Slide 1: 2018 Full Year Results
2018 FULL YEAR RESULTS May 2019
Slide 2: Presentation Team
PRESENTATION TEAM CEO CFO Non-Executive Chairman Nichole Stella Graeme Couturier Peter Hallett • Experienced career US Promo industry • Previously CFO at Sorted Group, • Experienced public company director professional a PE backed business in the delivery • Former CFO of Redstone plc (now • 14 years
Slide 3: Overview – Business Update
OVERVIEW – BUSINESS UPDATE Nichole Stella Chief Executive Officer 4 | ALTITUDE Nevada Presentation
Slide 4: A Busy and Transformative Year
A BUSY AND TRANSFORMATIVE YEAR Considerable progress strategically, operationally and financially A year of change • Management $870K • Board Focused on enhancing and developing relationship with AI Mastermind (AIM), the largest and fastest growing promotional products distributor group in the US Co
Slide 5: AIM Acquisition
AIM ACQUISITION 4 | ALTITUDE Nevada Presentation
Slide 6: Why We Acquired AIM
WHY WE ACQUIRED AIM ENABLE ALTITUDE TO CONTROL & MONETISE THE ENTIRE $1.9BN PIPELINE IN PERPETUITY • Secures the $1.9bn pipeline for monetisation • Enables ALT to leverage the entire AIM order flow in partnership with selected contracted Preferred Suppliers, regardless of whether the order is placed
Slide 7: Competitive Landscape
COMPETITIVE LANDSCAPE AIM is by far the largest PPD member group by gross revenue in the USA (c. 8% Market Share) AIM members love AIM because… • “Free” Technology AIM Tech Suite $608m $592m No membership model No membership model • End Quantity Pricing from AIM Preferred Suppliers • Discounts on: $
Slide 8: AIM Overview - A Transformative Deal
AIM OVERVIEW - A TRANSFORMATIVE DEAL AIM is the largest and fastest growing distributor group in the U.S. AIM MEMBERS AVERAGE MEMBER GROSS MEMBERSHIP SALES Reach across all US states & territories and REVENUE $1.9 Billion pa Canada on average 30+ new members joining per month (2018: $1.7bn) Sales 20
Slide 9: Revenue Cycle
REVENUE CYCLE Fees Captured from both Member & Supplier Across All Orders TIERED MEMBER BENEFITS & SERVICES & AGREEMENTS WITH SUPPLIER PARTNERS 149 Key Supplier Partners Signed & Participating Standard AIM Membership $59 per month Agency Pro – Marketing & Creative Solution Tech Pro – Technology Solu
Slide 10: Contracting Preferred Suppliers Progress
CONTRACTING PREFERRED SUPPLIERS PROGRESS Contracting Suppliers for the whole pipeline SUPPLIERS –– WHY DO THEY WANT IN? They gain access to the group & we heavily market their products and services by featuring them on the technology platform, in our publication, webinars, social posts to End-buyers
Slide 11: Membership Progress
MEMBERSHIP PROGRESS AIM MEMBER – WHY DO THEY WANT IN? Because we enable them to compete with large companies. They receive incredible supplier products and pricing, healthcare, top technology & marketing tools that give them the ability to work, look and behave like they belong to a Fortune 500 comp
Slide 12: AIM Member Transaction Visibility
AIM MEMBER TRANSACTION VISIBILITY Revenue no longer reliant on AIMPro throughput KEY POINTS Synched through AIMPro Platform • Monetisation no longer reliant on AIMPro usage Sales Order Value 20 weeks 2019 $31.1m Weekly average $2m in April • Tech underpins everything and is “sticky” Sales Order Valu
Slide 13: Revenue from Enhanced Member Services
REVENUE FROM ENHANCED MEMBER SERVICES No Total Fees pa Recruit Partner AIM REV $59 AIM membership Fee CURRENT Current members 2,108 $1.5m $1.0m $0.5m Current member benefits package TIER 1 - Included in $59AIM POTENTIAL membership Fee Run Rate Revenue $0.5m Current member benefits package Blended %
Slide 14: AIM Since Acquisition
AIM SINCE ACQUISITION In the 4 months since the acquisition of AIM we have: • Successfully integrated AIM, renamed AIM Smarter, with a focus on accelerating and growing the US business • Expanded the US team • Formalized agreements with 149 suppliers as part of the Preferred Supplier Programme • Add
Slide 15: Financial Review
FINANCIAL REVIEW Graeme Couturier Chief Financial Officer 4 | ALTITUDE Nevada Presentation
Slide 16: Altitude Financials (Unaudited) – Income Statement
ALTITUDE FINANCIALS (UNAUDITED) INCOME STATEMENT 2018 2017 VARIANCE Fav/(Adv) £m £m £m % Revenue 6.6 6.0 0.6 10% • Revenue Movement: Gross Profit 4.0 4.3 (0.3) (8%) • Full year revenue from ADP £1.6m (2018 7 months) • First time throughput revenue £0.1m 61% 72% • Expiration of US legacy SaaS contrac
Slide 17: Altitude Financials (Unaudited) – Cashflow Statement
ALTITUDE FINANCIALS (UNAUDITED) CASHFLOW STATEMENT 2018 2017 VARIANCE £m £m £m • Operating cash outflow of (£0.8m) largely Profit after tax (2.3) 0.1 (2.9) reflects £0.9m US scale up of operations Amortisation and depreciation 0.8 0.4 0.4 • Investment in working capital arises Share based payments 0
Slide 18: Altitude Financials (Unaudited) – Balance Sheet
ALTITUDE FINANCIALS (UNAUDITED) BALANCE SHEET 2018 2017 £m £m Tangible fixed assets 0.3 0.1 • Prudent capitalization/amortization Intangible assets 1.7 1.6 of Intangible assets Deferred tax asset 0.4 0.4 • Balance sheet ungeared, no Bank Current assets: borrowings Inventory 1.7 1.5 Trade & other rec
Slide 19: Potential Change of Year End
POTENTIAL CHANGE OF YEAR END* • From 31 December to 31 March • 15 month accounting period 2019/20 • 31 March more in line with US promotional products industry • Better cut off date for auditable visibility of calendar year supplier revenue • Interims to 30 June reported as normal in September/Octob
Slide 20: Funding Growth
FUNDING GROWTH • February 2018: Development fundraise £1.5m @ 60p • 2.5m shares • to develop the relationship with AIM and to roll out AIMPro • January 2019: Acquisition fundraise £9m @ 68p • 13.2m shares issued for cash • 0.9m consideration shares to vendor • to finance the Acquisition of AIM • to
Slide 21: Outlook & Summary
OUTLOOK & SUMMARY Nichole Stella Chief Executive Officer 4 | ALTITUDE Nevada Presentation
Slide 22: Future Focus
FUTURE FOCUS • Continued investment in US resource personnel • Staff numbers now 32 rising to c.40 by the year end 2019 • Building high quality team • Distributor Members • Based on Member Feedback - Tiered ‘beta’ packages launched in March, with full launch in April, full marketing has just begun w
Slide 23: Executive Summary
EXECUTIVE SUMMARY • Focused on enhancing and developing relationship with AI Mastermind (AIM), the largest and fastest growing promotional products distributor group in the US • Completed transformative acquisition of AIM for $5.0 million • Successfully integrated the business under one brand – “AIM
Slide 24: Q&A
Q&A 25 | ALTITUDE Nevada Presentation
Slide 25: Appendix
APPENDIX 25 | ALTITUDE Nevada Presentation
Slide 26: Market Overview
MARKET OVERVIEW 4 | ALTITUDE Nevada Presentation
Slide 27: Promotional Products - Supply Chain Overview
PROMOTIONAL PRODUCTS - SUPPLY CHAIN OVERVIEW Where we add value Altitude Group plc provides a patented technology platform (ChannlPro) to distributors which has a supply chain already built in and combines an e-commerce trading platform with a cloud based CRM and order management system Manufacturer
Slide 28: US Promotional Products Market
US PROMOTIONAL PRODUCTS MARKET Gaining traction in US Market A highly fragmented market • Perceived largest player 4Imprint - less than 3% market share USA • 42% of market (~$9.8bn) conducted by 22,700 distributors with revenues <$2.5m pa* Current market size $23bn* And an inefficient market structu
Slide 29: Thank You
THANK YOU 27 | ALTITUDE Nevada Presentation