Readytech Holdings Ltd. · ASX:RDY
Readytech — FY2020 Earnings Presentation
31 slides from Readytech's earnings presentation, Aug 26, 2020
Slide 1: Results Presentation FY20
For personal use only RESULTS PRESENTATION FY2026TH AUGUST 2020 MARC WASHBOURNE – CEO NIMESH SHAH - CFO
Slide 2: Next Generation SaaS People Centric Software
For personal use only I’m a ReadyTecher NEXT Andrew Koster - Product Manager GENERATION SAAS PEOPLE CENTRIC SOFTWARE ReadyTech FY20 results - Page 2
Slide 3: New Business Driving Top Line Growth
NEW BUSINESS DRIVING TOP LINE GROWTH For personal use only ReadyTech continues to expand its customer base with blue-chip clients Example of New Customer Wins FY20 Q4 new business up 55% compared to FY19 Q4 Student Management Systems Breakthrough Education contract win of $7m (5 year subscription) w
Slide 4: Key Operational and Financial Highlights
KEY OPERATIONAL AND FINANCIAL HIGHLIGHTS For personal use only UNDERLYING UNDERLYING OPERATING REVENUE EBITDA* NPATA* CASH FLOW 19.1% 21.5% 30.1% 18.4% > TO $39.3m TO $15.6m TO $7.4m TO $14.8m CLTV to CAC CLIENT REVENUE RECURRING RATIO ARPC RETENTION REVENUE 1.5x 18% 95% 89% TO 8.4X; CLTV OF $64K TO
Slide 5: Delivering Across All Strategic Priorities
DELIVERING ACROSS ALL STRATEGIC PRIORITIES For personal use only Execute on Attract new and Grow ARPC via Continue complementary Leverage horizontal higher value upsell, cross-sell and R&D investment in Retain and invest ReadyTech best acquisitions and (enterprise) clients customer success platform
Slide 6: Successfully Navigating Through COVID-19
SUCCESSFULLY NAVIGATING THROUGH COVID-19 For personal use only Safety of our team and Investing in new Investing in Resilience and strong continuity for customers talent for growth technological innovation performance • Smooth transition to a “work from • Not a single employee stood down due • Stron
Slide 7: Strong Growth Across Key Financial Metrics
For personal use only STRONG GROWTH ACROSS KEY FINANCIAL METRICS I’m a ReadyTecher Miri Molcho, Senior Implementations Consultant
Slide 8: Strong Revenue Growth of 19%
STRONG REVENUE GROWTH OF 19% For personal use only $ MILLION Highlights FY20 FY19# % YoY Subscription and licence revenue 35.1 29.7 18.2% Implementation, training and other revenue 4.2 3.3 26.1% • T otal revenue of $39.3M driven by strong growth in Total revenue 39.3 33.0 19.1% > subscription and li
Slide 9: Investing for Growth – Sales & Marketing and R&D
ReadyTech Business INVESTING FOR GROWTHStrategy – SALES & MARKETING AND R&D For personal use only FY19 FY20 FTE BY FUNCTION FTE BY FUNCTION 24 30 15 16 95 111 46 +30 53 FTEs Total FTE^ = 180 Research & Operations Sales & Development & Implementations Corporate Marketing Total FTE = 210 Sales & Marke
Slide 10: Increased Operating Cashflow, Debt Headroom and Comfortable Balance Sheet
INCREASED OPERATING CASHFLOW, DEBT HEADROOM AND COMFORTABLE BALANCE SHEET SUPPORT INVESTMENT For personal use only NET DEBT AS AT 30 JUNE $ MILLIONS PRO FORMA FINANCIALS $ MILLIONS 30-Jun-20 30-Jun-19 Total Debt 25.0 21.5 FY20 FY19 FY18 Cash and cash equivalents 10.2 6.3 EBITDA 15.6 12.8 10.6 FY20 N
Slide 11: ReadyTech's Playbook Delivers High Value to Segments and Verticals
READYTECH’S PLAYBOOK DELIVERS HIGH VALUE ReadyTech Business Strategy TO SEGMENTS AND VERTICALS For personal use only Next Generation SaaS - Mission-Critical & Highly Trusted Education Workforce Solutions (Employment) Student Management & Work Pathways Payroll, HR & Workforce Management Shared platfo
Slide 12: Education: Student Management Systems & Work Pathways
For personal use only EDUCATION: STUDENT MANAGEMENT SYSTEMS & WORK PATHWAYS I’m a ReadyTecher Abhinesh Kharel - Product Owner CONTINUED REVENUE GROWTH WITH STRONG PIPELINE OF ENTERPRISE OPPORTUNITIES
Slide 13: Growth in Revenue and EBITDA – Education
GROWTH IN REVENUE AND EBITDA EDUCATION For personal use only Highlights • Strong new business achieved with securing of BKI TAFE contract in Q3 $ MILLIONS FY20 and over 150% increase in Q4 FY20 subscription sales versus Q4 FY19 FY20 FY19 Growth • Greater existing customer spend due to user base grow
Slide 14: The Next Generation Student Management System Opportunity
THE NEXT GENERATION STUDENT MANAGEMENT SYSTEM EDUCATION For personal use only OPPORTUNITY WHY WE WIN Pure cloud provides agile CONTRACT WINS LEGACY Sunset current legacy systems with development and regular releases digital transformation projects via subscription • Landmark new contract signed Jan
Slide 15: ReadyTech Education Market Opportunity
READYTECH EDUCATION MARKET OPPORTUNITY EDUCATION For personal use only Strong progress made penetrating the large addressable market of tertiary education and training Australian tertiary TAFE Higher ed Private Enterprise State Govt education and training (Public Uni/Private) Colleges training indus
Slide 16: Work Pathways: Back-to-Work Market
Pathways – “Back to Work” Market WORK PATHWAYS: BACK-TO-WORK MARKET EDUCATION ReadyTech is well positioned to support increasing caseloads and government funding for Back to Work sector with market leading cloud based products and services. For personal use only ReadyTech is well positioned to suppo
Slide 17: Workforce Solutions: Revenue Growth Driven by Client Growth
For personal use only WORKFORCE SOLUTIONS REVENUE GROWTH DRIVEN BY CLIENT GROWTH I’m a ReadyTecher Sinyi Chan, Financial Planning & Analysis Manager
Slide 18: Strong Growth in Revenue and EBITDA – Workforce Solutions
STRONG GROWTH IN REVENUE AND EBITDA WORKFORCE SOLUTIONS (EMPLOYMENT) For personal use only Highlights $ MILLIONS •R evenue growth driven by new client wins and growth in client spend through additional modules FY20 FY19 Growth Revenue 17.9 13.0 37.9% • I ncreased investment in business development a
Slide 19: Workforce Solutions with Unique Differentiators and Burning Platforms for Change
WORKFORCE SOLUTIONS WITH UNIQUE DIFFERENTIATORS WORKFORCE SOLUTIONS (EMPLOYMENT) AND “BURNING PLATFORMS” FOR CHANGE For personal use only OPPORTUNITY WHY WE WIN NEW CUSTOMER WINS REGULATORY CHANGES Compliance is ReadyTech’s key strength. Continuous regulatory and legislative Flexible cloud-based sys
Slide 20: Unifying and Expanding Our Workforce Cloud Offering
UNIFYING AND EXPANDING OUR WORKFORCE CLOUD OFFERING WORKFORCE SOLUTIONS (EMPLOYMENT) For personal use only BENEFITS OF ALL-IN-ONE PLATFORM ONE VENDOR UNIFIED EFFICIENT HIGH VALUE EXPANDED Traditionally in Single view of Real-time Average revenue Ability to support mid-market, employee and management
Slide 21: ReadyTech Offerings Cover the Employment Sector
READYTECH OFFERINGS COVER THE EMPLOYMENT SECTOR WORKFORCE SOLUTIONS (EMPLOYMENT) For personal use only Comprehensive and complementary Employment product suite targeting higher value customers with significant upside potential SOFTWARE Enterprise MANAGED SERVICE PAYROLL / WORKFORCE MANAGEMENT PAYROL
Slide 22: Outlook
For personal use only OUTLOOK RDY expects FY21 revenue growth rate in the mid teens, with EBITDA margin in the range of 37%-39% (inclusive of LTIP)
Slide 23: Strategic Priorities
STRATEGIC PRIORITIES For personal use only ATEGIC ACQUISITIONS STR D INCREASED FOCUS AND PROGRESS ON NEW AND ATTRACTIVE VERTICALS UN F INVEST IN PRODUCT & R&D NEW PRODUCT RETAIN CUSTOMERS 1 • New modules planned and invest in enterprise market fit • Expand investment in data analytics and IMPROVEMEN
Slide 24: Back-to-Work and Skills Sectors Gaining Momentum
BACK-TO-WORK AND SKILLS SECTORS GAINING MOMENTUM For personal use only Significant opportunity fueled by “jobactive” and JobTrainer Government Programs BACK-TO-WORK SECTOR INVESTMENT IN SKILLS jobactive is the Government’s $1.3bn program to get The Government’s JobTrainer package is a $2bn investmen
Slide 25: Key Takeaways
KEY TAKEAWAYS For personal use only Q4 FY20 new business up 55% vs Q4 FY19 and strong Navigating through COVID-19 with software supporting pipeline of $14m annualised subscription revenue companies to remotely manage people (jobs) and and implementation fees students (skills) Strong scalable growth
Slide 26: Q&A
For personal use only Q&A I’m a ReadyTecher Antoni Brdarovski - Client Success Manager
Slide 27: Student Management Systems (Education)
STUDENT MANAGEMENT SYSTEMS (EDUCATION) For personal use only ReadyTech provides mission-critical student management systems (SMS) which are at the core of modern tertiary education institutions and then seeks to drive key performance outcomes such as improved student experience and graduation rates
Slide 28: Workforce Solutions (Employment)
WORKFORCE SOLUTIONS (EMPLOYMENT) For personal use only ReadyTech is at the core of the employment software ecosystem offering mission-critical Payroll and Workforce Management solutions THE MODERN EMPLOYER RECRUITMENT INDUCTIONS & CREDENTIALS EMPLOYEE ONBOARDING WORKFLOW & TIME & ATTENDANCE PAYROLL
Slide 29: Glossary
GLOSSARY For personal use only ACV Annual contract value ARPC Average revenue per customer CAC Customer acquisition cost CLTV Customer lifetime value DHS Department of Human Services FY Refers to the financial year ending 30 June LTIP Long-term Incentive Plan NPATA Net profit after tax but excluding
Slide 30: Disclaimer
DISCLAIMER For personal use only This presentation has been prepared by ReadyTech Holdings Limited for professional investors. The information contained in this presentation is for information purposes only and does not constitute an offer to issue, or arrange to issue, securities or other financial
Slide 31: For more information / About ReadyTech
For personal use only For more information: Ronn Bechler Market Eye Pty Ltd Tel: +61 400 009 774 ronn.bechler@marketeye.com.au About ReadyTech ReadyTech is a leading provider of SaaS technology that helps providers of education and employment manage the increasingly complex human journey through stu