Aussie Broadband Ltd. · ASX:ABB
Aussie Broadband — Investor Day (November 2022)
75 slides from Aussie Broadband's investor day presentation, Nov 9, 2022
Slide 1: Investor Day Presentation (ASX Announcement)
ASX Announcement 9 November 2022 Investor Day Presentation Aussie Broadband Limited (ASX:ABB) provides the attached presentation which will be delivered today at the Aussie Broadband inaugural Investor Day. ENDS Authorised for release by the Aussie Broadband Board. Investor enquiries contact Ronn Be
Slide 2: Investor Day
Investor Day 9 November 2022 e/, Aussie = Broadband
Slide 3: Disclaimer
Disclaimer Not an offer The matettal contained in this presentation is for information purposes only and is intended to be general background Information on Aussie Broadband Linited (ABB) and its activities and is ioted 9 November 2022. Its for Information purposes ‘only and is not, and should not b
Slide 4: Traditional Owners acknowledgement
Aussie Broadband acknowledges the Traditional Owners of Country throughout Australia and recognises the continuing connection to lands, waters and communities. We recognise that we work and live on the traditional land, and we pay our respect to the past, present and emerging Traditional Custodians
Slide 5: Before we begin
Before we begin… Welcome to our first For those in person: • Directions to toilets and emergency exits Investor Day! For those online: • In order to respect our partners, we ask that you don’t record this session For everyone: • Please hold questions until the Q&A session at the end of the presentat
Slide 6: Today's agenda
Today's agenda Today provides you with an Welcome and introductions 10:30am opportunity to better understand Transitioning to Aussie 2.0 10:35am Our technology and infrastructure 10:50am Aussie Broadband's growth Residential strategy 11:10am strategy, while also meeting Morning tea 11:30am members o
Slide 7: Our Board
Our Board Adrian Fitzpatrick Richard Dammery Vicky Papachristos Patrick Greene Phillip Britt Michael Omeros Independent Chair & Independent Non-Exec Independent Non-Exec Independent Non- Managing Executive Non-Exec Director Director & Chair of People Director & Chair of Risk & Exec Director Director
Slide 8: Our Management team
Our Management team PHILLIP BRITT MICHAEL OMEROS BRIAN MAHER MATTHEW KUSI-APPAUH JANE BETTS MANAGING DIRECTOR EXECUTIVE DIRECTOR CHIEF FINANCIAL OFFICER CHIEF OPERATING OFFICER CHIEF PEOPLE & REPUTATION OFFICER JONATHAN PROSSER AARON O’KEEFFE KEVIN SALERNO JOHN REISINGER CHIEF STRATEGY OFFICER CHIEF
Slide 9: Our journey so far
Our journey so far * Wideband Networks was founded by Phillip Britt and John Reisinger in the Latrobe Valley in Victoria. * Purpose - to provide high quality wireless + Established direct connections internet to rural and regional areas offen * Wideband Networks merged to local nbn™ points of neglec
Slide 10: Our journey so far
Our journey so far ¢ Completion of the fibre , + Aussie Broadband reached 100K customers. rollout. We started on-selling : : ~ an Optus nbn™ product * We launched our ground-breaking MyAussie app. * Aussie Broadband in areas without a direct + Phillip Britt inducted into Edison Awards Hall teached 4
Slide 11: Aussie Broadband today
Aussie Broadband today 800,000+ ~530,000 ~1,100 Certified active services: unique customers: staff in 8 locations: Australia’s Most • Broadband • Residential • Morwell Trusted Telco • Voice • Business • Dandenong • Mobile • Enterprise & • Sydney • Cloud Government • Melbourne • Entertainment • Whole
Slide 12: Awards reflect ABB's focus on product innovation and customer service
Awards reflect ABB’s focus on product innovation and customer service * PREMIUM BRAND "Aussie Broadband: ROY MORGAN. 202: 7 VT fine fine finder. J CHO CHOICE cOMMgER PRODUCT (@) REVIEW .COM.AU Pee WINNER INTERNET SERVICE PROVIDERS o-STAR {Wal EMPLOYER , of OF CHOICE WINNER 11
Slide 13: What our customers say
What our customers say "Great customer service. Great service provider. Always get the help you need" Warmungah, Product review "Absolutely awesome customer service, friendly and very efficient and cost effective. Very impressed" Pene Harris, Facebook review "Very happy with the service, friendly an
Slide 14: Over the Wire acquisition
Over the Wire acquisition Over the Wire at a glance Integration update • Business-focused technology company with a • Accelerated integration of OTW, allowing a full product set across data, voice, cloud, one team approach to delivering both cost security and managed services efficiencies and revenu
Slide 15: ABB + OTW = Aussie 2.0
ABB + OTW = Aussie 2.0 We are transforming our organisation • Huge opportunity for ABB to be even bigger to reach our full potential. than where we are today, and deliver more value. We are Aussie 2.0. • Through extensive consultation across the organisation we have co-created and are now bringing t
Slide 16: We're in business to: Change the Game
We’re in business to: Change the Game Put simply, we are changing the telco and tech game in Australia for the better. And not just for our customers, but for all. We’re also interested in other games worth playing, like how we can be a place to belong, how we can make our communities better, how we
Slide 17: Our Values
Our Values Don’t be ordinary, be awesome Think BIG No bullsh*t Be good to people Have fun a BR Ww NO
Slide 18: By 2025, we are Australia's 4th largest provider
By 2025, we are Australia’s 4th largest provider of communications and technology services 17
Slide 19: FY25 aspirations
FY25 aspirations Thriving and talented people * One of the best places to work in Australia * Staff say this is a place they belong Delivering sustainable growth * >1 million broadband services * >250,000 mobile services * >3 million numbers on the voice network ¢ Accelerating growth of cloud servic
Slide 20: Our Game
Coe Bilan : roadban Our Game By 2025, we are Australia’s 4th largest provider of communications & technology services. Continuing to Making getting show Australians & staying Providing a Leveraging our what a good connected as genuine, full- infrastructure and telco looks like. easy at work as servi
Slide 21: FY23 strategic focus
FY23 strategic focus • Bed down the new Aussie 2.0 operating model, team structure and strategy • Deliver further cost synergies from the OTW acquisition and unlocking the full revenue synergy potential of both companies • Continue to invest in our data, voice and cloud infrastructure to underpin ou
Slide 22: Our Technology and Infrastructure
Our Technology and Infrastructure John Reisinger - Chief Technology Officer Phillip Britt - Managing Director
Slide 23: Our technology strategy
Our technology strategy We are now one of Australia’s largest infrastructure operators across data, voice and cloud. Our deep technical expertise is the foundation of our exceptional customer experience and continued growth. 22
Slide 24: Smarter network management
Smarter network management CVC is highly leveraged and does • Aussie is committed to providing the right amount of bandwidth to deliver an awesome customer not incentivise providers to focus on experience – customers can do what they want, when they want customer experience. Through our • In-house d
Slide 25: Data network upgrades
Data network upgrades We are strategically upgrading our network: Allowing us to provide even better services: • Moving from 100G to 400G links • Easily able to scale our network to 1 million • Implementing "leaf-spine" architecture for NBN customers (and beyond) network equipment in line with indus
Slide 26: Aussie Fibre network
Aussie Fibre network Over 1,200km of next generation • Full 121 NBN POI coverage (point of interconnect) fibre has been laid in the last 20 • 83 NBN POIs directly connected to Aussie Fibre and the remaining 38 connected via Telstra wavelengths months, creating one of the most modern networks in Aust
Slide 27: Aussie Fibre network reach
Aussie Fibre network reach Melbourne Perth Adelaide 26
Slide 28: Aussie Fibre network reach
Aussie Fibre network reach Sydney Brisbane Canberra 27
Slide 29: Aussie Fibre network synergies
Aussie Fibre network synergies Moving ABB and OTW enterprise • Of the $8m to $11m annualised synergies expect from the OTW acquisition, a portion customers on other carriers to the will come from moving enterprise Aussie Fibre network will unlock connections on other carriers to Aussie Fibre signifi
Slide 30: New fibre customer example
New fibre customer example • Real life example from Sydney – one of the harder ones to build due to footpath reinstatement costs • Stage 1 started with a single customer. Shortly after a second customer next door signed up • Stage 2 buildings will be connected on demand back to the joint already bui
Slide 31: Customer migration example
Customer migration example • Stage 3 continues the network built from Stage 1. This is about to be constructed as part of unlocking the next phase of OTW cost synergies – 3 additional buildings, but 5 services • Stage 4 buildings will be activated on demand as customers sign up. Pre identified build
Slide 32: Tier 1 voice network
Tier 1 voice network • Tier 1 means we are directly connected to each With the acquisition of Over the Wire, of the other major carriers (Telstra, Optus, TPG, Aussie now operates a Tier 1 voice Symbio, Vocus) that are part of the national Carrier Interconnect network network, providing both cost sav
Slide 33: Our voice difference
Our voice difference Features of NetSIP: Benefits for Customers: • Path redundant, carrier diverse national network • 7 domestic carriers, 6 international carriers Better call quality • 5 voice clusters across 3 different states • Best-possible-path routing Improved reliability • Automated testing o
Slide 34: Cloud opportunity
Cloud opportunity • Businesses have been moving away from legacy, on-site platforms largely due to cost and the risks involved • Australian organisations spent $1.36 billion on IaaS in 2020, up 38% from 2019 and this is on track to exceed $3 billion by 2025 • Public cloud providers (Amazon, Microsof
Slide 35: Our cloud infrastructure
Our cloud infrastructure • Telsyte found hybrid cloud use is high (65%) as organisations shuffle a mix of workloads • Going forward, hybrid cloud use and intentions are very high (85%) as CIOs select the most appropriate cloud architecture • Through the OTW transaction we acquired Digital Sense, a d
Slide 36: Customer cloud example
Customer cloud example Aussie = Broadband Self-Hosted Private Cloud (Data Centre) (AWS) (ABB) cpu 4 4 4 4 RAM 16 16 16 16 Storage 1000 1000 1000 1000 vf Lowest cost Pros Cons eo Total control of platform & data ov Low latency X Not easily scalable X Lack of resiliency X Needs niche statt X Ongoing m
Slide 37: Security
Security We remain vigilant for threats that Ongoing activities include: may compromise the security of • Partnership with the Australian Cyber Aussie's infrastructure or customer Security Centre (ACSC) information. • Re-certified as ISO27001 compliant (Information Security Management) • Security pe
Slide 38: Residential
Residential Jonathan Prosser - Chief Strategy Officer
Slide 39: Residential strategy
Residential strategy ABB is a premium player We have two different but complementary product strategies Price led decisioning Value led decisioning to grow share and value in FY23 and Our focus: beyond. • ABB is the ’most premium’ telco provider in Australia, meaning that customers are willing to pa
Slide 40: Residential strategy
Residential strategy Fixed Line growth Mobile launch Evolve current strategy to focus on profitable growth Launch ABB as a mobile contender with credibility and take advantage of NBN’s ongoing investment in driven by bundling and Fixed Line brand. Focus will be High Speed Tiers in areas where the Op
Slide 41: Residential strategy
Residential strategy Focused growth in mobile Does ABB have brand permission? Focusing on the BYO portion of the Postpaid market Independent research conducted found3: with this number growing YoY • Resounding permission for Aussie Broadband to Within this market taking a segment driven view: play i
Slide 42: Residential strategy
Residential strategy Bundling as the enabler 3 principles drive bundling design: Bundling principles Example of Use-Cases • Fixed as hero – in a scenario of a Mobile + Fixed bundle the demonstration of “great value” will be Fixed is our hero and 1. For your crowd: multi- achieved by manipulating Mob
Slide 43: Residential marketing
Residential marketing Principles to enhance our brand We are evolving our Brand and Marketing strategy. Our ‘personality’ will be less about the Aussie Larrikin Be consistent with the brand identity across all touchpoints and more grounded in fuss-free, approachable, helps-out-a-mate, Be highly visi
Slide 44: Residential marketing
Residential marketing Aussie Broadband is genuinely solving a category pain point through CX. This is key to demonstrating our value. Four elements of the customer experience offered by Aussie Broadband serve as a true point of difference in the market4 BE APPROACHABLE UNDERSTAND ME FIND A WAY AUSSI
Slide 45: Fundamentals for growth
Fundamentals for growth Shape of ABB customers vs ROM5 Fixed portfolio shape-of-share (July to Oct ‘22) Continued YoY growth in share of connections, Growth but it is the “shape of this share” that is important Tier 1 ABB • ABB’s skew toward High Speed Tiers drives margin benefits and profitable gro
Slide 46: Fundamentals for growth
Fundamentals for growth Fixed portfolio share of market Top 4 combined NBN market share7 (TLS, TPG, Optus, Vocus) 98% 96% Aussie's growth rate toward the end of FY22 95% 95% 95% 96% 94% 94% 94% 94% 94% 93% 93% 93% 93% 94% shows the strong basis for future growth 92% 91% 90% 89% 90% 88% 88% • Aussie
Slide 47: Stable churn
Fundamentals for growth Stable churn • Hyper competitive market, in particular the Residential high-speed space • New entrants into this space have led to heavy promotional activity, driving down the implied value in the market • Despite this, Aussie has maintained churn rates at historical levels –
Slide 48: Mobile sales
Fundamentals for growth Mobile sales9 Mobile growth 3,000 2,500 • 48% growth YoY with significant trajectory 2,000 post Q3 reflecting our changed approach 1,500 to pricing and proposition design 1,000 500 • New approach enabling ‘net new’ 0 Feb-22 Mar-22 Apr-22 May-22 Jun-22 Jul-22 Aug-22 Sep-22 Oct
Slide 49: FY23 product roadmap
FY23 product roadmap Fixed Mobile Bundles 48
Slide 50: Business
Business Aaron O’Keeffe - Chief Growth Officer
Slide 51: Business opportunity
Business opportunity The market The opportunity • There are currently 2.5 million small to In a market that historically hasn’t been served medium sized businesses (SMBs) in Australia. well by the incumbents lies an opportunity to This number has been increasing since 2019 provide customers with: •
Slide 52: Business strategy
Business strategy Making getting and staying connected as easy at work as it is at home • Target market: SMBs looking for simple, straightforward solutions that let them get on with running their business • Products: wide product set including broadband, business phones, mobile, hardware and securit
Slide 53: Aussie's exponential growth
Aussie's exponential growth Business connections growth • Our business services growth took off 60,000 toward the end of FY20, coinciding with our 53,559 new business product launch, business 50,000 marketing strategy and the launch of our new Melbourne-based business call centre 40,000 35,466 • FY2
Slide 54: Expanded product portfolio
Expanded product portfolio We understand that businesses need more than just the basics, so we are expanding our products and services for these customers B® vf co» (ie NBN Broadband Symmetrical Broadband Business Grade Special Phone Numbers Services up to Services up to Networking & (1300/1800 and
Slide 55: Our business advantage
Our business advantage Making it easy for our business customers to do business
Slide 56: The growth opportunity
The growth opportunity We have the ability to leverage Aussie's existing infrastructure to provide more products to our business customers (at higher margins) • Cloud backup, allowing our customers to backup and restore their data securely • Mobility services that are built to service IoT environmen
Slide 57: Enterprise & Government
Enterprise & Government Aaron O’Keeffe - Chief Growth Officer
Slide 58: Enterprise & Government strategy
Enterprise & Government strategy Providing a genuine, full-service alternative to the Big 4 • Mid to large enterprise and government customers seeking a partner to deliver tailored communication and technology services Target market • Particular focus on multi-site customers where we can fully lever
Slide 59: E&G Product strategy
E&G Product strategy Leverage the combined strengths of Aussie Broadband’s expansive data network with Over the Wire’s tier 1 voice network, enterprise cloud platform and extensive knowledge of enterprise and government customers to win market share in this segment. We have the ability to provide en
Slide 60: One segment, two strategies
One segment, two strategies Enterprise Government Leverage our diverse product offering and strong Leverage our existing relationships, as well as customer focus to deliver solutions and provide panels which allow us to bid for government the right outcome by: telecommunications contracts: • Spendin
Slide 61: Westpac case study
Westpac case study Aussie Broadband supplies over 1,000 services across Australia, including NBN, enterprise-grade fibre and data centre services. Westpac uses Carbon frequently to place new orders and support existing services. 60
Slide 62: Queensland Treasury case study
Queensland Treasury case study About the customer Our solution • Full cloud solution that included a active-active, multi- • Queensland Treasury is responsible for managing site cloud architecture, redundant links into Queensland’s revenue and expenditure in a way that government, core network servi
Slide 63: NEXTDC case study
NEXTDC case study Aussie Broadband has a strong, mutual partnership with NEXTDC. Although in the business of data centres, NEXTDC has a large corporate network (like any enterprise) that is fully supported by Aussie. This allows the staff at NEXTDC to focus on their core business. Aussie also uses N
Slide 64: Wholesale
Wholesale Matthew Kusi-Appauh - Chief Operating Officer
Slide 65: Wholesale strategy
Wholesale strategy Our wholesale strategy leverages • Our infrastructure and technology platforms supporting our direct segments can easily our infrastructure investment to scale to service wholesale customers deliver further value from scale • Currently expanding our product offering on the back of
Slide 66: Carbon | Wholesale data
Carbon | Wholesale data • Carbon is unique in the way it provides end-to-end automation of ordering, configuration and management of complex services Active Carbon services 16000 • Carbon’s features give customers and partners unrivalled speed and lower operating costs 12000 • Tailored to the MSP ma
Slide 67: NetSIP | Wholesale voice
NetSIP | Wholesale voice • Use of our Tier 1 voice network continues to grow strongly, with 127 million minutes in October ‘22 (27% growth YoY and over double since Jan ‘21) NetSIP monthly voice minutes • The market for "Over-the-Top" (OTT) voice services 160 M (Microsoft Teams, Cisco Webex, Zoom, e
Slide 68: Origin white label partnership
Origin white label partnership In 2020, Origin approached Aussie to provide their telco services, on the back of Aussie’s reputation as providing the best customer service in the industry. The partnership continues to grow, with Origin more than doubling their broadband base in the last 12 months to
Slide 69: Delivering stakeholder value
Delivering stakeholder value Brian Maher – Chief Financial Officer
Slide 70: Financial highlights
Financial highlights • We are still growing.... • FY23 guidance reaffirmed at an EBITDA margin of c10 –10.5% on expected revenue of $800m to $840m • Investments in capability and infrastructure to position Aussie for longer term growth • $5.2m of synergies actioned, more expected by end of financial
Slide 71: Investing for growth
Investing for growth • FY22 capex spend dominated by Fibre backbone - $13m tail to be completed in FY23 • Significant investment in longer term growth infrastructure (3 to 5 years) in FY23 including: • IPv4 addresses - $5.1m for 65,000+ addresses • Fibre network hubs - $5.3m $m • Core network infras
Slide 72: Making an impact
Making an impact 1 2 Aussie Broadband is Inclusion & diversity Environmental action committed to making • Dedicated employment pathways • Commitment to 100% for regional and marginalised renewable energy generation for our an authentic, positive communities consumption by 2025 impact in the • Achiev
Slide 73: Wrap Up
Wrap Up Phillip Britt - Managing Director
Slide 74: Changing the Game
Changing the Game Aussie continues to be the fastest • Aussie 2.0 strategy well advanced, and benefits are now being seen from our "one team" approach growing telco in Australia, • Continued strong growth across all segments, in consistently taking market share particular the high-margin business ma
Slide 75: Thank you
Thank you Authorised for release by the Aussie Broadband Board For investor enquiries please contact Ronn Bechler on 0400 009 774 or investors@team.aussiebroadband.com.au For media enquiries please contact Alex Walker on 0448 110 962 For registry queries please contact Link Market Services on 1300 5