Softwareone Holding Ltd. · SIX:SWON
Softwareone — Investor Day (February 2024)
83 slides from Softwareone's investor day presentation, Feb 15, 2024
Slide 1: Slide 1
Slide 2: SoftwareOne Capital Markets Day 2024
SoftwareOne Capital Markets Day 2024 15 February 2024
Slide 3: Disclaimer
Disclaimer Forward-looking statements This presentation may contain certain forward-looking statements relating to SoftwareOne Holding AG (the ‘Company’) and each of its subsidiaries and affiliates (jointly referred to as ‘SoftwareOne’ or the ‘group’) and its future business, development and economi
Slide 4: Agenda
Agenda 14:00 – 14:30 Brian Duffy, CEO Vision 2026: A new chapter of growth Bernd Schlotter, President Software & Cloud 14:30 – 15:10 Portfolio, platforms & delivery Rohit Nagarajan, CRO 15:10 – 15:25 Customer impact 15:25 – 15:45 Coffee Break Julia Braun, CHRO 15:45 – 16:00 Talent Rodolfo J. Savitzk
Slide 5: SoftwareOne a new chapter of growth
SoftwareOne a new chapter of growth Brian Duffy CEO
Slide 6: Vision 2026 key takeaways
Vision 2026 key takeaways 01 Highly attractive market opportunity driven by software & cloud growth, enhanced by growth priorities and bolt-on M&A 02 Solid foundation for next chapter of growth with new leadership team and strengthened organisation through operational excellence 03 Focus on leveragi
Slide 7: Solid performance with 8% growth and margin of over 24%
Solid performance with 8% growth and margin of over 24% FY 2023 group results(1) EMEA CHFm, % YoY (ccy) 609.8 +7.6% NORAM 149.1 +0.0% APAC LATAM 144.3 +24.6% 99.7 Revenue 1,010.9 +8.0% +0.2% Adj. EBITDA 245.2 +6.5% Margin 24.3% (0.2)pp 7 (1) FY 2023 financial information is unaudited (1) All financi
Slide 8: SoftwareOne today
SoftwareOne today
Slide 9: SoftwareOne today
SoftwareOne today Based on FY 2023 65k+ clients worldwide 60+countries CHF 21.7bn 4 regions at scale Group billings 7.5k 2030 CHF 1bn software vendor relationships net zero ambition(1) Revenue 8.0% YoY ccy growth ~ 9,300 FTEs 460+ CHF 245m incl. cloud experts with 5,000+ Adj. EBITDA certifications(2
Slide 10: Our 2030 sustainability agenda
Our 2030 sustainability agenda Climate commitment Social responsibility Corporate governance • Achieve net zero for scope 1 & 2 • Become globally recognised • Implement mandatory training by 2030 Employer of Choice of Diversity on Code of Conduct • Help clients reduce their carbon • Support >3,000 N
Slide 11: Megatrends driving massive market opportunity
Megatrends driving massive market opportunity Public cloud adoption Managing cloud spend rises Demand for AI & Data analytics continues to accelerate to top priority explodes Public cloud services to grow 20% YoY in 82% of organisations cite managing spend 70% of organisations exploring 2024, reachi
Slide 12: Fast-growing addressable market
Fast-growing addressable market SoftwareOne SAM – Marketplace and Services(1) US$ bn, % CAGR +17% 149 30 SoftwareOne Client Portal +15% unlocks larger market opportunity, 93 raising growth outlook from 9% in S&C 19 Marketplace to 15% CAGR to 2026. 120 +18% 74 2023 2026 S&C Services S&C Marketplace S
Slide 13: Our customer segmentation
Our customer segmentation New revenue-based segmentation ($) Share Rev. Cust. Large Enterprise (>5bn) 26% 5% 14% 18% Corporate (1bn to 5bn) SME (<1bn) Enterprise Public Sector 14% 6% Corporate 46% 71% SME Note: Breakdown based on customer revenue based on information sourced from 13 HG Insights, C
Slide 14: Diversified across regions and end-markets
Diversified across regions and end-markets Revenue by business line Revenue by geography Revenue by end-market 10% 15% 17% 14% 11% 46% 22% 54% 15% 61% 11% 13% 12% S&C Marketplace S&C Services EMEA NORAM APAC LATAM TMT Financial services Consumer goods, retail & wholesale Public services & education
Slide 15: Our competitive differentiation
Our competitive differentiation Unparalleled global Large client base World-class Customer Diverse, presence with cross-sell advisory insights qualified talent opportunity capabilities base 15
Slide 16: Key actions taken to build strong foundation
Key actions taken to build strong foundation New leadership hires and operating model Integration of Marketplace & Services to promote outcomes-based approach for clients Operational excellence, with strengthened execution capabilities and S&C Services margin progression New large-scale customer win
Slide 17: A world-class leadership team
A world-class leadership team Brian Duffy Rodolfo J. Savitzky Bernd Schlotter Julia Braun Rohit Nagarajan Chief Executive Officer Chief Financial Officer President Software & Cloud Chief HR Officer Chief Revenue Officer Reinhard Waldinger Stephan Timme Raphael Erb Sonia Caso S. Kitzmiller, S. Cronin
Slide 18: A world-class leadership team
A world-class leadership team Brian Duffy Rodolfo J. Savitzky Bernd Schlotter Julia Braun Rohit Nagarajan Chief Executive Officer Chief Financial Officer President Software & Cloud Chief HR Officer Chief Revenue Officer Reinhard Waldinger Stephan Timme Raphael Erb Sonia Caso S. Kitzmiller, S. Cronin
Slide 19: Partner testimonials
Bill McDermott Daniel Bernard Chairman and CEO Chief Business Officer ServiceNow Crowdstrike The SoftwareOne / ServiceNow partnership is being expanded to SoftwareOne is a great partner and gives us scaled reach to capitalize on this once-in-a-generation opportunity. Brian and thousands of global cu
Slide 20: Introducing Vision 2026
Introducing Vision 2026 20
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Slide 22: Focus on lead business, expanding to high-growth segments
Focus on lead business, expanding to high-growth segments Fast-tracking Accelerating data & AI adoption the cloud journey Simplifying cloud Enhancing workforce access and support productivity Expand Maximising ROI of Lead software and cloud spend 23
Slide 23: Targeting our portfolio across customer segments
Targeting our portfolio across customer segments New revenue-based segmentation ($) Share Rev. Cust. Large Enterprise (>5bn) 26% 5% 14% 18% Corporate (1bn to 5bn) SME (<1bn) Software & cloud access and support Enterprise Public Sector Accelerating the cloud 14% 6% journey Maximizing ROI of softwar
Slide 24: Sharpening execution of strategy
Sharpening execution of strategy 01 Transformed 02 Portfolio 03 Delivery 04 Talent go-to-market innovation excellence ecosystem • Commercial excellence with fully • Productised and • Competitive global • Global, diverse and highly integrated salesforce modularised offerings footprint coupled with qu
Slide 25: Growth priorities to capture market opportunity
Growth priorities to capture market opportunity 01 Deepen partnership with hyperscalers 02 Drive global Microsoft Copilot roll-out 03 Capitalise on data & AI 04 Execute on focused ISV strategy 05 Leverage Marketplace platform 26
Slide 26: Vision 2026: accelerating growth and expanding margin
Vision 2026: accelerating growth and expanding margin Mid-teens Dividend pay-out Adj. EBITDA margin Revenue growth(1) 30-50% adj. profit approaching 28% 27 (1) In constant currency
Slide 27: Portfolio, platforms & delivery
Portfolio, platforms & delivery Bernd Schlotter President Software & Cloud 28
Slide 28: Drivers for our right to win
Drivers for our right to win • Existing client base • Customer insights based on 20+ years of history with unparalleled reach • Core strength across SME, Corporate, and Enterprise Simplifying Enhancing cloud access workforce productivity • Credibility and track record in licensing and support and I
Slide 29: Key offerings
Key offerings Simplifying cloud access and Maximising ROI of software Enhancing workforce support and cloud spend productivity • Buy software & cloud • Lower software & cloud cost • Work in a secure environment • Migrate to the cloud • Manage your software & cloud • All in one workplace • Manage clo
Slide 30: Leveraging lead business to expand into high-growth segments
Leveraging lead business to expand into high-growth segments Accelerating the cloud journey • Application modernisation • Application development • DevOps • Application security • SAP Services Fast-tracking Accelerating the data & AI adoption cloud journey Fast-tracking data & AI adoption • Data fou
Slide 31: Corporate Client Case Study: Financial Services
Corporate Client Case Study: Financial Services ITAM Major Publisher Managed Service Re-licensing FinOps Native Cloud App App Managed Development Services Workplace ITAM Microsoft Application Application Advisory Advisory EA Modernization Modernization Wave 1 Wave 2 Unified Managed Services Vendor O
Slide 32: Deepening our relationship with hyperscalers
Hyperscalers Deepening our relationship with hyperscalers Coinvest Fast-track data & AI App migration and Security Build a SME focused CoE Copilot! modernisation Jointly accelerate with focused leadership to Accelerate consumption managed security pipeline accelerate growth Bedrock & Sagemaker reven
Slide 33: Leading with our Copilot capabilities
Leading with our Copilot capabilities Microsoft Copilot ROI 12.5m Providing clear guidance on use case scenarios Addressable 365 seats Risk Contributing deep security, data and platform expertise 15% Adoption rate Readiness Delivering integration, programme management, adoption and change management
Slide 34: Our first-to-market Copilot offering
Our first-to-market Copilot offering Microsoft Copilot 35
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Slide 36: Igniting the broader data and AI opportunity
Igniting the broader data and AI Data & AI It’s all about AI plus infrastructure, data, Rationalise migration, modernisation… your estate $150B only 8% Get to the cloud Generative AI could drive an Have achieved digital optimisation additional $150 billion in software and transformation goals(3) spe
Slide 37: SoftwareOne Intelligence Fabric
SoftwareOne Intelligence Fabric Data & AI Breadth of Proven expertise – 80 Ecosystem synergy Commercial capabilities new Data & AI excellence 800+ Azure clients projects delivered in use MSFT Data & AI H2 ‘23 services Security & Governance Partnerships 38
Slide 38: Extensive Multivendor cross-sell opportunities
Hyperscalers Microsoft Copilot Data & AI Extensive Multivendor cross-sell opportunities ISV Strategy Marketplace Platform ITAM / FinOps ITAM / FinOps Infrastructure Infrastructure Security Security Applications Content Management 39
Slide 39: Driving execution and delivery excellence – imperatives
Hyperscalers Microsoft Copilot Driving execution and delivery excellence – imperatives Data & AI ISV Strategy Marketplace Platform S&C Services S&C Marketplace Drive margin expansion while Maintain industry-leading growing revenue double digit profitability Provide world-class customer Increase win
Slide 40: Services – margin expansion while growing double digit
Hyperscalers Microsoft Copilot Services – margin expansion while growing double digit Data & AI ISV Strategy Marketplace Platform • Margin as Sold versus Margin as Adj. EBITDA margin Delivered CHFm, % of revenues Cost transparency • Consumption-based costing 40.0 9.0% • Cost rates by skill, role, an
Slide 41: Differentiated & unique Marketplace Platform
Differentiated & unique Marketplace Platform Hyperscalers Microsoft Copilot Data & AI ISV Strategy Marketplace Platform Public API Systems Vendors Clients Systems Vendor Client & Partners Portal Portal SMB SoftwareOne Marketplace Platform A 2-sided online platform to facilitates Corporate transactio
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Slide 43: KPIs to measure success of Marketplace Platform
Hyperscalers Microsoft Copilot KPIs to measure success of Marketplace Platform Data & AI ISV Strategy Marketplace Platform Clients Subscriptions Gross Sales Transacted 17k+ 30k+ CHF 500m+ 44 Note: Values for full-year for 2023
Slide 44: Portfolio, platforms & delivery key takeaways
Portfolio, platforms & delivery key takeaways 01 Uniquely positioned to deliver outcomes to our clients via integrated solutions. We deliver industry best ROI on software & cloud investment 02 Well-positioned to expand our leadership in SME and to grow our share in corporate segment facilitated by o
Slide 45: Customer impact
Customer impact Rohit Nagarajan CRO 46
Slide 46: First impressions and priorities
First impressions and priorities • Wealth of riches – large, loyal global client base • Trusted technology partner for clients transitioning from old world to new • Build a world-class GTM organisation that leverages the existing scale and reach 47
Slide 47: Transforming our go-to strategy
Transforming our go-to strategy Grow Invest in opportunities where we have been growing below SAM market share Gain Drive sales effectiveness in running existing book of business wallet share Simplify and Consistent and scalable GTM engine across regions to standardize deliver high quality customer
Slide 48: Prioritised initiatives for 2024 as part of the GTM transformation
Prioritised initiatives for 2024 as part of the GTM transformation • Accelerated growth in NORAM Grow • Double down on focus ISVs and hyperscalers* market share • ‘Better together’ services growth • Increase renewal rates by reducing S&C Marketplace and Services churn/ downsell* Gain • Pricing excel
Slide 49: Transforming our go-to-market approach with differentiated sales motion
Gain Grow Simplify and wallet market standardize share share Transforming our go-to-market approach with differentiated sales motion New revenue-based segmentation ($) Large Enterprise (>5bn) Share Rev. Cust. Corporate (1bn to 5bn) 26% 5% 14% 18% SME (<1bn) Software & cloud access and support Ente
Slide 50: Differentiated coverage model by segment
Gain Grow Simplify and wallet market standardize share share Differentiated coverage model by segment to drive cost-effective, yet scalable revenue growth New revenue-based segmentation ($) Large Enterprise (>5bn) Share Rev. Cust. Corporate (1bn to 5bn) 26% 5% 14% 18% SME (<1bn) High Dedicated Acc
Slide 51: Increasing customer lifetime value through commercial excellence
Gain Grow Simplify and wallet market standardize share share Increasing customer lifetime value through commercial excellence Increase renewal rates to best in class Pricing excellence Engaging early Drive right seller behavior Securing renewals through early, proactive client engagement Minimise lo
Slide 52: Deepening vendor relationships to deliver enhanced multi-cloud services and AI adoption
Gain Grow Simplify and wallet market standardize share share Deepening vendor relationships to deliver enhanced multi-cloud services and AI adoption Industry outlook Priorities Modularized solutions: best-in-class modular Deepen hyperscaler relationships for solutions vs. Integrated suites enhanced
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Slide 54: Customer impact key takeaways
Customer impact key takeaways 01 Investing in selective opportunities to drive our market share, where we have grown below SAM 02 Driving data driven sales effectiveness to gain larger share of wallet 03 Simplifying and standardizing the GTM engine across regions for efficiency and scalability 55
Slide 55: We will resume in 20 minutes
we will resume in 20 minutes
Slide 56: Talent
Talent Julia Braun CHRO
Slide 57: Global, diverse and highly qualified talent base
Global, diverse and highly qualified talent base Based on FTEs at 31 December 2023 18% 1% ~9,300 25% 41% FTEs 230 in 2023 33% By region 17% By function 65% By gender 5,000+ cloud certifications(1) 28% 66% 6% EMEA Product & delivery Male 1,300+ architects, developers, & designers NORAM Sales Female L
Slide 58: People & Culture is key to deliver Vision 2026
People & Culture is key to deliver Vision 2026 Business partnering Centre of excellence –talent, engagement and rewards Supporting strategy execution by partnering with the business to Vision 2026 Best-in-class approach to talent, drive excellence across our talent development, engagement and pool r
Slide 59: Key initiatives to support Vision 2026
Key initiatives to support Vision 2026 Talent attraction & Talent management & Compensation & sourcing people development reward structure Close the skill-competency gap Succession planning Sales compensation • Shift from jobs to skills • Fuel the pipeline for leadership • Simple plans, linked to ob
Slide 60: Investing in our talent – SoftwareOne Academy
Investing in our talent – SoftwareOne Academy • A globally unified learning experience offering a career path into technology • Targeting 20% of net new positions at >460 learners since foundation in 2021 SoftwareOne 85% transition rate to business Academy incubator Apprentices ~115 learners / >90%
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Slide 62: Talent key takeaways
Talent key takeaways 01 Global, diverse and highly skilled talent base, including cloud experts with 5,000+ certifications People & Culture strategy fully aligned with business to support achievement of Vision 2026 02 targets, building on business partnering, Centres of Excellence and HR Operations
Slide 63: Value creation
Value creation Rodolfo J Savitzky CFO
Slide 64: Q4 and FY 2023 results
Q4 and FY 2023 results 65
Slide 65: Solid performance in line with revised revenue guidance
Solid performance in line with revised revenue guidance P&L summary(1) CHFm Q4 2023 % Δ CCY(3) FY 2023 % Δ CCY(3) Revenue(2) 270.7 6.6% 1,010.9 8.0% Delivery costs (84.0) 0.3% (347.6) 5.3% Contribution margin 186.7 9.6% 663.3 9.4% Contribution margin (% revenue) 69.0% +1.5pp 65.6% +0.9pp SG&A (101.1
Slide 66: Improved adj. EBITDA margin in S&C Services
Improved adj. EBITDA margin in S&C Services Business line P&L(1) CHFm Software & Cloud Services(2) Software & Cloud Marketplace FY 2023 % Δ CCY(3) FY 2023 % Δ CCY(3) Revenue 461.2 11.0% 549.7 5.6% Delivery costs (275.6) 6.3% 1.5% (72.0) Contribution margin 185.6 18.7% 477.8 6.2% Contribution margin
Slide 67: Operational excellence delivering well ahead of plan
Operational excellence delivering well ahead of plan Execution against plan 2024 target Cost savings vs. target CHFm 70 47 Commercial effectiveness 15 Efficient delivery model 2023 target 2023 actual New annualised target 2024 Restructuring expenses (CHFm) 25(1) 39 10 Right-sized support functions •
Slide 68: Strong operating cash flow and balance sheet
Strong operating cash flow and balance sheet Cash conversion Net cash development CHFm CHFm Net cash 317.5 73%(1) 31 Dec 2022 Cash conversion 180.0 M&A investments and earn- (55.5) out payments Taxes (46.2) Financing expenses, dividend and SBB (96.8) Capitalised Capex Change in Cash conversion Adj.
Slide 69: Value creation
Value creation 70
Slide 70: Strongly positioned to drive profitable growth and shareholder value
Strongly positioned to drive profitable growth and shareholder value 01 02 03 Higher growth Margin expansion Maximising value • Attractive SAM • Operating leverage • Investing for growth • Transformed GTM • Operational excellence • Progressive dividend policy • Growth priorities • Pricing realisatio
Slide 71: Track record of growth, stable margin and attractive returns
Track record of growth, stable margin and attractive returns Revenues Adj. EBITDA DPS & payout ratio CHFm, CAGR (% YoY ccy) CHFm, margin (%) CHF, payout ratio (%) 24.5% 24.5% 24.3% 46.5% 47.3% 50.5% 10.7% 0.4 1040 1,010.9 250.0 245.2 0.4 0.36 982.8 990 245.0 240.4 0.35 240.0 0.4 940 235.0 0.33 897.1
Slide 72: Vision 2026: path to revenue growth acceleration
Vision 2026: path to revenue growth acceleration Revenue growth %, Illustrative CAGR, % 1% to 2% Mid-teens 2% to 3% Mid-teens 4% to 5% Bolt-on M&A 17% Growth priorities Sharpened execution 8% • GTM transformation • Hyperscalers • Capabilities • Portfolio Innovation • Copilot • Geographies 15% • Deli
Slide 73: Operational excellence to drive further effectiveness and efficiency in 2024
Operational excellence to drive further effectiveness and efficiency in 2024 Commercial effectiveness Efficient delivery model Right-sized support functions • Improve sales productivity based on • Modularise services • Drive IT effectiveness/efficiency new segmentation • Standardise and automate end
Slide 74: Operational excellence beyond 2024
Operational excellence beyond 2024 Examples Analytics-powered GTM AI-based sales models, tech-enabled salesforce and hyper- 'Next Best Action' recommendation engine personalisation for clients Automation and GenAI in enabling functions Enabling functions as Strategic Business Partners leveraging dat
Slide 75: Margin expansion driven by operating leverage and operational excellence
Margin expansion driven by operating leverage and operational excellence Adj. EBITDA margin %, Illustrative c. 2% Approaching 28% 3% to 4% -1% to -2% Operational excellence Operating leverage Business mix 24.3% • Services standardisation and • Higher services mix • Operational excellence scale up •
Slide 76: Continued solid cash generation
Continued solid cash generation Capital expenditure Net working capital inflow(1) Cash conversion(2) CHFm CHFm % 74 ~75 2022 2023 2024-2026 ~70% ~ 73% 64 55% 2022 2023 2024-2026 (158.3) (160.9) Stable 2022 2023 2024-2026 Capex Capitalised leases • Marketplace platform • Net working capital financing
Slide 77: Balanced capital allocation priorities to drive long-term value creation
Balanced capital allocation priorities to drive long-term value creation Reinvest in growth Return to shareholders • Organic growth strategy • SoftwareOne Marketplace platform • Commitment to dividend of 30-50% of adjusted profit, with proposed FY 2023 dividend of CHF 0.36 per share Priorities • Com
Slide 78: Growth acceleration and margin expansion by 2026
Growth acceleration and margin expansion by 2026 2024 Vision 2026 Transition to higher growth Profitable growth and shareholder value Guidance Revenue growth(1) 8-10% Mid-teens Adj. EBITDA margin 24.5-25.5% Approaching 28% (% revenue) 30-50% adjusted profit for the year 30-50% adjusted profit for th
Slide 79: Value creation key takeaways
Value creation key takeaways 01 Well-positioned to drive profitable growth and shareholder value 02 Acceleration in growth driven by transformed go-to-market strategy and growth priorities 03 Margin expansion underpinned by operating leverage and operational excellence 04 Strong cash conversion with
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Slide 81: Vision 2026 key takeaways
Vision 2026 key takeaways 01 Highly attractive market opportunity driven by software & cloud growth, enhanced by growth priorities and bolt-on M&A 02 Solid foundation for next chapter of growth with new leadership team and strengthened organisation through operational excellence 03 Focus on leveragi
Slide 82: Q&A
Q&A 83
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