Readytech Holdings Ltd. · ASX:RDY
Readytech — H1 FY2024 Earnings Presentation
25 slides from Readytech's earnings presentation, Feb 27, 2024
Slide 1: 1H FY24 Investor Presentation
ASX:RDY For personal use only 1H FY24 INVESTOR PRESENTATION 27 February 2024 Marc Washbourne – Co-Founder & CEO Nimesh Shah – Chief Financial Officer
Slide 2: ReadyTech is a vertical SaaS growth company
ReadyTech is a vertical SaaS For personal use only growth company Next generation, mission-critical software Education & Workforce Government & crafted to closely meet Work Pathways Solutions Justice customer needs across human-led sectors 1H FY24 Results 2
Slide 3: Solid revenue growth and strong margins
ReadyTech continues to deliver a combination of solid revenue growth and strong margins Revenue Recurring revenue Underlying EBITDA* Major enterprise contracts $54.7m $47.2m $17.4m $7.0m contracts signed For personal use only Increase of 14.2% Increase of 17.1% Underlying EBITDA margin* of Across 16
Slide 4: 1H enterprise contract wins
Major wins include: 1H enterprise contract wins Win momentum exhibits ability to: Pilot 16 enterprise contracts of $7.0 million combined deal value^ Displace prominent and incumbent For personal use only enterprise software players with our next-gen cloud technology High conviction pipeline of new c
Slide 5: Enterprise strategy delivering strong subscription revenue growth
50.0 CAGR of 35% 47.2 subscription revenue 45.0 44.0 40.3 Enterprise 40.0 strategy 35.0 34.0 For personal use only 30.3 delivering strong 30.0 23.9 and sustainable 25.0 $m 19.4 subscription 20.0 15.0 revenue growth 10.0 5.0 0.0 1H FY21 2H FY21 1H FY22 2H FY22 1H FY23 2H FY23 1H FY24 Subscription Rev
Slide 6: 1H FY24 financial performance
For personal use only 1H FY24 financial performance 1H FY24 Results 6
Slide 7: ReadyTech continues to deliver profitable growth
ReadyTech continues to Highlights deliver profitable growth Underlying cash EBITDA** margin of 14.3% compared to 1H FY23 12.6%, reflecting an improvement of 1.7% $ MILLIONS YoY % Total revenue up 14.2% to $54.7m: 1H FY24 1H FY23 change • Subscription revenue up 17.1% to $47.2m with recurring revenue
Slide 8: Strong cash flow and balance sheet support growth initiatives
Strong cash flow and balance sheet support growth initiatives Highlights NET DEBT AS AT 31 DECEMBER 2023 Available cash-for-use of $21.9m consisting of: $ MILLIONS 31 DEC 23 30 JUN 23 For personal use only • $14.9m cash and equivalents. Bank debt 50.0 50.0 • $7m headroom in the $50.0m debt facility.
Slide 9: Continued growth and strong margins across segments
Continued growth and strong Highlights margins across segments 1H FY24 results demonstrated strong growth driven by new customer wins in Education & Work Pathways as well as Local Government products. EDUCATION & WORKFORCE GOVERNMENT & TOTAL WORK PATHWAYS SOLUTIONS JUSTICE Total revenue growth of 14
Slide 10: Growth strategy and strategic pillars
Growth For personal use only strategy and strategic pillars 1H FY24 Results 10
Slide 11: Multiple vertical SaaS markets with long-term growth opportunities
Transition to cloud ReadyTech services multiple vertical Major digital transformation tailwinds for existing and A shared and efficient SaaS markets with prospective customers, including sunset of legacy competitor approach to growth long-term growth systems across all sectors. driven by core value
Slide 12: Strategy to pursue large serviceable markets of $970m
ReadyTech's strategy to pursue large serviceable markets of $970m* underpins long-term growth Growth across multiple verticals, augmented by enterprise strategy and customer upgrades For personal use only $335m+ $150m+ $485m+ Education & Work Pathways Workforce Solutions Government & Justice • TAFE
Slide 13: Clear and disciplined growth strategy
Acquire large, Power of the install enterprise customers base as a growth lever ReadyTech is Across all segments, the journey to Capture value across the tech executing a enterprise is opening large new ecosystem of 4,000+ customers For personal use only markets and major contracts. including accele
Slide 14: Acquire high value contracts with sizeable tech budgets
Acquire high value contracts with sizeable tech budgets, starting with break-through customers Targeting large, high value Large addressable market and movement to enterprise For personal use only cloud creates huge disruption opportunity customers across all segments Builds strong moats with advanc
Slide 15: Momentum in enterprise contract wins
Momentum Upgrade (TAFE) in enterprise contract wins over For personal use only Ready Skills the last 18 months Upgrade (TAFE) 1H FY24 Results 15
Slide 16: Why we win in enterprise markets
Why we win in enterprise Open ecosystem offers customers Elevating the user experience in the For personal use only markets choice & flexibility age of the customer Our key differentiators are compelling and delivering new customers Customer Innovation & AI – culture and our being first as the reput
Slide 17: Open ecosystem a major point of competitive difference
ReadyTech’s open ecosystem is a major point of competitive difference versus platform monoliths Customer choice, Horizontal systems best-of-breed and flexibility For personal use only Easier to move from Core of legacy by phasing roll-out ecosystem ‘Land and expand’ Integration Mission critical Cust
Slide 18: Power of the install base
Power of the install base Uphold long-term customer Compelling Drive ecosystem value via upsell & as a growth transition to cloud retention cross-sell For personal use only lever Maintain high gross Remaining customer sets Ecosystem supports our revenue retention (GRR) to be migrated to cloud module
Slide 19: R&D and culture of innovation
Meet evolving vertical R&D and culture of customer needs innovation delivers sustains high retention compelling differentiators ReadyTech is a product-based Prioritise customer compliance and meet adapting verticals Focus core enterprise differentiators: • People-centric user experience growth compa
Slide 20: AI is a major medium to long-term opportunity
AI is a major medium to long-term opportunity Our AI vision for our products is to augment humans. Anticipated first co-pilot general availability in H2 FY24, initial customer sentiment has been very positive. We have a clear competitive For personal use only and natural Access to unique and deep da
Slide 21: The power of ReadyTech's M&A playbook
The power of ReadyTech's M&A playbook The 3 categories where our vertical SaaS M&A playbook is highly additive Acquire for Acquire for Enter adjacent or For personal use only customers capability new vertical • Access sticky customers that • Accelerate roadmap where it’s • Access attractive new vert
Slide 22: Well-positioned for continued growth: FY24 outlook
Well-positioned for continued growth FY24 outlook Revenue growth in the low double digits, reflecting a shift in timing of a number of high conviction enterprise deals into FY25. Underlying EBITDA margin to be in the range of 34%-35% excluding the For personal use only impact of LTIP. Labour capital
Slide 23: Continued traction in key enterprise take-outs
Continued traction in Profitable growth Robust pipeline across Key enterprise Combining growth and profitability with margin profile large enterprise markets take-outs A number of enterprise contract Sizeable and high conviction wins across all segments improving through operating new business pipel
Slide 24: Disclaimer
Disclaimer This presentation has been prepared by ReadyTech Holdings Limited for professional investors. The information contained in this presentation is for information purposes only and does not constitute an offer to issue, or arrange to issue, securities or other financial products. The informa
Slide 25: For more information
For more information: Heidi Lord Automic Group t. +61 404 216 403 e. heidi.lord@automicgroup.com.au About ReadyTech For personal use only ReadyTech is a leading provider of mission-critical SaaS for the education, employment services, workforce management, government and justice sectors. Bringing to