Eplus Inc. · NASDAQ:PLUS
Eplus — Investor Presentation (August 2019)
29 slides from Eplus's investor presentation, August 2019
Slide 1: Investor Presentation
ePlus inc. Investor Presentation August 2019 © 2019 ePlus inc.
Slide 2: Safe Harbor Statement
Safe Harbor Statement Statements in this presentation that are not historical facts may be deemed to be "forward-looking statements." Actual and anticipated future results may vary materially due to certain risks and uncertainties, including, without limitation, possible adverse effects resulting fr
Slide 3: Mark Marron, Chief Executive Officer
Mark Marron Chief Executive Officer © 2019 ePlus inc. I 3
Slide 4: ePlus at a Glance
ePlus at a Glance + Leading provider of technology solutions focused on cloud, security, and digital infrastructure + Technology partners include Cisco, Dell Technologies, HPE, NetApp, Palo Alto Networks and VMware + FY19 adjusted gross billings: $1.9 billion 7% CAGR FY15-FY19 + FY19 net sales: $1
Slide 5: Experienced Leadership Team
Experienced Leadership Team Mark Elaine Darren Marron Marion Raiguel Chief Executive Officer Chief Financial Officer Chief Operating Officer, Joined ePlus in 2005 Joined ePlus in 1998 President of ePlus 30+ Years of Experience 25+ Years of Experience Technology, inc. Joined ePlus in 1997 25+ Years o
Slide 6: Well Positioned within the IT Ecosystem
Well Positioned within the IT Ecosystem Our range of complex solutions and services places us in high end of the IT market Vendors Distributors VARs IT Solutions Services/Integrators 25 – 65% GM 5 – 13% GM 13 – 16% GM 20 – 25% GM 29 – 32% GM GROSS MARGIN 1 INCREASING CUSTOMER VALUE AND VENDOR MARGIN
Slide 7: Expanding Footprint
Expanding Footprint ENGLAND INDIA INTERNATIONAL OFFICES REGIONAL OFFICE SALES OFFICES MANAGED SERVICES CENTERS INTEGRATION CENTERS 40+ locations serving the U.S., Europe, and Asia-Pac 24/7 365 managed services operations and integration centers strategically placed throughout the U.S. 650+ technical
Slide 8: Targeted M&A Strategy with Track Record of Success
Targeted M&A Strategy with Track Record of Success + January 2019 + September 2017 + May 2017 + December 2016 (division of CCI) + Southern and central Virginia + Chicago and Indianapolis data + Cloud-based services, solutions + Minneapolis, MN Cisco VAR centers and DevOps + Security managed services
Slide 9: Customized Solutions
Customized Solutions Positioned squarely at the forefront of today’s most transformative technologies… Cloud Security Digital Infrastructure Services Financing and Consumption Models Create customized Deliver cybersecurity Support the next phase Apply a lifecycle roadmaps, then programs built upon o
Slide 10: Measurable Results
Measurable Results ePlus helps organizations imagine, implement, and achieve more from technology. Cloud Security Digital Infrastructure Services Financing and Consumption Models Enterprise Defined Strategy and Risk IoT and Analytics Enhanced Maintenance Data Center Management SD-WAN Support As-a-Se
Slide 11: Independent Provider with Deep Strategic Relationships
Independent Provider with Deep Strategic Relationships SELECTED STRATEGIC PARTNERS + Excellent channel partner for ePlus, representing 42% of technology segment net sales 1 COMPLEMENTED BY ADDITIONAL RELATIONSHIPS + All core products plus data center, security, lifecycle services, and Cisco One/soft
Slide 12: Broad and Diverse Customer Base
Broad and Diverse Customer Base 1 1 Trailing twelve months ended 6/30/2019 21% 17% 14% 15% 15% 18% GOVERNMENT TELECOM, FINANCIAL TECHNOLOGY ENTERTAINMENT, HEALTHCARE OTHER & EDUCATION SERVICES & MEDIA © 2019 ePlus inc. I 12
Slide 13: Sampling of Our Customers
Sampling of Our Customers TELECOM, GOVERNMENT & FINANCIAL TECHNOLOGY ENTERTAINMENT HEALTHCARE OTHER EDUCATION SERVICES & MEDIA ©© 2019 ePlus 2019 ePlusinc. inc. I 13
Slide 14: Why ePlus
Why ePlus In today’s constantly changing, complex tech landscape, organizations need a partner that can solve short-term challenges with sustainable solutions that ensure long-term success. “Do what it takes” Industry-leading Comprehensive Proven processes Highly-accessible, dedication consultative
Slide 15: Elaine Marion, Chief Financial Officer
Elaine Marion Chief Financial Officer © 2019 ePlus inc. I 15
Slide 16: Strong Financial Results
Strong Financial Results FYE March 31 / Trailing twelve months ended June 30, unaudited Net Sales and Adjusted Gross Billings * ($mm) + Operations are conducted through two segments. The technology segment sells information $2,400 40.0% technology products, software and services, while $1,985 the fi
Slide 17: Strong Financial Results
Strong Financial Results FYE March 31 / Trailing twelve months ended June 30, unaudited Service Revenue ($mm) + Service revenue includes professional services, managed services, and staffing services. $200 20.0% + From FY17 to FY19, service revenue has increased $162 at a compound annual rate of 24%
Slide 18: Strong Financial Results
Strong Financial Results FYE March 31 / Trailing twelve months ended June 30, unaudited Gross Profit and Gross Margin ($mm) + Consolidated gross profit increased at a compounded annual rate of 8% from FY15 to $400 35.0% FY19, driven by our technology segment, which $342 $323 $330 $327 represented 89
Slide 19: Strong Financial Results
Strong Financial Results FYE March 31 / Trailing twelve months ended June 30, unaudited Net Earnings and Non-GAAP Net Earnings * ($mm) + From FY15 to FY19, net earnings increased at a $100 compounded annual rate of 8% as a result of $80 focusing on revenue and gross profit growth. $60 + EPS and non-
Slide 20: Q1 FY20 Financial Results
Q1 FY20 Financial Results Net Sales and Adjusted Gross Billings * ($mm) Gross Profit and Gross Margin ($mm) $650 $150 35.0% $548.4 $550 $92.6 30.0% $482.3 $100 $80.7 $450 25.0% $356.5 $381.4 $50 24.3% $350 22.6% 20.0% $250 $0 15.0% 1Q19 1Q20 1Q19 1Q20 Net Sales, Technology Net Sales, Financing Adjus
Slide 21: Growing Customer Facing Personnel
Growing Customer Facing Personnel Employee Headcount Growth by Function + Acquiring consultative sales professionals to 1,800 bring successful business outcomes to our 1,537 1,600 7 customers. 1,400 313 + Focused on growing engineering talent in 1,200 986 8 cloud, security, and digital infrastructur
Slide 22: Strong Balance Sheet
Strong Balance Sheet $ in millions + $36 million in cash and equivalents as a Assets June 30, 2019 March 31, 2019 result of the change in working capital and Ca s h a nd equi va l ents $ 36 $ 80 Accounts recei va bl e 408 342 repurchases of our common stock Inventory 58 50 Fi na nci ng i nves tments
Slide 23: Customized Solutions. Measurable Results. Q & A
Customized Solutions. Measurable Results. Cloud Positioned squarely at the forefront of today’s most Data Center transformative technologies, ePlus’ solutions, services, and financing expertise help organizations imagine, Security implement, and achieve more from technology. Networking … Q&A … Colla
Slide 24: Appendix
Appendix © 2019 ePlus inc. I 24
Slide 25: Non-GAAP Financial Information
Non-GAAP Financial Information $ in thousands Year Ended March 31, TTM Ended June 30, 2019 2018 2017 2016 2015 2019 2018 Technol ogy s egment net s a l es [1] $ 1,329,520 $ 1,372,765 $ 1,294,937 $ 1,169,065 $ 1,108,449 $ 1,351,191 $ 1,356,730 Cos ts i ncurred rel a ted to s a l es of thi rd-pa rty m
Slide 26: Non-GAAP Financial Information
Non-GAAP Financial Information $ in thousands, except per share information Year Ended March 31, TTM Ended June 30, 2019 2018 2017 2016 2015 2019 2018 GAAP: Earnings before tax $ 86,230 $ 83,891 $ 86,112 $ 75,751 $ 78,313 $ 88,378 $ 83,681 Share based compensation 7,244 6,464 6,025 5,711 4,585 7,493
Slide 27: Non-GAAP Financial Information
Non-GAAP Financial Information $ in thousands, except per share information Three Months Ended June 30, 2019 2018 Technol ogy s egment net s a l es $ 368,535 $ 346,864 Cos ts i ncurred rel a ted to s a l es of thi rd-pa rty ma i ntena nce, s oftwa re a s s ura nce a nd s ubs ci rpti on/Sa a S l i ce
Slide 28: Return on Invested Capital
Return on Invested Capital $ in thousands Year Ended March 31, TTM Ended June 30, 2019 2018 2017 2016 2015 2019 2018 Numerator Operating income $ 79,534 $ 84,239 $ 85,732 $ 75,751 $ 70,710 $ 81,824 $ 84,204 Less: Taxes [1] (21,236) (28,894) (35,407) (30,982) (29,345) (22,502) (26,861) Net operating
Slide 29: Investor Relations
Investor Relations ePlus inc. Kley Parkhurst, SVP 13595 Dulles Technology Drive Herndon, VA 20171-3413 (703) 984-8150 (703) 984-8400 / eplus.com investors@eplus.com ©2019 ePlus inc. All rights reserved. ePlus, the ePlus logo, and all referenced product names are trademarks or registered trademarks o