Energy One Limited · ASX:EOL
Energy One — Merger or Acquisition (January 2020)
35 slides from Energy One's merger presentation, Jan 6, 2020
Slide 1: Energy One signs share purchase agreement to acquire eZ-nergy
06 January 2020 Energy One Limited (ASX : EOL) Energy One signs share purchase agreement to acquire eZ-nergy Further to our announcement of 24 December 2019, please find attached presentation in relation to the signing of a share purchase agreement to acquire 100% of eZ-nergy, a French company selli
Slide 2: Signs share purchase agreement to acquire 100% of eZ-nergy
Energy One Limited (ASX:EOL) Signs share purchase agreement to acquire 100% of eZ-nergy 1
Slide 3: Disclaimer
Disclaimer This document has been prepared by Energy One Limited (EOL) and comprises written materials and slides for a presentation concerning EOL. This presentation is for information purposes only and does not constitute or form part of any offer or invitation to acquire, sell or otherwise dispos
Slide 4: Contents
Contents About eZ-nergy 6 Operational 16 Acquisition financials 22 Strategy 26 Appendices 32 3
Slide 5: Energy One signed a share purchase agreement to acquire 100% of eZ-nergy
Energy one is pleased to announce it has signed a share purchase agreement to acquire 100% of eZ-nergy 4
Slide 6: Transaction is earnings accretive
Transaction is earnings accretive eZ-nergy is a French based company selling Software as a Service (SaaS) to the energy and utilities industry. https://www.ez-nergy.com/ eZ-nergy is an established profitable company, will be immediately earnings accretive, and will be funded using bank debt and equi
Slide 7: About eZ-nergy
About eZ-nergy 6
Slide 8: A profitable SaaS company
A profitable SaaS company Established in 2013 by its three founders, eZ-nergy is headquartered in Paris, France with 44 customers in 8 countries and a staff of 18. A pure Software-as-a-Service (SaaS) business with 86% recurring revenue Well established, profitable, power scheduling/nominations softw
Slide 9: eZ is a company with high growth potential
eZ is a company with high growth potential Our analysis indicates there may be ~1,500 potential EU customers for the eZ software and services with little penetration by competing vendor systems. It appears most customers use internally built systems. eZ currently have 44 customers. 8
Slide 10: A robust suite of software serving multiple European energy markets
A robust suite of software serving multiple European energy markets Three software modules run under a single user interface: Energy flows management, data aggregation, rapid pre- Physical eZ-Ops settled actions, Dashboard to monitor traded and balancing nominated positions and imbalances. European
Slide 11: Profitable power nominations software underpins the business
Profitable power nominations software underpins the business The Balancing and Scheduling modules are mature and highly functional in both electricity and gas. The modules have extensive market-readiness with market interfaces in multiple countries available ‘out-of-the-box’. The Scheduling/nominati
Slide 12: Contigo and eZ-nergy - a perfect match
Contigo and eZ-nergy - a perfect match Contigo is strong in the UK with ambitions towards European growth and eZ is the other way, complementing each other. Operationally we will combine products, strengths and expertise to better reach and serve our Customers. An EU office gives us a Brexit hedge P
Slide 13: Highly synergistic with Contigo
Highly synergistic with Contigo • eZ-nergy and Contigo written in the same software language • This will allow easy product integration, sharing of functionality, tools and development resources. • In fact, enTrader (Contigo) and eZ-Ops (eZ-nergy) already work together. Have 3 common customers toget
Slide 14: Products are very complimentary
Products are very complimentary eZ-nergy’s and Contigo’s shared language provides immediate product combination. This is particularly true with enVoy/eZ-Ops where we can quickly offer a unique and comprehensive end to end solution for European power and gas scheduling (physical) and, by including en
Slide 15: Opportunity to leverage combined sales & marketing
Opportunity to leverage combined sales & marketing eZ-nergy’s focus to date has been building and marketing their excellent technology. Aa a start-up with a limited sales and marketing budget eZ-nergy has been successful based on the strength of their product. Sales of eZ software will benefit from
Slide 16: eZ-nergy's blue chip customer base
eZ-nergy’s blue chip customer base 15
Slide 17: Operational
Operational 16
Slide 18: Two excellent management teams
Two excellent management teams • Contigo’s executive and technical team have been integral in the due diligence. • The founders of eZ-nergy have grown a very successful business based on the strength of their technology and sound leadership. • Culturally the eZ and Contigo management teams are an ex
Slide 19: Positive operational integration
Positive operational integration • Simon Wheeler the European CEO successfully led the operational integration of Contigo into the Energy One group. • The eZ-nergy and Contigo management teams have already identified a clear path for product integration & ownership of product development. 18
Slide 20: There will also be back office synergies
There will also be back office synergies Reduced back office costs arising from economies of scale with the combined use of: • Cloud infrastructure • Database licenses • Combined accounting system 19 19
Slide 21: Remaining regulatory hurdles
Remaining regulatory hurdles While both legal and operational due diligence have been completed and finance well progressed, several regulatory hurdles, including French Foreign Investment Clearance, still need to be completed. At this stage there are no obvious issues and provided all goes smoothly
Slide 22: Key benefits
Key benefits ü Merging Contigo and eZ provides a unique and comprehensive solution to European Power & Gas Trading and nomination/scheduling ü Provides Contigo with: ü UK Gas, Gemini nomination capability ü European Ancillary Services and physical scheduling capability ü Automated trading and short-
Slide 23: Transaction financials
Transaction financials 22
Slide 24: Total cost of acquisition is €4 million over 18 months
Total cost of acquisition is €4million over 18 months EURO AUD* Consideration Payable €2,000,000 $3,252,000 Cash On completion €500,000 $813,000 Equity On completion €500,000 $813,000 Cash 6 months post completion €500,000 $813,000 Cash 12 months post completion €500,000 $813,000 Cash 18 months post
Slide 25: The acquisition will be immediately earnings accretive
The acquisition will be immediately earnings accretive Given the regulatory hurdles may not be complete until February or March 2020 there will only be three to four months of financial contribution to FY20. However we anticipate the first full year (FY21) eZ-nergy will generate income of approximat
Slide 26: A combination of debt and equity will be used to acquire eZ-nergy
A combination of debt and equity will be used to acquire eZ-nergy • We will look to expand the existing Westpac debt facility. (5-year amortising debt with a current interest rate of 3.60%) • Equity will be issued to the vendors and we may also perform a small capital raise depending on debt sizing.
Slide 27: Strategy
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Slide 28: We're successfully executing our long term strategy
We’re successfully executing our long term strategy Diversification Grow customer base Grow by acquisition ✓ ✓ ✓ New products Three acquisitions in 3 Established European developed / acquired years, continue to look headquarters in FY19 for other opportunities 27
Slide 29: The strategy to diversify revenue by product and geography is creating a robust business
The strategy to diversify revenue by product and geography is creating a robust business In 2013 EOT was our biggest product with ~$1.5M in sales. This represented almost 90% of total revenue. In 2019 (i.e. pre-eZ) EOT was still a significant product with ~$4.2M in revenue but importantly now only r
Slide 30: Acquisitions have also helped diversify our customer base
Acquisitions have also helped diversify our customer base • With eZ in the group, the business now has more than 250 customer installations in 17 countries • Anticipated combined recurring revenues will be >70% • Opportunity to cross- sell/bundle/package offerings to existing customers • Greater lev
Slide 31: The EOL group is now a truly global vendor of ETRM systems
The EOL group is now a truly global vendor of ETRM systems Following the acquisition of eZ-nergy the Energy One group will have over 250 customer installations in 17 countries. 30
Slide 32: Mr Shaun Ankers - CEO and Managing Director
Mr Shaun Ankers - CEO and Managing Director Email: enquiries@energyone.com.au Level 13, 77 Pacific Highway North Sydney NSW 2060 31
Slide 33: Appendix
Appendix Additional information 32
Slide 34: eZ power scheduling software for multiple European markets
eZ power scheduling software for multiple European markets Country/region Market TSO’s France RTE (PEB & Morgan) Germany Amprion / 50 Hertz / Tennet / Transnet Belgium Elia Netherlands Tennet Denmark Energinet Sweden Svenska Kraftnät Austria APG / APCS Switzerland Swissgrid Italy Terna UK Elexon / I
Slide 35: eZ gas scheduling software for multiple European markets
eZ gas scheduling software for multiple European markets Country/region Market TSO’s France GRTgaz/Terega/Storengy Germany NCG/Gaspool/Bayernets/EWE/Fluxys/Tenp/Gascade/ GRTGazD/GTG/Nord/GasunieD/Nowega/Ontras/OGE/ Terranets/Thyssengas/Trianel Belgium Fluxys/Huberator Netherlands GTS Denmark Energin