Emmis Acquisition Corp. Annual Report 2021

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FY2021 Annual Report · Emmis Acquisition Corp.

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Moving
forward

EMIS Group plc
Annual report and accounts 2021

Better care through
technology innovation

HIGHLIGHTS

Business
Strong results with performance above expectations.

• Increased dividend for the eleventh consecutive year

• Double-digit revenue growth in EMIS Enterprise, now accounting for more than 40% of profit

• 27 customers now using EMIS-X Analytics, 12 in EMIS Enterprise and 15 in EMIS Health

(2020: 25 pilot customers) with good potential for growth

• Post year end acquisitions of Edenbridge Healthcare and FourteenFish to grow EMIS Enterprise,

enhancing the Group’s data, analytics and digital portfolio and strengthening capabilities

• As part of EMIS’s Integrated Care Systems (ICS) strategy, continuing to deliver integrated care
with EMIS-X interoperability technology enhancements released in key markets through 2021
and 2022 to date

• Supported the NHS in delivering more than 100 million Covid-19 vaccinations (86% of the total)

Financial ancial

Total revenue

£168.2m +6%

Recurring revenue1

£134.8m +4%

Reported operating profit

Adjusted operating profit1

£35.8m -3%]

£43.5m +11%

Reported operating margin

Adjusted operating margin1

21.3% -116bps

Reported cash generated
from operations

£50.1m -22%

Reported EPS

46.2p -4%

25.9% +125bps

Adjusted cash generated
from operations1

£46.0m -22%

Adjusted EPS1

56.1p +10%

Net cash1

Total dividend for the year

£64.0m +21%

35.2p +10%

1 Recurring revenue, adjusted operating profit, adjusted cash generated from operations, adjusted
EPS and net cash are all alternative performance measures. See page 22 for further details and
reconciliation to the relevant IFRS number.

Strategic report

IFC Highlights
1
2
4
5

Strategic overview
At a glance
Investment case
Environmental, social and governance
(ESG) summary
Chair’s statement
Chief Executive Officer’s statement
Business model

6
8
10
12 Stakeholder engagement
16
18
20 Key performance indicators
22 Alternative performance measures (APMs)
24 Financial review
28 Operational review
32 Principal risks and uncertainties
38 Viability statement
39 ESG report

Markets
Strategy

Governance

50 Board of Directors
52 Chair’s introduction to governance
53 Corporate governance statement
59 Report of the audit committee
64 Report of the nomination committee
66 Report of the remuneration committee
69 Directors’ remuneration report
82 Directors’ report
85 Statement of Directors’ responsibilities

Financial statements

86 Independent auditor’s report
93 Group statement of comprehensive income
94 Group and parent company balance sheets
95 Group and parent company
statements of cash flows

96 Group and parent company statements

of changes in equity

97 Notes to the financial statements
119 Five-year Group financial summary
120 Shareholder information
IBC Glossary

Visit our website at
www.emisgroupplc.com

Visit our online report
ar21.emisgroupplc.com

Strategic overview

Our purpose

TO BE THE LEADING PROVIDER OF INNOVATIVE HEALTHCARE
TECHNOLOGY THAT IMPROVES PEOPLE’S LIVES

At a glance page 2

Our values

RESPONSIBLE
COLLABORATIVE

RESPONSIBLE

SUPPORTIVE

TRANSFORMATIVE

Business model page 10

Our integrated care strategy

SUSTAINABLE
FINANCIAL GROWTH

TECHNOLOGY
INNOVATION

USER, CUSTOMER AND
PARTNER EXPERIENCE

ESG

Strategy pages 18 to 19

Our ESG priorities

Our environmental
responsibilities
Establishing a sustainability
policy for our business

Delivering social value
to our community
Doing the right thing for
UK healthcare and the global
communities in which we
work and live

Our people and culture
Creating a strong working
culture of people united by
our business purpose

Our responsibilities
as a business
A high standard of clinical and
data governance underpins
everything we do

ESG pages 39 to 49

EMIS Group plc | Annual report and accounts 2021STRATEGIC REPORT

At a glance

OUR PURPOSE

To be the leading provider of
innovative healthcare technology
that improves people’s lives

Integrating care settings to
improve patient experience
and health outcomes

Empowering people through online
access to clinically authored
content and approved services

Delivering insight for clinicians,
research and life sciences to
improve UK health and wellness

SEGMENTS

EMIS HEALTH

Primary care

49%

of revenue in 2021

#1 in primary care

Community care

of revenue in 2021

#2 in community

Acute care

of revenue in 2021

#1 in A&E

Business areas where revenues are generated from delivering core software and ancillary services to NHS organisations.

EMIS ENTERPRISE

Medicines management

Partners, analytics and other services

Patient-facing services

23%

of revenue in 2021

11%

of revenue in 2021

#1 in community pharmacy
#1 in community pharmacy service

148 accredited partners
27 customers using EMIS-X Analytics

#1 independent patient services app

management solutions
#2 in hospital pharmacy

Business areas where revenues are derived predominantly from business-to-business (B2B) healthcare sector sources.

BRANDS

The clinical software business,
supplying essential technology to
10,000 healthcare organisations
across every major UK health sector
for front line clinical care and to
facilitate health research.

The UK’s leading independent provider
of patient-centric medical and wellbeing
information for the UK public, as well
as digital front door access to NHS and
private services provided in primary care
and community pharmacy settings.

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORTEMIS-X

EMIS-X ANALYTICS

Seamless interoperability, digital access and
intelligent analytics will drive the integrated care
transformation mandated by the NHS. EMIS-X will:

EMIS customers and partners need healthcare
insights that improve patient outcomes and speed
up essential research. EMIS-X Analytics will:

• Provide joined-up care across settings with fast healthcare

• Provide research models that improve the future of UK

interoperability resource (FHIR) enabled integration;

clinical research;

• Improve interactions and outcomes for patients and clinicians

• Enable meaningful insights into NHS healthcare challenges; and

with better digital access; and

• Facilitate life sciences and academia to support better health

• Drive NHS efficiency and process improvement.

outcomes for the UK population.

Technology to power the future of healthcare
EMIS-X is at the heart of EMIS’s cloud and technology refresh
strategy. EMIS-X is a platform upon which all new developments
are based, using the latest trusted and secure technology to
empower healthcare professionals.

All clinicians need fast and secure access to a broad range of
patient data to deliver informed patient care. There is no time to
wait for information anymore – and there is no need to with the
modern technology available today. Removing information barriers
across the entire healthcare landscape is essential to modernise
the NHS. With the EMIS-X platform, the Group will revolutionise
the concept of integrated care.

EMIS’s market-leading clinical systems have always been designed
to improve patient outcomes and safety. EMIS-X technology builds
on this to enhance existing systems to further advance clinical
capabilities and help meet the evolving needs of healthcare teams.

Insights leading to better patient outcomes
Analysis of patient data offers huge potential for the NHS to best
manage its resources as it tackles the long-term challenge of
resourcing rising demand for healthcare services.

It provides real-world evidence from patient records that make it
easier for services to be tailored to clinical need and for research
programmes to develop effective treatments.

Everyone stands to benefit: the NHS can plan resources better
and the life sciences industry can accelerate the development and
delivery of more effective treatments through data-driven insights
as they connect the dots between patients, healthcare providers
and industry.

EMIS-X Analytics sits at the heart of this, providing both the
secure and seamless access to data and the powerful tools needed
to generate meaningful insight.

4.2bn

1.3tn

clinical attachments in EMIS-X document storage

clinical events and interactions held in EMIS-X Analytics

12.6bn

55bn

consultations available to securely share using EMIS-X

clinical observations available for secure ethical research

EMIS Group plc | Annual report and accounts 2021

Investment case

Our investment case

STRONG POSITIONS IN
SPECIALIST MARKETS

Markets page 16

• Market leader delivering at scale: growing or

maintaining market shares, number one or two
in key UK healthcare markets

• Unique in the breadth of markets served

• Aligned with the NHS Long Term Plan, providing
growth drivers for increasing investment into
technology for the NHS

years providing front line
technology to the healthcare
sector

GROWING THE BUSINESS

• Strong performance in 2021
• Growth in multiple markets

100m

Covid-19 vaccinations
supported by EMIS

£64.0m

net cash

• Investment in technology roadmap with the potential

for acceleration to drive growth in EMIS Health

• Double-digit growth in the areas of patient-facing

services, analytics and pharmacy in EMIS Enterprise

• Acquisitions accelerate speed to market

• Unbroken track record of increasing dividend each

year since IPO

• Compound growth rates since flotation in 2010 of
10% in revenue and 8% in adjusted operating profit

• Strong balance sheet with no debt

• Bank facilities of up to £60m in place

• Investment will not impact progressive dividend

policy or require significant leverage

• Robust business model with high recurring revenue,

typically around 80%

• Long-term framework agreements in place across

80%

recurring revenue

major markets

• Loyal customer base with low churn rates

• Consistent strong cash generation

• Technology and cloud refresh strategy will increase

efficiency and expand margins in the mid term

• Focussed on developing new, standards-based,

capabilities to connect care settings across the UK

• EMIS-X platform will drive growth in both EMIS

Health and EMIS Enterprise

£21.3m

research and development
(R&D) investment

Strategy page 18

EXCELLENT FINANCIAL
STRENGTH AND
TRACK RECORD

KPIs page 20

HIGH LEVELS OF
EARNINGS VISIBILITY
AND CASH GENERATION

Business model page 10

NEW TECHNOLOGY
DRIVING FUTURE
GROWTH
AND EFFICIENCY

EMIS-X Analytics case study page 23

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORTSTRATEGIC REPORTESG summary

Our environmental responsibilities

Delivering social value to our community

Our priority
A commitment to continue reducing environmental impact
and to measure improvement.

Our priority
Every initiative, development, product and service EMIS
produces has a positive impact on UK society.

Our achievements
• 56% of EMIS’s fleet now hybrid.

• 60% of UK electricity consumption from renewable/low

carbon providers.

• 10.5% reduction in total energy consumption for the UK.

Our ambition
• Become carbon neutral by 2030.

Our achievements
• 100 million Covid-19 vaccinations recorded on

EMIS software.

• 1.5 million people identified for priority vaccinations through

EMIS-powered research.

• 15.7 billion prescription items processed through the lifetime

of EMIS Web.

Our ambition
• Improve NHS outcomes for individuals and address

health inequality.

Learn more on page 42

Learn more on page 44

Our people and culture

Our responsibilities as a business

Our priority
To live the EMIS Group values and create a diverse and positive
culture in which EMIS people can thrive.

Our priority
Clinical safety, data security and proactive risk management is
at the heart of everything EMIS does.

Our achievements
• 87% of employees agreed that EMIS met its targeted

Our achievements
• 16% reduction in gender pay gap as published in 2021.

engagement metrics.

• 20 mental health first aiders.

• 121 members of the clinical team meticulously oversee new

developments.

• 50 employee forum meetings held during 2021.

• 99% of staff trained in governance policies.

Our ambition
• Become an employer of choice by 2025.

Our ambition
• Continued commitment to high standards of governance

in every area.

Learn more on page 46

Learn more on page 48

More information on ESG can be found in the ESG report on pages 39 to 49

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORT

Chair’s statement

Committed
to integrated
healthcare

Dear Shareholder
I am pleased to report that EMIS Group has performed strongly
during 2021, benefitting from 6% revenue growth and 11% growth in
headline adjusted operating profit, as well as 80% recurring revenue.
The reported operating profit was unchanged. Outcomes4Health,
the system we added to our portfolio when we acquired Pinnacle in
early 2020, has helped to power and record more than 100 million
Covid-19 vaccinations in England. Thanks to the excellent work of
the senior leadership team and the whole workforce, EMIS acted
quickly and effectively, with flexibility, responsiveness and resilience
during the period to adapt Outcomes4Health ready for day one of
the vaccination programme.

During the second year of the pandemic, the Group continued to
perform strongly as a mainly homeworking organisation. EMIS is
focussed on employee health and wellbeing at every level of the
business. The past year provided another opportunity to see one of the
key strengths of EMIS’s culture as the organisation pulled together to
support colleagues and customers.

Our focus remains on our future growth strategy in alignment with NHS
policy, patient demand for better healthcare and new opportunities
in EMIS Enterprise markets. We continued to invest significantly
in the best talent and new capabilities across the business. We are
making good progress with technology programmes, including EMIS-X
Analytics, as we continue to innovate and invest in new technologies.
We have invested time and resource into delivery and implementation
too, so as well as building world-leading clinical systems, they are
delivered well to customers.

Purpose and stakeholder engagement
Our purpose is to be the leading provider of innovative healthcare
technology that improves people’s lives, underpinned by our core
values. We are responsible in our approach to supporting UK
healthcare and we work collaboratively and with integrity to deliver
the Group’s purpose. As a business, collectively we are supportive of
both our employees and customers as we play our part to transform UK
healthcare with our technology.

We are mindful of our stakeholders at every level of the business,
from customers to partners, shareholders to employees and the wider
communities in which we work and live. We listen to their needs and
build stakeholder requirements into each element of our strategy. Every
stakeholder is impacted by our ESG strategy and more detail on how
carefully we consider our responsibilities as a business can be found in
the ESG report on pages 39 to 49.

People and culture
The Board is focussed on culture and workforce engagement and we receive
regular updates that allow us to take into consideration the employee voice
when making decisions. Both the regular internal surveys and the employee
forum meetings provide valuable insight into the priorities and concerns
of our people. This includes employee engagement and mental health and
wellbeing, which are key Board priorities.

Diversity and inclusion is an important focus for the Board, including
both gender and ethnicity. To broaden diversity in senior roles, focus
is being placed on succession planning, in-house talent development
programmes and recruitment strategies to increase representation.
For example, in line with the Hampton-Alexander review for FTSE 350
boards, our aim is to have at least 33% female representation on the
Board by the end of 2023.

Board
We have a well-balanced and diverse Board, which was strengthened
further in the year. The Board has a wide range of experience that
facilitates broader perspectives, encouraging new innovative strategies
that are necessary to stay ahead.

On 1 March 2021, JP Rangaswami joined the Board as a Non-executive
Director and stood for election at the 2021 Annual General Meeting
(AGM). On 1 October 2021, Denise Collis joined the Board as a Non-
executive Director and Chair to the remuneration committee. Denise
will stand for election at the AGM on 5 May 2022. Andy McKeon
retired from the Board on 28 February 2022, having served for nine
years. I would like to thank Andy for his contribution to EMIS Group
over an extended period.

Governance
As an AIM-quoted company we have chosen to apply the 2018 UK
Corporate Governance Code 2018 (“the Code”). Compliance is set out
in the governance report on pages 52 to 58.

During the year, a formal performance evaluation of the Board and
committees took place to assist in their development. The results of the
evaluations confirmed that in the opinion of the respondents the Board
and committees continue to function effectively and that there are no
significant concerns among the Directors about their effectiveness.
Further information is set out in the corporate governance report on
pages 52 to 58.

EMIS Group plc | Annual report and accounts 2021

Our focus remains on our
future growth strategy in
alignment with NHS policy,
patient demand for better
UK healthcare and new
opportunities in EMIS
Enterprise markets.”

Sustainability
ESG matters are a priority for EMIS Group. The Board set up a
dedicated ESG committee at the end of 2021 to oversee the Group’s
approach and drive forward positive change in each area. Creating
and maintaining a sustainable business model and considering the
wider impact we have on society as a whole are key to the Board
when making decisions, as we balance business growth with our
responsibilities as an organisation. Further information on our ESG
strategy and achievements to date can be found on pages 39 to 49,
including details of our ambition to be carbon neutral by 2030.

Dividend
A final dividend of 17.6p per share is recommended by the Board.
The dividend progression is in line with the capital allocation policy
adopted by the Group and will result in a total dividend for the year
of 35.2p. Subject to approval by shareholders at the AGM, the final
dividend will be paid on 17 May 2022 to shareholders on the register
on 19 April 2022.

Outlook
As we pass the two-year mark since the emergence of Covid-19, we
expect it to remain a significant issue for the healthcare industry. The
future remains somewhat unpredictable but we remain committed to
investment in technology and innovation that our customers need to
deliver world-class healthcare.

The talent and the commitment of our people remain our key strengths
as they are the drivers of the Group’s purpose. Our focus remains on
investment in engaged, motivated and capable employees in both the
UK and India. I’d like to thank the Executive leadership team and all of
our staff for their high levels of dedication and resilience throughout
the year. I’d also like to extend thanks to our customers and partners for
their confidence and support as we tackle this challenging time for the
NHS together.

Patrick De Smedt
Chair
24 March 2022

Our ethical culture

EMIS’s open, forward-thinking and ethical culture is central to
everything we do. As a healthcare company, helping to improve
patient care through technology is the lifeblood of every decision
we make.

From every corner of the business we’re committed to the highest
standards of clinical safety and data security. We care about the
little details that make a big difference.

That same ethos is reflected in how we view employee
engagement and support a positive working culture across the
business. This has come even more sharply into focus in the last
two years during the pandemic, when the Board has proactively
prioritised employee wellbeing and mental health as we navigated
the new circumstances that impacted both work and family lives.

It’s part of our culture to take employee feedback, views,
concerns and ideas into all key decisions relating to staff. This is
particularly important when making large-scale decisions such
as moving to becoming a mainly homeworking business and
how best we reopen our offices as collaboration hubs. Employee
feedback surveys, forums, open Q&A sessions with the senior
leadership team and a strong culture of feedback through
team meetings mean that as a business we are always open to
listening and looking to make positive change to create a working
environment that supports our employees to thrive at work and
achieve their career goals. We’re also not afraid of having difficult
conversations, and during 2021 we invited our employees to lead
the way to voice their views through our diversity and inclusion
forums.

The Board recognises that our employees do an incredible job,
and I would like to thank them for their fantastic contribution in
the last year and for their positive engagement with our strong
working culture.

Patrick De Smedt
Chair

EMIS Group plc | Annual report and accounts 2021STRATEGIC REPORT

Chief Executive Officer’s statement

A positive year
of good growth

Overview
It has been a positive year of good growth and strong results. We are
building growth momentum with results above expectations for 2021.
We have seen trading return to a more normal pattern in EMIS Health
following the impact of the pandemic in 2020. Boosted by Pinnacle, we
also benefitted from double-digit growth in EMIS Enterprise, which now
accounts for more than 40% of our profits.

I’m incredibly proud of the EMIS team; we have lived our values during
2021 and moved forwards with our vision to be the leading provider
of innovative healthcare technology that improves people’s lives. We
continue to strive to operate to the highest standards of clinical safety,
data security, business integrity and healthcare ethics.

Formalising our ESG strategy
EMIS has had sound governance and social value principles embedded
in the culture of the organisation for many years. During 2021 we
formalised this into an ESG strategy, with our environmental target for
the business to become carbon neutral by 2030. The Group’s new ESG
committee will ensure that we continue to build social value targets and
ambitions into our corporate strategy.

Our Executive team is also committed to managing EMIS’s
environmental impact, continuing with our very important social
purpose and having put in place best practice proactive governance
policies and processes. We see ESG as central to our decision making
and the way we run our business.

More information on our ESG strategy and achievements to date can
be found on pages 39 to 49.

An inspirational place to work
Our continued goal is to create an inspirational culture and working
environment that will attract and retain the best talent. Our people
are the energy and the driving force behind our corporate purpose.
By creating an inspirational place to work, we can enable our people
to fulfil individual career ambitions at the same time as collectively
taking the business to the next stage of growth. As we continue
our journey to become an employer of choice, our focus is on the
continued development of our business culture with high levels of
staff engagement, team collaboration, individual empowerment and
increasing rewards.

Continuing to support our customers through Covid-19
Supporting our customers is one of the things we do best at EMIS.
Facing the challenges of the last two years alongside the NHS has
strengthened our relationships with our customers and partners at both
a strategic and end user level. As a business we have once again pulled
together to do the right thing for the health of the UK population,

EMIS Group plc | Annual report and accounts 2021

further strengthening our culture and uniting in a strong sense
of purpose.

Throughout 2021 EMIS Group’s Outcomes4Health software, acquired
when Pinnacle joined the Group in early 2020, has supported the
largest vaccination programme in NHS history and continues to evolve
through the booster drive. Outcomes4Health was the only system used
to support all non-hospital vaccinations for the first seven months of
the programme and has to date supported 100 million vaccinations,
representing 86% of the total delivered.

The EMIS-X platform and analytics applications have been pivotal
to many essential Covid-19 research programmes. This includes the
national OpenSAFELY programme, helping to provide powerful,
data-driven insight based on real-life GP interactions into not only
Covid-19 but also wider public health issues. This in turn has generated
actionable insight that we have deployed back into core GP systems,
with updated prescribing guidelines and protocols on Long Covid. This
is a true representation of how research can make a rapid and positive
impact on patient care and outcomes.

Technology investment to drive growth
Technology development has continued in line with our product
roadmap and we remain committed to investment to drive growth,
continuing to build momentum in the key areas of interoperability, elite
partners, digital services for patients, community pharmacy and data
and analytics.

We have completed the first phase of our EMIS-X technology
refresh, with the next phase of cloud infrastructure upgrades in EMIS
Health planned over the next two years to increase efficiency and
expand margins.

We upgraded our A&E system to enable greater interoperability and
updated our flagship GP software to increase customer satisfaction.
We released new product enhancements for the community
pharmacy market and added a broad range of services into our Patient
marketplace, furthering the streamlined pathway for patients to book
both NHS and non-NHS services delivered by community pharmacies
and private healthcare providers.

Since the launch of EMIS-X Analytics ahead of schedule in 2020, we
have moved further into the research and life sciences market during
2021. We are underway with a number of new projects with major
global life sciences organisations including Pfizer and Bristol Myers
Squibb. These projects have helped us further refine our technology
and proposition, while generating a lot of interest for EMIS-X Analytics
capability in this new market.

Every new development and software release, large or small, is aligned
with our corporate purpose, to be the leading provider of innovative
healthcare technology that improves people’s lives.

Interoperability to support integrated care
During 2021 we have seen many integration and interoperability
projects developed and released to the market, providing essential digital
pathways to connect healthcare processes.

The NHS has a strategic drive to deliver integrated healthcare to increase
efficiency and with our strong market shares in major healthcare markets,
we are well placed to help achieve this aim. We remain focussed on
delivering the future technology mandated by NHS policy makers to
achieve their long-term goals.

For example, integrated care will be critical for the emerging ICS
organisations as they take control of NHS budgets to deliver co-
ordinated, informed care underpinned by interoperable technology.
EMIS is well placed to help, with 69% of ICSs using EMIS systems in
three or more healthcare markets.

More information on the interoperability technology released during
2021 can be found in the operational review on pages 28 to 31.

Post year-end acquisitions of Edenbridge Healthcare
and FourteenFish
Part of the Group’s strategy is to grow by acquisition in the EMIS
Enterprise sector, particularly focussed on the growth areas of data
and analytics and integrated healthcare. In January 2022, the Group
completed the acquisition of Edenbridge Healthcare Limited, a leading
provider of business intelligence tools for GP practices, federations and
commissioners. It will expand our capabilities in the growing data and
analytics markets by providing real-time insight to support GP practice
access, efficiency, transformation and workforce planning.

EMIS Group acquired the business for £4.0m in cash paid from the Group’s
existing cash resources, with further cash consideration of up to £6.0m
payable on the attainment of certain performance targets. Edenbridge
Healthcare’s revenue last year was £1.0m with a profit of £0.2m.

The Edenbridge team has integrated well into the organisation, with
an assimilation of cultural values and a common goal to integrate
technology to improve patient healthcare. Integration work between
product sets is underway.

In March 2022 the Group completed the acquisition of FourteenFish
Limited, adding a specialist knowledge of GP medical appraisals and
training to the Group. FourteenFish is the chosen training system of the
Royal College of General Practitioners (RCGP)’s training and will join
EMIS Health to strengthen the Group’s training proposition.

FourteenFish was acquired for £15.8m in cash paid from the Group’s
existing resources. Fourteen Fish’s revenue last year was £2.4m, with a
profit of £1.4m.

Summary and outlook
It’s an exciting time for EMIS Group as we move towards the next stage
of our evolution. Our focus on interoperability, integrated care and data
analytics positions us well for growth.

We are confident of delivering a higher level of consistent revenue
growth, as well as expanding margins by completing the next stage
of our technology and cloud refresh strategy over the coming years.

The pandemic has demonstrated what is possible with a shared
objective across government, the NHS and healthcare technology
suppliers. The industry has embraced greater interoperability and
collaboration, resulting in the fast delivery of both essential technology
and actionable data insights to improve population health. This has
accelerated the adoption of digitisation and analytics across the NHS.

Technology remains critical to the NHS as it looks to life beyond the
pandemic. EMIS strategy and technology development remain closely
aligned with NHS policy, supporting both end users and strategic NHS
organisations alike, to deliver the shared goal of better health.

Andy Thorburn
Chief Executive Officer
24 March 2022

What ESG means to me

I feel very strongly that at EMIS we always do the right thing.
It’s in the very fabric of our organisation and it inspires me
every day.

Ever since EMIS was created in the late 1980s by two GPs,
supporting better patient care has grown into a powerful energy
that runs through the organisation. Many people have played
their individual part but the energy of doing the right thing is
bigger than any one of us. It inspires our teams and makes us truly
care about the part we play in improving people’s health on an
individual and national level.

Responsible, one of our corporate values, is something I see
across all of our teams. The commitment to customers, to
colleagues and to doing the right thing is inherent in EMIS’s
culture and I’m proud to be the current custodian of a business
with a long history of making positive social impact.

Reviewing EMIS’s contribution to social value this year as we form
our ESG strategy has been a moment to sit back, take stock and
realise just what we have already achieved for the greater good
of UK healthcare and how much potential there is for us to do
even more. I’m proud to take forward our ESG strategy to the
next stage, guiding our culture of doing the right thing to create
even more positive change in wider environmental, social and
governance matters.

Andy Thorburn
Chief Executive Officer

121

people in the clinical team
keep us focussed on doing
the right thing

EMIS Group plc | Annual report and accounts 2021Business model

Joined-up healthcare
through technology

OUR KEY INPUTS

• Innovative integrated
technology services.

• Highly skilled people.

• Trusted brand.

• Strong relationships strategically

aligned with government, partners
and the markets we serve.

• Strong revenue visibility.

• Responsible leadership.

• Strong culture of putting both
patients and customers first.

Markets page 16

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Our four key values underpin everything we do, throughout every area of the business

Collaborative
EMIS Group is focussed on working as one joined-
up team towards collective goals that deliver the
Group purpose to deliver social value by enabling
better care through technology innovation.

Supportive
EMIS Group has a strong culture of caring for
employees and customers alike. Throughout the
business, people care about and encourage others,
so everyone can perform at their best.

Responsible
EMIS Group employees are honest and transparent
and act with integrity. EMIS people take ownership
of the fact they have an important job to do in
supporting UK healthcare.

Transformative
EMIS Group helps to improve UK healthcare
through its products and services. EMIS employees
have a clear understanding of how they can
contribute to make a real difference.

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORT
How we generate revenue

How we add value

• Software subscription and support –

recurring.

• Interface and connectivity charges –

mainly recurring.

• Other services – mixed recurring/

non-recurring.

• Perpetual licences, training,

consultancy and implementation –
non-recurring.

• Hardware and related services –

mainly non-recurring.

8282+

Recurring revenue: 80%

Non-recurring revenue: 20%

Financial review page 24

CUSTOMERS
We help make integrated care a reality
across the healthcare industry.

CLINICIANS
Our systems and services are designed
to support healthcare on the front line.

69%

of ICSs use EMIS systems in three
or more healthcare markets

10,000

healthcare organisations rely
on our clinical systems daily

UK PUBLIC
We provide trusted healthcare
information and digital services
for the UK general public.

SHAREHOLDERS
We deliver long-term growth
in dividends and share price.

14 million

Patient Access registered users

35.2p

dividend for the year

B2B
We provide B2B systems and services
to enterprise customers in the
healthcare market.

EMPLOYEES
Our employees live the EMIS Group
values and put customers and patient
care at the heart of everything we do.

5,339

community pharmacies use our
software to deliver better customer
service and drive up revenue

31%

of employees are dedicated to front
line customer care

Why users, customers and partners choose us

Clinically focussed
We enable clinicians to provide safe and
efficient care through excellent software
and services – helping patients live longer,
healthier lives.

Trusted supplier
Our software and services are used in every
major healthcare setting – from GP surgeries
to high street pharmacies, community,
hospitals and specialist services.

Joining up patient care
Through innovative technology, we
give healthcare professionals access to the
information they need to provide the best
possible front line healthcare.

Care about our customers
Clinically led development teams work
with our customers to develop systems.
That is why we consistently meet the
needs of end users.

Innovative
We are always looking at future technologies
and trends to make sure we develop
ground-breaking services that benefit
patients, clinicians and NHS organisations.

Meaningful healthcare insight
We facilitate research and insight through
analytics, helping the NHS, life sciences
and academia discover actionable insight
to improve patient outcomes.

EMIS Group plc | Annual report and accounts 2021

+
18
18
+
+
C
C
Stakeholder engagement

Connecting with
key stakeholders

The Board reviews key topics through the year, carefully considering
stakeholder interests when making decisions on strategically important
matters as the Directors discharge their duties in alignment with
Section 172 (s.172).

These pages outline the priorities of employees, customers and
shareholders, how the Board engages with these groups and the
impact this has had on decision making throughout the year.

Regular updates from the Group
executive team (GXT)
Throughout the year, the GXT updated the
Board with information on important areas
of business focus, in particular those relating
to our key stakeholders as well as ESG
matters. This ensured that the Board had a
good understanding of the priorities of each
stakeholder group to aid decision making for
both the short- and long-term success of the
business model.

The Board had a particular focus this year
on diversity and inclusion, data security and
customer satisfaction, as well as consideration
of M&A and the medium- to longer-term
implications of Covid-19 on the business
model and strategy.

Direct engagement of
Board members
The Executive Directors are in daily
contact with staff from across the business
to understand key topics relating to both
employees and customers, sharing regular
updates to the Board. The national forums and
regular employee engagement surveys provide
insight into employee views on both internal
and customer-focussed matters. Jen Byrne
was the designated Non-executive Director
during the year and attended the national
forum, providing feedback to the Board.

Regular reporting on support performance,
customer service and the close collaboration
between EMIS and its strategic customers
keeps the Board up to date on customer
trends and feedback.

A number of Board members had meetings
with shareholders during the year to discuss
strategy and remuneration.

S.172 statement UK
Companies Act 2006
The Board recognises its responsibility
to take into consideration the needs and
concerns of its principal stakeholders as part
of its discussion and decision-making process.
As a Board and a business EMIS strives to care
for its colleagues, help customers deliver a
better experience for healthcare professionals
and their patients, as well as supporting the
wider community. Details on how the Group
engages with its stakeholders can be found
throughout the strategic report on pages 4 to
49 and in the corporate governance statement
on pages 53 to 58.

BOARD CONSIDERATIONS AND DECISIONS

Below is a list of some of the key topics that have been a focus for Board in 2021, outlining how consideration of stakeholder interests has
influenced decisions.

Strategy
• Considered the importance of ESG to

Governance
• Data security updates were delivered

long-term success and decision to embed
ESG targets into the business strategy.

• Considered linking ESG objectives to

remuneration.

• Considered the impact of Covid-19
on the strategy and business risks.

• Endorsed the latest market positioning

and customer focus.

• Considered Board and committee

feedback on the strategy.

• Discussion on the technology strategy and
decision to adopt Scaled Agile Framework
(SAFe) methodology to improve delivery.

throughout the year, with consideration of
stakeholder impact and mitigations against
emerging issues.

• Received regular updates from the risk

management committee (RMC).

• Engaged with shareholders to discuss

remuneration.

• Decision to improve the Share Incentive

Plan (SIP) to provide one matching share for
every two shares purchased by employees.

• Agreed the appointment of Denise Collis
to join the Board on 1 October 2021.

People and culture
• Consideration of wellbeing and decision

to focus on improvements to engagement
and communication.

• Considered diversity and inclusion across
the business and decision to have regular
diversity updates at Board level in future.

• Considered how to improve the diversity
of the Board and decision to set target for
improvement by 2023.

• Considered succession planning at senior
levels of the business and decision to
reduce single points of failure across the
organisation.

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORTKEY TO STRATEGIC PRIORITIES

Sustainable financial growth

2 Technology innovation

3 User, customer and partner experience

4 ESG

Suzy Foster
Chief Executive Officer EMIS
Health and EMIS Enterprise

Engagement in action

“Strong customer relationships are our
foundation when it comes to delivering
outstanding healthcare solutions. We live our
values in everything we do, as we strive to
make our customers and partners happy in
every interaction they have with EMIS.

“We have seen a great response from
customers during 2021 to the improvements
we’ve made. Excellent service will grow
our business and I have tasked our teams
with doing even more in 2022 as we make
excellence normal and seek to raise the bar
everywhere we can.”

Impact of Covid-19 on engagement

• Rapid adaptation of products and services
to meet specific Covid-19 requirements
helped foster closer working relationships at
strategic level.

• Mixture of digital and face-to-face customer
engagement, considering restrictions and
customer preferences.

Customer engagement
helps us deliver our
purpose: the better
we can support
customers the more
they can focus on
patient care and
improved outcomes.”

CUSTOMERS

Link to strategy

3 4

What is important to them

How we engage

Outcomes

• Technology systems that improve patient
outcomes at strategic and end user level.

• Satisfaction with both products and

customer services.

• Two-way collaborative relationships

focussed on shared goals.

• Feedback gathered via customer-facing

• More regular customer communications

teams is regularly reviewed and considered
by the senior team, GXT and Board.

• The Group undertakes customer satisfaction
surveys and analysis of support statistics to
drive continual improvement in customer
experience.

throughout the year including updates on
forthcoming releases and details of new
functionality.

• Improved time from software

development to release of new
enhancements to meet customer demand.

• The commercial team engages regularly

• Daily calls focussed on improving the

with strategic and national customers with
openness and transparency, in the spirit
of trust and collaboration to address the
healthcare challenges in each nation. This
has been particularly prevalent during
the pandemic.

• A wide range of communication channels

keeps customers up to date.

customer experience to ensure issues and
feedback are heard across the business
and acted upon promptly.

• Improved customer satisfaction scores.

• Two-way conversations on customer

priorities ensure that customer
requirements are built into new
enhancements by design.

EMIS Group plc | Annual report and accounts 2021

Stakeholder engagement continued

KEY TO STRATEGIC PRIORITIES

Sustainable financial growth

2 Technology innovation

3 User, customer and partner experience

4 ESG

Jacqui Summons
EMIS Group HR Director

Engagement in action

“We introduced the employee forums to
create a two-way dialogue between employees
and the leadership team in both the UK and
India. Employees are encouraged to openly
ask questions and share their views, and the
leadership team proposes new ideas to seek
and consider feedback. The discussion topics
are wide ranging and we follow up on all actions
to ensure trust and integrity.

“Representatives from all local forums join
regular Group forums chaired by the Chief
Executive Officer or a member of the GXT.
Every member of the GXT has chaired or
is due to chair a forum in 2022, providing
greater engagement and visibility of the
leadership team.”

Impact of Covid-19 on engagement

• Big focus on digital communication to

increase engagement.

• Adaptation of offices to collaboration hubs to
offer the advantages of both teamwork and
homeworking going forwards.

Our purpose unites our
employees and creates
stakeholder value:
collectively we can
all feel proud of how
we’ve supported our
customers, particularly
through the pandemic,
finding meaning
in our individual
contributions.”

EMPLOYEES

Link to strategy

3 4

What is important to them

How we engage

Outcomes

• Feeling engaged with the business and

• The employee forums increase

its overall purpose, especially during the
lockdown phases in both the UK and India.

synergy between employees and
the leadership team.

• Wellbeing and work-life balance.

• The designated Non-executive Director

• Feeling valued, trusted and empowered.

• Being fairly rewarded and incentivised for

their work.

attended the national employee forum and
fed back to the Board in 2021.

• Frequent concise employee surveys

captured direct feedback as the business
navigated the second year of the pandemic,
with a particular focus on wellbeing.

• The business adapted to the changing

circumstances of the year with a mixture
of digital and face-to-face engagement,
as appropriate and in alignment with
government guidance in both the UK
and India.

• Greater Board understanding

of employee concerns.

• More representation by the senior

leadership team at the employee forums
to build relationships and increase visibility.

• Addition of new ESG-focussed benefits
in alignment with employee feedback.

• Improvements to benefits for employees
in both the UK and India, considering
specific requirements of the different
cultures and legislations.

• Reopened the UK offices as collaboration
hubs in alignment with the feedback on
how teams wanted to use them.

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORTPeter Southby
EMIS Group
Chief Financial Officer

Engagement in action

“The spotlight has been on the healthcare
technology industry during the pandemic. It has
been a time of adaptation and growth as we
have supported our customers and colleagues
through unprecedented circumstances.

“It has been our priority to take both
shareholders and potential shareholders along
the journey with us. We have continued our
open and transparent approach to investor
communications, particularly in the weeks
following the full and half year results.
Andy Thorburn and I take the time to meet
shareholders (virtually or in person) to answer
questions, provide clarity and share as much
information as we are able to within the confines
of commercial confidentiality.”

Impact of Covid-19 on engagement

• Regular communication on the impact of

Covid-19 on the business.

• Mixture of digital, hybrid and face-to-face
meetings as circumstances changed during
2021 to accommodate both restrictions and
investor preferences.

EMIS Group’s purpose
creates shareholder
value as it
demonstrates our
commitment to the
ethics that drive our
business, which
creates a sustainable
business model in the
long-term.”

SHAREHOLDERS

Link to strategy

3 4

What is important to them

How we engage

Outcomes

• Staying up to date with EMIS Group
strategy and business performance.

• Understanding the impact of Covid-19

on the business and on broader
market trends.

• EMIS’s ESG strategy.

• Timely and relevant communication.

• Shareholder value.

• Understanding the remuneration policy

and management incentivisation.

• Thorough regular reporting content,

• The Group takes guidance from its

including the annual report and accounts
and half year report.

• Opportunity for direct one-to-one meetings

with the Executive Board is offered to
investors, potential investors and analysts.

• A multi-media approach with the use of

webinars and video interviews to accompany
the full and half year results.

• Feedback from investors following the twice
yearly roadshow meetings is shared with the
Board and senior team.

• The Group invited questions prior to the
AGM in 2021, which was held as a closed
meeting because of the pandemic.

advisers on shareholders’ priorities in
planning communications, to ensure
it addresses any new and emerging
key topics.

• This information is fed into all

communication channels, from digital
to multi-media to hard copy formats.

• EMIS Group won the “best investor
communication” category in the AIM
Awards for the third time in four years.

• Shareholder value was considered

throughout the year, with a particular
focus on the ongoing impact of Covid-19,
ESG matters and potential acquisitions.

EMIS Group plc | Annual report and accounts 2021

Markets

The digital
revolution

It has been another demanding year for the NHS as it tackles “the worst public
health emergency for a century.”* The second year of the pandemic saw the successful
mobilisation of the largest vaccination programme in NHS history, increased adoption
of technology and a growing concern for the long-term effects on the UK population
of healthcare resources being diverted away from other care areas to focus on Covid-19.

The health and wellbeing of the UK population remains high on
the government’s agenda, evidenced by a commitment to a 3.8%
increased spend on the NHS over the next three years. The
government’s September 2021 paper, “Build Back Better”, refers
to “an unprecedented investment in health and social care”.

In the autumn 2021 budget, Chancellor Rishi Sunak confirmed £2.1bn
for NHS IT upgrades and digital health technology to allow NHS staff
to spend more time caring for patients.

TECHNOLOGY AT THE CENTRE
Use of technology remains in the foreground: in his October 2021
speech “Using the power of technology to make the world a safer
and healthier place,” the Secretary of State for Health and Social Care
highlighted that driving digital healthcare remains a vital priority. He
told the audience of healthcare leaders: “Now we’ve seen what health
tech can do at a time when health systems around the world were
under incredible strain, we must build on the progress and deliver this
long-awaited digital revolution.”

USING ACTIONABLE DATA INSIGHT
TO IMPROVE HEALTHCARE
At the same time there is growing evidence of an increase in non-Covid-19
related healthcare conditions emerging from the gap in care during the
pandemic. For example, Cancer Research UK estimates that more than
45,000 fewer people started cancer treatment between the start of
the pandemic and March 2021 due to disruption to cancer screening,
diagnosis and treatment.

Increasingly it’s becoming clearer that collaboration between research and
life sciences, academia, the NHS and the technology industry is the best
way to address this challenge, with meaningful research into healthcare
data at scale.

Industry insight

3.8%

increased spend on
the NHS over the next
three years

£2.1bn

for NHS IT upgrades and
digital health technology

* Build Back Better, HM Government, September 2021.

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORTINTEGRATED CARE

Link to strategy

3 4

DATA-DRIVEN CARE

Link to strategy

3 4

Market drivers

• NHSX’s August 2021 paper, “What good looks like”, sets

• The Department of Health and Social Care (DHSC)’s March

out a framework for ICSs to lead the digital transformation
of the NHS.

• ICSs have a fundamental requirement for interoperable IT

systems to deliver local healthcare strategy.

• In late 2021 NHSX, NHS Digital and NHS England announced
they are to merge, highlighting the move towards greater NHS-
wide alignment of digital strategy.

• The UK government has promised to spend an extra £33bn per

annum on the NHS by 2023–2024.

• The “digital front door” for patients remains vital: the aim for

citizens to access and contribute to their healthcare information
is outlined in “What good looks like”.

• Digital consultations in primary care introduced during Covid-19

are set to continue for those who want them.

EMIS Group capabilities

• Strong relationships with national customers, working closely

with each UK region on strategic healthcare priorities.

• Leading positions in all major healthcare markets, meaning EMIS

is well-placed to facilitate integrated healthcare.

• Working in partnership with ICSs to enable integrated care

pathways at scale.

• Delivering against NHS Digital’s GP IT Futures requirements,

including those for interoperable clinical systems.

• EMIS-X technology is the foundation platform for seamless

wide-scale interoperability across multiple healthcare settings.

• EMIS is already enabling interoperability through its existing
systems including between GPs, patients and community
pharmacies and between A&E and 111 services.

• Connecting patients to both NHS and non-NHS healthcare

services through Patient Access, enabling self-service pathways.

• A range of digital-first consultation solutions for GPs and
community pharmacies, including online triage, integrated
telephony and video consultation.

• “Hub and spoke” technology and Patient marketplace services
support community pharmacies to move towards the service
provider model stipulated in the January 2019 NHS Long
Term Plan.

2021 paper, “Saving and improving lives: the future of UK clinical
research delivery” outlines the plan for the UK government to
create a patient-centred, pro-innovation and digitally enabled
research environment to embed effective research in the NHS.

• The Department for Business, Energy & Industrial Strategy
released “Life sciences vision” in July 2021, a policy paper
aiming to solve some of the biggest healthcare problems of this
generation, including cancer and dementia, by bringing together
the life sciences industry, NHS, academia and industry.

• The government’s life sciences investment programme brings
the total amount of funding available to the UK’s life sciences
companies to £1bn.

• “What good looks like” highlights that insights from data are
key to design and deliver improvements to population health
and wellbeing.

• “Build back better” outlines a new £50m research, innovation
and collaboration fund to support research and healthcare
institutions to improve health outcomes across the UK.

• NHS Digital is developing a Trusted Research Environment (TRE)
service to provide researchers with secure access to health and
social care data.

• The Control Of Patient Information (COPI) notices that enabled
widespread data sharing during the pandemic have set new
standards and expectations for data-driven healthcare.

EMIS Group capabilities

• EMIS-X technology is already being used for large-scale NHS
research and analytics projects, such as winter planning and
condition-specific risk stratification.

• EMIS is working with a number of research and life science
companies on national healthcare initiatives, such as its
collaboration with Merck Sharp & Dohme (MSD) and NHS
England, with the ambition of eliminating Hepatitis-C by 2030.

• Meaningful contribution to Covid-19-related ground-breaking
research programmes, including the national OpenSAFELY
programme.

• EMIS Group’s long-running co-created QResearch programme,
one of the largest and richest general practice databases in
the world, continues to be a cornerstone of many influential
research papers.

Improving patient outcomes

• Seamless co-ordination of care processes through integration.

• Proactive identification of patients for healthcare or lifestyle

• Enabling new processes and better care pathways through

interoperable clinical systems.

intervention using data analytics technology.

• Identify areas of care needs locally or nationally, enable planning

and delivery of services to meet those needs.

KEY TO STRATEGIC PRIORITIES

Sustainable financial growth

2 Technology innovation

3 User, customer and partner experience

4 ESG

EMIS Group plc | Annual report and accounts 2021

Strategy

The next stage
of the Group’s
evolution

EMIS continues to deliver its strategy of growth
through innovation, modernisation and acquisition
of relevant technologies that benefit its customers.
The Group is committed to growing the overall
business both organically and inorganically while
increasing efficiency of operations and improving
customer experience.

Organic growth
Focussing on quality and innovation in EMIS’s current and evolving product
portfolio will drive organic growth in existing EMIS Health markets. Innovation
will drive growth into new markets in EMIS Enterprise, including research and life
sciences.

Elite partnerships
EMIS’s partnerships continue to go from strength to strength, contributing positively
to the overall Group ecosystem. EMIS forms elite partnerships to enhance its overall
capability, to bring solutions to market more quickly.

Targeted M&A
EMIS’s 2020 acquisition of Pinnacle demonstrates how small targeted businesses
can seamlessly merge into the Group and quickly start making a positive
contribution to both revenue and strategy. The Group continues to evaluate
targeted M&A opportunities that can add new capabilities such as the January
2022 acquisition of Edenbridge Healthcare and March 2022 acquisition of
FourteenFish.

Market drivers will help achieve the strategy
The key macro market drivers of the NHS’s integrated care strategy and the greater
role that data and analytics will play in the market underpin the Group’s four pillars
of strategy. These are outlined on pages 18 to 19.

Risk management page 32

Key performance indicators page 20

EMIS Group plc | Annual report and accounts 2021

SUSTAINABLE
FINANCIAL GROWTH

The Group is focussed on growth through
technology innovation, positive customer
experience and close customer relationships.

Growth will enable EMIS’s vision to
be the leading provider of innovative
technology that improves people’s lives.
All stakeholders will benefit from EMIS’s
growth, bringing the Group closer to its
long-term goal of 30% margin, considering
investor priorities. Growth into new
markets means customers benefit from
better integrated healthcare systems.
Employees will benefit from employment
opportunities and career progression.

Key achievements
• Results above expectations for 2021.

• Higher proportion of non-hardware
revenues than 2020 in EMIS Health.

• Double-digit growth in the areas of

patient-facing services, analytics and
pharmacy in EMIS Enterprise.

Future priorities
• Continue to build good momentum
for future growth in existing and
new markets.

• Continue the technology investment

programme to accelerate growth, whilst
controlling costs and optimising spend.

• Consideration of bolt-on acquisitions to
expand capabilities in growing markets.

Links to KPIs and risks
• Every KPI monitors the Group’s
progress towards its overall
growth strategy.

• The mitigation of every adverse risk
enables the Group’s growth strategy.

Links to market drivers
The emergence of ICSs and their
requirement for integrated care, and the
government’s drive towards digitally-
enabled research, are key market drivers
that can help EMIS achieve its growth
strategy in both the NHS and data and
life sciences markets.

STRATEGIC REPORT2

TECHNOLOGY
INNOVATION

EMIS’s technology innovation strategy
centres on accelerating digitisation of the
NHS to support better patient outcomes.

The efficiency of every transaction in
healthcare relies on technology, and
customers’ needs are considered in every
software release large or small – from
national customers such as NHS Digital to
end user clinicians. The UK public benefits
directly from EMIS’s digital front door
services and indirectly from better health
outcomes from an efficient and informed
digitised healthcare service.

USER, CUSTOMER
AND PARTNER
EXPERIENCE

EMIS’s strategy is to help customers do
what they do best: support patient care
at every level, from clinicians through to
researchers. With a focus on high quality
service, products and delivery, EMIS’s
culture is to consider its customers in
every decision. For investors this focus
leads to business retention and growth.
Users, customers and partners will have
the best possible experience with EMIS
products and services, leading to a greater
sense of job satisfaction and corporate
pride for employees.

ESG

EMIS’s business goals are underpinned by
strong ESG principles. During 2021 EMIS
formalised its existing commitment to
governance and employee wellbeing into
a full ESG strategy, adding environmental
targets. The Group’s materiality
assessment ensured all stakeholders’
views were considered when setting its
ESG priorities and goals, ranging from
preparing for the Task Force on Climate-
related Financial Disclosures (TCFD) to
diversity and inclusion.

Key achievements
• New innovations released into existing

Key achievements
• Positive improvement in system

Key achievements
• Created an ESG committee to oversee

clinical systems across all markets.

performance and customer satisfaction.

the Group’s strategy.

• Completion of the first phase of EMIS-X

• Continual release of system

technology refresh.

enhancements throughout 2021.

• Materiality assessment determined the
issues most important to stakeholders.

• Advancements in integration

• Close collaboration with ICSs on their

• Set targets based on the priorities

technology powered by EMIS-X,
linking GPs, community pharmacies
and patients.

locality-wide technology transformation
plans to deliver the customer
requirements of the future.

identified.

Future priorities
• Continue investment in technology,
particularly focussed on data and
analytics and interoperability.

• Deliver cloud-ready, higher quality

software at a faster pace.

• Optimise efficiency with industry-
leading technology development
processes such as SAFe.

Future priorities
• Continue proactive comms to further

improve customer engagement.

• Continue to drive quality into the

current product portfolio.

• Developing innovative technology to
meet future customer priorities, such
as advanced interoperability capabilities.

Future priorities
• Become carbon neutral by 2030.

• Be regarded as an employer of choice

with a top talent culture.

• Achieve at least 33% female

representation on the Group Board
by the end of 2023.

Links to KPIs and risks
• Measurement of R&D investment will
ensure the continued momentum of
technology transformation.

Links to KPIs and risks
• Customer satisfaction leading to
retention and wins will drive all
financial KPIs.

• Mitigation of risks in technology and
software development, people and
culture and clinical safety will enable
the success of the technology strategy.

• Mitigations relating to healthcare

structure and procurement changes
ensure that EMIS will stay ahead of
all current and future customer needs.

Links to market drivers
Integrated healthcare together with
data and analytics are widely regarded
as key to relieve pressure on front line
healthcare, especially as the industry
moves beyond Covid-19. EMIS’s strategy
is in line with market need at a time when
technology is more vital than ever before.

Links to market drivers
Delivering an excellent, symbiotic user
experience leads to successful use of
technology. EMIS’s strong focus in this
area against the backdrop of the NHS
modernisation programme means the
Group is well placed to continue its
leading positions in all markets.

Links to KPIs and risks
• Achieving balance between the
corporate strategy and the ESG
strategy will ensure business success,
driving both financial and non-
financial KPIs.

• The Group’s ethical principles defined

in its ESG strategy and business
values underpin mitigations against
all identified risks.

Links to market drivers
EMIS’s ethical business principles create
a culture where doing the right thing is
at the heart of activity. Consideration
is given at every level to how a happy,
responsible, sustainable business can best
serve the NHS, keeping EMIS inherently
in alignment with market need.

EMIS Group plc | Annual report and accounts 2021

Key performance indicators

Measuring our performance

The Group’s key performance indicators (KPIs) monitor
progress towards the achievement of its objectives.

Total revenue2

Adjusted operating profit1,2

£168.2m +6%-

£43.5m +11%-

Adjusted earnings
per share (EPS)1,2

56.1p +10%

2021

2020

2019

2018

2017

168.2

159.5

149.7

170.1

142.4

160.4

2021

2020

2019

2018

2017

43.5

39.3

35.9

37.6

36.8 37.4

2021

2020

2019

2018

2017

56.1

51.0

51.4

45.1

47.4

46.4

47.2

DESCRIPTION
Total revenue is a reflection of the level
of business that customers choose to
place with the Group. It is important as
a measure of the attractiveness of the
Group’s products to the market.

Financial review pages 24 to 27

STRATEGIC FOCUS
Total revenue increased by 6% on the
previous year. This is a sign of continued
customer confidence in the Group’s
products and improved momentum in
line with expectations during a more
normalised trading period.

DESCRIPTION
This is the key measure of the Group’s
underlying financial profitability, as
defined in the alternative performance
measures (APM) section on page
22, excluding exceptional items and
expensing development costs as incurred.

DESCRIPTION
Adjusted EPS represents the best
measure of underlying profit attributable
to shareholders, as set out in the APM
section on page 22.

STRATEGIC FOCUS
Adjusted operating profit increased by
11% on the previous year, reflective of a
combination of increased recurring and
non-recurring revenue growth and a
more normalised gross margin sales mix
partly offset by higher staff costs and
operating expenses. The Group’s target
continues to be increasing operating
margins towards 30%, which implies a
faster rate of growth in profit than in
revenue, to be delivered by operational
leverage and greater efficiency in the
Group’s systems.

STRATEGIC FOCUS
The 10% increase in adjusted EPS in the
year was broadly consistent with the
adjusted operating profit, which was
11% higher than the previous period. As
a key measure of shareholder return and
driver of Executive long-term incentive
plans, EMIS Group’s strategy is to focus
on driving improvements in this metric
in future through delivering sustainable
business growth.

LINK TO STRATEGIC PRIORITIES

LINK TO REMUNERATION
LINK TO REMUNERATION

LINK TO REMUNERATION

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORTKEY TO STRATEGIC PRIORITIES

KEY TO REMUNERATION

Sustainable financial growth

2 Technology innovation

3 User, customer and partner experience

4 ESG

R Link to remuneration

R No link to remuneration

Total dividend
for the year

35.2p +10%

Employee engagement

R&D investment2

87% +7%

£21.3m +1%

2021

2020

2019

2018

2017

35.2

32.0

31.2

28.4

25.8

2021

2020

2019

2018

2017

2021

2020

2019

2018

2017

21.3

21.2

20.7

18.7

19.0

16.8

17.1

DESCRIPTION
This measure records the amount of
dividend paid out per share relating
to the financial year.

STRATEGIC FOCUS
The Board’s recommendation of a 10%
increase in dividend is a reflection of
the Board’s commitment through the
capital allocation policy (see page 82) to
increase direct returns to shareholders
over time in line with underlying
earnings growth.

DESCRIPTION
The engagement score is the Group-
wide weighted average response to the
following statements, measured regularly
throughout 2021: “As part of a mainly
remote workforce, I feel engaged with the
business and my colleagues” and “I have
regular meetings with my manager, which
include a good two-way dialogue”.

STRATEGIC FOCUS
EMIS will enhance its employee
engagement measurement during 2022
with a new survey platform. This will
provide an effective, flexible and efficient
Group-wide method to capture and
analyse employee feedback, as well as
enable external benchmarking. This is an
important step towards EMIS’s ambition
to become an employer of choice.

DESCRIPTION
This measures the level of R&D
investment in the Group’s software
products and is a key measure of the
Group’s commitment to ensuring that it
not only maintains its existing portfolio
but is also investing in developing the
products of the future.

STRATEGIC FOCUS
The flat position in the year is reflective
of the Group’s strategic focus on
preparing new products for the evolving
healthcare market, including Patient
and the EMIS-X clinical and analytics
platform, as well as enhancing existing
products such as EMIS Web.

LINK TO STRATEGIC PRIORITIES

LINK TO REMUNERATION

1 Adjusted operating profit and adjusted EPS are APMs. See page 22 for further details.

Continuing operations excluding Specialist & Care business.

Continuing operations and discontinued Specialist & Care business.

EMIS Group plc | Annual report and accounts 2021

Alternative performance measures (APMs)

This report contains certain financial measures (APMs) that are not
defined or recognised under IFRS but are presented to provide readers
with additional financial information that is evaluated by management
and investors in assessing the performance of the Group.

This additional information presented is not uniformly defined by all
companies and may not be comparable with similarly titled measures and
disclosures by other companies. These measures are unaudited and should
not be viewed in isolation or as an alternative to those measures that are
derived in accordance with IFRS.

Recurring revenue
Recurring revenue is the revenue that annually repeats either under
contractual arrangement or by predictable customer habit. It highlights
how much of the Group’s total revenue is secured and anticipated to
repeat in future periods, providing a measure of the financial strength of
the Group. It is a measure that is well understood by the Group’s investor
and analyst community and is used for internal performance reporting.

Reported revenue
Non-recurring revenue

Recurring revenue

2021
£’000

2020
£’000

168,226
(33,417)

159,453
(29,410)

134,809

130,043

Adjusted operating profit, adjusted operating margin
and adjusted earnings per share
Adjusted operating profit is operating profit from continuing
operations excluding exceptional items, the effect of capitalisation and
amortisation of development costs, and the amortisation of acquired
intangible assets. The same adjustments are also made in determining
the adjusted operating margin of the Group and its segments and also
in determining adjusted EPS. The EPS calculation further adjusts for the
related tax and non-controlling interest effects of the operating profit
adjustments.

The Board considers this adjusted measure of operating profit to
provide the best metric of assessing underlying performance, as:

• it excludes exceptional items (items are only classified as exceptional

due to their nature or size);

• it excludes any one-off goodwill impairment;

• by expensing capitalised development costs (and also excluding the
impact of the amortisation of these costs) it reflects the underlying
in-year cash cost of development of software for external sale, as
development is considered to be a core ongoing operating function of
the business; and

• it excludes the amortisation of acquired intangibles arising from
business combinations which varies year on year dependent on
the timing and size of any acquisitions. This is consistent with the
treatment of the amortisation of the Group’s software developed for
external sale.

These metrics are used internally for reporting business unit performance
and in determining management and executive remuneration. They
are commonly used by other software companies and are also well
understood by the Group’s investor and analyst community.

Reported operating profit
Development costs capitalised
Amortisation of computer software developed
for external sale
Amortisation of intangible assets arising on
business combinations
Exceptional release of contingent acquisition
consideration

Adjusted operating profit

2021
£’000

35,785
(4,052)

2020
£’000

35,776
(6,590)

6,127

4,276

5,673

6,824

—

(1,020)

43,533

39,266

A reconciliation of adjusted earnings used in the adjusted EPS
calculations is shown below:

Profit attributable to equity holders
Development costs capitalised
Amortisation of computer software
developed for external sale
Amortisation of intangible assets arising
on business combinations
Exceptional release of contingent
acquisition consideration
Other income
Tax and non-controlling interest effect
of above items

2021
£’000

29,076
(4,052)

2020
£’000

30,248
(6,590)

6,127

4,276

5,673

6,824

—
—

(1,020)
(782)

(1,472)

(925)

Adjusted profit attributable to equity holders

35,352

32,031

Adjusted cash generated from operations
The Group’s adjusted cash generated from operations adjusts for
development costs capitalised and the cash costs of exceptional items,
consistent with the adjusted operating profit metric used by the Group.
This provides a meaningful metric for the underlying cash the Group
generates having accounted for the cash cost of all development
expenditure and adding back the cash cost of non-recurring
exceptional items.

Reported cash generated from operations
Development costs capitalised
Cash cost of exceptional items

2021
£’000

50,059
(4,052)
—

Adjusted cash generated from operations

46,007

2020
£’000

64,138
(6,590)
1,303

58,851

Net cash/(debt)
The Group uses net cash/(debt), defined as cash and cash equivalents less
total borrowings (excluding IFRS 16 lease liabilities), as a supplementary
measure in evaluating its liquidity, as it indicates the level of cash available
to the Group and provides an indicator of the overall balance sheet
strength. It is used in the calculation of the leverage ratio under its bank
facility arrangements. For the year ending 31 December 2021 the Group
was in a net cash position, with no borrowings.

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORT
Case study

Frimley ICS: using population health analytics to
transform primary care delivery

Frimley Health and Care ICS – responsible for 800,000 patients in
the South of England – is using EMIS-X Analytics to gain a deeper
understanding of the health needs of the communities it serves and
transform primary care delivery.

A powerful tool
Frimley ICS is one of the first NHS organisations to use EMIS-X
Analytics. Mark Sellman says it is “the most advanced primary care
analytics capability we have seen”.

Chief Information Officer, Mark Sellman, says it’s part of a strategy to
help overstretched GP practices. Using EMIS-X Analytics, the ICS has
identified a 17% annual rise in primary care demand. The data has also
highlighted a trend among patients identified as generally well who are
bypassing primary care and going directly to emergency departments.
These insights have been provided directly to each primary care
network to inform a local-level response.

Deeper understanding of pressure in primary care
Frimley ICS has been able to integrate the advanced capabilities of
EMIS-X Analytics with its local shared care record and population health
tools to better understand the pressure of rising primary care demand.

Alex Barnett, Head of Analytics for Frimley ICS said: “EMIS-X
Analytics is opening a world of possibilities for our population health
management programme – we are using this data to quantify how
demand has changed over the course of the pandemic. We can take
important strategic insights into the population and deploy them back
to our front line clinicians as part of the patient record.”

He said: “The opportunities with EMIS-X Analytics are enormous. Next,
we’re going to analyse what is causing the generally well, who should
initially be treated within a primary care setting, to seek help from urgent
care and what interventions we can put into place. We want to keep
working at pace with EMIS to continue changing primary care delivery.”

Alex Barnett adds: “EMIS-X Analytics is going to be an essential pillar
of our analytics strategy for years to come. It is a game changer in
enabling systems to better understand primary care.”

Frimley Health and Care ICS is a partnership of organisations working
together to improve health and care services for people in Ascot,
Bracknell, Farnham, Maidenhead, North East Hampshire, Slough,
Surrey Heath and Windsor.

Visit our website to read more:
https://www.emisgroupplc.com/

17%

800,000

annual rise in primary
care demand identified
by EMIS-X Analytics

patients cared for
across Frimley Health
and Care ICS

EMIS Group plc | Annual report and accounts 2021Financial review

Performance
above
expectations

The results for the year ended 31 December 2021 reflect improved
momentum with increases in the Group’s revenue, recurring revenue,
adjusted operating profit and adjusted operating margin. Reported
operating profit was unchanged with reported operating margin
therefore slightly lower and, as expected, cash flow was less strong
than the comparative period as Covid-19-related VAT deferrals
unwound and investment in the business to deliver future growth
was maintained.

Group revenue increased by 6% to £168.2m (2020: £159.5m) and
included revenue of £7.4m (2020: £2.2m) from the March 2020
Pinnacle acquisition. Recurring revenue grew by 4% to £134.8m (2020:
£130.0m), representing 80% (2020: 82%) of the Group’s total revenue.

Adjusted operating profit for the year, as set out in the table opposite,
grew by 11% to £43.5m (2020: £39.3m), with increases in both
recurring and non-recurring revenue and a more normalised gross
margin sales mix, partly offset by higher staff costs and increased
operating expenses. Reported operating profit was £35.8m (2020:
£35.8m). A reconciliation between the operating profit measures is
given in the Group statement of comprehensive income and in the
APMs section on page 22.

In EMIS Health, revenue reflected a more normalised trading period
for the segment with the comparative period having included higher
than usual hardware sales. Overall revenue was marginally higher
at £107.9m (2020: £107.8m) with the higher quality revenue mix
resulting in an adjusted operating profit increase of 5% at £26.3m
(2020: £25.1m), delivered while continuing to invest in developing the
strategic roadmap. Reported divisional operating profit was 7% lower
at £22.1m (2020: £23.8m) due to a reduction in the level of capitalised
development costs and an increase in related amortisation.

In EMIS Enterprise, revenue increased by 17% to £60.3m (2020:
£51.7m) and recurring revenue increased by 8%, reflecting an improved
market and a relatively weak comparative period which was more
affected by Covid-19 lockdowns. With the segment continuing to
focus on executing in the areas of patient-facing services, analytics
and pharmacy, including supporting the NHS Covid-19 vaccination

programme through its Pinnacle software, adjusted operating profit
increased by 21% to £18.9m (2020: £15.7m) and reported operating
profit also increased to £15.4m (2020: £13.5m).

Revenue
The analysis of revenue is summarised below with full segmental
revenue analysis set out in note 5:

• software subscription and support revenue increased to £104.5m

(2020: £99.5m), reflecting the impact of the Pinnacle acquisition and
higher revenues from the Group’s existing customers;

• interface and connectivity charges increased to £24.4m (2020:
£20.3m) as a result of increased on-boarding within the partner
programme;

• other services revenue was higher at £16.3m (2020: £13.4m) with

increased digitisation project work and growth in analytics;

• hardware and related services reduced to £10.7m (2020: £17.3m)
due to a more normal level of demand after a spike caused by the
early months of the pandemic in the comparative period; and

• perpetual licences, training, consultancy and implementation

revenue was higher at £12.4m (2020: £9.0m) with an increasing level
of project work across the business including one-off revenues in
relation to the NHS Covid-19 vaccination programme.

The high level of recurring revenue and the strength of the Group’s
customer relationships give the business confidence to invest in
developing future products and services, while providing good visibility
of future financial performance.

Profitability
Adjusted operating profit increased by 11% on the comparative
period at £43.5m (2020: £39.3m) with the adjusted operating margin
increasing to 25.9% (2020: 24.6%).

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORTREVENUE ANALYSIS

6262+

charges: 15%

and support: 62%

Software subscriptions

Interface and connectivity

C 8080+

training, consultancy
and implementation: 7%

Hardware and related

Perpetual licences,

Other services: 10%

services: 6%

Recurring: 80%

Non-recurring: 20%

Total staff costs (including capitalised development costs) were 9%
higher than in 2020, reflecting higher package and reward levels for an
increasingly skilled and in-demand workforce. Year-end staff numbers
decreased to 1,429 (2020: 1,591) and the average headcount was lower
at 1,508 (2020: 1,579), owing to a combination of attrition, principally in
India, changes in skills required and planned operational efficiency.

Other operating expenses increased with additional costs associated
with the technology transformation programme, including
Microsoft and AWS.

While adjusted operating profit moved ahead, reported operating profit
was unchanged at £35.8m (2020: £35.8m), reflecting a lower level
of capitalisation of development costs with teams focussing more on
improving customer experience, a slightly higher level of amortisation
and a one-time acquisition accounting related credit in the prior year.
Profit before tax was lower at £36.1m (2020: £36.9m) with the prior
year including a one off £0.8m business disposal credit.

EPS
As there was no change in the Company’s issued share capital during
the year, EPS movements were driven largely by changes in adjusted
and reported profit. Adjusted basic and diluted EPS were 10% higher at
56.1p and 55.5p respectively (2020: 51.0p and 50.4p). The statutory
basic and diluted EPS were both lower at 46.2p and 45.6p respectively
(2020: 48.1p and 47.6p).

Dividend
Subject to shareholder approval at the AGM on 5 May 2022, the Board
proposes an increase in the final dividend to 17.6p (2020: 16.0p) per
ordinary share, payable on 17 May 2022 to shareholders on the register
at the close of business on 19 April 2022. This would make a total
dividend of 35.2p (2020: 32.0p) per ordinary share for 2021. This is
10% higher than in the prior year, reflecting the underlying growth of
the Group and its positive future prospects.

Taxation
The tax charge for the year was £7.0m (2020: £6.8m) including £0.3m
resulting from the recalculation of deferred tax at the increased future
rate of 25%. The effective tax rate for the year before the deferred
tax rate change, release of contingent acquisition consideration, other
income and share of result of joint venture and associate was 19.1%
(2020: 19.1%).

Segmental performance
This table sets out the summary segmental performance:

Revenue

Adjusted segmental operating profit

Group expenses

Adjusted operating profit1

Adjusted operating margin

Reported segmental operating profit

Group expenses

Reported operating profit

Reported operating margin

EMIS Health
2021
£’m

EMIS Health EMIS Enterprise
2021
£’m

2020
£’m

EMIS Enterprise
2020
£’m

107.9

26.3

107.8

25.1

60.3

18.9

51.7

15.7

24.4%

22.1

23.3%

23.8

31.4%

15.4

30.4%

13.5

Total
2021
£’m

168.2

45.2

(1.7)

43.5

Total
2020
£’m

159.5

40.8

(1.5)

39.3

25.9%

24.6%

37.5

(1.7)

35.8

37.3

(1.5)

35.8

20.4%

22.1%

25.6%

26.1%

21.3%

22.4%

1 Excludes capitalisation and amortisation of development costs, amortisation of acquired intangibles and exceptional items.

EMIS Group plc | Annual report and accounts 2021

+
15
15
+
+
10
10
+
+
7
7
+
+
6
6
+
+
C
20
+
20
+
+
C
C
Financial review continued

Cash flow and net cash
The principal movements in net cash (rounded) were as follows:

Cash from operations:
Cash generated from operations

Less: capitalised development costs

Adjusted cash generated from operations
Cash cost of exceptional items

Net cash generated from operations
Business combinations

Business disposal

Capital expenditure

Disposal of property assets

Transactions in own shares

Tax
Dividends
Lease payments
Finance/other

Change in net cash in the year

Net cash at end of year

2021
£’m

50.1

(4.1)

46.0
—

46.0
(2.0)

—

(2.3)

—

(1.5)

(7.5)
(21.1)
(1.2)
0.6

11.0

64.0

2020
£’m

64.1

(6.6)

58.8
(1.3)

57.5
(4.2)

0.8

(2.9)

2.5

0.5

(11.7)
(19.9)
(1.5)
0.8

21.9

53.0

Cash generated from operations decreased to £50.1m (2020: £64.1m)
with the decrease due principally to working capital movements. In
particular, this reflected the repayment of £7.3m of VAT, the deferral
of which had benefitted the comparative period by £7.3m. Adjusted
cash from operations is stated after deducting capitalised development
costs and adjusting for the cash impact of any exceptional items where
appropriate. On this adjusted basis, cash flow from operations was
22% lower than in 2020 at £46.0m (2020: £58.9m).

Capital expenditure on property, plant and equipment and purchased
software excluding capitalised development costs remained tightly
controlled at £2.3m (2020: £2.9m). Capital additions in the year
included £1.7m on computer equipment and £0.5m on property assets.

The Group paid £2.0m of deferred consideration in respect of the 2020
acquisition of the Pinnacle business and £2.4m to acquire shares to
satisfy future requirements of employee share schemes, partially offset
by £0.9m received for shares transferred to employees.

After transactions in own shares, tax, dividends, lease payments and
finance/other transactions, the total net cash inflow of £11.0m resulted
in a year-end net cash position of £64.0m (2020: £53.0m).

As at 31 December 2021, the Group had available undrawn bank
facilities of £30.0m in place until 17 December 2024. An accordion
arrangement is in place to increase the bank facilities up to £60.0m if
required, providing total liquidity of up to £124.0m at the year-end.

Peter Southby
Chief Financial Officer
24 March 2022

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORTTotal revenue3

Recurring revenue2,3

Reported operating profit3

£168.2m +6%-

£134.8m +4%

£35.8m –

2021

2020

2019

2018

2017

168.2

159.5

149.7

170.1

142.4

160.4

2021

2020

2019

2018

2017

134.8

130.0

125.0

120.6

140.7

115.8

133.5

2021

2020

2019

2018

2017

35.8

26.8

27.7

28.7

10.6 10.9

Adjusted operating profit1,2,3

Reported operating margin3

Adjusted operating margin1,2,3

£43.5m +11%-

21.3% -116bps

25.9% +125bps

2021

2020

2019

2018

2017

43.5

39.3

35.9

37.6

36.8 37.4

2021

2020

2019

2018

2017

21.3

22.4

16.8

16.9

18.5

6.6

7.7

2021

2020

2019

2018

2017

25.9

24.6

22.1

24.0

23.3

25.8

Reported cash generated
from operations

£50.1m -22%

Adjusted cash generated
from operations2

£46.0m -22%

2021

2020

2019

2018

2017

64.1

50.1

49.9

48.8

2021

2020

2019

2018

2017

46.0

46.3

58.9

54.5

49.7

Reported earnings per share3

46.2p -4%

2021

2020

2019

2018

2017

12.8 13.2

46.2

48.1

36.0

34.7

36.1

Adjusted earnings
per share1,2,3

56.1p +10%

Total dividend for the year

35.2p +10%

2021

2020

2019

2018

2017

56.1

51.0

51.4

45.1

47.4

46.4

47.2

2021

2020

2019

2018

2017

35.2

32.0

31.2

28.4

25.8

1 Excludes capitalisation and amortisation of development costs, amortisation of acquired intangibles and exceptional items as set out in the Group statement

of comprehensive income on page 93. Earnings per share calculations also adjust for the related tax and non-controlling interest impact.

2 These are alternative performance measures. See page 22 for further details and reconciliation to the relevant IFRS number.

Continuing operations excluding Specialist & Care business.

Continuing operations and discontinued Specialist & Care business.

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORT

Operational review

Focussed on integrated care

Enabling integrated healthcare in alignment with NHS strategy.

EMIS HEALTH
The EMIS Health segment comprises business areas where revenues
are generated from delivering core software and ancillary services to
NHS organisations. This includes the primary, community and acute
A&E markets.

Market shares
EMIS improved its UK GP market leadership position with a market
share of 58% (2020: 57%). The Group holds a joint market leadership
position in Acute A&E at 21% (2020: 21%) and the number two market
position in community at 20% (2020: 20%).

Supporting primary care
The Group remains well placed for the framework mini-tender
processes that are anticipated to occur through the coming years
across England, Scotland, Wales and Northern Ireland.

England
EMIS continues to deliver against the GP IT Futures framework in
England, from forward-thinking interoperability projects to a significant
number of unplanned and essential projects implemented to support
NHS Digital with Covid-19 initiatives.

As previously confirmed the framework renewal, next due at the end of
March 2023, is now being conducted on a financial viability status basis
only. Given the financial strength of the Group, this is expected to be
a formality.

The detailed terms and conditions for primary systems and services
are managed through the “evergreen” GP IT Futures catalogue. It
is anticipated that current arrangements in England are likely to be
extended for 18 months from 1 October 2022 because of the impact of
the pandemic.

Scotland, Wales and Northern Ireland
EMIS continues to work with NHS National Services Scotland (NSS)
on the GP IT Reprovisioning Framework, closely aligning technology
developments with market need and forming deployment plans.

During 2021 EMIS Health secured its position on the Digital Health and
Care Wales (DHCW) primary care framework to supply GP IT systems
and services, providing growth opportunities in this market.

In Northern Ireland, EMIS extended the current primary care contract
until 2023. The business continues to work with GP practices and
central organisations to support efficiency in working processes
through technology and help meet their healthcare objectives.

Enabling integrated healthcare
Integrating care settings through technology is one of EMIS’s strengths,
with its broad reach across the key healthcare markets, strong market
shares and technology built with interoperability at the core. EMIS-X
is continuing a long history of the business being at the forefront of
interoperability innovation.

During 2021 the Group released a number of products that integrate
EMIS systems across different sectors (for example GPs and community
pharmacies) and support NHS clinicians to offer a better service to
patients, increase efficiency and improve working processes. This
supports ICS strategies to join up care. The software released included:

• GP community pharmacist consultation service – enabling non-

clinical practice staff to refer patients with minor illnesses to their
local community pharmacy via seamless interoperability between
EMIS Web and ProScript Connect, powered by EMIS-X technology.

• NHS Digital’s transfer of care initiative – GP practices can now

receive electronic discharges and outpatient letters from hospitals
straight into EMIS Web through the national fast healthcare
interoperability resources (FHIR) interoperability standard.

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORT• Symphony 3.1 A&E system – powering NHS urgent care

networks to enable electronic handover between 111 and
emergency departments.

• Smart Pharmacy – the extended pilot of the new service was

launched during 2021 to positive feedback. Integration between
ProScript Connect, Patient Access and EMIS Web enables
patients to order repeat medication online and track progress
from order to home delivery.

• PharmOutcomes – enabling community pharmacists to exchange

national interoperability FHIR and HL7 standard messages,
such as receiving hospital discharge information and NHS 111
referrals or informing GPs that they have undertaken a flu or
Covid-19 vaccination.

Improving customer experience
EMIS Health’s strategy of excellence in customer satisfaction is a
key driver for business growth in the segment. Everything in the
product development roadmap is designed to drive even more
quality into the existing product portfolio, to ensure customer
experience continues to improve.

During 2021 EMIS released a number of enhancements to increase
customer satisfaction, including ways to speed up everyday
processes in the system to drive efficiency. Accelerations in the
software release process mean that essential updates are delivered
to customers much more quickly. New updates to the EMIS Now
online support portal have made reporting issues even easier and an
improved communication process means that customers are kept up
to date on any known issues, upcoming enhancements and software
releases, improving customer engagement and satisfaction.

Gold standard learning
EMIS was accredited as a continued professional development
(CPD) learning provider during the year, supporting the launch
of the EMIS Academy platform. This new system provides online
access to the library of EMIS training content to help users
make the most of EMIS systems. The learning team achieved
gold standard accreditation from the Learning and Performance
Institute (LPI) for the second year running as a mark of quality for
the standard of EMIS’s education content.

The March 2022 acquisition of FourteenFish further strengthens
EMIS’s education proposition.

13mentries are made to patient

clinical records every day

Industry insight

Redesigning primary
care
Dr Edward Clode-Baker
Clinical Director, EMIS Group

The pandemic was a catalyst to reshape traditional delivery
methods in general practice.

Despite the best efforts of the NHS, there were inevitably
health concerns during the pandemic that weren’t addressed.
Patients are now seeking support and primary care is facing a
huge challenge with the total volume of work: the traditional
GP model is having to adapt.

The scale of the challenge is great, but so are the tools at
our disposal. Technology is playing a crucial role in enabling
practices to give patients access to the most appropriate
services, including self-care and referral to specialist
services.

Many practices have introduced online consulting tools to
help with patient triage. This means clinical resource is being
used to the best effect.

Multi-disciplinary clinicians are delivering more patient
care, reducing reliance on GPs. Nurse practitioners are
carrying out minor illness and minor injury consultations.
Physiotherapists may work from GP practices and see
patients within the primary care environment. Social
prescribers may connect patients for support with services
and resources other than traditional healthcare.

Receptionists can help direct patients to alternative routes of
care so they receive help faster: many are now called “patient
coordinators” which reflects this changing role.

Going forward, clinicians will be working more closely
together and sharing critical patient data digitally will be
vital to the success of collaborative working.

EMIS Group plc | Annual report and accounts 2021STRATEGIC REPORT

Operational review continued

Opportunity for growth

New services launched for community pharmacists,
patients and in the data and analytics space.

EMIS ENTERPRISE
The EMIS Enterprise segment comprises business areas where
revenues are derived predominantly from B2B healthcare sector
sources, including medicines management across both community and
hospital pharmacy, the Patient business and the analytics, research and
life sciences sector.

• Golden Tote – an automated repeat prescription process based on
a hub and spoke model, provided for Numark, a division of Phoenix
Healthcare Distribution.

• Integration between ProScript Connect and the Pinnacle and

Patient suite of products remains at the forefront of the community
pharmacy strategy to provide further integrated care solutions.

Market shares
The Group improved its market-leading position in community
pharmacy during 2021 to 39% (2020: 38%) and maintained its number
two market position in hospital pharmacy with a market share of 35%
(2020: 36%).

Adding value for community pharmacy customers
The 2019 NHS Long Term Plan outlined the intention for community
pharmacies to expand beyond their traditional dispensary function
and provide a greater range of clinical services to their customers,
to alleviate pressure on primary care. The pandemic has accelerated
this requirement, from the dual pressures of providing Covid-19
vaccinations and increased demand for other services, such as
seasonal flu vaccinations or minor ailments. As this adaptation gathers
momentum, ProScript Connect was successfully transitioned into the
cloud to allow for even greater interoperability in future.

The community pharmacy market is a competitive environment, and
EMIS is focussed on providing innovative new developments to help
customers fulfil their changing role, leading to retention and growth in
this sector. Added value services released during 2021 include:

• Pro Delivery Manager – management of home delivery services.

• Centred Solutions – a third party dispensing workflow solution.

• PharmaSelf 24 – an automated prescription-collection system

allowing patients to pick up medicine 24/7.

EMIS Group plc | Annual report and accounts 2021

Actionable data insight through EMIS-X Analytics
EMIS-X Analytics offers significant potential for EMIS Group to grow
the business over time with opportunities in both the NHS and life
sciences sectors.

EMIS is engaged with some of the largest research and life sciences
companies in the world, including Pfizer and Bristol Myers Squibb, to
explore how the business can enable and accelerate research with EMIS-X
technology. The positive feedback so far from pilot projects has enabled
EMIS to build a strong proposition as it moves further into the research
and life sciences market during 2022. 27 customers now use EMIS-X
Analytics, twelve of which are in EMIS Enterprise, including research and
life sciences, and 15 are in EMIS Health (2020: 25 pilot customers).

The addition of Edenbridge Healthcare software and expertise has
further strengthened the analytics proposition. The Edenbridge team
brings specialist knowledge in applying analytics insight to make
meaningful change to healthcare processes and patient outcomes
on a locality-wide scale.

Data analytics powered by EMIS-X technology is already being used by
a number of NHS organisations to provide insight on important local
healthcare trends. This includes analysis on emergency department
attendance, peak times and demographic details of patients, to inform
resource planning and targeted patient engagement and education.

STRATEGIC REPORTPatient Access and the digital front door: a better
way to access healthcare
The “digital front door” for patients to access healthcare services
remains vital to NHS policy. EMIS Group’s Patient Access app
enables the UK public to find and book “marketplace-style” NHS
and private-provider healthcare services. During 2021 new
services made available included a range of home testing kits,
such as lab testing and diagnostic services. 51,060 services were
booked through marketplace during 2021.

Patient Access is the UK’s leading independent healthcare app.
During 2021, 14.0 million registered users (2020: 11.7 million),
ordered 22.0 million repeat prescriptions (2020: 23.5 million
– boosted by accelerated demand in the early months of the
pandemic) and booked 1.5 million face-to-face GP appointments
(2020: 2.5 million) and 49,000 community pharmacy consultations
(2020: 41,000). The reduction in face-to-face GP appointments
booked reflects the growth of online triage, telephone
consultations, signposting to self-help where appropriate and the
shift towards minor illness treatment and guidance being delivered
within a community pharmacy setting.

Patient.info continues to be one of the UK’s leading medical
information sites. 96 million unique users viewed 187 million pages
during 2021 (2020: 80 million users, 166 million page views). The high
quality healthcare content provided on Patient.info attracts users to
the site as a pipeline for Patient Access services, as well as driving
advertising revenue. The business will continue to invest in content to
attract more visitors and advertisers to generate more revenue.

Building the partner ecosystem for growth
The partner programme continued to perform well during
2021. The partner programme is a strong contributory factor to
increased customer satisfaction for retention and growth in EMIS
Health as well as a separate revenue stream. Building a powerful
ecosystem of interoperable products offers innovative ways for
end users to improve efficiency and digitise processes.

During 2021 EMIS formed elite partnerships with a number of
partners that offer core solutions that integrate with the existing
EMIS product set. This included a cloud-based telephone system, a
digital consent system for elective surgery and a referrals system,
all of which is third party technology that operates seamlessly
with EMIS Web. As part of an elite partnership, EMIS will co-sell
these products, driving increased revenue through the partner
programme. The focus for 2022 will be to add more partners to
both the overall ecosystem and the elite programme.

27customers now using EMIS-X

Analytics technology

Industry insight

Gathering everyday
health insights
Haidar Samiei
Clinical Director, EMIS Group

I often joke that if I had remote access to my mum’s smart
energy meter, I would be able to check up on her more easily.
Peaks in electricity usage could show me that she’s up and
about and dips would give me an idea that perhaps she isn’t
feeling very well.

But I’m not really joking. For years many of us have been able
to record our step count, monitor our heart rate and track
our calorie intake from mobile device and smart wearables.

Caring for loved ones remotely
There is growing use of technology to help monitor the
health and wellbeing of those we love. Dementia patients
can now be monitored at home through integrated
technology, including monitors which record vital signs such
as blood pressure, weight and hydration. Apple watches can
detect falls and inform next of kin.

Transforming healthcare services
Remote monitoring technology is also transforming the way
we design and deliver healthcare services.

Working in an emergency department I see lots of patients
with complaints of heart issues but their symptoms don’t
always present when I’m examining them. I’ve had occasions
when the patient has reached for their smartphone to show
me they’ve been tracking their heart rate prior to visiting
hospital. This is invaluable insight to both clinician and patient.

The real power of monitoring health markers lies in looking
at this data on a broad scale. For example, if medical grade
wearables were given to patients prescribed a particular
medication, we could analyse trends more easily, such as
side effects, gaining insights and knowledge that can lead to
positive change.

EMIS Group plc | Annual report and accounts 2021Principal risks and uncertainties

Managing risk to achieve
our strategic objectives

Risk management remains a key priority for EMIS Group to sustain the
success of the business in years to come. Each area of the business
identifies, evaluates and manages risk according to the Board policy.

The risk management framework
The Board is responsible for the proactive risk management policy, to
ensure that EMIS Group has an effective framework to manage risk.
Each area of the business has a clear focus to identify, evaluate and
manage risk in line with Group strategic priorities and risk appetite.

The risk management process is overseen by the RMC. The RMC has
formal terms of reference and is chaired by the Chief Financial Officer.
Committee meetings are attended by senior management representing
all areas of the business, supplemented by subject matter experts who
attend on invitation.

The RMC reviews a consolidated Group risk register at least twice
a year before it is submitted to the main Board for consideration.
The audit committee reviews and challenges the principal risks and
mitigating controls identified by management. Group internal audit
provides independent, objective assurance on key risks through a
programme of risk-based audit reviews.

Risks are evaluated using consistent measurements of likelihood,
financial and reputational impact, both before and after mitigating
controls are taken into account. Risk registers and risk scores are
independently verified by the Director of Group Risk and Internal Audit.
A named risk owner is responsible for ensuring that adequate mitigating
controls are in place and operating effectively for individual risks and
that, where a risk exceeds the Group’s risk appetite, there is an action
plan to address this with appropriate timescales. During 2021, internal
audit continued to assess the quality of risk documentation to identify
and implement areas for improvement in identifying, documenting and
mitigating risks where needed.

In addition to the RMC, regular reporting on risks above appetite
is provided for discussion at both GXT and senior leadership
team meetings.

Board of Directors
Ownership and monitoring

Audit committee
Independent review
and challenge

Risk management
committee
Review and input

Group internal audit
Independent, objective
review function

GXT
Operational risk input
Corporate risk review

Divisional and functional
risk registers

EMIS Group plc | Annual report and accounts 2021

Impact of the UK leaving the European Union (Brexit)
The Board is confident that Brexit continues to have minimal direct
effect on the Group as it is not a significant exporter or importer of
goods or services within the European Union. There are potential
indirect effects including exchange rate volatility affecting the value of
sterling, changes in legislation and increased pressure on NHS budgets
that could have a negative impact on the Group’s prospects, but these
are not considered likely to be material. However, it will continue to
keep the market consequences of the terms under which the UK left
the EU under review as those develop in the future.

Principal risks heat map

h
g
H

D
O
O
H
I
L
E
K
I
L

w
o
L

Low

IMPACT

High

The risk heat map above provides a graphical representation
of the principal risks and uncertainties. It shows the
assessment of the relative impact and likelihood of each risk,
along with an indication of the year on year movement of
each risk described in detail on pages 34 to 37.

A Healthcare structure and procurement changes
B Technology and software development
C People and culture
D
E Clinical safety

Information governance and cyber security

STRATEGIC REPORTRisk appetite
The Board, with input from the GXT, has defined its risk
appetite across a range of risk categories as outlined
opposite, accompanied by detailed statements to support
these levels of risk appetite. Although there are areas
where EMIS Group is prepared to take higher levels of
risk, the risk management framework is designed to manage
down to an acceptable level the risk of significant financial or
reputational impact, with rewards being commensurate with
the level of risk being taken within a reasonable timeframe.
These statements provide management with guidance on
how much and what types of risk the Board is prepared to
accept when management is making business decisions.

The Board reviews and revises its risk appetite as its
understanding of the level and nature of risk in the
business develops or as its appetite for taking risk changes.
Acceptable risk appetite levels have remained consistent
throughout 2021.

Risk appetite parameters are built into the Group’s web-
based risk management application. Any area where
exposure is assessed as exceeding the Board’s defined risk
appetite is flagged and assigned to specific members of the
GXT to determine the action required. The RMC monitors
these risks and the corresponding remedial action plans.

Emerging risks
Emerging risks differ from principal risks, or other lesser
risks in the risk management system. They have a higher
degree of uncertainty around when, or even if, they may
occur; therefore their impact cannot readily be assessed.
Emerging risks have the potential to increase in significance
and affect the performance of the Group and its ability
to meet its strategic objectives. Their timeline may be
well beyond the current three-year time horizon applied
to future risks. As their status changes and they become
more certain and more quantifiable, they may move into
the risk registers as clearer, better-defined risks. The RMC
is the main forum for identifying, assessing and reporting
on any significant emerging risks facing the Group. In
addition, a number of horizon scanning and emerging
risk sessions are carried out regularly across the Group
to identify and mitigate any such risks which are deemed
significant. Examples of emerging risks covered during the
year include digital power concentration and disruption by
a major technology organisation, digital inequality, failure
of critical IT infrastructure, infectious diseases and specific
ESG related risks including climate change. In addition, the
Group has reviewed the impact ESG has on its current
principal risks.

The response to Russia’s invasion of Ukraine may have
an impact through increased cyber threats and wider
macro-economic factors. This could include disruptions in
the price and/or supply of energy and other commodities.
EMIS will continue to monitor the situation and take all
necessary precautionary measures.

Ongoing impact of Covid-19
As reported in the 2020 annual report and accounts,
EMIS Group set up an internal operational task force to
respond to Covid-19. The internal operational task force
has continued to review the advice and guidance issued by
the UK and Indian governments and public health bodies.
It responds accordingly to protect the health and safety of
employees and anyone with whom they come into contact.

Risk category

Overall

Strategic

Financial

Compliance (legal, regulatory, health and safety, environmental)

Operational:
– Commercial
– Sales
– Marketing (including product strategy)
– People
– Property
Technical:
– Innovation
– Development
– Release (testing/quality assurance)
– Implementation
– Internal IT systems
Clinical:
– Safety
– Delivery
Data management:
– Information governance (in relation to clinical safety)
– Information security (in relation to data records and

data security)

Risk appetite

Low

Medium

Low

Medium
Medium
Medium
Low
Low

Medium
Low
Low
Low
Low

Low
Low

Low

Each key risk is assigned to an appropriate individual or discrete operating
group and all mitigation and action plans are recorded and monitored.

The impact of Covid-19 continues to drive demand for joined-up technology across
multiple healthcare settings and the need for availability of data. In addition, the
critical nature of the national vaccination programme has required prioritisation
across many areas of the Group.

EMIS has a robust business continuity plan in place and has not experienced any
significant supply chain issues.

The Group has continued to maintain a mainly homeworking approach where
appropriate following regular dialogue with employees. Some of the Group’s
people, such as engineers, are required to visit customers as part of their role and
have continued to do so in a safe and secure manner with appropriate protective
measures put in place. New and adaptions to existing technology have been a
significant and successful enabler for remote working throughout 2021.

The Group has modelled scenarios as part of its going concern and viability
statement assessments which have demonstrated its resilience to a downturn in
trading. The Group will continue to take proactive action to mitigate the ongoing
challenge from Covid-19, both to keep people safe and healthy and to reduce the
impact on all stakeholders.

Principal risks
The principal risks and uncertainties identified by management, and how they are
being managed, are set out on pages 34 to 37. These risks are not intended to be
an extensive analysis of all risks that may arise in the ordinary course of business
or otherwise. The principal risks facing the Group have not materially changed
although a number of additional controls have been put in place during the year.

The principal financial risks are separately disclosed in note 3 to the financial
statements on page 102.

EMIS Group plc | Annual report and accounts 2021

Principal risks and uncertainties continued

DESCRIPTION OF RISK

WHY IS IT A RISK?

HOW WE MITIGATE THE RISK

OPPORTUNITY FOR EMIS GROUP

Healthcare
structure and
procurement
changes

The commercial
success of the Group
is dependent on the
healthcare sector’s
strategic direction to
use IT to reduce costs
and improve efficiency.

There is a risk that the Group’s products and services
are not in line with the sector’s strategies, or that these
will change as healthcare organisations’ plans continue
to evolve.

Examples of this include the transition from Clinical
Commissioning Groups (CCGs) to ICSs and the planned
merging of NHS Digital and NHSX with NHS England
and NHS Improvement.

The NHS represents a significant proportion of the Group’s
revenues; how it is organised and procures goods and
services could affect the Group’s ability to sell effectively
to this market.

There is a risk that new competitors could cause market
disruption through customer adoption of new technologies
and/or changes in competitor business models. This could
include major global technology companies, which may
impact the Group’s market share and financial returns.

The English primary care market remains the
largest single area of revenue for the Group.
There is a risk that the Group may not be
included on future frameworks which govern
procurement in this important area.

WHAT CAUSES THE RISK?
• Failure to achieve interoperability could
have a significant impact on the Group’s
ability to meet the government’s healthcare
technology requirements and to sell its
products and services in the longer term.
• Changes in the way healthcare is delivered,

such as increased remote/tele-health
services, may impact demand for different
solutions.

• Increased competition may affect market

shares or current pricing.

Developing excellent, robust and reliable software systems
is essential to the ongoing success of the business.

The Group’s products may be disrupted by competitors
if they develop more innovative technology.

Failure to implement cloud-based technologies may have
a significant impact in meeting customer demands.

To achieve its objectives, the Group has acquired several
businesses across a range of healthcare sectors. There is
a risk that these businesses do not function effectively as
a group, impacting on the success of product integration
across the sectors.

Technology
and software
development

The Group provides
innovative and
interoperable IT
healthcare systems
that are critical to the
efficient and effective
operation of a wide
range of healthcare
organisations.

People
and culture

The Group is reliant
on the skills and
knowledge of its
people, especially in
software development
and infrastructure,
clinical safety
and information
technology systems.

The risk to the Group is in not being able to recruit or retain
an appropriate calibre of employees.

As a result of Covid-19, the people landscape has altered
significantly with changes in career expectations, demands to
working and aspirations of new market entrants which has led
to an increase in this risk.

The Group’s response to Covid-19 resulted in a permanent
change in working patterns based on a new flexible way of
working, mainly from home. Whilst offices have reopened
as collaboration hubs to support this, there is a risk that the
Group does not optimise this approach, creating short-term
disruption and uncertainty that could lead to the loss of skills
and knowledge.

Failure to integrate acquisitions may result in strategic goals,
synergies and savings not being met.

EMIS Group plc | Annual report and accounts 2021

The technical or physical failure of the
Group’s systems could lead to disruption or
complete service denial of high-profile public
or B2B services.

WHAT CAUSES THE RISK?
• The failure to monitor and rectify

software defects in time could result
in reduced customer satisfaction and
contractual penalties.

• Failure to deliver modern, interoperable

software platforms could have a significant
impact on the Group’s ability to sell
its products and services and upon its
reputation as the leading integrated
healthcare IT supplier to the NHS.

Failure to recruit or retain appropriate
numbers of qualified people in critical areas
could lead to a deterioration in quality of
products and services. This could result in
an inability to meet customers’ needs, loss of
business and the failure to deliver expected
financial returns.

WHAT CAUSES THE RISK?
• Low level engagement caused by a

poor culture could risk the retention of
critical employees and/or a reduction in
productivity and innovation.

• Lack of succession planning could lead
to the loss of key talent and disruption
to the business.

• Single points of failure may result in loss
of critical knowledge where these are
not mitigated.

EMIS Group has the following measures in place:

• Alignment of Group strategy with planned and published government policy on healthcare and

technology, ensuring products meet the essential requirements of the NHS’s current and future

major frameworks;

• Close engagement with the NHS at strategic and tactical levels;

• Increasing diversification of the Group’s business, reducing reliance on the NHS as a revenue

source with a stated target of achieving a balance between NHS and non-NHS revenues (for

example, research and life sciences) over time through organic growth and acquisition;

• Focus dedicated to ongoing GP IT Futures call off competitions;

• Continued significant investment in clear, product-led strategies;

The opportunity for EMIS Group is

to align its strategy to policy, so that

its products and services deliver the

integrated and interoperable solutions

that the market is seeking to procure.

This positions the Group as a trusted

high-tech supplier delivering at every

level from end user experience through

to government strategy.

LINK TO STRATEGIC PRIORITIES

• EMIS-X will provide extensive integration and interoperability across both Group and third party

products and will serve both the NHS and the wider healthcare sector;

• EMIS Group strives to ensure it is perceived as a supplier of integrated healthcare IT solutions

and regularly monitors key markets and competitors; and

• Customer experience measures are continually reviewed to ensure issues are resolved in a

timely manner.

The Group has in place a range of mitigating controls, including:

• Continued investment in new development, product and project management talent

and technologies;

• Adoption of strategic product portfolio management;

• Improved in-life software management processes including for software defects,

enhancements and clinical safety;

The opportunity is to build on the Group’s

strong history as a market innovator

and instigator of positive change, with

new software development that is both

technologically leading edge and in

alignment with customer requirements.

• Continued development of best practice standards and ways of working across all areas

LINK TO STRATEGIC PRIORITIES

of the product life cycle, using SAFe methodology;

• Close liaison between product and sales teams to create commercially attractive product

propositions supported by clear product roadmaps;

• Aligning product and development teams to specific business and strategic areas with cross-

functional teams to apply direct feedback from users and customers throughout the software

life cycle;

• Central team responsible for the architecture of the Group’s software, ensuring that its

platform continues to evolve as new technologies emerge; and

• Board-level responsibility for product and acquisition integration with a clear strategic plan

and regular monitoring in light of the changing healthcare market.

Key mitigating actions in place include:

• Continued empowerment and accountability through the Group’s matrix organisational structure;

• Group-wide refresh and communication of business values;

• Investment in line manager training to manage teams remotely;

• Significant focus on engaging employees, particularly during Covid-19;

• A clear and transparent performance management process;

• Strong internal communication, particularly extending the ‘Ask Andy’ online Chief Executive

Officer Q&A session to include other leadership team members;

• Team management objectives included in bonus achievement of senior leaders and EMIS Heroes

• Development of succession plans for key senior roles including identification and mitigation of

formal recognition programme;

single points of failure;

• Operating a regularly reviewed and externally benchmarked pay (including increasing wages from

1 April 2022 to cover the 1.25% national insurance increase) and benefits framework to ensure

greater consistency across the Group;

• A focus on physical, financial and mental wellbeing; and

• Creation of three diversity and inclusion groups, all led and participated in by employees.

The Group’s strategy to become an

employer of choice will lead to improved

recruitment and retention of talent.

Attracting and retaining highly skilled,

motivated employees will lead to better

business performance, enhancing the

Group’s good reputation as well as

financial return.

LINK TO STRATEGIC PRIORITIES

STRATEGIC REPORT

KEY TO STRATEGIC PRIORITIES

Sustainable financial growth

2 Technology innovation

3 User, customer and partner experience

4 ESG

DESCRIPTION OF RISK

WHY IS IT A RISK?

HOW WE MITIGATE THE RISK

OPPORTUNITY FOR EMIS GROUP

Healthcare

structure and

procurement

changes

The commercial

success of the Group

is dependent on the

healthcare sector’s

strategic direction to

use IT to reduce costs

and improve efficiency.

There is a risk that the Group’s products and services

The English primary care market remains the

are not in line with the sector’s strategies, or that these

largest single area of revenue for the Group.

will change as healthcare organisations’ plans continue

There is a risk that the Group may not be

to evolve.

Examples of this include the transition from Clinical

Commissioning Groups (CCGs) to ICSs and the planned

merging of NHS Digital and NHSX with NHS England

and NHS Improvement.

The NHS represents a significant proportion of the Group’s

revenues; how it is organised and procures goods and

services could affect the Group’s ability to sell effectively

to this market.

There is a risk that new competitors could cause market

disruption through customer adoption of new technologies

and/or changes in competitor business models. This could

include major global technology companies, which may

impact the Group’s market share and financial returns.

included on future frameworks which govern

procurement in this important area.

WHAT CAUSES THE RISK?

• Failure to achieve interoperability could

have a significant impact on the Group’s

ability to meet the government’s healthcare

technology requirements and to sell its

products and services in the longer term.

• Changes in the way healthcare is delivered,

such as increased remote/tele-health

services, may impact demand for different

solutions.

• Increased competition may affect market

shares or current pricing.

EMIS Group has the following measures in place:

• Alignment of Group strategy with planned and published government policy on healthcare and
technology, ensuring products meet the essential requirements of the NHS’s current and future
major frameworks;

• Close engagement with the NHS at strategic and tactical levels;
• Increasing diversification of the Group’s business, reducing reliance on the NHS as a revenue
source with a stated target of achieving a balance between NHS and non-NHS revenues (for
example, research and life sciences) over time through organic growth and acquisition;

• Focus dedicated to ongoing GP IT Futures call off competitions;
• Continued significant investment in clear, product-led strategies;
• EMIS-X will provide extensive integration and interoperability across both Group and third party

products and will serve both the NHS and the wider healthcare sector;

• EMIS Group strives to ensure it is perceived as a supplier of integrated healthcare IT solutions

and regularly monitors key markets and competitors; and

• Customer experience measures are continually reviewed to ensure issues are resolved in a

timely manner.

The opportunity for EMIS Group is
to align its strategy to policy, so that
its products and services deliver the
integrated and interoperable solutions
that the market is seeking to procure.
This positions the Group as a trusted
high-tech supplier delivering at every
level from end user experience through
to government strategy.

LINK TO STRATEGIC PRIORITIES

Developing excellent, robust and reliable software systems

The technical or physical failure of the

The Group has in place a range of mitigating controls, including:

• Continued investment in new development, product and project management talent

and technologies;

• Adoption of strategic product portfolio management;
• Improved in-life software management processes including for software defects,

enhancements and clinical safety;

The opportunity is to build on the Group’s
strong history as a market innovator
and instigator of positive change, with
new software development that is both
technologically leading edge and in
alignment with customer requirements.

• Continued development of best practice standards and ways of working across all areas

LINK TO STRATEGIC PRIORITIES

of the product life cycle, using SAFe methodology;

• Close liaison between product and sales teams to create commercially attractive product

propositions supported by clear product roadmaps;

• Aligning product and development teams to specific business and strategic areas with cross-

functional teams to apply direct feedback from users and customers throughout the software
life cycle;

• Central team responsible for the architecture of the Group’s software, ensuring that its

platform continues to evolve as new technologies emerge; and

• Board-level responsibility for product and acquisition integration with a clear strategic plan

and regular monitoring in light of the changing healthcare market.

is essential to the ongoing success of the business.

The Group’s products may be disrupted by competitors

if they develop more innovative technology.

Failure to implement cloud-based technologies may have

a significant impact in meeting customer demands.

To achieve its objectives, the Group has acquired several

businesses across a range of healthcare sectors. There is

The Group provides

a risk that these businesses do not function effectively as

a group, impacting on the success of product integration

across the sectors.

Group’s systems could lead to disruption or

complete service denial of high-profile public

or B2B services.

WHAT CAUSES THE RISK?

• The failure to monitor and rectify

software defects in time could result

in reduced customer satisfaction and

contractual penalties.

• Failure to deliver modern, interoperable

software platforms could have a significant

impact on the Group’s ability to sell

its products and services and upon its

reputation as the leading integrated

healthcare IT supplier to the NHS.

The risk to the Group is in not being able to recruit or retain

Failure to recruit or retain appropriate

Key mitigating actions in place include:

an appropriate calibre of employees.

As a result of Covid-19, the people landscape has altered

significantly with changes in career expectations, demands to

working and aspirations of new market entrants which has led

to an increase in this risk.

The Group’s response to Covid-19 resulted in a permanent

change in working patterns based on a new flexible way of

working, mainly from home. Whilst offices have reopened

as collaboration hubs to support this, there is a risk that the

Group does not optimise this approach, creating short-term

disruption and uncertainty that could lead to the loss of skills

and knowledge.

Failure to integrate acquisitions may result in strategic goals,

synergies and savings not being met.

numbers of qualified people in critical areas

could lead to a deterioration in quality of

products and services. This could result in

an inability to meet customers’ needs, loss of

business and the failure to deliver expected

financial returns.

WHAT CAUSES THE RISK?

• Low level engagement caused by a

poor culture could risk the retention of

critical employees and/or a reduction in

productivity and innovation.

• Lack of succession planning could lead

to the loss of key talent and disruption

to the business.

• Single points of failure may result in loss

of critical knowledge where these are

not mitigated.

• Continued empowerment and accountability through the Group’s matrix organisational structure;
• Group-wide refresh and communication of business values;
• Investment in line manager training to manage teams remotely;
• Significant focus on engaging employees, particularly during Covid-19;
• A clear and transparent performance management process;
• Strong internal communication, particularly extending the ‘Ask Andy’ online Chief Executive

Officer Q&A session to include other leadership team members;

• Team management objectives included in bonus achievement of senior leaders and EMIS Heroes

formal recognition programme;

• Development of succession plans for key senior roles including identification and mitigation of

single points of failure;

• Operating a regularly reviewed and externally benchmarked pay (including increasing wages from
1 April 2022 to cover the 1.25% national insurance increase) and benefits framework to ensure
greater consistency across the Group;

• A focus on physical, financial and mental wellbeing; and
• Creation of three diversity and inclusion groups, all led and participated in by employees.

The Group’s strategy to become an
employer of choice will lead to improved
recruitment and retention of talent.
Attracting and retaining highly skilled,
motivated employees will lead to better
business performance, enhancing the
Group’s good reputation as well as
financial return.

LINK TO STRATEGIC PRIORITIES

EMIS Group plc | Annual report and accounts 2021

Technology

and software

development

innovative and

interoperable IT

healthcare systems

that are critical to the

efficient and effective

operation of a wide

range of healthcare

organisations.

People

and culture

The Group is reliant

on the skills and

knowledge of its

people, especially in

software development

and infrastructure,

clinical safety

and information

technology systems.

Principal risks and uncertainties continued

DESCRIPTION OF RISK

WHY IS IT A RISK?

HOW WE MITIGATE THE RISK

OPPORTUNITY FOR EMIS GROUP

Information
governance
and cyber
security

The Group holds
significant volumes
of confidential and
sensitive personal
data, particularly in
the areas of hosting
patient care records
and processing
employee data.

Hosting personal data (in particular special category data such
as patient care records) carries risks associated with information
security, data protection and system reliability, including loss,
theft and corruption of data. Breaches may arise in relation to
any of the three pillars of information security: confidentiality,
integrity or availability.

Most reported data breach incidents are owing to human
error in inadvertently disclosing data, but attacks and malware
incidents continue to rise. The media report an increase in
blanket attacks by cyber criminals often backed by hostile
nation states targeting civilian and commercial organisations,
owing to the value of the personal and personal sensitive
data held.

The risks are perceived to have increased over the last year
through ransomware as a service (RaaS) and increased use
of cloud services.

Increasingly sophisticated phishing and social engineering
attacks remain a risk, particularly with the rise of
remote working.

EMIS Group’s trusted reputation rests on
its integrity and the quality of stewardship
it applies in respect of its customers’
sensitive data.

WHAT CAUSES THE RISK?
• The Data Protection Act 2018

(incorporating EU GDPR) and the Networks
and Information Systems Directive (NISD),
require appropriate and continually
maintained data security and information
governance controls. The Information
Commissioner’s Office (ICO) has leveraged
substantial fines to organisations suffering a
data breach and found with weak controls.
• Breaches could lead to reputational damage
and “class action” style claims where the
sums can become very significant.

Clinical
safety

As a provider of
critical IT systems to
healthcare providers,
the Group is exposed
to a range of
clinical risks.

These include risks associated with the use of clinical content
and algorithms in the Group’s products, which clinicians use in
day-to-day patient care.

For pharmacy software products, similar risks exist around
incorrect dosages and labelling of products dispensed.

The Group’s Patient business provides technology-based
enabling tools for the general public. There are no direct
clinical services provided by Patient.

There is an increasing use of artificial intelligence (AI) and
analytics within the healthcare area. As a result, an error
might magnify and have a major impact across a larger population
of individuals.

There is a risk of clinical harm to patients
should the software used by healthcare
professionals fail to provide accurate,
reliable and timely data, including patient
allergies, existing medication or other relevant
personal information.

WHAT CAUSES THE RISK?
• Similarly to information governance and

cyber security, there is a risk that a clinical
incident attributable to an EMIS solution
may result in potential “class action”
litigation being applied.

• These risks may be amplified where

Group systems interoperate with third
party applications.

An information governance (IG) framework has been established including the following

key features:

• Culture placing data and information governance at the heart of the business;

• A data governance board is responsible for enforcement of policy and compliance activities;

With a clear, dedicated focus on

information governance and cyber

security, the Group is able to operate in

the healthcare market with confidence

in its processes, products and services,

• All employees are required to complete annual information governance and security training,

inspiring, in turn, confidence in customers

including an NHS e-learning programme; and

and end users.

• Key policies and procedures are reviewed annually to meet corporate and regulatory compliance.

EMIS has a continual security improvement programme to raise the standards of technical

and non-technical controls across the Group through detailed reviews and assessments. This

combines an emphasis on security culture and human behaviour with training, education and

increasing awareness. The programme includes:

• Remote working security measures;

• Penetration testing and vulnerability scanning;

• Maintaining compliance to ISO 27001, ISO 22301, ISO 9001, ISO 20000 and Cyber

Essentials Plus;

• Comprehensive security education, communication and policy attestation;

• Cloud security measures for cloud platforms and services;

• Specialist cyber responders to manage breaches;

• Investment in the latest industry-leading security tools to prevent and detect cyber events/

incidents; and

• Cyber insurance.

recruitment and information governance could lead to clinical harm to patients.

Mitigating actions specific to clinical risk management include:

• Group Chief Medical Officer and a network of Clinical Safety Officers in place with

responsibility for clinical safety across the Group;

• Policies and procedures designed to meet the regulatory requirements of NHS Digital’s

clinical risk management standards DCB 0129;

• Policies and processes in place to meet regulatory standards for embedded algorithms and

• Accredited clinicians identify and mitigate potential clinical risks in new software development,

• Weekly KPI reports and a monthly clinical governance board chaired by the Group Chief

decision support;

releases and updates;

Medical Officer; and

• Oversight by external regulators.

Most clinical risks are allied to other principal risks. Failures in software development,

EMIS Group’s priority is to deliver the

highest standards of clinical safety. This is

an unswerving focus that runs through the

Group’s culture, creating an opportunity to

continue to build the trust of the healthcare

profession, leading to increased software

and service sales and customer retention.

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORT
DESCRIPTION OF RISK

WHY IS IT A RISK?

HOW WE MITIGATE THE RISK

OPPORTUNITY FOR EMIS GROUP

KEY TO STRATEGIC PRIORITIES

Sustainable financial growth

2 Technology innovation

3 User, customer and partner experience

4 ESG

Information

governance

and cyber

security

The Group holds

significant volumes

of confidential and

sensitive personal

data, particularly in

the areas of hosting

patient care records

and processing

employee data.

Hosting personal data (in particular special category data such

EMIS Group’s trusted reputation rests on

as patient care records) carries risks associated with information

its integrity and the quality of stewardship

security, data protection and system reliability, including loss,

it applies in respect of its customers’

theft and corruption of data. Breaches may arise in relation to

sensitive data.

any of the three pillars of information security: confidentiality,

integrity or availability.

Most reported data breach incidents are owing to human

error in inadvertently disclosing data, but attacks and malware

incidents continue to rise. The media report an increase in

blanket attacks by cyber criminals often backed by hostile

nation states targeting civilian and commercial organisations,

owing to the value of the personal and personal sensitive

data held.

The risks are perceived to have increased over the last year

through ransomware as a service (RaaS) and increased use

of cloud services.

WHAT CAUSES THE RISK?

• The Data Protection Act 2018

(incorporating EU GDPR) and the Networks

and Information Systems Directive (NISD),

require appropriate and continually

maintained data security and information

governance controls. The Information

Commissioner’s Office (ICO) has leveraged

substantial fines to organisations suffering a

data breach and found with weak controls.

• Breaches could lead to reputational damage

and “class action” style claims where the

Increasingly sophisticated phishing and social engineering

sums can become very significant.

attacks remain a risk, particularly with the rise of

remote working.

With a clear, dedicated focus on
information governance and cyber
security, the Group is able to operate in
the healthcare market with confidence
in its processes, products and services,
inspiring, in turn, confidence in customers
and end users.

LINK TO STRATEGIC PRIORITIES

An information governance (IG) framework has been established including the following
key features:

• Culture placing data and information governance at the heart of the business;
• A data governance board is responsible for enforcement of policy and compliance activities;
• All employees are required to complete annual information governance and security training,

including an NHS e-learning programme; and

• Key policies and procedures are reviewed annually to meet corporate and regulatory compliance.
EMIS has a continual security improvement programme to raise the standards of technical
and non-technical controls across the Group through detailed reviews and assessments. This
combines an emphasis on security culture and human behaviour with training, education and
increasing awareness. The programme includes:

• Remote working security measures;
• Penetration testing and vulnerability scanning;
• Maintaining compliance to ISO 27001, ISO 22301, ISO 9001, ISO 20000 and Cyber

Essentials Plus;

• Comprehensive security education, communication and policy attestation;
• Cloud security measures for cloud platforms and services;
• Specialist cyber responders to manage breaches;
• Investment in the latest industry-leading security tools to prevent and detect cyber events/

incidents; and
• Cyber insurance.

Clinical

safety

As a provider of

critical IT systems to

healthcare providers,

the Group is exposed

to a range of

clinical risks.

day-to-day patient care.

For pharmacy software products, similar risks exist around

incorrect dosages and labelling of products dispensed.

The Group’s Patient business provides technology-based

enabling tools for the general public. There are no direct

clinical services provided by Patient.

There is an increasing use of artificial intelligence (AI) and

analytics within the healthcare area. As a result, an error

might magnify and have a major impact across a larger population

of individuals.

professionals fail to provide accurate,

reliable and timely data, including patient

allergies, existing medication or other relevant

personal information.

WHAT CAUSES THE RISK?

• Similarly to information governance and

cyber security, there is a risk that a clinical

incident attributable to an EMIS solution

may result in potential “class action”

litigation being applied.

• These risks may be amplified where

Group systems interoperate with third

party applications.

These include risks associated with the use of clinical content

There is a risk of clinical harm to patients

and algorithms in the Group’s products, which clinicians use in

should the software used by healthcare

Most clinical risks are allied to other principal risks. Failures in software development,
recruitment and information governance could lead to clinical harm to patients.

Mitigating actions specific to clinical risk management include:

• Group Chief Medical Officer and a network of Clinical Safety Officers in place with

responsibility for clinical safety across the Group;

• Policies and procedures designed to meet the regulatory requirements of NHS Digital’s

clinical risk management standards DCB 0129;

EMIS Group’s priority is to deliver the
highest standards of clinical safety. This is
an unswerving focus that runs through the
Group’s culture, creating an opportunity to
continue to build the trust of the healthcare
profession, leading to increased software
and service sales and customer retention.

• Policies and processes in place to meet regulatory standards for embedded algorithms and

LINK TO STRATEGIC PRIORITIES

decision support;

• Accredited clinicians identify and mitigate potential clinical risks in new software development,

releases and updates;

• Weekly KPI reports and a monthly clinical governance board chaired by the Group Chief

Medical Officer; and

• Oversight by external regulators.

EMIS Group plc | Annual report and accounts 2021

Viability statement

The Directors have voluntarily adopted provision 31 of the Code,
assessing the prospects of the Group. The Directors have taken into
account the Group’s current position and business model and have
assessed the potential impact of the principal risks and uncertainties
facing the Group.

The Directors have determined that the four-year accounting period
to 31 December 2025 constitutes an appropriate period over which to
assess the Group’s prospects and viability. This is the period focussed
on by the Board during its strategic planning process and is consistent
with typical contract lengths across much of the Group (three to five
years). It is aligned with the Group’s goodwill and other intangible
impairment testing and the earlier part of the period is also covered
by the Group’s funding facilities, which currently extend to December
2024 with two further one year extensions anticipated, and which the
Group expects to be able to renew on comparable terms.

While the formal assessment period extends to December 2025, the
Board considers that the Group’s longer-term prospects are likely to
be positive beyond this time horizon as a result of its investment in
innovation, increasing market demand for its products, market growth,
strong competitive positions and contractual visibility.

For the purpose of making this viability statement, the Board has taken
into account its ongoing assessment of the principal risks facing the
Group, including those that could potentially threaten its business
model, future performance, solvency or liquidity. Each year, the
Board considers a medium-term strategic plan, the first year of which
represents the Group’s annual operating budget, together with the
ability of the Group to raise finance and undertake mitigating actions
to avoid the occurrence or reduce the impact of the principal risks.

In assessing viability, enhanced modelling and stress testing are
performed, using severe but possible scenarios on the financial
impact of risks materialising. The modelled scenarios were:

Scenario 1
Increased market competition linked to the GP IT Futures framework
results in reduction in related revenues.

All related revenues reduce by 5% from January 2023, by a further 5%
from January 2024 and by a further 10% from January 2025. All other
revenues are limited to a 2% growth rate.

Link to principal risk and uncertainties: healthcare structure and
procurement changes.

Scenario 2
The failure to monitor and rectify software defects on a timely basis
could result in reduced customer satisfaction.

Revenues are reduced by 10% due to customer attrition and staff costs
are reduced by 5% from January 2023 in response to customer losses.

Link to principal risk and uncertainties: technology and software
development.

Scenario 3
Failure to recruit or retain appropriate numbers of suitably qualified
people in critical areas could lead to a deterioration in the quality of
products and services. This could lead to failure to meet customers’
needs, loss of business and the Group failing to deliver expected
financial returns.

The annual staff attrition rate increases to 25% and new staff are 10%
more expensive than leavers resulting in an effective 2.5% increase in
staff costs from January 2023 onwards.

Link to principal risk and uncertainties: people and culture.

Scenario 4
There are failures to comply with information governance legislation,
including the EU GDPR.

Revenues reduce by 20% from January 2023, staff costs and operating
expenses reduce by 10% from January 2023 and a fine of £1m is
imposed by the ICO in December 2023.

Link to principal risk and uncertainties: information governance
and cyber-security.

Further details on each of these are set out on pages 36 to 37.

In addition, the Board has also considered the possible impact of the
ongoing business disruption arising as a result of Covid-19. Based on
the Group’s experience of 2020 and 2021 trading, the Directors expect
to be able to trade through any further disrupted periods resulting from
the pandemic without this challenging its longer-term viability. Any
future impact of Covid-19 is considered likely to be only short-term in
nature and has therefore only been specifically considered in assessing
the going concern assumption.

The Group’s strong contractual forward visibility of revenues,
significant cash resources and strong cash conversion provide some
inherent protection against unexpected shocks to the business model.
In the event of these scenarios arising, various options are available
to the Group in order to maintain liquidity, including: utilisation of
undrawn debt facility; reduction to cost base; reduction to future
investment capital expenditure; and amendment to dividend policy.

The Directors have made their viability assessment based on the
following key assumptions:

• The political environment in which the NHS exists will not result
in major structural change to the market in which the Group
operates; and

• Funding for the business will continue to be available in all plausible

market conditions.

Taking into account the Group’s current position and principal
risks and uncertainties, the Directors confirm that they have a
reasonable expectation that the Group will be able to continue in
operation and meet its liabilities as they fall due over the period to
31 December 2025.

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORTSustainability
ESG report

A sustainable
future

Dear Shareholder
On behalf of the Board I am pleased to present the EMIS Group plc
ESG report for the year ended 31 December 2021.

The Board recognises the value and importance of a good
environmental, social and governance strategy. The framework we
are implementing will underpin the Group’s ability to achieve its
strategic goals.

EMIS prides itself on putting its customers and employees first, and this
has been especially important through the challenges of the last two
years. Throughout the pandemic, we continued with our purpose to be
the leading provider of innovative healthcare technology that improves
people’s lives.

During the second half of 2021 we carried out a materiality assessment
to help us gain a deeper understanding of which ESG matters are
most important to our stakeholders, focussing on those that can
deliver the maximum impact and improvement. This was undertaken
by an independent sustainability firm (further details can be found on
page 40).

At the end of the year we formed an ESG committee to review the
findings of the materiality assessment, assist the Group in setting out
a clear strategy and focus on those issues that matter most to our
stakeholders. The committee will provide a governance structure to
enable us to step forward with clarity and purpose as we work towards
EMIS Group’s sustainable future.

In the forthcoming year, our focus is firmly on starting to implement our
strategy and setting targets to become carbon neutral by 2030. In the
longer term we aim to align with the principles of the United Nations
Sustainability Development Goals (UNSDG). I look forward to providing
you with further information as our ESG journey continues.

Patrick De Smedt
Chair
24 March 2022

35 years

of driving positive change through technology

EMIS Group plc | Annual report and accounts 2021

ESG report continued

OUR
ENVIRONMENTAL
RESPONSIBILITIES

DELIVERING
SOCIAL VALUE TO
OUR COMMUNITY

OUR PEOPLE
AND CULTURE

OUR
RESPONSIBILITIES
AS A BUSINESS

56%

of the company fleet
now hybrid

60%

of UK electricity
consumption from
renewable/low carbon
providers

100m

16%

Covid-19 vaccinations
recorded on EMIS software

employee forum meetings
held during 2021

reduction in gender pay gap
as published in 2021

1.5m
people

identified for priority
vaccinations through
EMIS-powered research

87%

of employees agreed that
EMIS met its targeted
engagement metrics

10.5%

reduction in total energy
consumption for the UK

15.7bn

prescription items processed
through the lifetime of EMIS
Web

mental health first aiders

121
members

of the clinical team
meticulously oversee new
developments

99%

of staff trained in
governance policies

Materiality assessment
It is important that the Board understands the issues that matter
most to stakeholders, ensuring that there is a strong link to EMIS’s
strategic objectives. The Group undertook a materiality assessment
to understand these priorities, which involved:

• A desktop review of information available internally and externally,

which provided an extensive list of the ESG topics and issues
deemed important.

• A survey sent to stakeholders, including all employees and a range of
suppliers, partners, customers and investors, to gather a wide range
of views on ESG matters.

• In-depth interviews with various internal and external stakeholders.
This included Executive Directors, investors, suppliers, customers,
partners and employees, to capture a rounded view of issues central
to the business. Interviewees were asked to rank the extensive list in
terms of most to least important.

• A Group business impact assessment of the information supplied.

The graph opposite shows the results of this assessment, highlighting
the issues that are of most interest or concern to stakeholders and their
importance to the business. Some issues that have been identified as
high importance and high business impact are already prioritised by the
business and have mitigations in place. For example the areas of data
privacy and security or ethics and compliance. The targets and priorities
focus on areas where the Group wants to make improvements.

r
e
h
g
H

S
R
E
D
L
O
H
E
K
A
T
S
O
T
E
C
N
A
T
R
O
P
M

r
e
w
o
L

EMIS Group plc | Annual report and accounts 2021

• Training and
development

• Health, safety and wellbeing

• Data privacy
and security

• Ethics and compliance

• Attractiveness to employees
• Diversity

• Innovation

and inclusion

• Modern slavery and human rights

• Reducing

carbon emissions

• Sustainable
supply chain

• Resource efficiency

• Waste

management

• Community
engagement

Lower

BUSINESS IMPACT

Higher

STRATEGIC REPORT

Following the assessment, the GXT held a number of ESG focussed
workshops to gain a more in-depth understanding and agree the top
priorities for the Group and set strategic goals.

The table below shows the priorities agreed, the corresponding
outcome of the materiality assessment and alignment with the
Group’s current strategic goals as outlined on pages 18 and 19.

PRINCIPLE

MATERIALITY ISSUES

PRIORITIES

KPIS

Reducing
carbon emissions

Managing energy and carbon
emissions from direct and
indirect operations (Scope 1, 2
and 3), use of renewable energy
sources and carbon offsetting.

• Measurement and review
of additional Scope 3
emissions beyond the ones
reported to date.

• Implement plans to be carbon

neutral by 2030.

• Implement a plan during 2022 to

measure and reduce Scope 3 emissions.

• Move to 100% renewable energy

contracts for EMIS-owned offices by
the end of 2022.

• 100% of company cars to be

electric by 2026.

• Procure responsible carbon offsets

for Scope 1 and 2 in 2022.

• Move to fully recyclable supply chain
for packaging by the end of 2024.

Sustainable
supply chain

Innovation

Ensuring that suppliers have
strategies and measures in place
to drive ongoing improvements
to their sustainability
performance, including prompt
payment and fair terms. Ensuring
suppliers are managing their
sustainability risks, including
human rights, modern slavery
and resilience to climate change.

Staying at the forefront of
technological innovation in
healthcare software to provide
the highest quality service for
customers and integrate green
technology opportunities, such
as digitising paper processes.

Employer
attractiveness

Attracting and retaining top
talent and meeting employee
expectations by providing
competitive salaries and benefits
as well as enhancing diversity
and inclusion.

• Implement a verifiable ethical

• Amend the procurement and

supply chain by 2024.

contracting governance process to
include clear measures that support
the ESG strategy during 2022.

• Hold a supplier event during 2022 to
brief suppliers and partners on the
Group ESG strategy, expectations
and partnering approach.

• Evaluate environmentally friendly

• Cloud carbon output report.

choices for cloud solutions.

• Use energy-efficient

development code that can
reduce customers’ power
consumption.

• Use analytics to identify
and inform customers of
opportunities to reduce their
environmental impact.

• Measure number and power

consumption of infrastructure
on premises.

• Use analytics technology to inform the

public of environmental factors that may
affect their health, such as pollen count.

• Focus on progressing the

• Agree employer of choice priorities and

employer of choice programme.

implementation dates during 2022.

Diversity
and inclusion

Promoting an inclusive culture
that respects and values people’s
differences and reflects the
customers EMIS serves.

• To increase gender diversity

at Board and senior
management level.

• Create and implement a volunteering

policy during 2022.

• At least 33% female representation
on the Board by the end of 2023.

• 40% female representation in

senior management positions by
the end of 2025.

• Review current gender and ethnicity pay
gaps and introduce further corrective
measures during 2022.

• Reduce gender pay gap to 5% or lower
and reduce ethnicity pay gap to 16% or
lower during 2022.

EMIS Group plc | Annual report and accounts 2021

ESG report continued

Environment

Committed to reducing environmental impact

As a mainly homeworking software development business, EMIS’s activities
do not involve any energy-intensive processes or generate significant
waste. Nonetheless, EMIS is committed to reducing its environmental
impact and is developing a new Group-wide environmental strategy to
establish and measure improvement in this area. This will build on what
the business has achieved so far and embrace its new remote, flexible
and collaborative ways of working across a simplified and reduced
property portfolio.

EMIS has committed to becoming carbon neutral by 2030 across its
operations. Working with suppliers, customers and partners on an ESG
agenda is a priority and as a key supplier to the NHS, EMIS is supporting
the NHS’s net zero plan.

EMIS changed the packaging used by its warehouses to materials made
from recycled fibres (75% for cardboard packaging, 50% for plastic
packaging). The business switched to corrugated cardboard boxes with the
highest recycling rates and bubble wrap made from low density polythene,
which has a lower carbon footprint than other plastics. A new cardboard
shredder recycles cardboard waste into packaging for the warehouse,
reducing the amount of bubble wrap used.

On World Earth Day in April 2021, EMIS planted 25 saplings for each
new starter that had joined the business during the previous twelve
months, resulting in more than 4,800 new saplings planted in countries
that have been badly affected by deforestation through the environmental
organisation, Ecologi. In addition, during the year EMIS donated more than
1,300 electrical waste items to charities.

EMIS supports its end customers’ objectives to reduce their carbon
footprint with digital alternatives to original paper-based processes. This
includes the electronic prescription request service between GP practices
and pharmacies, and patient repeat prescription requests via Patient
Access. EMIS has facilitated digital consultations through integrated
telephony and video, which has reduced or eliminated patients’ need
to travel.

The Group is looking to move all its electricity contracts for EMIS-owned
offices to renewable or low carbon providers by the end of 2022. 60%
of the Group’s UK electricity consumption is now from renewable or low
carbon providers.

In 2021 EMIS chose to measure emissions from travel booked through
the Group portal as a voluntary Scope 3, as part of its target to measure
all elements of Scope 3. The CO2 emissions recorded for Group travel in
the UK reduced by 42% in 2021 to 48.54 tCO2e (2020: 83.24 tCO2e).

The Group also started to measure Scope 2 energy consumption for its
Chennai office and this information is reported in the greenhouse gas
emissions table.

Refurbishment works across EMIS’s sites continued, including
implementing LED lighting and upgraded technologies for air handling in a
plant room, as well as ceasing to use gas at one of the Leeds sites, helping
to reduce emissions during the year.

2022 priorities
The actions below will take the Group closer to the long-term ambition
of becoming carbon neutral by 2030:

• Implement plans to reduce Scope 1 and 2 emissions further and procure

responsible carbon offsets for Scope 1 and 2.

• In-depth review of the remaining Scope 3 emissions and implement

a plan to reduce those carbon emissions.

• Review business and property portfolio and produce plan to reduce

emissions.

• Review requirements for TCFD in preparation to report on this in line

with the guidelines.

• Embed environmental awareness into the culture of EMIS, delivering
employee training on energy consumption and waste management.

2021 highlights
EMIS’s company fleet is now 56% hybrid (2020: 50%). EMIS is committed
to the company fleet comprising 100% electric only vehicles by 2026,
strengthening the previous commitment of a 100% hybrid/electric fleet.
Six electric charging points were implemented at each of the two Leeds
sites during the year. The Group launched a salary sacrifice scheme for
employees to lease electric cars in November 2021.

Streamlined energy and carbon reporting
requirements (SECR) statement
EMIS measures and reports on energy and carbon data across its
UK business, providing comprehensive data to assess its overall
environmental impact for Scope 1 and 2 and mandatory Scope 3. Scope
1 covers direct emissions from owned or controlled sources. Scope 2
covers indirect emissions from the generation of purchased electricity,
steam, heating and cooling consumed by the reporting company.

Case study
What ESG means to me

Harvey McGrail
Warehouse and
Logistics
Operative

Historically in the warehouse, we packaged
items using plastic materials such as bubble
wrap. We could use up to twelve rolls a
month, which equates to 600 metres!

Over the last few years we’ve become
more environmentally aware by packaging
products made from recycled materials.
In the past six months we’ve invested in
a cardboard shredder, which allows us to
re-use boxes and turn them into packing

material, removing most of the need
for plastic.

In 2022, we’re looking at removing more
plastic by using a new paper-based “bubble
wrap”, which will be used as the final
protective layer around an item. We’re also
transitioning to paper packing tape.

It’s important for us to be taking these
steps to ensure we’re responsible and are
minimising our impact on the environment.

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORTOur ambition:
become carbon
neutral by 2030

Mandatory Scope 3 covers indirect emissions from the grey fleet. In
2021 EMIS chose to measure additional Scope 3 emissions, generated
from travel booked through the EMIS portal. The Group also measured
energy consumption for its Chennai office in 2021.

In the coming years, the Group will look to include measurement of
other Scope 3 emissions as part of an ongoing commitment to continual
improvement. Scope 3 includes all other indirect emissions that occur in
a company’s value chain.

EMIS’s SECR statement includes all emission sources required under
the 2019 regulations for the financial year ended 31 December 2021
and a comparison to the 2020 data. It uses the UK government’s GHG
conversion factors for company reporting and the climate transparency
(2021 report) – India. The report uses the metric of revenue (£m) as the
intensity ratio.

Intensity ratio (UK only)1

Total
revenue
2021
£’m

168.2

Total
revenue
2020
£’m

kWh/
revenue
2021
£’m

kWh/
revenue
2020
£’m

159.5

28,396

33,460

tCO2e/
revenue
2021
£’m

6.22

tCO2e/
revenue
2020
£’m

7.88

1 The figures include updated energy consumption data from a UK site and

additional Scope 3 data from the Group’s travel portal. The 2020 data has been
adjusted accordingly.

Greenhouse gas emissions1

Scope 1 – tonnes of CO2e3

Total Scope 1

Scope 2

Scope 3

– Natural gas
– Other fuels
– Travel
– tonnes of CO2e3
– tonnes of CO2e
– tonnes of CO2e4

Total carbon footprint – tonnes of CO2e
Scope 1 – energy use (kWh)3 – Natural gas
– Other fuels
– Travel
– energy use (kWh)3

Total Scope 1

Scope 2 energy use (kWh)

Scope 3 energy use (kWh)4

Total kWh

Carbon offsets in tonnes of CO2e5

2021

2020

UK only
emissions

Global
emissions
(excluding UK) 2

UK only
emissions

Global
emissions
(excluding UK) 2

38
1
240
279

719

1,047

208,881
4,362
968,209
1,181,452

—
—
—
—

201

—

201

—
—
—
—

41
2
292
335

839

1,257

223,078
8,400
1,160,732
1,392,210

—
—
—
—

231

—

231

—
—
—
—

3,383,884

283,972

3,599,437

326,332

210,936

—

345,210

—

4,776,272

283,972

5,336,857

326,332

2,140

—

1 Figures have been rounded to the nearest whole number.

2 In 2021 EMIS started to measure Scope 2 energy consumption for its Chennai

office and was also able to produce data for 2020.

3 Scope 1 figures include updated energy consumption data from a UK site and the

2020 data has been adjusted accordingly.

4 Additional Scope 3 emissions are included for business travel from the Group’s

travel portal – rail, air, sea and hotel accommodation. 2020 data has been adjusted
to include these additional emissions.

5 The 2,140 tonnes of carbon offset has been purchased through Ecologi,
an organisation that partners with climate projects worldwide to offset
carbon emissions.

Total energy consumption for the UK decreased by 10.5%, while emissions
decreased by 16.8%:

Scope 1 consumption decreased by 15.1% and emissions by 16.5%. This
reduction was mainly due to a lower level of business miles. There was
greater visibility of company car vehicle type, which resulted in a more
accurate calculation of emissions.

Scope 2 consumption decreased by 6.6% and emissions by 14.4%. This
reduction was mainly owing to the closure of two sites as the business
moved to predominantly homeworking, consolidating office spaces into
collaboration hubs.

Scope 3 consumption decreased by 38.9% and emissions by 41.7% because
of reduced travel during the pandemic and an increase in digital meetings.

EMIS Group plc | Annual report and accounts 2021

ESG report continued

Social

Committed to social value

As a supplier to the healthcare industry and with the NHS as its largest
customer, EMIS’s technological innovations, projects and software has
a positive impact on the wider UK society. At an individual level, EMIS
helps patients access healthcare services quickly and conveniently.
At end user level, the Group’s unswerving commitment to providing
excellent technology means that clinicians have the software they need
to deliver the best possible patient care. On a national level, EMIS’s
collaborative work with government, academic, data and life sciences
research organisations means that the business is playing a significant
role in new data-led insights that improve population health on a
macro scale.

EMIS’s social impact
Clinicians
EMIS’s purpose is to be the leading provider of innovative healthcare
that improves people’s lives. Every development EMIS makes to speed
up a process helps the clinician to spend more time on patient care.
At individual user level this means more patient engagement. On a
macro level those minutes saved add up to increased efficiency of the
NHS and reduced costs. For example, the Covid autofiler released in
November 2021 automatically files Covid-19 vaccinations into patient
records. More than 10 million vaccinations were automatically filed in
the first three months, with a saving of approximately three minutes per
vaccination, saving 18.5 days per practice across the three months –
time that can be spent on patient care.

Recently EMIS enabled GPs and community pharmacists to carry out
consultations digitally through the pandemic, as well as making many
behind the scenes fast adaptations to systems. This includes searches
to identify the 1.5 million people most at risk from Covid-19 to identify
priority cohorts for early vaccination. Many rapid changes have been
needed and the close collaboration between EMIS and NHS Digital
meant that GPs had the technology they needed to support their
patients in a fast-changing environment.

The health of the UK population
EMIS has long supported ethical clinical research to facilitate better
patient outcomes on a national scale. EMIS co-founded QResearch
in 2003, one of the world’s largest research databases of primary
care records used for anonymised healthcare research. Much of
this research has helped refine and improve patient care for many
conditions, such as heart disease.

More recently, a collaboration between EMIS and OpenSAFELY is
delivering important new insights into Covid-19 including the under-
reporting of Long Covid.

To date, EMIS has enabled more than 100 million Covid-19 vaccinations
in England to be recorded at the point of care and shared through
interoperability to the National Immunisation Management System
(NIMS) and GP clinical systems. EMIS teams worked incredibly hard to
be ready for day one of the vaccination programme and for most of
2021, OutcomesforHealth was the only system able to support out-of-
hospital Covid-19 vaccinations.

EMIS works with many charities to support vulnerable populations
– often at no charge to the NHS. This includes work with Sepsis UK,
Macmillan and The Terrence Higgins Trust to ensure that best practice
and improved care pathways are incorporated into its clinical systems.

Moving into the research and life sciences market offers further
opportunities to improve healthcare at scale. A 2018 paper by the National
Centre for Biotechnology Information notes that only 31% of UK clinical
trials meet enrolment goals. Covid-19 has demonstrated how vital clinical
trials are to quickly bring new treatments onto the market to improve
national healthcare. With EMIS-X Analytics, the UK life sciences industry
and the NHS can more quickly find eligible patients to participate in clinical
trials, speeding up this vital part of improving UK health.

Individuals
For more than 20 years EMIS has provided reliable, accurate, GP-
authored and peer-reviewed health information to the UK general
public free via Patient.info. The Group is continually improving its
information and services for patients, offering a “digital front door”
to order repeat prescriptions and book health services, including
GP appointments and community pharmacy services such as flu
vaccinations or medication usage reviews.

2022 priorities
The actions below will enable the Group to further improve NHS
outcomes for individuals and address health inequality during 2022:

• Further support local schools and partnerships with refurbished hardware.

• Create a plan of activity to use analytics technology to inform the
public of environmental factors that may affect their health in real
time, such as pollen count and pollution alerts for asthmatics.

Case study
What ESG means to me

Lavanya Rajaram
Product Owner

EMIS has many benefits for employee wellbeing. I was able to take
leave when I had Covid-19, which gave me time to recover. The
introduction of the new marriage leave for employees in Chennai
gave me some additional time to cherish my wedding.

My experience with EMIS has made me who I am today. I feel a
real sense of accomplishment and I love the people I work with
and the freedom to choose ways of working that work best for me.

EMIS Group plc | Annual report and accounts 2021

STRATEGIC REPORTOur ambition:
improve NHS outcomes for
individuals and address
health inequality

Case study

What ESG means to me

Emma Coulson
Head of Clinical Implementation Service
To help support the improvement of cancer care, we’ve worked
closely with Macmillan Cancer Support to develop a number of
electronic tools and resources for healthcare professionals.

In 2017 Macmillan approached us with a request for us to digitise
their cancer care review pathway. This care pathway provides
resources and information for primary care professionals to identify,
manage and support their patients’ cancer treatments. As a result
of EMIS developing the first iteration of the pathway, Macmillan
was then able to replicate this in other core clinical systems and
additional platforms that have since become available. This resulted
in Macmillan’s cancer care review pathway being adopted in national
Quality and Outcomes Framework guidance.

From this foundation we’ve worked with Macmillan over the past five
years to enhance and implement information and support through
our clinical resources; for example, a new direct referral form means
that when people living with cancer are having conversations with
their primary care professional, they can be referred directly to the
right Macmillan support team to enable them to get the information
and support they need.

Our suite of cancer care review and end of life care quality
improvement reports can help clinicians review rates of screening
uptake, referrals for suspected cancer and completed cancer care
reviews, among many other crucial primary care activities. We also
provide searches relating to the provision of information about
cancer support services.

While working with EMIS, we’ve been
able to innovate, test ideas and
implement real changes, which has
allowed us to scale interventions to
reach more people living with cancer.”

Sophia Nicola,
Head of Clinical Engagement for Macmillan

EMIS Group plc | Annual report and accounts 2021

ESG report continued

Our people and culture

Committed to living the EMIS values

Conscientious employer
EMIS takes its responsibility of employing more than 1,400 people in
the UK and India seriously. The business ensures its actions, working
environment and policies prioritise employee wellbeing. This includes
reward and recognition schemes, a flexible and considerate working
approach during the pandemic and a growing diversity and inclusion
programme.

EMIS believes that making positive changes within the organisation
contributes to a positive ripple effect on society as a whole.

Communication and engagement
EMIS culture is built on close collaboration: it’s one of the reasons
the business has thrived as a home working organisation since 2020.
Colleagues are actively encouraged to share their views, good and bad,
through regular employee surveys and the employee forums.

Feedback is frequently shared with the Board, the leadership team and
through team meetings in the spirit of openly discussing challenges and
working to resolve them together.

Weekly and monthly internal communications keep colleagues up to
date on the business. The Group’s Yammer site has an informal, friendly
feel where colleagues are actively encouraged to share their good news
and participate in wellbeing initiatives. The regular ‘Ask Andy’ series has
continued, with colleagues invited to ask questions to the Chief Executive
Officer and the senior team, improving employee engagement, connection
to the business purpose and senior leadership visibility.

Managers took part in training sessions focussed on great leadership. In
addition, EMIS ran a number of wellbeing education sessions ranging from
nutrition to better sleep to menopause guidance.

Employee benefits
EMIS continues to extend its range of benefits for employees as it moves
towards its ambition to become an employer of choice. During 2021 EMIS
further tailored benefits packages for employees in the UK and India.

In the UK, EMIS has committed to increasing all basic salaries on 1 April
2022 by 2%, as a minimum, in addition to other plans for salary and
benefits enhancement. To improve the voluntary benefits offering in close
alignment with EMIS’s ESG strategy, during 2021 the Group launched a
salary sacrifice electric car scheme, enhanced the cycle to work scheme
and introduced a tree planting scheme where employees can help to offset
their carbon footprint.

EMIS launched a new UK employee-assistance programme during 2021,
We Care, which offers physical and mental health support as well as
advice and guidance on financial wellbeing. To reward the teams for hard
work during the challenging pandemic period, the Group gave every EMIS
employee two days extra holiday during 2021.

In Chennai, EMIS provides free unlimited GP consultations for all
employees and their families, as well as an annual health check. During
2021 the Group introduced Covid-19 leave for employees in Chennai,
reimbursed the cost of vaccinations for all staff and donated to the PM
CARES Fund constituted by the government of India for Covid-19 relief.

When surveyed on communication and engagement, 87% of employees
across the UK and India found the weekly internal bulletin an effective way
of remaining informed. 92% said that their manager keeps them informed
of essential information and 87% felt that the senior leadership team is
visible and accessible.

During 2022 EMIS will launch new benefits for its employees in Chennai,
following feedback on what colleagues would find most valuable via
surveys and employee forums. Additional benefits introduced in January
2022 include marriage leave, extended flexible paternity leave and
increased full-pay maternity leave.

During 2021 the HR team launched the EMIS Hub, a central intranet
where employees can find everything they need to know about working at
EMIS, from policies to the latest internal communications, book a hot desk
at a collaboration hub or link to the benefits portal.

Wellbeing
The leadership team is encouraged to make discussions on wellbeing a
regular feature of team meetings and in staff one to ones. It’s no secret the
pandemic has been challenging to many individuals but EMIS has created
a culture of people who pull together in a crisis. The 20-strong team
of trained mental health first aiders in both the UK and India typify the
supportive culture of EMIS.

The EMIS Heroes programme actively encourages employees to show
recognition to their colleagues to say thank you, with a quarterly and
annual Group-wide recognition initiative rewarding nominated employees
with a voucher.

Personal development
EMIS made LinkedIn Learning available to every employee during 2021,
providing free access to expert courses on subjects relating to work or
personal development topics. The Perform framework was launched mid-
year, giving guidance on objective setting and performance management to
bring out the best in EMIS people.

EMIS Group plc | Annual report and accounts 2021

SIP
The SIP encourages tax-advantaged employee ownership of the Group’s
shares and is offered to all UK employees with over six months’ service.
During the year the scheme was improved to provide one matching share
for every two shares purchased by employees.

In April 2021, as a recognition of contribution to the Group’s success in
the last financial year, the Group offered a free award of shares, which was
taken up by all 1,099 eligible UK employees.

Pension contribution
In 2021, 94.8% of UK employees were actively contributing to a pension
scheme (2020: 92.5%). New employees are auto-enrolled into the
Group scheme.

Over the last seven years EMIS has consistently increased pension
contributions year on year. By April 2021, standard pension contributions
had been uplifted to 10.5% (5% employee and 5.5% employer). In 2022 a
further 0.5% increase in the minimum level of pension contribution from
the employer has been applied, taking standard total contributions to 11%.
This is part of a plan over the medium-term to align employer contribution
across EMIS employee grades.

STRATEGIC REPORTOur ambition:
become an employer
of choice by 2025

Employer of choice
EMIS has been working towards becoming an employer of choice for
a number of years, with enhanced benefits packages and improved
communication and engagement year on year. During 2021 EMIS
formalised this programme, utilising an external benchmark as a framework
for future activity.

An employer of choice working group will focus on developing a plan to
provide a workplace and culture that can attract and retain the best talent.
This includes inspirational leadership, ensuring great benefits for employees
and strengthening the positive EMIS culture.

2022 priorities
The actions below will take the business to the next stage on its continual
journey to become a great place to work:

• Create a plan of activity to progress the Group’s employer of choice

programme.

• Create and implement an employee volunteering scheme.

• Deliver unconscious bias training to all employees.

Case study

What ESG means to me

Koushik Narayanan
Software Engineer in Test
Last year I was admitted to hospital locally here in Chennai for a
severe medical condition and I was unable to work for two months.
During this time, EMIS really supported me with hospitalisation
leave, insurance benefits and a post-discharge recovery period. The
further support from the admin and HR teams were very helpful
and reflected the core value of EMIS supporting and caring for
employees.

I have also observed the support extended to employees affected
by Covid-19 over the last two years. My colleagues have been
supported with sick leave and offered a phased return to work,
which really helped aid a comfortable recovery.

I’ve been with EMIS for over three years and I’m very proud to be
part of a business that cares and prioritises its employees’ wellbeing.

EMIS Group plc | Annual report and accounts 2021

ESG report continued

Governance

Committed to good governance

Good governance is instrumental in how EMIS operates, whether this is
clinical safety of EMIS products, data governance to ensure patient records
are secure or corporate governance to ensure that the Group operates
effectively. Good governance requires effective leadership, having the right
culture and robust systems and processes in place so everyone knows what
to do and how to go about it in the right way. The corporate governance
statement can be found on pages 53 to 58 for further detail on how the
Group operates.

Diversity and inclusion
EMIS is committed to a diversity and inclusion agenda that influences every
part of the employee cycle, including recruitment and induction, ongoing
personal development and two-way employee engagement.

The Group aims to have at least 33% female representation on the
Board by the end of 2023 and 40% in the senior employee group by the
end of 2025.

In 2021 EMIS published data on its gender pay gap for 2020, showing a
mean gap of 6.4% for the Group (a 16% reduction from the previous year).
During 2021 there was a continued focus on reducing the gender pay gap
by identifying potential areas of disparity during reviews and by supporting
female candidates within recruitment campaigns for senior roles. Gender
pay gap data for 2021 has recently been calculated showing a slight
increase in the mean gap from the previous year to 7.6%, as a result of a
small number of senior female resignations which affected the statistics.
This data will be published in April 2022 in line with guidelines. Work
continues over time to further address the gender pay gap by reviewing
salaries at levels where a gap exists and seeking to ensure that EMIS is an
attractive employer to all, regardless of gender or background.

During the year EMIS undertook the first review of its ethnicity pay gap,
showing a mean gap of 17.5%, a reduction of 1.8% from the previous year.
Actions are underway to understand the detail behind the gap and the
Group has set a target to reduce it to 16% or below in 2022.

Embedding diversity and inclusion into EMIS culture
EMIS has had a strong focus on diversity and inclusion for a long time
and formalised this in 2020 with the creation of three diversity and
inclusion groups, chosen by employees. During 2021 the focus was
on education, celebration and development, with a number of specific
education events throughout the year on topics including Eid, Pride and
black history to celebrate diversity and the strength this brings to EMIS’s
culture. The groups are employee-led and supported by HR and the senior
leadership team.

To further increase diversity and inclusion, during 2021 the recruitment
team adopted a proactive search policy for applications from women
for roles in areas of the business where they are underrepresented. This
included use of a gender de-coder in recruitment adverts to identify and
remove gender-weighted language that could be an inadvertent deterrent
for applicants.

EMIS Group plc | Annual report and accounts 2021

Equal opportunities
EMIS strives to build an inclusive culture that encourages, supports and
celebrates the diverse voices of its employees. The Group is committed
to ensuring that its employees and prospective employees are treated
fairly and equitably. EMIS is focussed on providing a working environment
that operates on equality of opportunity and freedom from harassment
or unlawful discrimination on the grounds of race, sex, pregnancy and
maternity, marital or civil partnership status, gender reassignment, disability,
religion or beliefs, age, or sexual orientation; EMIS’s dignity at work policy
sets out this commitment. All employees are treated fairly and equally.

The Group treats applications for employment from disabled persons
equally with those of other applicants having regard to their ability,
experience and the requirements of the job. Where existing employees
become disabled, appropriate efforts are made to provide them with
continuing suitable work within the Group and to provide retraining
if necessary.

ESG committee
The committee was formed to provide a governance framework for the
implementation and oversight of ESG matters. It has 13 members from
across the Group and is led by the Group Chief Executive Officer of EMIS
Health and Enterprise, assisted by the Company Secretary. The committee
updates the Board to inform their regular discussions on ESG matters. The
Board will continue to monitor progress during the forthcoming year.

Clinical governance
Clinical safety is EMIS Group’s number one priority. The Group Chief
Medical Officer and a network of experienced working clinicians and
Clinical Safety Officers have overall responsibility for clinical safety at EMIS.
They work across the organisation and input into development, support
and product management processes to ensure clinical safety is embedded
in every part of the creation and delivery of healthcare technology. The
121-strong clinical team includes clinicians from a wide range of settings,
from primary care to A&E to community pharmacy, to bring real-life clinical
experience into the culture of the organisation and educate the rest of
the business on the reality of front line healthcare. The team ensures that
clinical governance is built into all new software developments by design,
right from the very beginning.

It’s a core part of EMIS culture that everyone has responsibility for clinical
governance. The business has an open communication policy when it
comes to sharing and escalating concerns. Employees are empowered
and encouraged to take ownership of EMIS’s high standards of clinical
governance at every level of the organisation.

The Group’s regulatory compliance team ensures that all software solutions
are compliant with relevant directives pertaining to medical devices,
enabling EMIS to safely bring innovative technology to the market such
as algorithms and AI.

Data governance
The Group has a responsibility to maintain the highest data governance
standards to securely look after the data it holds. EMIS ensures that its data
governance processes and policies are kept front of mind for all employees
through regular company updates and internal communications.

STRATEGIC REPORTGender diversity
Board

2929+

Female: 29%

GXT

2525+

Female: 25%

All employees

Senior leadership 3535+
3232+

Female: 35%

Female: 32%

Male: 71%

Male: 75%

Male: 68%

Male: 65%

EMIS’s data governance policy and set of overarching golden rules mandate
that anyone processing any personal data (patient, customer, consumer or
employee) must have relevant approval before they can proceed. During
2021 EMIS launched a new compliance hub, which provides monthly
prompts for regular mandatory governance training to all employees.
Management dashboards ensure that training is completed and 99% of
staff had completed their governance training by year-end.

Employees are empowered to know exactly what they should be doing,
with the right checks and balances in place, to drive the business forwards
within the governance framework.

The Group’s ISO 20001 accreditation provides external validation to
customers that EMIS’s processes and policies meet international standards.

Cyber security
Cyber security is a top priority to keep EMIS’s systems and data secure.
The Group has deployed new security and monitoring tools in response
to the fast evolving cyber threat landscape and has upskilled employees
by raising security awareness and promoting good security hygiene. The
Group will continue to invest in cyber defences in order to keep pace with
evolving threats and will adjust the security strategy and plans accordingly,
aligned to the business strategy.

Governance and risk management
EMIS Group has strong governance processes in place, overseen by the
Chief Financial Officer. The Group portfolio management office provides
governance of all key initiatives, to ensure that EMIS is investing in the
right strategic programmes and projects and is delivering them as efficiently
and effectively as possible. The operational executive team is a cross-
functional senior management group to ensure the business meets its
KPIs and delivers on key objectives. The RMC proactively manages and
mitigates risk across the business, with regular meetings and an action-
driven approach to reducing risk and maximising opportunities.

More information on how EMIS Group mitigates risk in the areas of data
and clinical security and the role of the RMC can be found on pages 32 to
37. Details on EMIS Group’s corporate governance and compliance with
the Code can be found on pages 52 to 58.

2022 priorities
The actions below will ensure the Group continues to uphold its
commitment to high standards of governance during 2022:

• Update the procurement and contracting process to include clear

measures that support the ESG strategy.

• Review recruitment processes to attract candidates from under-

represented groups.

• Review the current gender and ethnicity pay gaps and introduce

corrective measures.

The strategic report on pages 2 to 49 is signed on behalf of the Board.

Andy Thorburn
Chief Executive Officer
24 March 2022

Case study
What ESG means to me

Pankaj Mistry
Chief Information
Security Officer (CISO)

At EMIS we are serious about the responsibility of keeping patient
data safe. We deploy a range of technical and non-technical
measures to protect these valuable assets. This is embedded into
our culture.

Personally as CISO I am motivated to keep us safe from cyber
threats because it is important to safeguard the health of our
nation. By keeping the data safe and secure we can deliver the
services our clinicians rely on daily to care for their patients.

At EMIS we are proud that we have a progressive security
culture amongst staff, colleagues and our partners. Together
we continually work to improve everyone’s security awareness
through continued communication, education and training.

6Essential major ISO and National Cyber

Security Centre (NCSC CE+) accreditations

Our ambition:
continue commitment
to high standards of
governance in every area

EMIS Group plc | Annual report and accounts 2021

+
71
71
+
+
C
C
+
68
68
+
+
C
C
+
65
65
+
+
C
C
+
75
75
+
+
C
C

Board of Directors

Kevin Boyd
Senior Independent
Non-executive Director

APPOINTED
May 2014

BOARD COMMITTEES

SKILLS AND EXPERIENCE
Considerable senior management
and listed company experience.

Real-time financial experience and
software systems knowledge.

Experience of running complex
business and corporate
transactions.

Institute of Chartered Accountants
in England and Wales (Fellow).

Institution of Engineering and
Technology (Fellow).

EXTERNAL APPOINTMENTS

CURRENT
Non-executive director and audit
chair, Genuit Group plc.

Non-executive director,
Bodycote plc.

PREVIOUS
Group chief financial officer, Spirax-
Sarco Engineering plc, Oxford
Instruments plc and Radstone
Technology plc.

Patrick De Smedt
Non-executive Chair

Andy Thorburn
Chief Executive Officer

Peter Southby
Chief Financial Officer

APPOINTED
January 2020

APPOINTED
May 2017

APPOINTED
October 2012

BOARD COMMITTEES
None

SKILLS AND EXPERIENCE
Over 20 years’ experience in the
software industry in the UK and
internationally.

Ability to drive significant growth
in revenues and profitability for
companies through organic growth
as well as mergers and acquisitions.

SKILLS AND EXPERIENCE
Over 25 years’ experience in
finance, mainly in a public company
environment, with over half of this
at board level.

Strong track record in corporate
transactions, including fundraising,
acquisitions and disposals.

Track record in creating value in
software and communications
industries.

Detailed knowledge of strategy
across multiple industry sectors,
with a focus on support services.

Institute of Chartered Accountants
in England and Wales (Fellow).

EXTERNAL APPOINTMENTS

CURRENT
None.

PREVIOUS
Finance director at ENER-G plc
and Augean plc, senior financial
positions at White Young Green
plc and Leeds United plc having
trained with Arthur Andersen as
audit manager.

Over 30 years’ experience in
senior management and executive
positions.

EXTERNAL APPOINTMENTS

CURRENT
None.

PREVIOUS
Group chief operating officer of
Digicel Group, chief executive
officer of Digicel Caribbean and
Central America, chief executive
officer of Digicel Jamaica, chief
executive officer/president roles
at Intec Telecom Systems plc,
Chronicle Solutions Ltd and a
number of Benchmark Capital
Portfolio companies (including
Kalido Inc. and Orchestria Ltd) and a
managing director within BT Group.

BOARD COMMITTEES

SKILLS AND EXPERIENCE
International business experience
including a diverse portfolio of
main board-level appointments in
public and private equity-backed
companies varying in size up to
multi-billion pound turnover.

Entire executive career spent in
the software sector, primarily
with Microsoft, across a range of
largely general management roles
throughout Europe.

Experience in manufacturing,
construction, recruitment and
financial services sectors.

Expertise in driving innovation and
growth, bringing focus to customer
centricity and development of
successful go-to-market strategies.

EXTERNAL APPOINTMENTS

CURRENT
Senior independent director,
PageGroup plc.

Non-executive director and chair,
Nasstar Holdings Limited.

Non-executive director and chair,
Bytes Technology Group plc.

PREVIOUS
Chair of Microsoft Europe, Middle
East and Africa, vice president of
Microsoft Western Europe, general
manager (founder) of Microsoft
Benelux, non-executive director
of Kodak Alaris Holdings Ltd, non-
executive director and chair of the
remuneration committee of Victrex
plc, senior independent director
and chair of the remuneration
committee of Morgan Sindall
Group plc, senior independent
director and chair of the
remuneration committee of Anite
plc and non-executive interim chair
of KCOM Group plc.

EMIS Group plc | Annual report and accounts 2021

GOVERNANCEJen Byrne
Independent
Non-executive Director

JP Rangaswami
Independent
Non-executive Director

Denise Collis
Independent
Non-executive Director

APPOINTED
May 2019

APPOINTED
March 2021

APPOINTED
October 2021

BOARD COMMITTEES

SKILLS AND EXPERIENCE
Extensive commercial experience
in the global software sector.

SKILLS AND EXPERIENCE
Insightful, independent-minded
and a creative technology leader.

Strong track record in using
technical insight to deliver
challenging and technically
complex engineering programmes.

In-depth knowledge of finance and
engineering.

A strategic thinker with experience
of companies in a growth phase.

Strong leadership skills.

EXTERNAL APPOINTMENTS

CURRENT
Chief operating officer, G-Research.

Highly experienced in the data
analytics sector from both
operational and strategic data-
focussed, technology roles.

Specialist experience in data
governance, standards, best
practices and techniques.

Strong understanding of the
challenges of working in a
regulated environment.

EXTERNAL APPOINTMENTS

CURRENT
Non-executive director,
Allfunds Bank SAU.

Non-executive director, RUAG
Holding AG.

Non-executive director, Allfunds
Group plc.

PREVIOUS
23 years at the Lockheed
Martin Corporation. Latterly
as vice president, Space and
Missiles Systems.

Non-executive director, DMGT plc.

Non-executive director, Admiral
Group plc.

Non-executive director, National
Bank of Greece.

Trustee, Cumberland Lodge.

Trustee, Web Science Trust.

PREVIOUS
Chief data officer and group head
of innovation, Deutsche Bank,
chief scientist, Salesforce.com,
chief scientist, managing director
and chief information officer, BT
Group, head of alternative market
models and global chief information
officer, Dresdner Kleinwort, various
roles with multinational hardware,
software, services and consulting
organisations.

Board of Directors key

Executive

Non-executive

Committee membership

A Audit committee

N Nomination committee

R Remuneration committee

SKILLS AND EXPERIENCE
Breadth and depth of international,
senior executive and non-
executive director experience
across various sectors.

Expertise in all aspects of human
resources, including people
strategy, leadership, organisation
development, talent management,
recruitment, retention and reward.

Strong strategic perspective.

Chair of committee

Passionate advocate of the
criticality of the people agenda in
driving commercial success.

EXTERNAL APPOINTMENTS

CURRENT
Non-executive director, senior
independent director and chair
of the remuneration committee,
SThree plc.

Non-executive director and chair
of the remuneration committee,
Smiths News plc.

Chair of the remuneration and
people committee, British Heart
Foundation.

Fellow, Chartered Institute of
Personnel and Development.

PREVIOUS
Chief people officer, Bupa, group
HR director, 3i Group plc, partner
and head of HR for the UK, Middle
East and Africa, EY LLP, various HR
director roles across the financial
and business services industries,
vice chair, international advisory
board, Leeds University Business
School, advisory board member,
Exeter University Business School.

1 Appointed as Chair of the

remuneration committee in
October 2021.

EMIS Group plc | Annual report and accounts 2021

Chair’s introduction to governance

Good
corporate
governance

Dear Shareholder
On behalf of the Board I am pleased to present the EMIS Group plc
corporate governance report for the year ended 31 December 2021.

The Board recognises the value and importance of good corporate
governance and the framework in place underpins the Group’s ability
to achieve its strategic goals. Governance arrangements are reviewed
on an ongoing basis to ensure that they remain fit for purpose. As
the Group operates within the healthcare sector, it is particularly
important the focus remains on the safety and security of the Group’s
products as well as balancing the interests of all our stakeholders. As
an AIM-quoted company we have chosen to apply the UK Corporate
Governance Code 2018 (“the Code”) voluntarily as best practice.

The governance section of the 2021 annual report and accounts,
including the corporate governance statement, the audit committee
report, the nomination committee report and the Directors’
remuneration report, describes how the Group has applied the main
principles contained within the Code. Our statement of compliance,
required for AIM-quoted companies, can also be found on our website
at www.emisgroupplc.com/investors/corporate-governance.

Good corporate governance is important in achieving effective
leadership and sustainable corporate behaviour. It means ensuring that
there is an effective framework of internal controls, practices, policies
and systems that together define clear levels of accountability and
authority for decision making, enabling management to take appropriate
levels of risk within a culture of openness, ethics and values.

A good Board is formed of a diverse group of individuals, each
contributing different experiences, skills and backgrounds, which
enables independent and effective leadership. Inclusion and diversity
is a priority for us as a Board and for the wider company.

Patrick De Smedt
Chair
24 March 2022

COMPLIANCE STATEMENT
This corporate governance statement has
been prepared in accordance with the
principles of the “Code”. During the year, the
Group was compliant with the Code except
for Provision 38 – pension alignment and
Provision 41 – employee engagement to
explain how executive remuneration aligns
with the wider company pay policy, which
are explained in more detail on page 53.

1. Board leadership and

company purpose

• Led by strong and experienced Chair

• Alignment of purpose, strategy
and values with Group culture

• Effective engagement

with stakeholders

Read more on page 58

EMIS Group plc | Annual report and accounts 2021

Corporate governance statement continued

STANDING AGENDA ITEMS

At each meeting comprehensive Board packs are provided and
the following standing items are discussed:

• Strategy;

• Financial results and KPIs;

• Sales pipeline and forecasts;

• Regular presentations from members of the Group executive

team (GXT);

• Progress reports on major projects;

• Analysts’ forecasts;

• Board committee updates;

• Management accounts and commentary;

• Investor relations engagement;

• Reports from the Chief Executive Officer on operational
matters and the Chief Financial Officer on financial matters;

• Legal, governance and regulatory matters; and

• Implementation of actions agreed at previous meetings.

• Mergers and acquisitions;

KEY TOPICS CONSIDERED BY THE BOARD IN 2021

Financial

• Financial results announcements, presentations, report and accounts and market

updates (annual and half year).

• Banking facilities.

• 2022 Group budget.

• The Group’s viability statement and capital allocation policy, including dividends.

Strategic

• Review, debate and challenge of the corporate strategy and plan.

• ESG matters.

• Review and consideration given to M&A targets and approval of the acquisition

of Edenbridge Healthcare Limited.

Governance

• Approval of appointment of Denise Collis.

• Employee engagement and culture.

• Risk management and internal controls.

• Investor engagement.

• Board evaluation.

Operational

• Presentations on product roadmap, information security, EMIS-X Analytics,

service performance and customer service satisfaction strategy.

• Group operating model.

• Management information and KPIs.

• Operational efficiency, including service level reporting.

• Group restructuring.

• Examined the output and associated management action plans regarding an

external cyber security review performed by Deloitte LLP.

EMIS Group plc | Annual report and accounts 2021

GOVERNANCEBoard leadership and Company purpose
Role of the Board
The Board’s principal role is to provide effective leadership of the
Group and establish and align the Group’s purpose, strategy, values and
culture. It is responsible to shareholders for delivering shareholder value
by developing the overall strategy and supporting the development
of the direction of the Group. The Board is also responsible for
overseeing the Group’s external financial and other reporting and for
ensuring that appropriate risk management and internal control systems
are implemented and maintained. These responsibilities are largely
exercised through the audit committee, which reports on its activities
on pages 59 to 63.

The business model on pages 10 and 11 explains the basis on which
the Group generates and preserves value over the longer term. The
strategy of the Group and its achievements in 2021 are outlined on
pages 18 to 19.

The Board recognises the importance of establishing the right culture
and communicating this message throughout the organisation. For more
information on the Group’s culture see page 46. It is important that
the Board provides strong and effective leadership and constructive
challenge and, along with the GXT, the Board accepts collective
accountability for the long-term sustainable success of the Group. In
so doing, the Board will continue to drive and deliver its strategy in the
best interests of all the Group’s stakeholders.

Board operation
The Board meets as often as necessary to discharge its duties.

The number of Board meetings held during 2021, together with the
Directors’ attendance records, is set out on page 53. Details on the
number of committee meetings held during the year, together with the
Directors’ attendance records, can be found in the committee reports
on pages 59, 64 and 66. Historically, the location for Board meetings
was rotated around the Group’s principal sites, providing opportunities
for the Board to meet management and employees and develop a
better understanding of the Group’s operations and culture. The
majority of meetings in 2021 were conducted remotely because of the
pandemic but going forward, the Board will adopt a hybrid approach
taking protective measures and environmental issues into account.
Employee engagement remains a priority for the Board as outlined
on page 46.

The Directors have access to the advice and services of the Company
Secretary, Christine Benson, who is responsible for ensuring that
the Board and its committees’ procedures and applicable rules and
regulations are met. The Directors all have access to the Group’s key
advisers. If required in the performance of their duties, Directors
may take independent professional advice at the Company’s expense.
Appropriate insurance cover is in place in respect of legal action against
the Directors. The Group has adopted and maintained a share dealing
code for Directors and employees in accordance with the Market
Abuse Regulations.

Board and committee papers are circulated one week in advance
of meetings to enable the Board to review and consider the
materials provided.

The Chair ensures that input is sought and obtained from any Director
who is unable to attend a Board meeting and he provides a verbal
update following the meeting to complement the minutes. There is
ongoing contact between the Chair, Executive Directors and Non-
executive Directors between Board meetings.

A topical Board calendar is prepared on an annual basis with senior
leadership members regularly invited to present an update on their
areas of the business. This is highly valuable in providing further detail
to support strategic decisions. In addition, the Board meets on an ad
hoc basis as necessary to consider specific issues, such as potential
corporate activity, supported by detailed Board papers circulated in
advance analysing relevant aspects of the topic under discussion.

TENURE (BOARD)

0–3 years: 4

4–6 years: 1

7+ years: 2

57+57+

Stakeholder engagement
The Board recognises its responsibility to take into consideration the
needs and concerns of the Group’s stakeholders as it discusses matters
and makes decisions.

Relations with shareholders
Communication between the Group and its shareholders is an essential
element of a sound governance framework.

The Chief Executive Officer and Chief Financial Officer are the main
day-to-day point of engagement with shareholders and prospective
investors. During the year, formal programmes of meetings with
analysts and institutional shareholders took place immediately after the
results announcements, supplemented by ad hoc meetings and calls at
other times.

Feedback from these meetings, and regular market updates prepared
by the Group’s broker, are presented to the Board to ensure the
Directors have a good understanding of shareholders’ views. The Chair
and the Senior Independent Director are also available separately to
shareholders to discuss strategy and governance issues. Feedback
from any such communications is provided to the Board at the next
scheduled meeting. The Chair and Chair of the remuneration committee
consulted with a number of shareholders in 2021 to seek views on
strategy and remuneration matters. A number of shareholders were also
interviewed as part of the materiality assessment on environmental,
social and governance (ESG) priorities.

The Group has a dedicated investors section on its website,
www.emisgroupplc.com/investors, together with a wide
range of information on the Group’s activities, including all
regulatory announcements.

The Annual General Meeting (AGM) will be held at 9.00 am on
Thursday 5 May 2022 at the offices of Pinsent Masons, 1 Park Row,
Leeds LS1 5AB. The notice of the AGM is available on the Group’s
website and sets out the business of the meeting and an explanatory
note. In line with good governance, voting on all resolutions at this
year’s AGM will be conducted by way of a poll.

EMIS Group plc | Annual report and accounts 2021

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Corporate governance statement continued

The Board delegates certain responsibilities to the three principal Board
committees: the audit committee, the remuneration committee and the
nomination committee. These responsibilities are set out in formal terms
of reference for each committee, which are available on the Group’s
website, www.emisgroupplc.com/investors/corporate-governance, and
which are reviewed annually.

The Chair of each committee reports to the Board in relation to the
committee’s activities and recommendations. Members of the Board
who are not members of individual committees may be invited to
attend meetings of those committees at the discretion of the respective
committee’s Chair; however, they are not permitted to vote in respect
of committee business.

BOARD GENDER

Male: 71%

Female: 29%

7171+

Chair
The roles of the Chair and the Chief Executive Officer are separate
and defined in writing. This provides a clear division of responsibilities
between the running of the Board and the executive responsibility for
running the business. The key responsibilities of the Chair, the Chief
Executive Officer and Non-executive Directors are set out below:

Patrick De Smedt, as Chair, is responsible for the leadership and
effectiveness of the Board.

The Chair’s responsibilities include:

• Chairing the Board, the nomination committee and shareholder

meetings (including the AGM);

• Providing leadership of the Board and ensuring the effectiveness

of all aspects of the Board’s role;

• Offering challenge to the Executive Directors and working closely

with the Chief Executive Officer on key strategic decisions;

• Maintaining a dialogue with major shareholders on governance

and other strategic matters, as appropriate;

• Setting the Board agenda and ensuring all Directors have the
opportunity to maximise their contribution to the Board by
encouraging open and honest debate and constructive challenge
of the Executive Directors; and

• Undertaking the annual evaluation of the Board and the Directors

and building an effective Board.

On his appointment, Patrick De Smedt met the Code’s requirement
for independence. There have been no significant changes to his other
commitments during the year which could impact his ability to perform
his duties for the Group.

Board leadership and Company purpose continued
Workforce engagement
Local and national employee forums continued to operate throughout
2021 with colleagues encouraged to share their views and ideas.
Regular updates on engagement are provided to the Board. Jen Byrne
was the designated Non-executive Director during the year and
attended the national forums, providing updates to the Board. In 2021,
the network was extended further with an employee forum set up in
India representing employees based in Chennai.

The employee forums continue to be an important channel of
communication, with a focus on listening to and learning from employee
feedback. The forums also provide a sounding board for new ideas
and initiatives, ensuring that the business hears and acts on employee
insights and viewpoints.

From 2022 the UK local forums will merge into one national forum,
with employees representing each part of the business rather than
geographic locations. This new approach reflects both the matrix
structure of the Group as well as the new hybrid way of working
between home and the EMIS collaboration hubs.

The Group’s engagement strategy will be reviewed in early 2022,
moving away from a designated Non-executive Director role. Further
information on the new approach will be disclosed in the 2022 report.

Further information on workforce engagement can be found in the
ESG report on page 46 and more detail on how the Group has engaged
with its various different stakeholders can be found in the stakeholder
engagement section on pages 12 and 15.

Whistleblowing
A whistleblowing policy is in place where employees can raise concerns
to an independent organisation on a confidential basis. Reports on the
use of the service, any significant concerns that have been received,
details of investigations carried out and any actions arising as a result
are reported to the audit committee on a regular basis. No material
issues were raised during the year.

Conflicts of interest
Directors have a legal duty to avoid conflicts of interest. Prior to
appointment, conflicts of interest are disclosed and assessed to ensure
that there are no matters which would prevent that person from taking
on the appointment. If any potential conflict arises subsequently, the
Articles of Association permit the Board to authorise the conflict,
subject to such conditions or limitations as the Board may determine.
In situations where a potential conflict arises, the Director concerned
will not be permitted to remain present in any meeting or discussion
concerning that conflict, and all material in relation to that matter will
be restricted, including Board papers and minutes.

Division of responsibilities
Board structure
JP Rangaswami was appointed to the Board on 1 March 2021 as a
Non-executive Director. Denise Collis was appointed to the Board
on 1 October 2021 as a Non-executive Director and as Chair of the
remuneration committee, taking over the role from Andy McKeon
who retired from the Board on 28 February 2022. Biographies of each
Director are provided on pages 50 and 51. Their respective Board and
committee responsibilities are outlined below and in the committee reports.

Appointments to the Board are led by the nomination committee.
Further information on succession planning can be found in the
nomination committee’s report on pages 64 and 65.

EMIS Group plc | Annual report and accounts 2021

GOVERNANCE+
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Chief Executive Officer
The Chief Executive Officer, Andy Thorburn, is responsible for the
implementation of the approved strategic and financial objectives of
the Group. To assist in this, the Chief Executive Officer leads the GXT,
which consists of the Chief Financial Officer, the Group Chief Operating
Officer, the Chief Executive Officer of EMIS Health and Enterprise, the
Group HR Director, the Group Chief Medical Officer, the Group Chief
Technology Officer and the Group Business Development Director.
The GXT has a monthly call with a focus on cross-group integration
and operational performance. Beneath the GXT is the operational
executive team and during 2021 members of the team met regularly to
discuss and collaborate on important operational matters arising that
week. This included status updates on priority projects and product
enhancements, material sales and delivery issues and opportunities,
and key people changes. In addition, monthly business reviews
were held to discuss performance across all key areas of the Group
ensuring everyone was up to date and able to prioritise effectively
based on a thorough understanding of the interdependencies and
risks between areas. This open and collaborative forum contributed
to our success in 2021.

The Chief Executive Officer’s responsibilities include:

• Day-to-day running of the business, accountable to the Board

for the Group’s financial and operational performance;

• Developing and reviewing the Group strategy;

• With the Chief Financial Officer, maintaining close contact with

the UK government, shareholders and major customers;

• With the Chief Financial Officer, approving the divisional budgets;

• Chairing the GXT to direct and co-ordinate the management of

the Group’s business generally;

• Monitoring the performance of senior managers; and

• Monitoring the Group’s principal risks.

Senior Independent Director
The Senior Independent Director acts as a sounding board for the
other Directors and conducts the Chair’s annual evaluation. He is also
available to Directors and shareholders should a situation arise where
it is necessary for concerns to be referred to the Board other than
through the Chair or the Chief Executive Officer. Andy McKeon was
the Senior Independent Director during 2021 but retired from the
Board on 28 February 2022, having served nine years. Kevin Boyd
took on the role of Senior Independent Director upon Andy McKeon’s
retirement.

Non-executive Directors
The Non-executive Directors provide independent, constructive
challenge and insight to the executive team forming an integral part
of the Board’s decision-making process together with the monitoring
of management and business performance.

The Non-executive Directors play a key role in developing and
reviewing proposals on strategy, actively participating in the annual
strategy forum. They strengthen governance through leading and
participating in the Board committees, providing a wide range of
experience and independence. This aids the Board in developing a
broader understanding and in evaluating the implications, risks and
consequences of decisions.

14+14+

BOARD – EXECUTIVE/
NON-EXECUTIVE
MEMBERSHIP

Chair – Non-executive: 1

Executive Directors: 2

Non-executive Directors: 4

Independence
Patrick De Smedt, Kevin Boyd, Jen Byrne, JP Rangaswami and Denise
Collis were considered by the Board to be independent at the time
of their appointments. Each Non-executive Director is considered
to be independent as to character and judgement and to be free
of relationships and other circumstances that might impact their
independence. The Chair and Non-executive Directors meet at least
annually without the Executive Directors present.

Appointments of Non-executive Directors are for specific terms
(initially for three years) and are subject to statutory provisions relating
to the removal of a Director.

Time commitments
The amount of time that Non-executive Directors are expected to
commit to discharge their duties is agreed on an individual basis at the
time of appointment and reviewed periodically thereafter. The time
commitment agreed takes into account whether the appointee is the
Chair or a member of a Board committee and whether the Director has
any external executive responsibilities. Typically this equates to circa
two days per month for a Non-executive Director and four days per
month for the Chair. As part of the Chair’s annual review of Directors’
performance it was confirmed that each of the Non-executive Directors
continues to allocate sufficient time to discharge responsibilities
effectively and did so throughout the year.

Composition, succession and evaluation
Nomination committee and diversity
The nomination committee is responsible for leading the Board
appointments process and for considering the size, structure and
composition of the Board. Full details of the work of the committee are
set out in the nomination committee report on pages 64 and 65.

The Board is satisfied that the size of the Board and its committees
and the balance of Executive and Non-executive members is such
that no individual or small group of individuals can unduly influence
its decisions. The Board is made up of a majority of independent
Non-executive Directors. As at the date of this report, the Board
comprised the Chair, four independent Non-executive Directors and
two Executive Directors who collectively possess an appropriate
balance of expertise appropriate to lead the Group’s business. The
Non-executive Directors have a broad range of UK and international
business knowledge and experience, as well as specific skills in the
areas of the NHS, healthcare, digital technology, finance, corporate
transactions and risk management.

The Executive Directors do not hold any external directorships.

EMIS Group plc | Annual report and accounts 2021

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Corporate governance statement continued

Composition, succession and evaluation continued
Annual re-election of Directors
Directors are subject to election or re-election by shareholders at
each AGM. The nomination committee considers that all the Directors
continue to be effective and demonstrate an appropriate commitment
to their roles. As Denise Collis joined the Board on 1 October 2021,
she will stand for election at the AGM on 5 May 2022.

Appointment and induction
The process for the appointment of new Directors is rigorous and
transparent. All new Directors undergo a comprehensive induction
and development programme which is designed to help Directors
to contribute effectively to the Board as quickly as possible. Further
information on appointments and induction is contained in the report
of the nomination committee on pages 64 and 65.

Audit, risk and internal control
Audit, risk and internal control are addressed separately in the principal
risks and uncertainties on pages 32 to 37 and in the report of the audit
committee on pages 59 to 63.

Remuneration
Remuneration is addressed separately in the report of the remuneration
committee and the Directors’ remuneration report on pages 66 to 81.

Christine Benson
Company Secretary
24 March 2022

Board and committee effectiveness
The Board has extensive operational experience and many years
of detailed knowledge of the healthcare sector, both in the UK
and overseas. The Board also benefits from significant financial,
transactional, risk management and public company expertise.

When considering Board appointments, a wide variety of factors
is taken into account, including the balance of skills, experience,
independence, knowledge of the Group and diversity, including gender.

The 2021 Board evaluation was conducted by way of an internal
evaluation. A tailored questionnaire was circulated for completion by
members and regular attendees of the board and of each principal
committee, covering all aspects of good governance. Directors were
required to assess their satisfaction with the operation of the Board
and its committees, as well as effectiveness of these bodies in fulfilling
the key responsibilities set out in their respective terms of reference.
The findings of the evaluation were discussed by the Board and it was
concluded that the Board meets its regulatory requirements and that
appropriate processes are in place for setting the strategic direction of
the Group. Board discussions are open and constructive, and members
are encouraged to express their views in an independent fashion.

Each committee also concluded that it continued to be effective
and all members are considered to have made valuable contributions.

Further details of the effectiveness of each committee are outlined
in their individual reports.

EMIS Group plc | Annual report and accounts 2021

GOVERNANCEReport of the audit committee

2021 MEMBERSHIP AND ATTENDANCE

Number of meetings

Oversight of
the financial
reporting
process

Dear Shareholder
I am pleased to present the report of the audit committee
for the financial year ended 31 December 2021.

The audit committee provided oversight of the financial
reporting process to ensure that the information provided
to the shareholders is fair, balanced and understandable
and allows accurate assessment of the Group’s position,
performance, business model and strategy.

During the year the committee also continued to oversee
the risk management and internal control systems and
was satisfied that the controls over the accuracy and
consistency of information presented are robust.

Kevin Boyd (Chair)

Andy McKeon

Jen Byrne

JP Rangaswami1

Denise Collis2

Andy McKeon3

Attended

Not attended

1 JP Rangaswami became a member of the committee from the date of his

appointment to the Board on 1 March 2021.

2 Denise Collis became a member of the committee from the date of her

appointment to the Board on 1 October 2021.

3 Andy McKeon retired from the Board on 28 February 2022.

• Other regular attendees by invitation are the Chair of the Board,
Chief Executive Officer, Chief Financial Officer, Group Finance
Directors, Director of Group Risk and Internal Audit, Head of
Internal Audit, representatives from KPMG (external auditor)
and the Company Secretary.

• The committee meets at least four times a year; it met four

times in 2021.

• All committee members were considered independent upon

their appointment.

• Kevin Boyd is considered to have recent and relevant financial

experience.

• The committee as a whole has significant experience relevant

to the industry sector the Group operates in.

• The committee Chair provided a verbal update to the Board

following each committee meeting.

KEY RESPONSIBILITIES
The committee reviews its terms of reference annually. These
describe the committee’s responsibilities in detail and they are
available on the Group’s website.

The committee assists the Board in meeting its responsibilities
relating to financial reporting and internal control and risk
management. It provides oversight and ensures that formal and
transparent arrangements are in place in the following areas:

• Financial reporting, which includes responsibility for reviewing

the year-end and half year financial reports;

• Oversight of the external audit process and management of the

relationship with the Group’s external auditor;

• Risk management and related controls and compliance;

• Internal audit, including monitoring of the Group’s internal audit

function, its processes and findings; and

• Provision of whistleblowing facilities and prevention of bribery

and other types of fraud and corruption.

The committee acknowledges and embraces its role in protecting
the interests of shareholders. It also considers the interests of
other stakeholders and it is committed to monitoring the integrity
of the Group’s reporting.

EMIS Group plc | Annual report and accounts 2021

GOVERNANCE

Report of the audit committee continued

KEY ACTIVITIES IN 2021

Financial reporting

• Reviewed the full year results including the annual report and accounts, the
preliminary results announcement and the report from the external auditor.

• Reviewed the half year results statement.

• Provided assurance to the Board that the annual report and accounts is fair,

balanced and understandable.

• Reviewed the going concern assumption when considering the half year
and final results statement and also considered longer-term viability.

• Considered the appropriateness of accounting policies, critical accounting

judgements and key sources of estimation of uncertainty.

External audit

• Reviewed and approved the 2021 audit plan and strategy including fees.

• Assessed the effectiveness of the external audit process.

• Agreed the appropriateness of remuneration in respect of audit and non-

audit services.

Internal audit

• Reviewed the key findings from internal audit reports conducted during 2021

and management’s progress in addressing internal audit findings.

• Monitored progress against the 2021 approved internal audit plan.

• Reviewed and approved the scope and areas of focus for the two-year internal audit

plan covering 2022 and 2023.

• Reviewed and approved additional resource to further strengthen the internal

audit team.

Risk and internal control

• Monitored and assessed the Group’s risk management process.

• Approved the Group’s risk appetite.

• Monitored developments in the Group’s risk management processes by reviewing
outputs from the fortnightly risk management committee (RMC) meetings and
reviewing risk KPIs.

• Assisted the Board in its assessment of the Group’s principal risks, emerging
risks and its review of the effectiveness of risk management and internal
control processes.

• Reviewed the results of the Group’s control and risk self-assessment process.

• Ensured information security updates were reviewed regularly by the Board.

• Received regular progress reports from senior management in respect of key

internal projects, including the Group’s ERP replacement project.

• Monitored and reviewed the effectiveness of the Group’s internal audit

and finance functions.

• Reviewed the Group’s whistleblowing arrangements, confirming that they are

operating effectively.

• Monitored training and policy acceptance results for key governance policies,

including anti-bribery and corruption.

• Reviewed and approved the Group’s treasury policy.

• Reviewed the committee’s terms of reference.

• Reviewed the outputs from the committee evaluation.

Other matters

EMIS Group plc | Annual report and accounts 2021

Composition and governance
JP Rangaswami and Denise Collis were appointed as Non-executive
Directors and members of the committee on 1 March and 1 October
2021 respectively. The Board evaluates committee membership on an
annual basis. Biographical details of the Directors are set out on pages
50 and 51.

The Board believes that the current members have sufficient skills,
qualifications and experience to discharge their duties in accordance with
the committee’s terms of reference and that collectively as a committee
the members have an appropriately deep understanding of the sector
within which the Group operates.

All Board members attend each committee meeting. The committee
meets with KPMG at least twice a year without Executive management
present, to discuss matters relating to its remit and any issues relating
to the audit. I also meet regularly with the Chief Financial Officer, the
Director of Risk and Internal Audit and the lead KPMG partner outside the
formal meetings to ensure that any areas for discussion are dealt with on
a timely basis.

estimation. The committee has reviewed the future forecasts, including
specific consideration of the key assumptions and is satisfied that these
are reasonable, and that the carrying value of the Group’s goodwill is
supportable.

Another source of estimation uncertainty is in respect of capitalised
development costs. The committee is updated at least twice a year on
the carrying value, including detail on projects underway and projects
completed. The committee is satisfied that an asset is only recognised
when the criteria of IAS 38 are met, including the demonstration of
technical feasibility, the existence of a market and the availability of
resources to complete the project. Based on their knowledge of the
products, and the markets in which EMIS Group operates, the committee
is in agreement with the estimates of Useful Economic Life (UEL) over
which capitalised development expenditure is amortised. The UEL is
different for each unique product and reviewed every six months for
appropriateness. Amortisation is accelerated if there is no longer a market
for the product.

Further details are set out in note 2 to the accounts.

Committee evaluation
The audit committee undertakes an annual evaluation of its performance
and effectiveness. For 2021 an internal evaluation was carried out by
way of a questionnaire which was circulated for completion by members
and regular attendees. The findings were discussed by the committee
and it was concluded that the committee had performed effectively and
that the skills and experience of the members remained relevant. No
significant areas of concern were highlighted during this review although it
was agreed that a number of improvements could be made, including the
provision of greater clarity on different sources of assurance, particularly
in looking ahead to likely future corporate governance changes.

Financial reporting
During the year, the committee reviewed the full year results including
the annual report and accounts, the preliminary results announcement
and the report from the external auditor. In reviewing the statements
and determining whether they were fair, balanced and understandable,
the committee considered the work and recommendations of
management as well as the report from the external auditor.
The committee also reviewed the half year results statement.

The committee considered the appropriateness of accounting policies,
critical accounting judgements and sources of estimation uncertainty.
To do this, the committee reviewed information provided by the Chief
Financial Officer and reports from the external auditor setting out
its views on the accounting treatments and judgements in the 2021
financial statements. In preparing the 2021 financial statements, no
judgements have been made in the process of applying the Group’s
accounting policies, other than those involving estimations, that could
have a material effect on the amounts recognised in the financial
statements. These estimations are detailed below.

Sources of estimation uncertainty
In applying the Group’s accounting policies, various estimates are made in
arriving at the amounts recognised in the financial statements.

A key source of estimation uncertainty that has a significant risk of
resulting in a material change to the carrying value of assets within
the next financial year arises in respect of goodwill within the Acute
Medicines Management CGU. The carrying value of goodwill is
determined with reference to forecast future cashflows which are
sensitive to certain key assumptions, each requiring a significant level of

Going concern
The committee reviewed papers from management on going concern
assumptions when considering half year and final results statements
and on long-term viability when considering the final results statement.
Internal financial projections and the results of stress testing the financial
models were taken into account.

As part of its review, the committee took into consideration updates
provided on the Group’s principal and emerging risks.

External audit
In accordance with its terms of reference, the committee annually
reviews the audit requirements of the Group and the effectiveness and
independence of the incumbent external auditor prior to any decision
to reappoint.

The committee meets regularly with the external auditor, both with and
without management present.

The committee is responsible for ensuring that the independence of the
Group’s external auditor is not compromised or put at risk of compromise.
The committee reviews, challenges and approves both the annual audit
plan and output from the audit process as part of assessing the auditor’s
expertise and performance.

External auditor effectiveness review
The auditor is considered to be effective in the performance of its duties.
The committee uses an annual questionnaire-based approach to gather
the opinions of Directors and senior management, with findings (and areas
for improvement) shared with the auditor. The external auditor regularly
provides information relevant to assuring us about its own independence,
objectivity and compliance with regulatory and ethical standards.

Provision of non-audit services by the external auditor
The audit committee monitors the nature and extent of non-audit services
provided by the external auditor. The committee is consulted prior to
engagement of the external auditor for non-audit work and formally
approves all non-audit services. Consideration is given to any perceived
threat to independence prior to the procurement of non-audit services
from the external auditor, with other external advisers used where appropriate.

EMIS Group plc | Annual report and accounts 2021

Report of the audit committee continued

External auditor effectiveness review

Qualification
and expertise

Independence
and objectivity

Planning and
organisation

Resources

Non-audit
services review

Quality

The committee considers that the
external auditor has appropriate
resources and expertise to conduct
the audit.

Non-audit services provided by
KPMG were reviewed and are not
considered to have affected the
auditor’s independence.

The committee considered there
to be an effective audit planning
process in place.

The committee also considered the
quality of external auditor reporting
(including recommendations) to be
appropriate.

A summary of fees paid to KPMG for audit and non-audit services
during the year ended 31 December 2021 is provided in note 6 to the
financial statements on page 104. Fees for non-audit services continue
to be considerably below the 70% cap of the average audit fees for
the preceding three-year period as required by regulated EU audit
legislation.

The Director of Group Risk and Internal Audit maintains independence
through direct access to me, without the need to refer to Executive
management. He attends audit committee meetings by invitation and
regularly reports to the committee on internal audit, risk management and
corporate governance matters. The committee and I periodically meet
with him without management being present.

Internal audit
EMIS Group operates an in-house internal audit function, co-sourced
with an external audit services provider, which objectively reviews the
Group’s internal control processes in accordance with the Audit Charter.
The Charter was reviewed and approved by the committee in 2018 and
it remained in place and relevant in 2021.

The committee previously approved a three-year risk-based audit plan
to run from 2019 through to 2021. The final year of this plan covering
2021 was reviewed, amended as required and approved during the year.
A shorter two-year internal audit plan covering 2022 and 2023 has been
formulated utilising input from the Board and committee members, the
Group’s external auditor, internal audit co-source partner and using output
from the risk management process. The plan remains flexible and includes
time for ad hoc investigations and other high-risk assurance work as it
arises and as agreed by the committee. The audit plan for 2022 includes
key risk areas such as cyber security, business continuity planning, change
management, clinical safety, talent retention, cloud security, software
development and ESG focus areas along with a range of financial risk areas
such as procurement and month-end reporting at all locations across the
Group including India.

Internal audit’s resources are reviewed regularly, and the current
combination of internal resources (which were increased during the year)
and a co-sourced internal audit agreement with Deloitte was felt to be
appropriate and sufficient to obtain adequate assurance over the Group’s
internal controls and key risks. The co-source arrangement ensures
enhanced audit coverage of technical and specialist areas, such as clinical
safety, data governance and cyber security.

During 2020, the Group introduced a control and risk self-assessment
process to further embed awareness and responsibility for control and
risk within the business. This annual assessment covers key business areas
across the Group including functions such as finance, human resources,
clinical safety, software development and support operations. The results
of the second assessment were reported to the committee in December
2021. This showed improvement across the Group and a plan of action
for continuous improvement was approved, supported by internal audit
reviews continuing in 2022.

EMIS Group plc | Annual report and accounts 2021

Risk management
The committee is responsible for monitoring and developing the
effectiveness of risk management and internal control systems on
behalf of the Board.

The Group has a Board-approved risk management policy and operates
a structured risk management process with oversight from the RMC,
which meets regularly and is chaired by the Chief Financial Officer.
The committee reviews action plans and output from RMC meetings.

During the year, the committee continued to monitor the Group’s risk
appetite, which remains unchanged.

The committee reviewed the Group’s principal risks to ensure they are
being adequately captured and reported to the Board and that the risk
disclosures in the annual report and accounts are appropriate. The RMC
is the recognised forum for identifying, assessing and reporting on any
significant emerging risks facing the Group. Emerging risks are defined as
particularly uncertain and difficult to quantify but have the potential to
become more significant over time. They usually have longer expected
timelines than principal risks, or other risks detailed in the risk registers,
and the potential impact can increase quickly.

For full details of the risk management process, principal risks and risk
appetite statements of the Group, see pages 32 to 37.

Internal control effectiveness
On behalf of the Board, the committee reviews the Group’s internal
control arrangements through policies and seeking assurance on the
design and effective operation of internal controls. Such arrangements
guide and direct the activities of the Group to support delivery of its
strategic, financial, operational and other objectives and to safeguard
shareholders’ investment and the Group’s assets. The Board recognises
that a system of internal control reduces, but cannot eliminate, the
likelihood and impact of poor judgement in decision making, human error,
deliberate circumvention of control processes by employees and others,
management override of controls and the occurrence of unforeseeable
circumstances. The Board sets policies and seeks and obtains on an

GOVERNANCEAuditor rotation timeline
The Company is excluded from the provisions of the retained EU Audit Directive and Regulation on the grounds that it is an AIM-quoted
company. However, we aim to voluntarily meet the regulatory requirements as a matter of good practice. KPMG has been the Group’s
external auditor since 2013, with the current partner, Fran Simpson, appointed in 2018. Under the EU Audit Directive and Regulation, the
Company would not be required to put the external audit out to tender until 2023.

2013
KPMG appointed

2018
Partner rotation –
Fran Simpson took over

2023
Competitive tender unless specific
circumstances require an earlier tender

ongoing basis, both directly and through the audit committee, assurance
regarding the existence and operation of appropriate internal controls to
mitigate key strategic, financial, operational, compliance and reputational
risks. Any significant matters raised in reports from management, the
external auditor or the Director of Group Risk and Internal Audit are
escalated to the committee and subsequently the Board, both of which
monitor the progress of remedial actions.

The committee is satisfied that appropriate actions have been taken to
remedy any significant weaknesses or failures identified as a result of
these or other review processes and has reported such to the Board.

The key components of the Group’s overall control frameworks, all of
which effectively remained in place throughout 2021 and up to the date
of approval of this report, are set out below.

• Delegated limits of authority in place;

• An appropriate finance function across the Group with suitably qualified

and experienced professionals;

• A comprehensive weekly and monthly financial and operational

performance reporting system which covers, amongst other things,
operating results, cash flow, balance sheet information, forecasts and
comparisons against budgets;

• Letters of representation signed by all senior management and senior

Group finance officers in respect of key risks, internal controls, business
relationships and financial controls for the financial year under review;

• A control and risk self-assessment process, which provides a mechanism
for management to assess compliance with key controls across various
business areas and against which Group internal audit independently
validate management’s assessment;

• Appropriate project management frameworks including the Group

project management office and associated investment committee to
manage change and validate key investment decisions;

• A comprehensive suite of policies and procedures along with monitoring
of mandatory training and policy acknowledgement across key areas
such as ethics, data governance, IT security, whistleblowing and anti-
bribery and corruption;

• The RMC meets regularly to review and monitor risk and mitigating

controls across the Group; and

• Regular updates to the Board from management on property, insurance,
litigation, human resources, corporate social responsibility and health
and safety matters.

Segregation of duties, authorisation limits and other key internal controls
are designed into both system-based and manual processes. These
arrangements are reviewed periodically by management, internal quality
assurance functions and internal audit to ensure they remain appropriate.

The Group has extensive internal quality assurance processes in
critical areas of the business and there are functions within the Group
that provide assurance and advice covering specialist areas, such as
information security and clinical safety.

In addition, the Group’s businesses hold eight ISO certifications against
the following five standards: ISO 27001: Information Security, ISO 9001:
Quality, ISO 20000: Service Management, ISO 14001: Environmental and

ISO 22301: Business Continuity. A single management system covers all
five standards and five of the eight certifications.

Throughout 2021, the Group maintained the ISO certifications both in
the UK and India. The Group continues to review and make improvements
to the implementation of these standards. In addition, the Group also
maintained the Cyber Essentials Plus certification during 2021.

In 2022, the Group plans to consolidate and update the ISO certifications,
including bringing Pinnacle and Community Pharmacy under the scope of
the EMIS Group ISO 27001 certification and Community Pharmacy under
the scope of EMIS Group ISO 9001 certification.

Other matters
The programme to define, create and embed Group-wide policies in key
areas continued throughout 2021 and a number of these are available on
the Group’s website.

The Group whistleblowing procedures include a confidential reporting
hotline operated by an external, independent whistleblowing service
provider. The policy and the reporting hotline continue to be internally
promoted and all employees were required to acknowledge that they have
read and understood the policy and procedures in place during the year.
The results of these along with all other mandatory training and policy
acknowledgement have been reviewed by the committee regularly.

The committee’s action plan for 2022
Looking ahead to 2022, the committee’s focus will remain on the key audit
and assurance areas of the business, and on its oversight of financial and
other regulatory requirements. The action plan for 2022 will focus on:

• Reviewing and making recommendations in relation to the statutory,

preliminary and half year financial results;

• Overseeing key financial policies and practices;

• Assessing the effectiveness of the internal audit function and

monitoring its annual plan;

• Reviewing corporate governance policy and procedure including the

whistleblowing and anti-bribery and corruption policies and procedures;

• Undertaking a thorough review of the annual report and accounts and
ensuring that the narrative messages are consistent and accurately
reflect the financial statements and that the information as a whole is
fair, balanced and understandable;

• Assessing the appropriateness and effectiveness of the risk

management process, including overseeing management letters
of representation and control and risk self-assessment; and

• Developing the Group’s integrated assurance and internal control

models in conjunction with expected changes arising from the BEIS
consultation on audit and corporate governance reform.

Kevin Boyd
Chair of the Audit Committee
24 March 2022

EMIS Group plc | Annual report and accounts 2021

GOVERNANCE

Report of the
nomination committee

A robust,
sustainable
and diverse
Board

2021 MEMBERSHIP AND ATTENDANCE

Number of meetings

Patrick De Smedt (Chair)

Kevin Boyd

Jen Byrne

JP Rangaswami1

Denise Collis2

Andy McKeon3

Attended

Not attended

Dear Shareholder
I am pleased to present our report for the year ended
31 December 2021, which summarises our membership
and activities during the year.

1 JP Rangaswami joined the Board on 1 March 2021.

2 Denise Collis joined the Board on 1 October 2021.

3 Andy McKeon retired from the Board on 22 February 2022.

Board composition and succession planning
The committee continues its focus on Board composition
and succession planning, including a review of the skills
and experience needed to ensure a robust and sustainable
leadership model for the Board, its committees and the
wider management team.

The committee plays a vital role in ensuring the effectiveness
of the Board and its ability to deliver long-term success
for the business, including having the appropriate balance
of skills, experience and knowledge on the Board to both
reflect the changing needs of the business and anticipate
and prepare for the future.

• Other regular attendees by invitation are the Chief Executive

Officer, Chief Financial Officer and Company Secretary.

• The committee meets at least twice a year; it met twice in 2021.

• All committee members were considered independent upon

their appointment.

• The committee Chair provided a verbal update to the Board

following each committee meeting.

• Non-executive Directors are appointed by a letter of
appointment and details of their terms and those of
the Executive Directors are set out in the Directors’
remuneration report.

KEY RESPONSIBILITIES
The committee’s responsibilities are set out in its terms of
reference, which are reviewed annually. The terms of reference
can be found on the Group’s website at www.emisgroupplc.com.

The committee is responsible for:

• Ensuring that the balance of Directors on the Board remains

appropriate as the Group develops to ensure that the business
can compete effectively in the marketplace;

• Identifying and nominating candidates to fill Board vacancies

as and when they arise;

• Evaluation of the balance of skills, knowledge, experience and

diversity of the Board to ensure the optimum mix; and

• Consideration of the succession planning for Directors and

senior managers to ensure that there is a pipeline of high-calibre
candidates and that succession is managed smoothly.

EMIS Group plc | Annual report and accounts 2021

KEY ACTIVITIES IN 2021

Succession planning

• Review of succession plans for Executive Directors, GXT and critical positions.

• Review of personality assessments and development plans for Executive

Directors and GXT.

Board and committee composition

• Review of Board and committee composition and in particular the skills and

experience required for new Non-executive Directors.

• Search process undertaken for an additional Non-executive Director to be

appointed as Chair of the remuneration committee.

• Recommended the appointment of Denise Collis as a Non-executive Director and

Chair of the remuneration committee.

Governance

• Reviewed the committee’s terms of reference.

• Reviewed the time commitment required for Non-executive Directors.

• Carried out an internal committee evaluation.

Non-executive Director appointment and retirement
Having reviewed the balance of skills and pipeline of the Board, it was
agreed that a search for a new Non-executive Director be undertaken,
as a successor to Andy McKeon as Chair of the remuneration
committee. Spencer Stuart was engaged to assist with the search for
an additional Non-executive Director and the committee prepared a
description of the role and the capability required.

A detailed search and selection process then followed. A wide range
of candidates with gender and ethnically diverse characteristics was
assessed against the agreed criteria. A thorough process resulted in a
shortlist of preferred candidates, which was given final consideration by
the committee. The committee subsequently made recommendations to
the Board, culminating with the appointment of Denise Collis as a Non-
executive Director and also as Chair of the remuneration committee
with effect from 1 October 2021, subject to election by shareholders at
the forthcoming AGM on 5 May 2022.

As noted in the 2020 annual report and accounts, a similar recruitment
process was undertaken in 2020 and JP Rangaswami was appointed
to the Board on 1 March 2021. Details of the experience and skills
that Denise Collis and JP Rangaswami bring to the Board can be found
on page 51.

Andy McKeon retired from the Board as Senior Independent Director on
28 February 2022, having served nine years on the Board. Kevin Boyd took
on the role of Senior Independent Director on Andy McKeon’s retirement.

Diversity
The committee recognises the importance of a diverse Board and
is mindful of the issue of Board diversity in its succession plans. It
also acknowledges the importance of ensuring that the selection of
Directors and, in a wider context, employees throughout the Group
should be based upon a range of factors including skills, experience,
qualifications, background and values. Accordingly, all vacancies are
filled taking into account these wider factors and are not based to a
disproportionate extent on any one factor such as gender or ethnicity.

Diversity of the Board was a key consideration for the committee
during the year and will be a focus for the committee going forwards.

In line with the Hampton-Alexander review for FTSE 350 boards, our aim is
to have at least 33% female representation on the Board by the end of 2023.

Diversity remains a key factor in determining appropriate nominations
both for the Board and the Group as a whole, as it helps to promote
creativity, innovation, debate, understanding and ultimately better
overall decision making.

Director induction process
Following the appointment of any new Director, a full, formal and
customised induction to the Group is delivered. On appointment, the
Company Secretary provides information on the Group’s business, including:

• Board and relevant committee minutes and Board papers from at

least the last six months;

• Key policies, procedures and governance information about the Group,
including the whistleblowing policy, anti-bribery and corruption policy,
code of ethics and standards of business policy and share dealing code;

• Analysis of the Company’s key shareholders and share capital;

• Guidance for Directors on their legal and regulatory responsibilities

in an AIM-quoted company;

• Guidance on corporate governance and Board effectiveness; and

• Relevant information about the healthcare technology market.

As part of the induction process, the new Director:

• Attends business briefings with the Chief Executive Officer and

the Chief Financial Officer;

• Attends meetings with other members of the GXT;

• Attends meetings with individuals from around the Group to gain

a better understanding of the business and its culture; and

• Visits all principal UK sites when appropriate to do so.

Further to the appointments of JP Rangaswami and Denise Collis, full,
formal and customised inductions were carried out.

Board evaluation
The nomination committee undertakes an annual evaluation of its
performance and effectiveness. In 2021 an internal evaluation of the
committee’s own performance was carried out using a questionnaire.
The results of the evaluation were discussed by the Board and although
nothing significant was raised, recommendations were made to improve the
committee’s effectiveness.

Patrick De Smedt
Chair of the nomination committee
24 March 2022

EMIS Group plc | Annual report and accounts 2021

Report of the remuneration
committee

Committed to
best practice

Dear Shareholder
On behalf of the Board I am pleased to present the Directors’
remuneration report for the year ended 31 December 2021. It
includes my letter, the approved 2021 remuneration policy and the
annual report on remuneration, showing how our current policy was
applied during the year, outcomes for our Executive Directors and our
intentions for 2022.

I am also pleased to report that at our 2021 AGM, the advisory vote
on our remuneration report received 99.95% support, which reinforces
our view that our pay policy and its application continue to reflect our
business strategy, with remuneration payments that are strongly linked
to performance.

The Directors’ remuneration report will be presented at the AGM
on 5 May 2022 by way of an advisory vote.

Corporate performance
It has been a strong year for EMIS Group with revenue and adjusted
operating profit above expectations for 2021. Trading has returned to a
more normal pattern in EMIS Health. EMIS Enterprise has seen double-
digit growth, which is expected to continue during 2022.

The committee has taken overall Group performance including the
experience of shareholders and other stakeholders into consideration
when determining remuneration matters for 2021 and 2022.

EMIS Group plc | Annual report and accounts 2021

2021 MEMBERSHIP AND ATTENDANCE

Number of meetings

Denise Collis1

Patrick De Smedt

Kevin Boyd

Jen Byrne

JP Rangaswami2

Andy McKeon3

Attended

Not attended

1 Denise Collis became Chair on her appointment to the Board

on 1 October 2021.

2 JP Rangaswami became a member on his appointment to the Board

on 1 March 2021.

3 Andy McKeon stepped down as Chair to the committee on

1 October 2021 and retired from the Board on 28 February 2022.

• Other attendees to committee meetings by invitation include
the Chief Executive Officer, Chief Financial Officer, Group
HR Director and Company Secretary.

• Representatives from Mercer Limited, EMIS Group’s

independent remuneration adviser, attend on invitation.

• The committee meets at least twice a year; it met three times

in 2021.

• All committee members were considered independent upon

their appointment.

• The committee chair provided a verbal update to the board

following each committee meeting.

KEY RESPONSIBILITIES
The committee is responsible for:

• Oversight of overall remuneration policy issues for the

Group, including gender pay reporting and adherence to
legal obligations such as the national minimum wage;

• Determining the policy for Executive Director remuneration

and setting remuneration for the Chair of the Board,
Executive Directors and senior management;

• Determining the policy for, and scope of, pension and

benefits arrangements for each Executive Director and
senior management;

• Approving the design of, and determining targets for, any
performance-related pay schemes operated by the Group
and approving the total annual payments made under such
schemes;

• Reviewing the design of all share incentive plans for approval
by the Board and shareholders and determining each year
whether awards will be made and, if so, the overall amount
of such awards, the individual awards to Executive Directors
and other senior executives and the performance targets to
be used;

• Reviewing and noting annually the remuneration

arrangements, policies and trends across the Group; and

• Reviewing annually the committee’s terms of reference.

GOVERNANCERemuneration for 2021
Executive Directors were eligible to receive a bonus depending
primarily on the level of Group adjusted operating profit achieved.
Performance targets also included other financial and strategic
measures. Performance exceeded the on-target levels and the
remuneration committee therefore approved the payment of bonuses
of 135.5% of salary to Andy Thorburn and Peter Southby (being 90.4%
of maximum opportunity).

In 2021 the Group granted Long-Term Incentive Plan (LTIP) awards
to support and incentivise effective implementation of our published
strategy. The structure, amounts and performance targets for these
awards were included in last year's Directors’ remuneration report.

The 2019 LTIP performance conditions were partially met, which will
result in a vesting of 70.48% of the total award on the third anniversary
of the award, followed by a two-year holding period.

Pension contributions were capped in 2021 for the Executive Directors
at the 2020 base salary. As of 1 January 2023, employer pension
contributions for Executive Directors as a percentage of salary
will be aligned to the wider UK workforce, currently 6% of salary.
Further details of our plans to align pension contributions are set out
of page 81.

Further details about the variable pay awards are set out in the
Directors’ remuneration report on pages 76 to 81.

Discretion
The committee has considered whether the formula-driven payouts
under the incentive plans and resultant total remuneration for
Directors are appropriate, looking at the broader context within which
performance has been delivered. Following this review, the committee
has not deemed it necessary to make use of its discretionary powers for
2021 outturns.

Implementation of policy for 2022
Andy Thorburn and Peter Southby will be awarded a salary increase
of 3.5% from 1 April 2022, below the budgeted increase for the UK
workforce. Pension contributions for the Executive Directors will be
capped as noted above.

We have reviewed the bonus arrangements for Executive Directors
and the senior management team, taking into consideration the Group’s
strategy and the need to keep our Executives incentivised in line with
market expectations. The committee decided to set bonus levels for
2022 at 150% of salary for Executive Directors in line with 2021,
while continuing primarily to set targets according to adjusted profit,
to incorporate other financial and strategic performance measures
including an ESG measure. Adjusted profit and other financial measures
will account for 82% of the bonus opportunity. Target bonus levels
remain at 50% of maximum and the maximum bonus will only be paid in
the event of extremely high levels of performance.

An ordinary LTIP award of 150% of salary for Andy Thorburn and 100%
for Peter Southby will be granted in 2022. The award will vest in three
years’ time subject to the achievement of performance conditions,
which are in line with those awarded in 2021. Targets and further
details of the 2022 awards are set out on page 81.

Non-executive Directors’ fees and Chair fees will increase by 2% from 1
April 2022. An additional fee of £8,160 will also be implemented for the
Senior Independent Director from 1 April 2022.

There will be a free share award to all eligible UK employees in April
2022, for those with more than six months’ service, including the
Executive Directors. This award is to recognise employees’ contribution
to the Group’s success in the last financial year.

UK Corporate Governance Code
The Company is quoted on AIM and adopts the Code. We remain
committed to best practice in designing our remuneration policy and
have clearly defined terms of reference which are reviewed annually
and listed on our website at www.emisgroupplc.com/investors. The
committee reviewed its compliance with the Code and concluded that
the remuneration arrangements complied with the Code other than
on two aspects, namely Provision 38 pension alignment and Provision
41 employee engagement to explain how executive remuneration
aligns with the wider company pay policy. Although there is a great
deal of employee engagement and overall workforce benefits and
remuneration are discussed with employees, executive remuneration
specifically has not been raised or discussed at the employee forums.
We intend to conduct a review of our engagement around all aspects of
remuneration, including executive remuneration, during 2022. As noted
above, pension contributions will be reduced and aligned to the wider
UK workforce from 1 January 2023.

Shareholder engagement
In February 2021 we engaged with our major shareholders on
executive remuneration, including plans for pension alignment, 2021
bonus opportunity and structure and the implementation of a post-
employment shareholding guideline. The general feedback from
shareholders was in agreement with the proposed remuneration plans.

Gender and ethnicity pay reporting
Data on the gender pay gap for 2020 was published in 2021 and
showed a mean gap of 6.4% (a 16% reduction from the previous year)
for EMIS Group. In 2021, there has been a continued focus on reducing
the gender pay gap through comparing salaries in any pay reviews and
by supporting female candidates within recruitment campaigns for
senior roles. Gender pay gap data for 2021 has recently been calculated
showing a slight increase of the mean gap from the previous year to
7.6% as a result of a small number of senior female resignations which
disproportionately affected the statistics. This data will be published in
April 2022 in line with the guidelines. Work is continuing over time to
address the gender pay gap further by a review of salaries at all levels
where there is a gap, and through seeking to ensure that EMIS is an
attractive employer to all, regardless of gender or background.

During the year a review was undertaken for the first time on the
ethnicity pay gap and this showed a mean gap of 17.5%. As data was
also available for the previous year, we can see that year on year this
had reduced by 1.8%. Steps are now underway to understand the detail
behind the gap and we will be setting a target to reduce it in 2022
and beyond.

Committee effectiveness
An internal annual effectiveness review was carried out in 2021 by way
of a questionnaire which was circulated for completion by members
and regular attendees. The findings were discussed at the committee
meeting in January 2022, which concluded that the committee
continued to operate effectively. No areas of concern were highlighted
during the review, although it was agreed that there would be a review
of engagement around reward and a fair pay remuneration committee
meeting will be scheduled later in the year.

The committee appreciates the support received from shareholders to
date on its executive remuneration and governance approach and looks
forward to this continued support for the resolution to approve the
annual report on remuneration at the AGM in May 2022.

Denise Collis
Chair of the remuneration committee
24 March 2022

EMIS Group plc | Annual report and accounts 2021

Report of the remuneration committee continued

KEY ACTIVITIES IN 2021

Directors’ remuneration

• Reviewed and approved Directors’ remuneration.

Executive remuneration

• Reviewed the 2020 Directors’ remuneration report prior to its approval
by the Board and subsequent approval by shareholders at the 2021 AGM.

• Considered pension contributions and alignment across the Group.

• Reviewed the GXT’s remuneration packages and wider remuneration
across the Group with the aim of recognising best practice, aligning
with shareholder objectives and encouraging behaviours to maintain
the long-term success of the business.

• Reviewed Group performance against the 2020 annual bonus plan

targets and set metrics to apply to the 2021 bonus plan.

• Reviewed LTIP criteria and targets and approved the 2021-2023 awards.

• Reviewed performance and approved the outcome of the 2018–2020

LTIP awards.

Human resources and policy

• Reviewed the gender pay gap and ethnicity pay gap analysis.

• Reviewed the policies and incentives implemented across the Group

in the last twelve months.

• Reviewed the national minimum wage and agreed actions to

maintain compliance.

Governance

• Reviewed compliance with the Code.

• Reviewed the committee’s terms of reference.

• Carried out an internal committee evaluation.

• Considered changes to the LTIP plan rules for issuance of restricted

stock below Executive Director level.

EMIS Group plc | Annual report and accounts 2021

GOVERNANCEDirectors’ remuneration report
Directors’ remuneration policy

The remuneration policy aims to ensure that members of the Board and Executive management are provided with appropriate incentives to
encourage enhanced performance and are, in a fair and responsible manner, rewarded for their contribution to the success of the Group. The
policy outlined on pages 69 to 72 was disclosed in the 2020 annual report and accounts and presented to the AGM on 6 May 2021 as part of
the advisory vote on the whole remuneration report, which received 99.95% support. There are no changes proposed for 2022.

Policy table
The policy table below summarises the key components of remuneration for Executive Directors:

Element

Base salary

To recognise the individual’s
skills and experience and
provide a competitive base
reward to attract and retain
Executive Directors.

Operation

Opportunity

Performance metrics

Base salaries are usually reviewed
annually, taking into account the
individual’s performance, responsibility,
skills and experience; Group performance
and market conditions; salary levels for
similar roles at relevant comparators
(including companies of a similar size and
sector); and pay levels and percentage
salary increases across the wider employee
population. There is no set maximum.

Any changes will normally take effect
from 1 April each year.

None.

While there is no maximum salary, any
increase will typically be in line with
those awarded to the wider employee
population. The committee has
discretion to award higher increases
in circumstances that it considers
appropriate, such as:

• A material change in the size or
complexity of the business or
responsibility of the role;

• Development in the role;

• Changes in market practice; and

• Moving the salary of a newly

appointed Executive Director to be
aligned with a market competitive
range over time.

Details of salary changes will be
disclosed in the annual report and
accounts in the relevant year.

Pension

To provide a
market competitive
retirement benefit.

The Group makes contributions to
the private pension schemes or other
appropriate arrangements for the
Executive Directors. The committee has
discretion to authorise cash payments
in lieu of pension contribution. Such a
payment would not count for bonus or
LTIP purposes.

None.

Executive Directors receive a
contribution or cash payment in lieu of
up to 15% of their 2020 base salary.
This is capped for 2021 and 2022
and thereafter employer pension
contributions will be aligned to the UK
workforce. Pension contributions for any
new Executive Directors will be aligned
to the UK workforce.

Share Incentive Plan (SIP)

To provide market
competitive benefits.

Participants can purchase shares up to
the limits allowed by the legislation from
time to time (currently up to £1,800 per
tax year).

None.

Matching shares may be awarded up to
the limits allowed by the legislation from
time to time.

The Company currently offers to match
purchases made through the plan at the
rate of one matching share for every
two shares purchased.

Open to all UK tax resident employees
of participating Group companies with
at least six months’ service.

The plan is an HMRC tax qualifying plan
that allows an employee to purchase
shares using gross pay. If an employee
agrees to purchase shares, the Group
matches purchased shares with an award
of matching shares which are subject to
continued employment for three years.
Dividends accrue on purchased shares
and matching shares and are reinvested
into additional shares.

From time to time, EMIS Group may offer
all employees free share awards up to the
HMRC approved limits.

EMIS Group plc | Annual report and accounts 2021

Directors’ remuneration report continued
Directors’ remuneration policy continued

Policy table continued

Element

Benefits

Operation

Opportunity

Performance metrics

To provide market
competitive benefits.

Benefits may include, but are not limited
to, a car allowance and life insurance.

Executive Directors are eligible for any
benefits offered to the wider workforce
in their geography.

In certain circumstances, the committee
may also approve the provision of
additional allowances relating to the
relocation of an Executive Director and
other expatriate benefits to perform his
or her role.

None.

While no maximum level of benefits has
been set, the value of benefits provided
is set at a level which the committee
considers to be appropriately
positioned taking into account the role
and individual circumstances; benefits
provided are reviewed periodically.

Benefits in respect of the year under
review are disclosed in the annual
report on remuneration.

Annual bonus

To provide an incentive
to drive the Executive
Directors to deliver
stretching performance
and growth.

Performance measures, targets and
weightings are set by the committee at
the start of the bonus period.

For Executive Directors, the maximum
annual bonus opportunity is up to
150% of base salary.

For target performance, the bonus level
is up to 50% of the maximum payable
for the year. Threshold payments are
no more than 25% of the maximum
payable for the year.

At the end of each bonus period, the
committee determines the extent to
which targets have been achieved. The
committee has the discretion to adjust
the formulaic bonus outcomes both
upwards (within the plan limits) and
downwards to ensure that payments
accurately reflect business performance
over the performance period, e.g. in
the event of unforeseen circumstances
outside of management control.

At the discretion of the committee,
Executive Directors may be required to
invest up to 40% of any after tax amount
in shares, to be held until the minimum
shareholding requirement is met.

Bonuses are subject to clawback for
a period of one year after award.

Performance is usually
assessed on an annual
basis, using a combination
of the Group’s main KPIs
for the year. Measures
may include financial and
non-financial metrics as
well as the achievement
of strategic and personal
objectives. A minimum of
80% of the bonus will be
determined by financial
objectives. The principal
financial performance
measure currently
assessed is Group adjusted
operating profit; however,
the committee has the
discretion to adjust
performance measures
and weightings to ensure
that they continue to be
linked to the delivery of
Group strategy.

The range of performance
required under each
measure is calibrated with
reference to external
expectations and the
Group’s internal budgets.
Any personal element is
based on the strength of
the Executive Director’s
personal performance over
the course of the year
against agreed objectives.

EMIS Group plc | Annual report and accounts 2021

GOVERNANCEElement

LTIP

Operation

Opportunity

Performance metrics

Ordinarily a single award of up to 200%
of base salary which normally vests
after three years may be awarded.
In respect of 2022, this award will
be 150% of salary for the Chief
Executive Officer and 100% for the
Chief Financial Officer. Each year the
committee determines the maximum
LTIP opportunity, the measurement
period and the threshold level.
Threshold performance will result in
up to 25% of maximum vesting for
the period set, rising to full vesting
for maximum levels of performance in
accordance with the targets set by the
committee for the period in question.

Awards vest subject to
performance measure(s)
based on key financial
metrics which may include,
for example, measures
based on earnings per
share (EPS) and absolute
or relative growth in
share price.

The committee has
discretion to adjust the
choice of performance
measures and weightings to
ensure that they continue
to be linked to the delivery
of Group strategy.

The committee has the
discretion to adjust
formulaic LTIP outcomes
to ensure that payments
accurately reflect business
performance over the
performance period.

To drive sustained business
performance, aid retention
and align the interest
of Executive Directors
with shareholders.

Awards are made in the form of conditional
share awards, or nil-cost options which
vest subject to the achievement of pre-
defined performance conditions normally
measured over a three-year period.

At the start of each performance period,
the committee reviews the award
levels and performance conditions to
ensure they remain appropriate and sets
performance targets that it considers to be
appropriately stretching.

Following the end of the performance
period, and the vesting of any awards, a
two-year “holding period” applies.

This may be structured as either: (1) a
requirement that the Executive Directors
retain for the holding period the shares
they acquire, subject to being permitted to
dispose of shares to meet any resultant tax
liability; or (2) a restriction that prevents
the Executive Directors from exercising any
vested share awards until the end of the
holding period. Where the holding period is
operated on the latter basis, the committee
may make additional payment (in cash or
additional shares) in respect of shares that
vest to reflect the value of dividends which
would have been paid on these shares
during the period beginning with the date
of vesting and ending with the date on
which the share award may be exercised
(and this payment may assume that the
dividends were reinvested in additional
shares on such basis as the committee
may determine). Where awards vest over
a longer period than three years, the
holding period will be reduced so that the
maximum period between an award and
the right to dispose of shares will be five
years. During the holding period the shares
are not subject to performance conditions.

LTIP awards are subject to clawback
for a period of up to two years
following vesting.

Share ownership requirements

To ensure alignment of
the long-term interests
of Executive Directors
and shareholders.

Executive Directors are required
to acquire a minimum shareholding
equivalent to 200% of base salary for
the Chief Executive Officer and 100% of
salary for the Chief Financial Officer.

Executive Directors are required to retain
shares acquired under the LTIP (subject
to sales to cover tax liabilities) until they
have satisfied the guideline.

Not applicable.

None.

EMIS Group plc | Annual report and accounts 2021

Directors’ remuneration report continued
Directors’ remuneration policy continued

Policy table continued

Element

Operation

Opportunity

Performance metrics

Post-employment share ownership requirements

To ensure alignment of
the long-term interests of
EMIS and its shareholders
post-employment.

Executive Directors are required to
hold the lower of their share ownership
requirement or their shareholding at the
date of leaving. This applies for a period
of one year post-employment. The
requirement applies to shares vesting (net
of tax) from awards granted from 2021
onwards only.

Not applicable.

None.

Notes to the policy table
Performance measurement selection
The aim of the bonus plan is to reward key Executives over and above base salary for the achievement of business objectives. The bonus criteria
are selected annually to reflect the Group’s main KPIs for the year and are designed to encourage continuous performance improvement for the
Group. Group financial performance targets relating to the bonus plan are set with reference to the Group’s annual budget, which is reviewed
and signed off by the Group Board prior to the start of each financial year. Adjusted operating profit is currently used as the principal KPI for the
annual bonus plan because it is a clear measure of the underlying financial performance of the Group.

LTIP awards are based on EPS growth and Total Shareholder Return (TSR) performance, normally over three years.

Targets applying to the bonus and LTIP are reviewed regularly, based on a number of internal and external reference points. Performance targets
are set to be stretching but achievable, with regard to the particular strategic priorities and economic environment in a given year.

The committee retains the ability to adjust performance measures or targets if events occur (such as a change in Group strategy, a material
acquisition and/or a divestment of a Group business or a change in prevailing market conditions) which cause the committee to determine that
measures are no longer appropriate and that an amendment is required so that they achieve their original purpose.

Awards under the LTIP and deferred share awards may be adjusted in the event of a variation of the Company’s share capital or other relevant
event in accordance with the terms of the awards.

Malus and clawback provisions
Clawback applies if the figures on which awards were based are shown to be inaccurate or there is misconduct by the individual or action which
has damaged EMIS Group’s reputation or, in the case of LTIPs, if there is significant deterioration in financial performance. These provisions apply
for one year after the award of a bonus and during the two-year retention period for an LTIP.

Remuneration policy for other employees
The approach to annual salary reviews is consistent across the Group, with consideration given to individual performance, skills, experience and
responsibility, Group performance and market conditions, and salary levels for similar roles in relevant comparators. Opportunities and specific
performance conditions vary by organisational level with business area-specific metrics incorporated where appropriate. A management group
of approximately 200 individuals is eligible to participate in the LTIP and restricted stock. Award sizes vary by organisational level. Specific cash
incentives are also in place to motivate, reward and retain staff below Board level. All UK-based employees are eligible to participate in the
Company’s SIP scheme on the same terms.

Pay scenario charts for Executive Directors
The charts below provide estimates of the potential future reward opportunity for each of the two current Executive Directors for 2022 and the
potential split between different elements of remuneration under four different scenarios: “minimum”, “target”, “maximum” and “maximum plus 50%
share price appreciation” performance.

CHIEF EXECUTIVE OFFICER –
ANDY THORBURN

CHIEF FINANCIAL OFFICER –
PETER SOUTHBY

Maximum Plus

Maximum

Target

Minimum

992

513

2,112

Maximum Plus

1,792

Maximum

Target

1,190

1,049

625

Minimum

343

£’000

300

600

900

1,200 1,500 1,800

2,100

£’000

300

600

900

1,200 1,500 1,800

2,100

Basic salary and benefits

Bonus

Long-term Incentives

EMIS Group plc | Annual report and accounts 2021

GOVERNANCEPotential reward opportunities illustrated on page 72 are based on the remuneration policy, applied to the base salary as at 1 April 2022. It should
be noted that LTIP awards granted in a year normally vest following the end of a three-year performance period and the projected value of LTIP
amounts excludes the impact of share price movement over the vesting period, except for the “maximum plus 50% share price appreciation”
scenario. All other elements of actual pay delivered, however, will be determined by the following factors:

Fixed

Component

Base salary

“Minimum”

“Target”

“Maximum”

“Maximum plus 50%
share price appreciation”

Salary as of 1 April 2022 - Chief Executive Officer £426,420 and Chief Financial Officer
£282,412

Pension

Contribution rate applied to 2020 salary1

Other benefits

Benefits as provided in the single figure table on page 76

Annual bonus

LTIP

No bonus payable

No LTIP vesting

50% of maximum
(75% of salary)

25% of maximum
(37.5% and 25% of
salary for Chief
Executive Officer and
Chief Financial Officer
respectively)

150% of salary

As per maximum

150% and 100%
of salary for Chief
Executive Officer and
Chief Financial Officer
respectively

As per maximum
with additional 50%
share price
appreciation

1 Pension contributions capped at the 2020 salary level (i.e. 2020 salary: Chief Executive Officer £412,000 and Chief Financial Officer £272,862).

Approach to recruitment remuneration – Executive Directors
When hiring or appointing a new Executive Director, the committee may make use of any or all of the existing components of remuneration, as follows:

Component Approach

Base salary

The base salaries of new appointees will be determined by reference to the individual’s
role, responsibilities, experience and skills, relevant market data, internal relativities
and their current basic salary. Where new appointees have initial basic salaries set
below market rate, any shortfall may be managed with phased increases over a period
of years subject to their development in the role.

Pension

New appointees will be eligible to receive a pension contribution in line with existing policy.

SIP

New appointees will be eligible to participate in the Company’s HMRC tax qualifying
all-employee share scheme, in line with the policy and the eligibility criteria.

Benefits

New appointees will be eligible to receive benefits in line with the policy.

Maximum value

Not applicable.

Annual bonus

The annual bonus described in the policy table will apply to new appointees with the
relevant maximum ordinarily being pro-rated to reflect the proportion of employment
over the bonus period. Targets for the individual element will be tailored to the Executive.

Up to 150% of salary p.a.

LTIP

New appointees will be eligible for awards under the LTIP which will normally be on the
same terms as awards made to other Executive Directors, as described in the policy table.

Up to 200% of salary p.a.

In determining appropriate remuneration for a new Executive Director, the committee will take into consideration all relevant factors (including
the quantum, nature of remuneration and jurisdiction from which the candidate was recruited) to ensure that the pay arrangements are in the
best interests of the Group and its shareholders.

The committee may include additional elements of pay which it considers appropriate in circumstances which may include: interim appointments;
Non-executive Directors taking on an Executive function on a short-term basis; and where the timing of the recruitment means that it would be
inappropriate to provide a bonus or LTIP opportunity for the year, in which case the quantum in respect of the opportunity for the year of recruitment
may be transferred to the subsequent year in order that reward is provided on a fair and appropriate basis. However, the committee’s discretion is not
uncapped. As noted above, salary, pension and benefits will be provided in line with the existing policy and non-performance-related incentives (such
as a “golden hello”) will not be offered. The committee may alter the performance measures and vesting periods of incentive remuneration and the
deferral arrangements for the bonus or holding period for the LTIP to reflect the circumstances of the recruitment. The rationale for any exercise
of this discretion will be explained in the following Directors’ remuneration report.

In addition to the above elements of remuneration, the committee may consider it appropriate to grant an award under a different structure
in order to facilitate the recruitment of an individual, to replace remuneration, benefits and/or incentive arrangements forfeited on leaving a
previous employer.

Any “buyout awards” would typically have a fair value no higher than and be receivable no sooner than the awards forfeited. In doing so, the
committee will consider relevant factors including any performance conditions attached to these awards, the likelihood of those conditions being
met and the proportion of the vesting period remaining. Such awards would typically be subject to clawback.

In the event of the appointment of a new Executive Director by way of internal promotion, the remuneration committee will be consistent with
the policy for external appointees detailed above. Where an individual has contractual commitments made prior to their promotion to Executive
Director level, the Company will continue to honour these arrangements.

EMIS Group plc | Annual report and accounts 2021

Directors’ remuneration report continued
Directors’ remuneration policy continued

Approach to recruitment remuneration – Executive Directors continued
External appointments
It is the Board’s policy to allow each Executive Director to take up one non-executive position on the board of another company, subject to the
prior approval of the Board. Any fee earned in relation to outside appointments is retained by the Executive Director. No such positions were
taken and so no such fees were paid during the financial year.

Service contracts/letters of appointment
The Executive Directors are employed under contracts of employment with the Group.

The Non-executive Directors including the Chair are appointed under letters of appointment, usually for a term of three years.

Executive Directors’ contracts and Non-executive Directors' letters of appointment and reappointment are available to view at the Company’s
Registered Office.

Executive Directors

Non-executive Directors

Andy
Thorburn

Peter
Southby

Patrick
De Smedt

Kevin
Boyd

May 2014
(renewed
in 2017

Denise
Collis

JP
Rangaswami

Jen
Byrne

May 2017 October 2012

January 2020

and 2020) October 2021

March 2021

May 2019

12
12

3
3

Date of contract/
appointment

Notice period in months
Company
Director

Remuneration policy for the Chair and the Non-executive Directors
The Board determines the remuneration policy and level of fees for the Non-executive Directors, within the limits set out in the Articles
of Association. The remuneration committee recommends the remuneration policy and level of fees for the Chair of the Board.

The policy table below summarises the key components of remuneration for the Chair and Non-executive Directors.

Element

Fees

To reflect market competitive rates
for the role, as well as individual
performance and contribution.

Performance
metrics

None.

Operation

Opportunity

The Chair and Non-executive Directors
receive a basic fee for their respective
roles. Additional fees may be paid to
Non-executive Directors for additional
services such as chairing a Board
committee or acting as the Senior
Independent Non-executive Director.
Expenses related to the Non-executive
Directors’ duties, such as travel and
accommodation or secretarial support,
may also be reimbursed.

Fees are reviewed annually with
reference to information provided by
remuneration surveys, the extent of the
duties performed, time commitment and
the size and complexity of the Group.
Fee levels are benchmarked against
sector comparators and appropriate listed
companies of similar size and complexity.

Fee increases are applied in line with the
outcome of the annual review. Fees for
the year commencing 1 January 2022
are set out in the annual report
on remuneration.

There is no prescribed maximum fee.
It is expected that increases to Non-
executive Director fee levels will be in
line with salaried employees over the life
of the policy. However, in the event that
there is a material misalignment with the
market or a change in the complexity,
responsibility or time commitment
required to fulfil a Non-executive Director
role, the Board has discretion to make an
appropriate adjustment to the fee level.

EMIS Group plc | Annual report and accounts 2021

GOVERNANCENon-executive Directors’ remuneration
In the case of hiring or appointing a new Non-executive Director, the committee will follow the policy as set out in the table on page 74. A base
fee in line with the prevailing fee schedule would be payable for Board membership, with additional fees payable for additional services, such as
chairing a Board committee.

Exit payment policy
The Company’s policy is to limit any payment made to a departing Director to contractual arrangements and to honour any pre-established
commitments. A payment in lieu of notice (consisting of salary, benefits and pension contributions for the relevant portion of the notice period)
may be made. As part of this process, the committee will take into consideration the Executive Director’s duty to mitigate their loss.

The table below summarises how the awards under the bonus scheme and LTIP are typically treated in different leaver scenarios and a change of
control. Whilst the committee retains overall discretion on determining “good leaver” status, it typically defines a “good leaver” in circumstances
such as ill health, disability, death, redundancy, or any other reason as the committee decides. Final treatment is subject to the committee’s
discretion. The holding period that applies to vested LTIP awards ceases when an individual leaves, subject to any post-employment shareholding
requirements that may apply.

Reason for
leaving

Annual bonus

Timing of vesting

Treatment of awards

“Good leaver”

Usually paid at the same time as continuing employees.

Pro rata payments may also be made early on
compassionate grounds to a “good leaver”.

Eligible for an award to the extent that performance targets
are satisfied and the award is pro-rated for the proportion
of the financial year served.

“Bad leaver”

No annual bonus payable.

Not applicable.

Change of control

Paid immediately on the effective date of change of control.

LTIP

“Good leaver”
– awards which
are still subject
to performance
conditions

Continue until the normal vesting date or vest
immediately, at the discretion of the committee. In the
event of the death of a participant, the award would
vest immediately.

Eligible for an award to the extent that performance targets
are satisfied up to the change of control and the award is
pro-rated for the proportion of the financial year served to
the effective date of change of control.

Outstanding awards vest to the extent the performance
conditions are or are reasonably considered to be likely
to be satisfied and the awards are pro-rated to reflect
the length of the performance period served unless the
remuneration committee decides otherwise. In the event of
the death of a participant during the performance period,
the award would vest in full.

“Bad leaver”

Outstanding awards are forfeited.

Not applicable.

Change of control

Vest immediately on the effective date of change of control. Outstanding awards vest subject to the satisfaction of

performance conditions as at the effective date of change
of control, and the award is pro-rated for the proportion
of the performance period served to the effective date
of change of control unless the remuneration committee
decides otherwise.

EMIS Group plc | Annual report and accounts 2021

Directors’ remuneration report continued
Annual report on remuneration

The following section provides details of how the remuneration policy was implemented during the financial year ended 31 December 2021.

Remuneration committee membership in 2021
The members of the committee and their attendance record at meetings during the year are set out on page 66. JP Rangaswami joined the
committee on his appointment to the Board on 1 March 2021. Denise Collis took over as Chair of the committee on her appointment to the
Board on 1 October 2021.

During the year, the committee sought internal support from the Chief Executive Officer, the Chief Financial Officer and the Group HR Director,
who attend committee meetings by invitation from the Chair, to advise on specific questions raised by the committee and on matters relating to
the performance and remuneration of senior managers where it was considered that their attendance would make a significant contribution. None
of these officers were present for any discussions that related directly to their own remuneration. The Company Secretary attended each meeting
as Secretary to the committee.

Independent advice
In undertaking its responsibilities, the committee seeks independent external advice as necessary. Since June 2019, Mercer Limited has acted as
the independent remuneration adviser to the committee. Mercer Limited is available to provide advice on a wide range of remuneration matters
including current market practice, benchmarking of executive pay, LTIP performance measures, the remuneration policy and incentive scheme design.
Total adviser fees to the committee during 2021 were £34,000.

Mercer Limited is subject to periodic performance evaluation in common with other advisers to the Group.

The committee is satisfied that Mercer Limited provides independent remuneration advice to the committee. Mercer Limited is a member and
signatory of the Remuneration Consultants Group and voluntarily operates under its Code of Conduct in relation to executive remuneration
consulting in the UK, details of which can be found at www.remunerationconsultantsgroup.com.

Summary of shareholder voting at the 2021 AGM
There was an advisory vote on the Directors’ remuneration report at the AGM in 2021. Of the 36,428,338 votes cast, 36,405,381 (99.95%) of
the votes were in favour of the resolution, with 18,674 (0.05%) against and 4,283 votes withheld. The results of the votes were published on the
website after the meeting.

Single total figure of remuneration for Executive Directors – audited
The table below sets out a single figure for the total remuneration received by each Executive Director for the year ended 31 December 2021
and the prior year:

Base salary
Taxable benefits1
Pension2
Annual bonus3
Share schemes4

Total

Split into:
Total fixed pay
Total variable pay

Andy Thorburn
£’000

Peter Southby
£’000

2021

412
24
62
558
500

2020

409
21
61
205
480

1,556

1,176

498
1,058

491
685

2021

273
19
41
370
223

926

333
593

2020

271
17
41
135
190

654

329
325

1 Taxable benefits consist primarily of a car allowance or company car, private medical insurance, business travel and subsistence (where taxable).

2 During the year the Executive Directors received 15% of 2020 base salary as employer contributions. At the request of Peter Southby £37,000 (2020: £35,000)

of employer pension contributions were commuted to a cash payment in accordance with the remuneration policy.

3 This is the total bonus earned in respect of performance during the relevant year. Annual bonuses are received in cash. Further details of annual bonus awards

for 2021 can be found in the annual report on remuneration on pages 77 to 78.

4 The amounts shown reflect the value of matching shares awarded under the SIP, the value of the free share award made under the SIP and the expected value

of the 2019–2021 LTIP awards that will vest in April 2022 (calculated using the three-month average share price to 31 December 2021). For the Chief Executive
Officer, £77,000 of the value is attributable to share price appreciation and for the Chief Financial Officer £34,000. Further details can be found on page 78. The
values shown for 2020 have been restated from those shown in last year’s annual report on remuneration to reflect the share price that applied on the date of
vesting (1224p on 20 April 2021), for the 2018-2021 LTIP award which vested at 41.8% of the maximum. For the Chief Executive Officer, £96,000 of the value is
attributable to share price appreciation and for the Chief Financial Officer £38,000.

EMIS Group plc | Annual report and accounts 2021

GOVERNANCESingle total figure of remuneration for Non-executive Directors – audited
The table below sets out a single figure for the total remuneration received by each Non-executive Director for the year ended 31 December 2021
and the prior year:

Patrick De Smedt1
Andy McKeon
Kevin Boyd
Jen Byrne
JP Rangaswami2
Denise Collis3
Mike O’Leary4

Board fee
£’000

Committee Chair fee
£’000

Fees
£’000

2021

2020

2021

2020

2021

2020

160
45
45
45
38
11
—

121
45
45
45
—
—
42

—
6
8
—
—
2
—

—
8
8
—
—
—
—

160
51
53
45
38
13
—

121
53
53
45
—
—
42

1 Patrick De Smedt was appointed to the Board on 1 January 2020

3 Denise Collis was appointed to the Board on 1 October 2021.

and appointed as Chair on 6 May 2021.

2 JP Rangaswami was appointed to the Board on 1 March 2021.

4 Mike O’Leary retired from the Board on 6 May 2020.

Incentive outcomes for the year ended 31 December 2021
Bonus
During the year ended 31 December 2021, Executive Directors were eligible to receive a bonus of up to 150% of salary, depending on the level
of Group adjusted operating profit achieved and certain other financial and strategic targets. Target performance was calibrated to deliver a bonus
of 50% of maximum. Bonuses are paid entirely in cash and are subject to clawback. Corporate targets set by the committee require Executive
Directors to deliver significant stretch performance to achieve maximum bonus.

The targets and actual performance for 2021 were as follows:

Performance metric and weighting
(% of maximum opportunity)

Group adjusted operating profit
(66.6% weighting)

Performance targets

• <£38.5m: no payment;

• £40.7m: 25% of maximum bonus; and

• ≥£44.3m: 66.6% of maximum bonus.

Overall revenue growth (6.7% weighting)

Performance between points results in a pro rata bonus payment
calculated on a straight-line basis.
• <£160m: no payment;

Revenue growth for Enterprise
(6.7% weighting)

• £160m: 2% of maximum bonus;

• £165m: 5% of maximum bonus; and

• ≥£171m: 6.7% of maximum bonus.

Performance between points results in a pro rata bonus payment
calculated on a straight-line basis.
• <5% growth: no payment;

• 5% growth: 4% of maximum bonus;

• 10% growth: 5% of maximum bonus; and

• ≥15% growth: 6.7% of maximum bonus.

Performance between points results in a pro rata bonus payment
calculated on a straight-line basis.

Actual
performance

57.8%

5.9%

6.7%

EMIS Group plc | Annual report and accounts 2021

Directors’ remuneration report continued
Annual report on remuneration continued

Incentive outcomes for the year ended 31 December 2021 continued
Bonus continued

Performance metric and weighting
(% of maximum opportunity)

Performance targets

Actual
performance

Non-financial targets1 (20% weighting)

Customer satisfaction average contact response time:

6.7%

• More than 120 seconds: no payment;

• No more than 120 seconds: 3.3% of maximum bonus;

• No more than 80 seconds: 4.7% of maximum bonus; and

• Response in ≤60 seconds: 6.7% of maximum bonus.

Performance between points results in a pro rata bonus payment
calculated on a straight-line basis.

Employee engagement based on the proportion of employees answering
agree or strongly agree on two questions:

6.7%

1. I have regular meetings with my manager which include good two-way
dialogue; and 2. As part of a mainly remote workforce, I feel engaged with
the business and my colleagues:

• Less than 70% strongly agree or agree: no payment;

• 70% strongly agree or agree: 3.3% of maximum bonus;

• 75% strongly agree or agree: 4.7% of maximum bonus; and

• ≥80% strongly agree or agree: 6.7% of maximum bonus.

Performance between points results in a pro rata bonus payment
calculated on a straight-line basis.

Technology transformation programme delivery:

• May result in a bonus payment between 2% and 3.3% of maximum

bonus depending on targets reached.

Pinnacle (successful scaling up of support for the Covid-19 vaccination
programme) acceleration:

• May result in a bonus payment of up to 3.3% of maximum bonus for

scaling up to match the vaccination programme.

3.3%

TOTAL

90.4% of maximum opportunity.

The committee determined that a total bonus of 135.5% of salary was achieved.

(135.5% of salary for the Chief Executive Officer and Chief Financial Officer).

Long-term incentive awards vesting (audited)
For the 2019–2021 LTIP awards, there were two elements. The first, based on EPS growth over the three years to 31 December 2021 with a
weighting of 80% of the award, was partly met, resulting in 50.48% vesting of this element. The second element, based on TSR performance with a
weighting of 20% of the award, was fully met, resulting in 100% vesting of this element. Overall therefore, 70.48% of the total award will vest in April
2022, subject to continued employment. Awards will be subject to a two-year holding period. The performance targets for this award were as follows:

Performance level

Below base target
Base target
Maximum target

EPS growth

% award to vest

TSR

% award to vest

Below 5% p.a.
5% p.a.
10% p.a.

0%
20%
80%

Below median
Equal to median
Upper quartile

0%
5%
20%

Vesting value of awards vesting in 2021 (audited)

On grant

At the end of the performance period

Andy Thorburn
Peter Southby

Number of
shares awarded

% of
salary granted

53,475
23,610

150%
100%

Dividend
equivalent
accrued during
performance
period

Number of
vesting shares

Number of
shares lapsing

Impact of
share price
performance
£'000

Total vesting
of award £'000

0
0

37,690
16,641

15,785
6,969

77
34

499
220

EMIS Group plc | Annual report and accounts 2021

GOVERNANCEScheme interests awarded in 2021 (audited)
Long-Term Incentive Plan
In 2021, the following awards were granted under the LTIP:

Executive Director

Andy Thorburn

Peter Southby

Date of
grant

Awards made
during
the year

Market price
at date of
award

Normal
vesting
date

7 April 2021

54,210

23,935

1140p

7 April 2024

Face value
at date of
award
£’000

618

273

Performance conditions for 2021 awards
The ordinary annual awards granted in April 2021 include two performance targets. 75% of the award is subject to a performance target based on
compound annual EPS growth and 25% of the award is subject to a performance target comparing the Company’s TSR against the FTSE SmallCap.
Both performance targets are measured over three financial years, 2021 to 2023.

Ordinary annual award

Performance level

Below base target
Base target
Maximum target

EPS growth

% award to vest

TSR

% award to vest

Below 5% p.a.
5% p.a.
10% p.a.

0%
18.75%
75.00%

Below median
Equal to median
Upper quartile

0%
6.25%
25.00%

To the extent that base target is exceeded, the percentage of award shares vesting increases pro rata between the base target and maximum target.

SIP awards
During the year under review, Peter Southby was awarded matching shares under the SIP as a result of his own personal contributions in acquiring
partnership shares. The value of these was less than £1,000. There were no performance conditions attached to the SIP awards. Peter Southby
participates in the SIP to the maximum extent permitted by HMRC. Andy Thorburn and Peter Southby received dividend shares on their SIP
holding during the year, with the value of these being less than £1,000 each. In April 2021, Andy Thorburn and Peter Southby received a free
share award under the SIP, both receiving 50 shares. The value of these was less than £1,000.

Executive Directors participate in the SIP on the same terms as other UK employees.

Ad hoc payments
There were no ad hoc payments to any Directors for the year ended 31 December 2021 (2020: nil).

Loss of office payments (audited)
There were no loss of office payments for the year ended 31 December 2021 (2020: nil).

Payments to past Directors (audited)
There were no payments to past Directors for the year ended 31 December 2021 (2020: nil).

Relative importance of spend on pay
The table below shows the Group’s expenditure on shareholder distributions (including dividends) and total employee pay expenditure for
the financial years ended 31 December 2020 and 31 December 2021.

2021
2020
% change

TSR performance

500

400

300

200

100

Total
employee
expenditure

£76.4m
£70.0m
9%

Distributions to
shareholders

£22.2m
£20.1m
10%

EMIS Group total
shareholder return

FTSE SmallCap Index

Mar 12

Mar 13

Mar 14

Mar 15

Mar 16

Mar 17

Mar 18

Mar 19

Mar 20

Mar 21

Mar 22

The graph above compares the value of £100 invested in EMIS Group plc shares, including reinvested dividends, with the FTSE SmallCap Index in the
last ten years. This index was selected because it is considered to be the most appropriate against which the TSR of the Group should be measured.

EMIS Group plc | Annual report and accounts 2021

Directors’ remuneration report continued
Annual report on remuneration continued

Historical Chief Executive Officer pay
The table below details the Chief Executive Officer’s single total figure of remuneration and incentive outcomes over the relevant financial year:

Andy Thorburn (from 1 May 2017)
Chief Executive Officer single figure (£’000)
Annual bonus (% of max)
LTIP vesting (% of max)

Chris Spencer (retired 30 April 2017)
Chief Executive Officer single figure (£’000)
Annual bonus (% of max)
LTIP vesting (% of max)

2015

2016

2017

2018

2019

2020

2021

n/a
n/a
n/a

388
0%
51%

n/a
n/a
n/a

607
0%
48%

358
0%
n/a

238
0%
0%

922
72%
n/a

n/a
n/a
n/a

814
63%
10%

n/a
n/a
n/a

1,098
50%
42%

n/a
n/a
n/a

1,552
90%
70%

n/a
n/a
n/a

Percentage change in Directors’ remuneration
The table below sets out the annual percentage change in salary, benefits and bonus for each Director compared with that of the average full-time
equivalent total reward for all colleagues in the UK.

Director

Andy Thorburn
Peter Southby
Patrick De Smedt1
Andy McKeon
Kevin Boyd
Jen Byrne
JP Rangaswami
Denise Collis
Colleagues (average FTE)

% change 2020–2021

Base salary/fees

Benefits

Annual bonus

1%
1%
32%
-4%
0%
0%
n/a
n/a
5%

16%
13%
0%
0%
n/a
n/a
n/a
n/a
-4%

173%
173%
n/a
n/a
n/a
n/a
n/a
n/a
186%

1. Patrick De Smedt was appointed to the Board on 1 January 2020 as a Non-executive Director. His fee increased as at 6 May 2021 when be
became Chair.

Directors’ interests (audited)
The beneficial interests of the Executive Directors in the ordinary shares of the Company, including those acquired through the SIP, as at
31 December 2021 were as follows:

Executive Director

Andy Thorburn
Peter Southby

Ordinary shares at 31 December 2021

Fully owned and
vested shares

66,510
32,708

Unvested with
performance
conditions
(at maximum)

303,196
124,730

SIP
(unvested without
performance
conditions)

416
1,565

Since the year end, SIP shares have continued to be awarded each month, for which monthly Regulatory Information Service announcements have
been made. This has resulted in Peter Southby holding an additional 54 shares, which include matching shares awarded under the SIP which may
be subject to forfeiture in certain circumstances.

The Executive Directors have a share ownership requirement of 200% of salary for the Chief Executive Officer and 100% of salary for the Chief
Financial Officer. As of 31 December 2021, the Chief Executive Officer had achieved a shareholding of 217% of salary and the Chief Financial Officer
171% of salary and therefore both Executive Directors met the share ownership requirement. Executives are also subject to post-employment
shareholding guidelines as detailed in the remuneration policy.

The beneficial interests of the Non-executive Directors in the ordinary shares of the Company as at 31 December 2021 were as follows:

Non-executive Director

Patrick De Smedt
Kevin Boyd
Jen Byrne
JP Rangaswami
Denise Collis
Andy McKeon

EMIS Group plc | Annual report and accounts 2021

Ordinary shares
at 31 December
2021

10,000
7,000
—
—
1,441
4,947

GOVERNANCEImplementation of remuneration policy for 2022
The letter from the Chair of the remuneration committee on pages 66 and 67 includes further detail.

Base salary
The base salaries for the Executive Directors in 2022 are set out in the table below. Increases for the Executive Directors are below the budgeted
increase for the UK workforce.

Executive Director

Andy Thorburn
Peter Southby

Base salary from
1 April 2021 to
31 March 2022

Base salary from
1 April 2022 to
31 March 2023

Percentage
increase

£412,000
£272,862

£426,420
£282,412

3.5%
3.5%

Pension
For 2022, Executive Directors will continue to receive a contribution equivalent to 15% of their 2020 base salary. As of 1 January 2023, employer
pension contributions for Executive Directors as a percentage of salary will be aligned to the wider UK workforce, currently 6% of salary.

Annual bonus

The maximum bonus opportunity will be 150% of salary, with target set at 75% of base salary.

The specific targets are deemed commercially sensitive but will be published retrospectively in the annual report and accounts for 2022; 70% of
maximum opportunity will be dependent on adjusted operating profit, 12% on financial measures important to EMIS’s strategy and 18% on strategic
performance measures.

Bonus payments will continue to be delivered in cash and will continue to be subject to the following conditions:

• Clawback for a period of one year after the award in the event that the remuneration committee becomes aware of any information on the

basis of which it is reasonable for it to form the opinion that either inaccurate figures had been reported on which the bonus target had been
calculated and based or bonus outcome calculated; or there had been misconduct; or there had been any action or omission that had resulted
in significant damage to the Group’s reputation; and

• The requirement to invest at least 40% of any net bonus payment in shares of the Company until the minimum shareholding level relevant to

the Executive Director is met.

LTIP
An award will be made in 2022 and will equate to 150% of salary for the Chief Executive Officer and 100% of salary for the Chief Financial
Officer. The threshold vesting for EPS performance is 5% p.a. for this award. The performance metrics will be 75% based on EPS growth over
the performance period and 25% based on relative TSR performance against the FTSE SmallCap. The measures and weightings are unchanged
from 2021. To the extent that base target is exceeded, the percentage of award shares vesting increases pro rata between the base target and
maximum target. In assessing performance against the EPS condition, the committee will take into account any material external changes that
might impact EPS, including potential changes to the rate of corporation tax.

2022 award

Below base target
Base target
Maximum target

EPS growth

% award to vest

TSR

% award to vest

Below 5% p.a.
5% p.a.
10% p.a.

0%
18.75%
75.00%

Below median
Equal to median
Upper quartile

0%
6.25%
25.00%

Following the end of the performance period with a normal vesting period of three years, a two-year holding period applies to any vested shares.
Executive Directors are subject to the requirement to retain shares after the holding period to add to their beneficial shareholding until the
minimum shareholding level relevant to the Executive Director is met. LTIP awards are subject to clawback as explained in the policy.

SIP
Executive Directors, subject to eligibility, will be able to continue to participate in the SIP on the same basis as in 2021.

Chair and Non-executive Director fees
Fee levels for the Chair and Non-executive Directors are subject to annual review taking into account appropriate comparators and the level of
time commitment required. It was agreed that there would be base and Chair fee increases of 2% from 1 April 2022. An additional annual fee of
£8,160 will also be implemented for the Senior Independent Director from 1 April 2022.

Denise Collis
Chair of the remuneration committee
24 March 2022

EMIS Group plc | Annual report and accounts 2021

Directors’ report

This section contains the remaining matters on which the Directors
are required to report each year.

The Company is incorporated in England and Wales and domiciled in
the UK, Company number 06553923. The address of its Registered
Office is Fulford Grange, Micklefield Lane, Rawdon, Leeds LS19 6BA.

General information and principal activities
EMIS Group plc (the "Company” or the "parent company”) is an AIM-
quoted company. The Company is the parent of a number of trading
subsidiary companies. The principal trading subsidiary is Egton Medical
Information Systems Limited.

As part of a programme of corporate simplification within the
EMIS Group plc group of companies during the year, Egton Medical
Information Systems Limited acquired the trade and assets of Patient
Platform Limited on 31 May 2021, the trade and assets of Ascribe
Limited on 31 October 2021 and the trade and assets of Rx Systems
Ltd on 31 December 2021.

EMIS Group is the UK leader in connected healthcare software and
systems. Its solutions are widely used across every major UK healthcare
setting. EMIS Group’s aim is to be the leading provider of innovative
healthcare technology that improves people’s lives. This helps
healthcare professionals to deliver better, more efficient healthcare,
supporting longer and healthier lives.

EMIS Group has two core business segments: EMIS Health and EMIS
Enterprise. EMIS Health is a supplier of innovative integrated care
technology to the NHS market, including primary, community, acute
and social care. EMIS Enterprise is focussed on growth in the B2B
technology sector within the healthcare market, including management
of medicines, partner businesses, patient-facing services, data and
analytics, and research and life sciences.

EMIS Group’s brands include:

• Acquisition – the Group supplements its organic growth by acquiring
companies with promising technologies and in markets adjacent to,
and consistent with, current capabilities, such as the Edenbridge
Healthcare acquisition that took place in January 2022 and the
FourteenFish acquisition that took place in March 2022; and

• Balance sheet leverage and return of excess capital – the Group will

maintain an appropriate balance sheet, consistent with its investment
requirements and mindful of the preferences of both shareholders
and customers. While the Group is prepared to take on additional
debt if circumstances warrant, it aims to return excess capital to
shareholders when appropriate.

Dividends
Subject to shareholder approval at the AGM on 5 May 2022, the
Board proposes paying a final dividend of 17.6p per ordinary share
(2021: 16.0p) on 17 May 2022 to shareholders on the register at the
close of business on 19 April 2022. This would make a total dividend
of 35.2p per ordinary share for 2021 (2020: 32.0p).

Directors
The Directors of the Company who served during the year ended
31 December 2021 and subsequently are as follows:

Patrick De Smedt
Chair

Andy Thorburn
Chief Executive Officer

Peter Southby
Chief Financial Officer

Kevin Boyd1
Senior Independent Non-executive Director

• EMIS, the clinical software business, supplying essential technology to
10,000 healthcare organisations across every major UK health sector;

Jen Byrne
Independent Non-executive Director

• Patient, the UK’s leading independent provider of patient-centric

medical and wellbeing information and digital front door services to
the UK public;

• Pinnacle, a leading provider of service management solutions to the

community pharmacy market;

• Edenbridge Healthcare, a leading provider of business intelligence
tools for GP practices, federations and commissioners (acquired in
January 2022); and

• FourteenFish, a specialist GP appraisals and training business

(acquired in March 2022).

Capital allocation policy
EMIS Group seeks to deliver high-quality visible earnings, future
earnings growth and strong cash returns. The Board has adopted
a clear capital allocation policy:

• Reinvestment for growth – the Group invests in the infrastructure,

technology and intellectual capital to drive growth in its core
markets, through constant product innovation and integration. At the
current time, this is demonstrated by significant investment in the
EMIS-X platform;

• Regular returns to shareholders – the Group pays a regular dividend
to shareholders, representing over the medium-term around 50% of
adjusted earnings, and has increased the proposed full year dividend
for 2021 by 10%;

JP Rangaswami2
Independent Non-executive Director

Denise Collis3
Independent Non-executive Director

Andy McKeon4
Senior Independent Non-executive Director

1 Kevin Boyd became Senior Independent Director on 28 February 2022.

2 JP Rangaswami was appointed as a Non-executive Director on 1 March 2021.

3 Denise Collis was appointed as a Non-executive Director and Chair of the

remuneration committee on 1 October 2021.

4 Andy McKeon retired from the Board on 28 February 2022.

Re-election of Directors
Directors are subject to annual re-election in line with best practice.
As a new appointment since the 2021 AGM, Denise Collis will stand
for election at the AGM on 5 May 2022.

Directors’ interests
Details of Directors’ remuneration and interests in the share capital of
the Company are given in the annual report on remuneration on pages
66 to 81. Details of Directors’ service agreements are included in the
remuneration policy on page 74. No Director has had any material
interest in any contract of significance with the Company or any of its
subsidiaries during the year under review.

EMIS Group plc | Annual report and accounts 2021

GOVERNANCESubstantial interests in shares
The Company has been notified of the following substantial interests in 3% or more in its ordinary shares:

Fund Manager

Liontrust Asset Management
Octopus Investments
Heronbridge Investment Management
Evenlode Investment
MN Services
Investec Wealth and Investment
NFU Mutual
Charles Stanley

31 December 2021
%

28 February 2022
%

11.39
9.09
4.64
4.15
3.57
3.61
3.20
3.10

11.36
9.24
4.59
4.10
3.94
3.68
n/a
3.14

Research and development
Research and development expenditure in the year amounted to £21.3m
(2020: £21.2m) of which £4.1m (2020: £6.6m) was capitalised.

Share capital
As at 31 December 2021 and 16 March 2022, the Company had
63,311,396 (31 December 2020: 63,311,396) ordinary shares of 1p
each in issue. The shares are traded on AIM, a market operated by the
London Stock Exchange. The rights and obligations attached to the
shares are set out in the Company’s Articles of Association which are
available on the Company’s website.

The Company has previously established an Employee Benefit
Trust (EBT) to hold shares in the Company to facilitate share-based
emolument payments and the Group SIP. During the year, the EBT
purchased 200,000 shares in the Company at a cost of £2.4m. As at
31 December 2021 the EBT held 317,906 (2020: 401,147) ordinary
shares of 1p each. The EBT has waived its right to dividends.

Details of ordinary shares under option in respect of the Company’s
share schemes are shown in note 27 to the financial statements.

The rules of the LTIP and CSOP set out the procedure to be followed
in the event of a change of control. Further information is given in the
Directors’ remuneration policy on page 75.

Purchase of own shares
The Directors’ authority to make purchases of the Company’s shares
on its behalf is given by resolution of the shareholders annually at the
Company’s AGM.

There were no share buybacks during the year.

Directors’ indemnities and liability insurance
As permitted by the Articles of Association, in accordance with
Section 234 of the Companies Act 2006, the officers of the Company
and its subsidiaries would be indemnified in respect of proceedings which
might be brought by a third party. No cover is provided for Directors
and officers in respect of any fraudulent or dishonest actions. The
Company maintains Directors’ and officers’ liabilities insurance to provide
appropriate cover for any legal action brought against its Directors.

Employees
The Group strives to build an inclusive culture that encourages,
supports and celebrates the diverse voices of its employees. The Group
is committed to ensuring that all of its employees and prospective

employees are treated fairly and equitably. EMIS’s Dignity at Work
Policy sets out its commitment to provide a working environment that
operates on equality of opportunity and freedom from harassment or
unlawful discrimination on the grounds of race, sex, pregnancy and
maternity, marital or civil partnership status, gender reassignment,
disability, religion or beliefs, age, or sexual orientation. All employees
are treated fairly and equally.

For further information on EMIS Group employees see page 46.

Ethical business practices
The Group has a zero tolerance approach to bribery and corruption and
is committed to ensuring that it has effective processes and procedures
in place to counter the risk of bribery and corruption. A formal anti-
bribery policy is in place and training for all employees is undertaken
annually. The policy and training results are reviewed on a regular basis
by the audit committee.

The Group has a comprehensive code of ethics and standards of
business conduct document, which provides instruction and guidance
to employees on expected behaviour when dealing with a wide range
of stakeholders.

The Group has a whistleblowing policy, which is reviewed annually by
the audit committee, and an associated reporting hotline operated by
an external provider.

Along with other important policies in place across the Group, all
employees are required to acknowledge receipt of these three policies
and to confirm that they have read and understood them.

In addition, the Group has an anti-fraud policy statement and fraud
response plan which outlines the Group’s definition and attitude
towards fraud and the process to be followed in any suspected
instances of such activity.

Modern Slavery Act
The Group is committed to conducting business responsibly. It
seeks to ensure that its supply chains operate to those same high
standards, including in relation to employment practices, workplace
conditions and, more specifically, the prevention of forced,
bonded and trafficked labour. This is upheld through the Group’s
policies and processes, and is fully supported by the Board. The
steps taken to help manage the risks outlined by the legislation
are detailed in the Group’s modern slavery statement which is
published annually on the EMIS Group website and can be found
at www.emisgroupplc.com/investors/corporate-governance.

EMIS Group plc | Annual report and accounts 2021

Directors’ report continued

Political donations
No political donations were made in 2021 (2020: £nil).

Going concern
The Group’s activities and an outline of the developments taking place
in relation to its products, services and marketplace are considered in
the strategic report on pages 16 to 19. A commentary on the revenue,
trading results and cash flows is provided in the financial review on
pages 24 to 27.

Note 3 to the financial statements sets out the Group’s financial risks
and the management of capital risks.

The Group is profitable and expects to continue to be so, with
significant cash resources, a high and continuing level of recurring
revenue and also high levels of cash conversion expected for the
foreseeable future.

During the year the Group secured a new £30m revolving credit
facility with Barclays and NatWest, with an accordion arrangement to
increase it up to £60m if required. The facility is for an initial three-
year period commencing 15 December 2021 with options to extend
up to a maximum of five years. As at 31 December 2021, the facility
was undrawn.

The Directors considered the going concern assumption and after
careful enquiry and review of available financial information, including
detailed projections of profitability and cash flows for the next two
years, the Directors believe that the Group has adequate resources to
continue to operate for the foreseeable future and that it is therefore
appropriate to continue to adopt the going concern basis of accounting
in the preparation of the consolidated and Company financial statements.

AGM notice
The notice convening the AGM to be held on 5 May 2022, together
with an explanation of the resolutions to be proposed at the meeting,
is contained in a separate circular to shareholders and on the Group’s
website at www.emisgroupplc.com/investors/annual-general-meeting.

Auditor and statement as to disclosure of information
to the auditor
The Directors who were in office on the date of approval of these
financial statements have confirmed, as far as they are aware, that
there is no relevant audit information of which the auditor is unaware.
The Directors have individually confirmed that they have taken all
reasonable steps that they ought to have taken as Directors in order
to make themselves aware of any relevant audit information and to
establish that it has been communicated to the auditor.

The auditor, KPMG LLP, has indicated its willingness to be reappointed
and, in accordance with Section 489 of the Companies Act 2006, a
resolution for reappointment will be proposed at the AGM.

Corporate governance
The Company’s statement on corporate governance can be found on
pages 53 to 58 of this annual report and accounts.

The Directors’ report, comprising the strategic report, the corporate
governance report and the reports of audit, remuneration and
nomination committees, has been approved by the Board and signed on
its behalf by:

Christine Benson
Company Secretary
24 March 2022

EMIS Group plc | Annual report and accounts 2021

GOVERNANCEStatement of Directors’ responsibilities
in respect of the annual report and the financial statements

The directors have decided to prepare voluntarily a Directors’
Remuneration Report in accordance with Schedule 8 to The Large
and Medium-sized Companies and Groups (Accounts and Reports)
Regulations 2008 made under the Companies Act 2006, as if those
requirements applied to the Company. The directors have also decided
to prepare voluntarily a Corporate Governance Statement as if the
Company were required to comply with the Listing Rules and the
Disclosure Guidance and Transparency Rules of the Financial Conduct
Authority in relation to those matters.

Under applicable law and regulations, the directors are also responsible
for preparing a Strategic Report and a Directors’ Report that complies
with that law and those regulations.

The directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Company’s website.
Legislation in the UK governing the preparation and dissemination of
financial statements may differ from legislation in other jurisdictions.

We consider the annual report and accounts, taken as a whole, is fair,
balanced and understandable and provides the information necessary
for shareholders to assess the Group’s position and performance,
business model and strategy.

Signed on behalf of the Board

Andy Thorburn
Chief Executive Officer
24 March 2022

Peter Southby
Chief Financial Officer
24 March 2022

The directors are responsible for preparing the Annual Report and the
Group and parent Company financial statements in accordance with
applicable law and regulations.

Company law requires the directors to prepare Group and parent
Company financial statements for each financial year. Under the AIM
Rules of the London Stock Exchange they are required to prepare
the Group financial statements in accordance with UK-adopted
international accounting standards and applicable law and they have
elected to prepare the parent Company financial statements on the
same basis.

Under company law the directors must not approve the financial
statements unless they are satisfied that they give a true and fair view
of the state of affairs of the Group and parent company and of the
Group’s profit or loss for that period. In preparing each of the Group
and parent Company financial statements, the directors are required to:

• select suitable accounting policies and then apply them consistently;

• make judgements and estimates that are reasonable, relevant

and reliable;

• state whether they have been prepared in accordance with UK-

adopted international accounting standards;

• assess the Group and parent Company’s ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern; and

• use the going concern basis of accounting unless they either intend to
liquidate the Group or the parent Company or to cease operations, or
have no realistic alternative but to do so.

The directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the parent Company’s
transactions and disclose with reasonable accuracy at any time the
financial position of the parent Company and enable them to ensure
that its financial statements comply with the Companies Act 2006.
They are responsible for such internal control as they determine is
necessary to enable the preparation of financial statements that are
free from material misstatement, whether due to fraud or error, and
have general responsibility for taking such steps as are reasonably open
to them to safeguard the assets of the Group and to prevent and detect
fraud and other irregularities.

EMIS Group plc | Annual report and accounts 2021

Independent auditor’s report
to the members of EMIS Group plc

1. Our opinion is unmodified
We have audited the financial statements of EMIS Group plc (“the
Company”) for the year ended 31 December 2021 which comprise
the Group statement of comprehensive income, the Group and parent
Company balance sheets, The Group and parent Company statements
of cash flows, the Group and parent Company statements of changes
in equity, and the related notes, including the accounting policies
in note 1.

Overview

Materiality:
group financial
statements as a whole

Coverage

Key audit matters

New risk

Recurring risks

In our opinion:

• the financial statements give a true and fair view of the state of the

Group’s and of the parent Company’s affairs as at 31 December 2021
and of the Group’s profit for the year then ended;

• the Group financial statements have been properly prepared in

accordance with UK- adopted international accounting standards;

• the parent Company financial statements have been properly prepared
in accordance with UK- adopted international accounting standards
and as applied in accordance with the provisions of the Companies
Act 2006; and

• the financial statements have been prepared in accordance with the

requirements of the Companies Act 2006.

Basis for opinion
We conducted our audit in accordance with International Standards on
Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities are
described below. We have fulfilled our ethical responsibilities under,
and are independent of the Group in accordance with, UK ethical
requirements including the FRC Ethical Standard as applied to listed
entities. We believe that the audit evidence we have obtained is a
sufficient and appropriate basis for our opinion.

£1.8m (2020: £1.6m)
5.0% (2020: 4.5%) of Group profit before tax
(2020: Group profit before tax and exceptional
items)

80% (2020: 96%) of Group profit before tax
(2020: Group profit before tax and exceptional
items)

vs 2020

Goodwill impairment:
carrying amount of
Acute Medicines
Management cash
generating unit

Revenue recognition

Recoverability of
parent company’s
investment in
subsidiaries

EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTS2. Key audit matters: our assessment of risks of material misstatement
Key audit matters are those matters that, in our professional judgement, were of most significance in the audit of the financial statements and
include the most significant assessed risks of material misstatement (whether or not due to fraud) identified by us, including those which had the
greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These
matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters. In arriving at our audit opinion above, the key audit matters, in decreasing order of audit significance,
were as follows.

The risk

Our response

Goodwill impairment:
carrying amount of Acute
Medicines Management
cash generating unit
(Acute Medicines Management
Goodwill: £6.6 million;
2020: £6.6million)

Refer to page 98 (accounting policy)
and page 108 (financial disclosures)

Forecast-based assessment:
The carrying value of goodwill is significant
for the Group. The estimated recoverable
amount of goodwill for each of the Group’s cash
generating units, assessed with reference to
value in use calculations, is subjective due to the
inherent uncertainty involved in forecasting and
discounting future cash flows.

The impairment test for Acute Medicines
Management indicates that the headroom for this
cash generating unit is sensitive to small changes
in the assumptions and estimates applied in the
value in use calculations.

The risk is greater in this cash generating unit
due to this business not achieving its budgeted
performance for FY21.

The effect of these matters is that, as an update to
our original risk assessment, we determined that
the value in use impairment assessment for the
Acute Medicines Management cash generating
unit has a high degree of estimation uncertainty,
with a potential range of reasonable outcomes
greater than our materiality for the financial
statements as a whole.

The financial statements (note 2) disclose the
relevant estimates involved in assessing the cash
generating unit for impairment. The financial
statements (note 13) disclose the sensitivity
estimated by the Group.

We performed the tests below rather than seeking to
rely on any of the Group’s controls because the nature
of the balance is such that we would expect to obtain
audit evidence primarily through the detailed procedures
described.

Our procedures included:

• Assessing methodology: Obtaining the discounted value
in use cash flow model and assessing the methodology,
principles and integrity of the model;

• Benchmarking assumptions: Comparing the Group’s
assumptions to externally derived data in relation to
key inputs such as projected economic growth and
discount rates;

• Historical comparisons: Considering the Group’s historical

forecasting accuracy by assessing actual performance
against budget;

• Tests of detail: Assessing the achievability of

management’s FY22 budget and contracted revenues
with reference to correspondence and contractual
documentation with customers, and historic order
book trends;

• Challenge key judgements: Performing corroborative
inquiries of key sales personnel outside of the Group
finance team, to challenge the status and FY22
budget assumptions made in respect of non-recurring
revenue projects;

• Sensitivity analysis: Performing sensitivity analysis over
the value in use impairment assessment by replacing
key assumptions with alternative scenarios in order to
ascertain the extent of change in those assumptions that
either individually or collectively would be required for the
goodwill to be impaired; and

• Assessing transparency: Assessing whether the Group’s
disclosures about the sensitivity of the outcome of the
impairment assessment to changes in key assumptions
reflect the risks inherent in the valuation of goodwill for
the Acute Medicines Management cash generating unit.

EMIS Group plc | Annual report and accounts 2021

Independent auditor’s report continued
to the members of EMIS Group plc

2. Key audit matters: our assessment of risks of material misstatement continued

The risk

Our response

Revenue recognition
(£168.2 million;
2020: £159.5 million)

Refer to page 98 (accounting policy)
and page 104 (financial disclosures)

Processing error
Revenue consists of fees earned on the sale of
software, hardware and associated services.
There are a high number of contracts and
transactions and the process of recording accrued
and deferred revenue is manual in nature.

The effect of this matter is that we have to spend
a significant proportion of audit effort on this
balance which is the most material number in the
Group Statement of Comprehensive Income, and
therefore we consider this to be an area that had
the greatest effect on the audit.

Recoverability of parent
company’s investment
in subsidiaries
Investment in subsidiaries:
£112.2 million; 2020:
£106.9 million)

Refer to pages 98 and 101
(accounting policy) and page 110
(financial disclosures)

Low risk, high value:
The carrying amount of the parent company’s
investments in subsidiaries represents 66%
(2020: 70%) of the Company’s total assets.

Their recoverability is not at a high risk of
significant misstatement. However, due to their
materiality in the context of the parent company
financial statements, this is considered to be the
area that had the greatest effect on our overall
parent company audit.

Our procedures included:

• Tests of detail: Using computer assisted audit techniques

to analyse the entire population of material revenue
streams to focus on unexpected revenue transactions or
transactions with unusual attributes and assessed whether
these postings were appropriate;

• Tests of details: Assessing the appropriateness of deferred
and accrued income at the year-end with reference to the
prior year, our knowledge of the billing pattern of each
revenue stream and correspondence with customers; and

• Assessing transparency: Considering the adequacy of the
Group’s disclosures in respect of the revenue recognition
policies and revenue streams.

We performed the tests below rather than seeking to
rely on any of the Company’s controls because the nature
of the balance is such that we would expect to obtain
audit evidence primarily through the detailed procedures
described.

Our procedures included:

• Tests of detail: Comparing the carrying amount of 100%

of investments with the relevant subsidiaries’ draft balance
sheet to identify whether their net assets, being an
approximation of their minimum recoverable amount, were
in excess of their carrying amount and assessing whether
those subsidiaries have historically been profit making and
are forecast to continue to be profit making.

For the investments in subsidiary companies where
the carrying amount exceeded the net asset value, our
procedures included:

• Tests of detail: Comparing the carrying amount of

investments with an estimate of value in use based on
forecast future cashflows;

• Benchmarking assumptions: Challenging the Group’s

assumptions in relation to key inputs to the value in use
assessment such as projected growth and discount rates
to externally derived data; and

• Assessing transparency: Assessing whether the Group’s
disclosures about the sensitivity of the outcome of the
impairment assessment to changes in key assumptions
reflected the risks inherent in the valuation of investment
in subsidiaries.

EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTSGroup materiality
£1.8m (2020: £1.6m)

£1.8m
Whole financial
statements materiality
(2020: £1.6m)

£1.35m
Whole financial
statements performance
materiality (2020: £1.2m)

£1.5m
Range of materiality
at 4 components (£1.5m
- £0.3m) (2020: £1.36m
to £0.05m)

£0.09m
Misstatements reported
to the audit committee
(2020: £0.08m)

GROUP PROFIT
BEFORE TAX (2020:
GROUP PROFIT
BEFORE TAX AND
EXCEPTIONAL ITEMS)

80%

I9696+
8080+

(2020: 96%)

96
80

3. Our application of materiality and an overview of
the scope of our audit
Materiality for the Group financial statements as a whole was set at
£1.8m (2020: £1.6m), determined with reference to a benchmark of
Group profit before tax of which it represents 5.0% (2020: 4.5% of
Group profit before tax and exceptional items).

Group profit before tax
£36.1m (2020: £35.9m,
Group profit before tax and
exceptional items)

Materiality for the parent company financial statements as a whole was
set at £1.3m (2020: £1.2m), determined with reference to a benchmark
of parent company net assets of which it represents 1.2% (2020: 1.0%).

In line with our audit methodology, our procedures on individual
account balances and disclosures were performed to a lower threshold,
performance materiality, so as to reduce to an acceptable level the
risk that individually immaterial misstatements in individual account
balances add up to a material amount across the financial statements
as a whole.

Performance materiality was set at 75% (2020: 75%) of materiality for
the financial statements as a whole, which equates to £1.35m (2020:
£1.2m) for the Group and £1.0m (2020: £0.9m) for the parent company.

We applied this percentage in our determination of performance
materiality because we did not identify any factors indicating an
elevated level of risk.

9595++55++II

Group profit before tax

Group materiality

We agreed to report to the Audit Committee any corrected or
uncorrected identified misstatements exceeding £0.09m (2020:
£0.08m), in addition to other identified misstatements that warranted
reporting on qualitative grounds.

Of the Group’s 22 (2020: 22) reporting components, we subjected 4
(2020: 5) to full scope audits for group purposes.

The components within the scope of our work accounted for the
percentages illustrated opposite. The remaining 4% (2020: 1%) of total
group revenue, 20% (2020: 4%) of group profit before tax (2020: group
profit before tax and exceptional items) and 8% (2020: 5%) of total
group assets is represented by 18 (2020: 17) reporting components.
One residual component experienced an increase in revenue in the
period which also resulted in an increased level of profit before tax.
We determined that our scoping remained appropriate as no significant
risk of material misstatement was identified for this component and the
revenue from this component was not significant in the context of total
group revenues. This component represented 4.4% (2020: 1.4%) of
total group revenues, 10.7% (2020: 1.6%) of group profit before tax and
2.3% (2020: 1.1%) of total group assets.

For the remaining residual components, none individually represented
more than 7.2% (2020: 8.1%) of any of total group revenue, group profit
before tax (2020: group profit before tax and exceptional items) or total
group assets. For the residual components, we performed analysis at an
aggregated group level to re-examine our assessment that there were
no significant risks of material misstatement within these.

The work on all components subject to full scope audits for Group
purposes, including the audit of the parent Company, was performed
by the Group team using component materialities that ranged from
£1.5 million to £0.3 million (2020: £1.36 million to £0.05 million),
having regard to the mix of size and risk profile of the Group across the
components.

The scope of the audit work performed was predominately substantive
as we placed limited reliance upon the Group’s internal control over
financial reporting.

(2020: 99%)

GROUP REVENUE

96%

96+96+
969999+
I9595+
9292+

92%

(2020: 95%)

95
92

GROUP TOTAL ASSETS

Full scope for group audit purposes 2021

Full scope for group audit purposes 2020

Residual components

EMIS Group plc | Annual report and accounts 2021

4
4
+
+
I
I
+
1
+
1
+
I
I
+
8
8
+
+
I
5
+
5
+
+
I
I
+
20
20
+
+
I
+
4
+
4
+
I
I
Independent auditor’s report continued
to the members of EMIS Group plc

4. Going concern
The Directors have prepared the financial statements on the going
concern basis as they do not intend to liquidate the Group or the
Company or to cease their operations, and as they have concluded
that the Group and the Company’s financial position means that
this is realistic. They have also concluded that there are no material
uncertainties that could have cast significant doubt over their ability to
continue as a going concern for at least a year from the date of approval
of the financial statements (“the going concern period”).

We used our knowledge of the Group, its industry, and the general
economic environment to identify the inherent risks to its business
model and analysed how those risks might affect the Group’s and
Company’s financial resources or ability to continue operations over
the going concern period. The risk that we considered most likely
to adversely affect the Group’s and Company’s available financial
resources over this period was lower than expected trading volumes.

We considered whether these risks could plausibly affect the liquidity
in the going concern period by assessing the degree of downside
assumption that, individually and collectively, could result in a liquidity
issue, taking into account the Group’s current and projected cash and
facilities (a reverse stress test). We also assessed the completeness of
the going concern disclosure.

Our conclusions based on this work:

• we consider that the directors’ use of the going concern basis
of accounting in the preparation of the financial statements is
appropriate;

• we have not identified, and concur with the directors’ assessment that
there is not, a material uncertainty related to events or conditions
that, individually or collectively, may cast significant doubt on the
Group’s or Company’s ability to continue as a going concern for the
going concern period; and

• we have nothing material to add or draw attention to in relation to
the directors’ statement in note 1 to the financial statements on
the use of the going concern basis of accounting with no material
uncertainties that may cast significant doubt over the Group and
Company’s use of that basis for the going concern period, and we
found the going concern disclosure in note 1 to be acceptable.

However, as we cannot predict all future events or conditions and as
subsequent events may result in outcomes that are inconsistent with
judgements that were reasonable at the time they were made, the
above conclusions are not a guarantee that the Group or the Company
will continue in operation.

5. Fraud and breaches of laws and regulations –
ability to detect
Identifying and responding to risks of material
misstatement due to fraud
To identify risks of material misstatement due to fraud (“fraud risks”) we
assessed events or conditions that could indicate an incentive or pressure
to commit fraud or provide an opportunity to commit fraud. Our risk
assessment procedures included:

• Enquiring of directors, the audit committee, internal audit and

inspection of policy documentation as to the Group’s high-level
policies and procedures to prevent and detect fraud, including the
internal audit function, and the Group’s channel for “whistleblowing”,
as well as whether they have knowledge of any actual, suspected or
alleged fraud.

• Reading Board, audit committee and remuneration

committee minutes.

• Considering remuneration incentive schemes and performance

targets for directors.

We communicated identified fraud risks throughout the audit team and
remained alert to any indications of fraud throughout the audit.

As required by auditing standards and taking into account possible
pressures to meet profit targets and our overall knowledge of the control
environment we perform procedures to address the risk of management
override of controls, and the risk of fraudulent revenue recognition in
particular the risk that revenue is recorded in the wrong period from
subscription fees and the risk that Group management may be in a
position to make inappropriate accounting entries.

We did not identify any additional fraud risks.

We also performed procedures including:

• Identifying journal entries and other adjustments to test based

on risk criteria and comparing the identified entries to supporting
documentation for significant components. These included those
posted to unusual accounts.

• Selecting a sample of accrued and deferred revenue entries across
the Group and agreeing to supporting documentation to assess
accounting treatment was in line with relevant accounting standards.

EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTS5. Fraud and breaches of laws and regulations –
ability to detect continued
Identifying and responding to risks of material
misstatement related to compliance with laws
and regulations
We identified areas of laws and regulations that could reasonably
be expected to have a material effect on the financial statements
from our general commercial and sector experience and through
discussion with the directors and other management (as required by
auditing standards), and from inspection of the Group’s regulatory
and legal correspondence and discussed with the directors and other
management the policies and procedures regarding compliance with
laws and regulations.

We communicated identified laws and regulations throughout our team
and remained alert to any indications of non-compliance throughout
the audit.

The potential effect of these laws and regulations on the financial
statements varies considerably.

Firstly, the Group is subject to laws and regulations that directly
affect the financial statements including financial reporting legislation
(including related companies legislation), distributable profits legislation
and taxation legislation and we assessed the extent of compliance with
these laws and regulations as part of our procedures on the related
financial statement items.

Secondly, the Group is subject to many other laws and regulations
where the consequences of non-compliance could have a material
effect on amounts or disclosures in the financial statements, for
instance through the imposition of fines or litigation. We identified
the following areas as those most likely to have such an effect: health
and safety, anti-bribery, data protection, employment law and certain
aspects of company legislation. Auditing standards limit the required
audit procedures to identify non-compliance with these laws and
regulations to enquiry of the directors and other management and
inspection of regulatory and legal correspondence, if any. Therefore if a
breach of operational regulations is not disclosed to us or evident from
relevant correspondence, an audit will not detect that breach.

Context of the ability of the audit to detect fraud or
breaches of law or regulation
Owing to the inherent limitations of an audit, there is an unavoidable
risk that we may not have detected some material misstatements
in the financial statements, even though we have properly planned
and performed our audit in accordance with auditing standards.
For example, the further removed non-compliance with laws and
regulations is from the events and transactions reflected in the financial
statements, the less likely the inherently limited procedures required by
auditing standards would identify it.

In addition, as with any audit, there remained a higher risk of non-
detection of fraud, as these may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal controls. Our
audit procedures are designed to detect material misstatement. We are
not responsible for preventing non-compliance or fraud and cannot be
expected to detect non-compliance with all laws and regulations.

6. We have nothing to report on the other information
in the annual report
The directors are responsible for the other information presented in
the annual report together with the financial statements. Our opinion
on the financial statements does not cover the other information and,
accordingly, we do not express an audit opinion or, except as explicitly
stated below, any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so,
consider whether, based on our financial statements audit work, the
information therein is materially misstated or inconsistent with the
financial statements or our audit knowledge. Based solely on that work
we have not identified material misstatements in the other information.

Strategic report and directors’ report
Based solely on our work on the other information:

• we have not identified material misstatements in the strategic report

and the directors’ report;

• in our opinion the information given in those reports for the financial

year is consistent with the financial statements; and

• in our opinion those reports have been prepared in accordance with

the Companies Act 2006.

Disclosures of emerging and principal risks and
longer-term viability
We are required to perform procedures to identify whether there is
a material inconsistency between the directors’ disclosures in respect
of emerging and principal risks and the viability statement, and the
financial statements and our audit knowledge.

Based on those procedures, we have nothing material to add or draw
attention to in relation to:

• the directors’ confirmation within the viability statement that they
have carried out a robust assessment of the emerging and principal
risks facing the Group, including those that would threaten its
business model, future performance, solvency and liquidity;

• the Emerging and Principal Risks disclosures describing these risks
and how emerging risks are identified, and explaining how they are
being managed and mitigated; and

• the directors’ explanation in the viability statement of how they have
assessed the prospects of the Group, over what period they have
done so and why they considered that period to be appropriate, and
their statement as to whether they have a reasonable expectation
that the Group will be able to continue in operation and meet
its liabilities as they fall due over the period of their assessment,
including any related disclosures drawing attention to any necessary
qualifications or assumptions.

Our work is limited to assessing these matters in the context of only
the knowledge acquired during our financial statements audit. As we
cannot predict all future events or conditions and as subsequent events
may result in outcomes that are inconsistent with judgements that
were reasonable at the time they were made, the absence of anything
to report on these statements is not a guarantee as to the Group’s and
Company’s longer-term viability.

EMIS Group plc | Annual report and accounts 2021

Independent auditor’s report continued
to the members of EMIS Group plc

6. We have nothing to report on the other information
in the Annual Report continued
Corporate governance disclosures
We are required to perform procedures to identify whether there is a
material inconsistency between the directors’ corporate governance
disclosures and the financial statements and our audit knowledge.

Based on those procedures, we have concluded that each of the
following is materially consistent with the financial statements and our
audit knowledge:

• the directors’ statement that they consider that the annual report
and financial statements taken as a whole is fair, balanced and
understandable and provides the information necessary for
shareholders to assess the Group’s position and performance,
business model and strategy; or

• the section of the annual report describing the work of the Audit
Committee does not appropriately address matters communicated
by us to the Audit Committee, and how these issues were
addressed; and

• the section of the annual report that describes the review of

the effectiveness of the Group’s risk management and internal
control systems.

7. We have nothing to report on the other matters
on which we are required to report by exception
Under the Companies Act 2006, we are required to report to you if,
in our opinion:

• adequate accounting records have not been kept by the parent

Company, or returns adequate for our audit have not been received
from branches not visited by us; or

• the parent Company financial statements are not in agreement with

the accounting records and returns; or

• certain disclosures of directors’ remuneration specified by law are

not made; or

• we have not received all the information and explanations we require

for our audit.

We have nothing to report in these respects.

8. Respective responsibilities
Directors’ responsibilities
As explained more fully in their statement set out on page 85,
the directors are responsible for: the preparation of the financial
statements including being satisfied that they give a true and fair
view; such internal control as they determine is necessary to enable
the preparation of financial statements that are free from material
misstatement, whether due to fraud or error; assessing the Group and
parent Company’s ability to continue as a going concern, disclosing,
as applicable, matters related to going concern; and using the going
concern basis of accounting unless they either intend to liquidate the
Group or the parent Company or to cease operations, or have no
realistic alternative but to do so.

Auditor’s responsibilities
Our objectives are to obtain reasonable assurance about whether the
financial statements as a whole are free from material misstatement,
whether due to fraud or error, and to issue our opinion in an auditor’s
report. Reasonable assurance is a high level of assurance, but does not
guarantee that an audit conducted in accordance with ISAs (UK) will
always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually
or in aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of the financial statements.

A fuller description of our responsibilities is provided on the FRC’s
website at www.frc.org.uk/auditorsresponsibilities.

9. The purpose of our audit work and to whom we owe
our responsibilities
This report is made solely to the Company’s members, as a body, in
accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the
Company’s members those matters we are required to state to them
in an auditor’s report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone
other than the Company and the Company’s members, as a body, for
our audit work, for this report, or for the opinions we have formed.

Frances Simpson (Senior Statutory Auditor)
for and on behalf of KPMG LLP, Statutory Auditor
Chartered Accountants

1 Sovereign Square
Sovereign Street
Leeds
LS1 4DA
24 March 2022

EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTSGroup statement of comprehensive income
for the year ended 31 December 2021

Revenue
Costs:
Changes in inventories
Cost of goods and services
Staff costs
Other operating expenses1
Depreciation of property, plant and equipment
Amortisation of intangible assets

Adjusted operating profit2
Development costs capitalised
Amortisation of intangible assets3
Release of contingent acquisition consideration4

Operating profit
Finance income
Finance costs
Share of result of joint venture and associate
Other income5

Profit before taxation
Income tax expense

Profit for the period

Other comprehensive income
Items that may be reclassified to profit or loss
Currency translation differences

Other comprehensive income

Total comprehensive income for the year

Attributable to:
– equity holders of the parent
– non-controlling interest in subsidiary company

Total comprehensive income for the year

Earnings per share attributable to equity holders of the parent

Basic
Basic diluted
Adjusted
Adjusted diluted

Notes

2021
£’000

2020
£’000

168,226

159,453

9, 14
14

6
7
8
17, 18

(83)
(16,172)
(72,303)
(26,749)
(4,196)
(12,938)

43,533
4,052
(11,800)
—

35,785
50
(476)
727
—

36,086
(7,010)

29,076

(47)
(20,288)
(63,374)
(22,628)
(5,089)
(12,251)

39,266
6,590
(11,100)
1,020

35,776
89
(590)
858
782

36,915
(6,794)

30,121

(55)

(41)

29,021

30,080

29,021
—

29,021

30,207
(127)

30,080

11
11
11
11

Pence

46.2
45.6
56.1
55.5

Pence

48.1
47.6
51.0
50.4

1 Including an exceptional credit from release of contingent acquisition consideration of £nil (2020: £1,020,000).

2 For an explanation of the alternative performance measures used in this report, please refer to page 22.

3 Excluding amortisation of computer software used internally of £1,138,000 (2020: £1,151,000).

4 During the prior year the Group released £1,020,000 of contingent acquisition consideration in respect of the Dovetail acquisition resulting in a corresponding

credit to the Group statement of comprehensive income.

5 During the prior year the Group received £782,000 of previously unrecognised additional consideration in relation to the 2019 disposal of the Specialist

& Care business.

The notes on pages 97 to 118 are an integral part of these consolidated financial statements.

EMIS Group plc | Annual report and accounts 2021

Group and parent company balance sheets
as at 31 December 2021

Non-current assets
Goodwill
Other intangible assets
Property, plant and equipment
Investments
Amounts owed by subsidiary companies
Investment in joint venture and associate

Current assets
Inventories
Current tax assets
Trade and other receivables
Cash and cash equivalents

Total assets

Current liabilities
Trade and other payables
Deferred income
Other financial liabilities
Lease liabilities
Amounts owed to subsidiary companies

Non-current liabilities
Deferred tax liability
Other financial liabilities
Lease liabilities

Total liabilities

Net assets

Equity
Ordinary share capital
Share premium
Own shares held in trust
Retained earnings
Other reserve

Total equity

Group

Company

Notes

2021
£’000

2020
£’000

2021
£’000

2020
£’000

13
14
15
16

17, 18

52,177
24,358
18,694
—
—
355

52,177
33,118
19,870
—
—
353

—
722
—
112,157
—
—

—
1,466
—
106,872
10,759
—

95,584

105,518

112,879

119,097

25
28

24
25
28

26
26

530
4,730
32,057
64,042

101,359

613
3,556
29,993
53,008

87,170

—
—
6,542
49,471

—
—
5,195
29,113

56,013

34,308

196,943

192,688

168,892

153,405

(29,180)
(29,582)
(2,000)
(903)
—

(31,219)
(29,161)
(2,000)
(990)
—

(337)
—
(2,000)
—
(62,103)

(1,443)
—
(2,000)
—
(44,779)

(61,665)

(63,370)

(64,440)

(48,222)

(1,788)
—
(5,013)

(6,801)

(2,289)
(2,000)
(5,891)

(10,180)

—
—
—

—

—
(2,000)
—

(2,000)

(68,466)

(73,550)

(64,440)

(50,222)

128,477

119,138

104,452

103,183

633
51,045
(4,639)
79,699
1,739

633
51,045
(3,594)
69,260
1,794

633
51,045
—
50,555
2,219

633
51,045
—
49,286
2,219

128,477

119,138

104,452

103,183

The notes on pages 97 to 118 are an integral part of these consolidated financial statements.

The financial statements on pages 93 to 118 were approved by the Board of Directors and authorised for issue on 16 March 2022 and are signed
on its behalf by:

Andy Thorburn
Chief Executive Officer

Peter Southby
Chief Financial Officer

Company number 06553923 (England and Wales)

EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTS
Group and parent company statements of cash flows
for the year ended 31 December 2021

Profit before taxation
Finance income
Finance costs
Share of result of joint venture
Other income
Dividends received

Operating profit/(loss)
Adjustment for non-cash items
Amortisation of intangible assets
Depreciation of property, plant and equipment
Release of contingent acquisition consideration
(Profit)/loss on disposal of property, plant and equipment
Share-based payments

Operating cash flow before changes in working capital
Changes in working capital
Decrease in inventory
(Increase)/decrease in trade and other receivables
(Decrease)/increase in trade and other payables
Increase/(decrease) in deferred income

Adjusted cash generated from/(used in) operations
Development costs capitalised
Cash cost of exceptional items

Cash generated from/(used in) operations
Finance costs
Finance income
Tax paid

Net cash generated from/(used in) operating activities

Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Development costs capitalised
Purchase of software
Dividends received
Business combination
Disposal of discontinued operation, net of cash disposed of

Net cash (used in)/generated from investing activities

Cash flows from financing activities
Transactions in own shares held in trust
Payment of lease liabilities
Deferred contingent consideration
Dividends paid
Acquisition of non-controlling interest
Increase in loan from subsidiary companies
Decrease in loan from subsidiary companies
(Increase)/decrease in loan to Employee Benefit Trust

Net cash (used in)/generated from financing activities

Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

Notes

25
12

Group

Company

2021
£’000

36,086
(50)
476
(727)
—
—

35,785

12,938
4,196
—
(9)
1,788

54,698

83
(2,136)
(3,007)
421

46,007
4,052
—

50,059
(90)
26
(7,483)

42,512

(2,227)
10
(4,052)
(126)
725
—
—

(5,670)

(1,505)
(1,157)
(2,000)
(21,146)
—
—
—
—

2020
£’000

36,915
(89)
590
(858)
(782)
—

35,776

12,251
5,089
(1,020)
43
1,440

53,579

47
3,197
7,751
(436)

58,851
6,590
(1,303)

64,138
(141)
87
(11,684)

52,400

(2,449)
2,500
(6,590)
(452)
850
(2,880)
782

(8,239)

474
(1,511)
(800)
(19,860)
(555)
—
—
—

(25,808)

(22,252)

11,034
53,008

64,042

21,909
31,099

53,008

2021
£’000

19,456
(88)
123
—
—
(21,198)

(1,707)

744
—
—
—
—

(963)

—
47
(989)
—

(1,905)
—
—

(1,905)
(110)
88
—

(1,927)

—
—
—
—
21,198
—
—

21,198

412
—
(2,000)
(21,146)
—
41,728
(16,500)
(1,407)

1,087

20,358
29,113

49,471

2020
£’000

23,039
(256)
160
—
(782)
(22,650)

(489)

745
—
(1,020)
—
—

(764)

—
(211)
211
—

(764)
—
—

(764)
(115)
256
—

(623)

—
—
—
—
22,650
(3,753)
782

19,679

—
—
(800)
(19,860)
(555)
9,467
—
953

(10,795)

8,261
20,852

29,113

The notes on pages 97 to 118 are an integral part of these consolidated financial statements.

EMIS Group plc | Annual report and accounts 2021

Group and parent company statements of changes in equity
for the year ended 31 December 2021

Group

At 1 January 2020
Profit for the year
Changes in ownership interest
Non-controlling interest acquisition
Transactions with owners
Share acquisitions less sales
Share-based payments
Deferred tax in relation to share-based payments
Dividends paid (note 12)
Contingent acquisition consideration
Option over non-controlling interest
Other comprehensive income
Currency translation differences

At 31 December 2020
Profit for the year
Transactions with owners
Share acquisitions less sales
Share-based payments
Deferred tax in relation to share-based payments
Dividends paid (note 12)
Other comprehensive income
Currency translation differences

Share
capital
£’000

633
—

Share Own shares
premium held in trust
£’000

£’000

51,045
—

(5,021)
—

Retained
earnings
£’000

57,118
30,248

—

—
—
—
—
—
—

—

—
—
—
—
—
—

—

633
—

51,045
—

—
—
—
—

—

—
—
—
—

—

(406)

1,427
—
—
—
—
—

—

(3,594)
—

(1,045)
—
—
—

—
1,440
40
(19,860)
680
—

—

69,260
29,076

—
1,788
721
(21,146)

Other
reserve
£’000

147
—

—

—
—
—
—
(1,000)
2,688

(41)

1,794
—

—
—
—
—

At 31 December 2021

633

51,045

(4,639)

79,699

1,739

—

(55)

Non-
controlling
interest
£’000

Total
equity
£’000

276
(127)

104,198
30,121

(149)

(555)

—
—
—
—
—
—

—

—
—

—
—
—
—

—

1,427
1,440
40
(19,860)
(320)
2,688

(41)

119,138
29,076

(1,045)
1,788
721
(21,146)

(55)

128,477

Total
equity
£’000

95,912
23,323

1,440
(19,860)
(320)
2,688

103,183
19,720

1,788
(21,146)
907

Share
capital
£’000

633
—

—
—
—
—

Share
premium
£’000

51,045
—

—
—
—
—

633
—

51,045
—

—
—
—

Retained
earnings
£’000

43,703
23,323

1,440
(19,860)
680
—

49,286
19,720

1,788
(21,146)
907

Other
reserve
£’000

531
—

—
—
(1,000)
2,688

2,219
—

—
—
—

633

51,045

50,555

2,219

104,452

Company

At 1 January 2020
Profit for the year
Transactions with owners
Share-based payments
Dividends paid (note 12)
Contingent acquisition consideration
Option over non-controlling interest

At 31 December 2020
Profit for the year
Transactions with owners
Share-based payments
Dividends paid (note 12)
Share acquisitions less sales

At 31 December 2021

The notes on pages 97 to 118 are an integral part of these consolidated financial statements.

EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTSNotes to the financial statements
for the year ended 31 December 2021

1. Summary of significant accounting policies
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been applied
consistently to all periods presented.

1.1 Basis of preparation
The financial statements of the Group and parent company have been prepared in accordance with UK-adopted international accounting standards
in conformity with the requirements of the Companies Act 2006 (“adopted IFRS”).

For the Group statement of comprehensive income, in addition to the results presented in accordance with adopted IFRS, the Board has also
disclosed information on what it regards as the underlying performance of the business. Further details on these alternative performance
measures (APMs) are provided on page 22.

The preparation of financial statements in conformity with adopted IFRS requires the use of accounting estimates and judgements that affect the
reported amounts of assets and liabilities and of revenues and expenses. It also requires management to exercise its judgement in the application of
accounting policies. The critical accounting judgements and key sources of estimation uncertainty in the 2021 financial statements are set out in note 2.

Going concern
The Group is profitable and it is anticipated that this will continue. There is a high and continuing level of recurring revenue and high cash conversion.
The Group has an undrawn committed £30m bank facility in place until December 2024.

The Directors have prepared cash flow forecasts covering a period of at least twelve months from the date of approval of these financial
statements. These forecasts, including consideration of severe but plausible downside scenarios linked to the principal risks and uncertainties
set out in the strategic report, show the Group continuing to operate with significant cash reserves and not needing to draw on the £30m bank
facility in place (see note 22). Based on this assessment, the Directors have a reasonable expectation that the Group and Company have adequate
resources to continue in existence for at least twelve months from the date of approval of these financial statements and therefore continue to
adopt the going concern basis of accounting in preparing the annual financial statements.

1.2 Parent company statement of comprehensive income
As permitted by Section 408 of the Companies Act 2006, the parent company has not presented its own statement of comprehensive income.
The profit of the parent company for the year was £19,720,000 (2020: £23,323,000).

1.3 Changes in accounting policy and disclosure
(a) New and amended standards adopted by the Group
The Group has adopted the following new standards, amendments or interpretations in these financial statements:

• Covid-19 related Rent Concessions beyond 30 June 2021 – amendment to IFRS 16

• Interest Rate Benchmark Reform – amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16

• Extension of the Temporary Exemption from applying IFRS 9 - amendment to IFRS 4

None of these standards has had a material impact on the financial statements.

(b) Adopted IFRS not yet applied
A number of new standards, amendments or interpretations have been issued but are not mandatory for the year ended 31 December 2021
and consequently have not been applied by the Group in these financial statements. These standards are not expected to have a material
impact on the Group’s results.

• Annual Improvements to IFRS Standards 2018-2020 Cycle

• Amendments to IAS 12 - Deferred Tax related to Assets and Liabilities arising from a Single Transaction

• Amendments to IAS 8 - Definition of Accounting Estimates

• Amendments to IAS 1 and IFRS Practice Statement 2 - Disclosure of Accounting policies

• Amendments to IAS 1 - Classification of Liabilities as Current or Non-Current

• Amendments to IFRS 17 - Insurance Contracts

1.4 Basis of consolidation
The Group financial statements consolidate those of the Company and of its subsidiary undertakings drawn up to 31 December 2021.

Subsidiaries
Subsidiaries are entities over which the Company has power, to which the Company has exposure or rights to variable returns and where the Company
has an ability to use its power to affect those returns. The Group uses the acquisition method of accounting to account for business combinations.
The consideration transferred for the acquisition of a subsidiary is the fair value of the assets transferred, the liabilities incurred and the equity
interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration
arrangement. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a
business combination are measured initially at their fair value at the acquisition date. The Group recognises any non-controlling interest in the acquiree
either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net assets on an acquisition-by-acquisition basis.

The excess of the consideration transferred and the amount of any non-controlling interest in the acquiree over the fair value of the separable
identifiable net assets acquired and liabilities incurred or assumed at the acquisition date is recorded as purchased goodwill. Provision is made
for any impairment. Accounting policies previously applied by acquired subsidiaries are changed as necessary to comply with accounting policies
adopted by the Group.

EMIS Group plc | Annual report and accounts 2021

1. Summary of significant accounting policies continued
1.4 Basis of consolidation continued
Subsidiaries continued
Intra-group transactions, balances and unrealised gains and losses on transactions between Group companies are eliminated on consolidation.

In the parent company balance sheet, investments in subsidiaries are recorded at cost and are tested for impairment when there are indicators
of impairment. Any such impairment losses are recognised in the income statement in the period in which they occur.

The EMIS Group plc Employee Benefit Trust is treated as a separate legal entity within the Group consolidation.

Joint ventures and associates
A joint venture is a contractual arrangement whereby the Group and other parties undertake economic activities that are subject to “joint control”, which
means that the strategic financial and operating policy decisions relating to the relevant activities require the unanimous consent of the parties sharing
control. An associate is an entity in which the Group has significant influence, but not control or joint control, over the financial and operating policies.

Investments in joint ventures and associates are recognised in the Group financial statements using the equity method of accounting and initially
carried on the balance sheet at cost, including any transaction costs. The carrying value of investments (including any goodwill) is tested for
impairment when there is objective evidence of impairment and is stated net of any impairment loss. The Group’s share of post-acquisition profits
or losses is recognised in the Group statement of comprehensive income and its share of post-acquisition movements in reserves is recognised in
reserves. Where necessary, adjustments are made to bring the accounting policies used into line with those used by the Group.

1.5 Operating segments
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating
decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the main Board.

1.6 Revenue recognition
Revenue is recognised at the fair value of the right to the consideration received or receivable for goods sold and services provided in the normal course
of business during the year. Revenue is shown net of value added tax, returns, rebates and discounts and after eliminating sales within the Group.

The Group recognises revenue when (or as) control of goods or services passes to the customer in accordance with when distinct performance
obligations are met, and at the amount to which the Group is entitled. Specific criteria in respect of the Group’s revenue categories are described below:

• Revenue from subscription fees that contain a right to access software (non-perpetual licences for which the underlying software is not controlled
by the customer), maintenance and software support and other support services is recognised on a straight-line basis as performance obligations are
met over the period of supply. Advertising revenue generated in the Patient business is recognised as advertisements are displayed.

• Revenue from training, consultancy and system implementations, and revenue from granting a right of use of software (perpetual licences which
grant the customer control of the software), is recognised at the point in time that delivery to a customer has occurred with no significant vendor
obligations remaining and where the collection of the resulting receivable is considered probable. For long-term software installation contracts
(principally within Acute Care), revenue is recognised according to the stage of completion which is measured based on delivery of certain
milestones with observable acceptance criteria.

• In determining whether a right of use or a right of access to software has been granted, the Group considers whether the contract requires,
or the customer reasonably expects, that the Group will undertake activities that significantly affect the software to which the customer has
rights, whether those activities would impact the customer, and whether those activities would result in a transfer of a service to the customer
as they occur. If all these criteria are met, the Group deems there to have been a grant of a right of access to software and revenue is therefore
recognised over the period of supply.

• Revenue from interface and connectivity services is recognised over time, as the performance obligations are delivered. Progress is measured

using either an input method (where there are significant upfront requirements in order for the Group to deliver obligations under the contract)
or on a straight-line basis over the contract term.

• Revenue from hardware sales is recognised at the point in time when ownership passes.
• Other services revenue includes Digitisation projects for which revenue is recognised based on successful delivery of agreed milestones for both
scanning and upload activities, and Managed Service revenues which are recognised over time on a straight line basis as performance obligations
are delivered over the period of supply.

Where invoices are raised in advance of the performance obligations being satisfied, these are recorded on the balance sheet as deferred income.
This deferred income relates predominantly to services which are recognised on a straight-line basis over the period of supply. These services are
typically invoiced at the beginning of the provision of service and the associated revenue is recognised over this period. These are captured within
current liabilities on the basis that they are expected to be recognised in revenue over the next twelve months.

Where Group recognition criteria have been met but no invoice to the customer has been raised at the reporting date, revenue is recognised
and included as accrued income, within trade and other receivables.

1.7 Intangible assets
(a) Goodwill
Goodwill represents the excess of the cost of an acquisition of a subsidiary compared with the fair value at the date of acquisition of the
identifiable net assets acquired. Goodwill does not have a finite life and is not subject to amortisation. It is reviewed annually for impairment
and whenever there is an indication that there may be impairment.

Any impairment is recognised immediately in the statement of comprehensive income and is not subsequently reversed. For the purpose of
impairment testing, goodwill is allocated to those cash-generating units (CGU) or groups of cash-generating units that are expected to benefit
from the business combination and which represent the lowest level within the entity at which the goodwill is monitored for internal management
purposes. A CGU is the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows
of other assets or groups thereof.

EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTSNotes to the financial statements continuedfor the year ended 31 December 2021FINANCIAL STATEMENTS1. Summary of significant accounting policies continued
1.7 Intangible assets continued
(b) Computer software developed for external sale
Expenditure on software development is capitalised as an intangible asset if it meets the recognition criteria set out in IAS 38 Intangible Assets, requiring
it to be probable that the expenditure will generate future economic benefits and can be measured reliably. To meet these criteria, it is necessary to
be able to demonstrate, among other things, the technical feasibility of completing the intangible asset so that it will be available for use or sale.

The costs incurred in the development stage for substantially new or enhanced products are assessed against the IAS 38 criteria and considered
for recognition as an asset when they meet those criteria. These costs are generally incurred in developing the detailed product design, software
configuration and interfaces, in the coding of software, in its integration with hardware, and in its testing. Development expenditure directed towards
incremental improvements in existing products, remedial work and other maintenance activity does not qualify for recognition as an intangible asset.

Where a product is technically feasible, production and sales are intended, a market exists and sufficient resources are available to complete the
project, directly attributable development costs (only direct employee costs are assessed as directly attributable) are capitalised and subsequently
amortised on a straight-line basis over the estimated useful life, reflecting the pattern of the expected future economic benefits. Where these
conditions are not met, development expenditure is recognised as an expense in the period in which it is incurred.

Capitalised development expenditure is stated at cost less accumulated amortisation and impairment losses. The estimated useful life for development
expenditure is generally between four and six years, based on the anticipated conditions in the market from which economic benefits are expected
to be derived for each unique software product.

Development expenditure is capitalised in accordance with the criteria of IAS 38 and for this reason is not regarded as a realised loss.

(c) Other intangible assets
Intangible assets acquired in a business combination are initially recognised at their fair value. Other intangible assets are initially recognised at
cost. Intangible assets are subsequently stated at this value less accumulated amortisation and any accumulated impairment losses. Amortisation is
recognised in the statement of comprehensive income on a straight-line basis over the estimated useful life of the asset, as shown below:

Computer software used internally
Computer software acquired on business combinations
Customer relationships

4–6 years
4–8 years
10–15 years

1.8 Property, plant and equipment
Property, plant and equipment acquired with subsidiary companies is recognised at fair value at the date of acquisition. Other additions are
recognised at purchase cost. Depreciation is provided on all property, plant and equipment, other than freehold land, to write assets down to their
residual value on a straight-line basis over their estimated useful lives, as shown below:

Freehold property
Leasehold property
Computer equipment
Fixtures, fittings and equipment
Motor vehicles

50 years
Life of lease
3–6 years
4-10 years
5 years

1.9 Impairment of property, plant and equipment and intangible assets excluding goodwill
At each year-end, the Group reviews the carrying amounts of its property, plant and equipment and intangible assets to determine whether there is any
indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to
determine the extent of the impairment loss (if any). An impairment loss is recognised whenever the carrying amount of an asset, or its cash-generating
unit, exceeds the asset’s recoverable amount. Impairment losses are recognised as an expense in the Group statement of comprehensive income.

The recoverable amount of assets is the greater of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash
flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and
the risks specific to the asset. For an asset that does not generate largely independent cash inflows, the recoverable amount is determined for the
cash-generating unit to which the asset belongs.

In the current financial year no impairment losses were recognised. In relation to one project, capitalised development costs with a carrying
value of £870,000 are sensitive to future revenue forecasts, whereby a 1% reduction in future forecasted revenues would lead to a value in use
reduction of approximately £253,000, and an equivalent impairment in the asset.

1.10 Taxation
The taxation expense charged in the Group statement of comprehensive income represents the sum of the current tax expense and the deferred
tax expense.

The current tax payable is based on the taxable profit for the year. Taxable profit differs from accounting profit as reported in the Group statement
of comprehensive income because it includes or excludes items of income or expense that are taxable or deductible in other years and it further
excludes items that are never taxable or deductible. The Group liability for current tax is measured using tax rates that have been enacted or
substantively enacted by the balance sheet date.

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amount of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability
method. Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that
it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are
not recognised if the temporary difference arises from the initial recognition of goodwill or from the initial recognition (other than in a business
combination) of other assets and liabilities in a transaction which affects neither the taxable profit nor the accounting profit.

EMIS Group plc | Annual report and accounts 2021

1. Summary of significant accounting policies continued
1.10 Taxation continued
Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and associates, except where
the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the
foreseeable future.

Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled, based upon tax
rates that have been enacted or substantively enacted by the balance sheet date. Deferred tax is charged or credited in the Group statement of
comprehensive income, except when it relates to items credited or charged directly to equity, in which case the deferred tax is also dealt with in equity.

Deferred tax assets and liabilities are offset where there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax
relates to income tax levied by the same tax authorities on either:

• the same taxable entity; or

• different taxable entities which intend to settle current tax assets and liabilities on a net basis or to realise and settle them simultaneously in each

future period when the deferred tax assets and liabilities are expected to be realised or settled.

1.11 Share-based payments
The Group operates equity-settled share schemes for certain employees. The cost of share-based payments is initially measured at fair value at the
date of grant, factoring in the impact of any market-based performance conditions. Non-market-based and service-based vesting conditions are not
taken into account when estimating fair value, but are factors in determining the number of share options that will eventually vest. The fair values
are measured using the Black Scholes and Monte Carlo models. After initial measurement, fair values in relation to equity-settled schemes are not
remeasured.

The cost of equity-settled share-based payments is recognised in the Group statement of comprehensive income on a straight-line basis over
the vesting period with the corresponding amount credited to equity, based on an estimate of the number of shares that will eventually vest. The
estimate of the level of vesting is reviewed annually and the charge is adjusted accordingly in respect of non-market-based vesting conditions.

1.12 Retirement benefit costs
Contributions payable by the Group during the period into its defined contribution pension plans are recognised in the Group statement of
comprehensive income. Differences between contributions payable in the period and contributions actually paid are shown as either accruals
or prepayments in the balance sheet.

1.13 Foreign currency
Transactions in foreign currencies are translated to the respective functional currencies of Group entities at the foreign exchange rate ruling at
the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are retranslated to the
functional currency at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation are recognised in the
statement of comprehensive income. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are
translated using the exchange rate at the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are
stated at fair value are retranslated to the functional currency at foreign exchange rates ruling at the dates the fair value was determined.

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on consolidation, are translated to the Group’s
presentational currency at foreign exchange rates ruling at the balance sheet date. The revenues and expenses of foreign operations are translated at
an average rate for the year where this rate approximates to the foreign exchange rates ruling at the dates of the transactions. Exchange differences
arising from this translation of foreign operations are taken directly to the translation reserve. When a foreign operation is disposed of such that control
is lost, the cumulative amount in the translation reserve is reclassified to the statement of comprehensive income as part of the gain or loss on disposal.

1.14 Exceptional items
Exceptional items are items of income and expense which are material and, due to their nature or size, are presented separately on the face of
the income statement in order to provide a better understanding of the Group’s financial performance. Exceptional items are excluded from the
Group’s alternative performance measures (APMs), as defined on page 22.

1.15 Inventories
Inventories are stated at the lower of weighted average cost and net realisable value. Net realisable value is based upon estimated selling price less
further costs expected to be incurred to completion and disposal. Provision is made for obsolete and slow-moving items.

1.16 Own shares held in trust
The shares in the Company held by the EMIS Group plc Employee Benefit Trust are treated as treasury shares, stated at weighted average cost
and presented as a reduction of shareholders’ equity (see note 26). Gains and losses on transactions in the Company’s own shares are taken
directly to equity.

1.17 Financial instruments
Financial assets and financial liabilities are recognised in the Group balance sheet when the Group becomes a party to the contractual provisions
of the instrument.

(a) Financial assets
Trade receivables
Trade receivables are amounts due from customers for goods sold and services provided in the ordinary course of business. Trade receivables
are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for expected
credit losses. A provision for expected credit losses is established using the simplified approach under IFRS 9. Specific provisions are made against
high-risk trade receivable balances, where balances are in dispute or where doubt exists about the customer’s ability to pay.

100 EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTSNotes to the financial statements continuedfor the year ended 31 December 2021FINANCIAL STATEMENTS1. Summary of significant accounting policies continued
1.17 Financial instruments continued
(a) Financial assets continued
Investments
Investments in subsidiaries, joint ventures and associates are recorded at cost in the Company balance sheet. They are tested for impairment when
there is objective evidence of impairment. Any impairment losses are recognised in the income statement in the period they occur.

Cash and cash equivalents
In the consolidated statement of cash flows, cash and cash equivalents include cash in hand and at bank, and bank overdrafts. There are no bank
deposits with maturity dates of more than one month.

Assets held for sale
Non-current assets are classified as held for sale if it is highly probable that they will be recovered primarily through sale rather than through
continuing use. Such assets are measured at the lower of their carrying amount and fair value less costs to sell. Impairment losses on initial
classification as held for sale or held for distribution and subsequent gains and losses on remeasurement are recognised in profit or loss. Once
classified as held for sale, intangible assets and property, plant and equipment are no longer amortised or depreciated.

(b) Financial liabilities
Trade payables
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts
payable are classified as current liabilities if payment is due within one year. Trade payables are recognised initially at fair value and subsequently
measured at amortised cost using the effective interest method, where this is different to the initial recognition value.

Bank borrowings
Bank loans are recorded initially at their fair value, net of issue costs. Issue costs are charged to the Group statement of comprehensive income
over the term of the instrument at a constant rate on the carrying amount. Such instruments are subsequently carried at their amortised cost.

Equity instruments
Equity instruments issued by the Company are recorded at the fair value of the consideration received.

Contingent acquisition consideration
Consideration payable as part of the acquisition cost of a business combination is recognised at estimated fair value at the acquisition date.
Subsequent changes in the measurement of cash-settled consideration are recognised in the statement of comprehensive income. Equity-settled
consideration is not remeasured and subsequent settlement is accounted for in equity.

1.18 Dividends
Interim dividends are recognised as distributions in the accounts when paid. Final dividends are recognised in the accounts in the year in which
they are approved by shareholders.

1.19 Leases
The Group leases property, office equipment and motor vehicles. The Group is not a lessor.

At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys
the right to control the use of an identified asset for a period of time in exchange for consideration.

The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost,
which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial
direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset, less any lease incentives
received. The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using
the interest rate implicit in the lease or, if that rate cannot be readily determined, which is generally the case for leases in the Group, the Group’s
incremental borrowing rate adjusted to reflect factors specific to the lease such as the term and the type of asset leased.

The lease liability is measured at amortised cost using the effective interest method. In certain circumstances. the lease liability will be remeasured,
such as when a change in the Group’s assessment of whether it will exercise a purchase or termination option takes place. When the lease liability
is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if
the carrying amount of the right-of-use asset has been reduced to zero.

The Group presents right-of-use assets that do not meet the definition of investment property in property, plant and equipment and lease
liabilities on the face of the statement of financial position.

The Group has elected not to recognise right-of-use assets and lease liabilities for leases of low-value assets and short-term leases. The Group
recognises the lease payments associated with these leases as an expense on a straight-line basis over the lease term.

2. Critical accounting judgements and key sources of estimation uncertainty
In preparing the 2021 financial statements no significant judgements, apart from those involving estimations (which are dealt with below), have
been made in the process of applying the Group’s accounting policies.

Carrying amount of goodwill
Goodwill is reviewed annually for impairment, and whenever there is an indication that there may be an impairment, by comparing the estimated
recoverable amount of a CGU (see note 1.7 (a)) with its carrying value. The recoverable amounts of CGUs are derived from an estimated value
in use, based on discounted cash flow forecasts which require significant estimates of both future operating cash flows and an appropriate risk
adjusted discount rate. These forecasts use the following key assumptions: estimates of future non-recurring revenues, growth rates, and discount
rates. The value in use, and therefore any potential impairment to the carrying value of goodwill is sensitive to these assumptions. In respect of the
Acute Medicines Management CGU, given the relatively limited headroom of the estimated value in use over the carrying value, the assumptions
used may have a significant risk of causing a material adjustment to the carrying amount of goodwill within this CGU within the next financial year
and it is therefore deemed a key source of estimation uncertainty. Where the Directors believe a reasonably possible change in these assumptions
would cause an impairment, such as in respect of Acute Medicines Management, this has been disclosed in note 13.

EMIS Group plc | Annual report and accounts 2021

101

2. Critical accounting judgements and key sources of estimation uncertainty continued
Carrying amount of computer software developed for external sale
The carrying amount of Computer software developed for external sale is another source of estimation uncertainty. The carrying value of this
asset is significant, with a net book value of £14,661,000 at 31 December 2021 (with the largest carrying values relating to the Group’s EMIS-X,
ProScript Connect and EMIS-X Analytics products). Estimates are required with regard to the period of time over which economic benefits are
generated from it. If the useful economic life of all computer software developed for external sale was reduced by one year, the current year
amortisation charge would increase by £1,209,000 (2020: £885,000), and assets with a cost equating to approximately 8% (2020: 44%) of the
31 December 2021 net book value have not yet commenced amortisation. There were no significant changes to estimated useful economic lives
during the year. Products/software development projects are unique, with eligibility for capitalisation separately considered for each. Typically
amortisation commences when the software has been installed and is available for use, and the asset is then amortised over the period for which
software is expected to be used by the customers and markets it serves.

3. Financial risk management
3.1 Financial risk factors
The Group’s activities expose it to financial risks including credit risk, liquidity risk, interest rate risk, price risk and foreign exchange risk. The Group
manages these risks through a risk management programme that seeks to minimise potential adverse effects on the Group’s performance.

Exposure to financial risks is monitored by the finance team under policies approved by the Board and audit committee. An assessment of the risks
is provided to the Board at regular intervals and is discussed to ensure that the risk mitigation procedures are compliant with Group policy and that
any new risks are appropriately managed.

Credit risk
The Group’s credit risk is primarily attributable to its trade receivables, which are stated net of allowances for any estimated irrecoverable
amounts. However, this risk is mitigated by payment being received in advance for a significant proportion of goods and services provided.

There is some concentration of risk, as the Group trades extensively with various parties within the National Health Service. However, the Group
has long-standing relationships with these parties, which, in addition to the normal credit management processes, assist management in controlling
its credit risk.

Credit risk also arises on cash and cash equivalents placed with the Group’s banks. The Group monitors the financial standing of any institution
with which it deposits cash and has a formal treasury policy in place covering the maximum amount of cash to be placed with any one institution
and the minimum credit rating required.

Liquidity risk
Management controls and monitors the Group’s cash flow on a regular basis, including forecasting future cash flows, to ensure that it has sufficient
financial resources to meet the obligations of the Group as they fall due.

Details of the Group’s borrowings and the maturity profile of the Group’s financial liabilities are disclosed in notes 22 and 23.

Interest rate risk
The Group has limited exposure to interest rate risk with no borrowings at 31 December 2021. The Group has an undrawn £30,000,000 credit
facility in place, further details of which are disclosed in note 22.

The Group’s current assets include cash and cash equivalents at the year-end amounting to £64,042,000, on which interest received is subject to
fluctuations in market rates.

Price risk
As a significant proportion of the Group’s revenues are secured under framework agreements or other long-term contracts, it has only limited
exposure to price risk other than at the point of renegotiation of these frameworks or contracts. Where these negotiations are material, the Group,
including the Board, is fully engaged with the process in order to secure the best possible outcome.

Foreign exchange risk
The Group has limited transactional exposure arising from the purchase of services denominated in a currency other than the functional currency
of the purchasing company. The Group also has translation risk arising from the consolidation of foreign operations with functional currency that is
different to that of the Group.

3.2 Capital risk management
The Group defines the capital that it manages as the Group’s total equity, including non-controlling interests.

The Group’s objectives when managing capital are:

• to safeguard the Group’s ability to continue as a going concern, so that it can continue to provide returns to investors and benefits for other

stakeholders and to maintain an appropriate capital structure to reduce the cost of capital;

• to provide an adequate return to shareholders based on the level of risk assumed;

• to have financial resources available to allow the Group to invest in areas that may deliver future benefits and returns to shareholders and other

stakeholders; and

• to maintain financial resources sufficient to mitigate against risks and unforeseen events.

The Group is profitable and has high cash conversion with no indebtedness. As a result, capital risk is not significant for the Group and
measurement of capital management is not a tool currently used in the internal management reporting procedures of the Group.

The Group’s reserves include:

Own shares held in trust – an Employee Benefit Trust holds shares in the Company to facilitate share-based payments to employees and the
operation of the Group’s Share Incentive Plan.

Other reserve – comprises a translation reserve of foreign exchange differences from the translation of the financial statements of overseas
operations, and other reserves related to merger reliefs taken under UK law.

102 EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTSNotes to the financial statements continuedfor the year ended 31 December 2021FINANCIAL STATEMENTS4. Operating segments
IFRS 8 Operating Segments provides for segmental information disclosure on the basis of information reported internally to the chief operating
decision-maker for decision-making purposes. The Group considers that this role is performed by the main Board.

The Directors have presented segmental information to reflect the Group’s structure, activities and the markets being served. The Group has two
operating and reportable segments, both involved with the supply and support of connected healthcare software and systems:

• EMIS Health; and

• EMIS Enterprise.

Each operating segment is assessed by the Board based on an adjusted measure of operating profit, as defined in the APM section on page 22.
Group operating expenses, finance income and costs, cash and cash equivalents, and current and deferred tax are not allocated to segments, as
income tax, group and financing activities are not segment-specific.

Segmental information

Segmental result
Revenue

Segmental operating profit as reported internally
Development costs capitalised
Amortisation of development costs
Amortisation of acquired intangible assets
Release of contingent acquisition consideration

Segmental operating profit
Group operating expenses

Operating profit
Net finance costs
Share of result of joint venture and associate
Other income

Profit before taxation

Segmental assets and liabilities
Segmental assets as reported internally
Goodwill and other intangible assets

Group assets
Investment in joint venture and associate
Group cash and cash equivalents

Total assets

2021

EMIS
Enterprise
£’000

EMIS
Health
£’000

Total
£’000

EMIS
Health
£’000

2020

EMIS
Enterprise
£’000

Total
£’000

107,953

60,273

168,226

107,773

51,680

159,453

25,088
4,643
(2,559)
(3,350)
—

23,822

15,688
1,947
(1,717)
(3,474)
1,020

13,464

26,328
2,674
(4,155)
(2,787)
—

18,921
1,378
(1,972)
(2,886)
—

22,060

15,441

45,249
4,052
(6,127)
(5,673)
—

37,501
(1,716)

35,785
(426)
727
—

36,086

40,776
6,590
(4,276)
(6,824)
1,020

37,286
(1,510)

35,776
(501)
858
782

36,915

34,658
48,564

83,222

15,927
27,971

50,585
76,535

43,898

127,120

35,012
51,906

86,918

14,608
33,389

49,620
85,295

47,997

134,915

5,426
355
64,042

196,943

4,412
353
53,008

192,688

69,753

3,797

73,550

6,626
5,089
452
1,151

Segmental liabilities as reported internally

42,728

23,613

66,341

44,061

25,692

Group liabilities

Total liabilities

Other segmental information
Additions to property, plant and equipment
Depreciation of property, plant and equipment
Additions to computer software used internally
Amortisation of computer software used internally

2,125

68,466

3,198
4,196
126
1,138

2,292
3,541
100
797

906
655
26
341

2,963
3,412
349
823

3,663
1,677
103
328

Revenue excludes intra-group transactions on normal commercial terms from the EMIS Health segment to the EMIS Enterprise segment totalling
£2,115,000 (2020: £3,017,000).

Revenue of £110,910,000 (2020: £112,711,000) is derived from the NHS and related bodies.

Revenue of £3,446,000 (2020: £3,990,000) is derived from customers outside the UK. Non-current assets held outside the UK total £817,000
(2020: £959,000).

EMIS Group plc | Annual report and accounts 2021

103

5. Revenue
Revenue is analysed as follows:

Software subscription and support
Interface and connectivity charges
Other services
Perpetual licences, training, consultancy and implementation
Hardware and related services

6. Operating profit

The following have been charged/(credited) in arriving at operating profit:
Research and development expenditure
Development costs capitalised:
– Software for external sale
Depreciation of property, plant and equipment:
– Depreciation of owned assets
– Depreciation of leased assets
Amortisation of intangible assets:
– Computer software used internally
– Computer software developed for external sale
– Arising on business combinations
Exceptional release of contingent acquisition consideration
Operating lease rentals:
– Land and buildings
– Plant, machinery and motor vehicles

EMIS
Health
£’000

79,024
5,411
10,495
7,272
5,751

2021

EMIS
Enterprise
£’000

25,479
18,945
5,775
5,150
4,924

Total
£’000

104,503
24,356
16,270
12,422
10,675

EMIS
Health
£’000

77,032
5,023
7,795
5,124
12,799

107,953

60,273

168,226

107,773

2020

EMIS
Enterprise
£’000

22,456
15,261
5,602
3,859
4,502

51,680

Total
£’000

99,488
20,284
13,397
8,983
17,301

159,453

2021
£’000

2020
£’000

21,288

21,166

(4,052)

(6,590)

3,169
1,027

1,138
6,127
5,673
—

92
74

3,636
1,453

1,151
4,276
6,824
(1,020)

193
75

The total research and development cost shown above of £21,288,000 (2020: £21,166,000) principally relates to relevant staff and directly
related costs. Software development costs amounting to £4,052,000 (2020: £6,590,000) have been capitalised in accordance with the criteria set
out in IAS 38.

Total fees payable by the Group during the year to KPMG LLP in respect of the audit and other services provided were as follows:

Audit of these financial statements
Amounts payable to the Company’s auditor and associated companies in respect of:
– Audit of the financial statements of subsidiaries of the Company
– All other services (including half year review)

2021
£’000

231

100
36

367

2020
£’000

200
25

265

104 EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTSNotes to the financial statements continuedfor the year ended 31 December 2021FINANCIAL STATEMENTS7. Finance income

Bank interest
Foreign exchange gain

8. Finance costs

Interest payable and bank fees
Interest on lease liabilities
Amortisation of bank loan issue costs

9. Employees
The average monthly number of people (including Directors) employed by the Group during the year was as follows:

Management and administration
Software support and development
Sales, maintenance and training
Others

Staff costs were:

Wages and salaries
Social security costs
Pension costs – defined contribution plans
Share Incentive Plan (note 27)
Share option expense (note 27)

Dealt with as follows:
Charged in Group statement of comprehensive income
Capitalised in the development of software for external sale

2021
£’000

26
24

2021
£’000

92
351
33

476

2021
Number

90
1,051
295
72

1,508

2021
£’000

63,916
7,590
2,893
168
1,788

76,355

72,303
4,052

76,355

2020
£’000

88
1

2020
£’000

139
386
65

590

2020
Number

92
1,138
294
55

1,579

2020
£’000

59,701
6,123
2,600
100
1,440

69,964

63,374
6,590

69,964

EMIS Group plc | Annual report and accounts 2021

105

10. Income tax expense

Income tax:
– UK current year tax charge
– Overseas current year tax charge
– Adjustment in respect of prior years

Total current tax

Deferred tax:
– UK current year
– Adjustment in respect of prior years
– Deferred tax rate change

Total deferred tax

Total tax charge in Group statement of comprehensive income

Factors affecting the tax charge for the year
Profit before taxation

Taxation at the average UK corporation tax rate of 19% (2020: 19%)
Tax effects of:
– Expenses/(income) not allowable/(chargeable) in determining taxable profit
– Adjustment in respect of prior years
– Joint venture reported net of tax
– Effect of overseas tax rates
– Deferred tax rate change

Tax charge for the year

2021
£’000

2020
£’000

7,508
148
(452)

7,204

(899)
441
264

(194)

7,159
184
(656)

6,687

(792)
685
214

107

7,010

6,794

36,086

6,856

36,915

7,014

64
(11)
(138)
(25)
264

(315)
29
(163)
15
214

7,010

6,794

In March 2021 the UK government announced that the UK corporation tax rate for large companies would rise to 25% from 1 April 2023.
Following the substantive enactment of the Finance Bill 2021 on 24 May 2021, this change resulted in a one-off deferred tax charge of £264,000
in the period, with a corresponding increase in the Group’s net deferred tax liability.

11. Earnings per share (EPS)
The calculation of basic and diluted EPS is based on the following earnings and numbers of shares:

Earnings

Profit for the period
Total comprehensive income attributable to non-controlling interest

Basic earnings attributable to equity holders
Development costs capitalised
Amortisation of development costs and acquired intangible assets
Release of contingent acquisition consideration
Other income
Tax and non-controlling interest effect of above items

Adjusted earnings attributable to equity holders

Weighted average number of ordinary shares

Total shares in issue
Shares held by Employee Benefit Trust

For basic EPS calculations
Effect of potentially dilutive share options

For diluted EPS calculations

106 EMIS Group plc | Annual report and accounts 2021

2021
£’000

29,076
—

29,076
(4,052)
11,800
—
—
(1,472)

35,352

2021
Number
‘000

63,311
(335)

62,976
745

63,721

2020
£’000

30,121
127

30,248
(6,590)
11,100
(1,020)
(782)
(925)

32,031

2020
Number
‘000

63,311
(447)

62,864
634

63,498

FINANCIAL STATEMENTSNotes to the financial statements continuedfor the year ended 31 December 2021FINANCIAL STATEMENTS11. Earnings per share (EPS) continued

EPS

Basic
Basic diluted
Adjusted
Adjusted diluted

12. Dividends

Final dividend for the year ended 31 December 2019 of 15.6p
Interim dividend for the year ended 31 December 2020 of 16.0p
Final dividend for the year ended 31 December 2020 of 16.0p
Interim dividend for the year ended 31 December 2021 of 17.6p

2021
Pence

46.2
45.6
56.1
55.5

2021
£’000

—
—
10,066
11,080

21,146

2020
Pence

48.1
47.6
51.0
50.4

2020
£’000

9,798
10,062
—
—

19,860

A final dividend for the year ended 31 December 2021 of 17.6p amounting to approximately £11,082,000 will be proposed at the Annual General
Meeting on 5 May 2022. If approved, this dividend will be paid on 17 May 2022 to shareholders on the register on 19 April 2022. The dividend
is not accounted for as a liability in these financial statements and will be accounted for as an appropriation of distributable reserves in the year
ending 31 December 2022.

13. Goodwill

Group

Cost
At 1 January 2020
Acquisition of business

At 31 December 2020
Reallocation

At 31 December 2021

Accumulated impairment losses
At 1 January 2020, 31 December 2020 and 31 December 2021

Net book value
At 31 December 2021
At 31 December 2020
At 1 January 2020

EMIS
Health
£’000

EMIS
Enterprise
£’000

Total
Group
£’000

41,810
—

41,810
1,622

43,432

22,342
4,208

26,550
(1,622)

24,928

64,152
4,208

68,360
—

68,360

8,825

7,358

16,183

34,607
32,985
32,985

17,570
19,192
14,984

52,177
52,177
47,969

During the year, in response to the Group’s continuing technology development and investment in key areas such as interoperability, elite partners,
data, and analytics, and reflecting both the matrix organisational structure and the programme of corporate simplification (see page 82), the Partners
& Analytics CGU was combined with the Primary and Community CGU. At the point of transfer, Goodwill of £1,622,000 previously allocated to
Partners & Analytics was tested for impairment. The result of this test was that no impairment was necessary.

Impairment tests for goodwill
Goodwill relates predominantly to the value of synergies arising from business combinations and the experience of staff within acquired businesses.
Goodwill is allocated to the Group’s cash-generating units (CGUs) that are expected to benefit from that combination based on the relative carrying
values of other acquired intangible assets.

EMIS Group plc | Annual report and accounts 2021

107

13. Goodwill continued
The carrying amount of goodwill is allocated to CGUs as follows:

Primary, Community, Partners & Analytics
Acute NHS
Community Pharmacy
Acute Medicines Management
Pinnacle

2021
£’000

23,479
11,128
6,756
6,606
4,208

52,177

2020
£’000

23,479
11,128
6,756
6,606
4,208

52,177

Each allocation of goodwill is tested annually for impairment and, to confirm whether an impairment of the goodwill is necessary, management
compares the carrying value to the value in use.

The value in use for each allocation of goodwill has been calculated using pre-tax cash flows from internal budgets for the year ending 31 December 2022
to forecast pre-tax cash flows from each CGU (with the key budget assumptions being in relation to revenue growth). These cash flows have then
been extrapolated for a further four years assuming average annual growth rates of 3.5% (2020: 3.5%) until 31 December 2026 and then 1% into
perpetuity (2020: 1%) for all CGUs. The pre-tax cash flows have been discounted back to 31 December 2021 using a discount rate of between
10.1% and 11.1% (2020: 10.1% to 11.1%). The exercise has confirmed that there has been no impairment in any CGU.

Management has determined the discount rates for each CGU by considering the specific risks relating to the relevant segment. Growth rates
beyond the budget period are determined based on a prudent assessment of long-term growth rates.

The key assumptions underpinning the value in use calculation are discount rate, revenue growth and operating margins. Sensitivity analysis has
been performed on the key assumptions which indicated that, with the exception of Acute Medicines Management, no reasonably possible change
to these key assumptions would cause an impairment.

The carrying value of the Acute Medicines Management CGU is £7,031,000 (including £6,606,000 of Goodwill). The estimated recoverable
amount exceeded the carrying value by £2,862,000 and therefore the Directors concluded no impairment was necessary. However, the
recoverable amount is sensitive to reasonably possible changes in the forecast levels of non-recurring revenue, and the discount rate applied.
If forecast non-recurring revenues for 2022 were reduced by 50%, to a level broadly consistent with 2021, with the impact of this reduction
reflected in all subsequent years, and no related cost savings realised, an impairment of £2,954,000 would be required. It is expected that any
deterioration in non-recurring revenues would also lead to a reduction in future costs. The expected future cost reduction has not been factored
into the sensitivity analysis. If the discount rate was increased by 1% to 11.1%, and all other assumptions were unchanged, this would reduce the
recoverable amount of the CGU by £985,000, and a discount rate of 13.8% would result in a recoverable amount which was comparable to its
carrying value.

14. Other intangible assets

Group

Cost
At 1 January 2020
Additions
Acquisition of business

At 31 December 2020
Additions

At 31 December 2021

Accumulated amortisation and impairment
At 1 January 2020
Charged in year

At 31 December 2020
Charged in year

At 31 December 2021

Net book value
At 31 December 2021
At 31 December 2020
At 1 January 2020

108 EMIS Group plc | Annual report and accounts 2021

Computer
software

Computer
software
used developed for

Computer
software
acquired on
business
external sale combinations
£’000

£’000

internally
£’000

7,798
452
—

8,250
126

8,376

5,167
1,151

6,318
1,138

7,456

920
1,932
2,631

Customer
relationships
£’000

30,984
—
962

31,946
—

Total
£’000

137,221
7,042
3,951

148,214
4,178

31,946

152,392

22,721
2,412

25,133
2,107

102,845
12,251

115,096
12,938

27,240

128,034

4,706
6,813
8,263

24,358
33,118
34,376

58,098
6,590
—

64,688
4,052

68,740

43,676
4,276

47,952
6,127

54,079

14,661
16,736
14,422

40,341
—
2,989

43,330
—

43,330

31,281
4,412

35,693
3,566

39,259

4,071
7,637
9,060

FINANCIAL STATEMENTSNotes to the financial statements continuedfor the year ended 31 December 2021FINANCIAL STATEMENTS14. Other intangible assets continued
The accounting policy for intangible assets is set out in note 1.7. The remaining average amortisation period for software developed for external
sale is five years. At 31 December 2021 software acquired on business combinations had a remaining amortisation period of two years for
Dovetail, and five years for Pinnacle. Customer relationships have a remaining amortisation period of two years with the exception of Indigo 4
Systems (three years) and Pinnacle (five years).

Company intangible assets comprise computer software developed for external sale with a cost of £3,729,000 (2020: £3,729,000) and accumulated
amortisation of £3,007,000 (2020: £2,263,000).

15. Property, plant and equipment

Group

Cost
At 1 January 2020
Additions
Acquisition of business
Disposals
Effect of movements in exchange rates

At 31 December 2020
Additions
Remeasurement of lease asset
Disposals
Effect of movements in exchange rates

At 31 December 2021

Accumulated depreciation and impairment
At 1 January 2020
Charged in period
On disposals
Effect of movements in exchange rates

At 31 December 2020
Charged in period
On disposals
Effect of movements in exchange rates

At 31 December 2021

Net book value
At 31 December 2021
At 31 December 2020
At 1 January 2020

Land and
buildings
£’000

Computer
equipment
£’000

Fixtures.
fittings and
equipment
£’000

Motor
vehicles
£’000

10,816
3,651
151
(1)
(204)

14,413
18
—
(273)
(43)

16,907
1,805
—
(1,299)
(45)

17,368
2,665
—
(1,096)
(10)

14,115

18,927

1,510
1,320
—
(22)

2,808
942
(273)
(13)

3,464

10,651
11,605
9,306

11,033
2,700
(1,251)
(27)

12,455
2,461
(1,096)
(4)

13,816

5,111
4,913
5,874

3,653
479
31
—
(3)

4,160
505
—
(403)
—

4,262

1,324
495
—
(1)

1,818
386
(403)
—

1,801

2,461
2,342
2,329

Total
£’000

32,863
6,626
204
(1,328)
(252)

38,113
3,198
(142)
(1,796)
(53)

39,320

14,464
5,089
(1,260)
(50)

18,243
4,196
(1,796)
(17)

1,487
691
22
(28)
—

2,172
10
(142)
(24)
—

2,016

597
574
(9)
—

1,162
407
(24)
—

1,545

20,626

471
1,010
890

18,694
19,870
18,399

EMIS Group plc | Annual report and accounts 2021

109

16. Investments

Company

At 1 January 2020
Acquisition of non-controlling interest
Capital contribution
Acquisition of business

At 31 December 2020
Capital contribution

At 31 December 2021

£’000

96,813
555
1,751
7,753

106,872
5,285

112,157

During the year the Company made a capital contribution to Patient Platform Limited in respect of the capitalisation of an intra-group receivable
balance of £5,285,000. During the prior year the Company made a capital contribution to Dovetail Digital Limited in respect of the capitalisation
of an intra-group receivable balance of £1,751,000.

Investments are tested for impairment annually, or when their is an indicator of impairment at the reporting date. Recoverable amount is calculated
based on the value in use of the asset, which is assessed using estimated future cash flows discounted to present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to that asset. In the current financial year no
impairment losses were recognised.

The undertakings whose results and financial position are consolidated within the Group financial statements for the year ended 31 December 2021
are as follows:

ASC Computer Software (NZ) Limited
ASC Computer Software PTY Limited
Ascribe Group Limited
Ascribe Holdings Limited
Ascribe Limited
Ascribe Limited (Kenya)1
Dovetail Digital Limited
Egton Limited1
Egton Medical Information Systems Limited
EMIS Health Community Pharmacy Limited1
EMIS Health India Private Limited
EMIS Health Limited1
Footman Walker Associates Limited1
Healthcare Gateway Limited
Patient Platform Limited
Protechnic Exeter Limited1
Rx Systems Limited
Pinnacle Systems Management Limited
Pinnacle Health Partnership LLP
Scroll Bidco Limited

1 Dormant.

2 Held directly by EMIS Group plc.

% of issued
ordinary
incorporation shares held

Country of

New Zealand
Australia
England & Wales
England & Wales
England & Wales
Kenya
England & Wales
England & Wales
England & Wales
England & Wales
India
England & Wales
England & Wales
England & Wales
England & Wales
England & Wales
England & Wales
England & Wales
England & Wales
England & Wales

100
100
100 2
100
100
100
100 2
100 2
100 2
100 2
100 2
100 2
100
50
100 2
100
100 2
100 2
100 2
100

The above subsidiary undertakings which are not dormant are engaged in providing software and support services to the healthcare market, with
the exception of Ascribe Group Limited, Scroll Bidco Limited and Ascribe Holdings Limited which are all holding companies.

All undertakings incorporated in England and Wales, with the exception of Healthcare Gateway Limited, have a Registered Office of Fulford
Grange, Micklefield Lane, Rawdon, Leeds LS19 6BA. The Registered Office of Healthcare Gateway Limited is Unit 3 Rawdon Park, Green Lane,
Leeds LS19 7BA.

Other Registered Offices are as follows: ASC Computer Software (NZ) Limited, Suite 6035, 17b Farnham Street, Parnell, Auckland 1052, New
Zealand; ASC Computer Software PTY Limited, Level 22, 567 Collins Street, Melbourne, Victoria, Australia 3000; Ascribe Limited (Kenya), PO
Box 40296 – 00100, Nairobi, Kenya; and EMIS Health India Private Limited, Unit No. A1, Level 3, Shriram The Gateway SEZ, No. 16, G.S.T. Road,
Perungalathur, Chennai-600 063, India.

110

EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTSNotes to the financial statements continuedfor the year ended 31 December 2021FINANCIAL STATEMENTS17. Investment in joint venture
Healthcare Gateway Limited (HGL) is a joint venture with In Practice Systems Limited. Its purpose is to enable the sharing of patient data via a
medical interoperability gateway.

The Group has a 50% interest in the ordinary share capital of HGL, acquired on formation for £1.

Aggregate amounts relating to HGL are as follows:

Revenues

Profit before taxation
Profit after taxation

Non-current assets
Current assets
Current liabilities

Net assets

Group’s interest in net assets of investee at beginning of year
Share of total comprehensive income
Dividends received

Group’s interest in net assets of investee at end of year

2021
£’000

4,133

1,756
1,423

48
2,294
(2,033)

309

163
712
(725)

150

2020
£’000

4,391

2,119
1,716

—
2,328
(1,992)

336

155
858
(850)

163

18. Investment in associate
On 20 May 2019 EMIS Group plc acquired a 10% shareholding in Adheradata Limited (Adhera), a privately owned organisation offering a complete
dispensing business management solution. The shareholding is in line with the Group’s strategy of identifying sustainable long-term market opportunities
delivering connected healthcare systems. The Group’s interest in Adhera has been accounted for as an associate because the Group has determined
that it has significant influence due to having the right to meaningful representation on its board of directors.

The following table analyses the carrying amount and share of profit of Adhera:

Carrying amount of investment in associate

Share of total comprehensive income

19. Trade and other receivables

Trade receivables and other receivables
Accrued income
Prepayments
Loan to Employee Benefit Trust

2021
£’000

205

2020
£’000

190

—

Group

Company

2021
£’000

18,108
7,310
6,639
—

32,057

2020
£’000

16,439
7,389
6,165
—

29,993

2021
£’000

55
—
641
5,846

6,542

2020
£’000

190
—
566
4,439

5,195

Prepayments include unamortised bank fees of £20,000 (2020: £37,000). The loan to the Employee Benefit Trust is non-interest-bearing and is
repayable on demand.

EMIS Group plc | Annual report and accounts 2021

111

20. Credit quality of financial assets
The amounts of the maximum exposure to credit risk at the reporting date are as follows:

Trade receivables and other receivables
Cash at bank

No collateral security is held.

Trade receivables and other receivables
Reporting date balances fall within the following categories:

UK governmental health bodies
Community pharmacies and associated wholesalers
Other third party receivables

Group

Company

2021
£’000

18,108
64,042

82,150

2020
£’000

16,439
53,008

69,447

2021
£’000

55
49,471

49,526

2020
£’000

190
29,113

29,303

Group

2021
£’000

11,542
3,660
3,894

19,096

2020
£’000

8,921
4,438
3,581

16,940

Trade and other receivables are mainly due one month following the date of the invoice. At the reporting date the aged analysis of trade and other
receivables (based on invoice date) is as follows:

December
November
October and earlier

Gross carrying amount

Impairment provision

Net carrying amount

Group

2021
£’000

8,442
4,208
6,446

2020
£’000

8,857
3,506
4,577

19,096

16,940

(988)

(501)

18,108

16,439

During the year a provision for impairment of £487,000 was created (2020: £38,000), and utilisation of the provision amounted to £nil (2020: £180,000).

Cash at bank
The Group’s cash is held with a number of different banks. The Moody’s long-term credit ratings of those banks and the respective balances held
are as follows:

Aa3
A1
A3
Baa1
Baa2
Baa3

Group

2021
£’000

889
60,369
—
—
275
2,509

64,042

2020
£’000

627
30,090
19,972
1,533
786
—

53,008

112

EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTSNotes to the financial statements continuedfor the year ended 31 December 2021FINANCIAL STATEMENTS21. Trade and other payables

Trade payables
Accrued expenses
Other tax and social security

Group

Company

2021
£’000

4,543
17,533
7,104

29,180

2020
£’000

5,692
12,244
13,283

31,219

2021
£’000

87
250
—

337

2020
£’000

153
1,290
—

1,443

22. Borrowings
At 31 December 2021, the Group had available undrawn bank facilities of £30,000,000 committed until December 2024. An accordion
arrangement is in place to increase the quantum up to £60,000,000. Unamortised bank fees of £20,000 (2020: £37,000) have been presented
within prepayments in trade and other receivables. The financial covenants in place for these facilities are adjusted EBITA interest cover and net
debt to adjusted EBITDA leverage. All covenants were comfortably met during the year and are projected to be met for the remaining period of the
facilities.

23. Liquidity risk
The following are the contractual maturities of the Group’s financial liabilities, including estimated interest payments:

Carrying
amount
£’000

Contractual
cash flow
£’000

Less than
1 year
£’000

1–2 years
£’000

2–5 years
£’000

More than
5 years
£’000

At 31 December 2021
Trade and other payables due within one year
Contingent acquisition consideration
Lease liabilities

At 31 December 2020
Trade and other payables due within one year
Contingent acquisition consideration
Lease liabilities

24. Deferred tax

Group

At 1 January 2020
Credited/(charged) to statement of comprehensive income
Credited to equity
Acquisition of business
Effect of movements in exchange rates

At 31 December 2020
(Charged)/credited to statement of comprehensive income
Credited to equity
Other Balance Sheet reclassification
Effect of movements in exchange rates

At 31 December 2021

29,180
2,000
5,916

37,096

31,219
4,000
6,881

42,100

29,180
2,000
7,543

38,723

31,219
4,000
8,903

44,122

29,180
2,000
1,217

32,397

31,219
2,000
1,347

34,566

—
—
1,011

1,011

—
2,000
1,149

3,149

—
—
2,303

2,303

—
—
2,627

2,627

Property,
plant and
equipment
£’000

Intangible
assets
£’000

Other
temporary
differences
£’000

1,121
656
—
—
—

1,777
(906)
—
(412)
—

459

(3,471)
(443)
—
(753)
—

(4,667)
168
—
—
—

(4,499)

883
(320)
40
—
(2)

601
932
721
—
(2)

2,252

—
—
3,012

3,012

—
—
3,780

3,780

Total
£’000

(1,467)
(107)
40
(753)
(2)

(2,289)
194
721
(412)
(2)

(1,788)

EMIS Group plc | Annual report and accounts 2021

113

24. Deferred tax continued
Certain deferred tax assets and liabilities have been offset. The following is the analysis of the deferred tax balances (before offset) for financial
reporting purposes:

Deferred tax liabilities
Deferred tax assets

Net deferred tax liability

25. Other financial liabilities

Company and Group

Current
Contingent acquisition consideration – Pinnacle

Non-current
Contingent acquisition consideration – Pinnacle

2021
£’000

(4,499)
2,711

(1,788)

2020
£’000

(4,667)
2,378

(2,289)

2021
£’000

2020
£’000

2,000

—

2,000

The current contingent consideration liability in respect of the Pinnacle acquisition is due for cash settlement in 2022 following the achievement of
specified profit targets. Estimated fair value has been measured based on the expected future amounts payable, as the impact of discounting is not
material. This has been categorised as a level 3 fair value measurement under IFRS 13, as the inputs to the valuation, such as the performance of
Pinnacle, are not based on observable market data.

During the year a payment of £2,000,000 was made, and a liability of £2,000,000 was reclassified from non-current to current liabilities.

26. Share capital and share premium

Company and Group

At 1 January 2020, 31 December 2020 and 31 December 2021

Ordinary shares of 1p each

Number

63,311,396

£’000

633

Share
premium
£’000

51,045

All issued shares are fully paid. At 31 December 2021 the EMIS Group plc Employee Benefit Trust held 317,906 shares in the Company (2020:
401,147 shares).

During the year the Employee Benefit Trust acquired 200,000 shares, representing 0.3% of the issued share capital of the Company, for total
consideration of £2,403,000.

During the year the Employee Benefit Trust disposed of 283,241 shares, representing 0.4% of the issued share capital of the Company, for total
consideration of £898,000.

The maximum number of shares held by the Employee Benefit Trust during the year was 401,147, representing 0.6% of the issued share capital of
the Company.

114

EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTSNotes to the financial statements continuedfor the year ended 31 December 2021FINANCIAL STATEMENTS27. Share-based payments
At 31 December 2021 outstanding awards to subscribe for ordinary shares of 1p each in the Company, granted in accordance with the rules of the
EMIS Group share option schemes and the EMIS Group LTIP (including the EMIS Group Restricted Stock Award), were as follows:

Date of grant

2011 Share Option Plan
21 April 2017
20 April 2018
24 April 2019
2 April 2020
7 April 2021

Weighted average exercise price

EMIS Group LTIP
21 April 2017
1 May 2017
4 September 2017
20 April 2018
6 November 2018
3 April 2019
24 April 2019
24 June 2019
9 September 2019
2 April 2020
18 September 2020
7 April 2021
7 October 2021

At
1 January
2020

37,530
66,804
70,808
—
—

175,142

972p

130,465
44,518
21,953
232,271
156,995
22,643
304,176
439,781
21,061
—
—
—
—

Granted

Lapsed

Exercised

At
31 December
2020

Granted

Lapsed

Exercised

At
31 December
2021

—
—
—
97,920
—

97,920

980p

(37,530)
(8,790)
(11,356)
(9,945)
—

(67,621)

941p

— (120,483)
(39,978)
—
(19,714)
—
(57,811)
—
(4,400)
—
—
—
(44,308)
—
(64,071)
—
—
—
(12,702)
390,669
(3,097)
30,094
—
—
—
—

—
—
—
—
—

—

(7,287)
—
—
—
—
—
—
—
—
—
—
—
—

—
58,014
59,452
87,975
—

205,441

985p

2,695
4,540
2,239
174,460
152,595
22,643
259,868
375,710
21,061
377,967
26,997
—
—

—
—
—
—
82,125

82,125

1,140p

—
(879)
(9,352)
(16,830)
(8,541)

—
(49,224)
—
—
—

—
7,911
50,100
71,145
73,584

(35,602)

(49,224)

202,740

1,053p

853p

1,068p

—
—
—
—
—
—
— (101,583)
(88,809)
—
(13,178)
—
(11,349)
—
(14,745)
—
—
—
(33,265)
—
(13,143)
—
(22,400)
261,229
—
8,015

(1,670)
(4,540)
(2,239)
(67,629)
(61,487)
—
—
—
—
—
—
—
—

1,025
—
—
5,248
2,299
9,465
248,519
360,965
21,061
344,702
13,854
238,829
8,015

1,373,863

420,763

(366,564)

(7,287) 1,420,775

269,244

(298,472)

(137,565) 1,253,982

Weighted average exercise price

EMIS Group Restricted
Stock Award
7 April 2021
7 October 2021

Weighted average exercise price

—
—

—

—
—

—

—
—

—

—
—

—

—
—

—

92,009
4,006

96,015

(11,169)
—

(11,169)

—
—

—

80,840
4,006

84,846

The number of vested options which had not been exercised at 31 December 2021 was 25,948 (2020: 9,474). The weighted average share price at
the date of exercise for share options exercised in 2021 was £12.48 (2020: £10.32).

The parent company operates share option schemes, the HMRC-approved EMIS Group plc 2011 Share Option Plan, an LTIP scheme and
Restricted Stock Awards. Tranches of options have been granted at market value to senior members of management under the 2011 Share Option
Plan, and at nil-cost under the LTIP and Restricted Stock Award scheme. Performance conditions apply to all outstanding awards for the 2011
Share Option Plan and the LTIP scheme. The Restricted Stock Award is not subject to any performance conditions.

All options are conditional on the employee completing three years’ service, other than in certain limited circumstances. The Group has no legal or
constructive obligation to repurchase or settle any of the options for cash.

The key assumptions used in the valuation of share options granted during the year are shown on page 116. The fair values of options are
determined using the Black Scholes model, with the impact of any market-based performance conditions determined using a Monte Carlo
simulation.

EMIS Group plc | Annual report and accounts 2021

115

27. Share-based payments continued

Grant date

Exercise period

Share price at grant date
Exercise price
Expected volatility
Expected life (years)
Risk-free rate
Expected dividend yield
Fair value per option

2011 Share
Option Plan

EMIS Group
LTIP

EMIS Group
RSA

7 April
2021
April
2024
–April
2026
1,140p
1,140p
27%
3
0.17%
2.81%
159p

7 April
2021
April
2024
–April
2031
1,140p
0p
27%
3
0.17%
2.81%
1,048p

7 October
2021
April
2024
–April
2031
1,354p
0p
21%
2.5
0.57%
2.48%
1,257p

7 April
2021
April
2022
–April
2031
1,140p
0p
27%
1
0.01%
2.81%
1,108p

7 April
2021
April
2023
–April
2031
1,140p
0p
27%
2
0.07%
2.81%
1,078p

7 April
2021
April
2024
–April
2031
1,140p
0p
27%
3
0.17%
2.81%
1,048p

7 October
2021
April
2022
–April
2031
1,354p
0p
21%
0.5
0.33%
2.48%
1,321p

7 October
2021
April
2023
–April
2031
1,354p
0p
21%
1.5
0.48%
2.48%
1,288p

7 October
2021
April
2024
–April
2031
1,354p
0p
21%
2.5
0.57%
2.48%
1,257p

The expected volatility assumption is based on statistical analysis of the historical volatility of the Company’s share price.

The Company also operates an HMRC-approved Share Incentive Plan, which is open to all UK employees with at least six months’ service. Those
joining contribute a maximum of the lower of £1,800 a year or 10% of salary. These contributions are used to acquire shares in the Company
at market price from the EMIS Group plc Employee Benefit Trust, which holds shares in the Company to satisfy Share Incentive Plan and other
employee share scheme requirements.

For every two (2020: three) shares acquired by an employee the Company adds one free matching share. The matching shares, together with free
shares allocated to members under the scheme during the year, had a value of £663,000 (2020: £594,000).

116

EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTSNotes to the financial statements continuedfor the year ended 31 December 2021FINANCIAL STATEMENTS28. Leases
The Group leases property, office equipment and motor vehicles. Leases for vehicles typically run for a period of four years, property leases for
between five and fifteen years, and office equipment for between five and six years.

Some property leases contain extension options or break clauses exercisable by the Group and not by the lessors. The Group reassesses whether
it is reasonably certain to exercise the options if there is a significant change in circumstances.

Set out below are the carrying amounts of the Group’s right-of-use assets and lease liabilities and the movements during the period:

As at 1 January 2020
Additions
Acquisition of business
Depreciation expense
Interest expense
Payments
Effect of movements in exchange rates

As at 31 December 2020
Additions
Remeasurement of lease asset and liability
Depreciation expense
Interest expense
Payments
Effect of movements in exchange rates

As at 31 December 2021

Right-of-use assets

Land and
buildings
£’000

Fixtures,
fittings and
equipment
£’000

Motor
vehicles
£’000

2,639
3,422
151
(858)
—
—
(140)

5,214
—
—
(615)
—
—
(28)

4,571

46
—
—
(32)
—
—
—

14
—
—
(14)
—
—
—

—

886
659
—
(563)
—
—
—

982
10
(142)
(398)
—
—
—

452

Total
£’000

3,571
4,081
151
(1,453)
—
—
(140)

6,210
10
(142)
(1,027)
—
—
(28)

5,023

Lease
liabilities

£’000

(3,934)
(4,081)
(156)
—
(386)
1,508
168

(6,881)
(10)
142
—
(351)
1,157
27

(5,916)

Amounts recognised in the statement of comprehensive income are set out below:

Interest on lease liabilities
Expenses relating to short-term leases
Expenses relating to leases of low value

The total cash outflow for all leases (including short-term and low value) is shown below:

Total cash outflow for leases

2021
£’000

351
166
3

2020
£’000

386
266
2

2021
£’000

1,326

2020
£’000

1,776

29. Capital commitments
At 31 December 2021 the Group had capital commitments principally in respect of fixtures, fittings, and equipment amounting to £99,000 (2020:
£604,000).

30. Pension commitments
Pension contributions of £2,893,000 (2020: £2,600,000) represent contributions paid on behalf of employees by the Group to various defined
contribution schemes.

EMIS Group plc | Annual report and accounts 2021

117

31. Related party transactions
Key management compensation
Key management includes Executive and Non-executive Directors and members of the Group Executive Team. The compensation paid or payable
to key management for employee services is shown below:

Key management

Salaries and other short-term employee benefits
Share-based payments
Termination payments
Post-retirement benefits

Directors’ emoluments

Aggregate emoluments
Pension costs – defined contribution plans

2021
£’000

4,859
939
250
189

6,237

2021
£’000

2,812
66

2,878

2020
£’000

3,803
1,026
—
187

5,016

2020
£’000

1,403
67

1,470

Retirement benefits are accruing to two (2020: two) Directors under defined contribution personal pension schemes. Aggregate emoluments
includes gains on exercise of share options of £761,000 (2020: £29,000).

Highest paid Director

Aggregate emoluments
Pension costs – defined contribution plans

2021
£’000

1,557
62

1,619

2020
£’000

635
61

696

Aggregate emoluments includes a gain on exercise of share options of £563,000 (2020: £nil). The remuneration of the Directors of EMIS Group
plc is set out in detail in the Directors’ remuneration report on pages 69 to 81, with the disclosures required under AIM Rule 19 and Schedule 5
shown as audited.

Other related party transactions

Transactions between the Group and:

Joint venture – Healthcare Gateway Limited
Sales of goods and services in year
Amounts owed by related party at year-end

2021
£’000

83
58

2020
£’000

127
—

Transactions between Company and subsidiaries
The Company enters into transactions with its subsidiary undertakings in respect of internal funding and the provision of certain services which
are procured by the Company. Such services are recharged based on the utilisation by the subsidiary undertaking. The amounts outstanding
from subsidiary undertakings to the Company at 31 December 2021 totalled £nil (2020: £10,759,000). Amounts owed by the Company at 31
December 2021 totalled £62,103,000 (2020: £44,779,000).

The Company and certain subsidiary undertakings have given guarantees in support of the Group’s banking facility, a revolving credit facility of
£25,000,000 and an overdraft facility of £5,000,000.

32. Subsequent events
On 14 January 2022, the Group completed the acquisition of 100% of the share capital of Edenbridge Healthcare Limited, a leading provider of
business intelligence tools for GP practices, federations and commissioners. It will expand the Group’s capabilities in the growing analytics markets
by providing real time insight to support GP practice access, efficiency, transformation and workforce planning. EMIS Group acquired the business
for £4,000,000 in cash paid from the Group’s existing cash resources, with further cash consideration of up to £6,000,000 payable on the
attainment of certain performance targets.

On 1 March 2022 the Group completed the acquisition of 100% of the share capital of FourteenFish Limited, bringing a specialist knowledge of
GP medical appraisals and training into the business. FourteenFish is the chosen training system of the Royal College of General Practitioners
(RCGP) and will join EMIS to strengthen the Group’s training proposition. The Group acquired the business for £15,848,000 in cash paid from the
Group’s existing resources.

The Group is undertaking an exercise to establish the fair value of the net assets acquired, however due to the timing of the acquisitions the
results of this have not been included in the financial information set out in this preliminary announcement.

118

EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTSNotes to the financial statements continuedfor the year ended 31 December 2021FINANCIAL STATEMENTSFINANCIAL STATEMENTS
FINANCIAL STATEMENTS

Five-year Group financial summary

Revenue
Recurring revenue1

Reported operating profit
Adjusted operating profit1

Profit before tax

Earnings per share – basic
Earnings per share – adjusted1

Dividends payable to Company’s shareholders in respect of year
Dividends per ordinary share

Total equity

Reported cash generated from operations
Adjusted cash generated from operations1
Net cash/(debt)1

Average number of employees

1 The Group’s alternative performance measures (APMs) are defined on page 22.

2021
£’000

2020
£’000

2019
£’000

2018
£’000

2017
£’000

168,226
134,809

159,453
130,043

159,507
124,969

170,070
140,681

160,354
133,537

35,785
43,533

36,086

46.2p
56.1p

22,162
35.2p

35,776
39,266

36,915

48.1p
51.0p

20,128
32.0p

26,827
39,273

27,071

36.0p
51.4p

19,593
31.2p

28,740
37,608

29,170

36.1p
47.4p

17,896
28.4p

10,640
37,406

10,937

12.8p
47.2p

16,245
25.8p

128,477

119,138

104,198

102,659

108,014

50,059
46,007
64,042

1,508

64,138
58,851
53,008

1,579

50,059
46,332
31,099

1,666

49,873
54,469
15,620

2,024

48,834
49,652
13,991

1,906

EMIS Group plc | Annual report and accounts 2021

119

Shareholder information

Internet
The Group’s investor page can be found at
www.emisgroupplc.com/investors. This site is regularly updated to
provide information about the Group. In particular, the share price and
all of the Group’s press releases and announcements can be found
on the site. The annual report and accounts will be published on
www.emisgroupplc.com/investors/financial-reporting-and-presentations.
The maintenance and integrity of the website is the responsibility of the
Directors. The auditor does not consider these matters.

Payment of dividends
Shareholders may find it more convenient to make arrangements to
have dividends paid directly into their bank account. The advantages of
this are that the dividend is credited to a shareholder’s bank account on
the payment date, there is no need to present cheques for payment and
there is no risk of cheques being lost in the post. To set up a dividend
mandate or to change an existing mandate, please contact Link Group,
whose details are opposite.

Registrar
Any enquiries concerning your shareholding should be addressed to
the Company’s registrar. The registrar should be notified promptly
of any change in a shareholder’s address or other details at Link
Group, 10th Floor, Central Square, 29 Wellington Street, Leeds
LS1 4DL, tel. 0371 664 0300; calls are charged at the standard
geographic rate and will vary by provider. If you are outside the
UK, please call +44 371 664 0300. Calls outside the UK will
be charged at the applicable international rate. The registrar is
open between 9.00am and 5.30pm, Monday to Friday excluding
public holidays in England and Wales. The registrar’s website is
www.signalshares.com. This will give you access to your personal
shareholding by means of your investor code which is printed on your
share certificate or statement of holding.

Shareholder security
Shareholders are advised to be wary of any unsolicited advice, offers to
buy shares at a discount, or offers of free reports about the Company.
Details of any share dealing facilities that the Company endorses will
be included in Company mailings or on our website. More detailed
information can be found at www.moneyadviceservice.org.uk.

You can find out more information about investment scams, how
to protect yourself and report any suspicious telephone calls
to the Financial Conduct Authority (FCA) by visiting its website
(www.fca.org.uk/scamsmart/resources) or contacting the FCA
on 0800 111 6768.

Dividend Reinvestment Plan (DRIP)
The Company will be introducing the option for shareholders to invest
dividends in a Dividend Reinvestment Plan (DRIP) from May 2022. The
DRIP will be included as an option for all future dividends declared.
To find out more and check eligibility to join the DRIP, please visit
www.signalshares.com.

The DRIP allows shareholders to reinvest dividend payments in
purchasing the Company’s shares. For participants in the DRIP, each
time a dividend is paid, Link Market Services Trustees Limited (Link) will
purchase additional shares on their behalf to the value of their dividend.
The purchase is of shares already in issue and is made direct from the
open market.

Share dealing services
The sale or purchase of shares must be done through a stockbroker
or share dealing service provider. The London Stock Exchange
provides a “Locate a broker” facility on its website which gives
details of a number of companies offering share dealing services.
For more information, please visit the private investors section at
www.londonstockexchange.com. Please note that the Directors of
the Company are not seeking to encourage shareholders to either
buy or to sell shares. Shareholders in any doubt about what action to
take are recommended to seek financial advice from an independent
financial adviser authorised pursuant to the Financial Services and
Markets Act 2000.

Share price information
The latest information on the share price is available at
www.emisgroupplc.com/investors/shareholder-information.

Board
Executive Directors
Andy Thorburn
Chief Executive Officer

Peter Southby
Chief Financial Officer

Non-executive Directors
Patrick De Smedt – Chair

Kevin Boyd – Senior Independent
Non-executive Director

Jen Byrne – Independent Non-
executive Director

Denise Collis – Independent Non-
executive Director

JP Rangaswami – Independent
Non-executive Director

Company Secretary
Christine Benson

Company number
06553923 (England and Wales)

Nominated adviser
and broker
Numis Securities Limited
45 Gresham Street
London
EC2V 7BF

Registered Office
Fulford Grange
Micklefield Lane
Rawdon
Leeds LS19 6BA

Auditor
KPMG LLP
1 Sovereign Square
Sovereign Street
Leeds LS1 4DA

Registrar
Link Group
10th Floor, Central Square
29 Wellington Street
Leeds LS1 4DL

Financial PR
MHP Communications
60 Great Portland Street
London W1W 7RT

Tax adviser
Deloitte LLP
1 City Square
Leeds LS1 2AL

Remuneration adviser
Mercer Limited
1 Tower Place West
Tower Place
London EC3R 5BU

Legal advisers to
the Company
Pinsent Masons LLP
1 Park Row
Leeds LS1 5AB

Schofield Sweeney LLP
Church Bank
Bradford BD1 4DY

DAC Beachcroft LLP
St Pauls House
23 Park Square South
Leeds LS1 2ND

120 EMIS Group plc | Annual report and accounts 2021

FINANCIAL STATEMENTSHGL

HMRC

Healthcare Gateway Limited

Her Majesty’s Revenue & Customs

IAS

ICO

ICS

IFRS

IPO

ISO

KPI

LPI

LTIP

MSD

NCSC

NHS

NHSX

NIC

NIMS

NISD

NCSC

NSS

Raas

RCGP

R&D

RMC

SAFe

s.172

SECR

SIP

TCFD

TRE

TSR

UEL

Human Resources

International Accounting Standard

Information Commissioner’s Office

Integrated Care System

International Financial Reporting Standards

Information Governance

Initial Public Offering

International Organisation For Standardization

Key Performance Indicator

Learning and Performance Institute

Long-Term Incentive Plan

Merck Sharp & Dohme

National Cyber Security Centre

National Health Service

An NHS organisation focussed on the digital
transformation of care

National Insurance Contribution

National Immunisation Management System

Networks and Information Systems Directive

National Cyber Security Centre accreditations

National Services Scotland

Ransomware as a service

Royal College of General Practitioners

Research and Development

Risk Management Committee

Scaled Agile Framework

Section 172 Companies Act 2006

Streamlined Energy & Carbon Reporting
Requirements

Share Incentive Plan

Task Force on Climate related Financial Disclosures

Trusted Research Environment

Total Shareholder Return

Useful Economic Life

UNSDG

United Nations Sustainability Development Goals

Glossary

A&E

AGM

AIM

APM

B2B

CCG

CEO

CGU

CISO

Code

COPI

CPD

CSOP

CSRA

DHCW

DHSC

EBITA

EBITDA

EBT

EMIS

Accident & Emergency

Annual General Meeting

Artificial Intelligence

Alternative Investment Market

Alternative Performance Measure

Business-to-business

Clinical Commissioning Group

Chief Executive Officer

Cash-Generating Unit

Chief Information Security Officer

UK Corporate Governance Code 2018

Control of Patient Information

Continued professional development

Company Share Option Plan

Control and Risk Self-Assessment

Digital Health and Care Wales

Department of Health and Social Care

Earnings before interest, tax and amortisation

Earnings before interest, tax depreciation
and amortisation

Employee Benefit Trust

Egton Medical Information Systems

EMIS Enterprise

EMIS business areas where revenues are
predominantly from private sector sources
in healthcare business-to-business

EMIS Health

EMIS business areas where revenues are generated
from NHS organisations

EMIS Web

Market leading GP clinical software

EMIS-X

Cloud based platform

EMIS-X Analytics A suite of data analytics tools

Earnings Per Share

Environmental, social and governance

Fast Healthcare Interoperability Resource

Financial Reporting Council

Financial Times Stock Exchange

General Data Protection Regulations

General Practitioner

Group Executive Team

EPS

ESG

FHIR

FRC

FTSE

GDPR

GXT

CBP011649

EMIS Group plc

Registered Office
Fulford Grange
Micklefield Lane
Rawdon
Leeds LS19 6BA

Tel: 0330 024 1269
www.emisgroupplc.com