Idox Plc · LSE:IDOX
Idox — HY20 Earnings Presentation
24 slides from Idox's earnings presentation, Jun 12, 2020
Slide 1: Idox Results HY20 Investor Presentation
idox ldox Results 6 months year ended 30 April 2020 (HY20) Investor Presentation a7
Slide 2: Idox investment highlights
• A leader in the supply of Next Generation Public Sector Software • One Idox bringing together our 3 Operating Divisions under our four pillars framework to drive operational excellence and • Modern solutions that deliver deep domain knowledge of leverage resources regulatory services to our custom
Slide 3: HY20 highlights
• Strong strategic delivery following the extensive transformation across the Group Recurring in FY2019 Revenue • Improved operating margins following £18.7m improvements to revenue governance and Revenue Net Debt HY19: £16.9m cost control £35.1m £14.3m • Further material reduction in Net Debt from
Slide 4: Rob Grubb, Chief Financial Officer
Rob Grubb Chief Financial Officer
Slide 5: HY20 financial summary
• Revenues up strongly due to more normalised revenue recognition, Tascomi Revenue Recurring Revenue acquisition and timing of National Election Adjusted EBITDA • Strong revenue visibility for remainder of £35.1m £18.7m £9.6m FY20 and improved orderbook of non- +13% +13% +138% recurring revenues HY1
Slide 6: Public Sector Software division results
Revenues £ms Adj. EBITDA £ms Adj. EBITDA margin 30.0 10.0 40.0% 8.0 30.0% 20.0 6.0 20.0% 10.0 19.0 24.1 4.0 8.2 33.9% 2.0 10.0% 2.9 15.2% - - 0.0% HY19 HY20 HY19 HY20 HY19 HY20 • Contributed 69% of Group revenue in HY20 (HY19: 61%) Revenues £’ms • Comprising Local Authority (incl. Tascomi), Election
Slide 7: Engineering Information Management division results
Revenues £ms Adj. EBITDA £ms Adj. EBITDA margin 5.0 0.8 20.0% 4.0 0.6 15.0% 3.0 0.4 10.0% 2.0 4.6 4.3 0.7 16.8% 1.0 0.2 0.5 5.0% 10.6% - - 0.0% HY19 HY20 HY19 HY20 HY19 HY20 • Contributed 12% of Group revenue in HY20 (HY19: 15%) Revenues £’ms • Sales decline reflects ongoing strategic move from ente
Slide 8: Content division results
Revenues £ms Adj. EBITDA £ms Adj. EBITDA margin 8.0 1.0 12.0% 0.8 10.0% 6.0 0.6 8.0% 4.0 6.0% 7.4 6.7 0.4 0.8 10.4% 10.9% 2.0 0.7 4.0% 0.2 2.0% - - 0.0% HY19 HY20 HY19 HY20 HY19 HY20 • Contributed 19% of Group revenue in HY20 (HY19: 24%) Revenues £’ms • Comprising Business Services (Netherlands), Da
Slide 9: Adjusted EBITDA and income statement
£'ms HY20 HY19* Variance • Adjusted EBITDA up due to revenue improvements primarily in PSS, and margin improvements across Revenue 35.1 31.0 4.1 the Group Adjusted EBITDA 9.6 4.1 5.5 Depreciation & Amortisation (3.3) (2.1) (1.2) Interest (1.4) (0.9) (0.5) • D&A up due to IFRS 16 and higher recent in
Slide 10: Cash flow
£'ms HY20 HY19* Variance • Adjusted EBITDA up due to revenue growth (primarily in Adjusted EBITDA 9.6 4.1 5.5 Restructuring, acquisition & finance costs (0.9) (1.3) 0.4 PSS), and margin improvements across the Group Working capital 8.2 6.8 1.4 Taxation (1.0) 1.1 (2.1) • Restructuring cash outflows i
Slide 11: Balance sheet
HY20 HY19* Variance £'ms • Fixed asset increase following the acquisition of Fixed Assets 88.7 78.2 10.5 Tascomi in the year. Capitalised R&D slightly higher Deferred tax assets & liabilities (3.1) (0.4) (2.7) than amortisation due to more product focus Stock - 0.1 (0.1) Trade & other receivables, a
Slide 12: FY20 trading in line with expectations
Revenue organic growth targets Margin targets Income Statement items • PSS high single digits for FY20, • Expecting step-up in FY20 margin due • Adoption of IFRS 16 additive to adjusted reducing to low single digits longer-term. to transformation depressing margins in EBITDA, but neutral at profit b
Slide 13: Dave Meaden, Chief Executive Officer
Dave Meaden Chief Executive Officer
Slide 14: Continued strategic performance following FY2019 transformation
Continued strategic performance following FY2019 transformation. Idox enters second half with strong momentum • Focus on ‘Four Pillars’ programme to improve revenues, margin, communication, and organisational simplicity • Consolidation of operations, including combining management structures and res
Slide 15: Four Pillars underpinning One Idox strategy
We have embedded the 4 pillars which underpin our One Idox strategy across the business: Revenue Enhancement Margin Enhancement Increased focus, governance and professionalisation of the Enhanced Business Approval Process now fully integrated into sales force which is more closely aligned to markets
Slide 16: Walk, Run, Fly phases
Walk Phase (FY19) complete Run Phase (FY20) • Implementing Group-wide CRM and improving use of ERP • Improving revenue opportunities in existing base through more focused account management • Stratification of sales effort focusing skills on new business generation and business development • Continu
Slide 17: Targets and path to FY21
Target Recurring rev 75%+ Adj. EBITDA 30%+ margin Net Debt Cash+ Recurring rev £35.7m Adj. EBITDA £14.4m More Sales team Utilise IP in Strategic Better MI Net Debt £26.4m automation stratification adjacencies acquisitions Future Leverage 1.8 periods Recurring rev £30.6m Move Adj. EBITDA £13.6m FY20
Slide 18: Summary & Outlook
idox Summary & Outlook 18
Slide 19: Group executing to a well orchestrated plan
All parts of the Group executing to a well orchestrated plan with better quality data Improvements to account management and sales execution planned to provide stronger revenue growth and better customer outcomes Consolidating more activity around our public-sector software core to further improve m
Slide 20: Q&A
Q&A
Slide 21: Thank you
Thank you
Slide 22: Appendices
idox Appendices
Slide 23: Divisional revenue breakdown
Restated Restated H1 2020 H1 2019 Variance H1 2020 H1 2019 Variance £'m £'m £'m £'m £'m £'m Public Sector Software Content - Recurring: software 12.8 11.3 1.5 - Recurring: software 2.4 2.1 0.3 - Non-recurring: software 4.7 2.7 2.0 - Non-recurring: software 1.3 1.3 - Software revenue 17.5 14.0 3.5 So
Slide 24: Division business unit descriptions
Division Business Unit Description PSS Local Software enabling council and other local authority and their residents to interact with each other and progress Government planning, building control and environment protection applications and other matters. PSS Transport Bespoke, cost-effective solutio