Cyanconnode Holdings Plc · LSE:CYAN
Cyanconnode — FY2018 Earnings Presentation
39 slides from Cyanconnode's earnings presentation, May 2019
Slide 1: 2018 Results Presentation, May 2019
2018 RESULTS PRESENTATION l MAY 2019 l GLOBAL LEADERS IN NARROWBAND RF SMART MESH NETWORKS FOR SMART CITY SOLUTIONS © CyanConnode 2019 1
Slide 2: Disclaimer
Disclaimer The information contained in this confidential document (“Presentation”) has been prepared by CyanConnode Holdings Plc (the "Company"). It has not been fully verified and is subject to material updating, revision and further amendment. This Presentation has not been approved by an authori
Slide 3: About CyanConnode
About CyanConnode • World leader in Narrowband Radio Frequency (RF) Smart Mesh Networks for smart city solutions • Blue-chip client base and partner eco-system validates technology offering • Vendor agnostic model allows multiple routes to market • Revenues in 2019 from existing contracts in UK, Ind
Slide 4: FY 2018 Highlights
FY 2018 Highlights • Revenue of £4.5m achieved for 2018 – Revenues Gross Margin significantly higher than 2017 (2017: £1.2m) +281% +452% • Innovative Omnimesh product launched 2018: £4.5m 2018: £2.7m in June 2018 - generated substantial 2017:£1.2m 2017:£0.5m commercial traction since launch (£15m or
Slide 5: Financial Results
Financial Results 2018 2017 Change Consolidated Profit & Loss £’000 £’000 % Revenue 4,465 1,171 +281% Cost of Sales (1,724) (674) -156% Gross Profit 2,741 497 +452% Gross Profit Percent 61% 42% +19% R&D Costs (2,466) (4,140) -40% Other Operating Costs (6,112) (7,011) -13% Acquisition Costs, (472) (4
Slide 6: Financial Results
Financial Results 31 December 31 December Consolidated Consolidated 2018 2018 2017 Balance Sheet Cash-Flow Statement £’000 £’000 £’000 Intangibles 6,978 7,399 Cash at 1/1/2018 5,394 Investments (Bank Securities) 44 48 Net cash-flow from operating (5,843) activities Property/Plant/Equipment 73 83 Pro
Slide 7: Centre of Excellence
Centre of Excellence • Headquartered in Cambridge, UK, one of the leading technology hotspots in the world – European business functions have been consolidated to Cambridge, providing operational and financial efficiencies Picture • World class engineering team responsible for the development and va
Slide 8: Narrowband RF Technology
Narrowband RF Technology CyanConnode’s RF Smart Mesh • Provides a hybrid (IoT) M2M data communication for utility Network technology smart city solutions – Standards-based, IPv6 LoWPAN narrowband RF technology ✓ Highly Reliable with cellular backhaul – Electricity and soon to be gas, water metering
Slide 9: Typical Smart Metering Deployment
Typical Smart Metering Deployment © CyanConnode 2019 9
Slide 10: Market Opportunity
Market Opportunity • CyanConnode’s technology is focused on smart Global meter market (2017) metering – a huge growth opportunity, with fewer than Gas 25% of the world’s 3bn meters currently smart $2.5bn • Global meter market estimated at $12bn in 2017 - (21%) expected to grow by 14% CAGR p.a. $6bn
Slide 11: Customers and Partners
Customers and Partners Blue-chip client base and partner eco-system validates technology offering Customers Key customer deployments • Deployed 1.04m electricity meters and streets lights to date across approximately 20 customers globally • End customer typically an electricity utility with the UK S
Slide 12: Revenue Model
Revenue Model Perpetual licenses • Perpetual licences for: Modules, Gateways and Software – one off payment plus 22% annual SMC • Term licenses for: Module, Gateway, Software over X years, Royalty Term plus 22% annual SMC licensing licenses Revenue • Support & maintenance contract: per device once M
Slide 13: India
India • Market leading position in India Indian smart metering market set to grow • Significant progress made in the Indian smart metering market during 2018 • Order booking totalled £15.2m for FY 2018 • Revenue of £3.4m for FY 2018 • Launch of Omnimesh smart metering solution gained significant com
Slide 14: Market Potential in India
Market Potential in India Accelerated Growth through Government initiatives Indian Smart Grid • Projected Spent $44.9 bn (2017 to 2022) (Smart meter, storage, Distribution automation) • Eleven Smart Grid demonstration/pilot projects with 50% govt grant in progress. (India Country Report by DST, Govt
Slide 15: Indian Experience
Indian Experience Tata Power, Mumbai CESC, Mysore UGVCL, Ahmedabad MPWZ, Indore © CyanConnode 2019 15
Slide 16: APAC, Europe and Middle East
APAC, Europe and Middle East • Large pipeline of new business South East Asia smart meter estimated growth opportunities • Revenues £1.1 million in 2018 • South East Asia (ex-India) presents attractive market opportunity – pipeline for region > $200 million • First licencing agreement secured in Chi
Slide 17: UK Smart Meter Implementation Programme
UK Smart Meter Implementation Programme CyanConnode’s solution connects meters in ‘not-spots’ UK SMIP Ecosystem Contract and delivery model Hosting Telefonica M2M Payments for Platform CommsHub & Connode Bespoke Work Server Connode Agent Source: Smart DCC + Bespoke services for integration & product
Slide 18: UK Smart Meter Implementation Programme – SMETS2
UK Smart Meter Implementation Programme – SMETS2 • Rollout meters commenced in Q4 2018. To date 0.5m SMET2 meters have been installed • Installations are running at over seven thousand Meters per day • Toshiba approx. 1.5 million hubs made and sent to DCC of which 150K Mesh • Assumption that 10% of
Slide 19: Beijing Instruments
Beijing Instruments • December 2018, the Company signed its first agreement to license Beijing Instrument to manufacture its hardware • BI will pay a royalty to CyanConnode for each item manufactured under its reference designs • Experienced as Contract Equipment Manufacturers (“CEM”) to manufacture
Slide 20: HM Power
HM Power • Order announced in April 2019 for £0.7m. Total order value including software and annual maintenance = £1.5m • Order is for a product with a new feature giving long-range communications (at least 12km), which will maximise the resilience of the RF Smart mesh network in rural areas – e.g.
Slide 21: Sales Pipeline Extract – APAC, Europe and Middle East
Sales Pipeline* Extract – APAC, Europe and Middle East Region Solution Units’000 Asia Pacific Electricity Meters, Lighting, Smart City >2,000 Middle East Electricity Meters 850 Asia Pacific Electricity Meters 625 Europe Electricity Meters 500 Asia Pacific Metering, Lighting 400 Africa Electricity Me
Slide 22: Summary
Summary • £4.5m revenues for FY 2018 – significantly higher than 2017 • Costs significantly reduced during 2018, with a budgeted monthly cash cost base of c.£540k January 2019 • Omnimesh product generated substantial commercial traction since launch - £15m orders in 2018 and >£3m revenue in 2018 – N
Slide 23: Appendices
Appendices © CyanConnode 2019 23
Slide 24: Board
Board Established board with a proven track-record Executive Chairman: John Cronin Non-Executive Director: Paul Ratcliff • Joined the Board in 2012 initially as Non-Executive • Multi-disciplined entrepreneur with a wealth of Director practical experience in creating shareholder value by • Highly suc
Slide 25: Vision, Mission and Values
Vision, Mission and Values Vision Mission Values • Provide connectivity • Leadership • Enable a smart for IoT applications world • Respect globally and build on industry leading smart • Resilience energy solutions • Positivity • Deliver smart technology providing • Integrity innovative solutions and
Slide 26: Narrowband RF Technology
Narrowband RF Technology RF mesh networks provide end-to-end coverage including ‘not-spots’: Self-configuring Nodes determine the best route to the gateway either directly or through another node Self-healing If a node becomes unavailable the network will rearrange itself automatically Multiple hops
Slide 27: Smart Metering
Smart Metering • An intelligent provision of utilities such as gas, electricity and water to consumers and Smart metering benefits enterprises - accurately gauges consumption, Enabler for utilities Empowering consumers controls supply and automatically bills • Automated meter reading • Reduction of
Slide 28: Key Data
Key Data AT A GLANCE SIGNIFICANT SHAREHOLDERS > 3% Market cap £12.3m William David Johns-Powell (Non-Exec Market AIM Director) 9.64% Ticker CYAN Canaccord Genuity Group 7.54% Share price (10.05.19) 6.75p Herald Investment Management Limited 6.80% Shares in issue 182,400,000 Nightingale Investment Co
Slide 29: Growth Strategy
Growth Strategy • To build a sustainable market position in the smart metering leading to a major force in the Industrial IoT sector, for example: – Gas and water metering – District heating – increasing demand for energy-efficient and cost-effective heating systems driven by growing urbanisation an
Slide 30: Market Reach
Market Reach CyanConnode has implemented over 1M devices worldwide FY 2018 market revenue % by region: • India: 76% • APAC, Europe and Middle East: 24% © CyanConnode 2019 30
Slide 31: Solution Overview
Solution Overview Key components of smart meter platform Mesh node Narrowband RF mesh Gateway Network Management System • Embedded into third party smart • Standards-based IPv6 / 6LoWPAN • Typically 1 for every 200 smart • Manages smart meters, mesh meters - enables communication and optimised IPv4
Slide 32: Omnimesh Solution
Omnimesh Solution Network Management System and Smart Metering Application Feature Comments Java-based application • Database and hosting servers usually outside of CyanConnode’s scope • Possibility of cloud-based, managed service High Availability • Pool of Servers / Horizontal scalling High Capaci
Slide 33: Local Production – Make in India
Local Production – Make in India • July’18 : Started Customer Production at Syrma new plant for India Projects – Aug’2018 : First production batch size for customer- 5000 nodes & 45 GWs – Dec’2018 :Production line capacity doubled Month on Month and ramped to 50K nodes and 400 GWs – High Availabilit
Slide 34: Delivery Capabilities
Delivery Capabilities • Lean Delivery Model MPWZ Indore : India’s – Multiple projects under one Project Manager biggest RF Mesh deployment of 66 K • 2 Project Manager : 6 ongoing and 3 under O&M meters ~ consistent • 1 or 2 On Site Engineers on fixed third party contract for each project 99%+ Availa
Slide 35: India - Case Study
India - Case Study MPWZ/ L&T- India Background • Partnered with L&T to deliver smart meters to MPWZ that provides electricity to Indore city Client: MPWZ, Indore • Largest Smart Meter Project in India • is to deliver facility management services for 5 years post Go-to-market partner: L&T deployment
Slide 36: India - Case Study
India - Case Study UGVCL/ GENUS- India Client: UGVCL, Gujarat Background • Partnered with Genus to deliver smart meters to UGVCL Go-to-market partner: Genus that provides electricity to Gujarat Location: Naroda, Gujarat • is to deliver facility management services for 3 years post deployment Challen
Slide 37: India - Case Study
India - Case Study CESC Mysore / Enzen Global Solutions - India Background • Partnered with Enzen to deliver smart meters to Client: CESC Mysore Chamundeshwari Electricity Supply Corporation Limited Go-to-market partner: Enzen (CESC Mysore) that provides electricity to five districts in the Indian S
Slide 38: UK - Case Study
UK - Case Study Telefonica / Toshiba – UK SMIP Client: Telefonica Background • The UK’s Smart Meter Implementation Programme is a major national infrastructure project involving the Go-to-market partner: Toshiba national roll out of 53m gas and electricity meters Location: Across UK across the count
Slide 39: Contact
Contact CyanConnode Plc +44 (0) 1223 225060 l information@cyanconnode.com © CyanConnode 2019 Merlin Place l Milton Road l Cambridge l 39 CB4 0DP