SHARES in Craneware, the software specialist focused on the US healthcare market, closed up nearly 8% after annual results beat expectations and the firm declared investments made over recent years are "coming to fruition".

Analysts upgraded revenue forecasts for the Edinburgh-based firm after it reported a 9% increase in revenue to $189.3 million, ahead of guidance, and highlighted an “increasing opportunity” to drive sales. The company's profits rose by 20% to $15.7m.

Craneware highlighted an “increasingly supportive market backdrop” across the Atlantic, where healthcare providers are looking to deliver “value-based care”, and a strong market response to its core Trisus platform. 

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It reported high levels of customer retention and the potential of its strategic alliance with IT giant Microsoft, which the company said is helping to extend its market reach through its Trisus offering being marketed on the Microsoft Azure Marketplace.

And Craneware signalled its prospects are unlikely to be derailed by November's US election, as chief executive Keith Neilson said both the Democrats and Republicans have a “bi-partisan commitment to improving healthcare”, albeit they differ on how to deliver that goal.

“The positive is seeing the fruits of our labour over the last few years all coming together, and [we are] starting to see some real good progress and momentum continuing into this year as well,” Mr Neilson told The Herald.

Analysts reacted positively to the results and Craneware’s prospects for further growth. Peel Hunt noted that the company’s products can help healthcare providers deal with challenges such as staffing shortages, rising regulatory demands and cutting costs while maintaining quality of care, as it upgraded its forecasts for the company.

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“Having talked to management, and taking into account commentary from other peers in the US health-tech space, we are, for the first time in a while, pushing through some small upgrades to revenue (+3% FY25E and FY26E),” it said in a note for investors. “We believe we are the start of an upgrade cycle similar to the mid-2010s.”

Asked to comment on the general health of the US economy, following recent concerns over the labour market, Mr Neilson said that “generally it is an improving picture for our hospitals and for our customers”.

“Healthcare is probably a little bit different in that it doesn’t feel like the election is going to massively affect healthcare from what we can see. Both parties have been a little bit light on detail on their healthcare policies, but it feels like both are striving to get better value in healthcare, which is generally seen as being supportive of the hospital environment. We are seeing that as being improvements.

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“We are 16 months passed the end of the healthcare emergency and I think people are definitely seeing improvements, and that is being reflected in our sales profile. [We have] a good healthy mix of both products and size of deals coming through; no heavy dependency on any one area, which I like.

“Everyone is worried as they are in this country about the cost of living and prices, but other than that, I think generally things feel like they have turned a little bit of a corner.”

Craneware proposed a final dividend of 16p per share, giving a total dividend for the year of 29p per share – up 2% on last year.

Mr Neilson said: “The strong financial results during the year demonstrates the strength of the Trisus platform, our increasing platform partnership successes and the role we play in helping healthcare providers drive for better value in the US healthcare market.

“We see increased opportunity ahead. Our alliance with Microsoft will allow us to accelerate innovation and explore new AI-based applications in an efficient manner which, alongside the breadth of the Trisus platform, our unique data assets and our considerable and extensive customer base provides significant scope for expansion in the size of our addressable market.

“We approach this opportunity from a position of strength and resilience, with a strong balance sheet, high levels of recurring revenue and consistently high customer retention rates. This gives us the confidence and the ability to continue investing for growth, to secure our long-term market position.”

Shares in Craneware closed up 160p, or 7.8%, at 2,230p.