Slide 1: INSIDE Secure 2015 Results and Strategy Update
INSIDE Secure 2015 Results and Strategy Update Amedeo D’Angelo, CEO Richard Vacher Detournière, GM & CFO February 25, 2016
Slide 2: Disclaimer
DISCLAIMER This presentation and the information it contains are not intended to constitute, and should not be construed as an offer to sell or a solicitation to buy or subscribe to any INSIDE Secure securities, in any jurisdiction. Any public offering of INSIDE Secure securities would be made by me
Slide 3: Agenda
AGENDA Key Highlights Q4 Revenue and Full Year Financial Overview Strategy Update and Outlook Q&A Appendix 3 |
Slide 4: Agenda
AGENDA Key Highlights Q4 Revenue and Full Year Financial Overview Strategy Update and Outlook Q&A Appendix 4 |
Slide 5: Key Highlights
KEY HIGHLIGHTS FY 2015 • Consolidated revenue of $70.1 million ($15.8 million in Q4 2015) • Adjusted* operating loss of $21.0 million (vs. operating income of $8.1 million in 2014) Strategic decisions on the Group’s business lines 1. Secure Transactions division: Exit1 from the semiconductor busines
Slide 6: Agenda: Q4 Revenue and Full Year Financial Overview
Key Highlights Q4 Revenue and Full Year Financial Overview Strategy Update and Outlook Q&A Appendix 6 |
Slide 7: Q4 and Full Year 2015 Revenue
Q4 AND FULL YEAR 2015 REVENUE Q4-2015 Q4-2014 Q3-2015 % Change % Change in thousands of US$ consolidated consolidated consolidated annual sequential Mobile Security 6 077 12 222 9 805 -50% -38% Secure Transactions 9 706 22 730 9 553 -57% 2% Unallocated - 320 - - 0% Total Revenue 15 783 35 272 19 357
Slide 8: Adjusted Income Statement
ADJUSTED* INCOME STATEMENT 12 months 12 months in thousands of US$ 2015 2014 Revenue 70 106 125 362 Cost of sales (adjusted) (37 264) (50 963) Change essentially explained by Adjusted Gross profit 32 843 74 399 revenue mix (NFC technology and in % of revenue 46,8% 59,3% patent licences in 2014) R&D
Slide 9: Mobile Security – Full Year 2015
MOBILE SECURITY – FULL YEAR 2015 Revenue (in $’00) Adjusted operating income (in $’000) X% = Adjusted operating income as a % of revenue 20% 19 848 11 525 Intel (31%) 625 38 090 26 410 (8 458) 2014 2015 2014 2015 • 2014 Intel licensing agreement and NFC patent licensing program explaining most of th
Slide 10: Secure Transactions – Full Year 2015
SECURE TRANSACTIONS – FULL YEAR 2015 Revenue (in $’000) Adjusted operating income (in $’000) X% = Adjusted operating income as a % of revenue (35%) (5 309) 65 391 (10 678) (8%) 42 422 (25%) 2014 2015 2014 2015 • EMV chip sales in the U.S. market below expectations • Reduction in operating expense no
Slide 11: 2015 Cash Flow
2015 CASH FLOW 40 36.3 Net loss excluding non-cash items In millions of US$ 35 30 (17,3) 25 Change in 20 working capital Capital Equity line Other expenditure (1.8) financing financing Other 16.4 15 (1.1) +0.9 (0.6) (+0.2) 10 5 0 Dec. 31, Dec. 31 2014 2015 11 |
Slide 12: Balance Sheet
BALANCE SHEET Assets In US$ thousands Equity & liabilities As of December 31, 2015 Goodwill 20 873 48 767 Equity PP&E and intangible assets 17 504 Other non-current assets 684 12 361 15 131 Other liabilities Working capital Net cash * 12 476 63 898 63 898 * Definition in Appendix 12 |
Slide 13: Agenda: Strategy Update and Outlook
Key Highlights Q4 Revenue and Full Year Financial Overview Strategy Update and Outlook Q&A Appendix 13 |
Slide 14: 1. Secure Transactions: Exit from the semiconductor business
1. SECURE TRANSACTIONS Exit from the semiconductor business • Exclusive negotiations commenced with a view to selling the semiconductor business1 • In parallel, working with a strategic customer on the transfer under license of a line of semiconductor products developed specifically for this custome
Slide 15: 1. Secure Transactions (Cont'd)
1. SECURE TRANSACTIONS (CONT’D) Launch of a restructuring plan1 in residual semiconductor activities and more broadly the company's organization worldwide • 15% of the global workforce to be impacted • Estimated restructuring cost of around $4m • Generating $4.6m reduction in operating costs per ann
Slide 16: 2. Mobile Security
2. MOBILE SECURITY Completion of repositioning of INSIDE Secure in software security and embedded security technology licensing • Concentrating all efforts on core software and embedded security technologies serving primarily the expanding payment & mobile banking and IoT markets • Leaner cost base
Slide 17: 3. Planned Capital Increase
3. PLANNED CAPITAL INCREASE • Launch of a project of 2 successive capital increases for approximately €7 million • To increase financial flexibility • To support the development of software and technology licensing business and • To better serve customers - Launch in the coming weeks of a € 5 millio
Slide 18: Outlook
OUTLOOK • 2016: a transition year in the context of implementation of major strategic and structuring initiatives • Transformation plan aiming at returning to profitable growth over time 18 | 31/07/15 - H1 2015 Earnings Presentation
Slide 19: Agenda: Q&A
Key Highlights Q4 Revenue and Full Year Financial Overview Strategy Update and Outlook Q&A Appendix 19 |
Slide 20: Agenda: Appendix
Key Highlights Q4 Revenue and Full Year Financial Overview Strategy Update and Outlook Q&A Appendix 20 |
Slide 21: Definitions
DEFINITIONS Adjusted measures Certain financial measures and performance indicators are presented on an adjusted basis. These indicators are not defined under IFRS; they should be considered to be supplementary information, not substitutable for any other indicators of operating and financial perfor
Slide 22: Reconciliation from Adjusted to IFRS (2015)
RECONCILIATION FROM ADJUSTED TO IFRS 2015 2015 Business Sharebased Other non- combination payments recurring costs 2015 IFRS in thousands of US$ Adjusted Revenue 70 106 - - - 70 106 Cost of sales (37 264) (9 557) (1) - (46 822) Gross margin 32 843 (9 557) (1) - 23 284 in % of revenue 46,8% 33,2% R&D
Slide 23: Reconciliation from Adjusted to IFRS (2014)
RECONCILIATION FROM ADJUSTED TO IFRS 2014 2014 Business Sharebased Other non- combination payments recurring costs 2014 IFRS in thousands of US$ Adjusted Revenue 125 362 - - - 125 362 Cost of sales (50 963) (11 932) (43) - (62 938) Gross margin 74 399 (11 932) (43) - 62 424 in % of revenue 59,3% 49,
Slide 24: Investor Information
INVESTOR INFORMATION CONTACTS INSIDE Secure Brunswick INSIDE Secure Corporate Financial communication Investor relations communications Géraldine Saunière Richard Vacher Detournière Jérôme Biscay Marcom Director GM & CFO +33 (0) 1 53 96 83 83 +33 (0) 4 42 39 33 01 contactinvestisseurs@insidesecure.c