Skip to main content
Subscribe
  • Sign Up Free
  • Login
  • Subscribe
  • News
    • Current News
    • Providers
    • Insurance
    • Government
    • Finance
    • Technology
    • Safety & Quality
    • Digital Health
    • Transformation
    • ESG
    • People
    • Regional News
    • Digital Edition (Web Version)
    • Patients
    • Operations
    • Care Delivery
    • Payment
    • Midwest
    • Northeast
    • South
    • West
  • Blogs
    • AI
    • Deals
    • Layoff Tracker
    • HIMSS 2023
  • Opinion
    • Breaking Bias
    • Commentaries
    • Letters
    • From the Editor
  • Events & Awards
    • Awards
    • Conferences
    • Galas
    • Virtual Briefings
    • Webinars
    • Nominate/Eligibility
    • 100 Most Influential People
    • 50 Most Influential Clinical Executives
    • Best Places to Work in Healthcare
    • Excellence in Governance
    • Health Care Hall of Fame
    • Healthcare Marketing Impact Awards
    • Top 25 Emerging Leaders
    • Top Innovators
    • Diversity in Healthcare
      • - Luminaries
      • - Top 25 Diversity Leaders
      • - Leaders to Watch
    • Women in Healthcare
      • - Luminaries
      • - Top 25 Women Leaders
      • - Women to Watch
    • Digital Health Transformation Summit
    • ESG: The Implementation Imperative Summit
    • Leadership Symposium
    • Social Determinants of Health Symposium
    • Women Leaders in Healthcare Conference
    • Best Places to Work Awards Gala
    • Health Care Hall of Fame Gala
    • Top 25 Diversity Leaders Gala
    • Top 25 Women Leaders Gala
    • - Hospital of the Future
    • - Value Based Care
    • - Hospital at Home
    • - Workplace of the Future
    • - AI and Digital Health
    • - Future of Staffing
    • - Hospital of the Future (Fall)
  • Multimedia
    • Podcast - Beyond the Byline
    • Sponsored Podcast - Healthcare Insider
    • Sponsored Video Series - One on One
    • Sponsored Video Series - Checking In with Dan Peres
  • Data & Insights
    • Data & Insights Home
    • Hospital Financials
    • Staffing & Compensation
    • Quality & Safety
    • Mergers & Acquisitions
    • Data Archive
    • Resource Guide: By the Numbers
    • Surveys
    • Data Points
  • Newsletters
  • MORE+
    • Contact Us
    • Advertise
    • Media Kit
    • Jobs
    • People on the Move
    • Reprints & Licensing
MENU
Breadcrumb
  1. Home
  2. Finance
February 07, 2016 11:00 PM

Premier posts strong gains in technology segment

Adam Rubenfire
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    (This story was updated at 7 p.m. Eastern)

    Premier reported a jump in profits attributed to growth in its group purchasing business and even stronger growth in sales of its performance improvement technology and services.

    The company reported adjusted fully distributed income of $61.7 million during the three months ended Dec. 31, the second quarter of its fiscal year. That's a 17% increase from $52.1 million reported during the same period the year before.

    The adjusted income figure reflects ongoing exchanges of GPO member-owners' Class B stock into Class A stock after the company's initial public offering in late 2013. Premier reports the financials as if all members have exchanged their stock and the company was fully public. Shareholders have so far exchanged 40% of all shares that are eligible for exchange.

    Without the adjustment, Premier reported $61 million in profit, down 7% in part due to higher tax-related expenses. Premier, however, says the non-adjusted figures don't accurately portray the company's operating performance, in part due to the Class B stock exchange process.

    Revenue was up 17% to $291.7 million compared with the same period before. That reflects a 13% increase in supply chain revenue and a 27% increase in revenue from performance services and software.

    Performance improvement, which the company has aggressively sought to expand through acquisitions, now contributes about 30% of the Premier's total revenue.

    Growth in the segment in the most recent quarter was mainly driven by subscriptions and renewals of the company's PremierConnect software, as well as consulting services. Segment revenue of $88.6 million was also helped by recent acquisitions of CECity, Healthcare Insights and InflowHealth.

    CECity had its strongest second quarter sales growth in its history, according to Premier COO Mike Alkire. The firm's success reflects a growing need for analytics in the ambulatory provider space, he said during a conference call Monday.

    Alkire said Premier is seeing a lot of interest via e-commerce and through its GPO membership for physician performance management and value-based payment reporting software. He expects demand to increase as more providers join the CMS physician-quality reporting system. Premier has also solicited partnerships with electronic health record and pharmaceutical companies.

    Premier's supply chain revenue comes from its GPO and supply chain products. Revenue from GPO administrative fees grew 7% to $120 million thanks to increased contract penetration, new recruitment and positive utilization at hospitals, according to the company. Product sales grew 22% to $81.3 million because of increased use of the company's direct sourcing and specialty pharmacy businesses.

    Alkire also announced that Rockford, Ill.-based MercyRockford Health System and HealthPartners, an integrated hospital and health plan system in Bloomington, Minn., had joined the system's GPO and subscribed to its PremierConnect platform. During the second quarter, Premier picked up 17 new subscribers to its PremierConnect Supply Chain Connect software, and increased its integrated pharmacy membership, which includes specialty pharmacy services and pharmacy benefits management, to 39 providers, he said.

    The company reported six-month revenue of $562.5 million, up 17% from the year-ago period. Adjusted fully distributed net income for that period was $117.8 million, up 18% from $99.9 million during the same six months in 2014.

    Based on the positive second-quarter results, Premier raised its fiscal 2016 revenue guidance and now predicts a 15% to 18% year-over-year increase.

    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    Copy of finance_arrows_down_WEB_i_i_i.jpg
    Dozens of hospitals, health systems see credit rating downgrades
    Copy of states hospital costs_WEB_i.jpg
    Mark Cuban-backed study finds price discrepancies in hospital services
    Most Popular
    1
    Centene to lay off 2,000 workers
    2
    How health systems are battling price-gouging allegations
    3
    Senate advances bill to temporarily aid hospitals, health centers
    4
    Elevance, Blue Cross Louisiana halt $2.5B proposed deal
    5
    Tower Health to sell urgent care centers, close others
    Sponsored Content
    Daily Finance Newsletter: Sign up to receive daily news and data that has a direct impact on the business and financing of healthcare.
    Get Newsletters

    Sign up for enewsletters and alerts to receive breaking news and in-depth coverage of healthcare events and trends, as they happen, right to your inbox.

    Subscribe Today
    MH Magazine Cover

    MH magazine offers content that sheds light on healthcare leaders’ complex choices and touch points—from strategy, governance, leadership development and finance to operations, clinical care, and marketing.

    Subscribe
    Connect with Us
    • LinkedIn
    • Twitter
    • Facebook
    • RSS

    Our Mission

    Modern Healthcare empowers industry leaders to succeed by providing unbiased reporting of the news, insights, analysis and data.

    Contact Us

    (877) 812-1581

    Email us

     

    Resources
    • Contact Us
    • Help Center
    • Advertise with Us
    • Ad Choices
    • Sitemap
    Editorial Dept
    • Submission Guidelines
    • Code of Ethics
    • Awards
    • About Us
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Modern Healthcare
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • News
      • Current News
      • Providers
      • Insurance
      • Government
      • Finance
      • Technology
      • Safety & Quality
      • Digital Health
      • Transformation
        • Patients
        • Operations
        • Care Delivery
        • Payment
      • ESG
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition (Web Version)
    • Blogs
      • AI
      • Deals
      • Layoff Tracker
      • HIMSS 2023
    • Opinion
      • Breaking Bias
      • Commentaries
      • Letters
      • From the Editor
    • Events & Awards
      • Awards
        • Nominate/Eligibility
        • 100 Most Influential People
        • 50 Most Influential Clinical Executives
        • Best Places to Work in Healthcare
        • Excellence in Governance
        • Health Care Hall of Fame
        • Healthcare Marketing Impact Awards
        • Top 25 Emerging Leaders
        • Top Innovators
        • Diversity in Healthcare
          • - Luminaries
          • - Top 25 Diversity Leaders
          • - Leaders to Watch
        • Women in Healthcare
          • - Luminaries
          • - Top 25 Women Leaders
          • - Women to Watch
      • Conferences
        • Digital Health Transformation Summit
        • ESG: The Implementation Imperative Summit
        • Leadership Symposium
        • Social Determinants of Health Symposium
        • Women Leaders in Healthcare Conference
      • Galas
        • Best Places to Work Awards Gala
        • Health Care Hall of Fame Gala
        • Top 25 Diversity Leaders Gala
        • Top 25 Women Leaders Gala
      • Virtual Briefings
        • - Hospital of the Future
        • - Value Based Care
        • - Hospital at Home
        • - Workplace of the Future
        • - AI and Digital Health
        • - Future of Staffing
        • - Hospital of the Future (Fall)
      • Webinars
    • Multimedia
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Sponsored Video Series - One on One
      • Sponsored Video Series - Checking In with Dan Peres
    • Data & Insights
      • Data & Insights Home
      • Hospital Financials
      • Staffing & Compensation
      • Quality & Safety
      • Mergers & Acquisitions
      • Data Archive
      • Resource Guide: By the Numbers
      • Surveys
      • Data Points
    • Newsletters
    • MORE+
      • Contact Us
      • Advertise
      • Media Kit
      • Jobs
      • People on the Move
      • Reprints & Licensing