Slide 1: TZ Limited ASX lodgement cover letter
TZ Limited ABN 26 073 979 272 24 February 2015 Lodged by ASX Online For personal use only The Manager Company Announcements Office ASX Limited Level 4, 20 Bridge Street Sydney, NSW 2000 Dear Sir/ Madam, Please find attached TZ Limited’s 1H FY2015 results presentation for the investor conference call
Slide 2: TZ Limited 1H FY15 Preliminary Results
For personal use only TZ LIMITED 1H FY15 PRELIMINARY RESULTS 24th February 2015 “After substantial investment and development, this is an exciting time at TZ. Supported by global structural tailwinds, major recent contract wins and a strong pipeline of opportunities, revenue growth is accelerating a
Slide 3: What We Will Cover
For personal use only What We Will Cover 1 2 3 4 5 TZ Business 1H FY15 Financial Operational Progress Against Conclusions and Overview Performance Highlights Objectives Outlook Slide | 2
Slide 4: TZ Business Overview
For personal use only TZ Business 1 Overview Slide | 3
Slide 5: Our Business … Business Streams
For personal use only Our Business … Business Streams infrastructure Data Centre Rack Security Company Purpose protection market size: ~ 25M installed base TZ is the leader in SMArt Device™ technology + 2M new cabinets per year combining state-of-the-art SMA actuated addressable opportunity: > US$
Slide 6: Think Smart. Think TZ Locking.
For personal use only Think Smart. Think TZ Locking. Slide | 5
Slide 7: Think Smart Lockers. Think TZ
For personal use only Think Smart Lockers. Think TZ Slide | 6
Slide 8: TZ at a glance
For personal use only TZ at a glance + Accelerating revenue growth IP protected platform: Strategically coupled with client’s in high growth market sectors: Only SMA actuated electronic business due to tight software Cloud Computing, E-Commerce locking devices in the world integration Retained and r
Slide 9: 1H FY15 Financial Performance
For personal use only 1H FY15 Financial 2 Performance Slide | 8
Slide 10: Financial Performance
For personal use only Financial Performance 2015 2014 Half Year Half Year Change % REVENUE A$7.64M A$3.33M 129% NPAT (A$3.69M) (A$5.05M) 27% EPS (cents) (0.96) (2.43) 60% Slide | 9
Slide 11: Sales by Business Unit
For personal use only Sales by Business Unit Revenue is tracking positively towards the upgraded guidance of A$18M to A$20M for FY2015. 2015 Half Year 2014 Half Year Change % IXP REVENUE A$0.8M A$1.0M 20% PAD REVENUE A$6.5M A$2.0M 225% INFINITY REVENUE A$0.3M A$0.3M No Change TOTAL A$7.6M A$3.3M
Slide 12: Revenue Growth
For personal use only Revenue Growth A$6.5M A$6M infrastructure packaged asset protection delivery A$5M A$1.0M to A$0.8M A$2.0M to A$6.5M A$4M Backlog: A$0.3M Backlog: A$2.3M IXP sales are slightly down on the The PAD business continues to same period last year but this is exceed expectations, more
Slide 13: Investing for Growth
For personal use only Investing for Growth 2015 2014 Half Year Half Year Change % OPERATING REVENUE A$7.64M A$3.33M 129% 13% COST OF GOODS 63% 72% GROSS MARGIN 37% 28% 32% EMPLOYEE BENEFITS EXPENSE A$3.82M A$2.18M 75% OCCUPANCY EXPENSE A$0.17M A$0.14M 21% COMMUNICATIONS EXPENSE A$0.07M A$0
Slide 14: Gross Margin Analysis
For personal use only Gross Margin Analysis 60% Normalised GM = 50% 50% 40% 30% Increased operating cost at calendar year end are a result 20% of forward building inventory and advance raw materials purchases to manage supply over the Christmas / January 10% and Chinese New Year shut downs. Jul to D
Slide 15: Cash Flows
For personal use only Cash Flows $3M Customer Receipts The Company is on track to profitability as $2M revenue grows in line with expectations. Available cash on hand should support achievement of the fiscal 2015 revenue $1M guidance with tight expenditure control. 0 Jan to Mar ‘14 Apr to Jun ‘14 Ju
Slide 16: Accelerating Growth
For personal use only Accelerating Growth Funding raised through the share purchase A$XXM plan will provide TZ with the additional working capital to allow the Company to fully exploit the window of opportunity that currently exists for Locker solutions in the market A$30M > A$18M A$20M A$8.5M A$10M
Slide 17: Operational Highlights
For personal use only Operational 3 Highlights Slide | 16
Slide 18: 1H FY15 Major Events
For personal use only 1H FY15 Major Events JUL New patents granted covering a range of shape memory alloy actuated fasteners, fastening and locking systems and fastener assemblies SEP Purchase order for the supply of an electronic locking solution and software management system for employee day lock
Slide 19: Packaged Asset Delivery smart locker solutions
For personal use only packaged asset delivery PAD delivers smart locker solutions for ... corporate residential government and institutional retail postal and logistics Slide | 18
Slide 20: PAD Sales Highlights
For personal use only PAD Sales Highlights Europe Successful Parcel Locker deployment for Poste Italiane, Paccomat North America Asia Expanding business with Complete delivery of 100 world recognised IT and POPStation Locker Banks technology corporations for in Singapore for Sing Post Corporat
Slide 21: Product Development
For personal use only Product Development Next Generation Parcel Locker System focusing on … System Performance System Cost Slide | 20
Slide 22: Infrastructure protection IXP solutions
For personal infrastructure use only protection IXP solutions offer data cabinet level ... TZ Praetorian™ System locking for integration with 3rd party access control systems sensing remote management delivers: security real-time monitoring reporting compliance TZ Centurion™ System r
Slide 23: IXP Sales Highlights
personal use only Europe IXP Sales ForHighlights Expansion of distribution network in Europe to support broader opportunity harvesting Secure first SwingHandle OEM agreement with U-Systems Limited North America Steady growth with US Asia Govt, Defense, Banking Initial stocking order from and
Slide 24: Progress Against Objectives
For personal use only Progress Against 5 Objectives Slide | 23
Slide 25: Key Priorities
For personal use only Key Priorities OBJECTIVE PROGRESS Focus on revenue growth IXP: Secured first OEM agreement for TZ SwingHandle, currently pursuing other OEM relationships Pursue service and maintenance contracts with existing installed IXP customer base PAD: Aggressively expanding sales t
Slide 26: Key Priorities
For personal use only Key Priorities OBJECTIVE PROGRESS Improve manufacturing cost Initial pilot production successful from China based contract manufacturer … Full production anticipated in Q4 Now manufacturing TZ moulded device components from China at improved manufacturing cost Established
Slide 27: Key Priorities
For personal use only Key Priorities OBJECTIVE PROGRESS Explore partnership opportunities Currently exploring a number of new strategic partnering opportunities offerings to access new application areas Engaging in initial discussions with a major Service Provider to explore licensing opportunit
Slide 28: Outlook and Conclusions
For personal use only Outlook and 5 Conclusions Slide | 27
Slide 29: Outlook and Conclusions
For personal use only Outlook and Conclusions 1H FY15 continues to maintain the strong momentum of FY14 Revenue guidance reaffirmed for FY2015 … at the upgraded target > $18M Aggressively focus on strong revenue growth opportunities: US market – Corporate and Residential Lockers Australian
Slide 30: Appendix
For personal use only APPENDIX Slide | 29
Slide 31: IXP New Projects / Existing Client Potential
For personal use only IXP New Projects / Existing Client Potential 2015 to 2018 Horizon (1H FY15 update) Project Description Sales Potential IXP, NORTH AMERICA Financial Institutions and Telco Projects North American Government Entities (Federal, State and City) $7M Sales through Distribution, OEM’s
Slide 32: PAD New Projects / Existing Client Potential
For personal use only PAD New Projects / Existing Client Potential 2015 to 2018 Horizon (1H FY15 update) Project Description Sales Potential CORPORATE LOCKERS, USA Expansion projects from existing Technology, IT and Financial Institution customers $20M RESIDENTIAL LOCKERS, USA National expansion of
Slide 33: Anatomy of a Deal
For personal use only Anatomy of a Deal … infrastructure protection Evaluation Pilot DC Roll-Out Standardisation 10 to 20 Cabinets 50 Cabinets 500 to 1000 Cabinets > 1000 Cabinets Stand-Alone Integrated into Roll-out to all DC Trial DCIM System New and Retrofit Server Software Investment in Back-End
Slide 34: Annuity Revenue
Annuity Revenue … For personal use only Annuity = SW Maintenance Fees Y1+Y2+Y3 + Service / Support Fees Annuity = Target 10% of Capital Purchases Y1+Y2 Y1 Annuity Annuity Y1 Capital Purchase Revenue Growth Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Slide | 33
Slide 35: Important Notice
For personal use only Important Notice The information contained in this presentation is given in good faith and has been prepared from information believed to be accurate and reliable. The information presented does not take into account your individual financial circumstances and it is not designe
Slide 36: 1H FY15 Results Investor Conference Call transcript
TZ Limited ABN 26 073 979 272 1H FY15 Results Investor Conference Call For personal use only MARK BOURIS Good morning everybody. Thank you for joining us today on the TZL Half Year 2015 Results investor call. We appreciate your time and your interest in the Company. My name is Mark Bouris and I’m th
Slide 37: Call transcript: PAD business and model
TZ Limited ABN 26 073 979 272 Our other business, the PAD business, delivers a range of automated intelligent locker solutions, across an extensive range of applications from Accountable Mail and Day Lockers for our corporate clients, Concierge Lockers for High Density Residential, Smart Lockers for
Slide 38: Call transcript: business model and funding
TZ Limited ABN 26 073 979 272 And finally … we are creating a capital light high return business model with high barriers to entry and long tail, recurring annuity style revenue streams. Our investment in technology and proprietary software offerings embed us in our customers’ infrastructure, workpl
Slide 39: Call transcript: growth and financial metrics
TZ Limited ABN 26 073 979 272 SLIDE 11 This is a graphical representation of how the TZ business has grown over the last few years. With the exception of our IXP business which has been impacted by project phasing, you can see both businesses have exhibited the high growth characteristics that you w
Slide 40: Call transcript: cash flow and funding
TZ Limited ABN 26 073 979 272 SLIDE 14 We’ve been able to manage our cash flow reasonably successfully and to balance advance purchases against when we receive payments from our customers, which is typically when the systems are deployed. Unlike many other companies, TZ does not have the ability to
Slide 41: Call transcript: PAD business
TZ Limited ABN 26 073 979 272 SLIDE 18 Let’s talk firstly about our PAD business or Packaged Asset Delivery business - our smart locker business. For personal use only This business is about selling turn-key solutions that comprise metal and/or MDF lockers, the electronic locking hardware and techno
Slide 42: Call transcript: postal lockers and Australia
TZ Limited ABN 26 073 979 272 While we are in new discussions with Singapore Post about expansion of the POPStation network in 2015, we are about to embark on the delivery of the first Locker Banks for Pos Malaysia following our tender win and completion of contract negotiations. With the securement
Slide 43: Call transcript: objectives progress
TZ Limited ABN 26 073 979 272 Although this represents the first agreement across the line, it does validate our SwingHandle™ proposition of a mechanical cabinet lock with an electronic upgrade path. SLIDE 23 For personal use only Turning to an update on our progress against objectives. At the start
Slide 44: Call transcript: conclusion
TZ Limited ABN 26 073 979 272 enable us to achieve greater customer engagement and explore applications outside the current scope of participation. While these deals take time to nurture and develop, the initiative remains a priority for the Company. For personal use only SLIDE 27 I’d like to hand b