Temenos Ag · SIX:TEMN
Temenos — Merger or Acquisition (September 2008)
18 slides from Temenos's merger presentation, Sep 17, 2008
Slide 1: Acquisition of Financial Objects
Acquisition of Financial Objects 17 September 2008
Slide 2: Disclaimer
Disclaimer Any remarks that we may make about future expectations, plans and prospects for the company constitute forward-looking statements. Actual results may differ materially from those indicated by these forward-looking statements as a result of various factors. In particular, the forward-looki
Slide 3: Contents
Contents 1. Transaction summary – Max Chuard 2. Rationale for the deal 3. Integration plan 4. Financial impact 5. Q&A Slide 3 13/11/2007
Slide 4: Transaction summary
Transaction summary An offer of 60p per share was made for Financial Objects on 2 July 2008 This offer valued the company at GBP 27.2m (USD 49.0m*) The change of ownership of Financial Objects took effect from 11 September and Board composition changed On 11 September Financial Objects was de-listed
Slide 5: Rationale for the deal
1. Transaction summary 2. Rationale for the deal – Max Chuard 3. Integration plan 4. Financial impact 5. Q&A Slide 5 13/11/2007
Slide 6: Enhances Temenos' position as the leading vendor in the market
Rationale for the deal Enhances Temenos’ position as the leading vendor in the market with addition of >50 core banking customers Adds important scale across the business as Combined entity well as complementary IP (e.g. in wealth better placed to management) exploit significant market opportunity C
Slide 7: Significant cost synergies and revenue potential; acquisition accretive
Rationale for the deal Significant cost synergies e.g. through removal of PLC costs Acquisition accretive Potential for significant revenue to earnings from the synergies through cross-selling and outset combining sales organisations in Northern Europe Slide 7 13/11/2007
Slide 8: Acquisitions – performance against objectives
Acquisitions – performance against objectives Acquisition Criteria Financial Objects Revenue USD 20-50m 2007 revenues of GBP 21.2m(USD38.2*) Accretive to earnings The transaction to be accretive from 2008 Strengthen distribution/delivery Strong presence in the UK & Nordics Acquire client base >50 ba
Slide 9: Integration plan
1. Transaction summary 2. Rationale for the deal 3. Integration plan – Andreas Andreades 4. Financial impact 5. Q&A Slide 9 13/11/2007
Slide 10: Future for the Financial Services Division
Future for the Financial Services Division Financial Objects has 2 banking products: IBIS Combined base of >50 activebank clients As well as wealth management products We have confirmed continued support for banking product range Key value proposition - to assist those Financial Objects customers wh
Slide 11: Future for other FO Divisions
Future for other FO Divisions Financial Objects has the following other divisions: Credit risk - c.25% of revenues Other software - c. 15% of revenues These divisions are both profitable and growing… … and represent a key part of the acquired product portfolio (but c.2.5% of total group revenues) Th
Slide 12: Financial impact
1. Transaction summary 2. Rationale for the deal 3. Integration plan 4. Financial impact – David Arnott 5. Q&A Slide 12 13/11/2007
Slide 13: 2008 impact from acquisition
2008 impact from acquisition We consolidate Financial Objects for period 11/9- 31/12 Expected to add USD11m to revenues and USD0.01 to adjusted EPS* We take a restructuring charge of USD1m… → We will have borne all the restructuring charges… → …and completed the restructuring exercise by the end of
Slide 14: Updated 2008 outlook
Updated 2008 outlook Financial Previous Objects Revised y-o-y Licences 176.5 +2 178.5 20% Revenue 433 +11 444 34% Costs 344.4 +11 355.4 EBIT 88.6 0.0 88.6 42% EBIT margin 20.5% - 20% +110bps Adjusted EPS* 1.39 +0.01 1.40 36% • We reiterate our outlook from Q2 and increase adjusted EPS by USD0.01 • S
Slide 15: 2009 contribution
2009 contribution USDm Cost synergies Revenue* 40.0 • Of the USD3.1m in 2009, Revenue synergies 0.0 USD1.3m represents PLC costs*** Revenue contribution 40.0 • Figure to rise to USD5m in Costs** (33.7) 2010 as remaining Cost synergies 3.1 synergies materialise EBITA 9.4 * Consensus estimate for reve
Slide 16: Revenue synergies to give further upside
Revenue synergies to give further upside No revenue synergies have been assumed in projections Nonetheless, there remains significant potential for revenue synergies: → Potential to sell T24 to Financial Objects customer base → Potential for selling wealth management functionality to T24 base These
Slide 17: Full 2009 impact
Full 2009 impact Revenue 40.0 An EBITA contribution of USD9.4m EBITA 9.4 …translates to a margin of EBITA margin 24% 24%... Interest charge 3.9 …and EPS accretion of USD0.08 Adjusted EPS 0.08 All amounts in USDm except EPS in USD
Slide 18: Q&A
1. Transaction summary 2. Rationale for the deal 3. Integration plan 4. Financial impact 5. Q&A Slide 18 13/11/2007