Kore Group Holdings, Inc. · NYSE:KORE
Kore — Investor Presentation (November 2022)
27 slides from Kore's investor presentation, Nov 16, 2022
Slide 1: Investor Presentation
Investor Presentation 1 November 16, 2022
Slide 2: Disclaimers
Disclaimers 2 Forward-Looking Statements This presentation includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. KORE's actual results may differ from their expectations, estimates and projections and consequ
Slide 3: KORE at a glance
Attractive Story • Significant barriers to entry and sustainable competitive moat • Well positioned to capture market share in Connected Health and Fleet • Predominately recurring revenue with high switching costs • Q3’22 Total Net Leverage of 5.8x • Robust free cash flow and deleveraging ability KO
Slide 4: Product lines and pricing method
Primary pricing methodProduct line Product description IoT Connectivity 68% of 20211 65% of Q3 20222 Per subscriber per month for lifetime of device (7-10 years and growing) Multi-year contracts with automatic renewals IoT Solutions 32% of 20211 35% of Q3 20222 • IoT connectivity services offered th
Slide 5: Well positioned in the early innings of an IoT growth opportunity
KORE is well positioned in the early innings of an exciting growth opportunity in IoT 5 2020 2025 2030 TA M ($ bn ) De vi ce s (b n) Applications & Platforms Managed Services Connectivity $906B ~$7 Trillion $382B $78B $35B $269B $250B $608B $48B IoT Devices = 12 billion Connected Devices = 22 billio
Slide 6: IoT use cases are everywhere, deployments are complex
IoT use cases are everywhere… deployments are complex • Top challenges in IoT deployments Inability to contextualize and analyze data Challenges in interoperability and compatibility Lack of solution deployment planning and experience Issues in compliance with regulations Fragmented ecosystem requir
Slide 7: Building the world's first pure-play IoT enabler
7 KORE is building the world’s first pure-play IoT enabler Connectivity. Solutions. Analytics. How we do it… ScaleManageDeploy What we do for customers...
Slide 8: Successful IoT Deployments Require Key Steps
Successful IoT Deployments Require 7 Key Steps • How these services are delivered through KORE and Partners 8Delivery: KORE Internal KORE & Partner Hybrid Partner 1.1 Business Outcomes / Business Case 2.1 Architecture 3.1 Network(s) Selection / Carrier Contracts 4.1 Forecast Management 5.1 Technical
Slide 9: KORE is the only pure play IoT enabler
Enterprises IoT Applications Analytics Visualization IoT & Enablement Onboard Configure Monitor Manage Secure Deployment & Edge Device Management KORE KORE fully delivers 25 of the 49 steps required to deploy an IoT Solution, and partners with others to deliver another 19 steps. KORE can help manage
Slide 10: Five focus industry sectors growing fast
KORE’s five focus industry sectors, representing 80%+ of the IoT market, are growing fast 5G will drive significant new use cases in mission critical applications across KORE’s target industries Industry Vertical 2020P-2025P Market CAGR Internet of Things Use Cases 34.2% 29.4% 22.4% 17.5% 17.3% Remo
Slide 11: Customer case study: Customer #1
Customer case study: Customer #1 KORE global connectivity • Provided a global connectivity package to provide connectivity across a large number of countries • Acting as a trusted advisor for customer with transition of 2G/3G devices to LTE (in 2021/22) • Almost 1 million subscribers and growing fas
Slide 12: Customer use case: Cardiac rhythm monitoring
Customer use case: Cardiac rhythm monitoring KORE Service DeliveryDelivery: 12 Hardware Customization, Certifications – Gen 9 Demand Forecast Supply Chain Deployment Setup & Optimization Subscription Lifecycle Integration Network Design Roaming Footprint Updates Wireless Managed Services OPCO Billin
Slide 13: Strategy for KORE 3.0 finalized
Strategy for “KORE 3.0” finalized Transformation program and investments approved One Team KORE; high- performance culture Begin transformation of connectivity proposition / platform Integrate acquisitions including Aspider, bring eSIM to market Launch IoT Solutions & Managed Services Acquisition/in
Slide 14: Q3 financial performance
14 Q3 financial performance Revenue % Revenue % Revenue % Revenue % IoT Connectivity $43.4 65% $41.5 61% $133.4 65% $125.6 68% IoT Solutions 23.3 35% 26.3 39% 72.5 35% 58.3 32% Total revenue $66.6 100% $67.9 100% $205.9 100% $183.9 100% Gross Margin % IoT Connectivity IoT Solutions Overall Gross Mar
Slide 15: a ee ee
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Slide 16: KORE's Technology Stack Enables IoT Services
16 KORE’s Technology Stack Enables IoT Services IoT Devices / Other Devices SIM, eSIM, iSIM Enterprise / Solution Provider Applications KORE One Streaming KORE One Aggregator Platform Functions AnalyticsBilling Network IntelligenceIntegration Carriers Enterprise Apps KORE One Interface (User experie
Slide 17: Intellectual property designed to enable customer outcomes
17 Intellectual property designed to enable customer outcomes Edge Global Connectivity Comprehensive Data Management Services Security and Network Intelligence Location Based Services KORE One Services Connected Health Services Customer Outcomes End-to-end IoT Solutions Dev Ecosystem Pu bl ic R es t
Slide 18: KORE's comprehensive offering is without peer in today's market
18 KORE’s comprehensive offering is without peer in today’s market 18 IoT Strategy & End-to-End security Analysis & Optimization Technology, Evaluation, Selection, Dev Connectivity, Device & Data Management Deployment (forward logistics) Operations Management & Support Sustainment (reverse logistics
Slide 19: Key Highlights
19 IoT market is accelerating, driven by significant tailwinds for the next decade1 Leading IoT offering, backed by extensive IP, creates sustainable competitive moat2 Well-diversified customer base3 Highly recurring revenue with long term visibility4 Long track record of customer retention5 Key Hig
Slide 20: IoT market is accelerating, driven by significant tailwinds
• CaaS(1) - Licensed - Unlicensed - Satellite • CEaaS (2) - CNaaS - CMPaaS - PNaaS • IoT Solutions (3) - Managed Services - Analytics 20 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 C on ne ct io ns (M illi on s) IoT market is accel
Slide 21: Leading offering, backed by extensive IP, creates sustainable competitive moat
Leading offering, backed by extensive IP, creates sustainable competitive moat 21 • ConnectivityPro service and related APIs • eSIM technology stack/ proprietary IP • Hypercore technology Connectivity IoT Solutions • Deep industry vertical knowledge and experience ‒ Connected Health – FDA, HIPAA, IS
Slide 22: Well-diversified customer base
22Source: Company financials Well-diversified customer base • Outside of Customer 1, which has been a KORE customer for 10+ years, no customer contributes more than 3% of total revenue • Despite Customer 1 comprising 21% of fiscal 2021 revenue, its gross profit contribution is significantly lower at
Slide 23: Highly recurring revenue with long term visibility
~85% annual recurring revenue and ~97% installed base as of 2021 23 Highly recurring revenue with long term visibility $206 $214 $248 $126 $138 $151 $47 $55 $79 $32 $21 $18 2019A 2020A 2021A IoT Connectivity IoT Solutions Non-Core Customers ($mm) KORE’s Top 10 customers have been with the company on
Slide 24: Long track record of customer retention
24 Long track record of customer retention 103% 103% 106% 108% 113% 114% 122% 122% 114% 100% 112% 110% 115% 114% 109% 106% Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 DBNER DBNER excluding largest customer Revenue impact from the significant LTE Transition Program
Slide 25: Global Sales Pipeline as of Sep 30th, 2022
Global Sales Pipeline as of Sep 30th, 2022 25 Total Qualification & Technical Evaluation Stage Proposal Stage Contract Signed Stage Beta Site Stage Total Closed Won $72MM TCV Closed Won 1,321 Opportunities $407MM TCV
Slide 26: Reconciliation of Net Loss to EBITDA, Adjusted EBITDA
Reconciliation of Net Loss to EBITDA, Adjusted EBITDA 26 Columns may not sum due to rounding (In milliopns USD) 2022 2021 2022 2021 Net loss ($13.0) ($4.5) ($35.1) ($12.5) Net loss margin (19.6%) (6.6%) (16.1%) (6.8%) Income tax benefit (2.5) (3.7) (7.8) (7.6) Interest Expense 8.2 5.6 22.1 16.2 Depr
Slide 27: Financial Policy Overview
27 Financial Policy Overview Leverage • Target senior net leverage(1) of ~3x within ~24 months • Target total net leverage(2) of ~4x within ~24 months M&A • Target ‘tuck-in’ opportunities to expand geographically, build out capabilities in industry verticals, enhance technical and analytical know-ho
KORE Group Holdings — Investor Presentation (November 2022) on 6ix