Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!americast.com!americast.com!americast-post
Newsgroups: americast.ibd
From: americast-post@AmeriCast.Com
Organization: American Cybercasting
Approved: americast-post@AmeriCast.com
Subject: Companies In The News
Date: Wed, 28 Oct 92 13:12:52 EST
Message-ID: <3.1992Oct28.131253@AmeriCast.com>


10/28/92

TITLE Companies In The News #m#gm#m##m#Photo Neal
Patterson#m#Cerner Developing A Unified Hospital Information Sys-
tem John A. Jones The leading producer of clinical information
systems for hospitals and clinics, Cerner Corp. is well along in
developing a unified hospital computer system to meet the dif-
ferent needs of many departments.  Meanwhile, Cerner, based in
Kansas City, Mo., is building sales of its separate systems
tailored for specialized clinical laboratories.  The software
simultaneously keeps track of test results and the clinic's
operational, cost and financial details, on a set of common data-
bases.


Investor's Business Daily, Computer - Software ranks 21st, based
on six-month stock- price performance with added weight given to
recent months. In this series, leading companies within the group
are reviewed.  Chairman and Chief Executive Neal L. Patterson has
headed the company since its founding in 1980. President Clifford
W. Illig, originally chief financial officer, became president
and chief operating officer in 1987.  Third-quarter earnings
jumped 583% to 41 cents a share from six cents a year earlier.
Net income was up 621% to $2.97 million from $412,000. Revenue
rose 96% to $27.8 million from $14.2 million.

Nine-Month Net Tripled

For the nine months to Sept. 30, earnings rose 191% to 93 cents a
share from 32 cents a year earlier. Net income was up 209% to
$6.6 million from $2.1 million. Nine-month revenue grew 48% to
$74.3 million from $50.1 million.  Cerner ended 1991 with long-
term debt of just under $8 million, or 22% of total capital.

Illig reported Cerner generated a record $15 million in gross
profit in the third quarter, including $10.1 million on system
sales and $4.4 million from support and maintenance revenues.
"With a current installed base of more than 300 clients world-
wide, the company is well-positioned to leverage these foto

relationships to further enhance its revenue," Illig said.  John
Putnam, an analyst at Alex. Brown & Sons Inc., said revenue and
gross margin both beat expectations.  "That has a lot to do with
the product mix, from software as opposed to hardware," Putnam
said. "The support and maintenance business, very steady and
ongoing, grew nicely and had a very large gross margin." He said
Cerner also is doing a good job of controlling expenses.
Cerner's products are based on its Healthcare Network Architec-
ture, which provides a unified structure and common software
functions for developing additional information systems.  Its
PathNet products are aimed at the clinical laboratory information
systems market; RadNet products are designed for radiology labs,
and PharmNet products are tailored for pharmacies.  Cerner's
principal product line, PathNet, is one of the leading clinical
information systems available for general, microbiology and
pathology laboratories and blood banks.  Cerner's main thrust now
is to provide an integrated, patient-focused information system
that allows all of a hospital's clinical systems to share all vi-
tal patient information, automatically.  Historically, the com-
pany said, hospitals believed such integrated systems were una-
vailable. Instead, they bought disparate, disjointed systems for
each clinical area of the hospital: nursing, laboratory, radiolo-
gy, pharmacy, pulmonary, cardiology and surgery.  These separate
systems usually centered on patient accounting or accounts re-
ceivable applications. During the '80s, hospitals commonly used
interfaces to connect the clinical systems with the patient ac-
counting system.

New Strategic Alternative

"This approach created a complex, unmanageable technical environ-
ment while providing only limited benefit to the care providers,"
Patterson and Illig told shareholders. "Cerner is providing the
industry with a strategic alternative - Healthcare Network Archi-
tecture, a patient-focused system and a truly new paradigm."

They said Cerner began 1992 well-positioned in this growing and
potentially large new market segment.  In 1991, the company
signed four major contracts for HNA hospital systems, and in the
first half of 1992 Cerner signed up a 565-bed private community
teaching hospital for installation of the full suite of HNA
software products. The agreement was worth about $10 million.
The company also is expanding its international markets. Earlier
this year, it entered a joint venture agreement with a Saudi Ara-
bian health-care services company, to market Cerner's full line
of systems in the Kingdom of Saudi Arabia. In the latest quarter,
Cerner began installing multi-department systems in three Saudi
hospitals, and completed agreements with two hospitals in England
and Australia for PathNet systems.  Thursday: Dayton Hudson Corp.

This article is copyright 1992 Investors Business Daily. Redis-
tribution to other sites is not permitted except by arrangement
with American Cybercasting Corporation.  For more information,
send-email to usa@AmeriCast.COM