Slide 1: FY2024 Full Year Financial Results
Integrated Research Limited (ASX:IRI) FY2024 Full Year Financial Results 20 August 2024 John Ruthven, CEO Christian Shaw, CFO
Slide 2: We are IR
We are IR A leading global software highly complex and company providing collaborate expanding communications performance and experience environments management solutions for the world’s mission increasingly complex and critical ecosystems. transact expanding global payments networks Real-time analy
Slide 3: Global Blue Chip Customer Base
Global Blue Chip Customer Base Long-term, high value relationships based on mission critical solutions Tech | Telco BFSI Health | Gov | Edu Retail |Industrial | Other 5/25 Fortune 500 top 5/20 largest Australian 5/10 top telcos 6/10 top USA banks companies companies (market cap) 3
Slide 4: CEO Key Messages
CEO Key Messages Building a stronger IR with an expanded product set to meet market demand • Strong revenue growth, profit result with robust cash generation • Americas delivered strong growth with Collaborate new wins partially off-setting headwinds • Cost base being tightly managed, operating effi
Slide 5: Full-Year Performance Review: Statutory (A$M)
Full-Year Performance Review: Statutory (A$M) Improving market dynamics and prudent cost management drives profits 83.3 76.3 72.4 69.8 CASH RECEIPTS FROM REVENUE 5% 19% CUSTOMERS Jun-23 Jun-24 Jun-23 Jun-24 24.6 12.1 13.8 13.0 NET OPERATING EBITDA 103% CASHFLOW 6% Jun-23 Jun-24 Jun-23 Jun-24 31.9 27
Slide 6: Full-Year Performance Review: Proforma (A$M)
Full-Year Performance Review: Proforma (A$M) Strong year for renewals 83.9 68.5 67.5 66.6 TOTAL CONTRACT ANNUAL RECURRING VALUE (TCV) 22% REVENUE 1 1% Jun-23 Jun-24 Jun-23 Jun-24 75.6 74.8 PROFORMA 17.5 16.7 PROFORMA REVENUE 1% EBITDA 5% Jun-23 Jun-24 Jun-23 Jun-24 101% 97% 23% 22% CASH CONVERSION E
Slide 7: Executive Summary FY24 Report
Executive Summary FY24 Report Priority Status Notes 1. Returning the Americas and Europe to on plan Americas TCV up ~50% and Europe TCV up growth ~30%; underwritten by strong renewals and new business in the Americas 2. Increasing new product adoption and behind Percent of TCV from new products trai
Slide 8: Collaborate Customer Wins
Collaborate Customer Wins Successfully targeting larger clients with complex ecosystems Federal Government Agency (USA) State Government Agency (USA) A leading independent technology and services provider (USA) 1-year term 5-year term 3-year term New customer New customer New customer 135,000 users
Slide 9: Transact Customer Wins
Transact Customer Wins Ensuring reliability in today’s complex payments environments Commercial Public Bank Commercial Public Bank Chile India 1-year term 18-month term New customer New customer Solution: Transact and Infrastructure Solution: Transact and Infrastructure Customer challenge: Real-time
Slide 10: Financials
Financials
Slide 11: Revenue Analysis: Statutory, Proforma and ARR
Revenue Analysis: Statutory, Proforma and ARR ARR is stabilising 120.0 • Decline in proforma revenue was mainly driven by Collaborate churn 100.0 partially offset by Transact and Infrastructure growth due to capacity increases. 80.0 • ARR has been generally flat over the past 4 years with new wins o
Slide 12: Geographic and Product Revenue Analysis
Geographic and Product Revenue Analysis Transact and Infrastructure gains offsetting Collaborate churn Geographic Asia Pacific - A$M Europe - £M Americas - US$M 20 20 60 50 15 15 40 10 10 30 20 5 5 10 0 0 0 2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024 Sta
Slide 13: Revenue Analysis: ARR Summary
Revenue Analysis: ARR Summary Flat ARR reflects business stability, headwinds offsetting growth and tailwinds 80 2.8 7.0 4.4 70 1.1 67.5 67.7 66.6 A$M 60 50 ARR Jun 2023 Upsell/New Upsell/New T&I Downsell/churn ARR Constant FX loss ARR Jun 2024 Collaborate Collaborate Currency • New logos for Collab
Slide 14: Operating Costs – A$M
Operating Costs – A$M Cost control improved by 18% to prior year Total Product and Technology 80 50 75 45 70 65 70.9 40 • Product and Technology: adopted 60 a more balanced and disciplined 55 35 50 58.0 30 approach to innovation 45 40 25 investments aligned to value 35 20 30 23.7 drivers. FY23 inclu
Slide 15: Full-Year Performance Review: Key Metrics
Full-Year Performance Review: Key Metrics Recurring proforma subscription revenue ~90% Proforma Revenue Contract Life TCV Renewal & New $68.5M $83.9M $75.6M $74.8M 10% 11% 42% 43% 73% 60% 90% 89% 28% 41% 30% 18% 30% 16% 10% 9% Jun-23 Jun-24 Jun-23 Jun-24 Jun-23 Jun-24 Recurring Non Recurring 1 & 2 Y
Slide 16: Net Cash Flow Analysis
Net Cash Flow Analysis Strong cash conversion, drives balance sheet strength 100 72.4 58.4 90 80 70 60 50 A$M 1.0 0.0 40 0.3 31.9 30 20 18.6 10 0 Net cash Cash receipts from Cash paid to suppliers Income tax Capitalised Lease, Interest & FX Net cash 30 June 23 customers and employees development 30
Slide 17: EBITDA Cash Flow Bridge
EBITDA Cash Flow Bridge No further impact from debtor factoring 30 24.6 7.9 20 16.7 2.1 A$M 0.6 1.0 13.0 Ran-off in December 2023 10 0 EBITDA - statutory Over-time revenue Proforma EBITDA Historical debtor Working capital/other Income taxes paid Net cash from operations conversion * factoring change
Slide 18: Balance Sheet
Balance Sheet Net tangible assets up 48% Period Ended (as at) Jun 24 Jun 23 YoY A$M A$M Cash and cash equivalents 31.9 18.6 72% Trade and other receivables 73.5 63.5 16% Strong balance sheet with net cash of Right-of-use assets 0.2 0.0 - $31.9M and no debt carried forward. All other assets 8.6 7.7 1
Slide 19: Strategy
Strategy
Slide 20: Strategy – Reset for Product Led Growth
Strategy – Reset for Product Led Growth Refocus go-to-market Target product and Restructure the Implement capital and customer support on engineering on fewer, organization and effort management plan to a narrow set of high- high-yield product to optimally support invest cash in innovation value, id
Slide 21: Strategy – Capital Management and Dividend
Strategy – Capital Management and Dividend • IR has a solid capital platform and expects to remain cash generative • The product set is sticky, but operates in mature, low-growth markets • The Company must innovate for product led growth and revenue diversification • IR’s Capital Allocation Prioriti
Slide 22: FY25 Priorities & Observations
FY25 Priorities & Observations
Slide 23: FY25 Priorities
FY25 Priorities • FY25 will be a transitional year, headlined by the appointment of a new CEO, refreshed Board and an emphasis on product-led growth. • IR’s strategic focus will be on: 1. Refocus go-to-market and customer support on a narrow set of high-value, ideal customers to optimize growth and
Slide 24: FY25 Observations
FY25 Observations We make the following observations regarding the current trading year: • Renewals book is softer to the prior year and is weighted towards H2 FY25. Renewals skewed modestly towards Transact and Infrastructure clients; • Collaborate churn expected to persist as clients migrate to a
Slide 25: Disclaimer
Disclaimer SUMMARY INFORMATION FORWARD LOOKING STATEMENTS NOT AN OFFER This document and the associated transcript (together “the presentation”) has The presentation contains certain "forward-looking statements”. The words The presentation is for information purposes only and is not a prospectus, be
Slide 26: Appendix
Appendix
Slide 27: Annual Recurring Revenue - Analysis
Annual Recurring Revenue - Analysis APAC Americas Europe Consolidated All Products AUD USD GBP AUD Growth • Overall FX headwind of 2%. Opening ARR 15.5 28.2 4.5 67.5 • Americas the only region with FX gain/(loss) (1.1) -2% New logos 0.6 1.7 0.0 3.1 5% wins exceeding losses. Upsell 1.0 2.9 0.2 5.7 8%
Slide 28: Proforma Revenue
Proforma Revenue Purpose: To provide an alternate view of underlying performance by restating term licence and maintenance revenues on a recurring subscription basis. How: Provides a non-statutory alternate view of underlying performance by restating term licence fee revenue to be on a recurring sub
Slide 29: Full Year proforma subscription revenue
Full Year proforma subscription revenue Reconciliation of statutory to proforma revenue Full Year Revenue 2021 2022 2023 2024 2021 2022 2023 2024 A$M A$M A$M A$M Infrastructure 18.3 17.8 18.6 19.2 -15% -2% 4% 4% Transact 10.0 10.9 11.5 12.7 -5% 10% 5% 11% Collaborate 41.4 39.6 38.3 34.9 -16% -4% -3%
Slide 30: Product TCV by Geography
Product TCV by Geography Rebound in Americas driven by large renewals APAC – A$M Americas – US$M Europe - £M 36.3 6.8 19.8 21.3 13.5 4.8 12.3 5.2 4.5 29.5 0.6 3.9 16.5 9.0 4.7 3.7 7.5 Jun-23 Jun-24 Jun-23 Jun-24 Jun-23 Jun-24 Renewal New & Capacity Renewal New & Capacity Renewal New & Capacity APAC,
Slide 31: Glossary
Glossary Annual Recurring Revenue (ARR) equals to the monthly recurring revenue at the end of the period multiplied by 12. Cash conversion rate equals cash receipts divided by proforma revenue. Customer retention equals the opening customer count for the reporting period less customers who are deeme