Bango plc · LSE:BGO
Bango — H1 FY2012 Earnings Presentation
22 slides from Bango's earnings presentation, Nov 29, 2011
Slide 1: Bango Interim Results for 6 months to 30th September 2011
Bango Interim Results for 6 months to 30th September 2011 29th November 2011 www.bangoinvestor.com - Introduction - Highlights - Opportunity - Progress - Financials - Outlook - Supplementary June 9th 2009 1
Slide 2: About Bango
About Bango Bango customers include: – Founded in 1999 to enable effective collection of payments from mobile device users – Leading global brands choose Bango for mobile payments and analytics – Bango technology, relationships and user data enable a superior user experience, 80+ Operator relationsh
Slide 3: Bango is well positioned for growth
Bango is well positioned for growth • Growing demand for smartphones and associated apps and content • Bango unique IP and partnerships driving uptake by major App Stores • Growth in smartphone app business offsetting decline in featurephone business • Strengthening financial position a solid base f
Slide 4: H1 2012 Operational Highlights
H1 2012 Operational Highlights • Good commercial progress in implementing smartphone strategy: – 17 mobile operators integrated to Blackberry App Store at the period end (1) rising to more than 20 at 29 November 2011 – Integration process underway with over 40 more mobile operators – Second App Stor
Slide 5: H1 2012 Operational Highlights
H1 2012 Operational Highlights • Total revenue £8.66m (£10.61m) • High margin Content Provider revenue increased 13% to £0.92m (£0.81m) • Low margin End User revenue decreased 21% to £7.75m (£9.80m) but increased 1.1% compared to H2 FY2011 (£7.66m) • Adjusted EBITDA* deficit reduced 95% to £0.01m (£
Slide 6: App sales becoming strategic
App sales becoming strategic Android Market Smartphone Users Assorted MNO Portals Assorted Device OEM Marketplace 6
Slide 7: Bango is a powerful partner for App Stores
Bango is a powerful partner for App Stores • Technology to enable Mobile Operator billing (enables greater reach than credit cards) • Automated “back-office” processes (collects money from billers with conversion and tax processing) • Clearing & settlement to developers world-wide (transmits money t
Slide 8: Competitive Landscape
Competitive Landscape • In house development: - slow to deliver (unable to leverage existing connections) - expensive and risky - no cross supplier synergies - no access to special relationships • PC / PSMS Approaches - poor user experience - legacy PSMS problems - do not exploit unique mobile devic
Slide 9: BlackBerry App World
BlackBerry App World A Smartphone Leader: >161 mobile operator partners* >104m installed base* Rolling out App Store for its users 5m free or paid app downloads per day RIM FY Chose Bango for operator billing: Bango is the “Merchant of Record” for all mobile operator transactions for BlackBerry App
Slide 10: End user spending drivers
End user spending drivers: • Mobile Operator Connections - ability to pay on phone bill increases sales - mobile operators more supportive of “on bill” app stores • App Store Activity drives spending – The number of smartphones supporting that App Store – The visibility of the App Store on devices –
Slide 11: Bango Analytics growth
Bango Analytics growth • Current volumes tripled in last year • Significant customers including Turner, Reuters, Yahoo,Telefonica Monthly volume of recorded events • Growth driven by increasing deployment in mobile web sites and in downloaded applications • Android, Apple, BlackBerry, Windows and ot
Slide 12: H1 FY2012: Revenue and Gross Profit
H1 FY2012 : Revenue and Gross Profit 12.0 End User Spend • App store end user spend grew faster than decline in High Margin legacy (featurephone) spend 10.0 • End user spend growth 2.0 returned in May 2011 1.8 8.0 • Margin on end user spend 1.6 improved to 5.3% from 3.0% compared with H2 FY2011 1.4
Slide 13: H1 FY2012: Operating Expenses
H1 FY2012 : Operating Expenses 2.0 • Slight decline due to savings from 1.8 discontinued legacy activity 1.6 • P&L opex expected to remain 1.4 at present levels in second half of FY2012 1.2 GBP (million) • Capitalized £510k for: 1.0 – Future Scalability Project 0.8 – In-App Technology – HTML5 future
Slide 14: H1 FY2012: P&L
H1 FY2012 : P&L £m H1 H2 H1 FY2011 FY2011 FY2012 Revenue End user activity 9.8 7.66 7.75 Other fees 0.81 1.06 0.91 Total revenue 10.61 8.72 8.66 Gross profit End user 0.41 0.23 0.41 Other fees 0.8 1.06 0.91 Total gross profit 1.21 1.29 1.32 Margin % End use activity 4.20% 3.00% 5.30% Other fees 98.6
Slide 15: H1 FY2012: Cashflow
H1 FY2012 : Cashflow • Net cash 30 September 2011 £2.81m 4.0 up from £2.71m at 31 March 2011 and up from £1.16m at 30 September 2010 3.5 3.0 £m Month End Cash Balance • No borrowings during the half year 2.5 2.0 • Growth in transaction volumes is cash 1.5 generative due to cash arriving before it is
Slide 16: FY2012 – Outlook & opportunities
FY2012 – Outlook & opportunities • Now seeing successful momentum of smartphone strategy, with growing overall business as legacy business decline is managed • Positive progress made in cash generation and profitability is a solid foundation for accelerating growth as further App Stores deployed • I
Slide 17: Supplementary Slides
Supplementary Slides 17
Slide 18: Bango: Superior user experience
Bango: Superior user experience Sell App, Bango Content collects or Service to Smartphone payment user User browses Bango collects Confirmation App running In-app “Pay Confirmation site the payment and download on device now” button of payment 18
Slide 19: Superior user experience: Higher sales
Superior user experience: Higher sales User Histories: Accurate Analytics: History / data on 100M+ users Revenues & Refunds, Campaigns,, enables better user experience Insight, Effectiveness Higher Sales Lower Costs Better Information Single technical and commercial integration with 80+ billing syst
Slide 20: Bango: Superior user payment experience
Bango: Superior user payment experience Mobile Payment Example: Warrior needs a sword Pay with Boku Pay with Zong Pay with Bango 1. Choose your sword 1. Choose your sword 1. Choose your sword 2. One click to pay 2. Click & type phone number 2. Click & type phone number 3. Get the sword 3. Click to c
Slide 21: Components of Bango Platform
Components of Bango Platform BILLING COLLECTION OUTPAYMENT Identify / Locate Basics: Basics: - Reporting - Calculation - Reconciliation - Reconciliation BillRank™ - Refunds - Refunds - Chargebacks - Chargebacks Age Verification - Missing items - Fees / fines User RiskHistories: / Fraud - Incentives
Slide 22: Bango Business Model
Bango Business Model 5¢ 100¢ 75¢ Bango net revenue 70¢ approx. 5% 25¢ User Biller Content $1.00 buys $1 cost Provider gross revenue item 25% earns 70% e.g. Notes: e.g. (1) % may vary by biller and CP (2) Taxes excluded for simplicity Month 1 Month 2 Month 3 Month 4 Settlement Transactions Receipts f