Slide 1: Investor Briefing
Investor Briefing1 7th October 2015 For personal use only Energy One Limited (ASX:EOL) is a market-leading supplier of trading and risk management technologies for wholesale energy markets
Slide 2: Disclaimer
2 Disclaimer For personal use only This document has been prepared by Energy One Limited (EOL) and accuracy or completeness of the forward looking statements and comprises written materials and slides for a presentation concerning exclude all liability whatsoever (including negligence) for any direc
Slide 3: Contents
3 Contents For personal use only Company Overview 4 FY 15 Highlights 5 Energy One Products & Market 6 Sophisticated software product range 7 Sales Pipeline & Recurring revenue 8 Sales pipeline 9 Recurring revenue 10-11 New products and growth opportunities 12 EnergyCloud 13 EnergyFlow 14-18 Corporat
Slide 4: Energy One – a software developer supporting blue chip energy companies
4 Energy One – a software developer supporting blue chip energy companies For personal use only EOL software is responsible for dispatching a third of all electricity generated in the National Electricity Market Strategic Positioning: Lead Product: Market leader of high value Wholesale Energy Tradin
Slide 5: Energy One Limited - FY15 was a good year
5 Energy One Limited - FY15 was a good year For personal use only Financial Highlights FY15 vs FY14 Board & Management Revenue $5.5m 61% Ottmar Weiss Chairman EBITDA $1.3m 65% Shaun Ankers CEO / Director Net Profit Before Tax $0.8m 148% Andrew Bonwick Director Cash on hand $2.1m 39% Vaughan Busby Di
Slide 6: Energy One Products & Market
6 For personal use only Energy One Products & Market
Slide 7: Sophisticated software for blue-chip energy companies
Sophisticated software for blue-chip 7 energy companies For personal use only EnergyOffer EnergyOne EnergyFlow Spot market Trading Energy trading trading Contracts operations trading Fragmented market. Mix of vendors and The term for this family of systems is Fragmented market. Little informat
Slide 8: Sales Pipeline & Recurring Revenue
8 For personal use only Sales Pipeline & Recurring Revenue
Slide 9: Sales pipeline
9 Sales pipeline For personal use only Projects are a big change for customers. Require significant planning, development and resourcing. (Has the benefit of making the customers “sticky” and churn is minimal). As such pipeline is “lumpy”. Sales cycle can be 1-5 years (esp. for large projects).
Slide 10: Recurring revenue is growing, building underlying strength
Recurring revenue is growing, building underlying 10 strength For personal use only In order to overcome the project-cycle dynamic, seek to build underlying, recurring revenue via: Winning new projects – brings an annuity stream from ongoing licence and support). Migrating from perpetual licence
Slide 11: Recurring revenue has increased
Recurring revenue has increased 11 Total recurring revenues up 11% on FY14. (Ave 21% p.a growth since FY2012). Annual recurring 30% growth due to licence & support arising from new projects coming on line For personal use only Periodic (long-term) recurring(3) tends to fluctuate due to timing
Slide 12: New products provide growth opportunities
12 For personal use only New products provide growth opportunities 1. EnergyCloud 2. EnergyFlow (overseas & other sectors)
Slide 13: EnergyCloud - a new product
EnergyCloud - a new product 13 Simplified energy trading delivered through the cloud For personal use only Software-as-a-Service trading platform functionality packaged as a product (i.e. no IT required) Leverages existing, proven technology Licensing model is flexible and aimed at smaller or
Slide 14: EnergyFlow – a product with overseas potential
14 EnergyFlow – a product with overseas potential Energy operations software For personal use only The Challenge: To manage the wide variety of individual transactions and tasks associated with energy trading operations, logistics and compliance EnergyFlow – Developed over the past 2 years with impl
Slide 15: Business Process Management elements
Business Process Management elements 15 A family of activities For personal use only Business Process Mgt Systems(5) Typical uses: Steps involve: • Customer engagement • Business process modelling • Admin processes • Rules engine • Compliance • Process execution • Health & Safety etc • Record-keepin
Slide 16: EnergyFlow improves productivity
EnergyFlow improves productivity 16 Aimed at data-intensive business processes For personal use only Data import tools IN Interfaces to market Triggered events IN Time series data Algorithmic rules engine DO DO Data transformation Automated workflows OUT B2B/B2M interfaces to interact with external
Slide 17: EnergyFlow offers potential benefits
17 EnergyFlow offers potential benefits Prospective, but yet to be established For personal use only Major or Bespoke BPM Type* EnergyFlow Packaged BPM systems Spreadsheets systems Easy-to-use Process Designer Yes Yes Yes No Automated business rules engine Yes Yes Yes Macros/scripts only Document at
Slide 18: Marketing approach that leverages existing knowledge base
Marketing approach that leverages existing 18 knowledge base Target business users who need to: For personal use only Automate business processes with multiple steps Import, transform or manipulate data as part of a business process Interact with other parties (transactions) that requires an e
Slide 19: Corporate Strategy
For personal use only Corporate Strategy 19
Slide 20: Energy One will continue growing
20 Energy One will continue growing Near term growth strategy For personal use only Diversification Product range. Considerable investment Grow customer base made to produce innovative new products to address market needs Opportunity exists to add/enhance tools Offer suite of products/services as si
Slide 21: Offices & branding change
21 Offices & branding change Setting up for a fresh new phase For personal use only On the back of prior investment, the Company is preparing for a new phase of its development. As such: New office North Sydney(7)– larger space to accommodate growth. Melbourne office – Many customer HQs are in M
Slide 22: Financials
For personal use only Financials 22
Slide 23: Income Statement
23 Income Statement For personal use only Income Statement Comments $’000 2012 2013 2014 2015 Increase due to project work (and recurring) arising from 2 major energy utilities projects during Revenue 2,262 1,844 2,848 4,768 the year. Other revenue 674 601 606 782 R&D Grant and interest. Consistent
Slide 24: Investment in product development has improved profitability
Investment in product development has 24 improved profitability For personal use only Profit Before Income Tax 1,000,000 800,000 600,000 400,000 200,000 0 2012 2013 2014 2015 (200,000) (400,000) (600,000) (800,000) Investment in R&D has resulted in product diversification. With more products to sell
Slide 25: Balance Sheet
25 Balance Sheet For personal use only Balance Sheet Comments $’000 2013 2014 2015 Cash and cash equivalents 1,721 1,398 1,983 Increase due to project completions, milestones being met. Receivables include trade receivables of $640k and R&D tax incentives $836k, plus Accrued Trade and other receivab
Slide 26: EOL margins compared to other technology stocks
EOL margins compared to other technology stocks 26 For personal use only EBITDA Margins NPAT Margins 40% 25% 35% 20% 30% 25% 15% 20% 10% 15% 10% 5% 5% 0% 0% *See Note 8 for further information
Slide 27: EOL valuation compared to other technology stocks
EOL valuation compared to other technology stocks 27 P/E multiple For personal use only 40 30 20 10 0 EOL SCD BPF RKN MSP SMP Average HSN GTK PRO EV to EBITDA Multiples 30 25 20 15 10 5 0 EOL SMP SCD RKN MSP Average GTK HSN BPF PRO *See Note 8 for further information
Slide 28: An exciting market, good products & services and sound management track record
28 An exciting market, good products & services and sound management track record, with opportunities for growth For personal use only Compelling value proposition – EOL offers Market potential – energy mission-critical, enterprise Market leadership - leading trading software is exciting grade softw
Slide 29: Contact Us
29 Contact Us To participate in the future of Energy One For personal use only Energy One is a leader in the market, with scope to capitalise on its investments, capabilities and asset base to deliver sustained, long term growth Mr Shaun Ankers CEO / Director Head Office: Level 14, 71 Macquarie St,
Slide 30: Appendix
For personal use only Appendix 30
Slide 31: Typical Energy Market Structure
31 Typical Energy Market Structure The trading market in which our clients operate For personal use only Exchange Traded Energy TRADED ENERGY Derivatives Financial Traders Consumers (Industrial) Energy Pool Market Producers Energy for Energy (Generators) Retailers Energy B2B OTC Consumers Contracts
Slide 32: Energy Market features
32 Energy Market features For personal use only Sophisticated systems are required by Participants to manage the complex and inter-dependent trading arrangements Wholesale energy trading markets typically comprise both formal (B2M) and informal (B2B) markets The wholesale market is typically d
Slide 33: Australian Energy Market
33 Australian Energy Market For personal use only Formal markets for electricity and gas: National Electricity Market (NEM) – energy based market STTM and DWGM gas markets (eastern seaboard) Wholesale Electricity Market (WA) – capacity and energy market WA Gas market In the NEM, STTM & D
Slide 34: Wholesale Energy Trading Suite of Software Products
34 Wholesale Energy Trading Suite of Software Products Energy trading management operations system For personal use only EnergyOffer EnergyOne EnergyFlow Trading Physical energy Energy trading Energy business bidding & risk workflow platform management automation platform A high performance market P
Slide 35: Services
Services 35 As well as provision of software and implementation and support, Energy One offers a complete services for wholesale energy trading clients. For personal use only Consulting Managed Technology Service Software Energy market and energy information Market data store hosting & maintenance D
Slide 36: Notes & References
36 Notes & References For personal use only 1. Page 7 - Sophisticated software range i. Estimates only (for indicative purposes). Annualised estimates used to represent a view of market and take account of variable and non-predictable customer procurement patterns due to capex/renewal cycles, market
Slide 37: Notes (cont.)
37 Notes (cont.) For personal use only 5. Page 16 – EnergyFlow novel features i. This combination of elements makes EnergyFlow novel. The Company, through its research, believes that they are patentable and has applied for an international Patent to protect and help commercialise these novel feature
Slide 38: Notes (cont. 2)
38 Notes (cont. 2) For personal use only 8. Pages 26 & 27 – EOL compared to other technology stocks i. Internal analysis comparing EOL to a basket of Technology stocks comprising (a) a range of small/medium market cap (i.e. SCD, BPF, MSP, SMP, PRO), plus (b) larger suppliers of software to energy cl