Slide 1: Results Presentation
For personal use only Results Presentation For the twelve months ended 31 December 2018 To be read in conjunction with Appendix 4E and Accounts LAWYER PLUMBER ACCOUNTANT BUTCHER BUILDER
Slide 2: The Reckon Story
The Reckon Story For personal use only Our mission is to bring millions of businesses and professionals closer together with our software to create a brave new, connected economy... It’s been quite a ride already. Hundreds of Thousands of businesses around 2. Practice Management - Accountants the wo
Slide 3: The agenda
The agenda For personal use only 1. Business update - CEO 2. Financial update - CFO 3. Reckon Strategic Direction 4. Q & A 3
Slide 4: 1. CEO update
1. CEO update For personal use only Sam Allert RECKON CEO 4
Slide 5: Core areas of the business
Core areas of the business For personal use only BUSINESS PRACTICE MANAGEMENT PRACTICE MANAGEMENT GROUP - ACCOUNTANT GROUP - LEGAL GROUP Cost recovery, An ecosystem for A platform for scanning and print small businesses accountants solutions for legal firms We provide accounting software to Market l
Slide 6: Our Focus – Set ourselves up for growth
Our Focus – Set ourselves up for growth For personal use only Cloud first strategy Expanding Product Range New Markets Created FOCUS ON CLOUD A FOCUS TO BUILD OUT OUR STRATEGY TO UNLOCK NEW SUBSCRIPTION ECOSYSTEM REVENUE STREAMS Focus on customer migration to the Single Touch Payroll Solution Medica
Slide 7: Results summary
Results summary Continuing Businesses For personal use only Revenue EBITDA NPAT (Excluding transaction costs) (Excluding transaction costs) 75.4 $ $ 30.6 $ 8.8 million million million -6% -2% +2% 7
Slide 8: Results summary
Results summary For personal use only FY18 FY17 Revenue $M $M GROWTH SUBSCRIPTION REVENUE BUSINESS 27.8 27.2 +2% ACCOUNTANT 23.3 23.6 -1% LEGAL 8.4 8.9 -5% 59.5 59.7 OTHER REVENUE 16.0 20.6 -23% TOTAL REVENUE - CONTINUING BUSINESS 75.4 80.3 -6% OVERHEADS - CONTINUING BUSINESS 44.8 49.1 -9% EBITDA 30
Slide 9: Business Group highlights
Business Group highlights For personal use only Over 54,000 cloud users (17% annualised user Online user growth growth). USERS 8% cloud revenue growth over FY17. 55k 54K 50k 45% of available revenue is now cloud. 45k Released new products for growth. 40k Opened new markets for growth (Allied Health
Slide 10: Practice Management Accountant Group highlights
Practice Management Accountant Group highlights For personal use only Subscription revenue solid despite disruption Reckon APS seat growth* to business. 82k 80k 81k Impressive customer list. APS Move to the cloud – PM 11, SD, Timesheets PIQ dashboard reporting. 71k New products for growth: CR, BD. 6
Slide 11: Practice Management - Legal
Practice Management - Legal For personal use only Repositioned the division from Cost Recovery Expanding scan opportunity to new markets such provider to detailed WorkFlows expert in three key as: HealthCare and Accounting. areas: • Cost Recovery Development team focused on next generation • Print M
Slide 12: 2. Financial Update
2. Financial Update For personal use only Chris Hagglund RECKON CFO 12
Slide 13: Financial performance
Financial performance Revenue For personal use only FY18 FY17 GROWTH $M $M % CONTINUING BUSINESS 75.4 80.3 -6% DISCONTINUED - 10.0 75.4 90.3 EBITDA CONTINUING BUSINESS 30.6 31.3 -2% DISCONTINUED - 1.9 TRANSACTION COSTS (1.4) (1.6) 29.2 31.6 NPAT $M $M CONTINUING BUSINESS 8.8 8.7 +2% TRANSACTION COST
Slide 14: Business financials
Business financials Subscription business with strong online growth. For personal use only Revenue FY18 FY17 Financial performance $M $M GROWTH • Revenue SUBSCRIPTION 27.8 27.2 2% • ARPU impacted by faster growing Reckon One. • Subscription now 89% of available revenue. LOAN INCOME 0.9 0.7 28% • 8%
Slide 15: Practice Management Accountant Group Financials
Practice Management Accountant Group Financials For personal use only Subscription focus with an already impressive customer base. Revenue FY18 FY17 Financial highlights $M $M GROWTH • Revenue SUBSCRIPTION 23.3 23.6 -1% • Solid subscription revenue in difficult circumstances. UPFRONT AND SERVICE 0.5
Slide 16: Practice Management-Legal financials
Practice Management-Legal financials Impressive customer base with strong opportunity to grow scan & print markets For personal use only Revenue FY18 FY17 Financial highlights $M $M GROWTH • Revenue SUBSCRIPTION 8.4 8.9 -5% • Strong scan growth, but weaker cost recovery renewals. UPFRONT AND SERVICE
Slide 17: Cashflow highlights and Development spend
Cashflow highlights Development spend For personal use only FY18 FY17 25 $M $M 22.8 OPERATING CASHFLOW: 20 19.6 CONTINUING BUSINESS 10.9 10.9 18.3 16.8 17.2 DISCONTINUED BUSINESS - (1.2) 14.9 15 14.3 DEBT REPAID (6.0) (1.0) 12.4 12.1 A$m DIVIDENDS PAID (3.4) (3.4) 10.7 10 Cash spend on development i
Slide 18: 3. Reckon Strategic Direction
3. Reckon Strategic Direction For personal use only Sam Allert RECKON CEO 18
Slide 19: Focus on growth
Focus on growth For personal use only Target cloud Grow new product Grow new market growth revenue revenue 19
Slide 20: New products and markets for growth
New products and markets for growth For personal use only Single touch payroll First of its kind industry partnership with launch of Books + a white Over 750,000 SME’s with 19 or less labelled version of Reckon One employees will require STP compliant software by 1 July 2019 35,000 IPA Members with
Slide 21: New products and markets for growth
New products and markets for growth For personal use only Bank feed processing tool for Major release of Practice accountants and bookkeepers Management providing cloudification Advisor functionality for supporting non-trading entities Cloud timesheets and APS client hub Most affordable bank feed so
Slide 22: New products and markets for growth
New products and markets for growth For personal use only SCAN & PRINT SOLUTIONS Launch of cloud-based practice Completely re-written and decoupled from management software for health, the cost recovery product. medical, and fitness professionals Complementary products that can be sold Focus on alli
Slide 23: 4. Q & A
For personal use only 4. Q & A 23
Slide 24: Resources
Resources For personal use only Website About us Investors Media reckon.com reckon.com/au/about-us reckon.com/au/investors reckon.com/au/media 24