Aptitude Software Group Plc · LSE:APTD
Aptitude Software — Microgen — FY2016 Earnings Presentation
29 slides from Aptitude Software's earnings presentation, Mar 8, 2017
Slide 1: 2016 Audited Preliminary Results
microgen 2016 AUDITED PRELIMINARY RESULTS Year ended 31 December 2016 8 March 2017
Slide 2: Group Overview
microgen GROUP OVERVIEW Across its two operating businesses Microgen develops, implements and supports business-critical software and related services Specialised Financial Trust & Fund Administration, Management Software Payments and Application Applications Management 2 8 March 2017 | Audited Prel
Slide 3: Strategic Focus
STRATEGIC FOCUS • Aptitude Software: - Acceleration of organic growth by focusing specialised financial management software applications - Continue to strengthen growth by focusing and leveraging the existing expertise in high volume transaction sectors where complex detailed accounting is required
Slide 4: Group Highlights
GROUP HIGHLIGHTS • Excellent progress by the Group’s two businesses in line with the declared strategy • Revenue growth of 35%, adjusted operating profit increased by 26% • Strong organic growth by Aptitude Software driven by demand for its specialised financial management software applications in b
Slide 5: Financial Review
FINANCIAL REVIEW Year ended December 2016 8 March 2017
Slide 6: 2016 Results
2016 RESULTS Revenue Adjusted operating profit £43.0m £9.5m 35% (29% C/C*) 26% (12% C/C) (2015: £32.0m) (2015: £7.6m) Adjusted Full year EPS dividend 12.3p 5.0p * C/C = Constant currency growth, 34% 19% calculated by comparing 2015 results with 2016 results retranslated at the (2015: 9.2p) (
Slide 7: Excellent Progress in Both Businesses
EXCELLENT PROGRESS IN BOTH BUSINESSES Aptitude Software 30 revenue £26.4m 25 58% (48% C/C) 20 (2015: £16.7m) Revenue (£m) 15 Microgen Financial Systems 10 revenue 5 £16.6m 9% 0 Aptitude Software Revenue Microgen Financial Systems Revenue (2015: £15.2m) 2014 2015 2016 7 8 March 2017 | Audited Pre
Slide 8: Income Statement
INCOME STATEMENT 2016 2015 £’000 £’000 Aptitude Software Revenue 26,364 16,730 Microgen Financial Systems Revenue 16,624 15,228 Total Revenue 42,988 31,958 Aptitude Software Adjusted Operating Profit 3,842 1,664 Microgen Financial Systems Adjusted Operating Profit 7,219 7,247 Group Costs (1,536) (1,
Slide 9: Balance Sheet
BALANCE SHEET 2016 2015 £’000 £’000 Goodwill and intangible assets 49,031 47,708 Property, plant and equipment 1,330 928 Trade and other current assets 9,209 5,225 Cash and cash equivalents 23,849 18,600 Assets classified as held for sale - 2,350 Total Assets 83,419 74,811 Bank loan (10,250) (13,250
Slide 10: Cash Flow Statement
CASH FLOW STATEMENT 2016 2015 £’000 £’000 Cash generated from operations 13,032 7,495 Interest and tax paid (2,457) (1,681) Cash flows generated from operating activities 10,575 5,814 Purchase of property, plant and equipment (894) (524) Proceeds from sale of fixed assets 2,352 13 Acquisition of sub
Slide 11: Slide 11
Slide 12: Product Suite
PRODUCT SUITE • The Aptitude Software business provides a series of highly specialised finance management software applications which been developed on the Aptitude technology platform • The Aptitude technology platform is an enterprise level application platform which facilitates the very rapid pro
Slide 13: Aptitude Software Regional Highlights
NORTH AMERICA UNITED KINGDOM & ROI MAINLAND EUROPE REST OF THE WORLD 3 of the 4 largest telcos now Aptitude Revenue Recognition Aptitude Allocation Engine and A number of Asian telcos now licenced for the Aptitude Engine implementation at Accounting Hub licenced for the Aptitude Revenue Recognition
Slide 14: 2016 Financial Highlights
2016 FINANCIAL HIGHLIGHTS Organic revenue Operating profit Increasing proportion of growth growth US Dollar revenues £26.4m £3.8m 53% 58% 131% (2015: £16.7m) (2015: £1.7m) (2015: 38%) Revenue on a constant Operating profit on a Recurring revenue currency basis constant currency basis base growth
Slide 15: 2016 Financial Highlights: Software and Implementation Revenue
2016 FINANCIAL HIGHLIGHTS Software 30 revenue growth 25 £12.4m 38% 20 Revenue (£m) (2015: £9.0m) 15 Implementation revenue 10 growth £14.0m 5 82% 0 2014 2015 2016 (2015: £7.7m) Software revenue Implementation revenue 15 8 March 2017 | Audited Preliminary Results
Slide 16: Case Study #1: Asia Telco Operator
CASE STUDY #1 20 million subscriber operator - 20 million mobile largest in country, for which subscriber operator ASIA TELCO OPERATOR Aptitude Software now has very high market share for revenue APTITUDE REVENUE recognition. Complex billing and RECOGNITION ENGINE revenue recognition Highly complex
Slide 17: Case Study #2: US Healthcare Company
CASE STUDY #2 Contract signed in January 2017. January 2017 US Strategic to both client and contract US HEALTHCARE COMPANY Aptitude Software APTITUDE ACCOUNTING HUB ERP vendor general ledger could APTITUDE PLATFORM not keep up with business New sector with further complexity and volume. Client oppor
Slide 18: Strategy and Outlook
STRATEGY AND OUTLOOK • Aptitude Software continues to benefit from the increased focus on the deployment of its specialised financial management software applications • New geographic markets and new sectors have been opened with Aptitude Software’s existing applications. Further penetration of thes
Slide 19: Financial Systems
Financial Systems
Slide 20: Product Suite
PRODUCT SUITE • Building an increasingly strong presence in the Trust & Fund Administration (‘T&FA’) sector with in excess of 350 customers in over 30 countries • Over 50% of revenues now from T&FA sector. Payments and Application Management businesses continue in line with expectations • The Microg
Slide 21: T&FA Customers by Region
Over 350 T&FA customers in over 30 countries UK & CHANNEL ISLANDS EUROPE REST OF WORLD New business sales together with a number Acquisition of Infoscreen and its New client secured with multi-office T&FA of upgrades to Microgen 5Series from predominantly Cypriot client base, a market organisation t
Slide 22: 2016 Financial Highlights
2016 FINANCIAL HIGHLIGHTS Revenue Adjusted operating profit £16.6m £7.2m 9% (2015: £15.2m) (2015: £7.2m) T&FA proportion of Recurring revenue revenue increasing proportion 54% 80% (2015: 43%) (2015: 83%) 22 8 March 2017 | Audited Preliminary Results
Slide 23: 2016 Financial Highlights: Revenue by Line
2016 FINANCIAL HIGHLIGHTS 18 T&FA revenue growth £8.9m 37% 16 14 (2015: £6.5m) 12 Revenue (£m) Payments revenue growth 10 £1.5m 15% 8 6 (2015: £1.3m) 4 App Man managed decline 2 £6.2m ↓ 16% 0 2014 2015 2016 (2015: £7.4m) T&FA Payments Application Management 23 8 March 2017 | Audited Preliminary
Slide 24: Acquisition Overview
ACQUISITION OVERVIEW • Five acquisitions completed since December 2014 including Infoscreen (May 2016) and Primacy (February 2017) • Key element of acquisition strategy is the ability to secure both services and licence uplift fees if customers choose to migrate to Microgen 5Series from the acquired
Slide 25: T&FA Growth
T&FA GROWTH • Revenue increased 37% to £8.9 million (2015: £6.5 million) • Microgen 5Series revenues within T&FA have increased to £6.6 million (2015: £5.0 million) benefitting from both new name customer wins and conversions to Microgen 5Series from the T&FA acquisitions completed since December 20
Slide 26: Case Study: International Wealth Management Services Provider
CASE STUDY Microgen 5Series will be deployed across the customer’s User of one of Microgen’s recently INTERNATIONAL WEALTH UK, Swiss and Caribbean offices MANAGEMENT SERVICES as the key business system for acquired products PROVIDER its trust and corporate services administration activities MICROGEN
Slide 27: Strategy and Outlook
STRATEGY AND OUTLOOK • Transition to a business which is focused on the Trust & Fund Administration (‘T&FA’) market through both organic and inorganic growth • Combination of organic and inorganic growth is further enhancing our already strong market positioning in T&FA sector • Benefits from add-on
Slide 28: Group Outlook
GROUP OUTLOOK Year ended 31 December 2016
Slide 29: Group Outlook
GROUP OUTLOOK • Strong progress in 2016 for both businesses, successfully executing on strategic plans • Continued organic growth strengthened by increasing recurring revenues and scale from strategic add-on acquisitions • Expanding global footprint and entry into new industry verticals • Good forwa