Hsenid Business Solutions Plc · CSELK:HBS.N0000
Hsenid Business Solutions — H1 FY2023 Earnings Presentation
30 slides from Hsenid Business Solutions's earnings presentation, Dec 1, 2022
Slide 1: Inaugural Half-yearly Investor Forum 1H FY2023
hSenid Business Solutions PLC Inaugural Half-yearly Investor Forum 1H FY2023
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation may contain forward-looking statements for which there are risks, uncertainties, and assumptions. Forward-looking statements may include any statements regarding strategies or plans for future operations; any statements concerning new features, enhancemen
Slide 3: Agenda and speakers
& hSenidBiz EMPOWERING PEOPLE THE WORLO OVER # Description Speaker 1 Update on Investor Relations Activities of hSenidBiz Nilendra Weerasinghe 2 Chairman’s Comments Dinesh Saparamadu 3 Business Overview Sampath Jayasundara 4 Financial Update Raveen Lasath 5 Strategy and Focus Nilendra Weerasinghe 6
Slide 4: Chairman's Comments
© bSenidBiz Chairman's Comments Dinesh Saparamadu Executive Chairman and Founder
Slide 5: Business Overview
& hSenidBiz Business Overview Sampath Jayasundara Chief Executive Officer
Slide 6: hSenidBiz At a Glance
hSenidBiz At a Glance Seamless Connection to Third-Party Systems OpenAPIs to connect to third-party ERP, Accounting and other software solutions $10 Bn+ TAM Market Opportunity in APAC and MEA Geared to Handle Large and Complex Organisations Leading Banks, Insurance Companies and local blue-chips and
Slide 7: Full suite HCM software with hire to retire capabilities
Full suite HCM SOFTWARE with HIRE to RETIRE capabilities and other HR related product/software offerings Core Products Employee Journey aided by a Range of HRIS Solutions On Premise: Over 25 modules covering all aspects 813 Clients of HCM, ability to interact with the system through 24+ Years of His
Slide 8: Strong Focus on R&D and New Product Innovation
Strong Focus on R&D and New Product Innovation A Do-it-Yourself HR Software targeting the SME customer segment at an affordable price point. Customer acquisition, implementation and support carried out via digital channels. One-stop-shop with a careful selection of useful software solutions targetin
Slide 9: Quest to be the Dominant HR Tech Player in APAC and MEA markets
Quest to be the Dominant HR Tech Player in APAC and MEA markets c.USD 10 Bn TAM for HCM Software in APAC and MEA Africa & APAC account for 51% of revenues 25% APAC 31% 33% 39% 26% 10% Africa 24% 21% 56% 49% Sri Lanka 45% 40% We are present in markets with robust growth prospects and customer segment
Slide 10: Business Segments: PHR On-Premise
Business Segments PHR On-Premise ▪ Serving large organizations with in-house infrastructure PHR On-Premise revenues and entities with strict data residency requirements LKR mn 3yr CAGR +25% 450 ▪ Government of Uganda was a marquee project-win for (+17% in USD const. currency) PHR On-Premise busine
Slide 11: Business Segments: PHR Cloud
Business Segments PHR Cloud PHR Cloud revenues ▪ Cloud hosted SaaS offering (compatible with Azure, AWS, Google Cloud and currently exploring Huawei LKR mn 3yr CAGR +25% cloud infrastructure) 400 (+16% in USD const. currency) +101% YoY growth ▪ Strong demand from SMEs 350 (+23% in USD const. curre
Slide 12: Business Segments: hSenid Tracking Solutions
Business Segments hSenid Tracking Solutions hSenid Tracking Solutions revenues ▪ Hardware solutions to track, secure and manage human 3yr CAGR +16% and other physical assets of companies LKR mn (+12% in USD const. currency) 100 ▪ Recent growth fueled by increased demand for 90 temperature detectio
Slide 13: Business Segments: PHR Outsourcing
Business Segments PHR Outsourcing PHR Outsourcing revenues ▪ Main focus on providing Payroll Outsourcing services LKR mn • Payroll processing 3yr CAGR +14% • Reporting requirements at completion of the monthly payroll 50 (+20% in USD const. currency) • Disbursement of payments 45 +62% YoY growth (
Slide 14: ARRs Grown at a CAGR of 18% in the Past 3 years
ARRs Grown at a CAGR of 18% in the Past 3 years Core-recurring† revenues reached 48% at 1H FY23 Annual recurring revenues LKR mn 3yr CAGR +18% 450 38% 36% 45% 41% 400 48% +63% YoY growth 350 300 250 200 62% 64% 55% 59% 52% 150 100 50 FY19 FY20 FY21 FY22 1H FY23 - Non-recurring Core - Recurring FY19
Slide 15: Channel Partnerships to Boost APAC and MEA Growth
Channel Partnerships to Boost APAC and MEA Growth Over 50 Partners Already Onboarded in Focused Regions Geography No. of Partners APAC Region Southeast Asia 18 South Asia 19 ANZ 03 MEA Region Middle East 01 Africa 12 Concrete steps taken to boost partner channel sales: 1. A multi-tiered partner prog
Slide 16: New Deal Bookings
New Deal Bookings ▪ Channel Partners accounting for increasing share of New deal bookings new deal bookings (50-55% for FY22; 59% for YTD FY23) USD mn 3.5 ▪ Increasing share of PHR Cloud in new deal bookings 65% for FY22; 58% for YTD FY23) 3.0 ▪ Regionally, Sri Lanka and APAC account for 60-70% of 2
Slide 17: 1H FY23 Key Achievements
1H FY23 Key Achievements ▪ Referral Partnership with Robi Axiata (leading TelCo in Bangladesh) ▪ Partnership with Sri Lanka Telecom PLC to sell PHR Turbo to mid-market customer segment ▪ Incorporation of hSenid Business Solutions Bangladesh as Offshore Development Centre ▪ Awarded Gold under ICT / B
Slide 18: Key Risks and Mitigation Plans
Key Risks and Mitigation Plans ▪ Talent retention and recruitment challenges • Establishment of an Employee Share Ownership Plan (approved via EGM on Dec 6, 2022) • Broadening internship programs • Establishment of an Offshore Development Centre and building talent pools regionally in Sri Lanka • Wo
Slide 19: Financial Update
& hSenidBiz Financial Update Raveen Lasath Head of Finance
Slide 20: Revenue Drill Down
Revenue Drill Down 3Yr CAGR YoY growth All in LKR millions FY19 FY20 FY21 FY22 1H FY23 (in LKR / USD cc) (in LKR / USD cc) PHR On-premise 211 358 368 407 144 Implementation 78 70 151 136 49 Licensing 41 186 110 162 +25% / +17% 44 +76% / +19% Support† 91 103 107 109 51 PHR Cloud 192 208 278 372 324 I
Slide 21: Cost of Sales Drill Down
Cost of Sales Drill Down All in LKR millions FY19 FY20 FY21 FY22 3Yr CAGR 1H FY23 YoY growth On-site and third-party implementation costs† 42 58 58 59 +12% 51 +167% Infrastructure costs†† 16 25 34 53 +48% 78 +290% Cost of devices sold 30 25 28 54 +22% 32 +73% Mobile solutions related costs 135 121 1
Slide 22: Analysis of Recurring EBITDA
Analysis of Recurring EBITDA 56% 32% 14% 14% 29% 49% 27% 47% 13% 45% 46% 25% 12% 43% 24% 21% 20% 18% 8% 16% 16% 7% 13% 11% FY18 FY21 FY20 FY22 FY19 1H FY23 FY20 FY22 FY21 FY18 FY19 1H FY23 FY22 FY18 FY20 FY19 FY21 1H FY23 FY20 FY22 FY18 FY19 FY21 1H FY23 Recurring EBITDA margin COGS as a % of sales
Slide 23: Summarized Income Statements
Summarized Income Statements In LKR millions FY19 FY20 FY21 FY22 1H FY23 Revenue 826 955 961 1,091 704 Gross profit 446 491 513 617 312 Gross profit margin 54% 51% 53% 57% 44% Recurrent EBITDA 175 227 280 298 75 EBITDA margin 21% 24% 29% 27% 11% FX gain 18 11 27 287 193 Net interest income (1) 4 2 2
Slide 24: Cash Position and IPO Fund Utilization
Cash Position and IPO Fund Utilization Cash position at LKR 1.4 Bn IPO fund utilization at 11% LKR mn LKR mn 700 1,600 73 600 1,400 1,200 500 1,000 400 - 800 300 619 600 200 43 350 400 30 100 159 111 200 - - Market Product Potential Total allocation Development Development Strategic FY18 FY19 FY20 F
Slide 25: Free Cash Flow Generation
Free Cash Flow Generation LKR mn 300 200 Includes LKR 73 Mn of incremental 100 "capex-like" cost items - (100) (200) (300) FY18 FY19 FY20 FY21 FY22 1H FY23† Operating cash flow Capex Free cash flow to the firm † Includes higher capex on product development, and impact from working capital Page 25 Pa
Slide 26: Strategy and Focus
& hSenidBiz Strategy and Focus Nilendra Weerasinghe Chief Strategy Officer
Slide 27: New Business Segments: PeoplesHR Turbo
New Business Segments PeoplesHR Turbo ▪ Reconstituted PHR Turbo team during Q2 to function as startup within hSenidBiz • Dedicated marketing, sales, implementation and support team members • Healthy traction with c.20 clients onboarded with average deal size of c.USD 500 ▪ Currently launched in Indi
Slide 28: New Business Segments: PeoplesHR Marketplace
New Business Segments PeoplesHR Marketplace ▪ Currently onboarded c.30 product partners primarily under recruitment, learning & development and compensation & benefits categories ▪ Planning to introduce new integrations with • Leading Application Tracking Systems under Recruitment category • More B2
Slide 29: Update on M&A Plans
Update on M&A Plans ▪ Currently screening opportunities in Tier I and II focus markets ▪ Approach to M&A and objectives being established with respect to focus markets ▪ Valuations for HR Tech companies expected to reduce due to interest rate environment ▪ Targets likely to be legacy companies or ea
Slide 30: Q&A Session
Q&A Session You can use the Q&A functionality in zoom to send in your questions; OR ALTERNATIVELY Click on the "Raise your hand" button to be given an opportunity to unmute your microphone and pose your questions. Investor Relations Contacts Nilendra Weerasinghe – Chief Strategy Officer and Head of
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