Ikegps Group Ltd · NZX:IKE
Ikegps — H1 2025 Earnings Presentation
40 slides from Ikegps's earnings presentation, Nov 27, 2024
Slide 1: IKE 1H FY25 Financial Performance & Update
IKE 1H FY25 Financial Performance & Update We’re IKE, the Pole OS Company Glenn Milnes, CEO and Brian Musfeldt, CFO glenn.milnes@ikegps.com, brian.musfeldt@ikegps.com November 2024 CONFIDENTIAL
Slide 2: Important Notice
Important Notice Information in this Presentation: • Is for general information purposes only, and is not an offer or invitation for subscription, purchase, or recommendation of securities in ikeGPS Group Limited (IKE); • Should be read in conjunction with, and is subject to, IKE’s FY24 financial re
Slide 3: Agenda
Agenda 1H Financial Performance Headlines October 2024 performance update Outlook Addressable market and IKE’s value proposition Q&A ikeGPS 3
Slide 4: 1H FY25 performance highlights
An exit run rate of ~NZ$13.2m annualized subscription revenue (+34% vs pcp). Gross margin improves to ~NZ$8.1m (+31% vs pcp), with a Gross Margin percentage of ~67%. Record ~NZ$33m in contracts won in the period, across ~415 deals. 1H FY25 performance highlights: • Exit run rate of annual platform s
Slide 5: Subscription revenue growth has continued to be consistently strong
Subscription revenue growth has continued to be consistently strong with a three-year CAGR of 38% In 1H, a total of ~$33M of contracts closed Takeaways: • Significant growth in underlying subscription revenue. • Three-year subscription revenue CAGR of +38%. • During FY25, this is expected to increas
Slide 6: Exit Run Rate of annual platform subscription has grown to NZ$13.2m
Exit Run Rate (ERR) of annual platform subscription has grown to NZ$13.2m as at 30 September 2024 Takeaways: • +34% YoY growth in the exit run rate (ERR) of annual platform subscription revenue. • As stated, during the FY25 period this metric is expected to continue to grow materially (by ~40% vs pc
Slide 7: 179% YoY increase in subscription seat licenses
179% YoY increase in subscription seat licenses, evidencing the impact of new product introductions with very sticky customers Takeaways: • Subscription seat license growth of +179% over the past year. • Seat count growth has accelerated at a fast pace due to customer additions and upsells, as well
Slide 8: Three-year transaction revenue CAGR of 20%, and improved margin profile
Three-year transaction revenue CAGR of 20%, and improved margin profile Takeaways: • Three-year transaction revenue CAGR of +20%. • Noting gross margin increased +107% vs pcp. • Based on contracts signed in Q2 FY25, IKE expects transaction volumes and associated revenue to continue to build into 2H
Slide 9: Revenue, gross margin, and profit/(loss)
Revenue, gross margin, and profit/(loss) Takeaways: • Revenue 1H FY25 of ~NZ$12.2m (+32% pcp) • Gross margin percentage 1H FY25 of ~67% (up from ~59% pcp) • Net loss was ~NZ$6.9M (pcp ~NZ$6.4M). Net loss includes non-cash items of ~NZ$3.7m (pcp ~NZ$2.2m) • Cash used in operations improves to ~NZ$2.6
Slide 10: Key metrics table
Key metrics table 1H FY25 1H FY24 % Change Other Takeaways: Total Revenue $12.2m $10.5m +16% • Total cash and receivables as at 30 September 2024 of Platform Subscriptions ~NZ$11.1m, comprised of ~NZ$6.8m cash and Total # of Subscription Customers 413 368 +12% ~NZ$4.3m receivables, with payables of
Slide 11: Consolidated Interim Statement of Profit or Loss
Consolidated Interim Statement of Profit or Loss ikeGPS 11
Slide 12: Consolidated Interim Balance Sheet
Consolidated Interim Balance Sheet ikeGPS 12
Slide 13: Consolidated Interim Balance Sheet cont.
Consolidated Interim Balance Sheet cont. ikeGPS 13
Slide 14: Progress update since the release of the quarterly performance update mid-October 2024
Progress update since the release of the quarterly performance update mid-October 2024
Slide 15: October to mid-November update
October to mid-November update • Continued sales momentum • In the period from 1 October to mid-November, an additive ~NZ$2.8m of Total Contract Value closed from sales of the IKE PoleForeman subscription product. This equates to an additional ~NZ$0.7m of ARR added from IKE PoleForeman only. • In th
Slide 16: Update & Outlook
Update & Outlook The commentary below reflect what was released in the mid-October 2024 performance update. It is repeated here for consistency.
Slide 17: IKE PoleForeman as the Standard for Distribution Network Design
IKE PoleForeman as the Standard for Distribution Network Design. New SaaS Product to Market https://ikegps.com/ike-poleforeman/ Takeaways: • The new IKE PoleForeman product has been in-market for ~nine months and to date has generated ~$12.5m in Total Contract Value and has increased IKE’s ARR by ~N
Slide 18: AI-based automation products in-market Q2
AI-based automation products in-market Q2. Built to drive dramatic productivity improvements into specific distribution-network engineering workflows. ikeGPS 18
Slide 19: Double-Wood Detective AI Product
AI-based automation products in-market Q2. Double-Wood Detective AI Product Detect Validate Change detection Locate undetected instances of Confirm instances of double wood from Capture changes to double wood records, double wood existing records. such as pole removal status. ikeGPS 19
Slide 20: Joint-Use Ticket Automation AI Product
AI-based automation products in-market Q2. Joint-Use Ticket Automation AI Product Violation reporting Make-ready construction Pole transfers Address common issues that arise during Prep poles for new attachments while Transfer attachments from an existing inspections and audits, such as NESC maintai
Slide 21: Appendices
Appendices Manaakitanga: We Rise By Lifting Others ikeGPS 21
Slide 22: What IKE does, and the large, long-term North American market opportunity
What IKE does, and the large, long-term North American market opportunity being addressed Customer and Market re-cap
Slide 23: Selling and Delivering Directly from Colorado, USA HQ
Selling and Delivering Directly from Colorado, USA HQ Meet some of the IKE people representing the next generation CX of our industry Liz Etzel Sara Deere Product Manager: Knows virtually Systems Engineer: Current holder of every customer and is persnickety the world-record for running about exempla
Slide 24: IKE has developed Software Products to Engineer a Network through its Lifecycle
IKE has developed Software Products to Engineer a Network through its Lifecycle <Network Planning> <Assessment & Digitization> <Network Design> <Network Maintenance & Resilience> Business model upshot • A recurring Subscription to access any IKE Solution • Additive, reoccurring revenue based on usag
Slide 25: More than 3,000 electric utilities and 200M distribution assets across the U.S.
Communications Market Macro More than 3,000 electric utilities and 200M distribution assets across the U.S. Investing in decades-long grid resiliency and grid capacity programs Facing common challenges • Grid resiliency requirements • Regulatory and Engineering code compliance • Grid capacity requir
Slide 26: 25-year Macro-Market Tail Wind for Grid Resiliency & Expansion
25-year Macro-Market Tail Wind for Grid Resiliency & Expansion ($B’s) An Electric Utility Industry, Spending 100’s of Billions, in Need for Productivity Solutions, such as IKE $NZD in B U.S. AND CANADIAN ELECTRIC DISTRIBUTION CAPITAL EXPENDITURES ACTUAL Canadian Muni Co-ops US IOU FORECASTED $110.1
Slide 27: Where IKE sells: U.S. Market-Map of Investor-Owned Utilities
Where IKE sells: U.S. Market-Map of Investor-Owned Utilities (multi-$B companies) A huge expansion opportunity…… ikeGPS 27
Slide 28: Plus >2,800 Municipalities and Co-Operatives
Plus >2,800 Municipalities and Co-Operatives All of which represent sales opportunities for IKE products Takeaways • Market timing is everything • IKE is in the right place, at the right time, and with the right technology, team and execution capability • Today, IKE has a presence in approximately 6
Slide 29: 8 of the 10 largest Investor-Owned Utilities have standardized on IKE
8 of the 10 largest Investor-Owned Utilities have standardized on IKE IKE Lands-then-Expands Communications Takeaways • 8 of the 10 largest Investor-Owned Utilities (“IOUs”) in North America, all multi-billion dollar businesses • >400 customers in North America, Electric Utilities with 59 new logos
Slide 30: IKE solutions make fiber and 5G network deployments faster
IKE solutions make fiber and 5G network deployments faster • >$300B expected investment into fiber network development in the U.S over next 5+ years • >$50B expected investment into 5G network development in the U.S. over the next 5+ years • An additional >$60B expected investment into rural broadba
Slide 31: Fiber and 5G Investment Super-Cycle in North America Still In Its Early Stages
Fiber and 5G Investment Super-Cycle in North America Still In Its Early Stages PROJECTED INVESTMENTS INTO 5G & FIBER OPTIC INFRASTRUCTURE $NZD $72B $43B $39B 2010 2018 2025 ikeGPS 31 Source: Bell Potter Initiation of Coverage Report, GSMA, American Tower Note: Labeled Capex F igures reflect Houlihan
Slide 32: Some of the largest U.S. Communication groups have Standardized on IKE
Some of the largest U.S. Communication groups have Standardized on IKE And a growing footprint of tier-2 fiber businesses Communications Takeaways • Several of the largest comms group in North America: AT&T ($107B), Crown Castle ($39B), Bell Canada ($47B) Electric Utilities • A growing footprint of
Slide 33: Overall a Large Addressable Market Opportunity That is Expected to Grow
Overall.. a Large Addressable Market Opportunity That is Expected to Grow Utilities 5G and Fibre $NZD $NZD Estimated 5G Small Cell Fibre Connections $113 Cost of Antenna New Build per Pole 25M Poles Used for Other Services2 Estimated 40M Poles $50 Cost of Needed for Audit per Audit per Pole annum >2
Slide 34: Market Tailwinds Over the Coming Decades
Market Tailwinds Over the Coming Decades Requirement for harder and higher >3,200 capacity distribution power networks Electric Utilities in North America with long-term, recurring across all of North America distribution network hardening, joint use, and capacity needs for electrical distribution 7
Slide 35: A Map-View of Usage: Crown Castle in Florida
A Map-View of Usage, and how IKE customers deploy our software Crown Castle in Florida ikeGPS 35
Slide 36: A map-view of Usage: AT&T in 7 example States
A map-view of Usage, and how IKE customers deploy our software AT&T in 7 example States ikeGPS 36
Slide 37: A strengthened team of North American industry experts
A strengthened team of North American industry experts Key directors and senior leaders appointed through this past year Roz Buick Non-executive Director Roz brings more than 25 years’ experience from executive leadership positions across global utility, engineering, construction, real estate and ag
Slide 38: Multiple Avenues Supporting Future Growth Potential
Multiple Avenues Supporting Future Growth Potential Sales Team Cross Sell & Platform for International 1 Expansion / 2 Upsell 3 Inorganic Growth 4 Expansion New Logos 4 3 2 1 $43mm Sales Team Revenue Expansion / New Cross Sell & Upsell into Inorganic International Revenue “Today” Customers Existing
Slide 39: Thanks
Thanks Manaakitanga: We Rise By Lifting Others ikeGPS 39
Slide 40: Q&A We're IKE, The PoleOS Company
Q&A We’re IKE, The PoleOS Company IKE seeks to be the standard for collecting, analyzing and managing pole and outside plant (“OSP”) information for electric utilities, communications companies, and their engineering service providers The IKE platform allows its customers to increase speed, improve