FirstWave Cloud Technology Ltd. · ASX:FCT
FirstWave Cloud Technology — Q2 FY2021 Earnings Presentation
40 slides from FirstWave Cloud Technology's earnings presentation, Feb 4, 2021
Slide 1: FirstWave Cloud Technology Q2 Investor Update (unaudited)
Democratising enterprise grade cybersecurity-as-a-service FirstWave Cloud Technology Q2 Investor Update (unaudited) 04 February 2021 1
Slide 2: Disclaimer
Disclaimer Not an offer The material contained in this presentation is for information purposes only and is intended to be general background information on FirstWave Cloud Technology Limited (FCT) and its activities and is dated 04 February 2020. It is for information purposes only and is not, and
Slide 3: Agenda
Agenda Chairman’s Update Q2 Results H1 Results Q3 Update Summary Appendix 3
Slide 4: Chairman's Update
Focus and Action - Growth Chairman’s Update John Grant – Executive Chairman 4
Slide 5: On balance – a solid H1 performance in a challenging environment
On balance – a solid H1 performance in a challenging environment REVENUE CONTINUED TO GROW H1 Total Revenue up on plan; Recurring Revenue grew albeit below plan COVID-19 continued into Q2 impacting RATE OF GROWTH of international revenue EXPENSES WERE IN LINE WITH PLAN On plan to keep costs within 2
Slide 6: Q2 Results
Focus and Action - Growth Q2 Results 6
Slide 7: Revenue explained
Revenue explained…… FCT HAS MULTIPLE REVENUE MEASURES • MRR = Monthly Recurring Revenue – revenue flowing from monthly subscriptions, normally ranging between 3 and 36 months, with end users • NRR = Non-Recurring Revenue – revenue flowing from one-off professional services engagements with our partn
Slide 8: Q2 key metrics were a bit mixed but total revenue was on plan
Q2 key metrics were a bit mixed but total revenue was on plan INTERNATIONAL RATE OF REVENUE GROWTH IMPACTED BY COVID-19 Rolling lockdowns continued to impact our partners’ sales activities in Q2 which lowered the rate of growth of international revenue IMPACT LARGELY OFFSET BY DOMESTIC GROWTH Q2* Qo
Slide 9: Q2 Annualised Recurring Revenue grew, albeit below plan
Q2 Annualised Recurring Revenue grew, albeit below plan Total Annualised Recurring Revenue (million) $7.88 $7.64 $7.95 $7.43 $7.32 $7.52 $7.14 $7.12 TARR up 5% QoQ to $7.52m $1.61 $1.01 $0.87 IARR up 16% QoQ to $1.01m $0.22 $0.26 $0.45 $0.02 $0.06 passing the $1m milestone DARR returns to growth aft
Slide 10: Q2 cash ahead of plan
Q2 cash ahead of plan FY21 Closing Cash Balance $16.00m $13.91m • R&D refund of $2.06m $12.27m received in Jan lifting cash $12.00m $13.75m balance to $10.14m $8.08m $11.12m • Q2 cash used of $4.19m cf $8.00m $3.15m in Q1 due to delayed customer receipts $6.69m $4.00m • Financing activities of $0.31
Slide 11: H1 Results
Focus and Action - Growth H1 Results 11
Slide 12: On balance – a solid H1 performance in a challenging environment
On balance – a solid H1 performance in a challenging environment COVID-19 REVENUE • Impact continued beyond Q1 • H1 total revenue closed 5% ahead of plan at $4.07m • Est. $248k ARR impact at December • H1 TARR closed 6% below plan at $7.51m • Still many ‘irons in the fire’ • DARR at $6.51m up 2% • R
Slide 13: EMEA – most impacted by COVID-19
EMEA – most impacted by COVID-19 EMEA: UK, Europe, Middle East and Africa Level 1: DWS, NTT (Data), SHELT Total partners: 17 H1 ARR: $0.50m (up 71% from June 2020) ON TRACK: NEW DEVELOPMENTS: • On premise deployment in ME • New Web Protect DNS product launched and generating revenue • Africa revenue
Slide 14: APAC – cautious but looks to be emerging
APAC – cautious but looks to be emerging APAC: India and Asia Level 1: Vi, TTL Total partners: 14 H1 ARR: $0.24m (up 73% from June 2020) ON TRACK: NEW DEVELOPMENTS: • New Malaysia Level 2 partner • Additional BD and Sales signed - AlTel resource being recruited to take advantage of Malaysian Govt cy
Slide 15: Cisco – engagement in major accounts now deeper
Cisco – engagement in major accounts now deeper Region: Global Level 1: Cisco Total partners: 13 H1 ARR: $0.27m (up 1269% from June 2020) ON TRACK: NEW DEVELOPMENTS: • Opportunity development continues Preferred supplier to global Tier 1 telco • ME opportunity delivered in North America: • Contract
Slide 16: ANZ – has turned
ANZ – has turned ANZ: Australia, New Zealand Level 1: Telstra Total partners: 2 H1 ARR: $6.51m (down 3% from June 2020) NEW DEVELOPMENTS: TELSTRA RETURNS TO GROWTH: • New BD and Sales resource has • Churn appears to have increased activity with potential stabilised new partners in region • PSA renew
Slide 17: Q3 Update
Focus and Action - Growth Q3 Update 17
Slide 18: Q3 operating environment – a few 'balls in the air'
Q3 operating environment – a few ‘balls in the air’ WHAT WE ASSUMED JUNE 2020 THE REALITY REVENUE • Business activity returns to pre-COVID-19 levels • COVID-19 still impacting international partners from 1 Oct 2020 particularly and is expected to continue through H2 MARGIN • Product and Revenue mix
Slide 19: Q3 – adapting to the reality
Q3 – adapting to the reality EXPANDED PRODUCT PORTFOLIO MEANS • New Technology Partner Simplifyd Systems UK • New Web Protect DNS offer launched - first revenues from Africa in December • Redirected development effort to meet new • Key to success with a major US-based Tier 1 Telco opportunity under
Slide 20: Q3 has started well
Q3 has started well FY21 Total Annualised Recurring Revenue (million) $7.90 $7.52 TARR up 5% from Dec to Jan $7.14 $7.12 $1.39 $1.01 $0.87 IARR up 38% from Dec to Jan $0.45 $6.69 $6.51 $6.51 $6.51 $6.51 DARR flat as domestic partners $6.25 mostly closed for holidays Jun Sep Dec Jan FY20 Domestic ARR
Slide 21: Summary
Focus and Action - Growth Summary 21
Slide 22: To close…
To close… REVENUE WILL CONTINUE TO GROW COVID-19 has impacted the RATE OF GROWTH, but the outlook for Q3 is for this to improve. COSTS ARE IN LINE WITH PLAN Costs are in line with plan and are expected to remain so for Q3. CASH IS AHEAD OF PLAN The outlook has a number of inputs that need to firm up
Slide 23: Q&A
Focus and Action - Growth Q&A 23
Slide 24: Non-Executive Director Scott Lidgett steps down
Non-Executive Director Scott Lidgett steps down…. • A co-founder of FirstWave Cloud Technology Limited • A continuous board member for over fifteen years, chairing the business on three separate occasions, including the period prior to our listing on the ASX • Scott’s full-time energies are now requ
Slide 25: Thank you
Focus and Action - Growth Thank you 25
Slide 26: Appendix
Focus and Action - Growth Appendix 26
Slide 27: Experienced Management Team
Experienced Management Team John Grant Neil Pollock Iain Bartram Simon Ryan Roger Carvosso Chairman CEO CFO CTO Strategy Director A strategic CFO with Australian industry leader Global Business Leader multi-site and Globally recognised Product professional with with 27 years of ICT, international ex
Slide 28: H1 cash balance was $1.39m ahead of plan at $8.08m
H1 cash balance was $1.39m ahead of plan at $8.08m Net increase / (decrease) in cash held (million) Q1 FY21 Q2 FY21 H1 Cash and cash equivalent at beginning of period $15.42 $12.27 $15.42 Net cash from / (used in) operating activities ($2.73) ($3.72) ($6.45) Net cash from / (used in) investing activ
Slide 29: In FY21 our target market is projected to grow to $2.03b
In FY21 our target market is projected to grow to $2.03b ‘EWF’ ‘E’ ‘EWF’ + ‘E’ TAM: $15.53b TAM: $13.89b TAM: TOTAL ADDRESSABLE MARKET - TAM - Worldwide Worldwide MSS/Cloud-Based Firewall & Content Enterprise Endpoint Security (Telco/SP-served) Security Market SMB + % Medium SMB + % Medium Businesse
Slide 30: Projected Line of Sight $60m
Projected Line of Sight $60m Billing Partners FY21 10,000s of Level 2 Partner Accessibility Enterprise/SMB $2.03b global market FY21 customers opportunity 8 Level 1 Partner FY21 35 FCT 10,000s of Enterprise/SMB 11 customers GSV 20 Telco/SP GSI/DIST MSSP 61 10 10,000s of Enterprise/SMB customers 14 7
Slide 31: FirstWave Technology
Focus and Action - Growth FirstWave Technology 31
Slide 32: FCT's Technology – CCSP (Cloud Content Security Platform)
FCT’s Technology – CCSP (Cloud Content Security Platform) FCT’s Technology appeals to end users who do not want to own and operate their own perimeter security infrastructure. This opens multiple markets given….. • Enterprise grade core solutions – email/web/firewall/end point/multi-factor authentic
Slide 33: What problem does FirstWave solve
What problem does FirstWave solve Advanced Detect Email Web Firewall Endpoint & Response New innovation Increasing security complexity and demand For Service Providers: coincidental with declining GSV Telco/SP GSI/DIST MSSP profitability Reducing the risk of cyber crime For End-Users: Small Business
Slide 34: Democratising enterprise grade cybersecurity-as-a-service
Democratising enterprise grade cybersecurity-as-a-service The Solution • integrates and multi-tenants enterprise Advanced Detect Email Web Firewall Endpoint & Response New innovation grade appliances from global security leaders, The only automated Cloud Content Security Platform • can readily on-bo
Slide 35: The Partner Ecosystem
Focus and Action - Growth The Partner Ecosystem 35
Slide 36: 5 key elements to the FCT partner ecosystem
5 key elements to the FCT partner ecosystem • Cisco, Palo Alto Networks, Fortinet, Trend Micro • Supply enterprise-grade cyber-security threat vector technology for multi-tenanting and integration into the FCT cloud content 1 Technology partners security platform • Projected to expand as new offerin
Slide 37: Partner ecosystem
5 Partner ecosystem 4 3 End user customers Billing Partners Level 2 Partner FY21 1 2 Accessibility 10,000s of Enterprise/SMB FY21 customers Technology 8 Level 1 Partners Partner FY21 35 FCT 10,000s of Enterprise/SMB 11 customers GSV 20 Telco/SP GSI/DIST MSSP 61 10 10,000s of Enterprise/SMB customers
Slide 38: The Investors' Guide to Acronyms
Focus and Action - Growth The Investors’ Guide to Acronyms 38
Slide 39: Investors' Guide to Acronyms
Investors’ Guide to Acronyms • BDM – Business Development Manager – sales executive • CCSP – Cloud Content Security Platform Content Security – a product market category that comprises email security and web security • CWS – Cloud Web Security - a cloud-based Secure Web Gateway service offering from
Slide 40: Investors' Guide to Acronyms
Investors’ Guide to Acronyms • MRR – Monthly Recurring Revenue • MSS – Managed Security Services • MSSP – Managed Security Service Provider – e.g. a Telco/SP that offers MSS to its enterprise/SMB • OEM – Original Equipment Manufacturer - a company that produces equipment , marketed and sold by anoth
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