Slide 1: 1H18 Results Presentation
For personal use only 1H18 Results Presentation Lee Ellison – Chief Executive Officer Aidan Williams – Co-founder & Chief Technology Officer Rob Goss – Chief Financial Officer 22 February 2018 1
Slide 2: Table of contents
Table of contents For personal use only 1H18 Operational Highlights 1H18 Financial Highlights Growth Strategy & Product Initiatives 2H18 Outlook Appendices: - Financial Tables - Company Overview 2
Slide 3: Audinate is bringing the IT revolution to the AV industry
Audinate is bringing the IT revolution to the AV industry • Dante technology distributes audio signals across computer networks For personal use only • Audinate is the leading supplier of digital audio networking for the Professional AV industry The Dante platform is used in thousands of installatio
Slide 4: Operational Highlights
Delivering strong first half performance, For personal use only on track to meet prospectus forecasts Operational Highlights 4
Slide 5: Operational highlights – 1H18
Operational highlights – 1H18 For personal use only 33% 42% 392 3 OEM 8,000+ growth in OEMs new Dante people product shipments licensed products trained on growth to to 114k* Dante launched Dante 1,292* * PCP (1H17) 5 Westfield Mall Shopping Centre- London, England
Slide 6: Strong growth in revenue and units shipped
Strong growth in revenue and units shipped Revenue (US$M) Dante units shipped For personal use only Chips Modules and Cards $8.0 100% 120,000 113,898 $6.8 95% $7.0 100,123 $6.2 100,000 90% $1.2 $6.0 $0.9 85% $4.9 79,964 $5.0 $4.8 80,000 80% $0.8 $0.8 $3.6 62,575 $4.0 75% 60,000 $0.4 70% 47,646 $3.0
Slide 7: Total Dante-enabled products available
Total Dante-enabled products available Total available products drives economic network effect For personal use only 1,400 1,292 Feb18: 1,367 products 1,182 1,200 Number of Dante-enabled products 973 1,000 874 800 681 600 553 400 348 223 200 0 2H14 1H15 2H15 1H16 2H16 1H17 2H17 1H18 Note: per financ
Slide 8: Financial Highlights
Continued strong revenue growth with For personal use only high gross margins Financial Highlights 8
Slide 9: Financial highlights – 1H18
Financial highlights – 1H18 For personal use only 39% $2.2m $0.1m $0.1m ($0.2m) growth in NPAT up Pro forma operating revenue to from a loss EBITDA ↓ EBITDA cashflow US$6.8m 1H17 from $0.2m ↑ from 1H17 inc $0.9m (PCP) ($16.0m) at 1H17 ($0.4m)* IPO costs *1H17 EBITDA of $0.2m less public company cost
Slide 10: 1H18 Income Statement
1H18 Income Statement (AU$’000s) 1H18 1H17 Change For personal use only • 1H18 NPAT of $2.2m primarily due to favourable impact of Sales 8,848 6,594 34% tax consolidation: $2.4m (refer additional detail in Appendix 1) Cost of goods sold (2,245) (1,648) 36% Gross profit 6,603 4,946 34% • Prior period
Slide 11: Revenue growth outstripping operating costs
Revenue growth outstripping operating costs For personal use only AUD Revenue & Cost trends 10 AUD $M 9 Revenue 8 US CAGR: 29% AU CAGR: 22% 7 6 Costs AU CAGR 16% 5 4 Revenue 3 Employee costs 2 Marketing costs 1 Admin & other opex - 1H16 2H16 1H17 2H17 1H18 AUD #039;000s 1H16 2H16 1H17 2H17 1H18 Revenue
Slide 12: 1H18 Cash-flow Statement
1H18 Cash-flow Statement (AU$’000s) 1H18 1H17 Change • 1H18 payments to suppliers includes $0.9m of IPO For personal use only Cash flows from operating activities costs (with a further $0.1m in financing activities) Receipts from customers 9,304 7,182 30% Payments to suppliers and employees (9,947)
Slide 13: Statutory Balance Sheet
Statutory Balance Sheet (AU$’000s) 31 Dec 17 30 Jun 17 Change For personal use only Cash and cash equivalents 14,4551 18,694 (23%) 1. At the beginning of July the Group received the balance of Trade and other receivables 1,834 2,030 (10%) IPO proceeds ($4.0m) and paid the entire $7.0m owing to Recei
Slide 14: Growth Strategy and Product Initiatives
Growth Strategy and Product Initiatives For personal use only
Slide 15: Growth strategy
Growth strategy For personal use only • Increase market awareness of Dante products Educate end users, system designers and integrators so that they install more Dante products in their AV systems – driving growth in chips/modules sales • Increase penetration of Dante throughout each OEM brand’s pro
Slide 16: New products and innovation
New products and innovation For personal use only Audinate aims to double its addressable market by developing new products and applications 16
Slide 17: Dante Domain Manager
Dante Domain Manager For personal use only Dante Domain Manager (DDM) is network management software that enables user authentication, role-based security and audit capabilities for Dante networks. • Updated firmware delivered to OEMs for release to their customers in 2Q18 • Commercial product launc
Slide 18: Dante AVIO Adaptors
Dante AVIO Adaptors For personal use only Dante AVIO is a cost-effective family of adaptors to connect legacy analogue equipment, USB and AES3 digital audio equipment to Dante networks. • Product design, testing and QA completed in 1H18 • Commercial product launch at National Association of Music Me
Slide 19: Video
Video For personal use only Audinate is developing a video solution to distribute video signals from HDMI connections across a network. • Prototype hardware complete and functional • Software and firmware development on track • On schedule to demonstrate product at InfoComm tradeshow in June 2018 19
Slide 20: FY18 Outlook
For personal use only FY18 Outlook 20
Slide 21: 2H18 Outlook
2H18 Outlook For personal use only • On track to meet FY18 prospectus forecasts • Continue to drive growth in core Dante products • New product initiatives will continue in 2H18 to broaden addressable market – Continued rollout of DDM (although take up of DDM is ultimately determined by ongoing firm
Slide 22: Thank you
For personal use only Thank you 22
Slide 23: Appendix 1: Financial Information
Appendix 1: Financial Information For personal use only 23
Slide 24: Additional detail on 1H18 tax impacts
Additional detail on 1H18 tax impacts For personal use only • On 1 July 2017 Audinate formed a tax consolidated group in Australia which required it to reset the tax cost base of assets through an Allocable Cost Amount (ACA) calculation, which takes into account the primary raise undertaken at the I
Slide 25: 2018 Forecast
2018 Forecast For personal use only A$('000) Forecast • FY18 prospectus forecast was calculated Year Ended 30 June FY18 using an AUD/USD exchange rate of 77c. Sales Revenue 18,552 The sensitivity to changes in exchange rates COGS (4,428) is summarised in the table below (per page 79 Gross Profit 14,
Slide 26: 2018 Forecast
2018 Forecast AUD $’M Employment costs (4.2) For personal use only Marketing spend (0.8) System & processes (0.3) Development capex 2.5 FY18 Pro Forma EBITDA ($1.2m) • New initiatives include DDM, Video & Adaptors – more than doubles the current addressable market • Expenditure relates to FTEs prima
Slide 27: Appendix 2: Company Overview
Appendix 2: Company Overview For personal use only Dante distributes high quality digital audio signals over computer networks 27
Slide 28: Audinate Today
Audinate Today Global ASX listed business, based in Australia For personal use only • Spinout from NICTA (Data61/CSIRO) • Established international customer base • Main office in Sydney, offices in the USA, UK, HK Global leader in audio networking technology • Used by the market leading AV brands (O
Slide 29: Leading the digital transformation of the AV industry
Leading the digital transformation of the AV industry Audinate Customers For personal use only products (OEM Brands) OEM Products Chips Modules Cards Software 29
Slide 30: Audinate: the dominant supplier of digital audio networking technologies
Audinate: the dominant supplier of digital audio networking technologies Dante platform distributes high quality digital audio signals over computer networks For personal use only Selected Analogue signal distribution products Rapid product development Chips Commercially supported, turnkey solution
Slide 31: Competitive landscape
Competitive landscape • There are several competing audio networking solution providers; however, Audinate is the clear For personal use only global market leader • Dante has over five times the adoption of its closest competitor Progression of products supporting audio networking solutions(1) 1000
Slide 32: Audinate's current addressable market
Audinate’s current addressable market Audio networking addressable Audio networking addressable market (A$m)(1) For personal use only market drivers(1) • Collaboration in corporate, government and institutional workplaces 454.6 • Strong pipeline of events and meetings 352.8 • Growth in the live musi
Slide 33: Sound Reinforcement industry overview
Sound Reinforcement industry overview Market size(1) Sound Reinforcement products(1) For personal use only Product % of digital Audio networking for Pro-AV A$352.8m Microphones 36% A$352.8m (Audinate’s directly Sound Reinforcement market(1) addressable market) 5-year CAGR: 2.9% Mixers 15% 10.7 10.0
Slide 34: Increasing customer adoption: Pipeline for growth
Increasing customer adoption: Pipeline for growth Total customers and customers with Dante-enabled products available For personal use only Customers with Dante-enabled products available Total customers 392 346 258 189 192 180 160 144 120 109 93 73 52 1H14 2H14 1H15 2H15 1H16 2H16 1H17 2H17 1H18 No
Slide 35: Selected products: Chips, Modules and Cards
Selected products Chips, Modules and Cards For personal use only Dante Ultimo (Chip) Dante Brooklyn II (Module) Cards Dante Broadway (Chip) Product launched in April 2017 Used in low channel Used in medium to high Peripheral soundcards and applications Used in medium channel channel applications net
Slide 36: Selected products: Software
Selected products Software For personal use only Dante Controller Dante Virtual Dante Via Dante Domain Soundcard Manager Software to enable the Software-only sound card Software that turns audio Product launch expected in configuration and setup of enabling PC and Mac applications and computer secon
Slide 37: Summary
Summary For personal use only Global market leader Significant market opportunity Dominant position as global AV market currently in the early stages leader in audio networking of transformation to digital networking Five times the market adoption of Audinate is perfectly positioned to its closest c
Slide 38: Important notice and disclaimer
Important notice and disclaimer Disclaimer Past performance presentation. The non-IFRS information has not been subject to audit or review by Audinate's For personal use only To the maximum extent permitted by law, none Past performance information, including past external auditor. The non-IFRS meas