Cerner Corp. said Tuesday that it signed contracts for $1 billion worth of new business in the final months of last year, hitting the milestone for the first time.
The bookings are a harbinger of future sales and profits for the North Kansas City-based health care software company, already reporting strong revenue and earnings growth.
The company’s profit hit $111.8 million, or 63 cents a share, in October, November and December, up 22.6 percent from a year earlier. Revenue in the fourth quarter was a record $710.4 million, up 15 percent, as the company helped hospitals, doctors’ offices and other health care providers move into the digital age.
Among Cerner’s new contracts signed in the quarter was a deal with Los Angeles County Health Services that is one of the largest in Cerner’s history, executive vice president Zane Burke said during a conference call with analysts.
Burke also noted a new contract with Via Christi Health, the largest health care provider in Kansas, which operates hospitals in Wichita, Pittsburg, Manhattan and Wamego.
Cerner beat out its primary competitor to win those contracts, which Burke said helped Cerner gain a larger share of the market. Epic Systems Corp. in Wisconsin and Cerner are widely seen as leaders in health care software.
“We enter 2013 with a level of competitive momentum I have not seen since the early 2000s,” Burke said.
Cerner said its new contracts included 30 that will generate more than $5 million in revenue, and 17 of those will generate more than $10 million.
A year earlier, Cerner’s fourth-quarter profit was $91.2 million, or 52 cents a share, on $615.6 million in revenue. Its bookings in the fourth quarter last year were $899 million.
Cerner expects its growth to continue with higher earnings, revenue and bookings in the first quarter compared with the start of 2012.
The company said bookings would be between $720 million and $760 million in the first quarter, down from the closing months of the year, which is typical. The forecast is well ahead of the $652.3 million in first quarter bookings in 2012.
Cerner said its revenue in the first quarter should reach $690 million to $715 million, also ahead of the year-ago figure of $641.2 million.
The company estimated its first quarter earnings after an adjustment for compensation expenses. Adjusted earnings should be between 61 and 63 cents a share, up from 54 cents a year ago.
For all of 2012, bookings were a record $3.14 billion, revenue was $2.67 billion, and net income totaled $397.2 million, or $2.26 a share.
Cerner shares rose 51 cents and closed at $83.60 before the company’s report.