Slide 1: Investor Presentation
Investor Presentation For the year ended 31 December 2021 To be read in conjunction with Appendix 4E and Accounts
Slide 2: Overview
Overview Reckon Limited (ASX: RKN) is a software-as-a-service (SaaS) company providing cloud-based technology solutions to customers including SMEs, accounting firms and law firms Investment highlights Three defined operating divisions targeting small businesses, accounting and bookkeeping firms and
Slide 3: Corporate overview
Corporate overview Capital Structure Board of directors ASX code: RKN Shares on issue: 113.3m Greg Wilkinson Market capitalisation: FOUNDER & NON-EXECUTIVE CHAIRMAN $113m (as at $1 per share) 52 week high – low: $0.745 - $1.195 Net debt: $15m Phil Hayman NON-EXECUTIVE DIRECTOR Major shareholders Nov
Slide 4: Serving three defined and large sectors
Serving three defined and large sectors SMALL BUSINESS ACCOUNTANTS LEGAL Accounting and Practice Management and Practice Management Payroll solutions for Compliance software for and Workflow for SMEs accounting firms law firms Cloud user base of over 114,000 Enterprise grade software Cost recovery,
Slide 5: Financial Results - 2021
Financial Results - 2021 REVENUE ARR EBITDA NPAT $ 71 $ 65 $ 29 $ 8 million million million million +1.6% over PcP* +2.9% over PcP* +1.4% over PcP* +7.8% over PcP* NET DEBT REDUCED TO FULLY FRANKED DIVIDEND DEVELOPMENT INVESTMENT $ 15 5 cents $ 20 million million * Non-IFRs: Growth has been normalis
Slide 6: 2021 highlights
2021 highlights Transition to a cloud based technology company is Work with Novatti Group to launch integrated now well advanced payments in 2022 well progressed Well established record of a safe, profitable, cash Debt reduced from $30.7m to $14.7m despite ongoing generating, and dividend paying com
Slide 7: Investment in cloud based products
Investment in cloud based products $20m development investment in 2021 led to the launch of 7 new cloud products 7 New Cloud Products released in 2021 Development spend Normalised cash spend on development ($m) Reckon Payroll Reckon Insights Payroll Mobile 20.2 18.8 APS Accountants Scan and PrintQ C
Slide 8: 3 new cloud-based products to launch in 1st Half 2022
3 new cloud-based products to launch in 1st Half 2022 Work and investment in 2021 has laid a New Cloud product Examples strong foundation for new products Reckon Invoicing App APS Ledger+ APS Ledger+ Inquiry Q Reckon Invoicing App RECKON INVESTOR PRESENTATION FY 2021 8
Slide 9: Ongoing cloud user growth
ACCOUNTING AND PAYROLL SOLUTIONS FOR SMES Ongoing cloud user growth Small Business Cloud User Growth USERS 120K 114k 110K 100k Continued growth in cloud revenue 90k 114,000 Cloud users (12% annualised growth) 80k Continued uptake of Reckon Payroll products across cloud and Mobile with over 300,000 7
Slide 10: Cloud development will drive future growth
PRACTICE MANAGEMENT AND COMPLIANCE SOFTWARE FOR ACCOUNTING FIRMS Cloud development will drive future growth Reckon APS seat growth 83k 85k 84k 80k 82k 81k 71k APS Workspaces launched providing complete APS 64k cloud product suite 22 new businesses signed, with 15 in the last 4 months of CY2021, prov
Slide 11: Access to the US legal market
PRACTICE MANAGEMENT AND WORKFLOW FOR LAW FIRMS Access to the US legal market Merger between nQueue and Zebraworks (now nQzebraworks), adds a skilled management team and complimentary cloud products to a well established, US focused legal business Opportunity to introduce cloud practice management su
Slide 12: Continued focus on employee engagement
Continued focus on employee engagement Employee Engagement Stats 97 % 90 % 84 % 81 % Agree we have a good Agree with Employee Would recommend Reckon work culture the strategy engagement to family and friends From Great Place to Work® 2019 Australia From Deloitte; Core Values and Culture From Effecto
Slide 13: Financial Highlights
Financial Highlights RECKON INVESTOR PRESENTATION FY 2021 13
Slide 14: Group financial performance and cash flow
Group financial performance and cash flow FY21 FY20 GROWTH FY21 FY20 $M $M % $M $M Revenue - normalised 71.3 70.2 +1.6% Operating Cashflow (before development) Continuing operations 30.9 30.1 Discontinued operations 0.2 2.3 EBITDA - normalised 29.5 29.1 +1.4% Development Spend Continuing operations
Slide 15: Business Group Financials
ACCOUNTING AND PAYROLL SOLUTIONS FOR SMES Business Group Financials A subscription business with consistently strong online growth Financial performance Revenue FY21 FY20 $M $M GROWTH Revenue • Consistently strong cloud revenue growth CLOUD SUBSCRIPTION 21.4 19.8 8% • Annualised cloud unit growth: 1
Slide 16: Accountant Group Financials
PRACTICE MANAGEMENT AND COMPLIANCE SOFTWARE FOR ACCOUNTING FIRMS Accountant Group Financials Stable subscription revenue and an impressive customer base Financial highlights Revenue FY21 FY20 $M $M GROWTH Revenue SUBSCRIPTION 21.4 21.6 -1% • Subscription is 98% of available software revenue UPFRONT
Slide 17: Legal Group Financials
PRACTICE MANAGEMENT AND WORKFLOW FOR LAW FIRMS Legal Group Financials Stable subscription revenue and a top tier customer base Financial highlights Revenue FY21 FY20 $M $M GROWTH Revenue SUBSCRIPTION 8.3 8.3 +1% • Returned to growth in 2nd half UPFRONT AND SERVICE 1.3 1.5 -13% • New sales continues
Slide 18: Outlook
Outlook RECKON INVESTOR PRESENTATION FY 2021 18
Slide 19: Near term value catalysts
Near term value catalysts SMALL BUSINESS ACOUNTANTS LEGAL Accounting and Practice Management and Practice Management Payroll solutions for Compliance software for and Workflow for SMEs accounting firms law firms Continued cloud growth with APS Workspaces - cloud Solid pipeline of new sales Reckon On
Slide 20: Additional Information
APPENDIX ONE Additional Information FY21 FY20 GROWTH $M $M % Revenue Revenue from continuing operations at constant currency (Non-IFRs) 71.3 70.2 1.6% Discontinued operations 0.8 4.7 Currency impact - 0.7 Reported revenue 72.1 75.6 EBITDA EBITDA from continuing operations at constant currency (Non-I
Slide 21: Resources
Resources Website reckon.com About us reckon.com/au/about-us Investors reckon.com/au/investors Media reckon.com/au/media RECKON INVESTOR PRESENTATION FY 2021 21