Bravura Solutions Limited · ASX:BVS
Bravura Solutions — FY2021 Earnings Presentation
35 slides from Bravura Solutions's earnings presentation, Aug 25, 2021
Slide 1: FY21 Results Presentation
FY21 Results Presentation 25 August 2021
Slide 2: Important notice and disclaimer
Important notice and disclaimer The information contained in this document (including this notice) and discussed at this presentation (collectively, the Presentation) has been prepared by Bravura Solutions Limited (Bravura). The Presentation is subject to the conditions outlined below. Your receipt,
Slide 3: Agenda
Agenda 1 Key Highlights 2 Group Results 3 Segment Results 4 Strategy Update 5 Looking Forward 6 Appendices
Slide 4: Guidance achieved, with strong growth in contracted recurring revenue
GUIDANCE ACHIEVED, WITH STRONG GROWTH IN CONTRACTED RECURRING REVENUE ▪ 1H21 experienced lower UK project work for both implementation and post go-live as a result of the impact of COVID-19. ▪ 2H21 benefitted from an improved operating environment, client wins and targeted internal management initia
Slide 5: Group Results
gy bravura v solutions Group Results
Slide 6: FY21 results in line with guidance
FY21 RESULTS IN LINE WITH GUIDANCE 1H 2H FY ▪ Wealth Management revenue down 11% and EBITDA2 down 5%. A$m 1H20 2H20 FY20 1H21 2H21 FY21 EBITDA margin2 increased to 32% (29% in FY20). The lower result was % chg % chg % chg attributable to a COVID-related decline in UK professional services Wealth Man
Slide 7: FY21 results – impact of Delta acquisition
FY21 RESULTS – IMPACT OF DELTA ACQUISITION Excluding Including ▪ Bravura acquired Delta Financial Systems (Delta) for A$42m in October A$m, FY21 Acquisition acquisition acquisition 2020. Wealth Management 1 149.9 10.2 160.1 ▪ Delta provides SaaS technology to power complex pensions Funds Administrat
Slide 8: Revenue by geography
REVENUE BY GEOGRAPHY FY20 to FY21 revenue waterfall bridge (A$m) ▪ Bravura saw group revenue decline 11% in FY21 compared to FY20. ▪ addition . to revenue ▪ reduction . to revenue ▪ The revenue decline was primarily attributable to lower revenues in 6.2 0.5 the UK, offset by slightly higher revenue
Slide 9: Long-term revenue and EBITDA
LONG-TERM REVENUE AND EBITDA Revenue (A$m) EBITDA1 (A$m) 1H 2H 274.2 1H 2H 257.7 243.0 57.8 221.5 48.6 49.3 191.9 139.1 184.7 130.3 127.3 38.6 32.3 152.1 118.6 24.8 98.4 32.6 89.9 33.5 20.1 80.4 14.4 20.2 17.5 135.1 7.7 127.4 115.7 102.9 9.4 23.7 25.5 94.8 93.5 71.7 18.2 18.5 15.8 12.5 8.1 2 3 FY15
Slide 10: Recurring revenue
RECURRING REVENUE Licence fees (A$m) Project fees (A$m) Bravura’s commercial strategy is to grow our Recurring Revenue base Recurring Revenue, attached (A$m) Recurring Revenue, contracted (A$m) 16.8 ▪ Contracted Recurring Revenue was up 15% in FY21 compared to the pcp. 11.9 ▪ Attached Recurring Reve
Slide 11: Strong financial position
STRONG FINANCIAL POSITION ▪ Bravura is in a robust financial position, with cash of A$73.6m at balance date. A$m 30 Jun 2020 30 Jun 2021 Bravura continues to evaluate a pipeline of additional acquisitive and organic growth opportunities. Cash 99.1 73.6 ▪ Bravura acquired Delta Financial Systems (Del
Slide 12: Segment Results
gy bravura v solutions Segment Results
Slide 13: Wealth Management
WEALTH MANAGEMENT 1H 2H FY ▪ Segment revenue down 11% and EBITDA down 5%. Segment A$m 1H20 2H20 FY20 1H21 2H21 FY21 EBITDA margin1 increased to 32% (29% in FY20). % chg % chg % chg ▪ The decrease in segment revenue and earnings was attributable Segment revenue 91.0 89.4 180.4 75.2 84.9 160.1 -17% -5
Slide 14: Funds Administration
FUNDS ADMINISTRATION 1H 2H FY ▪ Segment revenue down 12% and EBITDA1 down 18%. A$m 1H20 2H20 FY20 1H21 2H21 FY21 Segment EBITDA margin1 declined to 43% (46% in FY20). % chg % chg % chg Segment revenue 44.1 49.7 93.8 40.5 42.4 82.9 -8% -15% -12% ▪ The decline in segment earnings and margin largely Se
Slide 15: Strategy Update
gy bravura v solutions Strategy Update
Slide 16: Strategic rationale
STRATEGIC RATIONALE Market developments Technology strategy Componentisation and Microservices allows clients to implement incrementally, getting the Reduced interest in big-bang implementations functionality they need while lowering operational costs Cloud deployments significantly reduce time cost
Slide 17: Strategy
STRATEGY A large installed base across the biggest financial institutions in our markets provides the platform for our strategy implementation and confidence in new client wins Vertical integration Reduced interest in Underserviced middle Need for lower Need to improve end- Market developments leadi
Slide 18: Strategy – progress update
STRATEGY – PROGRESS UPDATE Cloud ▪ Sonata is delivered as a cloud service, with a number of clients in production and other migrations to cloud underway ▪ AdviceOS and Platinum Pro are cloud delivered, multi-tenanted SaaS solutions ▪ FinoComp microservices are fully cloud deployable Componentisation
Slide 19: Strategic priorities
STRATEGIC PRIORITIES Current Transition existing clients to our cloud services Portfolio Tech Drive scale, flexibility and differentiation Platform New Expand our total addressable market Markets Customer Deliver an ecosystem of offerings across the value chain Success Sales & Communicate a clear va
Slide 20: Total addressable market
TOTAL ADDRESSABLE MARKET1 UK total addressable market Australia total addressable market UK ▪ Total addressable market (TAM) in the UK is estimated at ~GBP1.2b per annum of client IT spend. ~GBP1.2b ~A$1.0b ▪ The TAM comprises funds administration, platforms, discretionary fund managers (DFMs), corp
Slide 21: Financial considerations
FINANCIAL CONSIDERATIONS Bravura’s transition from traditional contracts to consumption-based contracts is underway, underpinned by R&D, product componentisation, Sonata Alta development, digital products and recent acquisitions. Traditional client revenue mix Consumption-based client revenue mix ▪
Slide 22: Outlook
gy bravur soluti ions
Slide 23: Looking forward
LOOKING FORWARD NEW SLIDE Outlook ✓ Industry structural demand for SaaS, microservices, cloud and subscription-based services is strengthening ✓ COVID-19 has accelerated digital transformation ✓ Bravura is starting to see increasing market confidence as a result of vaccine rollouts in the UK ✓ As va
Slide 24: Appendix A Additional Financial Disclosure
Appendix A Additional Financial Disclosure
Slide 25: Recurring revenue by half-year
RECURRING REVENUE BY HALF-YEAR Licence fees (A$m) Project fees (A$m) Bravura’s commercial strategy is to grow our Recurring Revenue base Recurring revenue, attached (A$m) Recurring revenue, contracted (A$m) ▪ Contracted Recurring Revenue was up 15% in FY21 compared to the pcp. 5.0 11.7 2.7 ▪ In 1H21
Slide 26: Statutory income statement
STATUTORY INCOME STATEMENT A$m FY20 FY21 $ chg % chg Revenue from contracts with customers 272.4 242.3 -30.1 11% Other income 2.8 0.9 -2.0 -69% Employee benefits expense -157.5 -139.7 17.9 -11% Depreciation and amortisation 1 -19.4 -21.3 -1.8 9% Foreign exchange gain/(loss) -1.4 1.2 2.6 -183% Financ
Slide 27: Statutory statement of financial position
STATUTORY STATEMENT OF FINANCIAL POSITION A$m 30 Jun 2020 30 Jun 2021 Cash 99.1 73.6 Trade receivables 43.8 40.2 Contract assets 12.7 18.0 Other current assets 9.2 13.0 Total current assets 164.8 144.7 Intangible assets 196.2 252.6 Property, plant and equipment 63.4 54.4 Contract assets 6.9 5.4 Othe
Slide 28: Statutory cash flow statement
STATUTORY CASH FLOW STATEMENT A$m FY20 FY21 A$m FY20 FY21 Receipts from customers 270.6 247.3 Profit for the year 40.1 34.6 Payments to suppliers and employees -239.4 -195.6 Interest received 1.2 0.2 Depreciation and amortisation 19.4 21.3 Income taxes paid -13.0 -4.5 Financing costs 2.8 3.4 Total o
Slide 29: Appendix B Products and Services
Appendix B Products and Services
Slide 30: Products and services
PRODUCTS AND SERVICES Bravura provides digital, microservices, SaaS and enterprise software solutions supporting sophisticated financial services products across front, middle and back office, including digital delivery across multiple devices to advisers and end consumers. Products Processes Featur
Slide 31: Bravura's products
BRAVURA’S PRODUCTS Sonata Microservices AdviceOS Financial planning software that Customer-centric solution that allows financial advisers to provide streamlines the administration of a Microservice products include comprehensive face to face financial range of financial products, unifies workflow a
Slide 32: Bravura addresses key client challenges
BRAVURA ADDRESSES KEY CLIENT CHALLENGES Challenges faced by participants… … can be solved by Bravura technology Evolving and complex 1 regulatory environment ✓ Regulatory risk management Demand for mobile and 2 “self-directed” technology Increasing ✓ Leading technology and innovation demand Bravura
Slide 33: Appendix C Delta Acquisition
Appendix C Delta Acquisition
Slide 34: Delta – complex UK pensions administration
DELTA – COMPLEX UK PENSIONS ADMINISTRATION Revenue components ▪ Bravura acquired Delta Financial Systems for A$42m in October 2020. ▪ Delta provides technology to power complex pensions administration in the UK market. Professional services ▪ Demand for complex pension administration is driven by: ▪
Slide 35: For more information
For more information, visit: www.bravurasolutions.com/investors/ investors@bravurasolutions.com