Slide 1: Redcentric - Agile, Available, Assured
i) redcentric EO) AGILE * AVAILABLE * ASSURED
Slide 2: Agenda
Agenda Introductions Market overview Financial review Summary & outlook redcentric 2
Slide 3: Operational review
PUBLIC Operational review Peter Brotherton — Chief Executive Officer redcentric AGILE * AVAILABLE » ASSURED
Slide 4: Trading backdrop and underlying performance
Trading backdrop and underlying performance Revenue - Recurring 76.6 80.9 83.0 - Non recurring 99 95 10.3 Total revenue 86.5 90.4 93.3 Recurring Revenue% 88.5% 89.5% 89.0% Adjusted EBITDA 19.9 23.9 23.7 ‘Adjusted EBITDA margin% 23.0% 26.4% 25.4% Capital expenditure ("Capex") 64 G5) ) Adjusted EBITDA
Slide 5: Operational highlights
Operational highlights significant year f with two capability acquisitions completed i ar and a further three acquisitions completed post year end. * — Acquisitions have significantly enhanced our product and service offering, whilst adding transformational scale to the Group. * — Anew divisional st
Slide 6: Cloud, Network and Collaboration services
Cloud Services Cloud offering significantly strengthened through acquisitions. Solutions range from colocation to hybrid and public cloud services. IT modernisation, digital transformation, and Dev-Ops skills complete Cloud Services portfolio. FY22 recurring revenue contribution 35% New divisional f
Slide 7: Finance facility update
Finance facility update Newly secured finance facility to support Redcentric in its next phase of growth In Apr-22, Redcentric completed and significantly increased the New four bank syndicate refinancing of its Group debt facilities to support the growth strategy, including acquisition activity. Th
Slide 8: Growth strategy
Growth strategy A robust growth strategy targeting £150m of revenue within the next two years (a material uplift on FY21) with EBITDA margins returning towards 25% + The five acquisitions completed since Sep-21 have * Acquisitions for both capability and scale. significantly enhanced our solutions p
Slide 9: Acquisition strategy update
PUBLIC Acquisition strategy update Peter Brotherton — Chief Executive Officer redcentric AGILE * AVAILABLE » ASSURED
Slide 10: Progress against acquisition strategy
e Progress against acquisition strategy Significantly enhanced service capability Transformational scale acquisitions During FY22, two capability acquisitions (Piksel and 7 Elements) were completed. A further capability acquisition was completed in Jun-22, with the acquisition of consulting and AWS
Slide 11: Long term impact of recent acquisitions
Long term impact of recent acquisitions Highly accretive acquisitions, secured at competitive valuations, provides the Group with the platform to target revenues of £150m within the next two years and EBITDA Margins of c.25% FY21A (Illustrative) — (Illusti Acquired entity Piksel Industry Solutions 9
Slide 12: Acquisition of Sungard DCs
Acquisition of Sungard DCs The Sungard DC business is renowned for its highly resilient data centre estate and assured IT recovery services. The business hosts and manages mission critical infrastructure for a strong blue-chip enterprise customer base from its three data centres in Hounslow, Elland,
Slide 13: Acquisition of Piksel Industry Solutions
Acquisition of Piksel Industry Solutions (“Piksel”) Enhancing cloud capability Extensive public cloud experience across AWS and Microsoft Azure Transformed cloud offering with complete end-to-end digital transformation capability enabling a customer's journey from colocation to hyperscale cloud Comp
Slide 14: Acquisition of Elements (7E)
Acquisition of 7 Elements ("7E”) New security capability Leading provider of security testing, incident response management, managed vulnerability scanning, and bespoke consultancy services Robust customer base Long standing customer base with a high proportion of repeat spend Providing security sol
Slide 15: Integration update
Integration update d robust operating platform ing synergy maximisati e Near term focus on the integration of the most recent acquisitions (Sungard and 4D) to maximise synergy potential and create a streamlined platform for further acquisitions and future growth. e = Sungard DC was loss making on ac
Slide 16: Market overview
PUBLIC Market overview David Senior — Chief Financial Officer redcentric AGILE * AVAILABLE » ASSURED
Slide 17: Revenue mix by service
Collaboration Collaboration 8% Security & 14% Services Cloud Cloud Security & 9% 24% 52% Services 8% Connectivity 32% Connectivity 54% 17
Slide 18: High growth market opportunity
High growth market opportunity Transformed cloud and security capability provides access to high-growth segments of the market UK IT services market growing at 7% CAGR Total UK IT services market is expected to be valued at £183bn by 2025 (estimated £146bn in 2022). There are several areas that are
Slide 19: Our response to market drivers
Our response to market drivers Outlook remains positive, despite ongoing headwinds, supported by robust market dynamics and a compelling service offering Digital transformation accelerated by COVID-19 Newly created Cloud Services division with transformed capability Complete end-to-end digital trans
Slide 20: Financial review
PUBLIC Financial review David Senior — Chief Financial Officer redcentric AGILE * AVAILABLE » ASSURED
Slide 21: Financial performance — revenue and profitability
Financial performance — revenue and profitability ess Capex £23.7m (-1%) Adjusted EBITDA margin of 25% (FY21: 26%) Increased operating costs offset additional contribution from £35.8m (+8%) Operating cost increase largely reflects additional costs associated with acquired businesses and increased en
Slide 22: Financial performance — liquidity & earnings
£12m £10m £8m fom £4m £2m £0m £15.4m (- £5.9m reduction on prior year largely reflects a reversal of FY21 positive working capital movements. Normalised net debt movement 28%) Financial performance — liquidity & earnings Mer se ershare movement per share £16.6m (+ Increase of £1.1m reflecting strong
Slide 23: Group income statement
Group income statement Revenue 93.3 49.0 44.3 91.4 2% Cost of sales (33.8) (17.1) (167) (33.5) 1% Gross Profit 59.5 319 21.6 57.9 3% Gross Margin 63.8% 65.1% 62.4% 63.4% Operating Costs (35.8) (20.0) (15.8) (33.4) 1% Adjusted EBITDA 23.7 11.8 19 24.6 A% EBITDA Margin 25.4% 24.2% 26.8% 26.9% Depecato
Slide 24: Adjusted net debt
Adjusted net debt + During the year, net debt increased by £1.1m to £16.6m reflecting: - Operating cash flows of £19.3m (82% operating cash conversion); - The net cash impact of the acquisition of Piksel and 7 Elements in the period of £10.4m; Adjusted EBITDA Working Capital movements Transfer from
Slide 25: Balance sheet
Balance sheet Strong balance sheet maintained Net debt analysis * The net asset position is broadly in line with the prior period. + Adjusted net debt of £1.5m as at 31 March 2022 (FY21: net cash of £1.0m) + The increase in intangible assets reflects the acquired intangible assets and + The net debt
Slide 26: Dividend policy and share buyback
Dividend policy and share buyback + A final dividend of 2.4p per share is recommended The following dates are proposed: by the Board, resulting in total dividend for FY22 of 3.6p per share (FY21: 3.6p per share). Ex-dividend date 28 July 2022 * Returns to shareholders totalled £8.6m in the year refl
Slide 27: Summary & outlook
PUBLIC Summary & outlook Peter Brotherton — Chief Executive Officer redcentric AGILE * AVAILABLE » ASSURED
Slide 28: Summary and outlook
Summary and outlook Summary The business continues to perform well and is trading significantly ahead of pre COVID-19 levels. We have faced ongoing headwinds in the period which have impacted trading, but sales orders and large-scale IT projects started to return towards the end of the period. We co
Slide 29: Financial guidance and trends
Data centre & network review Potential DC rationalisation opportunity following recent acquisitions IFRS 16 Right of use asset depreciation and associated interest expected to increase materially due to addition of 4D and Sungard data centres Financial guidance and trends Capital expenditure Custome
Slide 30: Company overview & investment highlights
PUBLIC Company overview & investment highlights redcentric AGILE * AVAILABLE » ASSURED
Slide 31: Redcentric at a glance
Redcentric at a glance Redcentric is a leading IT managed services provider delivering highly available connectivity, cloud and collaboration solutions that help public and private sector organisations succeed Formed in 2013 when Redstone reversed into InTechnology Plc The Group is comprised of 7 hi
Slide 32: Transforming and managing your mission critical IT infrastructure
Transforming and managing your mission critical IT infrastructure KEEPING 20,000 CUSTOMER SITES CONNECTED HREKEKEKRAHKE KEK users to communicate & collaborate ©®O© 6086060806080 PROVIDING ASSURANCE TO 100S OF ORGANISATIONS NHS DIGITAL PARTNER 4 © hosting national Ae CRITICAL INFRASTRUCTURE ©80008000
Slide 33: Our enhanced service portfolio
Our enhanced service portfolio fay (#) Cloud Digital transformation consultancy Disaster recovery (::) Connectivity SD-WAN HSCN connectivity Managed WAN Public cloud connectivity Ur Managed LAN (Azure & AWS) Tomi ieee Managed wireless networking 5 7 ne Modern workplace Colocation Virtual desktops Ma
Slide 34: The investment proposition
Growing market driven by the move towards off- premise solutions and mobile access to secure services Digital transformation accelerated by COVID-19 A highly fragmented market undergoing consolidation with ample acquisition opportunities Diverse customer base Growing public sector presence Strong He
Slide 35: Investment highlights
Stable performance Performance in line with Board expectations and significantly ahead of pre COVID-19 levels Revenue of £93.3m Gross profit of £59.6m Adjusted EBITDA of £23.7m Inorganic growth momentum Successfully completed 5 acquisitions between Sep-21 and Jul-22 Integration well underway Firepow
Slide 36: Customer sectors
• • • • • • Healthcare Public Sector Healthcare Local Authority Other Public Sector Manufacturing Service Provider Retail I.T & Telecoms Charities Legal Leisure Recruitment Construction Media Property Insurance Housing Associations Education Financial Services Accountants Other 36
Slide 37: Our responsibility
Our responsibility We are committed to being a socially, economically, and environmentally responsible business. This is reflected in our actions and our corporate policies. * Continuously evolving our national corporate social responsibility strategy Environmental, Social and Governance (ESG) to su
Slide 38: Thank you
PUBLIC Thank you redcentric AGILE * AVAILABLE » ASSURED