Xero Limited · ASX:XRO
Xero — Shareholder Meeting (August 2020)
28 slides from Xero's shareholder meeting presentation, Aug 13, 2020
Slide 1: Market Release: 2020 Annual Meeting - Presentation
For personal use only MARKET RELEASE 2020 Annual Meeting - Presentation WELLINGTON, 13 August 2020 - Please see the attached Annual Meeting Presentation, which includes a COVID-19 subscriber update from 1 April to 31 July 2020 which shows total subscribers increased by 96,000 over this period reach
Slide 2: Xero Annual Meeting 13 August 2020
Xero Limited For personal use only Annual Meeting 13 AUGUST 2020 From top: KLAS Business + Accounting | AU CV Ledger | US, Evansdale Cheese | NZ
Slide 3: Important notice
Important notice For personal use only This presentation is given on 13 August 2020 on behalf of Xero Limited (Xero) (ASX:XRO) (Company number NZ 183 0488, AU ARBN 160 661 183) Information in this presentation: - is for general information purposes only, and is not an offer or - includes statements
Slide 4: Board of Directors
Board of David Thodey, AO For personal use only CHAIR OF THE BOARD Directors INDEPENDENT NON-EXECUTIVE DIRECTOR People and Remuneration Committee Nominations Committee (Chair) Mark Cross Rod Drury INDEPENDENT NON-EXECUTIVE DIRECTOR XERO FOUNDER Audit and Risk Management Committee NON-EXECUTIVE DIREC
Slide 5: Agenda
Agenda 01 Chair’s 02 CEO For personal use only address update David Thodey Steve Vamos CHAIR OF THE BOARD CHIEF EXECUTIVE OFFICER 03 Financial overview 04 Resolutions 05 Q&A Kirsty Godfrey-Billy CHIEF FINANCIAL OFFICER 4
Slide 6: Using the online platform
Using the online platform Download the Online Portal Guide at For personal use only xero.com/about/investors Virtual Meeting HELP NUMBER Ask a Question Get a Voting Card Questions (+61) 1800 990 363 POWERED BY LINK MARKET SERVICES Ask a Question ? Ask a Question Voting Get a Voting Card Get a Voting
Slide 7: Chair's address
For personal use only Chair’s address David Thodey CHAIR OF THE BOARD Kaye Harding, Ecosystem & Simon Lofts, Marketing 6
Slide 8: CEO update
For personal use only CEO update Steve Vamos CHIEF EXECUTIVE OFFICER Iyanna Vaughn | US Partner 7
Slide 9: Working OK under COVID-19
Working Ok under For personal use only COVID-19 Supporting our Continuing to help Prioritised people and customers and product maintaining partners development productivity - Adapting to new ways - Targeted support on - Responding to changes of working topics such as in leave entitlements, wage subs
Slide 10: COVID-19 subscriber update
COVID-19 subscriber update For personal use only Operating conditions remain uncertain and we continue to anticipate an impact from COVID-19 on Xero’s FY21 results 96,000 2.38 m net subscriber total subscribers additions in the first as at 31 July 2020 four months of FY21 Gross subscriber Net subscr
Slide 11: Strategic trends
Strategic trends Adoption of cloud technologies For personal use only Digitisation of tax and compliance Innovation in financial services Post COVID-19 small business economy 10
Slide 12: Areas of planned strategic investment
Areas of planned strategic investment For personal use only STRATEGIC Grow small Build for global scale Drive cloud accounting PRIORITIES business platform and innovation Best-in-class cloud Small business needs Attract, inspire and accounting for small beyond accounting and retain world class busin
Slide 13: Social and environmental impact
Social and Fishermans Bay Conservation Project NEW ZEALAND environmental For personal use only impact V I R O N MEN EN T T Y & I NC S I L R US DIVE ION BUSINESS OUR P EO P L E S ITIE UN SU P M PO M RT C O 12
Slide 14: Financial overview
For personal use only Financial overview Kirsty Godfrey-Billy CHIEF FINANCIAL OFFICER Apparition Media | Australia 13
Slide 15: Continued global growth drives FY20 results
Continued global growth drives FY20 results For personal use only Financial performance highlights for the year ended 31 March 2020 SUBSCRIBERS ARPU AMRR TOTAL LIFETIME VALUE 2.285m $29.93 $820.6m $5.5b + 467,000 YOY + 2% YOY (-1% in + 29% YOY (25% in + $1.2b YOY constant currency) constant currency
Slide 16: Drive cloud accounting
Drive cloud accounting For personal use only FY20 Australia New Zealand United Kingdom North America Rest of World Subscribers 914k +26% 392k +12% 613k +32% 241k +24% 125k +51% Net additions 188k +31% 41k -18% 150k -1% 46k +5%1 42k +68% Revenue $320m +23% $116m +19% $184m +54% $55m +25% $43m +43% >5
Slide 17: Grow the small business platform
Grow the small business platform For personal use only FY20 revenue FY20 revenue growth YOY composition 82% Group operating revenue $718.2m 30% Group 33% operating 28% revenue 19% Core accounting growth 89% Platform revenues1 WorkflowMax2 Core Platform Non- 7% accounting revenues1 WorkflowMax2 recur
Slide 18: Unit economics and track record of value creation
Unit economics Value of a Xero subscriber at 31 March 2020 and track record For personal use only $2,500 $2,000 LTV/CAC of value creation $1,500 $1,000 5.8 LTV $2,422 $500 March 2020 Δ YOY CAC $0 $420 ARPU $29.93 $-500 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 MRR churn 1.13% Gross mar
Slide 19: Total available liquid resources of $686 million
Total available Movement in net cash position liquid resources For personal use only FY19 FY20 YOY of $686 million ($000s) ($000s) change ($000s) Cash and 121,527 108,027 (13,500) cash equivalents Positive free cash flow result in FY20 of $27.1m, equivalent to 3.8% of operating revenues Short-term d
Slide 20: Outlook
Outlook For personal use only The continuing uncertainty surrounding the COVID-19 environment means it remains speculative to comment further on the potential impact on our expected performance for FY21. Xero’s ambition is to be a long-term oriented, high-growth business. We continue to operate with
Slide 21: Resolutions
For personal use only Resolutions Alex Falcon | UK Partner 20
Slide 22: Fixing the remuneration of the auditor
RESOLUTION 1 For personal use only Fixing the remuneration of the auditor That the Board is authorised to fix the fees and expenses of Ernst & Young as auditor for the ensuing year For Against Discretionary 101,582,181 1,293,393 82,964* 98.66% 1.26% 0.08% * 32,135 of which are held by the Chair of t
Slide 23: Re-election of Lee Hatton as a director
RESOLUTION 2 For personal use only Re-election of Lee Hatton as a director That Lee Hatton, retiring from office as a director of Xero at the Meeting, and being eligible, be re-elected as a director of Xero For Against Discretionary 102,328,883 549,599 82,606* 99.39% 0.53% 0.08% * 31,777 of which ar
Slide 24: Re-election of Rod Drury as a director
RESOLUTION 3 For personal use only Re-election of Rod Drury as a director That Rod Drury, retiring from office as a director of Xero at the Meeting, and being eligible, be re-elected as a director of Xero For Against Discretionary 102,857,696 29,326 81,857* 99.89% 0.03% 0.08% * 31,028 of which are h
Slide 25: Election of Mark Cross as a director
RESOLUTION 4 For personal use only Election of Mark Cross as a director That Mark Cross, appointed by the Board as a director of Xero on 1 April 2020, and who will retire at the Meeting in accordance with clause 20.4 of Xero’s Constitution, and being eligible, be elected as a director of Xero For Ag
Slide 26: Q&A
For personal use only Q&A Moovaz | Singapore 25
Slide 27: Glossary
Glossary For personal use only Subscribers Constant currency Liquid resources Subscriber means each unique subscription to a Xero- Constant currency comparisons for revenue are based on Liquid resources comprises cash and cash equivalents, offered product that is purchased by an accounting average e
Slide 28: Beautiful business
For personal use only Beautiful business xero.com/investors