Slide 1: Senetas Corporation Limited 2019 Interim Results
Senetas Corporation Limited 2019 Interim Results – 26 February 2019 © 2019 Senetas Corporation Slide 1
Slide 2: HY19 Highlights
HY19 HIGHLIGHTS • Revenue of $9.86m – in line with guidance • Slight decline in ANZ revenue, with Gemalto revenues consistent with the prior period • Maintenance revenue at 36% of total, reflecting lower price of ethernet products • First time impact of new AASB15 (revenue recognition) has reduced r
Slide 3: Sales Outlook Improving
SALES OUTLOOK IMPROVING 100Gbps Encryptors Ongoing sales Votiro pipeline Gemalto signed momentum with growing agreement to growing sales adopt SureDrop pipeline Initial pilots underway © 2019 Senetas Corporation Slide 3
Slide 4: R&D at the Core of Value Creation
R&D AT THE CORE OF VALUE CREATION Hardware Virtual (Software) European Encryption Solutions Encryption Solutions certification Additional New hardware Progress European capabilities to encryptors with certification for core conform with public transport layer hardware products cloud environments ind
Slide 5: Key Financials
KEY FINANCIALS © 2019 Senetas Corporation Slide 5
Slide 6: HY19 Key Financials
HY19 KEY FINANCIALS HY19 HY19 HY18 Half year ended 31 December 2018 ($000’s) Post AASB15 Pre AASB15 Pre AASB15 Revenue from ordinary activities 9,862 10,123 10,301 Gross profit 7,494 7,756 8,190 Gross Margin % 76% 77% 79% Other income 303 303 215 Profit before tax from ordinary activities 1,417 1,67
Slide 7: Effect of AASB15
EFFECT OF AASB15 • AASB15 applied to Senetas’s results for the first time in the period beginning HY19 • This requires the company to estimate and recognise the revenue expected to be earned from customer contracts, rather than waiting for the actual end sale before recognising the revenue • The pra
Slide 8: Strong Balance Sheet with No Debt
STRONG BALANCE SHEET WITH NO DEBT NET ASSETS $’000 CASH AND CASH EQUIVALENTS $’000 23,552 23,258 21,483 18,981 20,848 18,526 20,091 15,902 13,093 12,250 FY15 FY16 FY17 FY18 HY19 FY15 FY16 FY17 FY18 HY19 © 2019 Senetas Corporation Slide 8
Slide 9: Operational Update
OPERATIONAL UPDATE © 2019 Senetas Corporation Slide 9
Slide 10: Leverage Experience to Bring Best of Breed Security
LEVERAGE EXPERIENCE TO BRING BEST OF BREED SECURITY Networking tools Other Security tools Encrypted Hardware Software Content Disarm & File Sharing & Encryption Encryption Reconstruction Synchronisation Solutions Solutions Solutions Tool Layers 2, 3 & 4 Layers 2, 3 & 4 SureDrop Votiro Encryption pro
Slide 11: Building a Leader in Security Products
BUILDING A LEADER IN SECURITY PRODUCTS Our goal - diversify product revenues, increase growth, expand addressable market 3 Growth through investments and acquisition • Focus on revenue growth – leverage Focus on security while distribution and technical capabilities retaining user experience • Votir
Slide 12: 100Gbps Encryptors Gaining Traction
100GBPS ENCRYPTORS GAINING TRACTION • Higher sales of 100Gbps encryptors (Series SENETAS’S 100GBPS REVENUE CN9000) in HY2019 • Reflects customer transition to higher $1.1M speed networks • Sales driven by customers who have not previously purchased Senetas encryptors • Current sales margins reflect
Slide 13: Votiro Update
VOTIRO UPDATE • Expands Senetas’s product portfolio into Content Disarm and Reconstruction (CDR) technology – a significant opportunity across multiple end user markets • Senetas has committed to invest up to US$8m in Votiro resulting in a majority shareholding with pre-emptive right on further fund
Slide 14: Votiro Update
VOTIRO UPDATE • Primary focus is to accelerate Votiro’s growth via expanded distribution outside its core market of Japan − Senetas investment has provided the resources to make the required investments in additional business capability − Gemalto distribution opportunities currently being pursued −
Slide 15: SureDrop Update
SUREDROP UPDATE • SureDrop has undergone successful customer testing during HY19 with positive customer feedback • Signed an agreement with Gemalto in relation to the distribution of SureDrop and sales leads off the back of that agreement have already been encouraging. • The SureDrop technology was
Slide 16: Detailed Financials
DETAILED FINANCIALS © 2019 Senetas Corporation Slide 16
Slide 17: Trading Revenues (#039;000)
TRADING REVENUES ($’000) United States Australia and New Zealand • Good growth in European market, softer ANZ revenue Europe 15,907 17,591 18,920 • Total revenue in line with prior period 10,950 10,123* 64% Product sales revenue FY15 FY16 FY17 FY18 HY19 * Pre application of new AASB15 © 2019 Senetas
Slide 18: Operating Cash Flows
OPERATING CASH FLOWS Half year ended 31 December 2018 HY19 $000’s HY18 $000’s Change Receipts from customers 8,550 9,107 (6%) Tax paid (487) - - Payments to suppliers & employees (8,519) (7,777) 10% Operating cash flows (206) 1,536 - Investing cash flows (6,804) (1,066) 638% Advance payment to divid
Slide 19: Balance Sheet Remains Strong
BALANCE SHEET REMAINS STRONG Half year ended 31 December 2018 HY19 $000’s FY18 $000’s* Change Cash and cash equivalents 12,250 23,258 (47%) Trade and other receivables 5,678 6,529 (13%) Unlisted equity investments - 1,893 - Investment in Votiro 6,045 - - Total assets 33,144 35,968 (8%) Trade and oth
Slide 20: Impairment to Unlisted Investments
IMPAIRMENT TO UNLISTED INVESTMENTS • Senetas announced on 16 January 2019 that it expected to recognise an impairment to the carrying value of its investment in Smart Antenna Technologies Ltd (SAT) • Senetas holds a 5.52% interest that was initially acquired in Dec 2016 • The major shareholder and p
Slide 21: Disclaimer
DISCLAIMER This presentation ("Presentation") has been prepared by Senetas Corporation Limited (“Senetas“ or “the Company”) for the sole purpose of providing general and background information on the Company. Nothing contained in this Presentation is or should be relied upon as a representation as t