Slide 1: Results Presentation Half Year Ended June 2008
For personal use only Results Presentation Half Year Ended June 2008 Clive Rabie – Group CEO Chris Hagglund – Group CFO Brian Armstrong – CEO Professional Division Gavin Dixon – CEO Business Division 1
Slide 2: Overview
For personal use only Overview • Reckon is taking strong strides towards achieving its mission: “to be the leading Australian provider of best of breed: – Accounting Software and solutions suitable up to 30 concurrent users – Practice Management Solutions for the accounting industry & other professi
Slide 3: For personal use only
For personal use only *Products managed and reported under the business division 3
Slide 4: Performance Highlights
For personal use only Performance Highlights – 6 month ended June 2008 Reckon Group Revenue up 11% to $31.5m EBITDA up 15% to $9.4m NPAT up 12% to $5.6m Professional Division Business Division Operating revenue up 13% to $10.6m Operating revenue up 10% to $20.6m EBITDA up 29% to $2.6m EBITDA up 10%
Slide 5: Performance Highlights
For personal use only Performance Highlights – 6 month ended June 2008 – Operating cash flow up 20% to $8.2m – Interim dividend of 2.5 cents per share – Dividend franked to 100% – EPS growth 12% to 4.2 cents 5
Slide 6: Trends over last years
For personal use only 6 month trends over last 5 years 2004 2005 2006 2007 2008 Revenue 18.8m 21.2m 23.2m 28.4m 31.5m Cumm Growth 68% EBITDA 4.2m 5.5m 6.7m 8.2m 9.4m Cumm Growth 124% NPBT 4.1m 5.2m 5.8m 6.7m 7.5m EPS 2.2 2.5 3.3 3.8 4.2 cents* cents cents Cents Cents * Normalised for tax 6
Slide 7: Margin trends over years
For personal use only Margin trends over 4 years 2005 2006 2007 2008 EBITDA (pre R&D and Royalties) 8.9m 10.0m 11.8m 13.2m Margin 40% 43% 42% 42% EBITDA 5.5m 6.7m 8.2m 9.4m Margin 25% 29% 29% 30% The current year has been positively impacted by: • Significantly lower 3rd party product sales in the P
Slide 8: Cash Flow Highlights
For personal use only Cash Flow Highlights – half year ended June 2008 2008 2007 Cash Balance at June 2008 $15.2m Operating cash flow1 $8.2m $6.8m +20% Acquisitions $0.1m $2.3m Development Cost Expenditure2 $2.3m $1.8m Fixed Asset Acquisitions $0.3m $0.3m Dividends Paid $4.0m 3.3m 1 Tax payments wil
Slide 9: Revenue Breakdown
For personal use only Revenue Breakdown – year ended June 2008 1 00 % 90 % 80 % 70 % 58% 5 8% 5 8% 60 % R ecu rring R eve n ue 50 % F u ll Pro du ct Se rvice Re ven ue 40 % 18% 30 % 2 5% 2 8% 20 % 24% 10 % 1 7% 1 4% 0% APS Q u icke n G rp Re cko n Prior year 57% 57% 57% recurring revenue 9
Slide 10: Acquisition Update
For personal use only Acquisition Update • On 10th June 2008 the group announced that it had signed a cooperation agreement in respect of the potential acquisition of the Corporate Services and Cost Recovery business of Espreon Limited • The Corporate Services business is a provider of documentation
Slide 11: Professional Division
For personal use only Professional Division 11
Slide 12: Professional Division – half year ended June 2008
For personal use only Professional Division – half year ended June 2008 2008 2007 Operating Revenue $10.6m $9.4m Operating revenue growth 13% New sales & service revenue growth 8% Recurring revenue growth 16% EBITDA $2.6m $2.0m EBITDA growth 29% 12
Slide 13: Professional Division - 2008 Highlights
For personal use only Professional Division - 2008 Highlights • Strong organic growth • Continued success with top 300 firms • Two Big Four firms successfully implemented • Consolidated our position as the supplier of choice to leading firms • Significant demand for additional services by large clie
Slide 14: Professional division – Half year ended June 2008
For personal use only Professional division – Half year ended June 2008 Software revenue • Continued growth in all geographies on the back of a strong previous half • Australia showing particularly strong growth Consulting revenue • Starting to see the contribution from the expanded G row in g M ain
Slide 15: Professional Division - Strong revenue growth
For personal use only Professional Division - Strong revenue growth Australia • Strong new business – up 23% • 52 new firms switched to APS • Major wins include 9 New Top 100 Firms • Strong uptake of Desktop Super – 35 new firms • 86% of clients using 3 or more products New Zealand • Major win – Big
Slide 16: APS Integrated Solution
APS Integrated Solution. For personal use only Financial Management Business & Payroll Intelligence Professional Accounting Document Management Practice Management Workflow & Resource Tax Management Compliance Client Relationship Management Desktop Super Business Process Automation Company 16 Secret
Slide 17: Reckon Limited Integrated Compliance Solutions
Reckon Limited Integrated Compliance Solutions 17
Slide 18: Practice software with human beings bundled in
Reckon Limited Practice software with human beings bundled in. a, The ultimate ractice software has arms, legs and a brain. Practice software without people? That'll be our competition. 18
Slide 19: Business Division
For personal use only Business Division 19
Slide 20: Business Division – half year ended June 2008
For personal use only Business Division – half year ended June 2008 2008 2007 Operating Revenue $20.6m $18.7m Operating revenue growth 10% Recurring revenue growth 11% Full product growth 7% Service revenue growth 12% EBITDA $6.8m $6.2m EBITDA growth 10% 20
Slide 21: Business Division - 2008 1st Half Highlights
For personal use only Business Division - 2008 1st Half Highlights • Successful launch of QuickBooks 2008 QB i Series – Growth of revenue in the Enterprise space +24% • Top Australian Software awards won in QuickBooks, POS and Personal • Continued success with Elite products – Over 193 practices swi
Slide 22: Business Division Key Strategies
For personal use only Business Division Key Strategies • Leverage our advantages with the release of QuickBooks 2008 QB i Series • Enterprise Solutions • Industry Solutions • Leverage recent acquisitions • Release Shelco product integrated into APS and Elite • Release company secretarial products in
Slide 23: Future Opportunities
For personal use only Future Opportunities • Continued organic growth • Professional division – Order book remains strong • Business division focus – leverage QBi • Improve results from NZ Business Division • Roll out Shelco company secretarial products • Roll out of integrated compliance offering •
Slide 24: Questions
For personal use only Questions Thank you 24