Slide 1: Final Results FY22
Final Results FY22 Tommy Cook, CEO Ashleigh Greenan, CFO
Slide 2: Test solutions for the world’s telecoms and cloud computing industries
Our portfolio enables R&D, pre-deployment and in-service testing Test solutions for the world’s telecoms and for network technologies and networked applications, enabling our cloud computing industries customers to validate the performance of the critical infrastructure associated with telecoms and
Slide 3: Focused on high value niches of the testing market
R&D Design Validation and Maintenance Testing post Focused on high value niches Conformance Testing deployment of the testing market ▪ Critical points in the development cycle, ▪ Deep insight is required to identify and require high capability and high-value test rectify complex maintenance issues e
Slide 4: Telecom equipment vendors, hyperscale, enterprise, network operators, component manufacturers
TELECOM EQUIPMENT VENDORS HYPERSCALE, ENTERPRISE NETWORK OPERATORS COMPONENT MANUFACTURERS Calnex May 2022 4
Slide 5: Review of the Year
——— Calnex Insight and Innovation Review of the Year
Slide 6: Another step forward for Calnex
£22.0m Revenue +23% Another step forward for Calnex £6.0m Considerable growth in revenue and profit before tax, ahead of the Board’s expectations £15.4m Adjusted PBT Continued high demand for our range of test and +18% measurement solutions Closing cash New product launches having been well received
Slide 7: Component shortages managed successfully
Component O-RAN Data Centre Delivered on shortages managed recommendations opportunities offer growth strategy successfully positive impact promising future through M&A Strong cooperation New customer groups Secured a significant order iTrinegy acquisition post- between CM (Kelvinside), within exist
Slide 8: Awarded two Queen’s Awards for Enterprise
Increased staffing levels across business development, Awarded two Queen’s Awards for Enterprise: sales, R&D and support roles, to support new product Innovation and International Trade, post-period end development and maximise exposure in new and existing territories New Vice President of Operation
Slide 9: Objective is to make a meaningful impact
Charity committee formed to identify opportunities in the local area. Objective is to Launched initiative to Social Responsibility fund - become an ISO14001 make a equal to 1% of the profits certified business by 2023. meaningful we generate. impact Invest in training to Committed to maintaining enh
Slide 10: Revenue Model and Financial Results
Revenue Model and Financial Results
Slide 11: Average length of relationship of top ten customers is 10 years
Hardware & Software revenue Warranty support Average length of relationship of top ten customers is 10 years 11
Slide 12: Revenue by geography
Revenue by geography £m Revenues to the Americas grew 23% 9.0 +31% Rest of the World experienced a 31% uplift in 8.0 +23% +14% revenues 7.0 6.0 North Asia grew by 14% after a flat first half due to 5.0 the ongoing geopolitical tensions between the US 4.0 and China 3.0 2.0 1.0 0.0 Americas ROW North
Slide 13: Income statement: revenue growth of 23%
Year ending 31 March FY22 FY21 £000 £000 ▪ Revenue growth of 23%. Revenue 22,046 17,978 Cost of sales (5,518) (4,013) ▪ Gross margin 75% for the period – within anticipated Gross Profit 16,528 13,965 range. Product and bundle mix will drive margin in a Other income 648 530 Administrative expenses (e
Slide 14: Cash flow and closing cash
Year ending 31 March FY22 FY21 £000 £000 ▪ £2.7m of cash generated in year (FY21: 5.4m before IPO Cashflows from operating activities funds), ahead of management expectations at start of EBITDA (continuing business) 9,259 6,554 FY22. Add back non cash items (542) 892 Discontinued operations - (201)
Slide 15: Strategy
— Calnex Insight and Innovation Strategy LTT’, WwW’
Slide 16: The telecoms industry is a highly competitive environment
The telecoms industry is Requiring innovative a highly competitive products, technologies The global market for telecoms test and measurement environment. and services to support equipment in 2020 for mobile networks alone estimated to be investment in new digital infrastructure. around US$1.3 billi
Slide 17: Synchronization testing and network emulation products
Synchronization Testing synchronization Network emulation for real-world testing testing in the lab performance of networks in the lab LAB SYNC NETWORK SYNC CLOUD & IT Telecom Telecom Data Centre Infrastructure Applications Paragon-neo Attero-100G Sentinel Sentry Paragon-X SNE NE-ONE • Sustained pos
Slide 18: The only full-coverage network emulation portfolio
The ONLY full-coverage APPLICATIONS Network Emulation portfolio Internet Apps (incl. gaming), Enterprise IT Migration Applications 1 NETWORKS Telco Cloud, MEC, Midhaul Application- Application-optimised optimised SW HW 2 Infrastructure PRECISION SYSTEMS Performance-optimised Performance-optimised Fu
Slide 19: Three-pillared growth strategy
Three-pillared growth strategy to capitalise on the structural market growth drivers Continued product Expand within the Cloud Target select M&A innovation to capitalise on Computing sector and other opportunities and strategic growth of 5G Ethernet market niches partnership opportunities Follow-thr
Slide 20: Outlook and investment case
▪ Invested in the team and resources to enable ability to scale Established Proven business ▪ Continued positive response to the new product industry position model provides a launches provides optimism with regards to the long- with reputation strong platform term demand for winning for sustainable
Slide 21: Appendix
— Calnex Insight and Innovation Appendix LTT’, WwW’
Slide 22: Management and Board
Tommy Cook Ashleigh Greenan George Elliott Ann Budge GraemeBissett Margaret Rice-Jones Stephen Davidson CEO CFO Non-Exec Chair Non-Exec Non-Exec Non-Exec Non-Exec Director Director Director Director Tommy is the founder and Ashleigh qualified as a George has been Chair of Ann has been a non- Graeme
Slide 23: Balance sheet
Mar-22 Mar-21 £000 £000 Non-current assets Intangibles assets 8,424 7,525 Property, plant & equipment 274 22 Right of use assets 791 522 Deferred tax asset 304 613 9,793 8,682 Current assets Inventories 998 1,111 Trade and other receivables 4,997 1,819 Cash, including fixed term investment 15,357 12
Slide 24: Major Shareholders
▪ Share Price 171p (at 20.05.2022) Major Shareholders ▪ Market AIM % of Issued Share Shareholder Capital ▪ Ticker CLX Thomas (Tommy) Cook (CEO) 21.0% ▪ Market Cap. £149m BGF Investment Management Limited 11.85% ▪ Ord. shares in issue 87.5m Scottish Enterprise 9.0% Close Brothers Asset Management 8.5
Slide 25: Maintaining accurate time with Facebook/Meta datacentres
Maintaining accurate time with Facebook/Meta datacentres ▪ Top 10 customer since FY20. ▪ Facebook produces some of the most popular websites and apps in the world. Facebook technologies empower over a billion people around the globe and a crucial enabler for this is their network of data centers. Se
Slide 26: O-RAN brings new players into the market
▪ A tier 1 Server manufacturer placed orders of circa. £1M during the last O-RAN brings new players into the market 18 months. ▪ A new customer to Calnex in FY21, likely to be a top 10 customer for FY22 ▪ Purchasing for lab test equipment to verify implementation of O-RAN functionality into their pr
Slide 27: Revenue and cost model
• Two revenue streams: Revenue • 90% bundled hardware & software recognised on delivery • 10% warranty and software support recognised over life of product Gross Gross margin: approx. 75% net of discounts given to channel partners Cost of sales: approx. 85% is cost of billing from Kelvinside; remain
Slide 28: Lean business model with global distribution channels
Lean business model, with global distribution channels in place and manufacturing outsourced to a high quality local partner Distribution channels Manufacturing capability Operational excellence Global reach through network of regional Manufacturing outsourced to Kelvinside Young business but experi