Slide 1: Investor & Analyst Presentation FY17 H1 Results
Investor & Analyst Presentation FY17 H1 Results For six months ended 31 December 2016 23rd February 2017 Rebekah O’Flaherty-CEO I Jonathan Kenny-CFO
Slide 2: Agenda
Agenda 1 2 3 4 5 6 Overview Strategic FY17 H1 FY17 Q&A Appendices Priorities Financial Outlook Update Results
Slide 3: Overview
Overview FY17 H1 Results Presentation 23 February 2017 1 3
Slide 4: FY17 H1 Results Highlights
FY17 H1 Results Highlights $M FY17 H1 FY16 H1 Mvmt Growth Revenue 25.1 22.9 2.2 10% Group Revenue grew by 10%. ANZ 15.7 13.5 2.2 16% EMEA 6.0 6.4 (0.4) (6%) Americas 3.4 3.0 0.4 13% EMEA and Americas impacted by FX on constant currency growth was 21% and 18% respectively. Mathletics 18.9 18.7 0.
Slide 5: Strategic Priorities Update
Strategic Priorities Update FY17 H1 Results Presentation 23 February 2017 2 5
Slide 6: 3 Year Strategic Priorities
3 Year Strategic Priorities Build upon 3P’s foundation of Talented team Strong customer advocates (students, parents and teachers) Award-winning product brands Recurring SaaS business model Large installed base to accelerate profitable global growth 2017 Strengthen Product Portfolio, Devel
Slide 7: Strategic Priority #1 Strengthen Product Portfolio
Strategic Priority #1 Strengthen Product Portfolio Focus on maths and literacy, the largest most synergistic education categories Goal Strategy Progress New Secondary Experience Launched late July 2016 New Primary Experience On track for Q4 FY17 launch Revitalize flagship Mathletics Brand
Slide 8: Evolution of Maths Category
Evolution of Maths Category More targeted product and price offers to improve retention, ARPU and customer acquisition cost Grades 7-10 Test Pro (B2B) Pro (B2C B2B) (B2C B2B) Grades 5-6 Test (B2B) Big Big Big (B2C B2B) (B2C B2B) (B2C B2B) Grades 3-4 (B2B) Junior Test Junior Junior (B2C B2B) (B2C B2B
Slide 9: Evolution of Literacy Category
Evolution of Literacy Category Aligned with maths category to improve multi product holding, retention and customer acquisition cost Grades 7-10 Grades 5-6 Writing Big Literacy Big B2C B2B Tests Big B2B B2C B2B B2B B2C B2B B2B Only Grades 3-4 Ex Ex Americas Americas Literacy Writing Junior Phonics T
Slide 10: Strategic Priority #2 Develop a Scalable Sale and Marketing Model
Strategic Priority #2 Develop a Scalable Sale and Marketing Model Leverage digital and telesales, as well as variable cost sales channels and pursue select geographic expansion Goal Strategy Progress Transitioning to lower cost telesales model for the USA underway, complete Replicate our success
Slide 11: Strategic Priority #3 Globalise our Operating Model
Strategic Priority #3 Globalise our Operating Model Standardise and simplify the operating model to enable efficient scalable growth Goal Strategy Progress Global banking platform for effective working Banking Platform capital management, control and efficient Complete processing Salesforce si
Slide 12: FY17 H1 Financial Results
FY17 H1 Financial Results FY17 H1 Results Presentation 23 February 2017 3 12
Slide 13: APAC – Growing leading market position
APAC – Growing leading market position APAC Financials Key Points $M FY17 H1 FY16 H1 Mvmt Growth Licence revenue growth of 21% benefited by Licence revenue 15.5 12.8 2.7 21% the rephrasing of billings of $1.8M (detailed Copyright fees, sponsorships and other 0.2 0.7 (0.5) (71%) on slide 28), under
Slide 14: EMEA – Growing margin and market share
EMEA – Growing margin and market share EMEA Financials Key Points £M FY17 H1 FY16 H1 Mvmt Growth Revenue 3.5 2.9 0.6 21% Strong revenue growth of 21% in GBP. (6%) Costs (1.5) (1.5) - 0% decline in $AUD EBITDA 2.0 1.4 0.6 43% Revenue growth supported by 18% gain in EBITDA margin (%) 57% 48% 18% u
Slide 15: Americas – Efficient and scalable sales model
Americas – Efficient and scalable sales model Americas Financials Key Points US$M FY17 H1 FY16 H1 Mvmt Growth Revenue growth of 18%. 13% in $AUD Revenue 2.6 2.2 0.4 18% Costs (2.8) (2.6) (0.2) 8% Revenue growth supported by 1% gain in EBITDA (0.2) (0.4) 0.2 50% licences. Licence numbers impacted
Slide 16: Learnosity – delivering growth
Learnosity – delivering growth Learnosity Financials Key Points US$ FY17 H1 FY16 H1 Mvmt Growth Revenue 5.9 4.5 1.4 31% Revenue growth of 31% to US$5.9M reflecting Underlying EBITDA 0.4 1.0 (0.6) (60%) growing global demand for online Underlying NPAT 0.4 1.0 (0.6) (60%) assessment. Strong growth i
Slide 17: FY17 H1 – Income Statement
FY17 H1 – Income Statement $M FY17 H1 FY16 H1 Mvmt Growth Key Points Total Revenue 25.1 22.9 2.2 10% Headcount has declined to 307 from 338 as at June Employee (11.7) (10.1) (1.6) (16%) 16 and expect to decline to 250 by June 17. As at Marketing (0.8) (1.6) 0.8 50% Dec 2015 it was 284. The benefit
Slide 18: FY17 H1 – Cash flow
FY17 H1 – Cash flow $M FY17 H1 FY16 H1 Mvmt Key Points Underlying Core EBITDA 8.5 7.3 1.2 Revenue growth, cost containment and Non-cash expense (0.4) (0.4) - strong working capital management have Change in working capital (10.7) (10.6) (0.1) improved operating free cash flows by $1.1M. Operating
Slide 19: FY17 H1 – Balance sheet
FY17 H1– Balance sheet $M 31-Dec-16 30-Jun-16 31-Dec-15 Key Points Cash and cash equivalents 4.2 4.3 3.1 Trade and other receivables 23.9 8.0 8.2 Net debt of $20.3M (peaks in December) of total Income tax receivable - 0.0 1.0 debt facility of $30M. Total current Assets 28.1 12.3 12.3 Royalty recei
Slide 20: Strategic Review of Technology Assets
Strategic Review of Technology Assets Intangibles and Amortisation Profile $M Carrying Value Additions Amortisation Impairment Carrying Value 30-Jun-16 31-Dec-16 Key Points Mathletics & Spellodrome 14.6 4.3 (2.2) (8.4) 8.3 IntoScience 3.3 0.1 (0.5) (2.9) - Strategic review of technology assets Syste
Slide 21: FY17 Outlook
FY17 Outlook FY17 H1 Results Presentation 23 February 2017 4 21
Slide 22: H2 FY17 Outlook
H2 FY17 Outlook Continued focus and execution of our 3 strategic priorities: (i) strengthen product portfolio, (ii) develop scalable sales and marketing and (iii) globalise our operating model Continue to deliver revenue growth greater than cost growth Set up 3P to be a Global Digital Business
Slide 23: Q&A
Q&A FY17 H1 Results Presentation 23 February 2017 5 23
Slide 24: Appendices
Appendices FY17 H1 Results Presentation 23 February 2017 6 24
Slide 25: Revenue by Geography and Product
Revenue by Geography and Product Revenue by Geography Revenue split by Geography A$M FY12 FY13 FY14 FY15 FY16 FY17 H1 FY16 H1 Growth FY17 H1 FY16 H1 APAC 22.2 24.2 24.6 30.1 30.8 15.7 13.5 16% EMEA 4.5 5.5 8.6 10.3 12.6 6.0 6.4 -6% Americas 1.7 2.3 3.3 4.4 5.9 3.4 3.0 13% 63% 59% Total 28.5 32.0 36.
Slide 26: Licences by Geography and Product
Licences by Geography and Product Licences by Geography Licences split by Geography 000s FY12 FY13 FY14 FY15 FY16 FY17 H1 FY16 H1 Growth APAC 2,236 2,500 2,524 2,696 2,733 2,875 2,853 1% FY17 H1 FY16 H1 EMEA 912 1,005 1,480 1,685 1,854 2,047 * 1,742 17% Americas 316 358 662 931 1,065 979 970 1% Tota
Slide 27: Statutory EBITDA
Statutory EBITDA Reconciliation of Segment EBITDA to Statutory EBITDA $M FY17 H1 FY16 H1 Mvmt Growth APAC EBITDA 11.5 9.2 2.3 25% Less : Corporate Costs and Development (6.5) (5.3) (1.2) (23%) Add : Intersegment royalties 3.6 3.4 0.2 6% Statutory EBITDA 8.6 7.3 1.3 18% EMEA EBITDA 3.6 3.1 0.5 16% Le
Slide 28: Subscription Billing with Auto Renewal - Improves Retention
Subscription Billing with Auto Renewal - Improves Retention Revenue seasonality (A$M) To improve retentions we have moved to a subscription billing model with auto renewals. This has changed the timing of customer invoicing to November (previously Jan)in Australia resulting in increased accounts r
Slide 29: FY17 H1 Results Presentation 23 February 2017
The material in this presentation is a summary of 3P Learning Limited’s (‘3P’) activities and results as at the time of preparation, 23 February 2017. No representation, express or implied, is made as to the fairness, accuracy, completeness or correctness of information contained in this presentatio