Sinch Ab · OMXSTO:SINCH
Sinch Ab — Avanza Börsdag 2019
17 slides from Sinch Ab's conference presentation, Nov 19, 2019
Slide 1: Avanza Börsdag
Avanza Börsdag 19 November 2019 Roshan Saldanha CFO
Slide 2: Sinch at a glance
SEK 4.6bn SEK 483m SEK 11.5bn 570+ 30+ revenue in the Adj. EBITDA in the Market Cap employees offices in 30+ countries past 12 months past 12 months 30 billion Publicly listed on Customer engagement through mobile technology engagements per year NASDAQ in Stockholm Scalable cloud communications Serv
Slide 3: Growth markets
Growth markets Messaging CPaaS Application-to-Person (A2P) messaging is used Communications Platform as a Service (CPaaS) across the world for ever-more use cases allows businesses to easily integrate messaging, voice and video services into their own applications • USD 17 bn market size (MobileSqua
Slide 4: Profitable growth
Profitable growth Financial development since IPO in 2015 1,400 400 1,200 350 300 • Focus on gross profit and EBITDA 1,000 since pass-through revenues vary 800 250 between geographies 200 600 • Track record of profitable growth 150 400 100 • 37% growth in gross profit and 55% growth in EBITDA in Q3
Slide 5: Business areas
Business areas Operators 11% 173% Voice and Video 9% 34% 12% Messaging 79% Messaging Voice and Video Operators Gross Profit, Q3 19 Gross profit growth, Q3 19 y/y
Slide 6: Empowering superior customer engagement
Empowering superior customer engagement • People across the world have embraced mobile messaging to keep in touch with friends and family • Businesses have yet to fully capitalize on this opportunity • SMS has unique characteristics: • 100% reach • Everybody is a trained user • 98% open rate, 90% re
Slide 7: Technology evolution in messaging
Technology evolution in messaging Text Rich media Conversational notifications messaging messaging New messaging channels expand our addressable market 7
Slide 8: Playbook for profitable growth
Playbook for profitable growth • Empower businesses to leverage rich and conversational messaging Value-add through • Increase our software value-add (CPaaS) in addition to our connectivity offering Software-as-a-Service • APIs and ‘low-code’ tools • Increase stickiness with maintained scalability •
Slide 9: Sinch Tier 1 Global Connectivity Network
Sinch Tier 1 Global Connectivity Network 300+ direct operator connections Direct connectivity ensures Competitive advantages Significant barriers to entry • End-to-end control • Leading direct connectivity enables • One carrier deal can take • Enhanced security higher quality and competitive costs m
Slide 10: Value-add through Software-as-a-Service
Value-add through Software-as-a-Service Conversational Messaging Rich Messages Secured account Logo / Verified Details & contacts Simple Messages Media Call to Action Image Calls Video Calendar Maps Customization Interaction Name Real-time data Tailored content Conversation Call to Action Free-form
Slide 11: Adding resources to capture new market opportunities
Adding resources to capture new market opportunities 600 +24% 573 • Headcount increasing by around 542 496 30 employees per quarter 500 441 462 469 110 119 excluding M&A 412 412 420 91 392 69 77 400 366 53 61 62 61 • Near-term negative effect on 47 49 EBITDA before new initiatives 300 translate into
Slide 12: Investments paying off
Investments paying off Voice and Video (SEKm) 80 70 • Growth fuelled by Number Masking and Verification 60 50 • Growth with existing customers and new customers causing step 40 change in gross profit and EBITDA 30 20 • Increasing OPEX to ensure quality as volumes ramp quickly 10 0 -10 Q1 Q2 Q3 Q4 Q1
Slide 13: Stable margin development
Stable margin development Sinch Adj EBITDA/gross profit 50% • Revenue and gross margin depend 40% on mix of terminating markets • EBITDA/gross profit shows margin 30% excluding mobile operator charges 20% • Increased opex investments to capture growth are more than offset by rising gross profit 10%
Slide 14: Strategic acquisitions
Strategic acquisitions Founded IPO One brand in Stockholm 2009 2014 2015 2016 2017 2018 2019 2008 Technology & Industry-leading Voice, video, Personalized video and Rich messaging Go To Market Billing rich media messaging tech platform technology verification Low code tools Scale and Germany, profit
Slide 15: Financial targets
Financial targets Targets: • Adjusted EBITDA per share to grow 20% per year Adjusted EBITDA per share, rolling 12 months • Net debt < 2.5x adjusted EBITDA over time 10,0 9,0 8,0 Performance: 7,0 6,0 • Adjusted EBITDA per share grew 5,0 46% in Q3 19, measured on a rolling 4,0 12 month basis 3,0 2,0 •
Slide 16: Key highlights
Key highlights 1. Attractive, large and growing addressable market 2. Market leading position with global scale 3. Large potential for further growth with both existing and new customers 4. Proven M&A strategy with strong acquisition track record and maintained low leverage 5. Strong financial perfo
Slide 17: Thanks!
Thanks! Copyright© 2019 CLX Communications AB (publ). All rights reserved. NDA Confidential. 17