Slide 1: Investor & Analyst Briefing
Investor & Analyst Briefing Half year ended 31 December 2024 Presented: 18 February 2025 by Chairman Matthew Sandblom CEO Jose Palmero CFO Adam McArthur 3P Learning Limited ABN 50 103 827 836
Slide 2: Important Notice and Disclaimer
Important Notice and Disclaimer The material in this presentation is a summary of 3P Learning Limited’s (“3P”) activities and results as at the time of preparation, 18 February 2025. No representation, express or implied, is made as to the fairness, accuracy, completeness or correctness of informati
Slide 3: Agenda
Agenda • Chairman’s Update • Outlook • CEO Update • Q&A • CFO: Results & Cash Flow • Appendices 3
Slide 4: Chairman’s Update
Chairman’s Update Matthew Sandblom
Slide 5: 1H25 Highlights and Product Investment
Chairman’s Update 1H25 Highlights and Product Investment Improved profitability, sales steady as we transition to the 3 Essentials model: • ARR is steady, revenue is down 2% on Dec 2023, profitability is up 98% • Cost management initiatives are delivering profit improvement 3 Essentials approach imp
Slide 6: 1H25 Highlights and Product Investment
Chairman’s Update 1H25 Highlights and Product Investment B2C stable in challenging market conditions: • Billings up 1% on pcp despite cost of living headwinds for parents • Significant improvements in functionality to improve conversion and upgrade to yearly subscriptions • Exploring opportunities f
Slide 7: CEO Update
CEO Update Jose Palmero
Slide 8: 1H25 Highlights
CEO Update 1H25 Highlights UNDERLYING1 EBITDA REVENUE3 B2C BILLINGS4 B2B ARR5 $6.8m $52.7m $22.0m $64.4m +98% -2% +1% +0% vs pcp2 vs pcp vs pcp vs pcp UNDERLYING1 CASH FLOW FROM CUSTOMERS PRODUCT OTHER INVESTMENT OPERATIONS BEFORE TAX >5.0m $14.9m $1.4m $1.4m • $12.4m Product development - • B2B Lic
Slide 9: Performance in the Consumer Market
CEO Update Performance in the Consumer Market 1% consumer billings1 growth in 1H25 vs 1H24, steady performance across all key markets and channels. • Reading Eggs, Mathseeds and Mathletics billings were $22.0m, up 1% on pcp despite tougher economic conditions. • Net billings contribution margin of 5
Slide 10: Performance in the Schools Market
CEO Update Performance in the Schools Market 1H25 FY24 +/- % +/- 1H24 The graph below shows school ARR trajectory for 1H24 1 Closing ARR ($m) 64.4 62.1 2.3 4% 64.2 (Dec-23), FY24 (Jun-24) and 1H25 (Dec-24). Licences2 (m) 4.9 4.8 0.1 1% 5.2 Exit ARPU3 ($) 13.3 12.9 0.4 3% 12.4 • B2B Revenue was $30.9
Slide 11: 3 Essentials combines our evidence-based programs
CEO Update • 3 Essentials combines our evidence-based programs for reading, writing and maths into an integrated solution with SSO, simpler navigation, easy class management and consolidated reporting. • Package price represents best value to schools. • Launched in Q1 FY25 in APAC, so far 214 school
Slide 12: USA Update
CEO Update USA Update Retention Rates • In April 2024 we bought back the Schools distribution rights for 100% Reading Eggs in the US from Edmentum for A$20m. 80% 80% 74% • This gives us greater direct presence and customer relationships in the US schools market to cross-sell our 60% products. 40% 20
Slide 13: Our Programs
Our Programs Acquired Jan 3, 2025 Improving student Improving student Teaching children Learning to read Where children Writing and maths achievement in engagement foundational made fun and learn to write with assessment spelling, grammar and achievement maths and rewarding for confidence and that m
Slide 14: Our Strategy
CEO Update Our Strategy B2B B2C Markets (AMER, EMEA, APAC) Markets (AMER, EMEA, APAC) 14
Slide 15: Acquisition of Intrepica (LiteracyPlanet)
CEO Update On January 3, 2025 we acquired 100% of Intrepica Pty Ltd (the owner of LiteracyPlanet). Update: • LiteracyPlanet has $2.2m of ARR that is incremental to our business. We expect this to be profitable and cashflow positive in the first year. • The business operates in APAC and EMEA markets
Slide 16: Product Releases and Improvements
CEO Update Product Releases and Improvements Achieved in 1H25 What’s coming in 2H25 APAC 3 Essentials SSO, One Roster 3 Essentials cross-program reporting Weekly Quests for Reading, Writing and Maths Teacher Hub Golden Stepping stones USA district interface upgrade, WACG accessibility compliance USA
Slide 17: CFO: Results & Cash Flow
CFO: Results & Cash Flow Adam McArthur
Slide 18: P&L Key Drivers
Results Analysis P&L Key Drivers Profit and Loss Statement 1H25 1H24 +/- %+/- $m Revenue • B2B revenue decreased by $1.3m against pcp due to declining B2B 30.9 32.2 (1.3) (4%) licence numbers, primarily impacted by the transition from B2C 21.8 21.7 0.1 0% Total revenue 52.7 53.9 (1.2) (2%) Edmentum
Slide 19: B2C Performance Metrics
Results Analysis B2C Performance Metrics $m 1H25 1H24 +/- % +/- $m 1H25 1H24 +/- %+/- 5 Gross Billings 1 22.0 21.8 0.2 1% Revenue 21.8 21.7 0.1 0% 2 Licences (k) 280.0 291.0 (11.0) (4%) 3 Expenses ARPU ($) 78.6 74.9 3.7 5% Sales, Marketing & Cost of Revenue6 (12.8) (12.9) 0.1 1% Contribution Margin
Slide 20: B2B Performance Metrics
Results Analysis B2B Performance Metrics $m 1H25 FY24 $m 1H25 1H24 +/- % +/- 3 Opening ARR 62.1 65.4 Revenue 30.9 32.2 (1.3) (4%) Acquired business1 2.2 - Expenses New business 3.1 5.5 Sales, Marketing & Cost of Revenue4 (15.1) (17.2) 2.1 12% Net upsell/downsell 1.0 2.3 Contribution Margin 15.9 15.0
Slide 21: Cash Bridge
Results Analysis Cash Bridge • Underlying Cash Flow from Operations before tax was $1.4m vs ($2.4m) in pcp representing a $3.8m improvement. • Net PPE & intangibles addition of $2.9m. • Closing net cash2 of $1.9m at 31 December 2024. • $6.0m undrawn loan facility at 31 December 2024. The loan facili
Slide 22: Outlook
Outlook
Slide 23: Medium Term Outlook
Outlook Medium Term FY25 is a transformation year • We have passed the peak of our large investment in new and existing products • Simplifying our operations and increasing efficiency of operation • Improve our bundling and growth of revenue per school, alongside new business • Continued improvement
Slide 24: Appendices
(@)3P Learning
Slide 25: Glossary
Appendices Glossary Term Definition ARR Annual Recurring Revenue Churn Percentage Churn Percentage is calculated as a proportion of the opening School ARR in a rolling 12 or 6 month period (as relevant). Earnings before interest, tax, depreciation and amortisation, excluding unrealised foreign excha
Slide 26: Q&A
Q&A
Slide 27: Thank You
Thank You