Slide 1: 2012 Half Year Results Presentation
For personal use only 2012 Half Year Results Presentation 21 May 2012 ‐ (ASX:TNE) Please find attached the TechnologyOne 2012 Half Year Results presentation. We draw your attention to slides 45‐46, which provides more detail on full year guidance. Yours faithfully, Rodney Hooper Company Secretary Ab
Slide 2: Half Year Presentation
For personal use only ____ __ ____ _____ Technology One Ltd____ ______ Half Year Presentation _____ _____ 21____ _____ May 2012 - Technology One Ltd (ASX:TNE) today conducted investor _____ presentations _____ pertaining to its 2012 Half Year results. The attached ____ presentation was given at this
Slide 3: 2012 Half Year Results Presentation
For personal use only 2012 Half Year Results Presentation Ending March 31st 2012 Adrian Di Marco Adrian_Dimarco@TechnologyOneCorp.com Final Commercial in conf idence May 2012
Slide 4: TechnologyOne Overview
For personal use only TechnologyOne Overview TechnologyOne develops, markets, sells, implements and supports ____ __ ____ a new _____ generation____ enterprise solution ______ specifically _____ _____targeted at seven vertical markets: • Local Government ____ _____ • Government (State, Central & Fed
Slide 5: TechnologyOne Overview: Products
TechnologyOne Overview Our enterprise solution consists of the following For personal use only products: ____ __ Financials TechnologyOne ____ _____ ____ ______ TechnologyOne Asset Management _____ _____ TechnologyOne Supply Chain ____ _____ TechnologyOne Human Resource & Payroll TechnologyO
Slide 6: TechnologyOne Overview
For personal use only TechnologyOne Overview Offices in Australia, New Zealand, ____ Asia and,__more____ recently,_____ the United____ ______ Kingdom _____ _____ ____ business Growing _____in the United Kingdom _____ _____ Major ____ supplier _____ of enterprise applications in ANZ – 800+ majo
Slide 7: TechnologyOne Overview: Power of One
For personal use only TechnologyOne Overview Unique Business Model - ‘Power of One’ ____ One__ ____ Vision. _____ One Vendor. ____ ______ One Experience. _____ _____ Sell ‘best practice’ preconfigured solutions for ____ our seven_____ vertical markets to reduce time, cost & risk_____ _____ for
Slide 8: TechnologyOne Overview
For personal use only TechnologyOne Overview One of Australia’s ____ __ ____largest_____ software ____ houses, ______ specialising in the research, development _____ and _____ of software – invest commercialisation $32+m ____in _____ R&D per year Connected Intelligence (Ci) is our current _____
Slide 9: Historical Performance
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) Continually ____ paid dividends since 1996 (16 years) Revenue _____ Cash and ___
Slide 10: Historical Performance
Historical Performance Key metrics over last 15 years … For personal use only Revenue ____ -__22%____ per annum_____ compound____ ______ Even through _____ _____ the Dot-Com and GFC Initial ____ Licence Fees - 22% per annum compound _____ Annual _____ Licence Fees - 27% per annum compound __
Slide 11: Agenda
For personal use only Agenda Results ____ __ ____ Significant _____ ____ ______ Achievements _____ _____ Outlook for Full Year ____ _____ Long Term Outlook _____ _____ ____ _____
Slide 12: Results Highlights
Results Highlights FY12 FY11 Variance % For personal use only Revenue $77.3m $71.6m 8% Initial Licence Fees $18.4m $15.6m 18% ____ __ ____ _____ ____ ______ Consulting Services Fees $21.3m $19.6m 9% _____ _____Annual Licence Fees $25.4m $21.8m 16% Expenses $68.0m $62.5m 9% ____ _____ R&D Expenses *
Slide 13: Guidance
For personal use only Guidance Guidance at Annual General Meeting ____ __ ____ _____ ____ ______ Half Year _____ _____ - challenging and not a good indicator of full year results Market consensus was profit to be down between 5% and 10% ____ _____ Actual profit up 2% Half 1 FY11 Abnormally hig
Slide 14: Results Highlights
Results Highlights Strong result given economic climate and the abnormally high previous half year For personal use only Continued__ ____ strong demand for ____ our products: _____ ____ ______ 18% increase in Initial Licence fees _____ _____ 16% increase in Annual Licence Fees ____ _____ Con
Slide 15: Balance Sheet
Balance Sheet Mar-12 Mar-11 Var % Strong balance sheet #039;000 #039;000 #039;000 For personal use only Cash & Cash Equivalents $33.4m (vs $33.4m) Cash & Available-for-sale financial • Net Cash*: 8.51c/s (vs 8.23c/s) assets 33,410 33,396 14 0% • ____ __ ____ 13.27% Debt/Equity: _____ ____ (vs 13.13% ) ____
Slide 16: Cash Flow
Cash Flow Operating Cash Flow $4.4m, down 41% from $7.5m Mar11 Var % Mar-12 Mar-11 For personal use only * Increase in Debtors ($5.2m) as a result of a number of large $ '000 $ '000 #039;000 deals signed late H1 EBIT 8,887 8,624 263 3% ____ __ ____ _____ ____ ______ * Operating Cash Flow $4.4m (vs NPAT
Slide 17: Dividend
Dividend H1 Dividend up 10% For personal use only 1.80 Dividends for this year 1.60 1.40 22% per annum ____ Half 1 __ ____ _____ 1.61 cps up ____ ______ 10%* (declared) Cents per share 1.20 1.00 _____ Payout ratio _____ 0.80 of 67% 0.60 0.40 ____ _____ 0.20 0.00 *Indicative of the confidence for
Slide 18: 2012 Half Results
2012 Half 1 Results Half Year 2012 v Half Year 2011 2012 2011 Variance % 90 Revenue For personal use only #039;000 #039;000 #039;000 80 70 #039;m ____ __ ____ _____ ____ ______ Revenue excl interest 76,863 71,093 5,770 8% 60 50 Expenses (excl R&D, Depn, Forex & 40 _____ _____ Amortisation) 48,520 45,008 3,513 8
Slide 19: 2012 Half Results
2012 Half 1 Results 2012 2011 Variance Dividend (cps) Half Year 2012 v Half Year 2011 % 2.00 #039;000 #039;000 #039;000 For personal use only 1.50 Cents per share EPS cents Reported ____ __ ____ _____ ____ ______ 2.44 2.43 0.01 0% 1.00 DPS cents - standard 1.61 1.46 0.15 10% _____ _____ Dividend Payout Ratio
Slide 20: Ten Year History – Half
10 Year History – Half 1 Average compound growth in Half 1 over the last 10 years For personal use only 30 ____ __ ____ _____ ____ ______ Revenue 14% per annum 25 _____ _____ Licence Fees 16% per annum Consulting 13% per annum 20 ____ _____ Annual support 17% per annum #039;m 15 _____ _____ N
Slide 21: Revenue Streams
Revenue Streams 30.0 $25.4m Up 16% For personal use only 25.0 $21.3m $18.4m Up 9% ____ __ ____ _____ ____ ______ 20.0 Up 18% #039;m 15.0 _____ _____ 10.0 $8.5m Down 16%,$1.6m FY10 FY11 FY12 ____ _____ 5.0 $3.7m Down 18%,$1.2m _____ _____ 0.0 Initial licence fees Annual licence fees Consulting services
Slide 22: Revenue Streams
Revenue Streams Licence Fees up 18%, ASM 20 30 up 16%, For personal use only 18 $2.8m $3.6m 16 25 14 ____ __ Compound ____ Growth 16% _____ ____ ______ 20 12 Compound Growth 17% _____ _____ #039;m #039;m 10 15 8 6 ____ _____ 10 4 2 _____ _____ 5 - ____ _____ 2003 2004 2005 2006 2007 2008 2009 2010 2011 20
Slide 23: Major New Customers
Major New Customers Catholic Education For personal use only South Burnett Regional Council QSuper National Bank of Vanuatu ____ __ ____ _____ ____ ______ Indigenous Business Australia Australian Power and Gas _____ Collection House_____ Ability Options SGE Credit Union ____ Civil _____ Aviation Saf
Slide 24: Revenue Streams
Revenue Streams Consulting up 9%, Plus For personal use only 25 12 down 16%, $1.7m $1.6m 20 10 ____ 15 __ ____ _____ ____ ______ Compound Growth 13% Compound Growth 9% 8 _____ _____ #039;m #039;m 6 10 4 5____ _____ 2 -_____ _____ 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 - 2003 2004 2005 2006 2007
Slide 25: Licence Fee by Product
Licence Fee by Product 6.0 $5m Up 30% $4.7m Up 9% $4.3m 5.0 For personal use only Down 3% 4.0 ____ __ ____ _____ ____ ______ #039;m 3.0 FY10 $1.8m Up 100%+ 2.0 $1.1m 1.0 _____ _____ Up 100%+ $320k $192k $706k Down 16% $278k Down 58% FY11 FY12 Up 100%+ Up 100%+ 0.0____ _____ Financials & CPM Asset HR/Pa
Slide 26: Product - Licence Fee Analysis
For personal use only Product - Licence Fee Analysis Good pipeline of opportunities continue into the second half ____ __ ____ _____ ____ ______ ECM and_____ _____ Property will improve over the full year ____ _____ _____ _____ ____ _____
Slide 27: Licence Fee Contribution - Vertical Market
For personal use only Licence Fee Contribution - Vertical Market Licence Fee Contribution - Vertical Market Managed Services, Utilities, $1.4m, 7% ____ __ ____ _____ ____ ______ $596k, 3% Education _____ _____ Education, $5.6m, 31% Financial Services Government ____ _____ Local Government, $4.5m, 24
Slide 28: Segment Analysis
Segment Analysis Profit Contribution For personal use only $2.6m, Down 13%, $404k 3.5 Heads 229, Up 9% ____ __ ____ _____ ____ ______ 3.0 2.5 $2.1m, Up 100%+ $1m, Down 52%, $1m $1.9m, Down 13%, $291k Heads 274, Up 2% $1.7m, Up 14% Heads 132, Up 10% Heads 82, Down 23% Heads 102, Up 19% _____ _____ 2.
Slide 29: Segment Analysis
For personal use only Segment Analysis New Operating Officer for Consulting appointed ____ __ ____ _____ ____ ______ We expect all segments except Plus to perform well over the full year _____ _____ Reviewing ____ _____Plus structure given the current economic climate Strategy to_____ _____
Slide 30: Agenda
For personal use only Agenda Results ____ __ ____ Significant _____ ____ ______ Achievements _____ _____ Outlook for Full Year ____ _____ Long Term Outlook _____ _____ ____ _____
Slide 31: Significant Achievements
For personal use only Significant Achievements Significant Achievements ____ __ ____ _____ ____ ______ R&D _____ _____ TechnologyOne ____ _____ Cloud United Kingdom _____ _____ ____ _____ Other Initiatives
Slide 32: R&D
R&D R&D Expense Growth up 11% 18 21% of Revenue For personal use only 16 14 Compound Growth 15% ____ __ ____ _____ ____ ______ 12 Target for full year is R&D growth of only 4% pcp 10 #039;m _____ _____ 8 6 ____ _____ 4 2 _____ _____ - 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 ____ _____ R&D up
Slide 33: New Offshore R&D Centre
For personal use only New Offshore R&D Centre New offshore R&D centre in Indonesia to handle future growth ____ __ ____ _____ ____ ______ To contain costs – operating leverage of offshore R&D staff _____ _____ To tap into a new pool of R&D talent outside of Australia ____ _____ To improve supp
Slide 34: TechnologyOne Ci²
TechnologyOne Ci² Ci² is the next generation of our Ci enterprise suite... For personal use only Embrace new technologies, innovations & concepts ____ __ ____ _____ Focus is Simplicity, Not Complexity ____ ______ _____ Browser_____ based – no more software installs & pervasive ____ _____ App
Slide 35: Significant Achievements
For personal use only Significant Achievements Significant Achievements ____ __ ____ _____ ____ ______ R&D _____ _____ TechnologyOne ____ _____ Cloud United Kingdom _____ _____ ____ _____ Other Initiatives
Slide 36: 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 37: The Future – The Cloud
The Future – The Cloud For personal use only Off Premise ____ __ ____ _____ ____Service ______Provider _____ _____ client ____ _____ Internet connection _____ _____ ____ _____ A simpler computing model
Slide 38: 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 39: TechnologyOne Cloud
TechnologyOne Cloud For personal use only TechnologyOne takes care of everything for a Yearly Subscription Fee… ____ __ ____ _____ ____ ______ Hardware, Operating Software, Middleware etc.. _____ _____ Backup ____ Services _____ Replication _____ _____ Services & Disaster Recovery ____ _____
Slide 40: Cloud
Cloud For personal use only ____ __ ____ _____ ____ ______ _____ _____ ____ _____ _____ _____ ____ _____
Slide 41: Significant Achievements
For personal use only Significant Achievements Significant Achievements ____ __ ____ _____ ____ ______ R&D _____ _____ TechnologyOne ____ _____ Cloud United Kingdom _____ _____ ____ _____ Other Initiatives
Slide 42: United Kingdom
United Kingdom United Kingdom licence fees $147k – substantial For personal use only improvement pcp ____ __ ____ _____ ____ ______ UK loss of $789k ($86k improvement on pcp) _____ _____ New customer (Dickinson Dees) ____ _____ Significant impact caused by the GFC Substantially _____ _____ l
Slide 43: Significant Achievements
For personal use only Significant Achievements Significant Achievements ____ __ ____ _____ ____ ______ R&D _____ _____ TechnologyOne ____ _____ Cloud United Kingdom _____ _____ ____ _____ Other Initiatives
Slide 44: Other Initiatives
Other Initiatives Other Initiatives For personal use only TechnologyOne ____ __ ____ Solutions _____ ____ ______ • 14 pre-configured solutions now available _____ _____ • Driving strong growth of our licence fees ____ _____ Compelling Customer Experience _____ _____ • CCE Stage 2 in progress ____
Slide 45: Agenda
For personal use only Agenda Results ____ __ ____ Significant _____ ____ ______ Achievements _____ _____ Outlook for Full Year ____ _____ Long Term Outlook _____ _____ ____ _____
Slide 46: Outlook for Full Year
For personal use only Outlook for Full Year Economic environment remains challenging and uncertain ____ __ ____ _____ ____ ______ TechnologyOne enterprise business remains strong and resilient _____ _____ Continuing growth in Licence Fees in enterprise business ____ _____ • Good pipeline of op
Slide 47: Outlook for Full Year
Outlook for Full Year Assumptions For personal use only Economic climate does not deteriorate any further ____ __ ____ _____ ____ ______ Continuing contract momentum is maintained _____ _____ Total expense growth of 7% in 2012 year ____ _____ R&D expense _____ _____ growth to be 4% • Technol
Slide 48: Agenda
For personal use only Agenda Results ____ __ ____ Significant _____ ____ ______ Achievements _____ _____ Outlook for Full Year ____ _____ Long Term Outlook _____ _____ ____ _____
Slide 49: 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 50: New Products Contribution to Profit
New Products Contribution to Profit New Products Increase Profits For personal use only Profit Contribution - Product - FY11 • Opportunity ____ __ to substantially ____ grow the _____ ____ ______ ECM, CRM, Asset Management contribution to profit by these Property HR/Payroll, Mobile 3% 1% <1% _____ p
Slide 51: Control of R&D Costs
For personal use only Control of R&D Costs Control of R&D costs … ____ __ ____ _____ ____ ______ _____ _____ ____ _____ Com pound Growth 16% _____ _____ ____ _____ leveraging Offshore R&D to achieve substantial savings
Slide 52: 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 $20m in one year • Saving $52m over 5 years ____
Slide 53: 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 54: 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 55: 2012 Half Year Results Presentation
For personal use only 2012 Half Year Results Presentation Ending March 31st 2012 Adrian Di Marco Adrian_Dimarco@TechnologyOneCorp.com Final Commercial in conf idence May 2012