Cegedim SA (ALCGM) Earnings Call Transcript & Summary

Good morning, and good evening, everyone, and thank you for joining us to discuss Cegedim full year 2020 earnings. Before we begin, I would like to remind you that this presentation and conference call may constitute forward-looking statements. These forward-looking statement may include comments about our guidance and expectation and our prospects and are based of today, March 18, 2021. For additional information concerning important factors that could cause our results to differ materially from expectation and underlying assumption, please refer to our universal registration document, specifically Chapter 7, on risk management. With this in mind, please turn to Page 3 of this presentation. So Cegedim today, this is a company with roughly EUR 500 million of revenue, 5,300 employees present in more than 10 countries and the percentage of revenue from the healthcare space is more than 84%. We are mostly present in Europe, as you may see on the slide, with some presence in Chile from hospitals but also we have some services center and R&D center in Romania, Egypt and Morocco. We have 4 divisions and as of now we are presenting our activities -- our businesses by activities and not by the client, so by activity. So the first division is Software and Services, 56% of revenue. This is all activity related to software, so based on license and SaaS and internet services, et cetera for healthcare professional in France, Spain, U.K., Belgium and Italy and Romania for health insurance company in France and U.K. and for HR department in France. Then we have the flow activity. This is 16% of our revenue. This is digitalization of processes and invoices in the healthcare and other sectors. For the healthcare, we do this only in France and for other sectors we do this in France, U.K. and Germany. Then by having software and flows, we -- I want to collect some data. So we have the Data and Marketing division that is 18% of our revenue. So this is a European health database used by health authorities, doctors, governments, pharma companies in Germany, France, Italy, Spain, Romania and U.K. We also do digital and print marketing at pharmacy in France. So we put the poster in front of the French pharmacies or we can put TV screen in pharmacy or outside pharmacy, and we also do digital marketing for French doctors. And the last division is BPO activities. This is 10% of our revenue. This is the outsourcing of the claim processing system for health insurance companies in France and for some HR department in France also. So this is our divisions. And we are unique, leading integrated player in the health care field with a unique ecosystem. As you may see, our clients are governments, health authorities, hospital, pharma company, payers, allied health professionals, pharmacies, researchers, care providers and the patient also. And we offer them different services that help them connect together, exchange information, make payment, electronic healthcare record, referral, medication database, exchange data, agenda, prescription, diagnosis, teleconsultation et cetera. So we're offering to most of the players in the healthcare field, most of the solutions that they need to be efficient on providing healthcare. So how we go through the crisis in 2020? So first, about people. So the telework deployment -- have been deployed in all countries during lockdown. So the first and the second one. We have limited recourse to partial unemployment, and this is mostly for advertisement at the French pharmacies in France and hiring have been postponed when possible. And we have been able to deploy this very quickly and to maintain the quality of services to our clients because we have our own data center with the robust network and secure datacenter. On the financial point of view, travel reception, marketing have been reduced, of course. We have some postponement on social payment. We have a robust financial situation, as you will see in a few minutes. Reasonable leverage, as we see also in the next slide. No debt maturing before October 2024. We have a completely undrawn revolver facility of EUR 65 million, and our overdraft facilities are also in use and this is an amount of EUR 24 million. The recurring revenue, as you'll see in few minutes. As I explained before, we are predominately in the healthcare sector. During this crisis, we have done everything. We continued to maintain a strong level of innovation, and product development plans have been continued as planned. There was no change in our development solution and innovation, as we'll see in a few minutes also. So what's happened? So the rebound started right after the first lockdown. So you see that at the beginning of the year, the first quarter would have been up by 3.3% on a like-for-like basis. Then came at end of March, the second lockdown and we've been down by 8% on revenue on like-for-like. The 2 main reasons for this decrease of 8% is our activity at pharmacies during the April month have been completely closed. So we have no -- absolutely no activity at advertisement at pharmacy in April. The second, some projects have been postponed from 2020 to 2021. Why? Because some company came and say, okay, you need to implement your solution. However, there is nobody at the office. So please do it later and later and later means it's 2021. And the last point is the use of health care by French residents have been decreased. So less people go to doctors during lockdown to hospitals, et cetera. So we also have the decrease from the less users of healthcare. So this is why we've been down by 8%. And so at the end of the first half, we've been down by 2.5%, and our recurring operating income have been divided by 2. Then after the lockdown in the third quarter, we see a rebound by 1.9% and an acceleration in Q4, even if we have the second lockdown in France and in other countries by an increase of 2.3%. So at the end of the year, our revenue is slightly stable, minus 0.2%, and our recurring operating income increased by 11.8%. So 63% of the recurring operating income have been generated in the second half of the year. And if we look at the margin, during the first half, our margin on recurring working income have been 2.7%. And in the second half, our margin is 13.3 -- 13.5%. So the global -- for the full year we have 8.3% that we have generated 63% of our recurring operating income in the second half. So we continue, as I mentioned before, our investment in R&D. So if we take all the salary for R&D people relative to our revenue. This is 14.9%. We capitalized EUR 50.8 million, and we have 100 -- 1,338 employees on our R&D team. And all of these numbers are up compared to last year. So now if you look at the big picture for 2020, so revenue down by 1.4% on a reported basis and minus 0.2% on a like-for-like basis. Recurring operating income increased by 11.8%. So the margin came from 7.3% to 8.3% to EUR 41.5 million. Free cash flow from operations significantly increased, as we'll see in some slides later. This is coming mostly from the working capital requirement, and the working capital requirement increased because we have some postponement of social payments. And as a mathematical result of the free cash flow increase, our net debt decreased. And as you may see, as I mentioned, reasonable leverage. We came from a leverage of 2.1 to 1.6, and the net debt is EUR 164.2 million, excluding IFRS 16. So on the revenue, the difference between reported and organic is coming from the fact we have made the disposal of [ Pulse ] assets, and we have made acquisition of NetEDI and Cosytec. So in global, we have a structural impact of minus 1%. If we look by division, what happened on terms of revenue, you see that on the first division, Software and Services, we started the year by 3.4% more and then a decrease in the second quarter, and this decrease is coming from the weakness in project activity. So as I mentioned, some of the projects have been postponed to 2021, mostly on the Health Insurance segment. And then following this first lockdown, with the rebound of activity, and it's coming from mostly because we have the recurring activity on these businesses. On the flow business, as you may see, as said, the year started not so bad with 0.8% then a decrease in the second quarter. This decrease is coming from the fact that during the lockdown, there is a decrease in use of the healthcare. So you see this in the second quarter, and you see this in last quarter, Q4 also, but they rebound in Q3. Of course, this has been partially -- the decrease is lower-than-expected because also we have an increase of invoicing for all kind of sectors. So on this, we have invoices for the Healthcare segment, to [indiscernible] payment for healthcare. That is down. But on the same time, we have on the invoicing business, and this is a mix of these 2 activity. On Data & Marketing, you'll see that in the second quarter, we're down and other quarter are very strong. And the reason why we are very strong is because we're selling more data to pharma company because they want -- would like to understand better how the COVID-19 impacted their businesses. In the second quarter, the reason we are down is coming from the fact that there few media activity. Advertisements at pharmas in France have been completely closed during the April month. On the BPO business, this increased by 3.9% over the quarter. Just the fact that it seems there is a decrease in the increase of [indiscernible], I would say, the reason for that is a negative base effect because we have signed a big contract in Q4 2019. So of course, you have the base effect that explains this slightly change in -- increase by quarters. Recurring operating income trend. So you see that we started with EUR 37.1 million. And we have revenue that came down by EUR 6.8 million. We have the payroll cost that increased by EUR 6.5 million. The reason for the increase on the payroll is the fact that we have the full effect in 2020 for the hiring that we have done in 2019. So of course, when you hired people in 2019, we have the full impact in 2020. Then external expenses decreased by roughly EUR 15 million, the main impact is, of course, a reduction in marketing, in traveling, in reception and in external employees. Purchases used decreased a little bit because revenue decreased and we'll see later why we have a small change in depreciation. So at the end, if we look, we have recurring operating income of EUR 41.5 million, margin of 8.3%. If we look quickly by division, so Software and Services, as we have seen, a revenue decrease on a like-for-like basis by 0.7%, but recurring operating income increased by 21.1%, and the margin came from 6.8% to 8.5%. The reason for that is mostly because we have recurring activities on these businesses. Most of our clients on a SaaS model, so a monthly payment [ that will ] happen. And the second impact for this positive increase of recurring operating income, it's coming from the fact that we have made the disposal of Pulse, and Pulse has been loss-making. So this is the reason. And the loss-making of Pulse was related to the fact that we have a huge investment on R&D. So disposal of Pulse plus recurring activity explained why recurring operating income significantly increased. On the second division, Flow. A decrease of revenue, so decrease in operating income, decrease in margin is just a very high fixed business cost. So we have a very high fixed cost on these businesses. And as we have seen a decrease in use of healthcare there is now more decrease on recurring operating income. Data & Marketing. Increase of revenue, increase of recurring operating income and increase of margin despite the fact that we have our advertisement business closed for 1 month. And then the BPO increase of revenue and what is interesting, we have been loss-making on the businesses in 2019, and we are breakeven in 2020 and the most -- the main reason for that is that we have improved our processes for BPO activity. If we look on the P&L. So we have already seen most of the fact. We'll see in few minutes D&A and other not-recurring expenses. We see that the cost of financial debt is quite stable compared to last year. The main reason for that, that we are mostly on the fixed rate debt at this stage. And you have a decrease in total taxes. The decrease is due to the decrease in deferred taxes due to R&D depreciation as we'll see in few minutes. So on D&A, and you see, I would say, maintenance D&A is quite stable. D&A of right of use related to IFRS-16, stable. And D&A of R&D is decreased by [ 5.8% ]. And the reason for the decrease is on the slide is because we have some softer depreciation. So the stock of R&D have decreased and D&A also [ materially ] decreased. So other nonrecurring or exceptional items, you see that last year, the main part of that was impact from disposal of Pulse. It was mostly a write-off of software. But the reason for that was because we have decided to make the disposal. And this year, the most important part of disposal recurring income and expenses is software depreciation of EUR 15 million. This is all software that is no longer used, mostly on the license based. Now as we move to SaaS, of course, we have to depreciate all software. If we look on the balance sheet, nothing really special to mention. All figures are roughly the same as last year. If you look at the free cash flow. So these are the free cash flow before taxes, and interest rate a bit increased. The corporate tax paid, little a bit increased. However, acquisition of intangible assets, acquisition of tangible assets and disposal of tangible and intangible assets are roughly the same numbers as last year. So the main impact of the income from the change in working capital requirements that have been negative last year and it's positive by EUR 18.5 million. Of this the EUR 18.5 million, EUR 14 million is related to social payment postponement. So this is payment that normally should happen in 2020. Due to government law, we have been able to postpone it and make payment in 2021. So this is why the working capital requirement is positive of 18.5%. So net debt, we have EUR 180.6 million. So this is before IFRS 16 impact. Free cash flow from operations, then we have acquisition, we have made an acquisition of Clamae Group, so EUR 6.1 million less cash. Then we have lease payment, of course. We have interest paid, EUR 5.3 million. So we came to EUR 164.2 million of net debt, this is a leverage of 1.6. The outlook for 2021. 2020 revenue came down by 0.2% on a like-for-like basis and recurring operating income increased by 11.8%. Our outlook for 2021 is to see revenue up by around 2% and recurring operating income increased by around 4%. The Cegedim's equity story, it's very simple. It's a solid business model. Innovation is very important, that's [indiscernible]. We have a long-standing shareholder support and entrepreneurial culture with a unique integrated healthcare ecosystem and product on SaaS. So this came with strong recurring revenue base, as you have seen in few minutes, stable customer base and we are uniquely positioned to drive digitalization of the economy and mostly from the healthcare segment. The next event will be in April 27 Q1 2021 revenue. In addendum and you will see the bridge from reported and like-for-like businesses. You will see also the bridge from sectors that we have reported before and divisions. So you can find how this net numbers came in and just for revenue and for recurring operating income. So this is the end of this presentation. And now we are open to any questions that you may have.

[Operator Instructions]

Okay. This is Pierre Marucchi. Maybe I can answer to Patrick for some questions about the '21 organic growth. So this is a very careful scheme. We have built it on the fact that we do not -- we have no -- we do not have any knowledge about how the epidemia -- what will be the evolution of the epidemia and the risk of having another lockdown in France. What we see since the beginning of the year is that in the division, Software & Services, there are still a lot of big projects which are postponed. And that's the reason why we have forecast no growth on this department. On the year '21. Looking at the division, Flow. We are still in a situation where in France people are not going to pharmacists to buy drugs as -- at the same level as before the epidemia. Therefore, all the flows linked to the healthcare reimbursement system that we are managing are going down. And we still see that since the beginning of the year. So we may have this year or at least for the first half, an evolution where the growth of the [ e-business ] department, which is a [ a materialization ] of Flows, will be compensated by the fact that the reimbursement system in France is having less and less flows. And we have the same in the BPO department where we have 2 sections. We are making the BPO for insurance companies, health insurance companies. So we have the same effect. People are less going to see their doctors, and then the doctors are less prescribing than before. And then what we are managing in terms of BPO is decreasing. The other part is from the HR department. We are making the BPOs of some of our clients. And the risk there is the fact that there will be reductions of people in our clients. And if we are managing less people in -- with our systems, then we are billing less. So the unique division where we feel comfortable in terms of growth is data marketing where we think that we should be not far from 10% of 2-digit growth. That's where we have had the best evolution during the second half. The data we are selling to the pharmaceutical companies and the data we are giving for free to the government, are really more and more asked by our clients. So the result of that is that we come to a 2% figure, which is what we have in our head today. Of course, we see a lot of newspaper saying that the second half should be marvelous for everyone in Europe. We have not taken any assumptions on this rebound on the second half. And that's the reason why the figure, we think, is very careful, but we are not able to build other assumptions.

Well, another question from Antoine Lensel. On the savings made thanks to the COVID-19, mainly travels and marketing, how many of it could become structural? Are you able to quantify it? On travel expenses in 2020, we have done a savings of around EUR 5 million. And we expect, of course, to 2021 to be able to save some of this, so nearly half of it. As, of course, we are very careful on travelers, and we have changed a little bit our policy on traveling. And people are more cautious and the deployment of Zoom and video conferencing, et cetera, also are able to save some travelings. So part of this savings made in 2020 on travels we'll be able to see it again in 2021 and become structural as probably we have a peak in 2019 in travels, et cetera. And this will be probably decreasing in the coming years. We have another question from Jean-François [indiscernible]. How many dividend -- any dividend to be proposed on the next general meetings? At this stage, we have no plan for a dividend for 2021 -- based on 2020 results in 2021. So no dividend at this stage. Another question from Sebastian [indiscernible]?

Well, the margin, if we are speaking about 2021, the increase of margin comes from the fact that we think that the division which will grow is the data and marketing division. During 2020, this division has been affected by the fact that in it, we have the C-Media company, which is the company which makes advertisements into the French pharmacists on screens. And this company during the first lockdown has totally closed its business during 6 months. So we have lost 6 months of revenue. Last year, we think we should not lose this revenue this year, and it explains the fact that Data and Marketing will grow. And the fact that the level of margin of this division is higher than the others. So it should make the group in a better position on this margin level for the year.

We have a question from Geoffroy Michalet. You can ask your question.

Yes. Can you hear me?

Yes.

I have 2 questions actually. First one on the margin. So thank you very much for disclosing more clarity into your divisional margin. My question was on the EBITDA potential margin by division. Could you give us a sense on how much D&A you have on each division. So that we could reconcile an EBITDA for each division and to better compare with peers. The second question that I have has to do with R&D. especially, you mentioned the fact that you have close to EUR 50 million of capitalized R&D and 15%, 1-5, of R&D effort compared to your revenues. That is EUR 75 million of R&D. I had in mind that you were mentioning almost EUR 100 million of R&D. Could you explain us the gap between this EUR 100 million that you mentioned in some presentations before and EUR 75 million now?

So maybe -- okay. In the past, we had the Pulse company. And Pulse company was one of the reasons why we have stopped -- we have sold the assets of Pulse and stopped the Pulse development was that it was a very high R&D consumption. It was -- it needed a lot of higher R&D, and we have lost this part of it. And Jan Eryk, do you want to?

Yes, the second. This EUR 50 million, it's capitalized R&D. So this is only the part that we capitalized. Of course, we have also some expenses that are P&L on R&D. So if you combine what we capitalize and do all the cost, likely we'll capitalize out of our global R&D budget spending. So this is how we came to this EUR 100 million. That, of course, include also last year like Pulse. Regarding the...

Sorry, but coming forward, even without Pulse, this level, EUR 100 million is expected to be stable?

Yes. The level of R&D and the level of capital R&D will be stable for the next 2 or 3 years.

Okay. But the 14.9% of R&D effort relative to revenue is only the R&D that is expensed and not capitalized, right? Or is it...

It's both. It's all the salary of people on R&D. We take salary, we sum up all the salary of people on R&D and we divide by the revenue. So of course, this year, we get a higher percentage for 2 reasons. We have an increase of R&D team. And the second, we have a decrease of revenue. So both came to this increase. Normally, we should be around 12%.

Around 12%? Okay.

Yes.

Okay. And so for the EBITDA by division? Could you give some color on it?

Maybe the best way is, I will send you and you will find it on our registration document. I will send you the EBITDA by division.

You will see that the R&D is mainly into the first division, Software & Services. There is a question about Maiia. It's -- we will have the same level of costs in 2021 than last year? Although Maiia is multiplying its revenue by 2. The reason for that is that we have increased the number of salespeople for Maiia. So for the next year, we do not plan to have a better result, a better EBIT on Maiia or let's say, a less important loss because we want to develop this business. And as you know, we have a big competitor, and we need to develop it. Maiia is into the first division, Software and Services. If -- when you look at the level of EBIT of this first division, which is a bit more than 8%. This is not comparable to other companies in the same business, we are below and the reason for that comes from the fact that we are having a lot of costs on Maiia, paying salespeople to sign clients. So this level of EBIT should grow in the future, but not in 2021 because we go on investing on Maiia.

Then we have a question on working capital requirements. So again, we will explain the EUR 18.5 million of change in working capital requirement includes EUR 14, 1-4, million of postponement of social payment due in 2020 that we pay -- that we are paying in 2021. So excluding the working capital requirement, change in working capital requirement should have been around EUR 5 million. On other nonrecurring income and expenses, as you may see, the restructuring cost and also special item are very small ones, around EUR 5 million in 2019 and 2020. How we came from EUR 5 million to EUR 20 million is this EUR 15 million of software depreciation. Normal -- maybe in 2021, we have other software depreciation. However, what we can say is that other nonrecurring income and expenses should not exceed EUR 20 million. So probably we'll be at the lower level in 2021. At this stage it is little too early to say it will have other software depreciation or not.

We don't give the level of losses -- of Maiia losses. So looking at BPO, we are not far from breakeven. The question is -- yes. The answer is yes. We are in 2020, not far from breakeven, and we should be, in 2021, on a positive margin unless we have a strong decrease in terms of revenue due to the fact that on the HR BPO business, a lot of clients are -- [indiscernible] are reducing their staff. That's a question we may have to face in the second half because probably in the second half, all the governmental assistance to companies will decrease. And then some companies will probably fire people. And in the BPO department for HR, we are billing on the number of people managed. So unless we have some bad news on this, BPO should have a better margin in '21 than in '20.

Another question from [indiscernible]. You may ask your question, [indiscernible].

Can you hear me?

Yes.

Perfect. So a couple of follow-up questions. Maybe on -- the first one on Patrick's question. What could be the growth both on the Software and the Flow business, if H2 is better than expected? So in the Software, most of the big programs are unlocked. And in the Flow business, if the pharmacy is back to normal, what could be the growth impact for the year?

Well, if we -- we are not in the situation where -- we really don't know what will be the next month as globally for the group, we should think of a 5% growth for the year.

Okay. So 5% organic growth should be possible...

Should be The second half, yes.

The 5% should be only in the second half or for the full year, just to...

Well, in fact, probably my answer was not clear. If we were not, in this situation, we would say, well, the 2021 year should be around 5% looking at all the contracts we have signed and knowing that a big part of the business is recurrent. In first half, we really don't know where we will be. If at the end of first half, the epidemic problem is finished, then the second half should be minimum plus 5%.

Very clear. Then on the CapEx, if I'm correct, you have a growth -- the gross amount of CapEx is something like EUR 75 million, and you have EUR 11 million of inflow from the sale of an asset, I don't know which one. Last year, that was the same. There was EUR 8 million. What are these inflow linked to? Is it sustainable? Is it recurring or not? This is my second question.

At the level of CapEx, roughly -- when you look at CapEx of Cegedim, you have R&D spendings. And you have some maintenance CapEx. And if you look over the last year, maintenance CapEx has been always around EUR 15, 1-5, million roughly on average per year. Then we have this EUR 50 million. We have the R&D spending. So -- and then we have some -- from time to time, some acquisitions. So last year was EUR 6 million, the year before was EUR 20 million. So depending on the year we have around -- between EUR 0 and EUR 20 million, EUR 25 million on acquisitions. So CapEx should remain roughly stable over the next year.

Okay. Just to come back on 2020. So in 2020, you have EUR 55 million on intangibles as an investment, then you have EUR 20 million on tangible as an investment. This is from your press release. And then you have something like EUR 11 million from the -- from you selling some assets, both intangible and tangible. What is this EUR 11 million? And is it something that will come back every year? Because last year, you had EUR 8 million. And just to make sure I understood it correctly. So out of the EUR 55 million plus EUR 20 million, so EUR 75 million, there is EUR 15, 1-5, million, which is maintenance and the rest, EUR 60 million is gross CapEx for future program -- for future developments.

Yes. And disposal of tangible and untangible assets, yes, if you look over the past years, always between EUR 8 million and EUR 10 million, which is EUR 11 million this year. I can you provide more details on it if you want?

And it should be the same next year. It's not one-off?

No, it's not one-off.

No, it's the same. The main disposals comes from IT servers, IT machines. We are renewing our servers. We have 2 data centers in France and one in the U.K., and we are always changing -- buying new machines and selling old ones.

Okay. And then in the press release, you mentioned the tax claim. If I'm right, I think that was on the balance sheet, that wasn't -- the provision and the short-term provision. So I think [indiscernible]. Should we expect that the EUR 14 million would be paid out in 2021 or not? And what is the situation exactly with the tax assets? So if you lose the claim, then you will have to depreciate the write down, the EUR 20 million of tax asset.

Yes. The thing is it's going to be a long story because we have some jurisprudence, I don't know the English term, in favor -- in our favor, and we are helped by [indiscernible] which is a big company, tax company. We have discussed with the tax authorities until now, trying to find a way of making some arrangements with them. And they have answered that they didn't want to make arrangements. So we are going to the justice. So this will be a 4 to 5 years process. If at the end, we lose, then we will have to repay what we have not paid until now. The fact that we have been discussing with the tax authorities in good phase, means that we will not have to pay more than what we just would have paid if we had not made the case.

You will have to pay the interest on top?

Yes. It's the legal interest, which is I don't know exactly, but it's very low. Until now, it's less than 1%. So there are 2 solutions: If we win, then we will have made a lot of savings in terms of taxes. If we lose, then the tax authorities will have made to us a loan at a very good interest rate.

And the face value is something like EUR 14 million.

[ Sorry? ]

Yes. Yes. And coming back on Maiia because it's -- maybe some more disclosure on this side will be helpful to the market. And in our previous discussion, you never mentioned a clear number, but I think losses -- you mentioned that losses for 2020 were around EUR 5 million. Is it the case. Is it right number or...

No, no. We are having losses, which are bigger than this figure. This figure...

What could be the range of losses just for...

This figure is okay for half of the year.

Around $10 million to $15 million.

Yes. But the thing is that we are making a strong internal reorganization where we are going to join to have all the teams, which are dealing with health care professional joined into a big commercial team, and all those people will have to sell different products. And in those products, there will be Maiia. Today, we have dedicated sales team to Maiia. Tomorrow, it will be mixed with all the sales team, and everyone will have to sell all the product, which have been built for health care professionals. So this will be more difficult to have figures on strictly Maiia. Maiia will become a component of a whole range of different products.

But then -- it means you will have lower fixed cost from Maiia and you will have higher sales. So it means losses should be clearly less in 2021 than in 2020.

No, because we are on the way of making this new organization. I agree with you, this is our goal being more efficient on this part of business, but we will see some effect in 2022, not this year.

Okay. So we said 2021 will still have losses on EUR 10 million, EUR 15 million?

Yes.

Is it closer to EUR 10 million to EUR 15 million, just to...

EUR 10 million.

10 million -- in 2021, 10 million and then then 2022, maybe breakeven or loss, yes.

No, no, no. It's wrong. But we are building a new software, which is Maiia Gestion, which is a software, which includes Maiia and the other functionalities. And you see it will be more difficult to measure exactly what will be the Maiia effect. The thing we know is that we are having strong growth on Maiia.

What is the sales level for Maiia in 2020?

In 2020, we are on EUR 3 million roughly. And we have a plan to multiply it by 2.

Last question and then I leave. Generally speaking, the group has a very bad track record in terms of capital allocation. If I take Pulse, I don't know, I think you it was something like [ EUR 90 million. ] If I take into account the losses on the price you paid plus the operating losses over the years and the amount that you spend on R&D and so on. Do you think that -- I mean do you want to change things? Or should we think that, that changed internally and now the processes are different, and capital allocation will be decided differently because we can have the feeling that Maiia is burning a lot of money at the moment, and maybe the benefit is not so clear. So just your general view, did you change your capital allocation internally or not?

No. No. Maiia -- this is important to have the Maiia business being developed because we have a strong competitor. And we really must grow on this business.

So you would say that it's a good capital allocation losses at Maiia.

Everything is linked. If we are having such good level of quality on the data we are provided to the pharmaceutical companies and also to the governmental authorities, it is because we have a lot of doctors and pharmacies equipped by our assistants. Then to have a lot of doctors equipped by our assistants, we need to have something as Maiia because if we leave the field without Maiia, we know that from -- another company will come and try to compete with us on the software products. So everything is linked. And of course, part of the profits made on the data should -- is coming from the fact that we are equipping doctors.

Okay. So you need to be strong in both fields.

Yes. This is the way we are thinking about what we should do. We are almost everywhere in the healthcare area, equipping a lot of professionals, and it's difficult to cut 1 part because everything is [Foreign Language]. And -- okay. So what we have made in the past in terms of stakes was to grow abroad, thinking that the scheme we have in France, we can duplicate it in the U.S. and elsewhere. And that's the reason why we have decided to come back to Europe. It's because we have experienced the fact that to make the same type of business in the U.S., it needs a lot of investments.

Maybe 2 last questions as we're running a lot of time and roughly 1 hour has [indiscernible]. The new presentation -- the goal of the new presentation is to simplify the understanding of the group. So the goal of this new presentation is to give you more indication of what we do. I think it's more clear on this way than presenting by the kind of plan that we have before. This is absolutely not -- the reason of that is a absolutely not that we would like to sell something. So the goal is that all of this activity to there the group very important for us. They are core businesses. The BPO is very important for us, and we have absolutely no plan to make any disposal of any activity at the group level. Back to you?

Just to make an additional answer on BPO. We are not a generalist BPO. We are making BPO only on our software. So when a company asked us to be its back office when a healthcare insurance company comes and say, I want to give you my back office. It is possibly -- it is possible only when the company is equipped by our software. So BPO is really strongly linked to the Software and Service area division.

And maybe the last question Geoffroy from ODDO?

A word on competition, we all have in mind Doctolib against your Maiia solution. But I've seen recently, a startup PayFit in HR business raising lots of money. Do you see them coming in France are investing and not -- and also, let's say, attacking your positions, not only ADP, the American player.

Yes, yes. We see them. They are -- we are really focused on big, big players. We are making payroll for company, big banks, insurance companies, [indiscernible]. PayFit is more dedicated to, I would say, smaller clients. But it's true. There are competitors, a lot of competitors on this market and not only ADP and until now, we have a rather good performance on it. Fidelity, I don't know. I don't know, Jan Eryk? There is a question on the fact that Fidelity may have sold its shares?

Yes. So Fidelity has sold all the shares they got on Cegedim. So actually, Fidelity is no longer an investor at Cegedim.

So the answer to Sebastian is yes. Rue de la Paye is strictly comparable to PayFit or to [indiscernible], you may know [indiscernible]. And that's the reason why we bought this company.

There is no more questions, we'll end this Q&A session. However, you may always ask questions by e-mails over the next days. There will be also some roadshows. So you will be able to attend with us. And before we end this presentation, I would like to remind you some key points on Cegedim in 2020. So first, a very resilient business model. The second revenue on a like-for-like basis, virtually stable and recurring operating income up by 12%. Thank you very much for listening. Have a good day or good evening. Bye.

Bye-bye.