Cerner profits rise 15 percent on record bookings

Cerner signage at a Healthcare Information and Management Systems Society conference | Photo from Cerner on Facebook
Cerner signage at a Health care Information and Management Systems Society conference | Photo from Cerner on Facebook

Cerner Corp.’s second-quarter profit rose 15 percent from a year ago as the company continued reaping the rewards of new health care mandates requiring health care providers to upgrade their patient record-keeping and billing systems.

The North Kansas City-based health care information technology firm saw new business bookings climb 15 percent to $1.08 billion, an all-time high.

“Our outstanding second quarter results reflect Cerner’s strong position in a growing industry,” Cerner chairman, co-founder, and CEO Neal Patterson said in a press release. “Health care providers face a growing list of measures and mandates that are putting pressure on them to lower costs while also improving quality. We believe information technology is the biggest lever to help them address these challenges.”

Cerner posted a profit of $129 million, or 37 cents per share, up from $112.9 billion, or 32 cents per share, a year earlier. Revenue rose 20 percent to $851.8 million.

Analysts polled by Zacks.com were forecasting a per-share profit of 36 cents and revenue of $810 million.

The growth comes a week after Cerner received an additional $110 million in subsidies from Kansas City’s Tax Increment Financing Commission for the company’s 290-acre Three Trails project in south Kansas City. The $4.5 billion project is expected to house 16,000 new employees.

The company also provided its estimates for the rest of the year. Cerner said it expects third-quarter revenue of between $840 million and $870 million, and full-year revenue of $3.3 billion and $3.4 billion, up from a previous 12-month estimate of $3.25 billion.

The company expects orders for new business in the third quarter to hit between $1 billion and $1.1 billion, continuing the positive trend of the second-quarter results.

Cerner’s system sales, the largest contributor to its revenue, posted a 16.9 percent jump in sales, and its IT support and maintenance business saw a 21 percent increase.

Shares were up 33 cents to $55.97 at in after-hours trading Thursday. The stock is up 1.6 percent since the start of the year.


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