Iress Limited · ASX:IRE
Iress — CommSec 2007 Emerging Companies Conference
29 slides from Iress's conference presentation, Nov 14, 2007
Slide 1: CommSec 2007 Emerging Companies Conference
For personal use only CommSec 2007 Emerging Companies Conference November 2007
Slide 2: Segment Performance Against Prior Half
Segment Performance Against Prior Half For personal use only Information Services Operating Revenue up 7.9% (up 19.1% on PCP) EBITDA up 10.0% (up 19.1% on PCP) PAT up 8.7% (up 14.7% on PCP) Wealth Management Operating Revenue up 85.5% (up 248% on PCP) EBITDA up 141.2% (up 327% on PCP)
Slide 3: Strategic & Non-Recurring Items
For personal use only Strategic & Non-Recurring Items Strategic Charges ($4.602)m in total As with prior period we have continued with amortisation of purchased intangibles such as Computer Software The main changes in H1 2007 charges were: Full period charge for Computer Software recognised
Slide 4: IRESS Group – Overview
IRESS GROUP – Overview For personal use only Information Services Wealth Management IRESS Visiplan Australia & IOS, Australia & WebIRESS, Xplan Portfolio New Zealand New Zealand FTS PlanTech KTA Spotlight IRESS Canada Mkt Data, South Africa Xplan Trading IOS PlanTech
Slide 5: PCP change in Group Recurring Subscription Revenue
PCP change in Group Recurring For personal use only Subscription Revenue Acquisition of Visiplan business in April’07 9.0 8.0 Acquisition of PlanTech business 7.0 in Sept’06 6.0 5.0 Acquisition of $m Acquisition of 100% existing business as of Canada business 4.0 part of Cad JV in in April’06 April’
Slide 6: PCP change in Group EBITDA
For personal use only PCP change in Group EBITDA* Acquisition of Visiplan business in April 07 6.0 Acquisition of 5.0 PlanTech business in Sept’06 4.0 Acquisition of Acquisition of 100% existing business as of Canada business 3.0 part of Cad JV in in April’06 $m April’04 2.0 1.0 - H2'03 H1'04 H2'04
Slide 7: Information Services
For personal use only Information Services Î Half on half growth again replicates prior half Î Revenue growth across all products. Major contributors IRESS desktop, IOS & WebIRESS Î Competitors present at bottom end of market data and top end of order management. Impact very minor and at bottom end.
Slide 8: Info Services – Monthly Subscription Rev
Info Services – Monthly Subscription Rev For personal use only 6.0 5.5 5.0 $m 4.5 4.0 3.5 3.0 2.5 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07
Slide 9: Info Services – Margin Analysis
For personal use only Info Services – Margin Analysis % Revenue per Media Release H1 2005 H2 2005 H1 2006 H2 2006 H1 2007 Licence Fee Revenue 71.9% 71.7% 71.8% 72.0% 71.9% Other Rev (News / Roy. / Comms) 28.1% 28.3% 28.2% 28.0% 28.1% Total Direct Staff Costs (18.3%) (18.5%) (18.0%) (18.4%) (17.0%) T
Slide 10: Info Services
For personal use only Info Services Î Unprecedented ASX trading volumes handled smoothly Î Agreement with key online brokers to fully migrate all premium users to WebIRESS Î AXE ECN & Liquidnet compatible versions of IRESS, IOS released Î ASX CFD’s and FX capability added. CFD’s now live Î Further r
Slide 11: Australian Market Interface (AMI)
Australian Market Interface (AMI) For personal use only Î Single system connecting to ASX, ECN and any new venue Î Initiative based around IOS+, FIX+ and existing strategy engine White paper generating strong interest, key client implementing Automated two-way bridge between existing IOS network
Slide 12: IRESS Portfolio System (IPS)
For personal use only IRESS Portfolio System (IPS) Î IPS a critical integration component between equities market and wealth management divisions. Tax based reporting Equities, options, funds, futures, debt, hybrids Corporate action processing (current and historical) Managed accounts (IMA /
Slide 13: Wealth Management
For personal use only Wealth Management Î IRESS becomes the leading independent provider of Wealth Management software in Australia, New Zealand and South Africa VisiPlan acquisition (April 07) doubled the Wealth Management revenue base Spotlight (RSA) acquisition (July 07) provides scale and gr
Slide 14: Wealth Management Acquisitions
For personal use only Wealth Management Acquisitions Î VisiPlan Î Spotlight (RSA) Strong recurring revenue Strong established strategic base position Synergies in back-office, Skilled & highly regarded development efficiencies, local management and data management Strong recurring revenue
Slide 15: Wealth Management – Business Overview
Wealth Management – Business Overview For personal use only Revenue (AUD) Xplan Australia & Plantech 34.3m (pa) est. New Zealand Visiplan Spotlight South Africa 5.7m (pa) est. Plantech Estimates based on current run rate
Slide 16: Wealth Management Initiatives – AUS & NZ
Wealth Management Initiatives – AUS & NZ For personal use only Î AppCentral “STP” for insurance applications Multi-applications Launched with Zurich and further support Î CommPay Dealer payment and reporting system Integration is key differentiator Trialling by some clients, significant
Slide 17: Wealth Management Initiatives – AUS & NZ (Cont'd)
Wealth Management Initiatives – AUS & For personal use only NZ (Cont’d) Î Debt Analysis Tools Qualifier E-app Î IPS Expansion of feeds, modelling Î IQM+/Risk Researcher Significant interest in integrated solution. User base attractive to insurance partners Î Connectivity Investment / Ins
Slide 18: Wealth Management - Spotlight (South Africa)
Wealth Management - Spotlight (South Africa) For personal use only Î Spotlight is the leading provider in South Africa with a large installed user base (16,000) and strong established client relationships Î Spotlight will continue to provide client support and development locally Î Growth opportunit
Slide 19: Wealth Management – Mthly Subscription Rev
Wealth Management – Mthly Subscription Rev For personal use only Acquisition of Spotlight in Jul’07 3 .5 3 .0 Acquisition of Visiplan business 2 .5 in Apl’07 $m 2 .0 1 .5 Acquisition of PlanTech business 1 .0 in Sept’06 0 .5 0 .0 2003 2004 2005 2006 2007
Slide 20: Wealth Management – Margin Analysis
For personal use only Wealth Management – Margin Analysis % Revenue per Media Release H1 2005 H2 2005 H1 2006 H2 2006 H1 2007 Licence Fee Revenue 97.8% 97.1% 96.7% 97.1% 97.8% Other Rev (News / Roy. / Comms) 2.2% 2.9% 3.3% 2.9% 2.2% Total Direct Staff Costs (67.7%) (55.4%) (49.3%) (45.8%) (45.3%) To
Slide 21: Margin Analysis
For personal use only Margin Analysis Î Higher Q1 margin due to lower staffing levels Î “abnormal” result in April with cutover of VisiPlan billing and costs Î Xplan + PlanTech + Visi -> averaging down from current levels Î Looking forward Costs Commitment to maintain and grow service levels, no
Slide 22: Canada Business
Canada Business For personal use only Î Revenue growth momentum picking up with 15% growth from previous half and 26% pcp. Growth to accelerate through to mid 08. Î Massive increase in Canadian activity rates (trades and particularly orders) has challenged everyone’s infrastructure (clients, competi
Slide 23: Canada – CX Trader Conversion
Canada – CX Trader Conversion For personal use only Î CX Trader Order Entry (OE) significantly rolled out: Main driver of revenue growth in H1 Most contracts included additional sales of IRESS products 90%+ contracted of original list Î CX OMS conversions about to commence Major clients in f
Slide 24: Canada - Outlook
Canada - Outlook For personal use only Î CX OMS installations challenging given market volume pressures, importance of the system and scale of the clients. Î Current roll-out schedule for balance of 07 implies very significant revenue growth by early 08. Contracted and expected conversion should pus
Slide 25: Canada Longer Term Outlook
For personal use only Canada Longer Term Outlook Î Current strategy includes: Trading terminals for Canadian equities and options Retail order flow management (including US FX tools) Institutional order management and compliance FIX connectivity Limited market data around OMS solutions Î E
Slide 26: Canada – Monthly Subscription Revenue
Canada – Monthly Subscription Revenue* For personal use only 1.000 Millions 0.900 CAD 0.800 0.700 Pre-IRESS full production level offering 0.600 0.500 0.400 Apr-04 Apr-05 Apr-06 Apr-07 * Assumes 100% ownership
Slide 27: Strategic Charges
Strategic Charges For personal use only Î Intangibles arising through the acquisition of a business or company Cost (AUD) Tax Description Amortisation period $m Deductible Xplan Software 11.034 5 years (ending Mar 08) Yes Plantech Software 11.440 3 years (ending Oct 09) Yes Wealth Plantech Goodwill
Slide 28: Estimated future strategic charges
For personal use only Estimated future strategic charges Description H1'07 H2'07 H1'08 H2'08 H1'09 H2'09 H1'10 H2'10 Xplan Software 1.070 1.070 0.478 - - - - - Plantech Software 1.907 1.907 1.907 1.907 1.907 0.953 - - Wealth Plantech Goodwill - - - - - - - - Management Visiplan Software 1.385 3.671
Slide 29: For personal use only
A.BN. 47 060 31.3 359 so 1v) O pa! O Zz, ne UO Ww = fe Ww x (a < 2 *