Healthcare and pharmacy software provider EMIS had another unwelcome surprise for the markets this morning. After 23 years with EMIS, Chief Executive Sean Riddell is to retire from his full-time executive role ‘to focus on his family commitments’ on March 21, the day that EMIS’ preliminary results are due. The news, which comes hot on the heels of EMIS’ revenue and profits warning in January (see Surprise year end warning from EMIS), sent the company’s share price down a further 7% in early trading.
EMIS is recruiting a permanent successor, but in the meantime Chris Spencer, Chief Administrative Officer, is to join the Board and work alongside Sean as Joint Chief Executive. He’ll take on the CE role on an interim basis when Sean steps down in March, and Sean will remain on the Board in a non executive capacity.
Sean has been the public face of EMIS since its flotation in 2010 and his retirement is bound to unsettle investors, particularly since it’s timed to coincide with full year results that did not meet expectations. The fact that the decision appears sudden also raises questions. That said, in so far as we can tell, EMIS still looks in pretty good shape. According to January’s warning it only marginally missed analyst expectations reporting headline revenue growth of nearly 18%, which most other companies in the sector can only dream of. It also appears well positioned to benefit from trends in the UK healthcare market as GPs gain more power and the sharing of patient records moves up the political agenda (see UK Healthcare SITS Market Trends & Forecasts). Nevertheless, we’re now very keen to see the detail in the full year results on March 21; let's hope there are no more surprises.