Eckoh — FY2022 Earnings Presentation
25 slides from Eckoh's earnings presentation, Jun 15, 2022
Slide 1: Engage. Secure. Protect.
00 Engage. Secure. Protect. Eckoh results for the year ended March 31st 2022
Slide 2: Agenda
Preliminary results – year ended 31.03.22 00 2 Agenda. Results overview and 1 strategic view 2 Financial highlights Operations review 3 US operation UK operation Cloud Engagement 4 Security Solution 5 Summary
Slide 3: Highlights
Preliminary results – year ended 31.03.22 Results Highlights 00 3 Highlights. q Strong trading performance q Strong ARR1 growth driven primarily by our clients’ need to protect data q Transformational Syntec acquisition performing in line with our expectations q Unification and enhancement of securi
Slide 4: Syntec Strategic Rationale
Preliminary results – year ended 31.03.22 Syntec Rationale 00 4 Syntec Strategic Rationale. q Consolidates market leading position in contact centre payment security § Enhances Eckoh’s position as the largest provider in the key US market q Complementary operations § Proven, successful UK business w
Slide 5: Why Eckoh?
Preliminary results – year ended 31.03.22 Growth Drivers 00 5 New growth drivers in a broadening global market. Improving Engagement Reducing Fraud Maximising Cost Benefit Regulatory Compliance Digital Adoption Managing Financial and Transition to Cloud Reputational Risk Customer Engagement Security
Slide 6: Strategic Goals
Preliminary results – year ended 31.03.22 Strategic Goals 00 6 Strategic Goals. q Being the market leader for Customer Engagement data and payment security q Capitalise on structural developments in the global market for technology solutions that help protect customer data q Maximise client value an
Slide 7: Financial Highlights FY22
Preliminary results – year ended 31.03.22 Financial Highlights 7 00 Financial Highlights FY22. Revenue Operating profit 2 Total Business 3 £31.8m £5.2m £22.5m 4% 6% 1 1 10% 27% (FY21: £30.5m) (FY21: £4.7m) (FY21: £30.7m) Group ARR 4 US SecPay ARR 4 Net Cash £25.2m $11.9m £2.8m 48% +£8.2m 82% +$5.4m
Slide 8: Summary Financials
Preliminary results – year ended 31.03.22 Financial Highlights 00 1 Summary Financials. £M FY Mar 22 FY Mar 21 Variance Revenue 31.8 30.5 +4% Gross profit 25.4 24.2 +5% Gross profit margin (%) 80% 80% - Adjusted1 EBITDA 6.8 6.4 +7% Adjusted2 operating profit 5.2 4.7 10% Profit before tax 2.3 3.5 (34
Slide 9: Adjusted Operating Profit and Revenue Bridge
Preliminary results – year ended 31.03.22 Financial Highlights 00 9 Adjusted Operating Profit and Revenue Bridge. Revenue (£m) q Total revenue & adjusted operating profit - 35.0 Revenue (£m) increased year on year despite the tough 0.4 1.7 comparators with third-party support 30.0 0.8 1.0 0.5 0.8 1.
Slide 10: Group ARR and Contracted Business
Preliminary results – year ended 31.03.22 Financial Highlights 00 10 Group ARR and Contracted Business. Contracted business (£m) q Group ARR1 increased by 48% to £25.2m from £17.0m q Total contracted business2 £22.5m compared to £35 £30 £30.7m in FY21 reflecting an unusually quiet fourth £25 15 quar
Slide 11: Divisional Trading Analysis
Preliminary results – year ended 31.03.22 Financial Highlights 00 11 Divisional Trading Analysis. FY22 (Revenue £m) q US revenue accounts for 39% of FY21 Group revenue. Strategic goal ROW 0.5 2% remains US growth UK 18.9 UK 17.8 US 12.4 59% US 12.3 59% q UK continues to strengthen, with 39% 40% seco
Slide 12: US Trading Analysis
Preliminary results – year ended 31.03.22 Financial Highlights 00 12 US Trading Analysis. Revenue by Activity Y-o-Y ($m) q Secure Payments 89% of US revenues. Revenue 13.8 12.8 up 8% to $13.8m (FY21: $12.8m) $14.00 $12.00 q Secure Payments recurring revenue increased $10.00 $8.00 to 65% (FY21: 52%)
Slide 13: UK Trading Analysis
Preliminary results – year ended 31.03.22 Financial Highlights 00 13 UK Trading Analysis. q Revenue up 3% to £18.6m (FY21: £18.0m), when adjusting Revenue Split by Product each year for the discontinued Support activity revenue up 9.2% FY21 q Transactional volumes improved through the first half; 37
Slide 14: Syntec Trading Analysis (3 months only)
Preliminary results – year ended 31.03.22 Financial Highlights 00 14 Syntec Trading Analysis (3 months only). q Revenue of £1.7m in line with the acquisition analysis q CardEasy ARR3 £4.1m q Total contracted business1 £2.0m q New contracted business 2 £1.1m q Gross profit margin 80% Revenue Split by
Slide 15: Cloud Engagement Security Offering
Preliminary results – year ended 31.03.22 Cloud Offering 00 15 Cloud Engagement Security Offering. Verification & Fraud Prevention Call Real Time Recording Voice & Data Transcription Redaction and AI Reporting Advanced DataGuard and Speech Analytics Digital Secure Payments Chat Voice Security The Ec
Slide 16: US Secure Payments – Recurring revenue momentum
Preliminary results – year ended 31.03.22 Operations Overview 00 16 US Secure Payments – Recurring revenue momentum. q Completed exit from Support activity and transition to Secure US - Secure Payments ARR ($m) Payments which has delivered 30% CAGR over 5 years 14.0 q ARR1 increased $5.4m to $11.9m,
Slide 17: UK Overview – Activity returns to pre-pandemic levels
Preliminary results – year ended 31.03.22 Operations Overview 00 17 UK Overview – Activity returns to pre-pandemic levels. q Revenue excluding the impact of the exit from third-party support increased by 9%. This was driven by new business going live and improved volumes for our existing clients par
Slide 18: Summary and Outlook
Preliminary results – year ended 31.03.22 Summary and Outlook 00 18 Summary and Outlook. q Strong trading performance and ARR growth q Continued progress in US, with UK returning to growth q Transformational acquisition of Syntec completed q New unified go-to-market proposition of Customer Engagemen
Slide 19: Investment Case
Preliminary results – year ended 31.03.22 Investment Case 00 19 Investment Case. q Long term growth drivers § Significant market opportunity – still largely an untapped market § Patented IP and limited competitive threat – no homegrown US competitor § Macro factors - ongoing data breaches, increased
Slide 20: Thank you
Preliminary results – year ended 31.03.22 00 20 Thank you. Nik Philpot CEO DD: +44 1442 458358 nik.philpot@eckoh.com Chrissie Herbert CFO DD: +44 1442 458329 chrissie.herbert@eckoh.com
Slide 21: Appendix – History
Preliminary results – year ended 31.03.22 Appendix 00 21 Appendix 1 – History § Dec 1999 Float on FTSE as 365 Corporation § Jan 2002 Sale of internet business § May 2002 Change of name to Eckoh, new customer engagement strategy § Jun 2003 Eckoh moves to AIM § Jul 2006 Symphony share sold to Redstone
Slide 22: Appendix – Financial Information
Preliminary results – year ended 31.03.22 Financial Information 00 22 Appendix – Financial Information.
Slide 23: Commercial Model – Implications of shift to Cloud
Preliminary results – year ended 31.03.22 Financial Background 00 23 Commercial Model – Implications of shift to Cloud q Move to Cloud drives greater revenue visibility and earnings quality CLOUD/Hosted On premise (US & UK) solution (US) q More than 50% of US Secure Payments contract value in FY21 f
Slide 24: Appendix – Balance Sheet 31 March 2022
Preliminary results – year ended 31.03.22 Financial Highlights 00 24 Appendix – Balance Sheet 31 March 2022 31 Mar 31 Mar £’000 2022 2021 Intangible Fixed Assets 39,664 6,527 Acquisition of Syntec Mainly comprised of HQ building and hosted telephony Tangible Fixed Assets 4,189 4,307 platform Leased
Slide 25: Appendix – Cashflow Statement
Preliminary results – year ended 31.03.22 Financial Highlights 00 25 Appendix – Cashflow Statement £’000 31 Mar 2022 31 Mar 2021 Profit after tax 1,575 2,794 Depreciation / Amortisation 2,318 2,270 Share based payments 241 303 Taxation 743 717 Other (27) 561 Operating profit before changes in workin