Slide 1: 2020 Half Year Results Investor Presentation
2020 Half Year Results Investor Presentation Half year ended 31st December 2019 13th February 2020 Presented by: Dr. Andrew Blattman Managing Director / CEO, IPH Limited John Wadley Chief Financial Officer, IPH Limited www.iphltd.com.au 1
Slide 2: Disclaimer
Disclaimer This document has been prepared by IPH Limited (IPH) and comprises written No representation, warranty or assurance (express or implied) is given or materials/slides for a presentation concerning IPH. made by IPH that the forward looking statements contained in this presentation are accur
Slide 3: Table of contents
Table of contents 01 HY20 highlights 02 HY20 results 03 Market overview 04 Operations review 05 FY20 strategic priorities 06 Appendix 2020 Half Year Results Investor Presentation | www.iphltd.com.au 3
Slide 4: About IPH Limited
About IPH Limited Asia-Pacific’s leading IP professional services group 1. Approximate employee numbers across the Group. 2. IPH Management estimate based on IP office filing information: Australia (IP Australia) – 1H FY20 as at 30/01/20, Singapore (IPOS) – CY19 as at approx. 29/01/20, New Zealand (
Slide 5: Half year 2020 highlights
Half year 2020 highlights 01 5
Slide 6: Operational highlights
Operational highlights Expanded business continues to deliver value and drive growth Highlights – HY20 Enhanced performance of Xenith IP businesses as part of the IPH group Double-digit organic growth in Asia business continues to drive revenue growth Successful completion of first 100 days of Xenit
Slide 7: Financial highlights
Financial highlights Growth across all financial metrics with application of new AASB16 accounting standards for HY20 Revenue 44% Interim Dividend1 13% $179.8m 13.5 cents per share (fully franked) Xenith contribution4 (since 15 August 2019) EBITDA 41% Underlying EBITDA2 49% $48.8m 8% $57.4m $60.4m R
Slide 8: Financial highlights – pre-AASB16
Financial highlights – pre-AASB16 Compares performance had the prior year accounting standard still applied Revenue 44% Interim Dividend1 13% $179.8m 13.5 cents per share (fully franked) Xenith contribution4 (since 15 August 2019) EBITDA 28% Underlying EBITDA2 36% $48.8m 8% $52m $54.9m Revenue $9.5m
Slide 9: HY20 Results
HY20 Results 02 9
Slide 10: Like for Like Revenue and EBITDA
Like for Like Revenue and EBITDA Consolidated business helps drive double-digit growth in Asia (pre-AASB16) Underlying Adjusted Underlying New Accounting FX Currency Revenue1 Revenue Revenue Chg% Businesses2 Movements3 Adjustment4 Dec 19 Dec 19 Dec 18 Australia & NZ IP 133.8 (43.6) 0.6 (2.6) 88.2 84
Slide 11: Underlying NPAT and EPS
Underlying NPAT and EPS Underlying EPS growth of 23% Underlying Half year ended HY20 Statutory Underlying AASB 16 HY19 Statutory Underlying Adjustments Earnings HY20 Adjustments 31 December 2019 Income Statement Earnings HY202 Adjustments3 Income Statement Earnings HY19 Pre-AASB16 Total revenue 179.
Slide 12: Cash flow statement
Cash flow statement Strong cash conversion Commentary Half Year ended 31 Dec 2019 #039;m HY20 Cash Flow Statement HY19 Cash Flow Statement • Continued strong cash conversion Statutory EBITDA 57.4 40.6 Non-cash movements (0.1) • Strong cashflows support Change in working capital (1.0) (2.1) dividend pay
Slide 13: Balance sheet
Balance sheet Robust balance sheet #039;m Balance Sheet as at 31 Dec 2019 Balance Sheet as at 30 Jun 2019 Cash and cash equivalents 43.7 35.3 Commentary Trade and other receivables 82.9 63.4 Investments - 39.2 • Balance sheet movements reflect the acquisition of Xenith IP and Other current assets 17.4
Slide 14: Impact of foreign currency
Impact of foreign currency Earnings currency Balance sheet IPH currency profile SGD sensitivity sensitivity 17% • Based on the USD profile in HY20 in the • The Group is also exposed to FX on IPH Group, a 1c movement in the the level of its USD denominated Operating AUD NZD 63% 16% AUD/USD exchange r
Slide 15: Revenue and EBITDA
Revenue and EBITDA Organic and acquisitive growth Underlying Revenue $’m Underlying EBITDA $’m Australia and New Zealand IP Australia and New Zealand IP Adjacent businesses Adjacent businesses Asia IP Asia IP New businesses New businesses Corp & interco Corp & interco 1. Underlying EBITDA in HY20 is
Slide 16: Market overview
Market overview 03 16
Slide 17: Global filings – patent and trade mark
Global filings – patent and trade mark Filings through IPH entities or through external agents in all markets1 Australian patent market (FY19) Singapore patent market (CY19) New Zealand patent market (FY19) Patents – IPH Trade marks – IPH 1. Total patent / trade mark cases filed or instructed to be
Slide 18: Patent market – Australia
Patent market – Australia Group consolidates #1 patent market share 1 3 Australian patent filings - market IPH Group market share • The Australian patent market has declined by 1.2% from 1H19 to 1H20 • The acquisition of the Xenith Group consolidates the IPH Group’s no.1 position with a market share
Slide 19: Patent market – Singapore
Patent market – Singapore Maintaining healthy market share in growing market 1 2 Singapore patent filings - market IPH Group market share • In CY19 the Singapore market maintained its recent strength • IPH Group filings were up 1.8% in CY19 over CY18. growing by 5.0%, on top of the 6.8% growth in CY
Slide 20: IPH patent filings – Asia
IPH patent filings – Asia1 Growth engine of the group 30.0% 26.5% • Excellent growth across most other Asian jurisdictions, carrying on from 2H of FY19 • Graphic reflects filings made by an 42.3% IPH entity as the agent in each 27.8% 2.2% jurisdiction (there may be additional 68.0% cases filed with
Slide 21: Trade mark market – Australia
Trade mark market – Australia Leading Australian trade mark group 1 2 Australian trade mark filings - market IPH Group market share • The Australian trade mark market decreased by 1.4% from 1H19 to 1H20 • The IPH Group is the leading Australian trade mark group by market share of the top 50 agents •
Slide 22: Operations review
Operations review 04 22
Slide 23: Xenith IP integration
Xenith IP integration Integration of Xenith businesses into the IPH group proceeding well Successful first 100 days of integration Watermark integration into Griffith Hack Integration plan successfully deployed Integration will strengthen the combined business’ service offering IPH employee incentiv
Slide 24: Xenith IP synergy progress
Xenith IP synergy progress Enhanced performance as part of IPH group On target for previously announced FY19 (4.5 months) synergies for FY20 of $3.4m Revenue $45.1m The increased contribution has been achieved through the following synergies in HY20: Underlying EBITDA $6.3m • Corporate cost synergy
Slide 25: FY20 Strategic Priorities
FY20 Strategic Priorities 05 25
Slide 26: FY20 strategic priorities
FY20 strategic priorities Continued focus on implementing IPH’s growth strategy Strategic priorities for remainder of FY20 01 Continued successful Xenith IP integration 04 WiseTime growth in sales Maintain market leading position in 02 Australia / New Zealand and continued 05 Digital platform develo
Slide 27: Thank you
pel JJ AA a you — a ll Than
Slide 28: Appendix
Appendix 06 28
Slide 29: Strategic direction
Strategic direction Continued focus on IPH’s growth strategy 2020 Half Year Results Investor Presentation | www.iphltd.com.au 29
Slide 30: Patent lifecycle
Patent lifecycle Long-life IP cycle supports consistent revenues and earnings Each year more than half+ of the Typical (indicative) foreign patent application route in Australia total patent applications filed in Australia come through the PCT system in the form of PCT National Phase patent applicat
Slide 31: www.iphltd.com.au
Asia Pacific's leading IP professional services group www.iphltd.com.au 31