Slide 1: Results Presentation
For personal use only Results Presentation Reckon Limited Half year ended June 2007 1
Slide 2: Overview
For personal use only Overview • Reckon taking strong strides towards achieving its mission: to be the leading Australian provider of best of breed business management solutions for the SME, SOHO, Accounting and Wealth Management sectors • Successful results underpin ongoing strategy: target key acq
Slide 3: Overview
For personal use only Overview Reckon Ltd CEO – Clive Rabie CFO – Chris Hagglund Professional Division Business Division CEO – Brian Armstrong CEO – Gavin Dixon Wealth Management Accounting SME/SOHO QuickBooks, Quicken, Reckon.Tools APS suite of products Reckon.Tools, Shelco & Elite 3
Slide 4: Reckon Performance
For personal use only Reckon Performance 4
Slide 5: Performance Highlights - months ended June '07
For personal use only Performance Highlights - 6 months ended June ‘07 Group Revenue up 22.3% to $28.4m EBITDA up 22.6% to $8.2m Operating revenue up 27.9% to $9.4m Operating revenue up 19.6% to $18.7m EBITDA up 31.7% to $2.0m EBITDA up 20.0% to $6.2m 5
Slide 6: Performance Highlights - months ended June '07
For personal use only Performance Highlights - 6 months ended June ‘07 • EPS growth 16% to 3.8 cents • Dividend up by 25% to 2.5 cents per share • Dividend franked to 50% • Operating cash flow up 44% to $6.8m 6
Slide 7: 1st Half Trends over last years
For personal use only 1st Half Trends over last 4 years 1st Half 1st Half 1st Half 1st Half 2004 2005 2006 2007 Revenue 18.8m 21.2m 23.2m 28.4m EBITDA 4.2m 5.5m 6.7m 8.2m NPBT 4.1m 5.2m 5.8m 6.7m EPS 2.2 2.5 3.3 3.8 cents* cents cents cents * Normalised for tax 7
Slide 8: 1st Half Trends over last years
For personal use only 1st Half Trends over last 4 years Revenue 52% Growth over 4 years EBITDA 93% Growth over 4 years 33 28 23 Revenue 18 EBITDA 13 8 3 2004 2005 2006 2007 1st Half 1st Half 1st Half 1st Half 8
Slide 9: 1st Half Margins over years
For personal use only 1st Half Margins over 3 years 1st Half 1st Half 1st Half 2005 2006 2007 EBITDA (pre R&D and Royalties) 8.9m 10.0m 11.8m Margin 40% 43% 42% EBITDA 5.5m 6.7m 8.2m Margin 25% 29% 29% Traditional margin growth is expected to resume in subsequent periods. The current period has been
Slide 10: Cash Flow Highlights - Half year ended June '07
For personal use only Cash Flow Highlights - Half year ended June ‘07 2007 2006 Cash Balance at June ‘07 $11.9m $10.1m Cash Flow from Operations* $6.8m $4.7m +44% Acquisitions $2.3m $2.1m Development Cost Expenditure $1.8m $1.5m Fixed Asset Acquisition $0.3m $0.8m Prior Year Final Dividend Paid $3.3
Slide 11: Revenue Breakdown - Half year ended June '07
For personal use only Revenue Breakdown - Half year ended June ‘07 100% 90% 80% 57% 57% 57% 70% 60% Recurring Revenue 50% Full Product Service Revenue 40% 20% 30% 26% 29% 20% 23% 10% 17% 14% 0% APS Quicken Grp Reckon Prior 1st half recurring 60% 55% 56% revenue 11
Slide 12: Professional Performance
For personal use only Professional Performance 12
Slide 13: APS Performance - Half year ended June '07
For personal use only APS Performance - Half year ended June ‘07 Revenue EBITDA Revenue Up 27.9% Up 31.7% New Sales & Service Growth Up 37.5% Maintenance Growth Up 21.4% 13
Slide 14: APS Performance - Half year ended June '07
For personal use only APS Performance - Half year ended June ‘07 Software revenue Reflects impact of Document management take up Reflects impact of the take up of full product range by clients Reflects continued strong new business sales Consulting revenue Reflects impact of Document management take
Slide 15: Professional Growth Strategies
For personal use only Professional Growth Strategies Strong revenue growth in all categories and all countries Australia • 36 new firms moved to APS in Australia • Major wins – Top four firms switch to APS - WHK Group new national agreement ( 2,000 users) • Strong take up of Desktop Super – 31 new f
Slide 16: Professional Growth Strategies
For personal use only Professional Growth Strategies Expanded fully integrated compliance offering Desktop Super Tax forms, Tax manager & PAYG modules Accounts Preparation Integrated Fixed Assets AdvanceDocs (Collated PDF’s, Document filing & scanning) Company registrations, Trusts and Superannuatio
Slide 17: Business Performance
For personal use only Business Performance 17
Slide 18: Quicken Performance - Half year ended June '07
For personal use only Quicken Performance - Half year ended June’07 Revenue EBITDA Revenue Up 19.6% Up 20.0% Underlying business Up 13.1% Up 19.5% Acquisitions contribute 6.5% 0.5% $1M - New Sales Growth Up 7.8% Direct Sales Growth Up 25.3% 18
Slide 19: Quicken First Half Performance
For personal use only Quicken First Half Performance Better relationships with our customers • Higher Level of sales from existing customers in Upgrades, Advantage & Subscription Better relationships in retail Better relationships with accountants • Increased numbers of PP’s • Increased recommendati
Slide 20: Quicken 1st half 2007 Highlights
For personal use only Quicken 1st half 2007 Highlights • Successful launch of 2007/08 Vista ready products – QuickBooks, Quicken, POS • Development of QuickBooks 2008 on schedule • Elite, Reckon NZ, Shelco trading well • Top Australian Software Awards won in QuickBooks, POS, Personal & Payroll categ
Slide 21: Quicken 2007 Second Half
For personal use only Quicken 2007 Second Half Complete QuickBooks 2008 beta program • Re-engineered to use SQL Database • Improved scalability • Broader market Reach • Better customer retention • Significant new product features • Improved user interface Leverage new acquisitions • Internet based a
Slide 22: Foundation for Future Growth
For personal use only Foundation for Future Growth • Organic growth continues • A good start to the second half show positive signs for a repeat strong second half performance • Benefits from 1st half revenue growth will follow in subsequent periods • 2007 acquisitions will contribute to profit grow
Slide 23: Questions? Thank You.
For personal use only Questions? Thank You. 23