Slide 1: WTC 1H23 results investor presentation
ASX Announcement: 2023/15 22 February 2023 WTC 1H23 results investor presentation Attached is the 1H23 results investor presentation for the half-year ended 31 December 2022. //ENDS Authorized for release to ASX by David Rippon, Corporate Governance Executive and Company Secretary. Contact informati
Slide 2: 1H23 Results
1H23 Results © 2023 WiseTech Global
Slide 3: Our Vision and Our Mission
OUR VISION OUR MISSION To be the operating system To create breakthrough products for global logistics that enable and empower those that own and operate the supply chains of the world
Slide 4: Agenda
Agenda 1H 23 1H 23 FINA NC IA L STRATEGY & Q& A A PPE ND IC E S HIG HLIG HT S R E V IE W O U T LO O K 3 © 2023 WiseTech Global
Slide 5: 1H23 highlights
SECTION 01 REPLACE IMAGE 1H23 highlights R IC HA R D W HIT E , C E O & FO U ND E R • Delivered strong 1H23 financial performance • Signed first global customs rollout • Executed strategic move into North America landside logistics • Continued success in CargoWise global rollouts
Slide 6: 1H23 – strong financial performance
1H23 – strong financial performance Reflecting business model resilience and strategic momentum Total Revenue $378.2m CargoWise revenue $289.2m EBITDA $187.3m ↑ 32% organically1 ↑ 46% organically ↑ 42% organically (↑ 35% reported) (↑ 50% reported) (↑ 36% reported) on 1H22 on 1H22 on 1H22 Total reven
Slide 7: Strategically significant acquisitions
Strategically significant acquisitions Extending our key CargoWise development priority of landside logistics • Completed 1 February 2023 • Announced 17 February 2023, expected to complete in April 2023 • Purchase price of US$230m (70% cash / 30% shares) • Purchase price of US$414m (70% cash / 30% s
Slide 8: WiseTech Global - strategic highlights
WiseTech Global - strategic highlights Strategic progress on the ‘3Ps’ to accelerate delivery of our vision PRODUCT PENETRATION PROFITABILITY • Delivered 577 new CargoWise product • Seven new (or additional) rollouts of • Enhancing operating leverage and enhancements in 1H23 CargoWise in FY23, inclu
Slide 9: 1H23 financial review
SECTION 02 REPLACE IMAGE 1H23 financial review A ND R E W C A R T LE D G E , C FO
Slide 10: 1H23 results
1H23 results Revenue Strong financial performance • Total revenue of $378.2m, up 35% on 1H22 • Organically, total revenue grew 32%, excluding tuck-in M&A and FX • CargoWise revenue grew organically 46% on 1H22. In addition, tuck-in acquisitions A$m 1H22 1H23 % change contributed $6.3m in 1H23 vs. $0
Slide 11: 1H23 revenue growth
1H23 revenue growth A$m Total revenue grew 35% ($97.3m) – CargoWise revenue grew 50% ($96.1m) Recurring & non-recurring revenue growth CargoWise & non-CargoWise revenue growth 378.2 2.3 378.2 (4.4) 2.3 1.0 14.5 CargoWise 2.2 Recurring 2.3 Non-CargoWise 0.1 Non-recurring - 99.3 89.1 281.0 18.8 87.9 3
Slide 12: 1H23 operating expenses
1H23 operating expenses1 % of revenue Expenses (A$m) Operating leverage driving margin expansion Overall operating expenses down 3pp as a % of revenue on 1H22 ex M&A costs Product design & development (A$m) Sales & marketing (A$m) General & administration (A$m) 19% 19% 16% 16% 15% 16% 16% 14% 14% 14
Slide 13: 1H23 research and development
1H23 research and development Accelerated innovation and product development Product investment Investment in innovation and R&D investment increased $31.2m, or 37% vs. 1H22 reflecting the previously product development (A$m) • communicated step up in R&D investment and hiring activity to drive futu
Slide 14: 1H23 balance sheet
1H23 balance sheet Strong balance sheet and liquidity providing solid platform for future growth Strong liquidity • $489.9m in cash and $225m undrawn debt facility at 31 December 2022 A$m 30 Jun 22 31 Dec 22 • Providing financial flexibility and liquidity to fund growth opportunities Cash 483.4 489.
Slide 15: 1H23 cash flow performance
1H23 cash flow performance Highly cash-generative business model delivering strong free cash flow Strong operating cash flow A$m 1H22 1H23 % change • Operating cash flows up 51% vs. 1H22 to $203.4m (1H22: $134.7m), demonstrating the strength of our highly cash-generative operating model EBITDA 137.7
Slide 16: Strategy & outlook
SECTION 03 REPLACE IMAGE Strategy & outlook R IC HA R D W HIT E , C E O & FO U ND E R
Slide 17: WiseTech's '3Ps' strategy
WiseTech's ’3Ps’ strategy Strategy delivers sustainable growth through the cycle Vision: To be the operating system for global logistics Need to replace ageing Demand for integrated Logistics providers pursuing legacy systems and global software solutions industry consolidation reduce complexity wit
Slide 18: Development priorities to extend the CargoWise ecosystem
Development priorities to extend the CargoWise ecosystem Continued CargoWise enhancement (577 in 1H23) - Over $775m invested in R&D since 2H18 delivering 5,200+ enhancements 6 CargoWise product development priorities Digital Customs and International Landside logistics Warehouse Neo documents compli
Slide 19: Expanding the CargoWise ecosystem
Expanding the CargoWise ecosystem Extending the core customer proposition and addressable market OPERATING SYSTEM FOR GLOBAL LOGISTICS Domestic Landside Customs & International Customs & Domestic Warehouse Landside logistics Warehouse logistics logistics compliance freight forwarding compliance logi
Slide 20: Landside logistics – North America
Landside logistics – North America Opportunity and value creation from bringing together the capabilities of WiseTech, Blume, Envase Building the operating system for global logistics Envase Blume Enterprise platform - core strengths: North North International forwarding, America America Global cust
Slide 21: Penetration
Penetration Momentum through existing customer growth & new global rollout wins 4 new global rollouts by Large Global 3 additional organic rollouts Recent industry consolidation In FY23, CargoWise had global rollouts Freight Forwarders1 secured since 1 July ‘In Production’ ’In Production’ or ‘Contra
Slide 22: Profitability
Profitability Enhancing operating leverage and supporting growth Streamlining processes Internal development of our Optimizing our integrated Allocating resources and teams existing teams cost structures appropriately Driving returns by leveraging high growth and scalable SaaS model with 86% gross p
Slide 23: FY23 guidance
FY23 guidance Continued strong growth outlook, confirms current guidance and updates for recent M&A activity Revenue EBITDA EBITDA% • CargoWise revenue ~30-35% growth ex. FX FY23 Current guidance $755m-$780m $385m-$415m 51%-53% • Bolero (Jul ‘23) 1pp margin dilution FY23 growth vs. FY22 20%-23% 21%-
Slide 24: Business model and strategy delivering sustainable shareholder value
Business model and strategy delivering sustainable shareholder value Revenue (A$m) EBITDA (A$m) $790 - $822 48%–50%1 600.0 EBITDA Margin % 50% 800 41% 500.0 700 $632.2 $380–$4121 600 35% 35% 400.0 $507.5 30% 31% 30% 500 $429.4 $319.0 300.0 400 $348.3 $206.7 300 200.0 $221.6 $126.7 200 $153.8 $108.1
Slide 25: Q&A
SSEEC CTTIIO ONN0 044 REPLACE IMAGE Q&A
Slide 26: Appendices
SECTION 05 Appendices REPLACE IMAGE Slides 26. FY23 guidance assumptions and FX 27. FY23 EBITDA guidance from FY22 Results presentation 28. Customer growth and low attrition 29. Earnings diversification 30. 1H23 organic growth 31. Overview of revenue licensing models 32. Income statement 33. Key ope
Slide 27: FY23 guidance assumptions and FX
FY23 guidance assumptions and FX What is included in the FY23 guidance: Foreign Exchange FX rates1 vs. AUD FY22 actual 1H23 actual 2H23 Guidance • Retention of existing CargoWise customers consistent with historical levels USD 0.74 0.73 0.71 • ~80% of 1H23 revenue in non-AUD currencies, 3pp higher t
Slide 28: FY23 EBITDA guidance from FY22 Results presentation
FY23 EBITDA guidance from FY22 Results presentation Continued strong growth outlook FY23 revenue FY23 guidance assumptions 1 CargoWise: revenue growth of ~30% – 35% (excluding FX) $755m – $780m • Continued momentum from FY22 run rate Guidance provided in line with these • 1H/2H revenue more evenly d
Slide 29: Customer growth and low attrition
Customer growth and low attrition CargoWise1 application suite revenue by customer cohort Increasing adoption by Large Global A$m (last 12 months) 600 Freight Forwarders 550 Top 300 customers deliver ~75% of CargoWise 500 revenue in 1H23, consistent with FY22 450 400 350 Customers stay and use more
Slide 30: Earnings diversification
Earnings diversification Revenue by customers1 (%) 1H23 Revenue by geography2,3 (%) 29% 40% Europe, Middle East & Africa 73% 71% 69% Rest of customers Top 11-20 largest customers Asia Pacific Top 10 largest customers Americas 31% 6% 7% 6% 21% 23% 24% We are a global company with customers operating
Slide 31: 1H23 organic growth
1H23 organic growth1 A$m Revenue EBITDA EBITDA margin CargoWise Non-CargoWise Total % % % % 1H23 1H22 1H23 1H22 1H23 1H22 1H23 1H22 1H23 1H22 change change change change change Group total - Reported 289.2 193.0 50% 89.1 87.9 1% 378.2 281.0 35% 187.3 137.7 36% 50% 49% 1pp Less acquisitions 6.3 0.7 6
Slide 32: Overview of revenue licensing models
Overview of revenue licensing models Total revenue by license type (A$m) Other revenue $378.2 Recurring revenue (96% of revenue)1 (4% of revenue)1 $351.2 14.5 39.4 One-Time 47.6 On-Demand Licensing Licensing (OTL) OTL & support Revenue $281.0 86%1 maintenance services 4%1 $268.8 10%1 37.1 $238.7 18.
Slide 33: Income statement
Income statement A$m 1H22 1H23 Revenue Recurring On-Demand license 225.0 324.3 Recurring OTL maintenance 37.1 39.4 OTL and support services 18.8 14.5 Total revenue 281.0 378.2 Cost of revenues (38.4) (51.4) Gross profit 242.6 326.9 Operating expenses Product design and development (45.2) (54.3) Sale
Slide 34: Key operating metrics
Key operating metrics 1H22 1H23 Total revenue growth vs. prior year 18% 35% Recurring revenue – % of total revenue 93% 96% On-Demand license revenue – % of total revenue 80% 86% Gross profit margin 86% 86% Product design & development – % of total revenue 16% 14% Total R&D – % of total revenue 30% 3
Slide 35: Reconciliation of statutory expenses to non-statutory expenses
Reconciliation of statutory expenses to non-statutory expenses A$m 1H22 1H23 Cost of Revenues Cost of revenue – statutory 42.4 56.9 Less: Depreciation & amortization 4.0 5.5 Cost of revenues – non-statutory 38.4 51.4 Product design & development Product design & development – statutory 66.7 80.9 Les
Slide 36: Reconciliation of underlying NPAT, NPATA and underlying ETR
Reconciliation of underlying NPAT, NPATA and underlying ETR A$m 1H22 1H23 Net Profit after Tax (NPAT) NPAT 77.4 109.0 Fair value gain on contingent consideration (0.1) - Non-recurring tax on acquisition contingent consideration - (0.6) Underlying NPAT1 77.3 108.5 NPAT 77.4 109.0 Fair value gain on c
Slide 37: Pro forma balance sheet and liquidity update
Pro forma balance sheet and liquidity update 1H23 2H23 to date Envase Blume Pro forma • Closed acquisition of Envase on 1 February 2023 A$m • Announced acquisition of Blume on 17 Feb 2023, expected to close in April 2023 Cash and Cash Equivalents 490 90 (233) (195) 151 • USD acquisition amounts conv
Slide 38: Trinium revenue reclassification
Trinium revenue reclassification • Trinium is a key component of our landside logistics strategy 1H19 1H20 1H21 1H22 1H23 FY19 FY20 FY21 FY22 • Inline with the announced acquisitions of Envase and Blume A$m which will be reported in CargoWise revenue, Trinium’s revenue will also be reported in Cargo
Slide 39: Revenue growth drivers
Revenue growth drivers CargoWise recurring revenue delivers 31% CAGR CargoWise recurring revenue growth FY16 to FY22 (constant currency) • 31% CAGR FY16 to FY22 • Significant R&D investment driving long-term growth 632.2 • Revenue growth of $337.1m, ~5X over the last 6 years • Major recurring revenu
Slide 40: CargoWise recurring revenue growth drivers
CargoWise recurring revenue growth drivers Details on inclusions in each category of revenue drivers CargoWise recurring revenue growth drivers Growth rate FY16 to FY22 (averages per year) What’s included Growth in users and transactions from Large Global Large Global Freight Forwarder rollouts 12pp
Slide 41: Large Global Freight Forwarder rollouts driving revenue growth
Large Global Freight Forwarder rollouts driving revenue growth 43 Large Global Freight Forwarder rollouts are driving long term revenue growth Annual revenue (A$m)1 in constant currency 11 Large Global 32 Large Global Freight Forwarders with rollouts of CargoWise Freight Forwarders ‘In Production’2
Slide 42: Global rollouts
Global rollouts Reconciliation of CargoWise global rollouts In Production1 Contracted1 Total LGFF1 Top 251 As at 30 June 2022 32 11 43 10 New contracts signed: - 2 2 - NTG Nordic Transport Group, IFB International Freightbridge New organic rollouts ‘In Production’: 3 - 3 - DB Group, Jet Internationa
Slide 43: Glossary
Glossary Abbreviation Definition First reference slide A customer attrition measurement relating to the CargoWise platform (excluding any customers on Annual Attrition rate - non-CargoWise platforms). A customer’s users are included in the customer attrition calculation upon 28 leaving i.e. having n
Slide 44: Market conditions - global supply chain
Market conditions - global supply chain GLOBAL TRADE & FREIGHT STRUCTURAL INDUSTRY TRENDS • Merchandise trade volume growth of 3.5% in 2022, up from previous • Ongoing investment in integrated global technology that WTO forecast of 3.0%, and expected increase of 1.0% in 2023, down drives efficiency,
Slide 45: Important notice and disclaimer
Important notice and disclaimer Content of presentation for information purposes only Preparation of information Visit wisetechglobal.com/investors All financial information has been prepared and reviewed in accordance with Australian Accounting Standards. Certain financial data included in this pre
Slide 46: wisetechglobal.com/investors
wisetechglobal.com/investors