Infotrust Ltd · ASX:ITS
Infotrust — Spirit Telecom — H1 2020 Earnings Presentation
18 slides from Infotrust's earnings presentation, Feb 26, 2020
Slide 1: Spirit Telecom Limited (ST1) H1 20 Results & Strategic Outlook
Spirit Telecom Limited (ST1) Financial Year 2020 H1 20 Results & Strategic Outlook Spirit delivers High-Speed Internet and Managed IT Services to support Australian SMB's growth 26 February 2020
Slide 2: Financial Highlights H1 20
Financial Highlights H1 20 A simple focus: Be Australia’s leading provider of IT&T services to Small & Medium Sized Businesses (SMB's) Financial & Commercial summary: • Total Sales Revenue Growth: up 33% to $12.3M on H2 19 and 51% up on H1 19 Total Sales Revenue • Recurring Revenue: up 25% to $10.6M
Slide 3: Total Revenue Growth
Total Revenue Growth $12.3m $12.0m Total Revenue* up at $12.3M: +51% +33% • Total revenue growth up 33% to $12.3M on $10.0m $9.2m previous half and up 51% to H1 19. $8.1m $8.1m $8.2m $8.0m • B2B growth to $9.5m, up 77% on H1 19 achieved through both acquisition and cross selling products. $6.0m • Ma
Slide 4: Underlying EBITDA Growth
Underlying EBITDA Growth $2.00m Underlying EBITDA up at $1.61M: +343% $1.60 m $1.61m • Underlying EBITDA growth up 27% to $1.61M $1.50m on previous half and up 343% to H1 19. $1.4 0 m +27% $1.27m • Revenue growth, margin stability and stringent control of cost base during M&A integration delivering
Slide 5: Total Revenue Mix
Total Revenue Mix 100% B2B and IT/Managed Services focus for continued 10 % 10 % 7% 90% 18% growth: 21% 16% • B2B Mix % uplift to 77% through IT/Managed 80% 21% 25% Services, Data acquisition & organic growth. 70% 25% 24 % • IT/Managed Services bundles and cross sell will 60% further drive growth th
Slide 6: Gross Profit Growth
Gross Profit Growth $10.0m $8.9m Gross Profit up at $8.9M: $8.0m • Gross profit growth up 30% to $8.9M on previous +51% +30% half and up 51% to H1 19. $6.9m $5.9m • Gross profit margin at 72% even with new MSP $6.0m $5.7m $5.4 m product mix flowing though the business. $4.0m $2.0m $0.0m H118 H218 H1
Slide 7: B2B Total Contract Value (TCV)
B2B Total Contract Value (TCV) $9.8m TCV uplift to $7.1m excluding pending $10.0m installations: $2.7m Pending Installation • B2B TCV* for the half up 32% on previous half $8.0m and 83% on H1 19. $7.1m • Total Data & IT services including pending +83% +32% $6.0m installations for H1 20 up to $9.8M (
Slide 8: Operating Cash and Capex
Operating Cash and Capex $10.0m 25% $1.9m Operating Cash at $1.6M, +300% on H1 19. $1.8m Capex* movements across quarters through network 22% 22% $1.6m integration and upgrades: $8.0m 20 % $1.5m • Capex ratio to revenue is 19% for the half reflecting 18% 18% 19% lower capex cost** and revenue growth
Slide 9: Profit and Loss
Profit and Loss $'000s H1 19 H1 20 % Var B2B 4,849 8,017 65% B2C 1,876 1,860 (1%) Legacy / Other 741 681 (8%) • B2B recurring revenue up 65% to $12.5M inclusive of Total Recurring 7,466 10,558 41% Spirit IT&T. Non-Recurring 687 1,740 153% • Non-recurring revenue growth up 153% to $1.74M. Total Sales
Slide 10: ST1 Accelerated Growth Plan 2020-21
ST1 Accelerated Growth Plan 2020-21 A simple focus: Be Australia’s leading provider of IT&T services to Small & Medium Sized Businesses (SMB's) • Current BAU Revenue > $60M • Business units & leadership team established • Spirit X platform provides for unlimited growth in organic sales across 100,00
Slide 11: Expanded Products & Business Model 2020-21
Expanded Products & Business Model 2020-21 New acquired division Spirit X Spirit Internet & IT Trident IT Solutions Revenue FY20 Revenue FY20 $26M $34M • A leading B2B Internet / Telco marketplace and • High-speed Internet & Managed IT Services. • Managed IT Services. aggregator. • Product bundles.
Slide 12: Trident Acquisition Rationale & Update
Trident Acquisition Rationale & Update Spirit Telecom Limited (ST1) has completed its largest and most strategically critical acquisition to date with the purchase of Trident Business Group (TBG) in February 2020: • Trident and Neptune generate combined FY19 revenues of $34M. • Management estimated
Slide 13: Transaction Rationale: Market Size, Scale & Demand
Transaction Rationale: Market Size, Scale & Demand SMB target markets are large and moving through structural IT&T change that require high-speed data, security and cloud applications. No one provider dominates the space providing Spirit with significant category ownership opportunity: • SMB market
Slide 14: Spirit X Update
Spirit X Update The Telecommunications Industry is in need of modernising with Spirit X the digital platform spearheading the advance Digital Simplified National Market Capital mix: More products: marketplace: Many interface and scalability: intelligence: Spirit Allows offering of Lower capex expand
Slide 15: Spirit X update: Growth Stats
Spirit X update: Growth Stats Spirit X platform showing material gains in the 7 weeks since launch Product & Usage: • 5,800 service qualifications (10x increase) have been put through the platform since Dec 19. • Spirit high speed network being sold in platform with additional coverage across circa
Slide 16: Forward Outlook Growth H2 & FY21
Forward Outlook Growth H2 & FY21 Financial & Strategic: scale & grow B2B revenues to $80M by CY20 • Scale via M&A + Organic growth through Spirit X platform to $80M revenue at end of CY 2020. Scale • Continue to scale Spirit to achieve cash flow positive position (after capex) through Q4 FY 20 – Q1
Slide 17: Disclaimer – Important Information
Disclaimer – Important Information ➢ The information in this presentation is an overview and does not contain all information necessary for investment decisions. In making investment decisions in connection with any acquisition of securities, investors should rely on their own examination and consul
Slide 18: Spirit Telecom Limited (ST1)
Spirit Telecom Limited (ST1) Spirit delivers High-Speed Internet and Managed IT Services to support Australian SMB's growth