Terago Inc. · TSX:TGO
Terago — Investor Presentation (March 2020)
19 slides from Terago's investor presentation, March 2020
Slide 1: Investor Presentation
Investor Presentation March 2020
Slide 2: Forward-Looking Information
Forward-Looking Information This presentation includes certain forward-looking statements that are made as of the date capital that may not be available to the Company, and those risks set forth in the “Risk hereof and are based upon current expectations, which involve risks and uncertainties Factor
Slide 3: Non-GAAP Measures
Non-GAAP Measures Adjusted EBITDA provisioned, as at the end of the period. TeraGo’s method of calculating backlog MRR may differ from other issuers and, accordingly, backlog MRR may not be comparable to similar The term “EBITDA” refers to earnings before deducting interest, taxes, depreciation and
Slide 4: TeraGo at a Glance
TeraGo at a Glance 24/38 GHz NATIONAL Wireless and Fibre Network Spectrum covering ~8.6 billion MHz-Pops $48M 2019 Revenue ~3,000 Customers 92% of Licensed mmWave $18M 2019 Adj. EBITDA* Spectrum held 5 Data Centres 600+ Deployed Towers $>3B Enterprise TAM *Adjusted EBITDA includes the adoption of IF
Slide 5: Largest Holder of mmWave Spectrum in Canada
Largest Holder of mmWave Spectrum in Canada Coverage includes Spectrum Coverage Map – Spectrum Coverage Map – 2,210 MHz of 24 GHz (14 of 20 licenses issued) 38 GHz (25 of 27 licenses issued) Canada’s 6 Licenses from 100-199 MHz largest cities Licenses from 200-299 MHz Edmonton Licenses over 300 MHz
Slide 6: Regulatory Conditions Support mmWave Value
Regulatory Conditions Support mmWave Value 5G Fixed UNITED STATES Wireless Access already permitted with May 2017 Jan 2019 Jun 2019 Jan 2020 a clear path to Verizon to acquire FCC completes 28GHz FCC’s completes 24GHz The 37-39 GHz licenses sold on average for $0.0096/MHz pop — mobile services Strai
Slide 7: 5G Fixed Wireless Ready Footprint
5G Fixed Wireless Ready Footprint mmWave Spectrum Market Share Business Connectivity Total TeraGo’s in Canada (based on MHz-PoPs) Addressable Market1 mmWave assets have scarcity 24 GHz 38 GHz Total value and provide Bell Bell ABC 1-499 Telus ABC Telus 4% a time to market 5% 5% Xplornet 0.5% 0.5% 4%
Slide 8: 5G Fixed Wireless Access
5G Fixed Wireless Access 5G FWA Trial Underway Other 5G FWA Trials & Deployments TeraGo is uniquely First phase technical trial complete: positioned to be • Up to 700 Mbps per first carrier in customer end point Canada to launch • Latency of 3-4ms 5G Fixed Wireless Services Second phase technical tr
Slide 9: Financial Highlights
= Go Financial Highlights 9
Slide 10: Multi-Pronged Strategy – Update & Outlook
Multi-Pronged Strategy – Update & Outlook 1. 2. 3. Profitable Building a Positioned for 5G business and premier channel Fixed Wireless positive and alliance FCF generation program 10
Slide 11: Strengthen the Connectivity Business
Strengthen the Connectivity Business: Significant future opportunity leveraging existing fixed wireless footprint Manage Churn and Backlog MRR Churn ARPU Create Up-sell $92,096 Opportunities in $64,659 $71,624 $57,081 1.6% Our Customer Base 1.4% 1.5% 1.3% 1.4% $1,054 $1,033 $1,023 $1,014 $1,019 $47,
Slide 12: Growth from Cloud and Colocation
Growth from Cloud and Colocation: Continued market demand for managed services under the Hybrid IT model Investing in our Sales Backlog MRR Churn ARPU Organization to Accelerate Growth $3,221 $3,185 $3,248 $3,393 1.7% $3,138 and Target the Right 1.3% 1.3% $37,094 $37,237 1.1% Customers $31,742 $18,6
Slide 13: Resilient Recurring Revenue Base
Resilient Recurring Revenue Base $59.1 $57.7 $55.4 $40.8 $54.3 $44.6 $51.2 $36.4 $48.4 $35.0 All $ figures in CAD millions $47.8 $30.4 63% 37% 2014 2015 2016 2017 2018 2019 2014 Connectivity $3.4 $13.2 $18.3 $19.0 $19.3 $18.1 Cloud and Colocation 13
Slide 14: Stabilize Adjusted EBITDA and Cash Flow
Stabilize Adjusted EBITDA and Cash Flow 35.5% 31.6% 31.9% 32.1% $18.4 $18.9 $17.5 $16.2 23.2% 23.9% All $ figures in CAD millions $12.6 $12.9 $13.0 $9.4 $9.2 $8.2 $7.4 $7.8 2014 Adjusted EBITDA Margin 2016 2017 2018 2019 2014 2015 2014 Adjusted EBITDA Capital Expenditures *Adjusted EBITDA excludes i
Slide 15: Balance Sheet
Balance Sheet Cash and cash equivalents $8.7 Unused operating line of credit(1) $10.0 Available acquisition facility $25.0 Total cash and access to credit(1) $43.7 Long-term debt $28.5 Operating Leverage 2.7x 15
Slide 16: Experienced Leadership Team • Strong Track Record
Experienced Leadership Team • Strong Track Record Antonio (Tony) Ciciretto Duncan McGregor President & CEO Vice President, Engineering & Operations Duncan is a seasoned executive with 20 years of global experience in the technology President and CEO of Cogeco Peer 1 and Cogeco Data Services for over
Slide 17: Summary
Summary Enterprise- One of Canada’s A Clear Growth Financial Experienced Class Cloud, Largest Holders Opportunity Strength Management Colocation, and of Millimetre in 5G Fixed to Fund Our Team Connectivity Wave Spectrum Wireless Growth Committed to Access Strategy Value Creation 17
Slide 18: Capital Markets Snapshot
Capital Markets Snapshot Stock symbol TSX: TGO Shares outstanding 16.6 million Price at Feb 26, 2020 $7.80 52-week low / high $7.50 / $13.06 Enterprise Value (“EV”) $167.6 million EV / Adjusted EBITDA 9.6x 18
Slide 19: 19
19