Slide 1: Reckon Ltd 6 months to June 2006
Slide 2: Group Financial Highlights
Group Financial Highlights 6 months to June 06 * Operating revenue up 6% * EBITDA up 20% * NPAT up 27% * Acquisitions contribute 12% * Underlying business up 15% » EPS up 33% * Interim dividend of 2 cents
Slide 3: Cashflow Highlights
Cashflow Highlights 6 months to June 06 * Cash Balance $10m * Cash Flow from Operations $4.7m ~ Working capital requirements in 2°¢ half significantly lower « Acquired Elite - Cash *« Acquired Desktop Super — Cash « Share buy back of 5% (Jan ’06) * 2005 Final dividend of $2.6M (Mar’06) *« Small parc
Slide 4: Margins
Margins 6 months to June 06 2004 2005 2006 EBITDA (pre R&D and Royalties) 7.0m 8.9m 10.0m Margin 37% 40% 43% EBITDA 4.3m 5.5m 6.7m Margin 23% 25% 29% NPAT 4.0m 3.4m 4.3m Margin 21% 15% 19% Effective tax rate 4% 35% 25% {Full year tax rate expected fo be maintained at 25%)
Slide 5: Earnings Per Share
Earnings Per Share 2004 2005 2006 EPS (basic) 2.9c* 2.5¢ 3.3¢ EPS Growth 33% * Minimal tax expense in 2004
Slide 6: Revenue Breakdown Months to June 2006
Revenue Breakdown 6 Months to June 2006 100% 90% 80% 70% 60% OC Recurring Revenue @ Full Product © Service Revenue 50% 40% 30% 20% 10% 0% APS Quicken Grp Reckon
Slide 7: Group Structure
Group Structure Reckon Lid Board Deputy Chairman Greg Wilkinson Group CEO Clive Rabie CEO Brian Armstrong Gavin Dixon QuickBooks ie Gavin Dixon
Slide 8: Group Structure
Group Structure * Professional (full service model) « Practice management * Tax management and statutory accounting tools « CRM, document storage and other modules for professional firms « Desktop Super * SMB Business Division * QuickBooks + Payroll + POS * Elite « Practice management * Tax return a
Slide 9: APS Performance
APS Performance Sales growth of 3% NPBT growth of 37% « Recurring revenue.. up 25% « Maintenance revenue in underlying business up 22% « Reflects impact of the take up of full product suite by clients « Desktop Super contributes 3% of growth « Added 49 new firms in 6 months « New business & Service
Slide 10: Professional Business
Professional Business * Australia - Reckon Surveyed the top 100 firms « Represents 29,400 Practice Management Software Seats — 48% - Big 4 — 14,000 users {in-house / international systems) — 30% - APS/ Elite — 8,802 seats (57% excluding Big 4 ) ~ 22% - Other Suppliers including Handisoft, MYOB and s
Slide 11: Practice Management Software in top 100
Practice Management Software in top 100 BRW Top 100 user count Seat no's Supplier 11
Slide 12: Professional Growth Strategies
Professional Growth Strategies * Continued high uptake of full product suite by Top 100 clients * Positioning * New products * Client management * Building platforms to support Advanced Growth + Other collaborative software applications * Building Interwoven Document Management capability (to suppor
Slide 13: Opportunities Professional Business
Opportunities Professional Business * New release of Practice Management & Fees * Expand managed service offering * Top 300 firms growth to continue * New .Net Tax release in 2007 * Desktop Super * Document and Content management solutions + Expand collaborative product offering 13
Slide 14: Quicken Performance
Quicken Performance Sales growth of 7% NPBT growth of 8% — Direct * Recurring & Service revenue - up 15% * Elite contributes 8% of growth + Underlying business up 7% — Retail + Market up by 4% to July’06* * Quicken retail growth 11% to July’06* Not yet reflected in sales to stores by June’06 “Source
Slide 15: SMB Business
SMB Business Comprises: « 400,000 registered users + 5,300 professional partners Successful launch of 2006/07 product Only new product launch in SMB space in this half Relaunch of professional partner program Awards an Elite + 2300 clients « Comprehensive range « Easy to use and install software 15
Slide 16: Quicken Strategic Advances
Quicken Strategic Advances + Leverage Intuit R&D Investment of USD 300m p.a. Significant new product features delivered year on year. For Example: Re-engineered to use SQL Database providing: - Hugely improved scalability ~ Broader market reach — Stronger customer retention Refreshed User Interface
Slide 17: Opportunities SMB Business
Opportunities SMB Business * Roll out Elite to professional partner group * Practice Management Software offering to the full professional market * Continued double digit organic growth 17
Slide 18: Foundation for future Growth
Foundation for future Growth * Organic growth continues * Strong balance sheet * Substantial cash holdings * CEO for Quicken business — focus on growth * New acquisitions bedded down and contributing above expectations * Wealth Management opportunities * 80% market share of personal finance manageme
Slide 19: Thank you
Thank you 19