CompuGroup Medical SE & Co KgaA

XETRA:COP

Earnings Call Transcript 2020-Q2

[Claudia Thomé, Head of Investor Relations]

Good morning, everyone, from Koblenz, and a very warm welcome to our investor and analyst call for the Q2 and first half results. I trust you've seen that we've published the results on our website. The report is available there and also the presentation, which you should also have received. As always, we will have a presentation by our CFO, Michael Rauch, followed by a question-and-answer session.And with that, I would like to hand over to Michael.

[Michael Rauch, CFO & Member of Management Board]

Thank you, Claudia. Good morning, everyone, and a warm welcome on a sunny day here from our headquarters in Koblenz.Today, we are reporting our Q2 results, which has been the quarter fully impacted by the worldwide COVID-19 pandemic. Our customers, in particular, doctors, hospitals and pharmacies, are at the forefront of this dramatic challenge, and we at CompuGroup Medical are dedicated to support them in the best possible way.Our financials show an impressive resilience in this volatile environment, and we've continued investing to further pursue our growth path. We've seen several evolving additional business opportunities resulting from the increasing need for digitization in health care. In today's presentation, I will give you an overview on the operational highlights followed by the financials including segment specifics and closing with the guidance, which we are raising.As usual, please consider the disclaimer as read and taken to the notes.First and most of all, allow me to start with a big thank you to everyone out there working in the health care sector worldwide, doctors, nurses, medical aid and care personnel, for their courage and dedication, working relentlessly to treat and help patients suffering from COVID-19 and prevent the virus from spreading further. The health and safety of our employees and also of our customers remains #1 priority for us.Whether mostly from home office during the early days of the pandemic or now with the majority of employees back at the office, we have continuously made sure that the service support for our customers is fully operational. This worldwide pandemic has reminded all of us at CompuGroup Medical in a very dramatic way of the fundamental importance of our company's purpose. Our founder's purpose statement has never been more relevant than today. Nobody should suffer or die because at some point medical information was missing. Our employees have been working hard to go the extra mile for our customers, creating innovative solutions for new challenges. Big thank you to all of you.Moving into the highlights of the past month, let's start with the most recent news. In July, we finally received the approval by gematik for our KoCoBox MED+ as the first e-health connector in German Telematics Infrastructure rollout. This means that the next big stage of the TI rollout can start, and our connector is yet again the early mover. The e-health connector is enabling our customers to make use of the next set of applications within the TI framework, the emergency patient data records, the qualified electronic signature and the electronic medication plan. It is also the prerequisite for the so-called KIM module, the secure e-mail communication system that had already been approved by gematik shortly before.For our installed base of 55,000 practices of doctors and dentists, the e-health connector comes in the form of an upgrade that is downloaded from the gematik server. This is happening as we speak day-by-day now. The approval has also been the starting point for the installation at pharmacies. Here, we have received 4,000 orders so far, and the installation process has started. We are moving into this next phase of the rollout, building on an excellent performance of our connectors we have in the field so far, and our connector has not been affected by any outage.Building on these upgrade and rollout news, we have more visibility now in terms of the full year guidance. Our expectations for the full year TI impact have basically been confirmed, and I will come back to this towards the end of the presentation.I would also like to use today's opportunity to shed some light on the CLICKDOC video consultation offering. The COVID-19 pandemic has led to a massive shift in terms of mindset in a very short time frame for digital and virtual applications in health care. Recent representative polls have shown around 50% of doctors are now using video consultation, and another 10% are planning to. This compares to 3 years ago when only 1.8% of doctors were using a video consultation tool and another 1% who were planning to. At CompuGroup Medical, we've been providing our CLICKDOC video consultation free of charge since the beginning of the pandemic, and we've seen the number of registration increase massively during just a couple of weeks to now around 90,000.We are now in a position to provide you with more details on the patterns that are evolving around the regular usage. Roughly 1/4 of registered users have become active users. Within those, almost 1/3 is doing more than 3 sessions per week. We've analyzed the usage country-by-country and decided to start charging in the U.S. first, then in Germany and now most recently also in France. Depending on usage and on country, we are charging between EUR 20 and EUR 50 per month. And at this point, it is obviously very much a trial period in many aspects. It has been an encouraging start with already 2,500 contracts signed, but we are still in early days. We think that the low double-digit million euro amount is achievable in a full rollout scenario from 2022 onwards.Another recent good news has been the closing of the acquisition of parts of the Cerner portfolio as of July 1, our largest acquisition so far. This transaction is a quantum leap forward for our HIS segment. We are significantly increasing scale and are now the clear #2 in Germany, the DACH region and for public hospitals in Spain. In German acute hospitals, we have added more than 3x the number. Going forward, this puts us in an excellent position to benefit from mutual best practice rollouts across the different products and features.Based on pro forma 2019 financials, our HIS business now represents more than EUR 200 million in revenues at a margin of around 15%. We are consolidating medico, Soarian Health Archive and Selene from July 1, and I will come back to the impact on this year's guidance towards the end of the presentation.We've also significantly strengthened our financial position to prepare for the next growth stage. In June, we successfully placed all of our treasury shares, headed by a 0.97% capital increase in a 10% overnight book-building. This transaction resulted in gross proceeds of EUR 341 million, providing us with additional headroom for further strategic steps. The equity ratio at the end of Q2 2020 is up from 24% to now 43%. Following the increase of the free float to 50%, we've seen higher liquidity in the shares, all of which being good news for our shareholders.With that, let's now move into the discussion of Q2 financials. Considering that Q2 has been the first full quarter under the COVID-19 regime, we have seen a very solid performance here at CompuGroup Medical, also taking into account the strong prior year one-off effect from the Telematics Infrastructure. Q2 2019 was the last quarter of significant contribution from Telematics Infrastructure onetime installation fees in the AIS segment. This obviously poses tough prior year comparisons on the AIS segment and on the group overall. Against this backdrop, we've seen a very solid underlying revenue growth of 6% across the group, meaning organic growth excluding Telematics Infrastructure.EBITDA adjusted slightly up with the margin 1 percentage point even in spite of prior year TI rollout. Group revenues are down 4% and reached EUR 180 million. As already pointed out, the underlying growth excluding TI stood at 6%, with the prior year having been impacted by the TI one-offs. The percentage of recurring revenues is up from 60% to 69%, and we've seen excellent growth of recurring revenues by 10%. Now just to place a word of caution here, we will not raise our guidance of above 60% recurring revenue share in relation to total revenue for the full year as we will see TI onetime revenues again in Q1 -- sorry, in Q3 and Q4 2020 from the software upgrade of the connector and the pharmacy rollout.Moving down to the bottom line, let's take a look at the line items down the P&L. We've achieved a slight increase in EBITDA despite the revenue decline and increased R&D investments, reflected by yet another increase in personnel expenses that have also been impacted by acquisitions. Cost of goods sold show an improvement year-on-year, and the gross margins up 4 percentage points mainly due to the higher share of hardware sales in the prior year quarter due to the TI rollout, which have a lower margin.As expected, free cash flow was significantly below prior year mainly due to changes in net working capital. Whilst we saw a reduction of inventory and receivables in Q2 of last year with high buildup of payables, this quarter, we paid down payables from purchased inventory for the TI rollout in Q2 and, hence, expect a better Q3 2020 working capital position than Q3 2019. We reduced net debt significantly following the successful placement of shares in June. Leverage was down to 0.6x from 2.2x. Obviously, taking into account the closing of the HIS transaction, which occurred after the record date, so July 1 versus June 30, pro forma leverage is at 1.7x.We also have our debt facility in the size of EUR 1 billion in place, so I mentioned that already in the last call, running over 5 years with a 1-plus-1 extension option and split into a EUR 400 million term loan and a EUR 600 million revolving credit facility. This facility can be tapped for acquisitions and general corporate purposes.Let's now move to our segment reporting. Carrying on with the segment financial overview, all segments showed a positive revenue growth adjusted for the one-off TI implementation revenue in Q2 2019. Also, EBITDA developed nicely in line, hence, contributing to a 25% return on sales EBITDA margin.Going into the segment specific, let's move to our largest segment, Ambulatory Information Systems space. Here, we recorded very good organic growth, again, of 7% excluding TI, taking into account that Q2 2020 was the first full quarter under COVID-19. Reported revenues were down 9% with the prior year one-off revenue in TI being the reason. But the underlying business growth continued to benefit from the phasing out, sorry, of Windows 7 in a number of countries. And the recurring revenues have grown by 8% year-on-year and now represents 77% of revenues in this segment. The EBITDA was down 6% due to the prior year one-off in TI, but the margin is up 1 percentage point due to a better revenue mix with the priority TI hardware sales having a lower margin and the recurring revenue growing nicely this year. Moving into the second half of the year now, the segment will benefit once again from the additional revenues from the next level of TI rollout, consisting of the software upgrade of the connector for dentists and doctor practices.Turning to the next segment, the Pharmacy Information Systems segment. Here, we achieved an organic revenue growth of 6% mainly driven by additional sales in German pharmacies resulting from a module for cash points that is being rolled out until September. EBITDA also benefited from the revenue increase, and the EBITDA margin was even up 6 percentage points, helped by the COVID-19-induced cost containment here, mostly in Italy, so fantastic jobs again to our colleagues in Italy. Like in Q1, the business has been continuing to perform well despite the COVID-19 situation and despite our specific exposure in Italy to the segment. Moving into the second half, we expect segment -- the segment to benefit as planned from the first-time TI installations in German pharmacies. So we'll come to that also when talking about the guidance.Also, our Hospital Information Systems segment performed well in Q2 2020. Here, revenues grew by 4% overall and 1% organically. In this segment, the COVID-19 pandemic had the highest impact. We've seen tenders being pushed out, and the German hospital business has actually seen a slight decline in revenues year-on-year in Q2. This was, however, compensated by a positive development in the lab business and the revenue increase in Austria resulting from the rollout of the large order in Lower Austria that we won last year. Overall, this led to a slight increase in organic revenues across the segment. EBITDA, on the other hand, increased significantly mainly driven by higher project costs in the prior year quarter which obviously didn't reoccur. In the second half year, the additional contributions from the acquired medico and Selene business will be included. And I will also come back to this when talking about the guidance.Before coming to the guidance, let's finalize the segment review with the Consumer & Health Management Information Systems segment. In the Consumer & Health Management Information Systems segment, the revenues increased by 6% to almost EUR 11 million. The revenue growth is mainly driven by the CGM LIFE activities, where we saw a strong increase in the development and operations of software solutions in the private insurance sector. EBITDA and the margins are down through increased R&D investments but here talking about a comparably very small euro impact given the smaller size of the segment.Now let's take a closer look at our guidance for 2020. We are raising our expectations for group revenues to a range of EUR 820 million to EUR 860 million and for EBITDA adjusted to a range of EUR 205 million to EUR 220 million. This raise is reflective of the inclusion of 6 months of the acquired assets in the Hospital Information Systems segment and is also reflective of higher certainty on the Telematics Infrastructure particularly for the Ambulatory Information Systems segment. Hence, we have not only tightened the range of the guidance but also raised the lower end stronger than the upper end both in revenues and adjusted EBITDA.In the AIS segment, we feel confident now to narrow the range and increase the revenue guidance to EUR 470 million to EUR 490 million based on the approval of the Telematics Infrastructure connector software upgrade we have received. For the PCS segment, our guidance range remains unchanged with revenues between EUR 124 million and EUR 134 million being expected. Regarding the impact from Telematics Infrastructure in the second half, we've seen a good start in terms of orders, but the order and sales process is ongoing. And unlike the AIS segment, a physical installation at the pharmacy is required. And here, we will need to see how a potential second wave of COVID-19 that everybody is talking about right now could have an impact on the rollout process. In the HIS segment, we've added the anticipated half year 2 revenues from the part of the portfolio acquired from Cerner. Our guidance for the CHS segment remains unchanged at EUR 46 million to EUR 48 million.We've also revisited the additionally guided KPIs and updated them accordingly. Hence, we now expect our organic growth in the range of 2% to 6%, increasing the lower end of the range due to less uncertainty from TI and an understanding of the overall strength of the business even in difficult and volatile times. We continue to see recurring revenues above 60% of total revenues as a higher share of recurring revenues in the first half of 2020 will be balanced by a higher onetime revenue from Telematics Infrastructure in the second half of 2020. Adjusted EPS includes the increased EBITDA guidance as well as the higher share count following the placement of shares in June. CapEx should be slightly below the range originally planned due to some postponed projects. And adjusted free cash flow is expected slightly better now at more than EUR 85 million.In summarizing and moving to the second half of this year, we certainly feel encouraged and determined to continue living our purpose statement that nobody should suffer or die because at some point medical information was missing. There's a clear indication that the COVID-19 pandemic will cause the health care sector to shift even faster to increasing digitization. Connectivity of health care participants will play a larger role and our customers, doctors, pharmacies, hospitals, will remain at the core of this development. CompuGroup Medical is in an excellent position to benefit from these trends, and we are set for further growth building onto our strong market positions, our crisis-resilient business model with more than 60% of recurring revenues. And we will continue to invest into R&D and pursue value-enhancing M&A opportunities.Regarding the next touch points, we would like to invite you to our annual Capital Markets Day on September 16, 2020, which this year is going to be fully virtual event given the COVID-19 situation. The executive management team will be presenting an in-depth view on the respective businesses, and we look forward to welcoming you.Thank you for your attention, and we're now looking forward to your questions. With that, I hand back to the operator.

[Operator]

The first question is from Florian Treisch, Commerzbank.

[Florian Treisch, Research Analyst]

I have some questions, if I may. So the first, looking at your AIS guidance, I believe quite a strong H2 over H1 performance was implied. Here, I would like to better understand what are the drivers behind it. It's for sure the TI rollout, but simply to get a better feeling, can you quantify the impact you expect the TI rollout to have in H2? As I believe simply, the performance H2 over H1 has never happened in the past before, so clearly, there must be a clear push from this TI rollout.The second one is around your capitalized R&D level, it is up or basically doubled year-over-year. It's now almost 1/4 of EBITDA. So I would like to get a better understanding why capitalized R&D is up so strongly and if that is a sustainable level also in the quarters to come.And last but not least, if I may, last one, you have been kind of verbally overly optimistic for the telemedicine upside opportunity ahead of you. I agree this is a mid- and long-term driver. But if I now look at the actual outcome of what you believe is a realistic level for 2022, i.e., this low double-digit number, it at least does not sound like an impressive game-changing product for me. It's 1%, 2% of revenues, 2%, 3%, let's say, whatever low end means. But can you give us a bit more detail? Is there like a conservatism in it? What is the optimism or how to read the whole number here?

[Michael Rauch, CFO & Member of Management Board]

Yes, many thanks, Florian. Let's start with the first point with the AIS guidance. Clearly, that is largely attributed to the TI rollout, as you rightly pointed out. And just to give you a little bit here on the magnitude, in earlier calls, we discussed the software upgrade for the connector for AIS, reflective of 55,000 practices, would bring an additional revenue amount of EUR 20 million to EUR 25 million. And we see that now coming in Q3 and Q4. We had already anticipated it earlier when we came out with our guidance on the 5th of February to be starting already in Q2. Now it's Q3 and Q4, but it will come, and thus, basically, we can now tighten the guidance here on the AIS side.Then your next question was with regard to the capitalized R&D situation. You're fully right. So if I take the half year numbers, we capitalized around EUR 17 million, 1-7, for R&D here. And we had already discussed basically towards the beginning of the year that we will have this year a higher R&D capitalization amount. We said around EUR 30 million to EUR 36 million, so depending on where we will come out finally, and we are fully in line with that. That has to do with higher spend here particularly still on the G3 side for our HIS segment, but we are also rolling out in the G3, so third-generation technology towards the other segments and have then higher spend here on capitalization. Plus we also mentioned that we are participating in some TI development here, for instance, talking about the electronic patient file record, where we also capitalized some amounts. So that is fully in line with the expectation and guidance given.So your last part of the question was with regard to CLICKDOC. And here, we said that we will give it out for free during the heat of the COVID-19 pandemic. So let's first of all keep our fingers crossed that the second wave will not come and hit and that everybody is healthy and the situation is improving for the overall health care sector. We have decided that we will go into charging now. We will have to learn and get experience here. We never, from our end, gave a guidance beyond what we are giving now as a guidance. We just basically now are concretely giving you a number that by 2022, so in a full state swing. And for us following, we would believe it's a low double-digit euro million amount. And I think for a tool coming out with that high of an amount, that is quite a success that people can be proud of.I just want to remind everybody here of other features that CompuGroup in the past has benefited from, that has been celebrated. They had EUR 4 million in revenue potential. If this is a double-digit amount, I think that is already twice the amount. So we're quite positive and still upbeat on the CLICKDOC video consultation here. Let's see then how it will develop, and we will further give updates quarter-by-quarter.

[Operator]

The next question is from Charlotte Friedrichs, Berenberg.

[Charlotte Friedrichs, Analyst]

The first one is a little bit more broadly. Looking at the recent weeks, there had been some outages with other providers of TI components. I know this doesn't affect you, but my question would be to what extent does it affect the debate that you're having with other stakeholders here with regards to the next step, additional services, et cetera, for the Telematics Infrastructure.Then the second question would be on the momentum that you're seeing right now with both the upgrade -- or the update for the doctors and dentists and also the pharmacies. Is there a good response from those groups to the go-ahead that you received here?And then finally, on HIS, is it too early to talk about the synergies that you may expect in the hospital business?

[Michael Rauch, CFO & Member of Management Board]

Thank you, Charlotte. I will start in the order of your questions. So going towards the TI situation, and you are fully right, you mentioned it fully correctly, we have not been experiencing any outage here on our connector, so we have not been affected. That was of a competitor's connector. And so with regard to does it have any impact on the overall TI situation, well, at least we are in a position right now to be the first one out there with an e-health connector. That gives us a bit of an advantage here, for instance, on the pharmacy rollout situation. And obviously, it gave us also confidence at least within our client base on the dentists and doctors' offices, where they felt very comfortable being a partner here to CompuGroup's Telematics Infrastructure situation.That maybe ties also into your second question, what is the experience. Now the early one was the software upgrade of the connector download for the doctors and also with the rollout for the pharmacies. Also on this one, we've seen very positive responses from the doctors that have already downloaded the software feature from the gematik server and are using it and are benefiting from it. And we will get more and more experience because, literally, as you might have seen when the news came out a couple of weeks ago, we're just in the process of starting here with the software upgrade, and the doctors are downloading it as they return back from vacation now.On the TI rollout for the pharmacies, we have received promising orders already throughout the year. And now we're very happy to have installed also the first pharmacy 2 weeks ago. And we are installing and rolling out pharmacy after pharmacy, and we received very positive feedback here. So let's see on the whole -- on how the whole situation will develop. And with around 4,000 orders received now, that is clearly on our fair share. And it seems like we're receiving orders not only from pharmacies where we sell information systems to but also from pharmacies that use competitors' products, not ours. So here, obviously, an early-moving advantage is [ feelable ].Your last question was with regard to the HIS segment and the question on the synergetic potential. When we came out with the news, so announcing about the signing of the acquisition on the 5th of February 2020, we said that we expect most of the synergies to be offensive so-called synergies, so being product synergies here, playing the best of both worlds. And that's still what we expect. So we are combining basically the features from the medico system and from the Selene system with our CGM CLINICAL and then seeing on how we can basically find the best way to offer to the whole hospital universe, and that is very promising.So we can give you a bit more color on that in our Capital Markets Day. So despite the fact that it's virtual, it's going to be very interesting, I promise. And I invite all of you again to join then in the conference call on the 16th of September. And with also Hannes Reichl, my Board colleague here on the Hospital Information Systems side, we'll give more color on that.

[Charlotte Friedrichs, Analyst]

Perfect. Definitely very much looking forward to the Capital Markets Day.

[Operator]

The next question is from Knut Woller, Baader Bank.

[Knut Woller, Analyst]

Three questions. Michael, the first one, on the adjustments you plan in 2020 to help us bridge between adjusted and reported EBITDA, I understand that some elements like future M&A are not part of it. But can you give us some ideas regarding restructuring charges also expected for Cerner to give us a better feeling here what the delta between adjusted and reported EBITDA will be?Then secondly, we discussed the topic already of the capitalized R&D. I mean what we have seen in '19 and also in H1 '20 was an acceleration of organic growth outside of TI which is quite encouraging, I think, looking at your historical growth rates. So the big question from my perspective is also looking at your investments -- increased investment levels today. What kind of organic growth rates do you expect to see on a sustainable basis going forward? Do you expect an acceleration to be sustainable compared to the past? And if so, to which extent?And then lastly, on your PCS guidance, can you share with us the number of pharmacies that you expect in your guidance for the PCS segment to be rolled out by the end of this year?

[Michael Rauch, CFO & Member of Management Board]

Thank you, Knut. So again, 3 questions. So let's start with the first one, on the adjustments, you wanted to have some guidance going forward, so how do we see the adjustments evolving then in Q3 and Q4. So just to remind everybody, we started basically, based on some investors' input, with reporting adjusted EBITDA and adjusting for the noncash component here on the share options for the management team which, obviously, you can then just take the quarterly amount and project it into the future. Then we have the adjustments for M&A activities, and this was our large-scale M&A activities where we basically have the onetime costs like, for instance, advisory costs or legal costs connected with that. And you saw that also here in the first quarter particularly for the assets acquired from Cerner.And then we had the adjustment also for our change of legal structure, which you now saw in the second quarter here also has been part of the adjustment. And then going forward, we will see the PPA effect, and we will adjust only for the first year of PPA effect in the adjustments. And that will now come because, as you know, within the first 12 months, basically, the purchase price allocation, the final one after closing has to be done, and we are obviously here in the midst discussing that with the consultants on how to best reflect that. But we have taken here an assumption, and that's how you basically can also build your model coming from adjusted EBITDA to reported EBITDA.There is no restructuring planned. But if we ever were to have restructuring, yes, it would also be adjusted for. But it's not planned. It's not part of the guidance included in 2020.Now on the capitalized R&D portion, yes, you're right, we are investing into R&D. And you see that also in the personnel investment, where we have been increasing also our personnel because we want to get certain competencies here on board. And part of that according to IRS regulations, we can obviously then capitalize and we do so. Obviously, we do that with the interest of generating further cash flows from sales and then also from profit EBITDA here. And so the ambition is clearly to grow organically also strong in the future. But please bear with me. We will come with an update on the next year, only out in February giving a concrete guidance and for 2021 on an organic growth level. But if you just think in terms of longer-term horizon, this year, we gave the guidance initially from 0% to 6% organic growth. And now we tightened it from 2% to 6%. So is that a range potentially which we could also see on the longer term going forward? I wouldn't be against it. So clearly, we want to achieve positive organic growth here and that being a single-digit number, and let's see on how it can develop, how high the single digit can be.Then on your last question with regard to PCS, yes, clearly, the rollout of the Telematics Infrastructure here is showing positive growth, and we want to connect all of the pharmacies that we have within our reach, where we basically are selling the Pharmacy Information Systems to. But like I said or indicated a bit already during the earlier question, we are also receiving offers from competitive pharmacy information systems providers -- sorry, pharmacists that use competitive products, and that for us is also a potential here. Included in the guidance is basically a range a little bit over EUR 10 million. We said earlier EUR 10 million to EUR 12 million -- sorry, EUR 10 million to EUR 12 million in the revenue. That's what we have included in the guidance range. So let's see, and we can give you more visibility during the Q3 call in November on how order intake will develop and also how the realization in the P&L will happen because here, we have physical installations, and we need to see on how many physical installations can be handled throughout the second half year.

[Operator]

The next question is from Andreas Wolf, Warburg Research.

[Andreas Wolf, Research Analyst]

It's Andreas Wolf, Warburg Research. I also have a couple of questions. So the first one would be on the software upgrade for the connector and also the e-signatures that are linked to it. Do you already have a pipeline full of products that would build on the e-signatures? So what should we expect to contribute to your revenues going forward based on the QES approval? That would be my first question.And then the second is e-prescriptions that would also probably be triggered by the QES going forward. Do we see opportunities here as well? So obviously, they are still linked to the first question. The third would be on the electronic health record. So obviously, the schedule is still valid. And my question would be whether there are significant preparations still needed on your side to also prepare the doctors for the EHR rollout and whether you still see opportunities here and what kind of form this would be.And then the last, on the hospitals, so you mentioned already there was less demand in the second quarter, also impacted by COVID-19. My question would be was it because hospitals are basically not allowing outside parties to enter hospitals or was it because some of them had financial issues that they had to deal with.

[Michael Rauch, CFO & Member of Management Board]

Yes. Thank you. I want to start in reverse order on your questions, just starting on the hospital side, Andreas. Actually, for us, it's very difficult to read why certain projects are being postponed or why less activity is ordered. So I would be here on assumptive ground, and I don't want to go into that territory. So for us, I think that's maybe more a question you probably need to ask the hospitals themselves. But it's clearly the fact that they have been ordering less professional service activity particularly here in Germany. So we've seen that. And probably, they had been busy with other things. But we have not seen, if that was part of your question, that revenues are not being cashed in, in the sense of receivables outstanding and the hospitals not paying on the services being charged. So here, we don't see any negative implication.With regards to the electronic health record, your third question, yes, clearly, we are building also parts of modules from the electronic health record system, so like from our software, Medistar, TURBOMED, ALBIS, for instance, here in Germany, in order to then download information into the patient file. And that for us is a little bit of a charging opportunity. And we can go into a bit more depth also during the Capital Markets Day.And then I want to tie in your first 2 questions because they are somewhat interlinked. You asked about the software upgrade, whether it would provide also opportunities for the e-signature. And then you asked also a follow-on question regarding e-prescriptions, what is additional revenue potential here. What I would suggest is, because we are going to do a deep dive on the Capital Markets Day in the area of TI opportunities for us, that we postpone the answer to that question to the 16th of September, and we can go a bit more in depth here. But obviously, most offer opportunities for us, but we are not yet in a position to quantify, but we will go into the direction in the Capital Markets Day.

[Claudia Thomé, Head of Investor Relations]

All right. And since there are no further questions, we would like to thank everyone for dialing in and taking the time. And if there are further questions, you can always contact Investor Relations by e-mail or on the phone, and we wish you a great day. Thank you, and bye-bye.

[Operator]

Ladies and gentlemen, thank you for your attendance. This conference has been concluded. You may disconnect.