Slide 1: Inside Secure FY2017 financial results
Inside Secure FY2017 financial results Amedeo D’Angelo, President & CEO Richard Vacher Detournière, GM & CFO February 22, 2018 www.insidesecure.com 1 |
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: 2017: Successful year as a pure software security player
2017: Successful year as a pure software security player Strong core business revenue and operating leverage Investing in long term growth with 2 acquisitions +9% +37% 23% year-on-year revenue year-on-year EBITDA margin of growth of core growth in license core business in 2017 business to $38.8M in
Slide 4: Accelerated execution of company strategy to bring embedded security, from chips to apps
Accelerated execution of company strategy to bring embedded security, from chips to apps 1 2 3 MANAGE OPERATE INCREASE FOOTPRINT SECURITY NEW SECURITY OF CORE PROPRIETARY SOLUTIONS SERVICES TECHNOLOGIES Acquisition Acquisition Acquisition – – Oct. 2017 – Oct. 2017 Aug. 2017 COMBINING ORGANIC INITIAT
Slide 5: Reinforced portfolio of proprietary core technologies organically
INCREASE FOOTPRINT OF CORE PROPRIETARY TECHNOLOGIES 1 Reinforced portfolio of proprietary core technologies organically Security at the heart of chips Security of communication Security of application Security of content The largest silicon-proven security IP Secure communication and Comprehensive p
Slide 6: Core technologies to secure automotive with great potential ahead
INCREASE FOOTPRINT OF CORE PROPRIETARY TECHNOLOGIES 1 Started to provide core technologies to secure automotive with great potential ahead • Multiple design wins to secure intelligent and connected car • Inside is increasingly seen as a critical technology provider and Long-term Video protection mov
Slide 7: Leveraging long-term relationship to address IoT security challenges
INCREASE FOOTPRINT OF CORE PROPRIETARY TECHNOLOGIES 1 Demonstrated capability to leverage long-term relationship to address IoT security challenges • Strong history on securing communications, from servers to CPU- and-memory-constrained environments • FIPS-certified cryptography (the U.S. government
Slide 8: Enabling a leading US bank to bring increased security in mobile banking
INCREASE FOOTPRINT OF CORE PROPRIETARY TECHNOLOGIES 1 Enabling a leading US bank to bring increased security in mobile banking, over time Enabling a leading US bank to bring increased security in mobile banking, over time Strong authentication Providing additional 2017 technology • 50 mobile banking
Slide 9: Leveraging leadership in content protection for new security challenges
1 INCREASE FOOTPRINT OF CORE PROPRIETARY TECHNOLOGIES Leveraging our leadership in content protection to enable our customers to address new security challenges Inside Secure protects Lufthansa Inside Secure selected by Neopost to Inside Secure selected by HTC to Technik’s inflight entertainment on
Slide 10: Leveraging the acquisition of SypherMedia
MANAGE SECURITY SOLUTIONS 2 Leveraging the acquisition of SypherMedia to build a critical and complete general chip security solution • SypherMedia: a key player in Silicon IP security and • Acquired in November 2017 provisioning solutions • Los-Angeles based company, 11 employees • Important additi
Slide 11: Leveraging the acquisition of Meontrust
OPERATE NEW SECURITY SERVICES 3 Leveraging the acquisition of Meontrust to build a strong authentication service offering • Meontrust develops security solutions to facilitate deployment of strong customer two-factor authentication • Acquired in August 2017 • A Finnish emerging growth company • Addi
Slide 12: Increasingly supporting world top companies in managing new security challenges
Increasingly supporting world top companies in managing new security challenges Security at the heart of chips Security of communication Security of application Security of content Major Semiconductor Companies Top IT Companies Banks and payment systems Content distributors 12 | Inside Secure – Febr
Slide 13: 2017 in a nutshell
2017 in a nutshell • Inside Secure as a pure play in security software, after 2016 transformation year • Growing traction in IoT and Automotive markets • Expanding from product development to service deployment • Hired key managers and sales and build stronger sales and marketing force • Built a str
Slide 14: Inside Secure FY2017 financials
Inside Secure FY2017 financials Richard Vacher Detourniere, GM & CFO February 22, 2018 www.insidesecure.com 14 |
Slide 15: Basis of presentation of FY17 financials
Basis of presentation of FY17 financials The revenue and results for the fiscal year 2017 have been prepared in accordance with IFRS 15 "Revenue from Contracts with Customers", which is mandatory from January 1, 2018. The Company has chosen to anticipate the implementation of the standard, in partic
Slide 16: 2017: Software-based activity driving strong operating leverage
2017: Software-based activity driving strong operating leverage +9% X4.4 16 | Inside Secure – February 2018
Slide 17: 2017: Significant growth in licenses to seed future organic growth
2017: Significant growth in licenses to seed future organic growth HALF-YEAR LICENSE REVENUE RUN x2 RATE OVER 2 YEARS (IN M$) • Reaping the benefit of investing in sales development * • Addressing new security challenges to up-sell customers (ex: content protection / vitual reality) x2 • Leveraging
Slide 18: 2017 Core business revenue growing by +9% vs. 2016
2017 Core business revenue growing by +9% vs. 2016 +9% 38.8 35.8 26.6 +20%: year-on-year revenue growth excluding contribution * of a U.S. customer driving significant royalties +37%: growth in new license revenue in 2017 Growth in maintenance and development agreements in line with overall activity
Slide 19: Demonstrated software business model driving strong operating leverage
Demonstrated software business model driving strong operating leverage in million $ 2016 2017 Core business revenue 35.7 38.8 Gross profit 34.7 37.6 as % of revenue 97% 97% Operating expenses (33.5) (29.3) as % of revenue 94% 76% Operating income 1.2 8.3 as % of revenue 3.4% 21.4% EBITDA of core bus
Slide 20: Restarting investments in H2 2017 to support future growth
Restarting investments in H2 2017 to support future growth EVOLUTION OF OPERATING EXPENSES FOR CORE BUSINESS (in $M) 18.2 16.4 15.7 15.2 15.3 13.7 Reengaging with investments to seed future growth. G&A and other Income/expense cost base consistent with company size. Including one-time savings of 1.5
Slide 21: From adjusted income to IFRS net income
From adjusted income to IFRS net income in million $ 2016 2017 Adjusted operating income Core business 1.2 8.3 3 NFC licenses in 2016 vs. nil in Adjusted operating income "NFC" 9.7 (0.6) 2017 Adjusted consolidated operating income 10.9 7.7 Amortization of intangible assets from acquired businesses (
Slide 22: 2017: Strong cash generation and increase in cash position
2017: Strong cash generation by core business and strong increase in cash position Convertible bonds (+17.2) Sale of listed $45.9 m WISeKey shares (+11.2) SMI and Other, Meontrust including purchase financial price interest and consideration income tax $27.1 m Change in (- 11.8) (- 1.4) working capi
Slide 23: Inside Secure Looking ahead
Inside Secure Looking ahead Amedeo D’Angelo, President & CEO February 22, 2018 www.insidesecure.com 23 |
Slide 24: In 2017, Inside Secure accelerated its roadmap to build a unique and strategic position
In 2017, Inside Secure accelerated its roadmap to build a unique and strategic position at the heart of connected devices and apps • We are positioned on security at the heart of billions of connected devices and apps • We leverage the right proprietary technologies to enable service providers to ha
Slide 25: Focusing on selected markets with high growth potential
Focusing on selected markets with high growth potential IoT/ Automotive Networking Security Telecom & Enterprise Video Content & Entertainment Financial & Insurance & Gaming 25 | Inside Secure – February 2018
Slide 26: 2018: investing to capture strong market dynamics and support future growth
2018: investing to capture strong market dynamics and support future growth • Continue to sustain strong top line revenue growth with accelerated growth of its core business revenue excluding contribution of a U.S. customer driving significant royalties • Accelerating investments before getting back
Slide 27: Inside Secure: Investment Case
Inside Secure: Investment Case A PURE PLAYER IN SECURITY SOLID ADVANTAGES SUCCESSFULLY TRANSFORMED COMPANY TOWARDS PURE SOTFWARE PLAYER • A pure player player in software • Addressing security needs of billions • 2016: first year of profitable growth, ever and core technologies to secure of connecte
Slide 28: Appendix
Appendix February 22, 2018 www.insidesecure.com 28 |
Slide 29: Basis of preparation
Basis of preparation Implementation of IFRS 15 l The revenue and results of the Company of the fiscal year 2017 have been prepared in accordance with IFRS 15 "Revenue from Contracts with Customers", which is mandatory from January 1, 2018. The Company has chosen to anticipate the implementation of t
Slide 30: Basis of preparation
Basis of preparation Core business l Inside Secure operates with a single core business segment which comprise the Company’s software and silicon intellectual property product offering. It excludes the contribution of the Company’s NFC patent licensing program. It also excludes the semiconductor bus
Slide 31: Sound balance sheet with disciplined cash management to execute the strategy
Sound balance sheet with disciplined cash management to execute the strategy December 31 December 31 in million $ 2016 2017 Includes the consolidation Goodwill and intangible assets 25.3 38.0 of Meontrust and SMI Property, plant & equipment 1.5 1.3 Other receivables 5.4 1.7 Total non current assets
Slide 32: Statement of Cash Flows
Statement of Cash Flows in million $ 2016 2017 Net Cash generated by / (used in) operations for continued operations 7.6 5.1 Net Cash generated by / (used in) operations for discontinued operations (3.6) - Cash generated by / (used in) operations before changes in working capital 4.1 5.1 Cash genera
Slide 33: Core business operating income and EBITDA
Core business operating income and EBITDA in million $ 2016 2017 Revenue 35.8 38.8 Gross profit 34.7 37.6 Research and development expenses (14.2) (11.4) Selling and marketing expenses (11.2) (12.5) General and administrative expenses (7.8) (6.7) Other gains / (losses), net (0.4) 1.3 Operating incom
Slide 34: Reconciliation from Adjusted to IFRS
Reconciliation from Adjusted to IFRS in million $ 2016 2017 EBITDA from continuing operations 12.3 8.8 Amortization and depreciation of assets (*) 1.4 1.1 Adjusted operating income/(loss) from continuing operations 10.9 7.7 Business combinations (**) (3.8) (2.4) Other non recurring costs (4.3) (3.1)
Slide 35: Investor information
Investor information Contacts Inside Secure Inside Secure Corporate communications Investor relations Brigitte Foll Richard Vacher Detournière Marcom Director GM & CFO communication@insidesecure.com contactinvestisseurs@insidesecure.com Financial calendar www.insidesecure.com Q1 2018 revenue. April