Megaport Ltd. · ASX:MP1
Megaport — Investor Presentation (February 2023)
33 slides from Megaport's investor presentation, Feb 9, 2023
Slide 1: Market Update 1HFY23 Half Year Results
MARKET UPDATE 1HFY23 HALF YEAR RESULTS
Slide 2: Company Highlights 1HFY23
COMPANY FINANCIAL BUSINESS CHANNEL SECOND HALF HIGHLIGHTS PERFORMANCE UPDATE UPDATE EXECUTION COMPANY HIGHLIGHTS 1HFY23
Slide 3: Revenue Performance 1HFY23 (AUD)
COMPANY HIGHLIGHTS REVENUE PERFORMANCE 1HFY23 (AUD) North America Asia Pacific Europe Global 1HFY23 1HFY23 1HFY23 1HFY23 $39.5M $20.3M $10.9M $70.7M $12.9M 48% $4.5M 28% $2.1M 24% $19.5M 38% 1HFY22: $26.6M 1HFY22: $15.8M 1HFY22: $8.8M 1HFY22: $51.2M PAGE 3
Slide 4: Highlights 1HFY23 (AUD)
COMPANY HIGHLIGHTS HIGHLIGHTS 1HFY23 (AUD) +16% +15% +4% Monthly Recurring Revenue1 Annualised Revenue2 Total Number of Customers $10.7M $12.4M $128.3M $148.0M 2,643 2,739 30 JUNE 2022 31 DECEMBER 2022 30 JUNE 2022 31 DECEMBER 2022 30 JUNE 2022 31 DECEMBER 2022 +6% +3% +5% Total Number of Services3
Slide 5: Highlights 1HFY23 (AUD)
COMPANY HIGHLIGHTS HIGHLIGHTS 1HFY23 (AUD) 30 JUNE 2022 31 DECEMBER 2022 Total Customers Group Exit Gross Margin Cloud Onramps 2,643 2,739 APAC 77% EMEA 76% NAM 64% MP1 69% 3.61 Average Ports per Customer 3.69 1 Natural margin growth enhanced by 4 282 NEW TOTAL active cost & price management. Averag
Slide 6: Asia Pacific (AUD)
REGIONAL HIGHLIGHTS ASIA PACIFIC (AUD) Total Installed Data Centres Total Number of Customers Average Revenue per Port3 108 108 1,003 1,015 $974 +3% 30 JUNE 2022 31 DEC 2022 30 JUNE 2022 31 DEC 2022 No. of Ports per Data Centre 32.3 - Total Number of Ports Total Number of Services 1 Services per Por
Slide 7: Asia Pacific Financial Performance (AUD)
REGIONAL HIGHLIGHTS ASIA PACIFIC FINANCIAL PERFORMANCE (AUD) MARGIN TRENDS1 APAC A$M1 APAC profit after direct network costs margin continues to grow with increasing MRR, and direct network costs remaining steady. The EBITDA return remains strong at >50% with operating costs up marginally for the re
Slide 8: Europe (AUD)
REGIONAL HIGHLIGHTS EUROPE (AUD) Total Installed Data Centres Total Number of Customers Average Revenue per Port3 105 105 531 551 $1,361 +13% 30 JUNE 2022 31 DEC 2022 30 JUNE 2022 31 DEC 2022 No. of Ports per Data Centre 13.5 - Total Number of Ports Total Number of Services 1 Services per Port 1,414
Slide 9: Europe Financial Performance (AUD)
REGIONAL HIGHLIGHTS EUROPE FINANCIAL PERFORMANCE (AUD) EMEA A$M1 MARGIN TRENDS1 EMEA EBITDA continues to be positive for the 1HFY23. EMEA continues to be in a strong position for growth via indirect channels. EMEA EBITDA margin remains steady, showcasing the cost control efforts across the group, wh
Slide 10: North America (AUD)
REGIONAL HIGHLIGHTS NORTH AMERICA (AUD) Total Installed Data Centres Total Number of Customers Average Revenue per Port3 $1,437 +17% 210 210 1,462 1,536 30 JUNE 2022 31 DEC 2022 30 JUNE 2022 31 DEC 2022 No. of Ports per Data Centre 23.4 +6% Total Number of Ports Total Number of Services1 Services pe
Slide 11: North America Financial Performance (AUD)
REGIONAL HIGHLIGHTS NORTH AMERICA FINANCIAL PERFORMANCE (AUD) NAM A$M1 MARGIN TRENDS1 Slower network expansion, now at scale has allowed operating leverage to deliver strong margin growth. Direct network costs for Mexico are included in December 2022, which are offset by the reductions in direct net
Slide 12: Financial Performance 1HFY23
COMPANY FINANCIAL BUSINESS CHANNEL SECOND HALF HIGHLIGHTS PERFORMANCE UPDATE UPDATE EXECUTION FINANCIAL PERFORMANCE 1HFY23
Slide 13: Revenue (AUD)
FINANCIAL PERFORMANCE REVENUE (AUD) FINANCIAL RESULTS FOR HALF YEAR ENDED 31 DECEMBER 2022 1HFY23 1HFY22 Revenue of $70.7M, up 38%, driven by customer growth and service uptake across all regions. $20.3M $15.8M 29% 31% NAM showcased the largest growth across all regions, increasing $12.9M $39.5M $26
Slide 14: Financial Results (AUD)
FINANCIAL PERFORMANCE FINANCIAL RESULTS (AUD) FINANCIAL RESULTS FOR HALF YEAR ENDED 31 DECEMBER 2022 1HFY23 1HFY22 Change Consolidated Profit & Loss $’M $’M % Revenue $70.7M up 38% v 1HFY22 Revenue 70.7 51.2 38% Direct network costs increased by Direct network costs (16.2) (14.8) (9%) $1.4M (9%) wit
Slide 15: Operating Costs (AUD)
FINANCIAL PERFORMANCE OPERATING COSTS (AUD) FINANCIAL RESULTS 1HFY23 1HFY22 Change FOR HALF YEAR ENDED 31 DECEMBER 2022 $’M $’M % Direct network costs 16.2 14.8 (9%) Average network cost per data centre per month increased 5% to $6.3K in Partner commissions 8.0 5.5 (45%) H1FY23 ($6.0K in H1FY22) lar
Slide 16: Cash Flow (AUD)
FINANCIAL PERFORMANCE CASH FLOW (AUD) FINANCIAL RESULTS 1HYF23 1HFY22 YoY FOR HALF YEAR ENDED 31 DECEMBER 2022 $’M $’M % Cash flow from operations was an Normalised EBITDA1 3.4 (7.3) 147% inflow of $1.4M, following the transition into EBITDA positive Working Capital (2.0) (0.3) (567%) trading. Cash
Slide 17: EBITDA Journey (AUD)
FINANCIAL PERFORMANCE EBITDA JOURNEY (AUD) FINANCIAL RESULTS FOR HALF YEAR ENDED 31 DECEMBER 2022 “Scale Up, Scale Out” Business was tracking to profitability throughout FY21, achieving EBITDA breakeven in the month of June ‘21. Reinvestment in the business as Scale Up, Scale Out: building an indire
Slide 18: Historical Financial Performance (AUD)
FINANCIAL PERFORMANCE HISTORICAL FINANCIAL PERFORMANCE (AUD) MARGIN TRENDS Group EBITDA positive in the first half of FY23, continuing the positive momentum from a breakeven exit in June 22, and a positive quarter. Group as a whole emulates margin growth historically seen in the regions, with additi
Slide 19: Pathway to Free Cashflow
FINANCIAL PERFORMANCE PATHWAY TO FREE CASHFLOW Operating leverage delivering EBITDA profit and cash from operations. Cost out program identified potential A$8M to A$10M annualised savings. Port to Cloud VXC price rebalancing to yield up to A$7M to A$10M additional revenue Cash used in investing redu
Slide 20: Financial Position (AUD)
FINANCIAL PERFORMANCE FINANCIAL POSITION (AUD) FINANCIAL RESULTS FOR HALF YEAR ENDED 31 DECEMBER 2022 31 December 2022 30 June 2022 $’M $’M Trade debtors up 26% at $4.0m and Cash 57.5 82.5 DSO at 26 days (FY22: 25 days), largely timing issue on receipts. Other current assets 25.0 20.4 Non-current as
Slide 21: Business Update
COMPANY FINANCIAL BUSINESS CHANNEL SECOND HALF HIGHLIGHTS PERFORMANCE UPDATE UPDATE EXECUTION BUSINESS UPDATE
Slide 22: Megaport Cloud Enablement
BUSINESS UPDATE MEGAPORT CLOUD ENABLEMENT 77% of Megaport connections terminate to public cloud providers 40% of Megaport customers 282 Total Onramps connecting to cloud are multicloud 1HFY23 Increase: 4 +1% Multicloud customers grew 32% ONRAMP TOTAL 50% of Megaport multi-cloud Amazon Web Services 8
Slide 23: Leading Companies Trust Megaport
BUSINESS UPDATE LEADING COMPANIES TRUST MEGAPORT Fortune 100 23 Customers 23% Fortune 500 88 Customers 18% Fortune 1000 157 Customers 16% ASX 100 36 Customers 36% ASX 200 50 Customers 25% PAGE 23
Slide 24: Live Single Customer Revenue Profile
BUSINESS UPDATE LIVE SINGLE CUSTOMER REVENUE PROFILE GLOBAL PLATFORM UTILISATION Increased uptake of services across the production portfolio of a single customer upon deploying Megaport Virtual Edge (MVE) MVE sales cycles are typically longer compared to a Port-only customer Larger, global customer
Slide 25: Revenue Growth Reflective of Total Services (AUD)
BUSINESS UPDATE REVENUE GROWTH REFLECTIVE OF TOTAL SERVICES (AUD) 1. Total Services comprises of Ports, Virtual Cross Connects (VXCs), Megaport Cloud Router (MCR), Megaport Virtual Edge (MVE), and Internet Exchange (IX) at period end. PAGE 25 2. Monthly Recurring Revenue (MRR) is revenue (excluding
Slide 26: Megaport Cloud Router (AUD)
BUSINESS UPDATE MEGAPORT CLOUD ROUTER (AUD) MCR Growth Average Monthly Revenue per Customer1 $3.9K $7.3K 2HFY22: $3.6K 2HFY22: $6.4K Port only Customer MCR Customer Avg Services per Customer2 9.7 15.2 2HFY22: 9.5 2HFY22: 14.9 Port only Customer MCR Customer Total MCRs 731 768 At 30 June 2022 At 31 D
Slide 27: Megaport Virtual Edge (AUD)
BUSINESS UPDATE MEGAPORT VIRTUAL EDGE (AUD) MVE Growth Average Monthly Revenue per Customer1 $3.9K $14.4K 2HFY22: $3.6K 2HFY22: $12.0K Port only Customer MVE Customer Avg Services per Customer2 9.7 21.5 2HFY22: 9.5 2HFY22: 17.9 Port only Customer MVE Customer Total MVEs 94 At 31 December 2022 1. Rep
Slide 28: Channel Update
COMPANY FINANCIAL BUSINESS CHANNEL SECOND HALF HIGHLIGHTS PERFORMANCE UPDATE UPDATE EXECUTION CHANNEL UPDATE
Slide 29: PartnerVantage Continues to Grow (AUD)
CHANNEL UPDATE PARTNERVANTAGE CONTINUES TO GROW (AUD) +87% +95% v June ’22 v June ‘22 +131% -15% v June ‘22 v June ‘22 PAGE 29
Slide 30: Second Half Execution
COMPANY FINANCIAL BUSINESS CHANNEL SECOND HALF HIGHLIGHTS PERFORMANCE UPDATE UPDATE EXECUTION SECOND HALF EXECUTION
Slide 31: Operating Efficiency
SECOND HALF EXECUTION OPERATING EFFICIENCY Cost Out Program ● Major Cost Out program initiated in FYQ2 ● $8M-$10M annual cost / cash savings identified across 7 workstreams ● Majority of savings related to consolidation of cloud on-ramps and network operations, in part enabled by 100/400 Gbps upgrad
Slide 32: Thank You
THANK YOU ASX: MP1 ON THE WEB: megaport.com/investor megaport.com/media-centre SOCIAL: /megaportnetworks @megaport @megaportnetwork MEGAPORT LIMITED | ACN 607 301 959 | ASX: MP1
Slide 33: Important Information
IMPORTANT INFORMATION This presentation has been authorised by the Board of Megaport. Megaport Limited ACN 607 301 959 Nothing in this presentation should be construed as either an offer to sell or a All references to “$” are to Australian currency (AUD) unless otherwise noted. solicitation of an of