Slide 1: M&A Process and Corporate Development
M&A Process and Corporate Development Jeremy Segal EVP, Corporate Development April 4, 2023 People. Proven. Progress.
Slide 2: Repeatable M&A Process Drives Deal Pipeline
Repeatable M&A Process Drives Deal Pipeline Tools and Resources Strong Relationships Disciplined M&A Framework © 2023 Progress Software Corporation and/or its subsidiaries or affiliates. All rights reserved. 2
Slide 3: Large Opportunity Set Provides Attractive and Durable Pipeline
Large Opportunity Set Provides Attractive and Durable Pipeline • From 2016 to 2020, VCs invested $135B in 18,000 Year Company Deal Capital Invested companies within Count Count (US$ in mm) infrastructure software 2022 4,465 5,000 $54,446 Best-in-Class Well Strong 2021 4,776 5,619 79,063 • Significan
Slide 4: Proven. Committed. Ready to Close.
Proven. Committed. Ready to Close. Total Growth Strategy Pillars Disciplined M&A 1. Invest and Innovate • Experienced corporate development team that has overseen M&A with >$10B 2. Acquire and Integrate in aggregate transaction value 3. Drive Customer Success • Strong top of funnel with healthy pipe
Slide 5: Well Defined M&A Framework
Well Defined M&A Framework • High recurring revenue and customer retention Financial Characteristics • Potential to achieve operational efficiency • Cast a wide net across infrastructure software/all End Market aspects of the software development lifecycle Alignment • Tight alignment increases syner
Slide 6: Focus on Integration and Cost Synergy Realization
Focus on Integration and Cost Synergy Realization END STATE VISION Integration Guiding Principles 30/60/90 day; 12-month Integration Plan Protect the business Plan comprehensively and execute rapidly Day 1/Week 1 Readiness Communication and transparency Provide leadership at all levels Achieve resul
Slide 7: Kudos to the Progress team on the quality of their communications
Kudos to the Progress team on the quality of their communications. This has been the most positive, well-planned and comprehensive communication cascade I’ve ever seen. Operations Principal, PE Firm © 2023 Progress Software Corporation and/or its subsidiaries or affiliates. All rights reserved. 7
Slide 8: M&A Track Record
M&A Track Record MarkLogic ~12.5% Revenue Revenue R CAG $611M ~$684M* Kemp Revenue $557M $4.13 Chef EPS Ipswitch Revenue Revenue $456M $432M Total Growth Strategy Implemented Revenue $379M $2.19 EPS FY '18 FY '19 FY '20 FY '21 FY '22 FY '23E All financial results shown are on a non-GAAP basis * Mid-
Slide 9: Successful Track Record of Value-Added Acquisitions
Successful Track Record Successful Track Record of Value- of Value-AddedAdded Acquisitions Acquisitions About Ipswitch About Chef About Kemp About MarkLogic • Network monitoring and • DevOps and DevSecOps • Load balancing, network • NoSQL database and managed file transfer performance, detection met
Slide 10: Progress is an Acquirer of Choice
Progress is an Acquirer of Choice Speed & High Strong Unwavering Certainty Customer Employee to Close ÇÇ Loyalty Commitment Our acquisition model prioritizes A deep infrastructure software product Our high employee retention rate, speed, efficiency and high certainty-to- portfolio, exceptional custo
Slide 11: Testimonials on the diligence and integration process
Throughout the entire diligence process, Progress was incredibly thoughtful the full diligence team is much more throughout the entire integration process. engaged, thorough and collaborative as The employee onboarding experience was compared to many of its peers. They really highly informative and
Slide 12: Perspectives on 2023 M&A Environment
Perspectives on 2023 M&A Environment Expect more VC-backed Multiple reports suggest Reticence from other "buyers" ÇÇ to do deals amid greater companies to come to greater sell-side activity market with more rational macro-economic conditions valuation expectations Anticipate market conditions to tre
Slide 13: Summary
Summary Well positioned to Generating Disciplined M&A Targeted financial leverage scale positive results process, with criteria provides and experience from the prudent robust pipeline of roadmap for to extract application attractive growth success (ROIC > operating and of our M&A opportunities WACC
Slide 14: D Progress
D Progress
Slide 15: Disclosure Slides
Disclosure Slides Safe Harbor / Forward Looking Statements GAAP/non-GAAP Reconciliation
Slide 16: Forward Looking Statements
Forward Looking Statements This presentation contains statements that are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Progress has identified some of these forward-lookin
Slide 17: Important Information Regarding Non-GAAP Financial Information
Important Information Regarding Non-GAAP Financial Information Progress furnishes certain non-GAAP supplemental information to its financial results. We use such non-GAAP financial measures to evaluate our period-over-period operating performance because our management team believes that by excludin
Slide 18: Important Information Regarding Non-GAAP Financial Information
Important Information Regarding Non-GAAP Financial Information • Cyber incident - We exclude certain expenses resulting from the detection of irregular activity on certain portions of our corporate network, as more thoroughly described in the Form 8-K that we filed on December 19, 2022. Expenses inc