Corero Network Security Plc · LSE:CNS
Corero Network Security — H1 2022 Earnings Presentation
42 slides from Corero Network Security's earnings presentation, Sep 13, 2022
Slide 1: H1 2022 Results
H1 2022 RESULTS LIONEL CHMILEWSKY, CEO ANDREW MILLER, Interim CFO September 2022
Slide 2: Agenda
AGENDA 01 Exe c u t iv e Su m m a r y 02 Th e Co re ro Ad va n t a g e 03 Fin a n c ia ls 04 So lu t io n O v e r v ie w 05 Co m p e t it io n & D iffe re n t ia t io n 06 St r a t e g y & Gr o w t h 07 Su m m a r y & O u t lo o k
Slide 3: Executive Summary
Mm EXECUTIVE SUMMARY
Slide 4: H1 2022 Half Year Results: Executive Summary
H1 2022 HALF YEAR RESULTS EXECUTIVE SUMMARY » Continued our growth trajectory and delivered new financial records » Continued to invest in the Business and significantly reinforced its organisation, particularly in Sales & Marketing » New Sales & Marketing initiatives (ABM, Alliances, Channels) are
Slide 5: H1 2022 Half Year Results: Financial Highlights
H1 2022 HALF YEAR RESULTS (cont’d) FINANCIAL HIGHLIGHTS: » Record H1 2022 order intake, increasing by 22% to $10.9 million (H1 2021: $8.9 million) » Record H1 2022 Group revenue up 6% to $8.8 million (H1 2021: $8.3 million) » Record Annualised Recurring Revenues (“ARR”) up 21% to $13.6 million (H1 2
Slide 6: H1 2022 Half Year Results: Business Highlights
H1 2022 HALF YEAR RESULTS (cont’d) BUSINESS HIGHLIGHTS » Strong market traction and H1 focus on new business with 21 new customer wins (H1 2021: 20), eight through Juniper » Now present in 50 countries (18 new countries since 1 Jan 2020) » Planned Sales and Marketing investment to drive revenue grow
Slide 7: H1 2022 Half Year Results: Market Trends
H1 2022 HALF YEAR RESULTS (cont’d) MARKET TRENDS » Level of malicious DDoS activity worldwide continues to increase • H1 2022 post-pandemic attacks levels are reported as consistently higher than both pre-pandemic and in-pandemic statistics • In H1 2022, Corero mitigated 339,000 attacks (+18% vs. H1
Slide 8: Company Background
COMPANY BACKGROUND
Slide 9: Who is Corero Network Security
WHO IS CORERO NETWORK SECURITY ABOUT US » Corero Network Security is publicly traded on the London Stock Exchange AIM market (under CNS.L). Headquartered in London with offices near Boston and in Edinburgh. » Corero is the leader in real-time, high-performance, automatic Distributed Denial of Servic
Slide 10: Corero: A Unique Investment Opportunity
CORERO A UNIQUE INVESTMENT OPPORTUNITY • $1.5B TAM, 15% CAGR Large and High Growth 1. Market • IOT, 5G, higher capacities, meshed networks and Cloud services create a large expansion opportunity for Corero Superior Technology & • Best ratio Performance/TCO in the industry for DDoS protection solutio
Slide 11: Corero: A Unique Investment Opportunity (cont'd)
CORERO A UNIQUE INVESTMENT OPPORTUNITY (cont’d) • Worldwide, 24/7/365. Pre-sales & Post- sales. High levels of compatibility – deployable in multi-vendor Global Customer Support and environments. 500,000 DDoS attacks automatically mitigated in 2021. 339,000 attacks mitigated in Services H1 22 (18% i
Slide 12: DDoS Protection Market Dynamics & Drivers
DDoS PROTECTION MARKET DYNAMICS & DRIVERS KEY FACTS » Global DDoS Protection market: $3.4Bn in 2021 • Expected to reach $6.8B by 2026 (15.1% CAGR*) • ~$1.5B represents the TAM for Corero SmartWall • ~$715M represents the SAM for Corero SmartWall » ~30,000 daily DDoS attacks** recorded during H1 2021
Slide 13: Corero: A Customer Driven Business Model
CORERO A CUSTOMER DRIVEN BUSINESS MODEL 13
Slide 14: Who We Serve: A Sample of Our Customers
WHO WE SERVE A SAMPLE OF OUR CUSTOMERS Service Providers Hosting Providers SaaS Providers » Deployed across six continents » Protecting thousands of organisations » Global presence in 50 countries Co-Location / Data Centers Edge Providers Enterprises » 18 new countries since 2020 » Growing with our
Slide 15: Corero Financials
CORERO FINANCIALS
Slide 16: H1 2022 Financial Highlights
H1 2022 FINANCIAL HIGHLIGHTS 1 ARR is defined as the normalised annualised recurring revenue and includes recurring revenues from contract values of annual support, software subscription and from DDoS Protection-as-a-Service contracts. 2 EBITDA is defined as Earnings before Interest, Taxation, Depre
Slide 17: H1 2022 Group Income Statement
H1 2022 GROUP INCOME STATEMENT HY ended HY e n d e d Moveme Unaudited ($ ’0 0 0 ) 30 June 2022 30 J u n e 20 21 nt Revenue 8,820 8,298 522 Revenue increase is $0.5m or 6% over comparable period Co s t o f s a le s (1,042) (1,364) 322 Gross profit 7,778 6,934 844 O p e ra t in g e xp e n s e s (O p e
Slide 18: H1 2022 Group Cash and Cash Flow from Year End
H1 2022 GROUP CASH and CASH FLOW from YEAR END • Gross cash decrease in half of $3.7m from year end position. • Cash reduction due to decrease in working capital (driven by FX and reduction in deferred income), investment in capex and R&D, scheduled repayment of loans • Partially offset by non-cash
Slide 19: H1 2022 Group Balance Sheet: Net Assets
H1 2022 GROUP BALANCE SHEET: NET ASSETS Movement on the capitalised development Movement consists of $0.8m of additions (engineering R&D As at As at Unaudited ($’000) 30 June 2022 30 June 2021 between effort), less $0.9m of amortisation, FX of $0.1m halves Goodwill and acquired intangibles assets 8,
Slide 20: The Corero Offering
THE CORERO OFFERING
Slide 21: Protection for All Environments
PROTECTION FOR ALL ENVIRONMENTS APPLIANCES INFRASTRUCTURE CLOUD SmartWall TDS physical or SmartWall TDD virtual SmartWall TDC protects virtual software solution software solution protects inbound traffic from protects inbound traffic with inbound traffic by enabling saturation attacks by always-on b
Slide 22: Broadest On-Prem Product Portfolio
BROADEST ON -PREM PRODUCT PORTFOLIO For any network topology from Gigabit to tens of Terabits Inline (TDS) Datapath (TDS) Edge (TDD) Scrubbing (ETD) • Appliance protects transit • Appliance protects traffic • No Edge Appliances • No Edge Appliances • Protects Full Edge b/w • Protect Full or % Edge b
Slide 23: Competition & Differentiation
COMPETITION & DIFFERENTIATION
Slide 24: SmartWall DDoS Protection Benefits
SMARTWALL DDoS PROTECTION BENEFITS SPEED & ACCURACY SCALABILITY Purpose Built, Automatic, Real-Time, Always-On Modular & Distributed, Pay as You Grow Protection Protection Keeps Applications and Services Running Corero offers up to 40Tbps of always-on protection, at the best Corero mitigates attacks
Slide 25: Most DDoS Attacks Don't Grab the Headlines
MOST DDoS ATTACKS DON’T GRAB THE HEADLINES 13% 86% 98% 68% INCREASE IN MULTI- OF ATTACKS <10 ATTACKS UNDER CHANCE OF REPEAT VECTOR ATTACKS MINUTES 10GBPS ATTACK WITHIN A SmartWall’s fast, SmartWall’s ability to SmartWall’s always on WEEK accurate and automatic react and mitigate deep packet inspecti
Slide 26: Strategy & Growth
| STRATEGY & GROWTH =
Slide 27: Strategy for Growth
STRATEGY FOR GROWTH VERY SOLID FOUNDATIONS BUILT OVER THE LAST 8 YEARS » Broadest on-prem DDoS protection solution portfolio » Leading superior performance/TCO ratio in the industry » Very strong base of customers with a high level of recurring business » An experienced team of experts in all the op
Slide 28: Strategic Pillars for Growth
STRATEGIC PILLARS FOR GROWTH: “CUSTOMERS CENTRIC & NEW BUSINESS 1. Increase our international presence 2. Leverage our existing partnerships and adding new strategic partnerships 2. 3. Expand our Global, Tier One and major accounts relationships 4. 4. Augment our services portfolio 5. 5. Amplify our
Slide 29: Summary & Outlook
SUMMARY & OUTLOOK
Slide 30: Summary & Outlook
SUMMARY & OUTLOOK FY 2020 & FY 2021 & H1 2022: A NEW CONSISTENT TRACK RECORD » More than two consecutive years of strong financial and operational performance supported by our growth and customer centric strategy » Became profitable in FY 2021 delivering performance in line with market expectation O
Slide 31: Disclaimer
DISCLAIMER Certain statements included or incorporated by reference within this presentation may constitute “forward-looking statements” in respect of Corero’s operations, performance, prospects and/or financial condition. By their nature, forward-looking statements involve a number of risks, uncert
Slide 32: Thank you!
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Slide 33: Corporate Appendix
CORPORATE APPENDIX
Slide 34: What is a DDoS Attack
WHAT IS A DDoS attacks are a threat to service availability, network security DDoS ATTACK and business continuity, impacting brand reputation and ultimately lead to lost revenues. SSDP AMPLIFICATION DDOS ATTACK A Distributed Denial of Service (DDoS) attack is a cyber threat, in which multiple comput
Slide 35: Corero's SmartWall Portfolio
CORERO’S SMARTWALL PORTFOLIO THREAT DEFENSE SYSTEM (TDS) THREAT DEFENSE DIRECTOR (TDD) Physical & Virtual Appliances – On-premises Provider Edge – Sampled Detection 1G 10G 100G 100G > Multi -Tbps + TDS220 NTD280 NTD1100 » Standalone 2x1/10G Solution » Up to 16x10G Protection » Up to 2x100G Protectio
Slide 36: 20+ Years of Evolving DDoS Attacks
20+ YEARS OF EVOLVING DDoS ATTACKS
Slide 37: SmartWall Scalable Solution Architecture
SMARTWALL SCALABLE SOLUTION ARCHITECTURE REAL-TIME ALERTING, HISTORICAL REPORTING, BEHAVIORAL ANALYSIS Analytics & Reporting Technolog y Partner Engine AUTOMATED PROVISIONING EVENT & ALERT REPORTING WEB USER INTERFACE Automation & Provisioning System NETWORK THREAT DEFENSE APPLIANCE Do-No-Harm Detec
Slide 38: Management Team
MANAGEMENT TEAM
Slide 39: Corero's Management Team
CORERO’S MANAGEMENT TEAM Lionel Chmilewsky CEO Tanya Alfonso Ashley Stephenson Julian Palmer João Melo Andrew Miller CRO CTO EVP of Engineering EVP of Operations Interim CFO & Customer Services Brian Hawthorne Erik Britt -Webb Steve Mulhearn Sean Newman Head of Marketing VP, Strategic Alliances & VP
Slide 40: Shareholder Information
SHAREHOLDER INFORMATION KEY METRICS PRINCIPAL SHAREHOLDINGS (>3% DISCLOSED) » Ticker: CNS.L, Market: AIM (London) » Total management: 38.59%: » Sector: Software and Computer Services • Jens Montanana, Chairman: 37.85% » Share price (at time of preparation): 10.00p • Other Board members total: 0.74%
Slide 41: Board Composition: Executives
BOARD COMPOSITION EXECUTIVES Lionel Chmilewsky CEO Lionel has 30 years of international experience in the technology field, in particular in the Infrastructure, Software and Services domains. Most recently Lionel was CEO of Cambridge Broadband Networks Ltd, a leader in wireless solutions based in th
Slide 42: Board Composition: Non Executives
BOARD COMPOSITION NON EXECUTIVES Jens Montanana Chairman (appointed 9 August 2010) Jens Peter Montanana (non-executive Chairman) is the founder and CEO of Datatec Limited, established in 1986. Between 1989 and 1993 Jens served as managing director and vice-president of US Robotics (UK) Limited, a wh
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