Slide 1: Results Presentation, Period Ending March 2008
For personal use only Results Presentation Period Ending March 2008 Adrian Di Marco June 2008 Executive Chairman www.TechnologyOneCorp.com Private and Confidential 1
Slide 2: TechnologyOne Overview
TechnologyOne Overview For personal use only TechnologyOne develops, markets, sells, implements and supports a broad range of enterprise applications: TechnologyOne Financials TechnologyOne Supply Chain TechnologyOne HR & Payroll TechnologyOne Works & Assets TechnologyOne Business Intell
Slide 3: Agenda
Agenda For personal use only 2008 Half Year Results Summary Analysis Significant Achievements Last Six Months Outlook Our Strategy for Growth 3
Slide 4: Half Year Revenue $49.5m, up 30%
2008 Half Year Results For personal use only Half Year Revenue $49.5m, up 30% Profit After Tax $6.97m, up 15% Impacted by Avand acquisition – loss of approx $700k Profit Before Tax $8.95m, up 12% Expenses excluding R&D $30.7m, up 31% Extended executive & senior management team New ‘Hou
Slide 5: Results from Existing Operations
2008 Half Year Results from Existing Operations For personal use only Excluding the recent Avand acquisition, which contributed a loss of approx $700k, the results would have been as follows: Half Year Revenue $46m, up 22% Profit Before Tax $9.7m, up 22% Expenses excluding R&D $27.9m, up 19%
Slide 6: Balance sheet strong
2008 Half Year Results For personal use only Balance sheet strong Cash & Equivalents*: $20.8m (vs $22.9m 31/3/07) Debt/Equity: 6% (vs 3% last year) Transparency of results – all R&D fully expensed Dividend increased to 1.67 cents up 10% Board target payout for full year is 72%, as we acc
Slide 7: For personal use only
2008 Half Year Results For personal use only * There was no dividend declared for the comparative period of 31 March 2007, as at that time, 31 March did not signify a half year end. For the six months ended 31 December 2006, the Directors declared a dividend of 1.52 cents per share, that was paid in
Slide 8: Excluding ECM (Avand)
2008 Half Year Results Excluding ECM (Avand) For personal use only * There was no dividend declared for the comparative period of 31 March 2007, as at that time, 31 March did not signify a half year end. For the six months ended 31 December 2006, the Directors declared a dividend of 1.52 cents per s
Slide 9: Historical annual compound growth
2008 Half Year Results For personal use only Historical 10 year annual compound growth is as follows: Revenue: 23% per annum compound R&D: 22% per annum compound Net Profit: 27% per annum compound 2007 – 2008 Half Year end 31 March 2000 – 2006 Half Year end 31 December Note1: The company has p
Slide 10: Analysis
2008 Half Year Results – Analysis For personal use only Total licence fees of $12.1m, up 21% Annual licence fees of $14.3m, up 23% Consulting services of $15.1m, up 37% Project Services revenue of $5m, up 28% 50+% of our revenues generated from existing clients 10
Slide 11: Geographical Analysis
2008 Half Year Results – Geographical Analysis For personal use only All regions except Asia Pacific performed well North West region performed strongly, profit contribution up 79% (up $1.2m) to $2.7m QLD profit up 38% ($414k) to $1.5m SA profit up 39% ($115k) to 411k WA profit up substant
Slide 12: Geographical Analysis
2008 Half Year Results – Geographical Analysis For personal use only Central region performed strongly, profit contribution up 182% (up $2.3m) to $3.6m NSW profit up 44% ($301k) to $981k VIC profit up 181% ($886k) to $1.4m ACT profit up significantly ($1.15m) to $1.3m 12
Slide 13: Geographical Analysis
2008 Half Year Results – Geographical Analysis For personal use only Asia Pacific region performed below expectations, profit down significantly ($853k) with a combined loss of $433k PNG profit down $641k to a loss of $378k Currently renegotiating a large contract Malaysia contributed loss o
Slide 14: Geographical Analysis
2008 Half Year Results – Geographical Analysis For personal use only UK loss of $319k (vs a loss of $799k pcp) Performing ahead of expectations 2 new significant high profile contracts signed • Royal Liverpool Children's Hospital • Institute of Education, a college of University of London Cl
Slide 15: Product Analysis
2008 Half Year Results – Product Analysis For personal use only TechnologyOne Business Intelligence licence fees up strongly, 291% ($2.2m) to $2.9m TechnologyOne Works & Assets licence fees up strongly, 159% ($997k) to $1.6m TechnologyOne Financials licence fees up 19% ($504k) to $3.2m Techn
Slide 16: Product Analysis
2008 Half Year Results – Product Analysis For personal use only TechnologyOne HR & Payroll licence fees continued to improve, up 63% ($202k) to $524k We expect strong growth over the next few years TechnologyOne Student Management licence fees down significantly 85% ($3.31m) to $603k We expe
Slide 17: Strong result and resilience of business model
2008 Half Year Results For personal use only Strong result & demonstrates resilience of our business model Continuing strong demand for our products: 21% increase in licence fees Continued investments as follows: HR & Payroll loss of $728k – strong opportunities in coming years ECM loss of
Slide 18: Agenda
Agenda For personal use only 2007 Half Year Results Summary Analysis Significant Achievements Last Six Months Outlook Our Strategy for Growth 18
Slide 19: Significant Achievements Last Six Months
Significant Achievements Last Six Months For personal use only Acquisition of Avand House of Products Business Transformation Corporate Shared Services Created Continuing Momentum of CI series Research & Development Off Shore Development Momentum in United Kingdom Restructure of New
Slide 20: Acquisition of Avand
Acquisition of Avand For personal use only Avand – Enterprise Content Management business Avand company acquired for between $6.1m - $7.1m $9m plus $1m earnout (if targets met), less $2.9m cash on the balance sheet Loss of approx $700k this half Business 95% integrated into TechnologyOne (
Slide 21: House of Products Business Transformation
House of Products Business Transformation For personal use only 21
Slide 22: House of Products Business Transformation
House of Products Business Transformation For personal use only Organisational restructure and change management substantially completed General Managers appointed to drive each product Systems re-aligned New KPIs & Management Reporting rolled out Profitability by product and by region/sta
Slide 23: Corporate Shared Services Created
Corporate Shared Services Created For personal use only Corporate Shared Services group created: Finance, HR, Payroll, Internal Systems, Legals, Administration Provide world class services to our business units Facilitate fast integration of acquired businesses Avand integration completed
Slide 24: Continuing Momentum of CI series
Continuing Momentum of CI series For personal use only Connected Intelligence (Ci) is the new generation of our suite of products Significant competitive advantage over our competitors Strong demand for our products, due to our new Connected Intelligence (Ci) series Only Enterprise vendor to
Slide 25: Research & Development
Research & Development For personal use only R&D running at 20% revenue Target is 18% of revenue (save $2m per year) New initiatives Customer Relationship Management (CRM) Next Gen platform for our next generation product Mobile computing platform Pipeline of licensable ‘add ons’ for e
Slide 26: Off Shore Development
Off Shore Development For personal use only Relationship with Mitrais (based in Indonesia) Trialled and very successful to date Systems and processes now in place Cost effective, high quality Address overflow or time critical requirements Expanding from 16 developers to 26 developers 26
Slide 27: Momentum in United Kingdom
Momentum in United Kingdom For personal use only 2 new significant high profile contracts signed • Royal Liverpool Children's Hospital • Institute of Education, a college of University of London • Total of 6 customers in the UK Target close to breakeven for full year Prepare for next stage of
Slide 28: Restructure of New Zealand
Restructure of New Zealand For personal use only New Zealand has under performed over the last few years New Zealand now broken into 2 regions Auckland Wellington 2 Regional Managers appointed Focus and accountability on each region Will see a substantial improvement in profitability i
Slide 29: Agenda
Agenda For personal use only 2007 Half Year Results Summary Analysis Significant Achievements Last Six Months Outlook Our Strategy 29
Slide 30: Outlook – This Year
Outlook – This Year For personal use only Guidance of 15% to 20% growth on track for 2008 year Avand business to breakeven in second half Strong forward pipeline of opportunities Strong committed Annual Licence Fees in second half $21m Annual Licence fees in H2 vs $14.3m in H1 Cost of pr
Slide 31: Outlook – This Year: Challenges
Outlook – This Year For personal use only Challenges Staff acquisition and retention R&D to reduce to 18% of revenue UK to come close to breakeven Malaysia to breakeven Managing costs in line with revenue growth • New systems to handle scaling of our business • Investment in new geograph
Slide 32: Growth General
Growth General For personal use only Now created an extensive suite of products that we can sell TechnologyOne Financials TechnologyOne Supply Chain TechnologyOne HR & Payroll TechnologyOne Works & Assets TechnologyOne Business Intelligence TechnologyOne Performance Planning Technolo
Slide 33: Growth General
Growth General For personal use only Focus on new customer sales Double the size of the sales team over the next 24 months Focus on our vertical markets (enterprise solutions) Focus on ‘Best in Class’ entry into organisations Focus on existing customer sales Increase size of CRM team F
Slide 34: Growth: Higher Education and Local Government
Growth For personal use only Higher Education/Student Management Consolidation continues in this markets TechnologyOne solution well regarded Good pipeline of opportunities Challenge – need to get our first Connected Intelligence sites live Local Government Consolidation continues in t
Slide 35: Growth: Financials and HR & Payroll
Growth For personal use only Financials Enterprise market confusion continues delaying replacement cycle Good pipeline of opportunities going forward for new customers HR & Payroll Highly fragmented market – many ‘old legacy’ systems Well positioned: Ci series Product functionality iss
Slide 36: Growth: Business Intelligence and ECM
Growth For personal use only Business Intelligence (BI) Compelling business proposition for our customers • Fully integrated, works ‘out of the box’, TechnologyOne data aware Target existing customers in the short/medium term Strong pipeline of opportunities Enterprise Content Management
Slide 37: Growth: Works & Assets
Growth For personal use only Works & Assets Compelling business proposition for our existing customers • Fully integrated, Works ‘out of the box’, TechnologyOne data aware Target existing customers in the short/medium term Strong pipeline going forward of existing customers TechnologyOne P
Slide 38: Growth: Long term opportunities
Growth For personal use only Long term opportunities: CRM Acquisitions of further products under our new House of Products business model Further geographical expansion ‘NextGen’ – next generation products 38
Slide 39: Growth - Geographies
Growth - Geographies For personal use only Australia Both Central & North West strong continuing momentum New Zealand Execution to be improved through restructure Profit currently only $45k half year vs $1.3m full year in 2006 Asia Challenging market United Kingdom United Kingdom 3
Slide 40: Agenda
Agenda For personal use only 2007 Half Year Results Summary Analysis Significant Achievements Last Six Months Outlook Our Strategy 40
Slide 41: Our Strategy
Our Strategy For personal use only ‘House of Product’ business model to bring focus and ‘execution excellence’ Continue to expand our existing products via licensable ‘add ons’ that deliver significant incremental value to our existing customers Continue to expand our product range and custome
Slide 42: Results Presentation, Period Ending March 2008
For personal use only Results Presentation Period Ending March 2008 Adrian Di Marco June 2008 Executive Chairman www.TechnologyOneCorp.com Private and Confidential 42