principles of pre-emption
109、 through the allocation process.Underlying Business ModelThe new contracts we sign with our customers provide a licence for the customer to access specified products throughout their licence period.The underlying licence period of these New Sales are expected to be,on average,four years.At the end o
110、f an existing licence period,or at a mutually agreed earlier date,we look to renew these contracts with our customers.The existing contracts within Sentry are similar in their nature albeit are for a slightly shorter duration.In addition to the licence fees,Sentry can also provide a number of transa
111、ctional services to customers,throughout the life of their underlying contracts.These transactional services,whilst highly dependable,will see some variation period to period dependent on volume of transactions.Under the Groups business model,we recognise software licence revenue and any minimum pay
112、ments due from our other long term contracts evenly over the life of the underlying contract term.Transactional services are recognised as we provide the service and we are contractually able to invoice the customer.By renewing the underlying contracts,and ensuring we continue to deliver the transac
113、tional services to our customers we sustain a highly visible recurring revenue base,which means sales of new products to existing customers or sales to new hospital customers are adding to this recurring revenue.In addition to the licence revenues recognised in any year,we also expect revenue to be
114、recognised from providing services to our customers.These services are typically separately identifiable from any associated licence and as such,revenue is recognised as we deliver the service to the customer,usually on a percentage of completion basis.However,the nature and scope of these engagemen
115、ts will vary depending on both our customers needs and Financial ReviewIn a year that has been dominated by the ongoing global pandemic,we are proud of the progress that Craneware has made,whilst,at all times,focusing on delivering to our customers.Our customers are on the front line in dealing with
116、 the pandemic and supporting them has been,and will continue to be,our top priority.The role Craneware continues to play,allowing our customers to improve operational efficiency and margins so that they can continue to invest in providing quality care for their communities,has never been more import
117、ant.Through this year,the strength of the Craneware business model,its long term visible revenue,our strong balance sheet and sensible cost management whilst investing for the future have served us well.This has allowed us to continue our development of new products,further building out the depth of
118、 the Trisus platform across the Value Cycle,continue our sales momentum delivering a further increase in New Sales in the year,and see a return to growth in key financial metrics for the year.Further,post year end,through the acquisition of Sentry,we have seen a transformational change in the Groups
119、 scale and operations.During the year ended 30 June 2021,we saw significant growth in the Total Contract Value of New Sales of 40%to$42.4m(FY20:$30.4m)which combined with the total value of renewals signed in the year saw a 19%increase in the Total Value of all contracts written to$78.1m(FY20:$65.4m
120、).As a result of our business model,“sales”and“revenue”have very different meanings and are not interchangeable.With only a small proportion of the revenue resulting from the sales made in the year impacting on the current years reported revenue,the vast majority is recognised in future years,provid
121、ing further long-term visibility over future revenues,supporting our future growth.As a result,we are reporting a 6%growth in our Revenue to$75.6m(FY20:$71.5m)which has contributed to an 8%increase in Adjusted EBITDA in the period,growing to$27.1m(FY20:$25.2m).Acquisition of Sentry Data Systems,Inc.
122、On 7 June 2021 the Board announced the proposed acquisition of SDS Holdco,Inc.,the ultimate holding company of Sentry Data Systems,Inc.The acquisition was completed on 12 July 2021.The headline consideration for the acquisition of Sentry(on a cash free/debt free basis)was$400m,subject to benchmark l
123、evel of working capital and other expected adjustments.The consideration for the acquisition was satisfied by the payment of$312.5m(as adjusted)in cash and$87.5m by the issuance of 2,507,348 new ordinary shares in Craneware plc on 14 July 2021.The cash consideration was funded from a combination of
124、the Groups existing cash resources,a new secured loan of$120m and the$187.3m net proceeds of the share placing which completed in June 2021.The acquisition marks the next stage of Cranewares growth journey,as the enlarged Group now serves approximately 40 percent of US hospitals and more than 10,000
125、 clinics and retail pharmacies.The increased scale that Sentry brings will deliver greater operational efficiencies across all areas of the Group,including considerably strengthened sales and product development teams.Strategic Report:Operational and Financial Review Contd9Cranewareplc AnnualReport2
126、021*As the Group signs new customer contracts for between three to nine years,the number and value of customers contracts coming to the end of their term(“renewal”)will vary year on year.This variation,along with whether customers auto-renew on a one-year basis or renegotiate their contracts for up
127、to a further nine years,will impact the total sales value of renewals in that year.FY20FY21FY17FY18FY19010203040$mRenewalsReported RevenueFY20FY21FY17FY18FY19020406080$mNew SalesNew SalesFY20FY21FY17FY18FY19020406080$mRevenueRenewals*we reasonably expect to recognise,over the next three-year period,
128、based on sales that have already occurred.With the acquisition of Sentry,the visible revenue derived from the existing contracts has been included over the three-year period to 30 June 2024.However,as the acquisition only completed on 12th July,visible revenue is only included from this date forward
129、(i.e.FY22 includes Sentry visible revenues from 13th July 2021 to 30 June 2022).The Three-Year Revenue Visibility KPI is a forward looking KPI and therefore will always include some judgement,especially in regards to transactional revenues.To help assess this,we separately identify different categor
130、ies of revenue to better reflect the nature of these recurring revenues.This Three-Year Visible Revenue metric includes:future revenue under contract revenue generated from renewals(calculated at 100%dollar value renewal);and other recurring revenue,including transactional revenueswhich of our solut
131、ions they have contracted for.As a result,the period over which we deliver the services and consequently recognise the associated revenue will vary.Sales,Revenue and Revenue VisibilityTotal Sales,can be broken down into the total value of contracts with new customers or new products to existing cust
132、omers at some time in their underlying contract(“New Sales”)and the total value of contracts of customers renewing their existing products at the end of their current contract terms(“Renewals”).The graph below shows the total value of contracts signed in the relevant years,split between New Sales an
133、d Renewals and how these sales have translated into reported revenue in the corresponding year.As the majority of the revenue resulting from sales in any one year is recognised over future years,the results in any individual year do not fully reflect this valuable asset that is contracted,but not ye
134、t recognised.As such,the Group presents its“Revenue Visibility”.This KPI identifies revenues which Strategic Report:Operational and Financial Review Contd10Cranewareplc AnnualReport2021ContractedRenewalsOther recurring revenueThree years to 30 June 20241801601401201008060400$m130.313.813.186.357.013
135、.553.9FY22FY23FY2489.813.5Three Year Visible Revenue future revenue under contract contributing$270.5m of which$130.3m is expected to be recognised in FY22,$86.3m in FY23 and$53.9m in FY24 revenue generated from renewals contributing$160.6m;being$13.8m in FY22,$57.0m in FY23 and$89.8m in FY24 other
136、revenue identified as recurring in nature of$13.1m in FY22 and$13.5m in FY23 and FY24These future revenues,with customers continuing to renew their contracts with us,expand beyond the three-year time horizon we report on,creating a dependable base of recurring revenue.This recurring revenue provides
137、 the foundation for future financial growth as well as giving increased certainty to the Board when making the annual assessment for the Viability Statement.Gross MarginsOur gross profit margin is calculated after taking account of the incremental costs we incur to obtain the underlying contracts,in
138、cluding sales commission contract costs which are charged in line with the associated revenue recognition.The gross profit for FY21 was$70.2m(FY20:$67.0m)representing a gross margin percentage of 93%(FY20:94%).Future revenue under contract is,as the title suggests,subject to an underlying contract a
139、nd therefore when invoiced,we reasonably expect to recognise in the respective future years.Renewal revenues relate to the contracts that are coming to the end of their original contract term and will require their contracts to be renegotiated and renewed for the revenue to be recognised.To appropri
140、ately represent the quantum of revenue within this category we present the total of revenue subject to renewal(i.e.100%of dollar value).The final category other recurring revenue is revenue that we would expect to recur in the future but is monthly or transactional in its nature.Here,we estimate bas
141、ed on past performance a level of revenue we would reasonably expect to recognise associated to the service provided.No growth from new sales is assumed to occur when making these estimates.The Groups total visible revenue for the three years ended 30 June 2022,2023 and 2024,including visible revenu
142、e from Sentry from the date of its acquisition,identifies$471.2m of revenue(FY20 same 3 year period:$196.2m)which we reasonably expect to benefit the Group in this next three-year period.This visible revenue breaks down as follows:Strategic Report:Operational and Financial Review Contd11Cranewareplc
143、 AnnualReport2021In the year total costs of$6.5m have been identified as exceptional.These include the costs associated with the acquisition of Sentry and its associated share placing as well as the costs associated with the aborted share placing in connection with a different acquisition target in
144、August 2020.As such these costs were adjusted from earnings in presenting Adjusted EBITDA in the year.No costs were identified as exceptional in the prior year.Adjusted EBITDA has grown in the year to$27.1m(FY20:$25.2m)an increase of 8%.This reflects an Adjusted EBITDA margin of 36%(FY20:35%).This i
145、s consistent with the Groups continued approach to making investments in line with the revenue growth and prudent cost management.Primarily as a result of the costs detailed above as exceptional and an increase in the IFRS 2 share-based payment charge,profit before taxation reported in the year has
146、reduced to$13.2m(FY20:$19.3m).The increase in the share-based payment charge included charges from Long-Term Incentive Grants made during the period,an adjustment to retention rates and an increased accrual for estimated employer National Insurance contributions on the unexercised options granted un
147、der the 2007 Share Option Plan.TaxationThe Group generates profits in both the UK and the US.The overall levels are determined by both the proportion of sales in the year and the level of professional services income recognised.The Groups effective tax rate remains dependent on the applicable tax ra
148、tes in these respective jurisdictions.In the current year the effective tax rate has been positively affected by the finalisation of R&D tax relief claims in respect to the prior two years of$1.6m(FY20:$0.3m)and the R&D tax relief provision for the current year of$0.7m(FY20:$0.5m).In addition,as a r
149、esult of UK Corporation tax rates increasing to 25%from 1 April 2023,closing UK deferred tax assets and liabilities were revalued which has reduced the current year tax charge by$0.5m(FY20:$nil)in accordance with the now enacted rate.As such the current year effective tax rate is 2%(FY20:13%).EPSReg
150、arding EPS,the Group again presents an Alternative Performance Measure of Adjusted EPS,to provide consistency to other listed companies and take account of certain one-off events.Both Basic and Diluted Adjusted EPS are calculated excluding costs incurred as a result of acquisition and share related
151、activities,being$5.6m(tax adjusted)in the year(FY20:$nil)and in the prior year amortisation of acquired intangibles of$0.7m.Adjusted EPS has seen the benefit of the increased levels of Adjusted EBITDA combined with the effective tax rate reported above,partially offset by an increase in both the amo
152、rtisation and share based payment charges,and as such has increased 6%to$0.690(FY20:$0.654)and adjusted diluted EPS has increased to$0.681(FY20:$0.644).Basic EPS in the period reduced to$0.481(FY20:$0.628)and Diluted EPS reduced to$0.475(FY20:$0.619)primarily as a result of the exceptional items not
153、ed above.Operating ExpensesThe increase in net operating expenses(to Adjusted EBITDA)to$43.1m(FY20:$41.8m)reflects continued investment in our Research&Development spend combined with prudent cost control across the rest of the business.We have remained highly cash generative and as a result we have
154、 continued to use our cash reserves(after returning funds to shareholders via dividends)to invest in our future.Product innovation and enhancement continue to be core to this future and our ability to achieve our potential.As such,alongside our acquisition activities in the year,we have continued to
155、 invest significant resource in R&D as we build out the Trisus platform and its portfolio of products.As a result of this investment,the total cost of development in the year was$24.7m(FY20:$21.6m),a 14%increase which is reflective of the opportunities in the market for our products.We continue to c
156、apitalise only the costs that relate to projects that bring future economic benefit to the Group.As a result,the total amount capitalised in the year reduced from 43%of total R&D spend in FY20 to 41%in the current year,being$10.1m(FY20:$9.3m).The amounts we capitalise represent the cash reserves we
157、have utilised in the year,to invest in our future.This is an efficient and cost-effective way to further build out our Value Cycle strategy.We expect to see both the levels of development expense and capitalisation to continue at the same proportion of revenue in future years as we progress with bui
158、lding out this solution set.As specific products are made available to relevant customers,the associated amounts capitalised are charged to the Groups income statement over their estimated useful economic life,thereby correctly matching costs and the resulting revenues.Net Impairment Charge on Finan
159、cial and Contract AssetsThis relates to the movement in the provision for the impairment of trade receivables in the year(or bad debts),being$495,000(FY20:$529,000).The nature of the market the Group serves and the SaaS based business model limit the Groups exposure in this regard,but are required t
160、o be shown separately on the face of the Consolidated Statement of Comprehensive Income.Adjusted EBITDA and Profit Before Taxation To supplement the financial measures defined under IFRS the Group presents certain non-GAAP(alternative)performance measures.We believe the use and calculation of these
161、measures are consistent with other similar listed companies and are frequently used by analysts,investors and other interested parties in their research.The Group use these adjusted measures in its operational and financial decision-making as it excludes certain one-off items,allowing focus on what
162、the Group regards as a more reliable indicator of the underlying operating performance.Adjusted earnings represent operating profits excluding costs incurred as a result of acquisition and share related activities(if applicable in the year),share related costs including IFRS 2 share-based payments c
163、harge,interest,depreciation and amortisation(“Adjusted EBITDA”).Strategic Report:Operational and Financial Review Contd12Cranewareplc AnnualReport2021Sterling to US dollar exchange rate,and where appropriate consider hedging strategies.The average exchange rate throughout the year being$1.3466 as co
164、mpared to$1.2598 in the prior year.Audit TenderDuring the year the Audit Committee conducted an audit tender process for the Groups External Audit.As part of this process a number of audit firms were invited to tender.Details of the process followed and the selection criteria are provided in the Cor
165、porate Governance Report on page 46.As a result of this process the Board has approved PricewaterhouseCoopers LLP for recommendation to shareholders,for re-appointment as auditors,at the Companys Annual General Meeting to be held in November 2021.DividendIn proposing a final dividend,the Board has c
166、arefully considered a number of factors including the prevailing macroeconomic effects of the COVID-19 pandemic,the Groups trading performance,our current and future cash generation especially in light of the Sentry acquisition and our continued desire to recognise the support our shareholders provi
167、de.After carefully weighing up these factors,the Board proposes a final dividend of 15.5p(21.47 cents)per share giving a total dividend for the year of 27.5p(38.10 cents)per share(FY20:26.5p(32.60 cents)per share),an increase of 4%.Subject to approval at the Annual General Meeting,the final dividend
168、 will be paid on 21 December 2021 to shareholders on the register as at 26 November 2021,with a corresponding ex-Dividend date of 25 November 2021.Outlook The successful completion of the acquisition of Sentry Data Systems following the end of the year marks a transformational point in our journey,c
169、onsiderably expanding our customer base,data sets,product offering and market presence.Together,we will offer healthcare organisations innovative new ways to measurably improve operational and financial performance to generate sustainable margins that they can re-invest to provide better care for th
170、ose underserved communities.With a strong balance sheet,high levels of recurring revenues,high customer retention rates and visible revenue in the next three years of$471.2m,we have a strong financial foundation from which to accelerate growth and investment to fulfil our potential,thereby increasin
171、g future shareholder value.We have enjoyed early sales momentum across the now enlarged Group and with our expanded opportunity we look to the future with considerable excitement and confidence as we work with the Sentry team to transform the business of US healthcare.Keith Neilson Chief Executive O
172、fficer 20 September 2021Craig Preston Chief Financial Officer 20 September 2021Cash and Bank FacilitiesCash generation and a strong balance sheet have always been a focus of the Group.Our business model provides the basis for high levels of cash generation and we continue to monitor the quality of o
173、ur earnings through Operating Cash Conversion,this being our ability to convert our Adjusted EBITDA to“cash generated from operations”(as detailed in the cash flow statement).We achieved strong Operating Cash Conversion of 99%in the year(FY20:92%).As a result,we are able to continue to invest in our
174、 future and return funds to our shareholders via dividends,returning$9.7m in the current year(FY20:$9.1m).As detailed above,to fund the acquisition of Sentry$187.3m(net)was raised via a share placing in June.As the acquisition did not complete until post year end,these amounts were held as cash rese
175、rves of the Group.As a result,cash reserves at the year-end were$235.6m(FY20:$47.9m)of which$48.3m represents operating cash reserves.Also,as part of the funding for the acquisition of Sentry,the Group entered into a Debt Facility with Silicon Valley Bank to provide up to a further$140m of secured f
176、unding.As the acquisition did not complete until after that year end,no draw down on this facility had taken place and as such any arrangement and other related fees prepaid are recorded in Trade and Other receivables.Balance SheetThe Group maintains a strong balance sheet.Intangible assets have inc
177、reased by$6.3m to$43.1m(FY20:$36.8m)primarily as a result of capitalised development costs in the year net of the amortisation charged.The level of trade and other receivables has decreased in comparison to the prior year.This is a result of the factors identified in the prior year that impacted our
178、 cash collections now having returned to a more normal position.Deferred income levels reflect the amounts of the revenue under contract that we have invoiced but have yet to recognise as revenue.This balance is a subset of the total visible revenue we describe above and reflected through our three-
179、year visible revenue metric.Deferred income,accrued income and the prepayment of sales commissions all arise as a result of our Annuity SaaS business model described above and we will always expect them to be part of our balance sheet.They arise where the cash profile of our contracts does not exact
180、ly match how revenue and related expenses are recognised in the Statement of Comprehensive Income.Overall,levels of deferred income are significantly more than any accrued income and the prepayment of sales commissions,we therefore remain cash flow positive in regards to how we account for our contr
181、acts.CurrencyThe functional currency for the Group,and cash reserves,is US dollars.Whilst the majority of our cost base is US-located and therefore US dollar denominated,we have approximately one quarter of the cost base situated in the UK,relating primarily to our UK employees which is therefore de
182、nominated in Sterling.As a result,we continue to closely monitor the Key Performance Indicators and Principal Risks and Uncertainties13Cranewareplc AnnualReport2021The Group continues to convert very high levels of the Adjusted EBITDA reported in the year into operating cash flows which,having retur
183、ned$9.7m to shareholders by dividend during the year and raised$187.3m via share placing,has resulted in cash balances of$235.6m at 30 June 2021.Operating cash of$48.3m at 30 June 2021 excludes the funds raised via the share placing.Overall operating cash conversion,at 99%for the year ended 30 June
184、2021,is above the prior year of 92%.Cash20212020Total Cash$235.6m$47.9mOperating Cash$48.3m$47.9mKey Performance Indicator ReviewRevenue Growth20212020Revenue$75.6m$71.5mGrowth6%0%Through the Groups Annuity SaaS revenue recognition model,underlying sales levels in the current year combine with prior
185、 years sales and continued high levels of customer retention,to increase the recurring revenue reported each year.The long-term nature of our contracts supports sustainable growth with the majority of revenue resulting from current year sales being recognised in future periods.Three Year Revenue Vis
186、ibility20212020Three Year Revenue Visibility$471.2m$196.2mThe Groups revenue recognition model means the full benefit of current years sales are not reflected in the current year financial statements.Instead,the vast majority of any new sales adds to the growth in the underlying annuity of recurring
187、 revenue.This is demonstrated through the Groups Three Year Revenue Visibility KPI.This metric compares the growth in the three years contracted revenue,revenue subject to renewal and other recurring revenue,for the same three year period to 30 June 2024.Full details of how this is calculated are de
188、tailed in the financial review section of the Strategic Report.The KPI for 2021 includes the visible revenue for Sentry from 13 July 2021 following its acquisition by the Group as detailed in Note 25.Adjusted EBITDA Growth20212020Adjusted EBITDA$27.1m$25.2mGrowth8%5%We take a measured approach to ou
189、r investment,ensuring to invest to support the future growth of the Group.The continued revenue growth has allowed us to both continue and in certain areas accelerate this investment whilst delivering Adjusted EBITDA growth.By taking this approach,we aim to release additional investment,in line with
190、 revenue growth,with the focus on delivering profitable growth to all stakeholders.Adjusted EPS20212020Adjusted EPS69.0 cents65.4 centsGrowth6%3%Adjusted EPS growth demonstrates the Groups overall profitability,adjusted for exceptional items,after taking into account the taxation in the year and any
191、 changes in share capital.The Group generates profits in both the UK and the US.The Groups effective tax rate remains dependent on the applicable tax rates in each respective jurisdiction.Total Sales20212020Total Sales$78.1m$65.4mTotal Sales represents to the total value of contracts signed in the y
192、ear.As the Group signs new customer contracts for between three to nine years,the number and value of customers contracts coming to the end of their term(“renewal”)will vary year on year.This variation,along with whether customers auto-renew on a one year basis or renegotiate their contracts for up
193、to a further nine years,will impact the total sales value of renewals in that year.The key performance indicators listed below are focused on growing our revenues and improving our revenue mix as well as improving earnings growth for our shareholders and generating sustainable cashflows.Detailed exp
194、lanation of the movements is contained in the Financial Review on pages 8 to 12.Strategic Report:Key Performance Indicators and Principal Risks and Uncertainties Contd14Cranewareplc AnnualReport2021Risk Management,Principal Risks and Uncertainties To deliver continued sustainable growth,the Group re
195、cognises the need to minimise the likelihood and impact of key risks.These risks are both general in nature i.e.,business risks faced by all businesses,and more specific to the Group and the market in which it operates.Our approach to risk management is a key consideration to how we deliver long-ter
196、m stakeholder value whilst protecting our business,people,assets,capital and reputation.The Board is very much aware that as a public company,reputational damage is a risk and as such a key concern.Whilst the risks outlined in this report do not specifically detail the risk from reputational damage,
197、the potential effects to our reputation are not under-estimated by the Board.Risk ManagementThe Directors have carried out a robust assessment of the principal and emerging risks facing the Group,including those that would threaten its business model,future performance,solvency and liquidity.The Gro
198、up maintains its internal risk register that forms the foundation of the Board and the Audit Committee review process.Executive Directors and senior management meet to review both the risks facing the business and the controls established to minimise those risks and their effectiveness in operation
199、on an ongoing basis.The aim of these reviews is to provide reasonable assurance that material risks and problems are identified and appropriate action taken at an early stage.The implications of the COVID-19 pandemic have been at the forefront of the risk management process during the year and in th
200、e prior financial year.While there remains a level of uncertainty,management has been considering and evaluating the risk to the Groups people,customers,business and operations and has put in place mitigation wherever possible;further details are provided in the section below.The Operations Board is
201、 chaired by the Chief Executive Officer and also comprises the Chief Financial Officer and five further members of the Senior Management Team.The risk review is exercised through the monthly management reports and Operations Board meetings and,due to the importance of this topic,there is a sub-commi
202、ttee of the Operations Board(the Governance Committee,chaired by the Chief Financial Officer)to ensure there is specific focus on risk review and risk management.The purpose of the Governance Committee is to function as a sub-committee of the Operations Board focused on Corporate Governance responsi
203、bilities and risk management.The Groups risk and compliance function was expanded during the year.For each risk identified,the control strategy and who is accountable for discharging that strategy is identified and documented in the meeting minutes.During monthly Operations Board meetings,material e
204、merging risks are reviewed with discussion concerning actions to reduce or monitor Group exposure.In this way,risks are reviewed and updated monthly.The Group also has a Security Council,chaired by the Chief Information Officer,which meets weekly and reports into the Governance Committee.The purpose
205、 of the Security Council is to assess current technology risks,approval and implementation of mitigation plans and to inform the Chief Information Officer of future strategy around this key business area.In addition,the Group has a Health&Safety Committee which is also under the supervision of the G
206、overnance Committee.During the year ended 30 June 2021,as was the case during the prior financial year,the Governance Committee(chaired by the Chief Financial Officer and joined by the CEO),had the responsibility of being the COVID-19 response Committee.The Corporate Governance Report on pages 39 to
207、 47 includes an overview of the Groups internal control systems.Risk AppetiteThe Groups risk appetite is reflected in the way it assesses,scores,ranks and then manages individual risks.For each identified risk it is characterised,estimated how often the specified events could occur and a judgement i
208、s made regarding the magnitude of their likely consequences.For each identified risk,the risk management priorities are decided by evaluating and comparing the level of risk.This allows each risk to be quantified as to the:effect of the risk and its impact;likelihood of the risk occurring;considerat
209、ion of any advantage associated with the risk;action to avoid or mitigate the risk;action to take if the risk occurs.Principal Risks and Uncertainties The risks outlined here are those principal risks and uncertainties that are material to the Group.They do not include all risks associated with the
210、Group and are not set out in any order of priority.For each risk an indication is also provided for the estimated trend in the risk exposure being increased,decreased or relatively unchanged compared to the prior year.The principal financial risks are detailed in Note 3 to the financial statements.H
211、ow the Board determines and manages risks is detailed in the Corporate Governance report on pages 39 to 47.In summary,and as explained in the Operational Review section of this Strategic Report,the US healthcare market is not immune to the macro-economic climate and,with the increasing focus and req
212、uirements of the evolving healthcare marketplace,the Group expects the market to continue to be competitive.The Group aims to remain at the forefront of product innovation and delivery,through a combination of in-house development and specific acquisition opportunities.This requires the recruitment,
213、retention,and reward of skilled employees,alongside responsiveness to changes and the opportunities that result,as they arise.The acquisition of Sentry both presents the Group with increased opportunities as well as changes in the risk dynamics which have to be carefully assessed and monitored in th
214、e year ahead.COVID-19The Strategic Report on pages 5 to 12 acknowledges the impact COVID-19 has on our customers and their operations.It also details the financial and operational impact on Craneware.Whilst as a business Craneware continues to be relatively insulated from the direct impacts of the p
215、andemic,our customers are on the front-line.We have continued to support our US hospital customers to assist them,where we can,with their challenges and adding value by ensuring they can maximise their reimbursements and maintain their financial stability.This in turn gives them the ability to bette
216、r serve their communities.Strategic Report:Key Performance Indicators and Principal Risks and Uncertainties Contd15Cranewareplc AnnualReport2021Since mid-March 2020 all of Cranewares office-based staff have been working remotely from home in line with Government guidelines.This approach was driven b
217、y the desire to protect and safeguard the well-being and health of our workforce and allowing the continued support to our customers as they faced the challenge of dealing with COVID-19 patients in their hospitals.The Governance Committee continued to have responsibility for being the COVID-19 respo
218、nse Committee throughout the financial year ended 30 June 2021,with the remit to enlist the assistance of colleagues with specific industry knowledge and expertise to assist the ongoing task of monitoring and information sharing to both employees and customers in the UK and in the US.The COVID-19 re
219、sponse committee facilitate regular update calls to inform all employees of the changes in legislation in both jurisdictions and any policy changes being implemented by Craneware.These sessions were informative and also provided time for questions and answers to allow any concerns and queries to be
220、addressed.All new updates are conducted as and when significant changes occur.A dedicated section on the Groups intranet continues to be maintained with up to date information and the five stages of COVID-19 indicator.Operational efforts have been designed with employee safety as a priority.While al
221、l office-based employees continued to work from home in the financial year,various programmes were provided to ensure their safety and wellbeing,including an increased emphasis on mental health awareness and the training of mental health first aiders within the organisation.Employees were further su
222、pported through this period with the ability to work reduced hours to fit in with their personal circumstances.Climate ChangeClimate change has both immediate effects and progressive,long-term effects on the risk profile of all businesses.In the short-term there is an increasing frequency of extreme
223、 weather events(wind/rain/flood);this may lead to significant changes in certain costs,including but not limited to taxation e.g.on emissions.The nature of Cranewares operations,i.e.not manufacturing or transporting goods,means its environmental impact is relatively low compared with other sectors a
224、nd our overall risk from climate change is assessed as low.However,all businesses,including Craneware,must recognise the importance of responding appropriately and reducing their contribution to global climate change.In regard to specific risks to Craneware;existing resilience plans include mitigati
225、on strategies for extreme weather events;energy costs are a small proportion of its costs and likely regulatory interventions are seen as manageable;and COVID-19 has clearly demonstrated our ability to work together using video conferencing,thereby reducing our travel requirements.The Group also rem
226、ains cognisant of the significant reputational risk if it does not continue to respond appropriately to global climate change.Data and cyber securityTrend since last year:IncreasedIssue:Security of customer,commercial,and personal data poses increasing risks to all businesses,especially against a ba
227、ckdrop of increasingly complex regulatory environments and safeguards over personal and patient data.The continually increasing instances of cyber and data-related crime presents a significant challenge in terms of securing data and systems against attack.It is important to continually reinforce the
228、 level of awareness of these risks across all Company personnel.While its important to have up to date policies and procedures in place,human error and increasing sophistication of the potential attackers will always pose a risk to organisations.Mitigating Actions:Whilst it is impossible to complete
229、ly eliminate data and cyber security risk,it is clear that effective mitigation now goes beyond building and operating security controls.The Group continues to invest in strict physical and data security systems and protocols with multiple layers of defences,including data loss prevention systems,in
230、ternal and external threat monitoring.We deploy comprehensive auditing of our controls and processes targeted in these areas.The Group has a Security Council,chaired by the Chief Information Officer,which assesses current technology risks,approval and implementation of mitigation plans as well as to
231、 inform the Chief Information Officer of future strategy around this key business area.The Group also recognises and supports(including through ongoing employee training and applicable policies and procedures)a sustained evolution of culture within the organisation that embeds security across the bu
232、siness.Along that vein,as many studies suggest that employees and contractors are the most common cause of data breaches,with phishing attacks being the predominant cause,the Group requires mandatory data security training to be completed by all employees on at least an annual basis and continues to
233、 develop and invest in additional training.The effectiveness of this training is regularly tested and where any shortcomings are identified employees are required to reperform and supplement their mandatory training.In view of the importance of the procedures,security,regulation and controls around
234、Cranewares solutions and customer data,Craneware met the requirements for and was awarded the HITRUST CSF certification.Health Information Trust Alliance(HITRUST Alliance)is a collaboration with healthcare,technology and information security organisations which develops,maintains and provides broad
235、access to its widely adopted common risk and compliance management and de-identification frameworks;related assessment and assurance methodologies;and initiatives advancing cyber sharing,analysis and resilience.HITRUST has established a common security framework(CSF)to address the multitude of secur
236、ity,privacy and regulatory challenges facing organisations.The scope of the HITRUST CSFs requirements is wide and requires a very high standard of data security arrangements as these have been set in the context of the accreditation being relevant to US healthcare providers with handling sensitive d
237、ata(Protected Health Information)and impacts in some way all areas of the business(at least in respect of the required enhancement to the Group-wide IT and data security policies).This serves to inform IT Security roadmaps and significant investments with continued compliance being an ongoing a focu
238、s.Strategic Report:Key Performance Indicators and Principal Risks and Uncertainties Contd16Cranewareplc AnnualReport2021US Healthcare:Complexity,Evolution and ReformTrend since last year:No changeIssue:The US healthcare industry,already a complex and highly regulated environment,continues to evolve,
239、with a drive for increased value from healthcare spend and a shift towards consumerisation.The US healthcare market is subject to continual change and as such could impact the Groups market opportunity.Mitigating Actions:The Group has taken steps to ensure it stays at the forefront of how the indust
240、ry is interpreting current proposals and actions they are taking.It has and it continues to develop significant industry expertise at all levels of management including the Board of Directors.It actively promotes developing further experience throughout the wider organisation by,amongst other things
241、:key hires adding to the industry expertise across the Group,both at operational and strategic levels;having independent industry experts attend and speak at internal and external Company events;regular attendance by senior management at healthcare forums and industry education events;and customer f
242、orums.The Groups Value Cycle strategy and the ongoing expansion of the Trisus platform strengthens our position as a trusted financial performance partner to hospitals.In addition,the Group continues to innovate and develop further new products to meet evolving market needs,such as the ongoing devel
243、opment of the Groups new product in the cost analytics area.These strategies,in addition to the customer engagement activities outlined on page 24,keep the Group at the forefront of industry developments.Regulatory EnvironmentTrend since last year:IncreasedIssue:The Group operates in an increasingly
244、 complex and heavily regulated market environment.This includes very specific requirements in dealing with,for example,data privacy,security,labour/employment,anti-kickback statutes.This risk is also driven by new state-level data privacy legislation which is coming into play on a rolling basis acro
245、ss the US,in addition to existing GDPR and HIPAA regulations.The Group operates in both the UK and the US and is therefore exposed to the changes in the political and economic environments of both jurisdictions.Mitigating Actions:The Group has a Governance Committee,comprised of the Chief Informatio
246、n Officer,Chief People Officer,Chief Financial Officer,and the Chief Legal Officer to oversee activities and concerns pertaining to the strict regulatory environment.All employees and contractors are required to undertake regular mandatory training in key topics.The Chief Legal Officer is certified
247、in privacy law in the US and the UK.In addition to utilising external experts in the relevant areas,senior management regularly attend educational events and forums to keep up to date with evolving regulations.Political and Macroeconomic changesTrend since last year:No changeIssue:The Group has sign
248、ificant operations in both the UK and the US and is therefore exposed to the changes in the political and economic environments of both.This includes the implications of Brexit and any changes in freedom of movement and international trade.Mitigating Actions:The Group has experienced Board members a
249、nd senior management in both countries.The Groups operations were,until July 2021,evenly balanced between the two,contributing positively to both economies.Since the completion of the acquisition of Sentry in July,the Group now has a larger presence in the US.Globally there is a restricted supply of
250、 qualified personnel within the technology sector.Political uncertainty in the world can exacerbate this situation within specific geographies.To ensure the ongoing availability of qualified personnel,the Group continues to support training programs both internally and externally as well as develop
251、third party partnerships.The current multi-jurisdictional operations of the business substantially mitigate the Groups exposure to foreign exchange rates and risk to cross border trade which can be volatile in times of uncertainty.The Group continues to monitor emerging news and trends to stay alert
252、 to any potential future impacts.Intellectual Property RiskTrend since last year:No changeIssue:Failure to protect,register and enforce(if appropriate)the Groups Intellectual Property Rights could materially impact the Groups future performance.The use of third party contractors within the Groups so
253、ftware development organisation as well as increasing numbers of customers using outsourced partners to operate parts of their finance departments,results in a larger number of third parties having access to the Groups Intellectual Property.Mitigating Actions:The Group will continue to register its
254、trademarks and protect access to its confidential information,as appropriate.The Group continues to include appropriate legal protections in its contractual relations with customers,suppliers,and employees.The Group would vigorously defend itself against a third-party claim should any arise.The Grou
255、p also has in place strict physical and data security processes and encryption to protect its intellectual property.Strategic Report:Key Performance Indicators and Principal Risks and Uncertainties Contd17Cranewareplc AnnualReport2021Market and Customer ConsolidationTrend since last year:No changeIs
256、sue:The evolving market in US Healthcare continues to place significant pressure on Healthcare providers,which is resulting in ongoing market consolidation.As a result,the Groups market is increasingly dominated by larger hospital networks.Failure to enhance products,ensure scalability or add to the
257、 current product suite could significantly limit the Groups market opportunity and leave it unable to meet its customers evolving needs.Mitigating Actions:The Groups Value Cycle strategy and Trisus platform,combined with the ongoing investment in the product suite,positions the Group to provide scal
258、able solutions to US Healthcare providers of all sizes.Competitive LandscapeTrend since last year:No changeIssue:New entrants to the market or increased competition from existing competitors could significantly impact the Groups market opportunityMitigating Actions:The Group continually monitors its
259、 competitive landscape,including both existing and potential new market entrants.Significant barriers to entry continue to exist,including but not limited to the significant data content built over the Groups history that exists within its products.The Group continues to expand and develop its produ
260、ct portfolio and to ensure its products are platform agnostic and actively seeks partnerships with other healthcare IT vendors.Acquisition RiskTrend since last year:No changeIssue:The Group has a stated acquisition strategy.Any acquisition carries with it an inherent risk,including failure to identi
261、fy material matters that could adversely affect future Group performance.Mitigating Actions:The Group and Board members individually have relevant experience in regard to completing acquisitions and this experience has been added to in recent years through key appointments to the Operations Board.In
262、 addition,and where appropriate,the Board appoints independent professional advisors to assist in the consideration of potential acquisitions and to assist management in the due diligence process.The integration of the Sentry business,following its acquisition by Craneware in July 2021,is being mana
263、ged on a phased basis,using established change management controls and strong leadership support across the organisation.Emerging RisksIn addition to known risks,we are consistently reviewing and re-assessing other emerging risks and the need for mitigation,as well as reporting to the Board,as part
264、of our existing risk management processes.These processes include the identification of relevant internal and external factors and are designed to capture those emerging risks which are current and those that will impact future periods.Viability StatementIn accordance with the UK Corporate Governanc
265、e Code,the Directors have considered the viability of the Group over the three year period from 30 June 2021.Considerations that impact this assessment include the Groups current financial position,including the addition of the bank facility and other available financial resources,the Groups Annuity
266、 SaaS business model as outlined within the Strategic Report,including Revenue Visibility,the Groups strategic initiatives,the financial forecasts,the Groups cost base and annual forecast.In the current year this assessment has also included consideration of the continuing impact of COVID-19 on viab
267、ility.The impact continues to be largely a lengthening of sales cycles including renewals and associated upsell and cross sell,as well as,the slowing of cash collection from certain individual customers.In addition,the Directors assessed the current banking facilities and the Groups ability to satis
268、fy the terms and covenants of newly added loan agreements,effective from July 2021.The Directors also considered several other factors including the Groups risk management and internal control effectiveness and the principal risks and uncertainties and their likelihood of occurrence within the perio
269、d of assessment.The Directors consider that three years is an appropriate period for this assessment as it corresponds with the Three Year Revenue Visibility key performance indicator,as explained in the Strategic Report and the strategic planning horizon.The Annuity SaaS business model with its und
270、erlying long-term contracts(as described earlier in the Strategic Report),high levels of associated cash generation and long-term focus on customer success provides a foundation of revenue for future years.This foundation of contracted revenue forms the basis of the scenarios considered by the Direc
271、tors in making this assessment,including a scenario which envisages no revenue growth.The Directors confirm that through making sensible changes to the discretionary cash requirements,they have a reasonable expectation that the Group will be able to withstand the impact of this adverse scenario,shou
272、ld this occur during the three-year assessment period.The Directors have therefore considered,in making this assessment,the Groups current financial position and future prospects and have a reasonable expectation that the Group will be able to continue in operation and meet its liabilities as they f
273、all due over the three year period from 30 June 2021.However,future assessments of the Groups prospects are naturally subject to uncertainty that increases with time and therefore future performance cannot be guaranteed.Strategic Report:Strategic Report:Section 172(1)Statement18Cranewareplc AnnualRe
274、port2021The Directors consider,both individually and collectively,that they have taken these factors into account when exercising their duty to promote the success of the Group and of the Company during the year.In addition,more information is provided in this annual report relating to matters relev
275、ant to the section 172(1)statement in the following pages:Section 172(1)FactorExamplesFurther information on page(s)Likely consequences of any decision in the long term Cranewares aim,driven by its purpose,of generating long term value for its stakeholders through its business model and strategy5 to
276、 17Interests of the Companys employees Employee engagement and communication Employee wellness programmes Craneware Spaces 22 to 24,27 and 28Fostering business relationships with suppliers,customers and others Stakeholder engagement activities24 to 26,36 and 37Impact of operations on the community a
277、nd the environment Craneware Cares initiatives Consideration of Environmental,Social and Governance matters23,25 and 26,27 to 29,36Maintaining a reputation for high standards of business conduct The promotion of responsible business operations underpinned by Cranewares Framework,purpose and values37
278、 and 39 to 47Acting fairly as between members of the company Shareholder engagement25,37,43 and 44In discharging their section 172(1)duty,the Directors have regard for these factors and take them into consideration when making decisions.Induction materials provided on appointment include an explanat
279、ion of Directors duties,and the Board is regularly reminded of their duties.Our key stakeholders have an important role to play in the successful operation of our business and our Directors are fully aware of their responsibilities to the Companys stakeholders under Section 172(1)and take their resp
280、onsibilities seriously.The Directors have oversight of stakeholder matters and the Board factors the needs and concerns of the Companys stakeholders into its discussions and decisions in accordance with section172(1).These responsibilities are embedded in our culture,our values and our purpose.Our p
281、urpose,business model,strategy and Board operations are focused on delivering long-term benefits for all of our stakeholders while maintaining a high standard of ethical business conduct.The Board,led by the Chairman,ensures that its processes have regard for key stakeholders and that there is suffi
282、cient time,information and understanding to properly take into account their interests when making decisions and considering their long-term implications.The Board recognises that every decision it makes will not always result in a positive outcome for each of the Groups stakeholders,but it is impor
283、tant to ensure they are all treated consistently and fairly.By considering the Groups purpose and values,together with its strategic priorities and having a process in place for decision-making the Board does,however,aim to make sure that its decisions are consistent and aligned.By understanding our
284、 stakeholders,the Directors can factor into Board discussions the potential impact of decisions on relevant stakeholder groups and consider stakeholder needs and concerns,in accordance with section 172(1)of the Companies Act 2006.Details of the Groups key stakeholders and how we engage with them are
285、 set out on pages 22 to 26.In accordance with the Companies Act 2006,each director of a company has a duty to promote the success of the company.Section 172(1)(a)to(f)of the Companies Act 2006(s172(1)requires a director of a company to act in the way he/she considers,in good faith,would be most like
286、ly to promote the success of the company for the benefit of its members as a whole and,in doing so have regard(amongst other matters)to:a.the likely consequences of any decision in the long-term;b.the interests of the companys employees;c.the need to foster the companys business relationships with s
287、uppliers,customers and others;d.the impact of the companys operations on the community and the environment;e.the desirability of the company maintaining a reputation for high standards of business conduct;andf.the need to act fairly as between members of the company.This statement intends to set out
288、 how the Directors,both individually and collectively,have had regard to the following factors when undertaking their duties during the year ended 30 June 2021.Strategic Report:Section 172(1)Statement Contd19Cranewareplc AnnualReport2021Principal decisions/eventsActions and impactKey Stakeholder gro
289、up(s)affectedCOVID-19 responseWhilst as a business Craneware continues to be relatively insulated from the direct impacts of the COVID-19 pandemic,our customers have and continue to be on the front-line.Supporting our customers and the phenomenal work their teams continue to provide has been,and wil
290、l continue to be,Cranewares top priority through these times.We have continued to support to our US healthcare customers to assist them,where we can,with their challenges and adding value by ensuring they can maximise their reimbursements and maintain their financial stability.This in turn gives the
291、m the ability to better serve their communities.Details of one initiative during this year,Trisus Pricing Transparency,is outlined below.Further details of actions in response to the COVID-19 pandemic are on pages 14 and 15.The health,safety and well-being of our employees is a primary focus of the
292、Board and senior management in response to the pandemic.This focus had to be balanced with maintaining excellent levels of service to our customers.In 2020,Craneware instigated an immediate response,focusing primarily on both employees and customers,by putting measures in place to assist and allevia
293、te issues raised by the significantly challenging situation facing our customers and the restrictions in response to the pandemic imposed in both the UK and the US.Throughout 2021 all office-based employees continued to work from home and the safety and wellbeing of colleagues was,and remains,a cons
294、tant significant focus for the Board and the senior management team.The Governance Committee chaired by the Chief Financial Officer and joined by the Chief Executive Officer,was given the responsibility,from 2020,of being the COVID-19 response Committee.Regular updates continue to be provided from t
295、he Committee to the Board of Directors of the Company.Regular Q&A sessions,conducted by the COVID-19 Response Committee by virtual meetings,provided a forum for employees to receive updates,ask questions and raise concerns.A dedicated section on the Groups intranet continues to be maintained by the
296、Committee with up to date information.The Directors maintained an ongoing dialogue with shareholders throughout the period.The Trading Update published on 8 July 2020 and then the Annual Report 2020 included an explanation of the impact,as assessed by the Board at that time,of the pandemic on the Gr
297、oup.This assessment was updated again in the trading update published on 20 January 2021 and in the interim report for the half year to 31 December 2020.During the year ended 30 June 2021(as was the case in the prior financial year),notwithstanding the challenges of the COVID-19 pandemic,the Group r
298、etained all employee positions and maintained employee remuneration at all levels across the Group.The Group was able to do this through its own resources and chose to utilise only a minimal amount of COVID-19 related UK or US government support.The Group has continued to pay suppliers in accordance
299、 with agreed terms and has not sought to delay or refuse payment of valid invoices.EmployeesCustomersShareholdersCommunityGovernmentSuppliersTrisus Pricing Transparency(TPT):a free-to-use applicationIn October 2020,Craneware announced the availability of Trisus Pricing Transparency(TPT)to all US hea
300、lthcare providers.This no cost Trisus solution was developed to enable organisations not only to meet CMS Pricing Transparency Final Rule requirements,which came into effect in January 2021,but ensure that organisations pricing data is most accurately represented for patients on an ongoing basis on
301、the new Craneware Patient portal allowing individuals to shop for their healthcare needs.TPT identifies a hospital providers top 300 shoppable services being the bundles of care most frequently delivered to patients and recommends which services to publish across a variety of payors,meeting and goin
302、g beyond the needs of the regulation.These insights allow hospitals to make valuable business decisions,inform the overall pricing strategy of the hospital,monitor patient search behaviour,and rebalance pricing strategies to ensure compliance and market competitiveness while addressing the pressing
303、problem of transparency of cost for potential patients.CustomersThe following table summarises some of the significant decisions made by the Board during the year ended 30 June 2021 which demonstrate the way in which the Board has exercised their section 172(1)duty and the stakeholder group(s)impact
304、ed by these decisions.Strategic Report:Section 172(1)Statement Contd20Cranewareplc AnnualReport2021Principal decisions/eventsActions and impactKey Stakeholder group(s)affectedDividend Policy(interim dividend paid and proposed final dividend for year ended 30 June 2021)The Board considered the curren
305、t and future liquidity and financial position of the business and potential impact on dividend policy,particularly in view of the prevailing macroeconomic effects of the COVID-19 pandemic.Craneware reported positive financial results for the half year to 31 December 2020 and continued to maintain he
306、althy cash reserves,despite the macroeconomic uncertainties created by the COVID-19 pandemic.The Board approved the payment of an increased interim dividend in April 2021 of 12p(16.68 cents)per share(FY20:interim dividend of 11.5p per share).Based on the financial position,the cash reserves of the G
307、roup,and the covenants applicable to the new debt facility,it is the intention of the Board to pay a final dividend for the year ended 30 June 2021.As explained on page 12,the Directors are recommending the payment of a final dividend of 15.5p(21.47 cents)per share based on the results for 2021.Subj
308、ect to approval at the Annual General Meeting,the final dividend will be paid on 21 December 2021 to shareholders on the register as at 26 November 2021.In reaching these dividend policy decisions,the Board had regard to the need to act fairly between its shareholders,its lenders and the long-term i
309、nterests of the business.ShareholdersShare PlacingAborted share placing(August 2020)On 11 August 2020,the Company announced a proposed placing to institutional investors in order to raise approximately 80 million before expenses.Conducted through an accelerated bookbuild process,the proposed placing
310、 was to be of new Ordinary Shares in the Company that were expected to represent approximately 20%of its then issued share capital.The net proceeds of the proposed placing were intended to be used for acquisition opportunities,whilst maintaining the Groups prudent balance sheet.Despite the successfu
311、l launch of the accelerated bookbuild and a strong oversubscription,on 12 August 2020 the Company announced that the Board had decided that it would be in the best interests of the Company and its shareholders not to proceed with the placing at that time.Share placing completed(June 2021)In June 202
312、1,the Company completed a share placing which resulted in the allotment of 6,192,652 new Ordinary Shares at an issue price of 22.00($31.05)per share,representing approximately 23.1%of the issued share capital prior to the placing.The new Ordinary Shares rank pari passu in all respects with the exist
313、ing Ordinary Shares of the Company,including the right to receive all dividends and other distributions declared,made or paid after the date of issue,including the final dividend declared in respect of the year ended 30 June 2021.The purpose of the share placing was to obtain net proceeds to part fu
314、nd the acquisition of SDS Holdco,Inc.,the ultimate holding company of Sentry Data Systems,Inc.Further details are included in Note 18 to the financial statements.The Placing was conducted through an accelerated bookbuild process and it was effected by way of a cash box structure.This Placing structu
315、re was chosen as the Company was required to reduce the execution risk in respect of the acquisition or it would have been unable to participate in the acquisition process.Whilst the Placing was not carried out on a fully pre-emptive basis,Craneware consulted with a number of its major shareholders
316、prior to the Placing and has respected the principles of pre-emption through the allocation process.The Company was pleased by the support it received from both existing and new shareholders.ShareholdersShareholdersStrategic Report:Section 172(1)Statement Contd21Cranewareplc AnnualReport2021Principa
317、l decisions/eventsActions and impactKey Stakeholder group(s)affectedAcquisitionOn 7 June 2021 the Board announced the proposed acquisition of SDS Holdco,Inc.,the ultimate holding company of Sentry Data Systems,Inc.(“Sentry”).The acquisition was completed on 12 July 2021.The aggregate consideration f
318、or the acquisition of Sentry(on a cash free/debt free basis)was$400m.The consideration for the acquisition was satisfied as to$312.5m(as adjusted)in cash and as to$87.5m by the issuance,on 14 July 2021,of 2,507,348 new ordinary shares in Craneware plc.The cash consideration was funded from a combina
319、tion of:the Groups existing cash resources;from a new secured debt facility;and the$187.3m net proceeds of the share placing which completed in June 2021.Further details regarding the acquisition are contained in Note 25 to the financial statements.The Board of Directors believe that this acquisitio
320、n is both strategically and financially compelling.Sentrys focus on the hospital link to community pharmacies adds breadth and depth to our healthcare data,providing extra insight into margin improvement opportunities within hospital operations and pharmacy costs in particular.As the second largest
321、cost centre for hospitals after the workforce,this is an important area of focus for hospital management teams,as they seek to deliver greater value in healthcare.The successful conclusion of the acquisition of Sentry marks a transformational point in Cranewares journey,considerably expanding our cu
322、stomer base,data sets,product offering and market presence.Together,we will offer healthcare organisations innovative new ways to measurably impact operational and financial performance and generate sustainable margins that can be re-invested in providing better care for those who are in need.Follow
323、ing the acquisition,Craneware now serves approximately 40 percent of US hospitals and more than 10,000 clinics and retail pharmacies across all the major pharmacy brands as well as local community pharmacies and clinics.With the quality and breadth of the combined data sets from both companies,Crane
324、ware will deliver far-reaching actionable insights for better operational and strategic decisions,enabling further efficiencies in provider performance so Cranewares customers can focus on serving their communities and healthcare missions.CustomersShareholdersEmployeesOn behalf of the BoardCraig Pre
325、stonChief Financial Officer20 September 2021Stakeholder Engagement 22Cranewareplc AnnualReport2021The Board is responsible for leading stakeholder engagement,ensuring that we fulfil our obligations to those impacted by the business.We believe that considering our stakeholders in key business decisio
326、ns is fundamental to our ability to drive value creation over the longer term.Our key stakeholder groups and how we engage with them are summarised in the tables below.The views of stakeholders have been considered in the scheduled Board and Operations Board meetings as well as in the context of pri
327、ncipal decisions and events including the response to the COVID-19 pandemic and the acquisition of Sentry Data Systems,Inc.(“Sentry”),as outlined in the Section 172(1)Statement.By understanding our stakeholders,we can factor into the Boards discussions the potential impact of our decisions on each k
328、ey stakeholder group and consider their needs and concerns,in accordance with section 172(1)of the Companies Act 2006,as outlined on page 18.Not all information is reported directly to the Board and not all stakeholder engagement takes place directly with the Board.However,the output of this engagem
329、ent informs business decisions,with an overview of developments and relevant feedback being reported to the Board.More material matters require the Boards consideration,with the Board engaging directly with,primarily,our employees and shareholders.EMPLOYEESWe recognise the value of our employees and
330、 that the success of the Group is due to their efforts.Employee engagement is based on Cranewares Framework and core values of honesty,integrity,hard work to the highest quality,service and enjoying the challenge.Employee engagement initiatives have been further developed in the year ended 30 June 2
331、021 using appropriate arrangements while the whole team worked from home during the year due to the COVID-19 pandemic.We aim to continue to further enhance employee engagement on an ongoing basis,appropriate to the development and expansion of the team.How we engageEmployee engagement surveys:We now
332、 conduct quarterly employee surveys which are hosted by an external survey vendor.Each employee engagement survey gathers employee views,with anonymised responses,on topics including:culture,understanding strategy,working environment,morale,reward,work-life balance.The survey conducted this year ach
333、ieved a very high level of response from employees.Satisfaction scores are evaluated to provide a breadth of context about how employees are feeling and an Employee Engagement Index is also collated and monitored.The nature and format of the questions for this years survey were considered in conjunction with the Employee Advisory Committee.Employee Advisory Committee(EAC):We launched our EAC durin
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