Agilysys, Inc. · NASDAQ:AGYS
Agilysys — Investor Presentation (January 2019)
32 slides from Agilysys's investor presentation, Jan 16, 2019
Slide 1: Investor Presentation January 2019
Investor Presentation January 2019
Slide 2: Forward-looking Statements & Non-GAAP Financial Information
Forward-looking Statements & Non-GAAP Financial Information TECHNOLOGY | INNOVATION | SOLUTIONS Forward-Looking Language This presentation contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward- loo
Slide 3: Agilysys Overview
Agilysys Overview TECHNOLOGY | INNOVATION | SOLUTIONS • Agilysys is a Technology Software Solutions Company Subscription Reservations and Exclusively Focused on the Hospitality Industry On Prem Analytics Guest • Our Solutions Are Mission Critical to Core Hospitality Operations Optimization Value - T
Slide 4: We Serve Leading Hospitality Brands
We Serve Leading Hospitality Brands TECHNOLOGY | INNOVATION | SOLUTIONS Gaming – 55% of Revenue Hotels, Resorts and Cruise – 26% of Revenue FoodFood Service – 18% of Revenue Restaurants, Universities, Stadia and Healthcare – 1% of Revenue Note: Revenue contribution figures represent percentage for t
Slide 5: Agilysys Products
Agilysys Products TECHNOLOGY | INNOVATION | SOLUTIONS Well-Established rGuest Emerging POINT OF SALE (POS) PROPERTY MANAGEMENT (PMS) OTHER 5
Slide 6: Go To Market Strategy
Go To Market Strategy TECHNOLOGY | INNOVATION | SOLUTIONS OBSESSIVELY CUSTOMER CENTRIC IN EVERY MARKET WE SERVE ENGINEERING DRIVEN COMPANY ~10%* R&D Team FY19 YTD ~24%* Increase Strength** Improvement in in YTD Jan 2017 – 230 Customer International Dec 2018 – 450 Retention Bookings Dec 2019 – 750 vs
Slide 7: Agilysys Mission
Agilysys Mission TECHNOLOGY | INNOVATION | SOLUTIONS HELP OUR CUSTOMERS IMPROVE GUEST EXPERIENCE AND LOYALTY WHATEVER IT TAKES, INCLUDING INTEGRATION WITH 3rd PARTY PARTNERS WITH DEDICATION TO PAST, PRESENT & FUTURE CUSTOMER INVESTMENTS IN OUR PRODUCTS AND SERVICES 7
Slide 8: What Sets Agilysys Apart
What Sets Agilysys Apart TECHNOLOGY | INNOVATION | SOLUTIONS Pure Hospitality Hospitality is all We Do Because our Business is 100% Focused on this Industry Comprehensive Solutions Agilysys has the Broadest Software Offerings with the Deepest Functionality in the Market Obsessively Customer Centric
Slide 9: Hospitality Market
Hospitality Market TECHNOLOGY | INNOVATION | SOLUTIONS ARR Market Opportunity ARR Product Opportunity $4.8 Billion $4.8 Billion SA $0.35B 7% APAC $1.36B PMS 28% $1.61B NA 34% $1.72B POS 37% $3.18B 66% EMEA $1.36B 28% Agilysys Revenue ~ $131.6M* *Trailing twelve months ended September 30, 2018. 9
Slide 10: Achievements Under New Management Team
Achievements Under New Management Team TECHNOLOGY | INNOVATION | SOLUTIONS January 2017 (Q4 - • Four Consecutive Quarters of Sequential Revenue Growth FY17) we began a focus on cost control • Record Revenue Achieved in Q1 FY19 and Then Q2 FY19 Set Another Record and aligning resources to position •
Slide 11: Creating Value with New Leadership and Strategy
Creating Value with New Leadership and Strategy TECHNOLOGY | INNOVATION | SOLUTIONS 18 Announced 17 First Ever Positive AOE 16 Quarter 15 Heather Foster Ramesh Tony Joins as VP of Marketing 14 Srinivasan Pritchett Joins as Promoted CEO Sridhar to CFO Rod Talbot 13 Laveti Joins as Joins as MD APAC R&
Slide 12: Growth in Engineering Capacity
Growth in Engineering Capacity TECHNOLOGY | INNOVATION | SOLUTIONS 1-Jan-17 31-Dec-18 Growth R&D 229 448 96% Developers 134 302 125% Total Headcount 725 868 20% R&D/HC 32% 52% Developers/HC 18% 35% Contractors 102 19 12
Slide 13: India Development Center
India Development Center TECHNOLOGY | INNOVATION | SOLUTIONS • Currently Doubling Capacity To: • 68,000 Square Feet • 660 Employee Capacity • 319 Out of 338 Current Employees Chennai are Technical Staff 13
Slide 14: Long Term Financial Targets
Long Term Financial Targets TECHNOLOGY | INNOVATION | SOLUTIONS Revenue Possibilities 290 270 Current 250 12/31/17 EV/Rev 230 EV/Rev 2.3 210 1.9 190 170 150 130 FY18 FY19 FY20 FY21 FY22 20% CAGR 15% CAGR 10% CAGR Targeting Four-Year Revenue Growth CAGR of between 10% - 20% and AOE of between 10%-20%
Slide 15: Financial Overview
FINANCIAL OVERVIEW Agilysys.,
Slide 16: Evolving Business, Evolving P&L
Evolving Business, Evolving P&L TECHNOLOGY | INNOVATION | SOLUTIONS Financial Metrics and Valuation (*TTM) Business Metrics (as of 9/30/18) Share Price (1/11/19) $14.32 Direct POS End Points Managed ~51k Diluted Shares Outstanding 23.1M Y/Y Growth 21% Diluted Market Capitalization $330.8M Direct Hot
Slide 17: We Provide Industry Leading Hospitality Solutions
We Provide Industry Leading Hospitality Solutions TECHNOLOGY | INNOVATION | SOLUTIONS PROPERTY POINT-OF-SALE MANAGEMENT 61% of Revenue 27% POS Solutions of Revenue PMS Solutions ~51k end points at 9/30/18 ~270k rooms at 9/30/18 +21% since 9/30/17 9% +8% since 9/30/17 of Revenue DOCUMENT INVENTORY &
Slide 18: Strong Balance Sheet
Strong Balance Sheet TECHNOLOGY | INNOVATION | SOLUTIONS Consolidated Balance Sheet (in thousands) March 31, 2018 September 30, 2018 Cash, Cash Equivalents and Marketable Securities $39,943 $32,904 Other Current Assets 23,981 30,426 Long-Term Assets 93,283 90,296 Total Assets $157,207 $153,626 Curre
Slide 19: Historical Financial Results - Trailing Twelve Months
Historical Financial Results - Trailing Twelve Months TECHNOLOGY | INNOVATION | SOLUTIONS Revenue - GAAP Net Loss - GAAP $135,000 ($1,000) $131,577 $130,000 $127,678 $127,360 Record ($6,000) ($3,765) Revenue $125,000 Quarter ($7,671) $120,366 (Q2’19) ($11,000) ($8,350) $120,000 ($11,721) ($16,000) $
Slide 20: Profitability Metrics - Quarterly Total Revenue
Profitability Metrics - Quarterly TECHNOLOGY | INNOVATION | SOLUTIONS Total Revenue $35,000 $34,203 $33,865 $34,007 $34,000 $33,448 $33,000 $32,676 $32,056 $32,000 $31,310 $30,953 $31,000 $30,602 $30,129 $30,000 $29,000 $28,000 $27,000 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 All
Slide 21: Profitability Metrics - Quarterly Adjusted Earnings from Operations
Profitability Metrics - Quarterly TECHNOLOGY | INNOVATION | SOLUTIONS Adjusted Earnings from Operations – Non GAAP^ $1,995 $2,000 $1,000 $564 $237 $0 ($1,000) ($1,158) Q3-FY18 ($1,440) included ($2,000) ($1,909) $700K of capex for IDC ($3,000) expansion ($3,100) ($3,247) ($3,475) ($4,000) ($3,779) Q
Slide 22: Profitability Metrics - Quarterly Adjusted EBITDA
Profitability Metrics - Quarterly TECHNOLOGY | INNOVATION | SOLUTIONS Adjusted EBITDA – Non GAAP^ $3,500 $3,113 $2,965 $3,061 $3,000 $2,641 $2,500 $2,310 $2,069 $2,000 $1,640 No $1,500 $1,308 Software Capitalization in $1,000 Q2-FY19 $441 $500 $0 ($500) ($234) Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'
Slide 23: Profitability Metrics - Adjusted EBITDA less Capitalized Software
Profitability Metrics - Quarterly TECHNOLOGY | INNOVATION | SOLUTIONS Adjusted EBITDA less Capitalized Software Development Costs – Non GAAP^ $3,000 $2,584 $2,000 $1,415 $981 $1,000 $274 $0 ($177) ($385) ($1,000) No ($1,350) Software ($2,000) ($1,646) Capitalization in Q2-FY19 ($2,429) ($3,000) ($2,
Slide 24: Appendix
APPENDIX
Slide 25: Senior Management Leading New Growth Vision
Senior Management Leading New Growth Vision TECHNOLOGY | INNOVATION | SOLUTIONS RAMESH SRINIVASAN - President and Chief Executive Officer Ramesh is an accomplished CEO with leadership and turnaround success across multiple industries resulting in rapid and sustainable long-term growth and significan
Slide 26: Senior Management Leading New Growth Vision
Senior Management Leading New Growth Vision TECHNOLOGY | INNOVATION | SOLUTIONS KYLE C. BADGER - Senior Vice President, General Counsel and Secretary Kyle leads the global legal and human resources teams, and brings over 22 years of legal experience representing public and private companies in gener
Slide 27: Senior Management Leading New Growth Vision
Senior Management Leading New Growth Vision TECHNOLOGY | INNOVATION | SOLUTIONS ROB JACKS – Chief Information Officer Rob was promoted to CIO in December 2018 and is responsible for advancing Agilysys’ internal systems and information technology processes. Rob has a reputation as a transformational
Slide 28: Non-GAAP Reconciliation
Non-GAAP Reconciliation TECHNOLOGY | INNOVATION | SOLUTIONS AGILYSYS, INC. RECONCILIATION OF NET LOSS TO ADJUSTED EARNINGS FROM OPERATIONS (UNAUDITED) Twelve Months Ended March 31 (In thousands) TTM* 2018 2017 2016 Net loss $ (7,671) $ (8,350) $ (11,721) $ (3,765) Income tax expense (benefit) (3,431
Slide 29: Non-GAAP Reconciliation
Non-GAAP Reconciliation TECHNOLOGY | INNOVATION | SOLUTIONS AGILYSYS, INC. RECONCILIATION OF NET LOSS TO ADJUSTED EARNINGS FROM OPERATIONS (UNAUDITED) Three Months Ended September 30, June 30, March 31, December 31, September 30, June 30, March 31, December 31, September 30, June 30, (In thousands)
Slide 30: Cash Flow
Cash Flow TECHNOLOGY | INNOVATION | SOLUTIONS TTM* FY18 FY17 FY16 Operating activities Loss from continuing operations $ (7,671) $ (8,350) $ (11,721) $ (3,765) Non cash adjustments, restructuring, legal settlements 17,129 16,586 14,110 7,741 Changes in assets & liabilities (3,682) (1,362) 1,044 3,24
Slide 31: Agilysys Corporate Headquarters and Global Footprint
Agilysys Corporate Headquarters Agilysys Global Footprint • Alpharetta, Georgia Agilysys US Offices • Las Vegas, Nevada • Santa Barbara, California • Bellevue, Washington Agilysys EMEA Office Windsor, UK • United Kingdom Seattle, WA Las Vegas, NV Agilysys APAC Offices Santa Barbara, CA Alpharetta, G
Slide 32: Contact
Contact: Tony Pritchett Chief Financial Officer (770) 810-7941 Richard Land / Norberto Aja InvestorRelations@agilysys.com JCIR (212) 835-8500 Dave Wood agys@jcir.com VP of Finance (770) 810-7920 InvestorRelations@agilysys.com 32