Energy One Limited · ASX:EOL
Energy One — Investor Presentation (February 2019)
28 slides from Energy One's investor presentation, Feb 26, 2019
Slide 1: Energy One Limited (ASX:EOL) Investor presentation 1H19
Energy One Limited (ASX:EOL) Investor presentation 1H19 1
Slide 2: Disclaimer
Disclaimer This document has been prepared by Energy One Limited (EOL) and comprises written materials and slides for a presentation concerning EOL. This presentation is for information purposes only and does not constitute or form part of any offer or invitation to acquire, sell or otherwise dispos
Slide 3: Contents
Contents Financials 1H19 4 Contigo Software acquisition 8 3
Slide 4: 10th consecutive half of profitable growth
10th consecutive half of profitable growth Key financial metrics vs. previous corresponding period include: $6.02M Revenue, up 20% $1.60M* EBITDA, up 20% $1.09M* NPBT, up 15% During the first half we also acquired Contigo Software (UK) Limited. *The figures above include one month’s contribution fro
Slide 5: Profit & loss statement
Profit & loss statement $’000 FY2016 FY2017 FY2018 1H19 Commentary Revenue 4,583 5,429 9,299 5,762 20% increase on H1 FY18 Other revenue 584 688 628 253 Direct project costs (43) (59) (257) (215) Employee benefits expense (2,674) (3,065) (4,964) (2,953) Rental expense (193) (215) (263) (164) Consult
Slide 6: EBITDA continues to grow
EBITDA continues to grow * * Before one-off acquisition costs relating to Contigo acquisition 6
Slide 7: Balance sheet
Balance sheet $’000 FY2016 FY2017 FY2018 1H19 Cash and cash equivalents 2,228 363 728 2,325 Strong end to H1, even with major acquisition Trade and other receivables 2,056 2,867 1,829 4,908 Increase due to acquisition (busy install period) Total Current Assets 4,108 3,457 2,733 7,603 Plant and equip
Slide 8: Energy One successfully acquires
Energy One successfully acquires On 30 November 2018, EOL executed an agreement to acquire of 100% of shares in Contigo Software Limited. Contigo is a leading supplier of ETRM software in the U.K and EU. The Contigo acquisition is immediately earnings accretive and was fully funded using a com
Slide 9: Key features of the acquisition
Key features of the acquisition • Strong position in the U.K and EU with 20% - 25% of the UK ETRM market. • Stable industry servicing blue chip corporates. • 63% recurring revenue. • Diverse international customer base • Robust proven SaaS software. • Strong, experienced team. • Physical presence wi
Slide 10: Contigo is a leading, high quality, business spun out of a major corporate
Contigo is a leading, high quality, business that has been spun out of a major corporate Contigo was previously a subsidiary of a global vendor of exchange trading platforms. Energy One identified the Contigo business as an ideal potential acquisition target and completed the acquisition during late
Slide 11: A pivotal strategic acquisition expanding our market offshore
A pivotal strategic acquisition expanding our market offshore With a dominant position in the energy ETRM space in Australia, an off shore market like the U.K. and Europe provides an exciting expansion opportunity. The market size in UK/EU is >10x the size of the Australian market. 11
Slide 12: Customers and EOL to benefit from economies of scale
Customers and EOL to benefit from economies of scale Can now develop a ‘follow the sun’ global 24hr support service. Sales teams will have a greater range of features or products to sell to new and existing clients (cross- sell, upsell) A global development team will have greater depth and more reso
Slide 13: A strong customer base
A strong customer base c entrica NETZE BES # @ ©) Utilities =< @SSE SB crew Invenergy nature energy energyone
Slide 14: With diverse types of customers…
With diverse types of customers… Type of customer 14
Slide 15: …and a strong position in the UK
…and a strong position in the UK Contigo customers by geography 15
Slide 16: Contigo’s key products…
Contigo’s 3 key products… An an award-winning ETRM system, similar in purpose to our EOT and SimEnergy products but built for the UK/EU market An integrated energy nomination and scheduling platform, similar to our EnergyOffer platform, tailored for that local market Retail pricing engine – allowing
Slide 17: The software is modern, robust and proven…
The software is modern, robust and proven… Contgo’s software is modern, SaaS- based, feature rich and easy to install and configure. Contigo has a strong (award-winning) reputation for quality, delivery and reliability compared to other UK/EU vendors. 2017 Energy Risk Software rankings Winner #1 E
Slide 18: So it is well positioned for next wave of system upgrades
So it is well positioned for next wave of system upgrades. With modern, cloud based, software, Contigo is well positioned to replace legacy systems in the next round of software upgrades. Contigo recently signed two customers who were replacing what was once considered a market leading ETRM solu
Slide 19: Changing market trends in the U.K. and EU provide a tail wind
Changing market trends in the U.K. and EU provide a tail wind Many new entrants wanting simple SaaS solutions. Move to more within-day trading - our system is far better suited than legacy systems of competitors. Trend toward replacement of legacy systems due to market changes. 19
Slide 20: The acquisition of Contigo fits EOL’s long-term strategy
The acquisition of Contigo fits EOL’s long-term strategy Diversification Grow customer base Grow by acquisition ✓ ✓ ✓ Product diversification U.K. European market An almost identical Cross selling 10 times larger than business to Energy opportunities Australia One but in the U.K. 20
Slide 21: Acquisition builds revenue diversity
Acquisition builds revenue diversity • The combined business will have an installed base of 175 instances across 11 countries • Anticipated combined recurring revenues will be >70% • Opportunity to cross- sell/bundle/package offerings to existing customers • Greater leverage of future development in
Slide 22: Contigo is well placed to access Europe
Contigo is well placed to access Europe • Head office in Solihull, 7.5 miles southeast of Birmingham and 180km northwest of London. • Centrally located in UK • Local international airport • Easy access to the EU • Great opportunity to grow Contigo’s market share (currently ~25% in UK ETRM) vs. EOL’s
Slide 23: The acquisition is immediately earnings accretive
The acquisition is immediately earnings accretive • Contigo Software immediately adds positive EBITDA to EOL. • Funded using bank debt the acquisition will be immediately earnings accretive for shareholders. • Additional free cash flow being generated. • The acquisition will assist in reducing EOL’s
Slide 24: The combined company will have better scale
The combined company will have better scale Full year equivalent EOL1 Contigo2 Combined Installed customer base 130 45 175 Countries 4 7 11 Revenue $10.5M $8.5M $19M EBITDA $3.0M $1.25M $4.25M 1) EOL figures are H1 FY19 (before one-off acquisition costs), annualized and rounded up – for illustrative
Slide 25: Acquisition metrics
Acquisition metrics Metric EBITDA* (Contigo) £700,000 NPAT* £340,000 Acquisition of shares £715,000 Funding of Contigo shareholder loan £3,285,000 less Net working capital £800,000 Total £3,200,000 EBITDA multiple 4.5 NPAT multiple 9.4 *Estimate – Based on a standardized ‘full year’ performance. Exc
Slide 26: The acquisition was funded using bank debt and cash
The acquisition was funded using bank debt and cash • Westpac has provided an acquisition loan facility of $7.3m. • The three year floating rate loan is payable over five years. • Same terms as previous facility. 26
Slide 27: EOL software has an installed base of 175 and 1200+ users
EOL software has an installed base of 175 and 1200+ users, including: 27
Slide 28: Mr Shaun Ankers - CEO and Managing Director
Mr Shaun Ankers - CEO and Managing Director Email: enquiries@energyone.com.au Level 13, 77 Pacific Highway North Sydney NSW 2060 28