Technology One Limited · ASX:TNE
Technology One — UBS Australian Emerging Companies Conference 2012
50 slides from Technology One's conference presentation, Apr 4, 2012
Slide 1: ASX cover letter: Presentation to UBS Conference
Commercial in Confidence For personal use only 4 April 2012 The Manager Company Announcements Platform Australian Stock Exchange Dear Sir, Technology One Limited – Presentation to UBS Australian Emerging Companies Conference Please find attached for release to the market a presentation to be given b
Slide 2: ASX announcement: UBS Presentation
For personal use only ____ __Technology ____ _____ One ____ Ltd UBS ______ Presentation _____ _____ 4 ____ _____ April 2012 - Technology One Ltd (ASX:TNE) today conducted a _____ _____ presentation at the UBS Emerging Companies conference. ____ The _____ attached presentation was given at this meeti
Slide 3: UBS Emerging Companies Conference
For personal use only UBS Emerging Companies Conference Adrian Di Marco Adrian_Dimarco@TechnologyOneCorp.com Final Commercial in confidence April 2012
Slide 4: Agenda
For personal use only Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 5: TechnologyOne is an enterprise software vendor
For personal use only ____ __ ____ _____ ____ ______ _____ _____ ____ _____ TechnologyOne is an enterprise software vendor _____ _____ ____ _____
Slide 6: TechnologyOne Overview: products
TechnologyOne Overview Our enterprise solution consists of the following products: For personal use only Financials ____ __ ____ Supply Chain _____ ____ ______ _____ _____ Asset Management ____ _____& Payroll Human Resource Corporate Performance Management _____ _____ • Business Intelligence
Slide 7: The Competitive Landscape
The Competitive Landscape For personal use only New expanding market coverage ORACLE SAP/R3 ____ __ ____ _____ ____ ______ $1,000m _____ _____ Current market coverage ____ _____ TechnologyOne _____ _____ $100m ____ _____ Microsoft Business Solutions SAP/Business One Infor (Sun Systems) $30m Reckon C
Slide 8: TechnologyOne targets seven vertical markets
For personal use only TechnologyOne Overview TechnologyOne targets seven vertical markets: ____ __Government • Local ____ _____ ____ ______ _____ _____ • Government (State, Central and Federal) ____ _____ • Education _____ _____ • Financial Services ____ _____ • Health, Community Services and Not fo
Slide 9: 900+ High Profile Customers
For personal use only 900+ High Profile Customers ____ __ ____ _____ ____ ______ _____ _____ ____ _____ _____ _____ ____ _____
Slide 10: TechnologyOne Overview
For personal use only TechnologyOne Overview Offices in Australia, New Zealand, ____ Asia and __ more____ recently, _____ ____ ______ South Pacific and _____the United Kingdom (UK) _____ ____ One _____largest software of Australia’s houses _____ _____ Specialise in the research, ____ _____ dev
Slide 11: TechnologyOne Overview: diversity of revenue streams
TechnologyOne Overview Diversity of revenue streams from multiple: For personal use only ____ __ ____ _____ ____ ______ • Geographies _____ _____ – All states of Australia, New Zealand, Asia and more recently UK • Products ____ _____ – Financials, HR/Payroll, SupplyChain, Asset Management, Property,
Slide 12: Historical Performance: strong financial track record
Historical Performance Strong financial track record … For personal use only ____ Doubling__ ____ in size _____ approx every ____ 4 years ______ for 15 years _____ Continually_____ profitable since 1992 (20 years) ____ Revenue _____ Continually paid dividend since 1996 (16 years) _____ Cash
Slide 13: Historical Performance: key metrics
Historical Performance Key metrics over last 15 years … For personal use only 80 ____ -__ Revenue 22%____ per annum_____ compound____ ______ 70 _____ _____ 60 Even through the Dot-Com and GFC 50 ____ Initial _____ Licence Fees - 22% per annum compound $'m 40 _____ Annual _____ Licence Fees -
Slide 14: Agenda
For personal use only Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 15: Revenue Model
For personal use only Revenue Model Initial Licence - based on usage ____ __of ____ • Matrix _____ licensable modules ____ (approx ______ 300 modules over 10 products), number of users _____ • Once _____ off ____ _____ Services - fee for service Implementation _____ • $1.20 _____ Services : $1 I
Slide 16: Revenue Model
Revenue Model Initial Implementation Annual Annual Annual For personal use only Initial Licence Service Licence Licence Licence …. ____ __ ____ Purchase _____ ____ ______ _____ _____ -Specified: Products, Modules, No of Users ____ _____ Initial Annual Annual Annual Increase Licence Licence Licence L
Slide 17: Revenue Model: customers have 3 products on average
For personal use only Revenue Model ____ __ ____ _____ ____ ______ _____ _____ ____ _____ On average _____ _____our customers have 3 products (out of ____ a product range of 10) _____
Slide 18: Strong, very loyal blue chip customer base
TechnologyOne Overview Strong, very loyal blue chip For personal use only FY11 New Other ____ __base customer ____ _____ ____ ______ Non-Recurring ** 9% New Licence _____ _____ • We provide a mission 8% critical solution – ‘sticky ____ _____ customer base’ _____ • 66% of_____ Existing 66% our revenu
Slide 19: Agenda
For personal use only Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 20: What Makes Us Different
For personal use only What Makes Us Different Enterprise Suite ____ __ ____ _____ ____ ______ • One of a few companies globally with an enterprise solution _____ Own the_____ IP to our software, which allows us to control our ____ future_____ _____ _____ model - Power of One Unique business __
Slide 21: What Makes Us Different: seven vertical markets
For personal use only What Makes Us Different Our focus on seven key vertical markets ____ • Deep__ ____ of _____ understanding ____ our target seven ______ markets _____ _____ • Understand their value drivers • Know the universe of opportunities in each of our market ____ _____ Preconfigured so
Slide 22: Preconfigured Solutions
What Makes Us Different 14 Preconfigured Solutions … For personal use only One Government ____ __ ____ _____ ____ ______ One Not For Profit _____ _____ One Council One Grant ____ _____ One Housing One Network _____ _____ One Health One Water ____ _____ One Port One Polytechnic One
Slide 23: Agenda
For personal use only Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 24: Strategic Initiatives
For personal use only Strategic Initiatives ____ __ ____ _____ ____ ______ New Offshore R&D Centre _____ _____ ____ _____ Compelling Customer Experience _____ _____Cloud TechnologyOne ____ _____
Slide 25: New Offshore R&D Centre
For personal use only New Offshore R&D Centre R&D centre in Brisbane with 500+ staff ____ New __R&D offshore ____ centre_____ to handle____ ______ future growth _____ _____ To contain costs – operating leverage of offshore ____ _____ R&D staff _____ _____ To tap into a new pool of R&D talent out
Slide 26: Strategic Initiatives
For personal use only Strategic Initiatives ____ __ ____ _____ ____ ______ New Offshore R&D Centre _____ _____ ____ _____ Compelling Customer Experience _____ _____Cloud TechnologyOne ____ _____
Slide 27: Compelling Customer Experience (CCE)
Compelling Customer Experience (CCE) Customer retention is critical to our future For personal use only success ____ __ ____ _____ ____ ______ Future of ERP is all about customer retention _____ _____ ____ _____ Our focus is to give our customers a compelling customer experience _____ _____ ____
Slide 28: Strategic Initiatives
For personal use only Strategic Initiatives ____ __ ____ _____ ____ ______ New Offshore R&D Centre _____ _____ ____ _____ Compelling Customer Experience _____ _____Cloud TechnologyOne ____ _____
Slide 29: Today – On Premise
For personal use only Today – On Premise Database Server ____ __ ____ _____ ____ ______ _____ _____ Citrix Servers N-tier Application Servers Distributed Processors ____ _____ client _____ _____ ____ _____ Installation Servers A complex computing model
Slide 30: The Future – The Cloud
The Future – The Cloud For personal use only Off Premise ____ __ ____ _____ ____Service ______Provider _____ _____ ____ _____ client Internet connection _____ _____ ____ _____ A simpler computing model
Slide 31: TechnologyOne Cloud
For personal use only ____ __ TechnologyOne Cloud ____ _____ ____ ______ _____ _____ ____ _____ _____ _____ TechnologyOne Enterprise Suite in the cloud ____ _____ today, delivered via the browser... TechnologyOne takes care of everything
Slide 32: TechnologyOne Cloud: yearly subscription fee
TechnologyOne Cloud For personal use only TechnologyOne takes care of everything for a Yearly Subscription Fee… ____ __ ____ _____ ____ ______ Hardware, Operating Software, Middle ware etc.. _____ _____ Backup ____ Services _____ _____ _____ Replication Services & Disaster Recovery ____ _____
Slide 33: Cloud
Cloud For personal use only ____ __ ____ _____ ____ ______ _____ _____ ____ _____ _____ _____ ____ _____
Slide 34: Agenda
For personal use only Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 35: Newer Products, Increased Up take
For personal use only Newer Products, Increased Up take Enterprise Content HR/Payroll CRM ____ __ ____ _____ ____ ______ Mobile Solutions Management 4% 3% <1% Future Property 4% _____ _____ Growth Asset Management 6% CPM 31% CPM … as____ newer _____ 8% Financials & Supply Chain _____ _____ Student M
Slide 36: Newer Vertical Markets, Increased Penetration
Newer Vertical Markets, Increased Penetration For personal use only ____ Future __ ____ Growth _____ ____ ______ ...as _____ _____ we increase ____ _____ our penetration _____ _____ in newer vertical markets ____ _____ 71% Licence Fees come from Local Gov, Education and Health/Community
Slide 37: Newer Geographies
For personal use only Newer Geographies Future ____ __ ____ _____ ____ ______ Growth _____ _____ …as the UK ____ _____ moves thru _____ _____ the GFC ____ _____ UK has significant potential growth for us in future years
Slide 38: Cross Sell into Existing Customer Base
For personal use only Cross Sell into Existing Customer Base ____ Cross sell__ ____ more _____ products into our____ large ______ _____ existing_____ customer base ____ _____ 900 customers _____ _____ On average our customers have 3 products ____ (out of_____ 10)
Slide 39: Future Growth – Acquisitions
For personal use only Future Growth – Acquisitions Acquisitions – not a high priority at this time ____ Acquire__ New____ _____ Customers ____ - cross sell ______ our existing products into _____ _____ Acquire New Products - cross to sell into our existing customers ____ _____ Existing Products (
Slide 40: Future Growth – ERP Replacement Cycle
Future Growth – ERP Replacement Cycle ERP Replacement Cycle of 10 to 15 years For personal use only ____ Name of__the____ _____ game is those ____ that keep their______ customers versus those that will lose customers _____ _____ ____ _____because of... Well positioned _____ _____ Our Power Of
Slide 41: Future Growth Timeline
Future Growth Timeline ... For personal use only Cross selling into our large customer base now ____ __ ____ _____ ____ ______ _____ _____ Newer products – increased uptake now ____ _____ Newer vertical markets – increased penetration now _____ _____ Cycle ERP Replacement now ____ _____ Newer
Slide 42: Agenda
For personal use only Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 43: Improved Margins
For personal use only Improved Margins Profit margin has contracted over the last ____ 10 years__ ____ _____ ____ ______ _____ _____ Expanded our product range investment ____ Profit _____ margin now stabilised _____ Focus is to_____ substantially improve margins ____ over next_____ five years
Slide 44: New Products Contribution to Profit
New Products Contribution to Profit New Products Increase Profits For personal use only Profit Contribution - Product - FY11 • ____ __ Opportunity ____ grow to substantially _____ the ____ ______ Asset Management ECM, CRM, contribution to profit by these Property HR/Payroll, Mobile _____ over _____
Slide 45: Control of R&D Costs
For personal use only Control of R&D Costs Control of R&D costs … ____ __ ____ _____ ____ ______ _____ _____ ____ _____ Compound Growth 16% _____ _____ ____ _____ leveraging Offshore R&D to achieve substantial savings
Slide 46: R&D Growth Projections
R&D Growth Projections Model R&D growth over the next 5 years at 8% per annum For personal use only • R&D currently projected to be $67m in year 5 (compared to $33.5m now) ____ __ ____ _____ ____ ______ • In year 5 our R&D will be $47m vs $67m, saving of $20m in one year _____ _____ • Saving of $52m
Slide 47: Agenda
For personal use only Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 48: Long Term Outlook
Long Term Outlook Long Term Outlook is Strong ..... For personal use only Enterprise Suite – one of a few companies globally with an enterprise solution ____ Power __– unique of One ____ _____ approach ____ to build, market,______ sell, implement and support our products _____ Vertical _____ m
Slide 49: Long Term Outlook
For personal use only Long Term Outlook Geographical expansion – United Kingdom has significant longer term growth ____ Our __Customer Compelling ____ Experience _____program ____– ______ retain our customers _____ New _____ offshore R&D centre – provide access to additional talent and operati
Slide 50: UBS Emerging Companies Conference
For personal use only UBS Emerging Companies Conference Adrian Di Marco Adrian_Dimarco@TechnologyOneCorp.com Commercial in confidence April 2012
Technology One — UBS Australian Emerging Companies Conference 2012 on 6ix