AVEVA — H1 FY2021 Earnings Presentation
32 slides from AVEVA's earnings presentation, Nov 5, 2020
Slide 1: AVEVA Group plc Results for the six months ended 30 September 2020
5 November 2020 AVEVA Group plc Results for the six months ended 30 September 2020
Slide 2: Important notice
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD BE UNLAWFUL. THIS PRESENTATION IS FOR INFORMATION PURPOSES ONLY AND IS NOT AN OFFER OF SECURITIES IN ANY JURISDICTION. BY ATTENDING ANY MEETING WHERE THIS PRESENTATION IS MADE, OR
Slide 3: Forward-looking statements
This presentation contains statements that may constitute forward-looking statements relating to the business, financial performance and results of the Company and the industry in which the Group operates. These statements may be identified by words such as "expectation", "belief", "estimate", "plan
Slide 4: Highlights
Highlights Craig Hayman, CEO 4 ©2020 AVEVA Group plc and its subsidiaries. All rights reserved.
Slide 5: H1 FY21 results
H1 FY21 results Leading the digitalisation of the industrial world Creditable performance in the first half Financial results broadly in-line with management plan for the shape of the year Interim dividend maintained reflecting confidence in AVEVA’s resilience Significant investment made in Cloud,
Slide 6: Financial Review
Financial Review James Kidd, Deputy CEO and CFO 6 ©2020 AVEVA Group plc and its subsidiaries. All rights reserved.
Slide 7: Creditable financial performance versus a tough comparative
Creditable financial performance versus a tough comparative* Results for the six months ended 30 September 2020 Total revenue Recurring revenue Adjusted EBIT Adjusted EBIT margin Adjusted diluted EPS £332.6m 64.2% £56.3m 16.9% 28.26p (15.1)% +230bps (37.9)% (620)bps (34.7)% • Organic constant curren
Slide 8: Income statement H1 FY21
Income statement H1 FY21 H1 FY21 H1 FY20 Six months ended September 2020 Change £m £m • Organic constant currency revenue Revenue 332.6 391.9 (15.1)% declined by 11.7% Cost of sales (83.7) (92.3) (9.3)% • Adjusted costs reduced by 8.3% Gross profit 248.9 299.6 (16.9)% • Tax rate on adjusted profit b
Slide 9: Revenue bridge H1 FY21 versus H1 FY20
Revenue bridge H1 FY21 versus H1 FY20 Six months ended 30 September 2020 versus prior year £391.9.m (7.4)m £384.5m (7.0)m (44.9)m 400 • Organic constant currency revenue -11.7% • Excluding the revenue pull forward 350 related to the early renewal of a large Global Account contract in H1 FY20, organi
Slide 10: Revenue breakdown H1 FY21
Revenue breakdown H1 FY21 Organic • Subscription revenue reduced H1 FY21 H1 FY20 Six months ended 30 September % of total % of total Change constant versus a tough comparative in £m £m currency the prior year, which contained a number of multi-year Subscription 113.9 34.2% 141.0 36.0% (19.2)% (17.6)
Slide 11: Adjusted cost base H1 FY21
Adjusted cost base H1 FY21 H1 FY21 H1 FY20 Constant • Costs excluding R&D: Reduced by 7.6% on a Six months ended 30 September Change £m £m currency constant currency basis Cost of sales 83.7 92.3 (9.3)% (7.6)% • Cost of sales: Reduction in cost of delivering services Research & Development 60.3 60.1
Slide 12: Exceptional and normalised items
Exceptional and normalised items • Acquisition costs re OSIsoft: Bank facility H1 FY21 H1 FY20 fees, due diligence and legal costs incurred Six months ended 30 September £m £m • Integration costs: Consists mainly of IT costs Acquisition costs re OSIsoft 16.3 - related to the TSA exit from Schneider
Slide 13: Balance sheet
Balance sheet 30 September 2020 31 March 2020 £m £m • Strong balance sheet with c£60m of Non-current assets 1,911.2 1,956.0 net cash and deposits and no long- Trade and other receivables 185.1 242.2 term debt Contract assets 159.5 142.4 • Contract assets increased due to the upfront revenue recognit
Slide 14: Adjusted EBIT to cash from operating activities
Adjusted EBIT to cash from operating activities H1 FY21 H1 FY20 Six months ended 30 September • Strong cash collections £m £m from customers Adjusted EBIT 56.3 90.6 • Pre-exceptional cash Depreciation 13.5 10.1 generation of £60.1m R&D tax credit (1.4) (1.2) broadly flat year-on-year Amortisation no
Slide 15: Operational Review
Operational Review Craig Hayman, CEO 15 ©2020 AVEVA Group plc and its subsidiaries. All rights reserved.
Slide 16: Leading the digitalisation of the industrial world
Leading the digitalisation of the industrial world • Digitalisation is driving growing demand for industrial software • AVEVA continues to make substantial investment to drive future growth Telecom IT Finance & Insurance Automotive Retail Materials Marine Industrials Food & Beverage Buildings Utilit
Slide 17: Business Unit and geographic diversity
Business Unit and geographic diversity Six months ended 30 September 2020 Americas Asia EMEA £118.3m Pacific £127.2m £87.1m Engineering Monitoring & Control APM Planning & Operations 36% of revenue 35% of revenue 15% of revenue 14% of revenue Revenue (26)%* Revenue (5)%* Revenue (7)%* Revenue (2)%*
Slide 18: Shell evolving its Digital Twin strategy
Using AVEVA’s Engineering Data Warehouse in the Cloud, Shell is evolving its Digital Twin strategy. With a common digital thread across Engineering, Operations and Maintenance, teams can securely access information in context across Shell’s global operations. This will enable Shell to drive asset re
Slide 19: Saudi Aramco
Saudi Aramco Saudi Aramco remotely implemented AVEVA Unified Operations Center Early value chain optimization using 3D engineering model Improved visibility for faster decision making Installation completed remotely, securely and on time during lockdown 19 © 2020 AVEVA Group plc and its subsidiaries
Slide 20: Veolia Water Technologies used AVEVA Connect in the Cloud
Veolia Water Technologies used AVEVA Connect in the Cloud to connect 260 global engineering teams, driving creativity, collaboration and sustainable best practices across its global water business 20% increase in IT efficiency worldwide Improved project transparency Better cross-team collaboration S
Slide 21: Being digital in everything that we do
Being digital in everything that we do • Comprehensive employee support within lockdown • Sales kick-off meeting, AVEVA Ignite, held remotely in April to provide sales and technical teams with the necessary skills, training and product enablement to support selling digitally • AVEVA World Digital co
Slide 22: Summary and Outlook
Summary and Outlook Summary • Financial results broadly in-line with management plan for the shape of the year • Significant investment made in Cloud, AI and Extended Reality • Interim dividend maintained reflecting confidence in AVEVA's resiliance Outlook • Order pipeline for the remainder of the f
Slide 23: ©2020 AVEVA Group plc and its subsidiaries. All rights reserved.
©2020 AVEVA Group plc and its subsidiaries. All rights reserved.
Slide 24: Acquisition of OSIsoft
Acquisition of OSIsoft Bringing together two of the leaders in engineering and industrial software 1 2 3 Transaction expected to deliver AVEVA and OSIsoft combine to exceptional value to shareholders, AVEVA to continue its journey to accelerate the next generation of partners and customers – OSIsoft
Slide 25: OSIsoft has a strong financial profile
OSIsoft has a strong financial profile OSIsoft continues to perform very well in 2020 Revenue ($m) Operating Profit ($m) • OSIsoft achieved 9.5% revenue 25.9% 25.6% 27.3% 13.5% 23.1% growth and 110.1% adjusted % Margin EBIT growth in the seven months to 31 July 17-19 CAGR: 5.4% 466 470 17-19 • Posit
Slide 26: Substantial synergies
Substantial synergies • Cross selling • Expanding OSIsoft’s global reach Revenue synergies • Developing and launching new combined products • Leveraging our go-to-market proposition with Schneider Electric • Annualised cost synergies of at least £20m expected by March 2023 achieved through: • Deploy
Slide 27: Appendices
Appendices 27 ©2020 AVEVA Group plc and its subsidiaries. All rights reserved.
Slide 28: Downstream
Proportion of revenue Focus area Established positions Avenues for growth 5-10% 5-10% ~40% 5-10% 5-10% 5-10% ~10% Batch and Discrete Process Utilities, Infrastructure, Buildings Hybrid Downstream Discrete and and Pharma Smart Infra Datacentre Midstream Spec Chem Transport. Smart City Chemicals Upstr
Slide 29: Cash flow
Cash flow H1 FY 21 H1 FY 20 Six months ended 30 September £m £m Net cash from operating activities before tax 23.7 43.5 Tax paid (11.3) (27.6) Acquisition of a subsidiary, net of cash acquired - (22.2) Proceeds from sale of subsidiaries net of cash - (1.5) Purchase of PPE and intangible assets (7.1)
Slide 30: Major currencies
Major currencies Approximate GBP vs. local currency H1 FY21 percentage of revenue average vs. H1 FY20 average USD 49% (0.9)% Euro 13% (1.0)% GBP 8% - KRW 5% (2.6)% CAD 4% (2.6)% JPY 4% 1.0% CNY 3% (1.8)% Other 13% (10.8)% Total 100% (2.1)% • 2% currency translation headwind in H1 FY21 • Current stre
Slide 31: Definitions & terms
Definitions & terms • Organic constant currency revenue: Excludes the impact of business combinations and divestments, reverse acquisition accounting adjustments and currency translation. • Recurring revenue: Subscription plus Maintenance revenue. • Adjusted profit before tax, adjusted EBIT and adju
Slide 32: About AVEVA
linkedin.com/company/aveva @avevagroup ABOUT AVEVA AVEVA is a global leader in engineering and industrial software driving digital transformation across the entire asset and operational life cycle of capital-intensive industries. The company’s engineering, planning and operations, asset performance,