Iress Limited · ASX:IRE
Iress — Investor Presentation (June 2020)
37 slides from Iress's investor presentation, Jun 1, 2020
Slide 1: Equity raising & Acquisition of OneVue
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Equity raising & Acquisition of OneVue Investor presentation 1 June 2020
Slide 2: Contents
Contents Equity raising 03 Acquisition of OneVue 08 Appendices 14 Andrew Walsh John Harris Managing Director & CEO Chief Financial Officer NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES 2
Slide 3: Equity raising
Equity raising NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES 3
Slide 4: Raising targeting $170m via an institutional placement and SPP
Raising targeting $170m via an institutional placement and SPP Equity raising to further strengthen Iress’ position in the current environment, and provide flexibility for opportunities Equity raising targeting Conservative approach Increased headroom $170m Equity raising will further strengthen Avai
Slide 5: Equity raising to further strengthen balance sheet and provide flexibility
Equity raising to further strengthen balance sheet and provide flexibility Additional liquidity Placement $150m SPP1 $20m Total cash from equity raise $170m Extension of debt facility $105m Total additional liquidity $275m Investments and costs Equity value of OVH $107m2 Acquisition transaction costs
Slide 6: Update on 2020 financial performance
Update on 2020 financial performance YTD Change Segment ($AUDm) 1H FY April 2020 YTD YTD April ● Iress continues to operate and support all services to clients and 2019 2019 April 2019 users. Year to date, Iress has performed in line with previously (Unaudited) 2020 v pcp guided expectations and has
Slide 7: Raising targeting $170m via a placement and SPP
Raising targeting $170m via a placement and SPP Offer size ● Fully underwritten institutional placement to raise approximately $150m (the “Placement”) ● Approximately 14.4m new fully paid ordinary shares to be issued to sophisticated and institutional investors under the Placement (the “Placement Sh
Slide 8: Acquisition of OneVue
Acquisition of OneVue NOT FOR DISTRIBUTION OR RELEASE 8 IN THE UNITED STATES
Slide 9: Proposed acquisition of OneVue via Scheme of Arrangement
Proposed acquisition of OneVue via Scheme of Arrangement Structure Consideration Transaction premium Iress to acquire 100% of the Consideration to OneVue outstanding shares of shareholders of 40 cents per OneVue via scheme of share which equates to an arrangement implied equity value of Spot2 67% ap
Slide 10: Strategic acquisition supports growth in changing market
Strategic acquisition supports growth in changing market Technology and innovation core to Iress’ growth strategy Structural shifts and changing market dynamics presents opportunities Scale in funds Leverage Iress’ strength in Delivers long-term administration software and data shareholder value One
Slide 11: OneVue: Administration for fund managers, super funds & investors
OneVue: Administration for fund managers, super funds & investors Managed Funds Superannuation Investments Largest single third-party fund Third-party administration White-labelled online investment Overview registry in Australia by FUA services solutions Proprietary technology & highly automated Co
Slide 12: OneVue financial performance and impact
OneVue financial performance and impact OneVue Reported P&L FY19 5 1H20 Iress financial impacts ● Differences in accounting policies, particularly the treatment Services revenue 1 $49.6m $24.3m of internal software development costs, would have resulted in an EBITDA loss in FY19 in Iress’ hands EBITDA
Slide 13: Matters relating to Sargon
Matters relating to Sargon ● Iress has conducted extensive due diligence on OneVue and its business and has considered the implications of OneVue’s claims to the Sargon receivables and the surrounding arrangements. As previously announced by OneVue, it has significantly written down the value of thos
Slide 14: Appendices
Appendices 14 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 15: Equity raising timeline
Equity raising timeline Record date for SPP 7pm (Sydney time), Friday 29 May 2020 Iress enters trading halt, Placement and the SPP announced Monday 1 June Placement bookbuild Monday 1 June Announcement of the outcome of the Placement Tuesday 2 June Trading half lifted Tuesday 2 June Settlement of th
Slide 16: Key risks
Key risks NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES 16
Slide 17: Introduction
Introduction Investors should be aware that there are risks associated with an investment in Iress. Some of the principal factors that may, either individually or in combination, affect the future operating and financial performance of Iress and the value of Iress shares (before and after the propose
Slide 18: Acquisition risks
Acquisition risks Integration risk The Acquisition involves the integration of the OneVue business, which has previously operated independently to Iress. Consequently, there is a risk that the integration of the OneVue business (in particular, the integration of employees, corporate culture and info
Slide 19: Acquisition risks
Acquisition risks Completion risk The Acquisition is proposed to take place by way of a scheme of arrangement between OneVue and its shareholders. There is a risk that the acquisition of OneVue may not complete due to a failure to satisfy customary conditions precedent to implementation of a scheme
Slide 20: Operational risks
Operational risks Domestic and global economic conditions Adverse changes in economic conditions can impact client expenditure and accordingly, client demand for Iress’ systems. In light of recent global macroeconomic events, including the impact of the COVID-19 pandemic, it is likely that some of t
Slide 21: Operational risks
Operational risks Technology Given the rate of change within the industries in which Iress operates, it is key to Iress’ performance that it can ensure its systems meet and satisfy clients’ requirements, via proprietary and third-party intellectual property and technology. If Iress cannot keep abrea
Slide 22: Operational risks
Operational risks Consolidation in client industries Consolidation in the industries in which Iress' clients operate may reduce Iress’ attainable market and bargaining power with clients that may lead to Iress transacting at less advantageous financial terms with those clients. Dislocation in Austral
Slide 23: General risks
General risks Market Investors should be aware that there are risks associated with any investment in a company listed on ASX. The market value of Iress shares will fluctuate depending on the price at which Iress shares are traded on ASX, and may rise above or below the current Iress share price depe
Slide 24: General risks
General risks Allocation of Placement Shares It is intended that eligible institutional shareholders who bid for an amount less than or equal to their ‘pro rata’ share of Placement Shares will be allocated their full bid on a best endeavours basis. For this purpose, an eligible institutional shareho
Slide 25: General risks
General risks The Placement may not be fully underwritten and may not complete Iress has entered into an underwriting agreement with the Underwriter under which the Underwriter has agreed to fully underwrite the Placement, subject to the terms and conditions of that agreement (the “ Underwriting Agr
Slide 26: General risks
General risks ...contd ● a condition precedent is not satisfied or waived by the Underwriter by its applicable deadline; ● there is a material adverse change (or development involving a potential material adverse change) in the condition, assets, liabilities, financial or trading position or performan
Slide 27: International offer restrictions
International offer restrictions NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES 27
Slide 28: International offer restrictions
International offer restrictions This document does not constitute an offer of Placement Shares in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, and the Placement Shares may not be offered or sold in the Placement, in any country o
Slide 29: International offer restrictions
International offer restrictions The following is a summary of the statutory rights of rescission or to damages, or both, available to purchasers in Ontario. In Ontario, every purchaser of the Placement Shares purchased pursuant to this document (other than (a) a "Canadian financial institution" or a
Slide 30: International offer restrictions
International offer restrictions New Zealand This document has not been registered, filed with or approved by any New Zealand regulatory authority under the Financial Markets Conduct Act 2013 (the "FMC Act"). The Placement Shares are not being offered or sold in New Zealand (or allotted with a view t
Slide 31: International offer restrictions
International offer restrictions United Arab Emirates This document does not constitute a public offer of securities in the United Arab Emirates and the Placement Shares may not be offered or sold, directly or indirectly, to the public in the UAE. Neither this document nor the Placement Shares have
Slide 32: Disclaimers
Disclaimers NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES 32
Slide 33: Important notice and disclaimer
Important notice and disclaimer This investor presentation (“Presentation”) has been prepared by Iress Limited (ACN 060 313 359) (“Iress”). This Presentation has been prepared in relation to a proposed equity raising by Iress by way of an institutional placement (“Placement”) of new fully paid Iress
Slide 34: Important notice and disclaimer
Important notice and disclaimer Effect of rounding A number of figures, amounts, percentages, estimates, calculations of value and fractions in this Presentation are subject to the effect of rounding. Accordingly, the actual calculation of these figures may differ from the figures set out in this Prese
Slide 35: Important notice and disclaimer
Important notice and disclaimer Not an offer This Presentation is not and should not be considered an offer or an invitation to acquire New Shares or any other financial products in any jurisdiction in which, or to any person to whom, it would be unlawful to make such an offer or invitation. In parti
Slide 36: Important notice and disclaimer
Important notice and disclaimer In connection with the Placement, one or more investors may elect to acquire an economic interest in the New Shares (“Economic Interest”), instead of subscribing for or acquiring the legal or beneficial interest in those shares. The underwriter (or its affiliates) may, f
Slide 37: Contact
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES Contact Andrew Walsh, CEO John Harris, CFO +61 3 9018 5800 iress.com