Misys overhaul bearing fruit

Restructuring helps health care software firm's bottom line

The Raleigh-based health care subsidiary of British software maker Misys is on the mend following a major overhaul that stemmed previous losses.

Misys Healthcare Systems underwent several tough quarters more than a year ago that spurred management to dump two business units, reorganize sales and cut two dozen positions at its Raleigh headquarters.

"The Healthcare management team has focused on stabilizing the business and aligning the organizational structure (for) faster growth, efficiency and lower operating costs," Misys CEO Mike Lawrie said in prepared remarks Thursday following the company's six-month earnings release.

Lawrie is based at Misys in England. He said Misys Healthcare is "well positioned for growth."

Excluding non-recurring events, revenue for the U.S. health care business inched up 1 percent to $190 million in the fiscal first half from $188 million in the same period a year earlier.

Operating profit rose 59 percent to about $35 million from $22 million a year earlier, thanks mostly to streamlined operations and stronger sales to small businesses, said Vern Davenport, general manager of Misys Healthcare.

"This is a big turnaround from the previous declines we had incurred," said Davenport, who initiated the turnaround plan shortly after joining Misys from Eastman Kodak 10 months ago.

Misys Healthcare makes software that helps doctors and other health care providers track patient records and manage business operations. The company employs about 730 people in Raleigh and has several dozen open positions, though Davenport declined to say how many will be filled this year.

"We're making tremendous progress against the plans that our new management team put in place," he said.

Since June, Misys has added several high level executives to the Raleigh management team. Sales chief Michael Etue was hired in July from Eclipsys Corp., a major competitor. Chief financial officer Ron Scarboro joined in October from TriZetto Group, and strategy and product-development chief Michael Raymer joined in November from GE Healthcare Systems.

The new hires were key to reshaping the business around small and medium health care practices.

Misys launched Misys MyWay in October. The Web-based software is geared for small organizations. They can subscribe to the software service as needed and avoid large outlays on licensing and IT infrastructure.

Looking forward, Davenport hopes to add a new services executive to help steer growth, he said.

"We have much work to do but we're on track or ahead on just about every element," Davenport said.