Slide 1: Progress — a Great Story
Progress — a Great Story Yogesh Gupta Chief Executive Officer April 4, 2023 People. Proven. Progress.
Slide 2: $2.5B Market cap global infrastructure software company
$2.5B Market cap global infrastructure software company 1981 $684M $4.13 Founded Revenue EPS All financial results shown are on a non-GAAP basis. Note: US$ in Millions. Progress Fiscal Year ending November 30. Mid-point of guidance as of March 28, 2023 © 2023 Progress Software Corporation and/or its
Slide 3: Progress at a Glance
Progress at a Glance ~$575M 100+% 38+% Recurring Net Retention Operating Revenue (ARR) Rate (NRR) Margins Significant visibility on Exceptionally sticky Industry-leading profits go-forward revenue customer base provide strength, stability and drive investments ~$220M 17+% 2,300+ Unlevered Free Produ
Slide 4: Consistent Financial Performance
Consistent Financial Performance 5 YEARS FY '18 –FY '23E Revenue CAGR 12.5% Operating Income CAGR 14.4% EPS CAGR 13.5% Progress Revenue & EPS Progress ARR & NRR $4.13 $4.13 102.1% 102.3% 102.0% $3.87 100.1% 99.9% $3.09 $2.69 $2.19 $684 $567 ~$575 $611 $543 $557 $532 $507 $456 $432 $379 FY '18 FY '19
Slide 5: Our Vision, Our Mission
Our Vision To propel business forward in a technology-driven world. Our Mission To be the trusted provider of the best products to develop, deploy and manage high- impact applications. © 2023 Progress Software Corporation and/or its©subsidiaries 2023 Progress or affiliates. SoftwareAllCorporation ri
Slide 6: Our Total Growth Strategy
Our Total Growth Strategy 1. Invest and Innovate 2. Acquire and Integrate 3. Drive Customer Success Double Revenue and Profitability Every 5 Years © 2023 Progress Software Corporation and/or its subsidiaries or affiliates. All rights reserved. 6
Slide 7: 1. Invest and Innovate
1. Invest and Innovate Products People Systems & Processes Strong R&D investment in Thoughtful investment in our Innovating our systems and ÇÇ us current products keeps people grows our talent and processes keeps us nimble and responsive to evolving ensures they remain engaged, and enables rapid acq
Slide 8: Innovation Across the Portfolio
Innovation Across the Portfolio Cloud digital experience Lowest TCO app/DB platform Pioneer in DevOps platform for cloud applications and DevSecOps Modern UI made easy— Premier cloud, on-prem Application high availability mobile, web, AR/VR, chat and hybrid data connectivity scalability and security
Slide 9: Award-Winning Products
Award-Winning Products © 2023 Progress Software Corporation and/or its subsidiaries or affiliates. All rights reserved. 9
Slide 10: 2. Acquire and Integrate
2. Acquire and Integrate Acquire Strong Businesses Integrate into Progress Platform • Repeatable M&A playbook across all functions Disciplined criteria for identifying targets: • Infrastructure software • Keen focus on profitability/margin improvement • Revenue size 10-25% of our revenue • Disciplin
Slide 11: M&A Track Record
M&A Track Record MarkLogic ~12.5% Revenue Revenue R CAG $611M ~$684M* Kemp Revenue $557M $4.13 Chef EPS Ipswitch Revenue Revenue $456M $432M Total Growth Strategy Implemented Revenue $2.19 $379M EPS FY '18 FY '19 FY '20 FY '21 FY '22 FY '23E All financial results shown are on a non-GAAP basis * Mid-
Slide 12: Demonstrable M&A Successes
Demonstrable M&A Successes Ipswitch Chef Kemp MarkLogic May 2019 Oct 2020 Nov 2021 Feb 2023 Price $225M $220M $258M $355M Revenue Multiple 3.0x 3.1x 3.6x 3.5x Pre-Acquisition Op Margins Mid-20s% Break-even Low 20s% Low 20s% Hitting Our Targets Pro Forma EBITDA Multiple <8x pro forma, post-synergies
Slide 13: 3. Drive Customer Success
3. Drive Customer Success B2B Technology Industrial Healthcare Financial Services B2C / Retail Ç ◊ Our Customer Everything we have—our people, technology, experience, and commitment to Commitment continuous innovation and investment—ensures our customer's success. © 2023 Progress Software Corporatio
Slide 14: Our Impact and Industry Relevance
Our Impact and Industry Relevance 1,700+ 3.5+M 6+M software companies strong developer business users work build their products on community with applications that run Progress technologies on Progress technologies 100s of 100s of Thousands Millions of enterprises run their of consumers use high-imp
Slide 15: Keys to Our Success
Keys to Our Success > Progress
Slide 16: Business Platform — Operational Excellence
Business Platform — Operational Excellence • Customer retention and success • Disciplined M&A methodology • Repeatable integration playbook • Optimized systems, infrastructure and processes • Expense management • Strong balance sheet and cashflow • Prudent capital allocation © 2023 Progress Software
Slide 17: Capital Allocation Strategy
Capital Allocation Strategy M&A Achieve strongest returns through disciplined M&A Buybacks Remain flexible, opportunistic Dividends Return capital directly to shareholders © 2023 Progress Software © Corporation 2023 Progress and/or Software its subsidiaries Corporationor affiliates. and/or its All s
Slide 18: People: Our Strongest Asset
People: Our Strongest Asset > Progress
Slide 19: Invest in Employee Development
Invest in Employee Development Career Growth Personal Care Workplace Flexibility Programs to help employees On-demand wellbeing Choice of where and how to achieve their professional and resources support employee work—in office, at home or a ÇÇ personal goals. Includes ÇÇ and financial mental, physi
Slide 20: Our Values
Our Values ProgressPROUD © 2023 Progress Software Corporation and/or its subsidiaries or affiliates. All rights reserved. 20
Slide 21: Corporate Social Responsibility Program
Corporate Social Responsibility Program Three primary focus areas: Our People Our Global Community Our Planet © 2023 Progress Software Corporation and/or its subsidiaries or affiliates. All rights reserved. 21
Slide 22: Progress Accolades
Progress Accolades © 2023 Progress Software Corporation and/or its subsidiaries or affiliates. All rights reserved. 22
Slide 23: Execution of Our Total Growth Strategy Led to Strong Stock Performance in 2022
Execution of Our Total Growth Strategy Led to Strong Stock Performance in 2022 PRGS — Relative Strength vs. Equity Indices PRGS — (%) Performance December 31, 2021 - December 30. 2022 December 31, 2021 - December 30, 2022 Source: NASDAQ © 2023 Progress Software Corporation and/or its subsidiaries or
Slide 24: Key Takeaways
Key Takeaways • Well-established trusted provider of mission-critical infrastructure software • Successfully executing Total Growth Strategy • Prudent capital allocation, focused on maximizing returns • Reliable, predictable and durable revenues, cash flow, operating income, and earnings • Sticky pr
Slide 25: Progress
D Progress
Slide 26: Disclosure Slides
Disclosure Slides Safe Harbor / Forward Looking Statements GAAP/non-GAAP Reconciliation
Slide 27: Forward Looking Statements
Forward Looking Statements This presentation contains statements that are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Progress has identified some of these forward-lookin
Slide 28: Important Information Regarding Non-GAAP Financial Information
Important Information Regarding Non-GAAP Financial Information Progress furnishes certain non-GAAP supplemental information to its financial results. We use such non-GAAP financial measures to evaluate our period-over-period operating performance because our management team believes that by excludin
Slide 29: Important Information Regarding Non-GAAP Financial Information
Important Information Regarding Non-GAAP Financial Information • Cyber incident - We exclude certain expenses resulting from the detection of irregular activity on certain portions of our corporate network, as more thoroughly described in the Form 8-K that we filed on December 19, 2022. Expenses inc