Audinate Group Ltd. · ASX:AD8
Audinate — UBS / Shaw & Partners conference (May 2018)
30 slides from Audinate's conference presentation, May 29, 2018
Slide 1: Investor Presentation – UBS / Shaw & Partners
Investor Presentation – UBS / Shaw & Partners Aidan Williams – Co-founder & Chief Technology Officer Rob Goss –Chief Financial Officer 29 May 2018
Slide 2: Audinate: bringing the IT revolution to the AV industry
Audinate : bringing the IT revolution to the AV industry Dante technology distributes audio signals across computer networks The Dante Audinate is the leading supplier of digital audio networking for the platform is used Professional AV industry in thousands of installations Melbourne Convention Cen
Slide 3: Audinate 101
Audinate 101 Audinate products Customers (OEM Brands) OEM Products Chips Modules Cards Software 3
Slide 4: Our competitive advantages
Our competitive advantages Comprehensive toolbox for manufacturers and users Analogue signal Selected products distribution Chips Cards Modules Software Dante signal distribution Rapid product Simplified connection development Plug and play management Interoperability Product ecosystem Commercially
Slide 5: Global leader with an attractive financial profile
Global leader with an attractive financial profile Global ASX listed business, Global leader in audio Attractive financial Significant market based in Australia networking technology profile opportunity • Spinout from NICTA • Used by the market leading • High gross margins of 75%, • Investing in gro
Slide 6: Audinate’s current addressable market
Audinate’s current addressable market Audio networking addressable market (A$m)(1) Audio networking addressable market drivers(1) • Collaboration in corporate, government and institutional workplaces 5-year 454.6 • Strong pipeline of events and meetings 352.8 CAGR: 5.2% • Growth in the live music ma
Slide 7: Competitive landscape
Competitive landscape (1,367 at Feb 18)2 Progression of products supporting audio networking solutions(1) 1000 900 Dante 916 There are several 800 competing audio Number of Products networking solution 700 providers; however, 600 Audinate is the clear global 500 market leader 400 Dante has over five
Slide 8: Growth strategy
Growth strategy Increase the number of OEMs adopting Dante Increase penetration of Dante throughout each OEM brand’s product portfolio Increase market awareness of Dante products Educate end users, system designers Encourage existing OEM customers to Continue to sign new OEM partner and integrators
Slide 9: New products and innovation
New products and innovation Audinate aims to double its addressable market by developing new products and applications 1 2 3 Dante software & applications Adapter products Video products Strategy • Provide Software to better manage • Proliferate Dante by enabling • Use Dante to transport video with
Slide 10: Financial highlights – Strong revenue growth in 3Q FY18
Financial highlights – Strong revenue growth in 3Q FY18 $4.5m ($0.4m) $13.8m ($0.6m) +10% Cash collections Negative operating Cash collections Negative operating Increase in unaudited for 3Q FY18 cashflow for 3Q 2018 YTD cashflow 2018 revenue for 3Q FY18 YTD* compared to 2Q The Company is on track t
Slide 11: 2H18 outlook
2H18 outlook On track to meet FY18 prospectus forecasts Continue to drive growth in core Dante products New product initiatives will continue in 2H18 to broaden addressable market • Continued rollout of DDM (although take up of DDM is ultimately determined by ongoing firmware adoption rate of OEMs)
Slide 12: Summary
Summary Global market Attractive financial Innovative Significant market Strong customer Experienced leader profile products opportunity base management team • Dominant • High gross • Strong portfolio • AV market • Existing customer • Stable executive position as global margins of intellectual curre
Slide 13: Thank you
Thank you 13
Slide 14: Appendix 1 Financial Information
Appendix 1 Financial Information 14
Slide 15: 2018 forecast
2018 forecast A$('000) Forecast Year Ended 30 June FY18 Sales Revenue 18,552 FY18 prospectus forecast was calculated using an AUD/USD exchange COGS (4,428) rate of 77c. The sensitivity to changes in exchange rates is summarised in the table below (per page 79 of the prospectus) Gross Profit 14,125 E
Slide 16: 2018 forecast
2018 forecast Pro Forma FY17 to FY18 bridge AUD $’M Employment costs (4.2) • New initiatives include 2.6 Marketing spend (0.8) DDM, Video & Adaptors – System & processes (0.3) more than doubles the Development capex 2.5 current addressable market • Expenditure relates to FTEs primarily focused on ne
Slide 17: 1H18 income statement
1H18 income statement (AU$’000s) 1H18 1H17 Change • 1H18 NPAT of $2.2m primarily due to favourable Sales 8,848 6,594 34% impact of tax consolidation: $2.4m (refer additional Cost of goods sold (2,245) (1,648) 36% detail in Appendix 1) Gross profit 6,603 4,946 34% Gross margin 75% 75% • Prior period
Slide 18: Strong growth in revenue and units shipped, consistent gross margin
Strong growth in revenue and units shipped, consistent gross margin Revenue (US$M) Dante units shipped 75% 75% 75% Chips Modules and Cards 74% 74% 113,898 $6.8 100,123 $6.2 $1.2 $0.9 79,964 $4.8 $4.9 $0.8 62,575 $3.6 $0.8 $0.4 47,646 $5.3 $5.6 $4.0 $4.1 $3.2 1H16 2H16 1H17 2H17 1H18 1H16 2H16 1H17 2
Slide 19: Revenue growth outstripping operating costs
Revenue growth outstripping operating costs AUD Revenue & Cost trends AUD $M 10 9 Revenue Audinate invoices its 8 customers in USD, Revenue 7 therefore revenue is US CAGR: 29% 6 sensitive to FX AU CAGR: 22% 5 fluctuations Employee costs Costs 4 Revenue growth AU CAGR 16% 3 exceeding operating 2 Admi
Slide 20: 1H18 cash-flow statement
1H18 cash-flow statement (AU$’000s) 1H18 1H17 Change Cash flows from operating activities • 1H18 payments to suppliers includes $0.9m Receipts from customers 9,304 7,182 30% of IPO costs Payments to suppliers and employees (9,947) (6,848) 45% Interest received 142 21 587% • Adjusting for this item o
Slide 21: Statutory balance sheet
Statutory balance sheet (AU$’000s) 31 Dec 17 30 Jun 17 Change Cash and cash equivalents 14,4551 18,694 (23%) Trade and other receivables 1,834 2,030 (10%) 1. At the beginning of July the Group Receivable form issue of shares 01 4,062 (100%) received the balance of IPO proceeds R&D incentive 02 902 (
Slide 22: Appendix 2
Appendix 2 22
Slide 23: Selected products
Selected products Chips, Modules and Cards Reference designs Adapter products Dante Ultimo (Chip) Dante Brooklyn II Cards Dante Broadway (Chip) Dante IP Core/ Dante Dante Adapter Module (Module) HC / Brooklyn II / Custom designs Used in low channel Used in medium to Peripheral soundcards Product lau
Slide 24: Selected products
Selected products Software Dante Controller Dante Virtual Soundcard Dante Via Dante Domain Manager Software to enable the Software-only sound card Software that turns audio Product launch expected in second half FY18 configuration and setup of Dante enabling PC and Mac audio applications and compute
Slide 25: Increasing customer adoption: pipeline for growth
Increasing customer adoption: pipeline for growth Total customers and customers with Dante-enabled products available 392 346 258 189 180 192 144 160 120 93 109 73 52 1H14 2H14 1H15 2H15 1H16 2H16 1H17 2H17 1H18 Customers with Dante-enabled products available Total customers Audinate has grown to 19
Slide 26: Dante Domain Manager
Dante Domain Manager Dante Domain Manager (DDM) is network management software that enables user authentication, role- based security and audit capabilities for Dante networks. • Updated firmware delivered to OEMs for release to their customers in 2Q18 • Commercial product launch at Integrated Syste
Slide 27: Dante AVIO Adaptors
Dante AVIO Adaptors Dante AVIO is a cost-effective family of adaptors to connect legacy analogue equipment, USB and AES3 digital audio equipment to Dante networks. • Product design, testing and QA completed in 1H18 • Commercial product launch at National Association of Music Merchant (NAMM) tradesho
Slide 28: Video
Video Audinate is developing a video solution to distribute video signals from HDMI connections across a network. • Prototype hardware complete and functional • Software and firmware development on track • On schedule to demonstrate product at InfoComm tradeshow in June 2018 28
Slide 29: Sound reinforcement industry overview
Sound reinforcement industry overview Sound Reinforcement products(1) Market size(1) Product % of digital Audio networking for Pro-AV A$352.8m Sound Reinforcement market(1) (Audinate’s directly A$352.8m Microphones 36% addressable market) 5-year CAGR: 2.9% 10.7 9.3 Mixers 15% 5-year Sound Reinforcem
Slide 30: Important notice and disclaimer
Important notice and disclaimer Disclaimer Past performance IFRS and may be calculated differently by other companies. To the maximum extent permitted by law, none of the Past performance information, including past share price Market share information Audinate Group Limited or its subsidiaries or t
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