Iress Limited · ASX:IRE
Iress — ABN-AMRO Morgans Small Cap Conference 2003
23 slides from Iress's conference presentation, Sep 19, 2003
Slide 1: ABN-AMRO Morgans Small Cap Conference
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Slide 2: Underlying Results
iress MARKET TECHNOLOGY Underlying Results 8.7 8.9 8.757 8.780 7.4 4.5 * Excludes impact of Beacon amortisation charges & proposed IWL Ltd acquisition expenses # Excludes Xplan operating loss and acquisition related amortisation charges
Slide 3: IRESS — Historical Results
iress MARKET TECHNOLOGY IRESS — Historical Results (aqj) = @ Earnings = @PBT = | Ma Revenue | a 1998 1999 2000 2001 2002 2003
Slide 4: Revenue Analysis (excl Xplan)
iress MARKET TECHNOLOGY Revenue Analysis (excl Xplan) $ Million oN > OD wa 02-Q1 02-Q2 02-03 02-04 03-Q1 MIRESS Fee wiRESSFee MFTS&ETSFee DiOSFee @ Other Services @NewsRev @ Royalty Rev @ CommsRev @ Server H/ware
Slide 5: Operating Expenses (adj & excl Xplan)
iress MARKET TECHNOLOGY Operating Expenses (adj & excl Xpian) V7 7) y 7 yy ie ) $ million no oO FF OF DD “WS _ Wye, ; 7 yy ] y, | Co Vip | _. By 7) | 7 7 L _ iy . 1 : y J ) / a | yay Ly gg G&A B Occupancy O Comm sHardware @ Other Employee Costs W ages (incl incentives)
Slide 6: Headcount
iress MARKET TECHNOLOGY Headcount December 2002 Fin& Admin, 8 Dbase, 4 Devel, 31%. Dir, 4 Exec, 6 ; (I 7 — Xplan, 14 Fin& Admin, 8 Dbase, 4 June 2003
Slide 7: Diversified Revenue Base
iress MARKET TECHNOLOGY Diversified Revenue Base* 101+ 1 51 to 100 25 to 50 11 to 25 # Dissection of Total Revenues to June 2003 ranked by Client
Slide 8: XPLAN Capability Update
iress MARKET TECHNOLOGY XPLAN Capability Update => XPLAN sales, support and development capability now fully geared up and broadly capable of supporting our target market share. => Fully managed hosted service leveraging from existing IRESS infrastructure a first for the wealth management industry.
Slide 9: XPLAN Prospects
iress MARKET TECHNOLOGY XPLAN Prospects > Post the IPS release, the sales and installation process now in full swing. > Over 30 contracts signed in the last few months including two large dealer groups. > Aggressive pricing responses and rushed product announcements from incumbents validate our stra
Slide 10: IRESS / XPLAN Dealer Group Solution
iress MARKET TECHNOLOGY IRESS / XPLAN Dealer Group Solution Online Online Full Service Full Service i Platform Broker 1 Broker 2 Broker 1 Broker 2 i Interface ° ” o ” Executions out -* Direct and Lee - Future Transaction Managed o janagemen Orders in IRESS a” Interface | Routing | HUB “ee Platform F
Slide 11: ASX Volume by Broker Type
iress MARKET TECHNOLOGY ASX Volume by Broker Type 180 + Full Service + Institutional -- Online 160 140 120 100 80 60 Jan- Feb- Mar- Apr- May- Jun- Jul Aug- Sep- Oct- Nov- Dec- Jan- Feb- Mar- Apr- May- Jun- Jul- Aug- Sep- 02 #02 O02 02 02 #02 O02 02 02 02 O02 02 O38 03 O38 03 O03 03 03 03 03
Slide 12: Core Business Trading in 2003
iress MARKET TECHNOLOGY Core Business Trading in 2003 > Clear pickup in sentiment amongst our client base over recent months. Strongest in on-line broking but has filtered through to full service. > Impact on IRESS usually lagged given correlation to head count not trades. However a reduction in mer
Slide 13: The Competition Issue
iress MARKET TECHNOLOGY The Competition Issue » Increased competition in our core business has been now been widely flagged for over eighteen months. > Several new solution now released (supposedly) but impact to date remains very modest and dwarfed by broader industry issues. > GBST continues to be
Slide 14: Barriers To Entry
iress MARKET TECHNOLOGY Barriers To Entry > Very strong barriers exist in all institutional clients given the entrenched transaction network. New entrants can only attack basic retail brokers and even then at large firms (with insto operations) the marginal pricing advantage is tiny. This leaves onl
Slide 15: Retail Broking Middleware
iress MARKET TECHNOLOGY Retail Broking Middleware A Critical Value Add Opportunity > International trends point to full service retail broking migrating to a comprehensive adviser platform driven by: » » » > Compliance Efficiency Scalability Expansion of product set / wealth management focus > Speci
Slide 16: IRESS Unique Retail Broking Solution
iress MARKET TECHNOLOGY IRESS Unique Retail Broking Solution Broker Adviser Platform Planner Adviser Platform IRESS / 10S Premium market data Real-time execution FSRA Order Management —<—> Multi-market vetting Operator / supervisor contro! Asset summary Broker level CRM IPS Portfolio Management XPLA
Slide 17: Why Middleware?
LeSS Why Middleware? How Does a Back Office Solution Compare? Is the currently accepted system of record Offers tight link to back office (for equities only) Often holds equity portfolio information x Focus is single asset class (against wealth management) x Not typically a “real time” environment o
Slide 18: Core Business Opportunities: A Highly Connected Infrastructure
iress MARKET TECHNOLOGY Fund Managers -FTS - IRESS - 1OS (access) Fix Connections Brokers -10S - IRESS - IPS Lk AGING, COONS. unl Core Business Opportunities A Highly Connected Infrastructure Custodians - ETC’s via |OS/Swift - ETC’s via Swift —t IRESS HUB Orders Reports Bookings Confirmations Holdin
Slide 19: IRESS Australian Business
iress MARKET TECHNOLOGY IRESS Australian Business Many Opportunities to Leverage the Network > New Zealand IOS. >» NZ Exchange releasing open interface in November. > IRESS only initial accredited vendor > Good existing IOS use in NZ will support sales > FIX Order Interface > Strong growth in FIX co
Slide 20: Electronic Trade Confirmations (ETC's)
IfESS|| Electronic Trade Confirmations (ETC’s) Community of Support Established > IOS ETC module released now in active use by trial participants. > Number of key fund managers have committed to IRESS ETC’s over OASYS. > Most major brokers have or are in the process of integrating their back office
Slide 21: Medium Term Growth for IRESS?
jress Medium Term Growth for IRESS? MARKET TECHNOLOGY => XPLAN progressing well and we remain confident of strong growth over coming years. > Despite high market share we continue to see growth opportunities to further leverage our strong and widening industry connectivity. => While not overly inter
Slide 22: Capital Management
iress MARKET TECHNOLOGY Capital Management > Strong (lazy?) balance sheet. $20 million in cash, no debt and strong cash flow. = Announced buy back not active at current prices. No shares have been purchased. > Medium term capital requirements being determined and if appropriate the board will consid
Slide 23: mess
iress MARKET TECHNOLOGY mess MARKET TECHNOLOGY