Descartes Systems Group Inc. · TSX:DSG
Descartes Systems — The Descartes Systems Group — Investor Presentation (September 2020)
21 slides from Descartes Systems's investor presentation, September 2020
Slide 1: Descartes – Uniting Business in Commerce
Descartes – Uniting Business in Commerce September 2020 Proprietary and Copyright of The Descartes Systems Group Inc. All rights reserved.
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements to be made today and in this presentation, and that may be made in response to questions, constitute forward-looking information for the purposes of applicable securities laws (“forward-looking statements”), including, but not limited to: statements using the
Slide 3: Investment Highlights
Investment Highlights World’s Largest Multi-Modal and Neutral Logistics Network Cloud-Based Software Applications and Data Content Automating and Optimizing the Increasingly Complex Logistics Market Strong Market Position with Significant Competitive Barriers Disciplined M&A Strategy Highly-Experien
Slide 4: Descartes at a Glance
Descartes at a Glance Revenues (US$ millions) 326 275 Leader in providing SaaS solutions for logistics-intensive 237 businesses Proven ‘Total Growth’ model supported by disciplined acquisition strategy High-recurring revenue profile FY18 FY19 FY20 Net Income & Adj. EBITDA (US$ millions)(1) D
Slide 5: Global Logistics Network
GLOBAL LOGISTICS NETWORK CARRIERS SHIPPERS Ocean Air Ground Rail Retailers Manufacturers Service & Distributors Providers DESCARTES GOVERNMENTS INTERMEDIARIES GLN™ Customs Regulators Associations Customs Freight Forwarders Brokers Brokers & 3PLs 5
Slide 6: Solutions
SOLUTIONS Ecommerce, Shipping Global Trade Transportation & Fulfillment Intelligence Broker & Forwarder Routing, Mobile Management Enterprise Systems Customs & & Telematics Regulatory Compliance DESCARTES GLN™ 6
Slide 7: Industry-Leading Customers
Industry-Leading Customers AIR OCEAN TRUCK INTERMEDIARIES R E TA I L E RS M A N U FA C T U R E RS D I S T R I B U TO RS 7
Slide 8: Customer Case Studies
Customer Case Studies Leverages Descartes’ Advanced Home Leverages many Descartes solutions Descartes’ solutions help Delta Airlines Delivery solution for: across multiple DHL operating groups: meet a growing number of logistic challenges across the globe: Real-time delivery appointment Global F
Slide 9: Why We Win
Why We Win Global Multi- Neutral modal Network Pure play logistics technology provider with compelling combination of network, applications and data content 9
Slide 10: Market Drivers and Opportunities
Market Drivers and Opportunities Cloud Enables Global Logistics Network offers operational excellence, increased digitization of freight and higher precision through Automation cloud integration and automation G l o b a l Tra d e Heightened regulatory compliance requirements and shifting global trad
Slide 11: M&A is a Core Competency for Descartes
M&A is a Core Competency for Descartes Descartes’ acquisition strategy is a key enabler of its ‘Total Growth’ model Has completed 24 acquisitions since 2014 for a total consideration of ~US$ 820 million Disciplined approach that is focused on complementary technologies, industry 2014 2015 2016 2
Slide 12: Recent Acquisition Success
Recent Acquisition Success Acquired February 2020 for ~£19mm Acquired February 2019 for ~$250mm Acquired February 2017 for ~$107mm (~$25mm) Cloud-based ecommerce warehouse Cloud-based global trade data content Electronic transportation network providing management (eWMS) solution provider prov
Slide 13: Financial Overview
Financial Overview DESCARTES 13
Slide 14: Financial Highlights
Financial Highlights Strong and consistent revenue growth Highly-recurring subscription and transaction-based revenue model High-quality and diverse revenue profile Continued margin expansion through cost control and operating efficiency Robust cash generation and high conversion rates Proven acquis
Slide 15: Strong and Consistent Growth
Strong and Consistent Growth Revenue Cash Flow from Operations $326 $104 $275 $78 $237 $72 $34 $81 $84 $27 FY18 FY19 FY20 Q2-20 Q2-21 FY18 FY19 FY20 Q2-20 Q2-21 Net Income and Net Income as a % of Revenues Adjusted EBITDA(1) and Adjusted EBITDA as a % of Revenues(1) $40 $37 100.0% $35 $31 90.0% 80.0
Slide 16: Efficient and Disciplined Operating Model
Efficient and Disciplined Operating Model Gross Margin Sales and Marketing 73% 73% 74% 74% 73% 14% 13% 12% 11% 11% FY18 FY19 FY20 Q1-21 Q2-21 FY18 FY19 FY20 Q1-21 Q2-21 Research and Development General and Administrative 18% 17% 16% 16% 16% 11% 11% 11% 10% 10% FY18 FY19 FY20 Q1-21 Q2-21 FY18 FY19 FY
Slide 17: Capital Structure – July 31, 2020
Capital Structure – July 31, 2020 • Common shares • 84.5 million – Outstanding • 84.3 million – Basic (weighted average) • 85.8 million – Fully diluted (weighted average) • Mixed-Shelf filed on July 16, 2020 (up to $1 billion – currently unused) • Cash and cash equivalents • $US 81.9 million • Acqui
Slide 18: Baseline Calibration
Baseline Calibration Figures per Quarter Baseline Actual Actual % of Baseline Baseline revenues = visible, contracted and Q3’20 Revenue $78.2 $83.0 106% recurring revenues at the beginning of Net Income $9.7 Net Income as a % of Revenues 11.7% each quarter. Baseline revenues is not a Adj. EBITDA $
Slide 19: Investment Highlights
Investment Highlights World’s Largest Multi-Modal and Neutral Logistics Network Cloud-Based Software Applications and Data Content Automating and Optimizing the Increasingly Complex Logistics Market Strong Market Position with Significant Competitive Barriers Disciplined M&A Strategy Highly-Experien
Slide 20: Reconciliation of Non-GAAP Financial Measures - Adjusted EBITDA – Q2-21
Reconciliation of Non-GAAP Financial Measures - Adjusted EBITDA and Adjusted EBITDA as a percentage of revenues – Q2-21 We prepare and release quarterly unaudited and annual audited financial statements prepared in The table below reconciles Adjusted EBITDA and Adjusted EBITDA as a percentage of rev
Slide 21: Reconciliation of Non-GAAP Financial Measures - Adjusted EBITDA – FY20
Reconciliation of Non-GAAP Financial Measures - Adjusted EBITDA and Adjusted EBITDA as a percentage of revenues – FY20 We prepare and release quarterly unaudited and annual audited financial statements prepared in The table below reconciles Adjusted EBITDA and Adjusted EBITDA as a percentage of reve
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