iSoft believes speculation on finances ‘unfounded’

iSoft, the health service software specialist, was yesterday forced to issue a stock market statement denying it is in financial difficulties on a day that its shares plunged by 47% at one point.

Financial reports indicated that iSoft’s dramatic falls, occurred on the back of rumours that the NHS was seeking to end the firm’s three key NHS deals.

iSoft is the key software sub-contractor to prime contractor CSC for the North West and West Midlands, and Accenture for the North east and East of England under the late-running £6.2 billion NHS IT programme

According to a report in The Guardian there "was also speculation that the company could be facing bankruptcy".

In its trading statement yesterday iSoft said: "iSoft is aware of market speculation regarding the financial standing of the company. The company believes this speculation is unfounded and reiterates the guidance for the current financial year."

One analyst told E-Health Insider: "The market doesn’t like uncertainty and we have uncertainty over the financial position of the company, uncertainty over its main contracts and uncertainty over the product."

According to a separate report by Reuters a spokeswoman for CSC said the company had "no plans to stop working with iSoft".

iSoft warned on profits in January, saying that ongoing "rescheduling" of the NHS IT programme would delay earnings from its NHS IT programme contracts, leading the firm to cut its predicted profit guidance for the year by £45m.

Last week US group Accenture, iSoft’s partner on two NHS contracts, made a £257m provision to cover losses on NHS projects. Accenture specifically blamed iSoft for "significant" delays in the delivery of its Lorenzo software.

The NHS Connecting for Health agency appeared to back iSoft by issuing a subsequent statement in which it said that CSC had deployed a significant amount of older iSoft software and saying it believed the "issues are within Accenture’s control".