West Holdings Corporation · TSE:1407
West — Investor Day (February 2017)
54 slides from West's investor day presentation, Feb 28, 2017
Slide 1: Analyst Day February 28, 2017
Analyst Day February 28, 2017 Exhibit 99.1
Slide 2: west
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Slide 3: Forward Looking Statements and Non-GAAP Financial Information
Forward Looking Statements and Non-GAAP Financial Information This presentation contains forward-looking statements within the meaning of federal securities laws, which are subject to risks and uncertainties. All statements other than statements of historical facts contained in this presentation are
Slide 4: Agenda
Agenda 4 Welcome – Dave Pleiss Overview – Tom Barker Safety Services – Ron Beaumont Interactive Services – Skip Hanson Break Conferencing & Collaboration / UCaaS – Scott Etzler Healthcare Advocacy – Matt Yost Healthcare – Nancee Berger Finance – Jan Madsen Wrap Up / Q&A – Tom Barker Lunch
Slide 5: West Corporation Overview
West Corporation Overview West Corporation is a global provider of communication and network infrastructure services. West helps its clients more effectively communicate, collaborate and connect with their audiences through a diverse portfolio of solutions that include unified communications service
Slide 6: 2016 Business Highlights
Revenue from UCaaS, Safety, Interactive and Specialized Agent businesses increased 8% Growth Business Performance Acquisitions In March, acquired Synrevoice Technologies, a leading provider of K-12 notifications in Canada In December, acquired 911 ETC, a leading provider of E9-1-1 services for the e
Slide 7: Today's Themes
Today’s Themes Exciting Growth Opportunities Across Portfolio Strong Cash Flow Capital Allocation to Drive Shareholder Value Continued Commitment to Operational Excellence
Slide 8: How West Approaches Distinct Market Profiles
Mature Markets Growth Markets Focus on efficiency and operational excellence Maintain above-market growth rates Pursue synergistic bolt-on acquisitions Optimize allocation of significant cash flow generation Commitment to constant innovation and product rollouts to capture share Leverage customer re
Slide 9: West Corporation Overview
West Corporation Overview Conferencing & Collaboration Interactive Services Safety Services Health Advocate Solutions #1 in global conferencing and collaboration services Best-in-class margin profile and significant cash generation Clear leader in multiple markets (Carrier, Government, NG9-1-1) Clea
Slide 10: Market Profile and Strategic Agenda by Business
Conferencing & Collaboration UCaaS Interactive Services Safety Services Specialized Agent Services Market Profile Strategic Agenda Audio conferencing market is $3.8B, declining at 4% CAGR1 Web conferencing market is $3.3B, growing at 6% CAGR1,2 West estimated long-term growth rate of 0% to -4% Manag
Slide 11: Near-Term Outlook
Near-Term Outlook Driving shareholder value by delivering on identified growth opportunities and operational improvement initiatives in 2017 and beyond 2017 Guidance Highlights Organic revenue growth from non-conferencing businesses is expected to be in the mid- to high-single-digits in 2017 Confere
Slide 12: Disciplined Capital Allocation Strategy
Disciplined Capital Allocation Strategy Investment in propriety platforms and technology to achieve long-term growth rate targets Pursue accretive acquisition opportunities to further accelerate revenue growth and scale Debt paydown to decrease interest expense and drive growth in EPS Dividend to sh
Slide 13: Safety Services
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Slide 14: Safety Services
$296MM 2016 Revenue $79MM 2016 Adjusted Operating Income 26.6% Adjusted Operating Margin Manage more than 200MM telephone numbers Connect calls to more than 6,000 PSAPs Facilitated more than 444MM 9-1-1 transactions last year Delivered the first text-to-9-1-1 message Key Highlights Clear leader in m
Slide 15: Comprehensive Set of NG9-1-1 Services
PSAP gets call and dispatches Call Handling Equipment to receive NG9-1-1 calls GIS Solutions GIS location services for data and maps Additional info to responders Supplemental Data Services Video, photos, security cameras, blueprints Call or text is made Text-to-9-1-1 Support for SMS messages to 9-1
Slide 16: Enterprise 9-1-1
9-1-1 solutions for the fast-growing enterprise Unified Communications/VoIP market Helping enterprises with VoIP telephony systems maintain accurate user-location information for 9-1-1 West expects the Enterprise 9-1-1 market to double in the next five years West is the leader in Enterprise 9-1-1, s
Slide 17: Safety Services addressable markets
Significant increase in addressable markets expected, with strong performance in legacy services. Advanced Services NG 9-1-1 Government Solutions Carrier Services $50-100MM in 2016, expected to triple by 2020 Key Drivers: Overhaul of legacy 9-1-1 infrastructure $500MM in 2016, expected to grow high-
Slide 18: Safety Services growth opportunities
Strong foundation for growth with current initiatives; multiple opportunities to leverage existing infrastructure and core competencies for additional growth Execute Enterprise 9-1-1 growth strategy Drive NG9-1-1 adoption, continue ESInet rollouts Ramp new routing solutions (TXT29-1-1, VoWiFi, VoLTE
Slide 19: Interactive Services
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Slide 20: Interactive Services
Interactive Services $301MM $56MM 18.7% Over 64MM unique lives touched every month 17 of 20 Largest utilities in U.S. as clients 6.3 Billion transactions delivered in 2016 Education platform reaches 90MM parents, students and staff Key Highlights Diverse vertical alignment and market leadership acro
Slide 21: Creating Connected Customer Experiences
Consumers interacting with brands: Social media Text message Email Phone calls Web chat Wearables Website Helping clients envision, design and deliver differentiated experiences Multi-Channel platforms, applications and services across Inbound and Outbound Cloud Contact Center Professional services
Slide 22: Interaction Volume and Human Impact
Interaction Volume and Human Impact & 6.3B 69M unique customer lives touched in December 2016 up 24% YOY transactions in 2016 Interactive Services
Slide 23: Consumer and Industry Trends
Consumer and Industry Trends Sources: 1. Walker Information 2. Gartner 3. Pew Research 4. Dimension Data 2015 Global Contact Centre Benchmarking Report 5. Understanding Global Millennials 2014, SDL 6. Business Insider 7. Periscope, McKinsey 2016 8. McKinsey 2020 When customer experience will surpass
Slide 24: Consumerism – Digital and Connected
Consumerism – Digital and Connected Always-On Approach Personalized Service Segmented & Differentiated Offers Data and Analytics Driven Configurable / Cloud-based Customer Expectations Interactive Services
Slide 25: Market Size: Interactive Services
North America and Western Europe regions only 1 Gartner, Forrester, Internal Estimates 2 Internal Estimates ~$1.1B addressable market spanning Inbound, Outbound, Access/Contact Center Modernization, Medication/Vaccine Adherence, Patient Experience and Care Plan Gap Closure2 ~$600-720M addressable ma
Slide 26: Connected Customer Experience
Helping clients envision, design and deliver differentiated experiences Connected Customer Experience Growth Consumers, Patients and Parents Interaction Discovery Attraction Purchase Use Cultivation Support Awareness Advocacy Marketing Service Provide and Connect opportunities across the Customers’
Slide 27: Growth drivers: Healthcare, Commercial, Utilities
Healthcare Commercial + Utilities Growth driven by: Broad suite of consumer experience solutions and services Market leadership position in Healthcare, Education, Commercial and Utility verticals Market share gains from smaller and sub-scale providers with point solutions True omni-channel technolog
Slide 28: Interactive Services growth initiatives
New client acquisitions in core offerings Existing account growth / upsell additional services New product and service launches Sell programs and services to new buyers within clients Grow the reseller/channel programs Cloud Contact Center services New product and service innovation Growth in adjace
Slide 29: we connect. we deliver.
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Slide 30: Unified Communications Services
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Slide 31: The Leader in Unified Communications
A market leader in high-growth UCaaS segment At forefront of emerging communications trends Synergistic relationship with conferencing business – leverage relationships of large, tenured sales force Well-positioned to capitalize on customer migration to cloud-based solutions World’s leading conferen
Slide 32: UCaaS Key Highlights
Unified Communications Services UCaaS Key Highlights High-growth UCaaS market with improving margins and multiple expansion opportunities Consistently recognized as a market leader – vision and ability to execute Expanding product portfolio adds to competitive differentiation Expanding geographic fo
Slide 33: West Cloud Contact Center Portfolio
Sophisticated Call Routing & Management Complete Cloud Offering West Cloud Contact Center Portfolio Cloud Contact CE Cloud Contact Pro Cloud Contact Quality monitoring Multi-channel outbound Multi-channel inbound Contact recording Workforce management Cloud Voice Cloud Contact Center UCaaS 24x7 NOC
Slide 34: UCaaS Markets We Serve
Majority of adoption to date concentrated in small and medium-size businesses Larger enterprise are beginning to adopt UCaaS more rapidly as legacy investments are retired Vertical markets of Professional Services (Law, Financial Services, Accounting) with distributed information workers are top pro
Slide 35: Recognized Leader in UCaaS
West Maintains Leaders Quadrant Position 5 Consecutive Years Source: Gartner Recognized Leader in UCaaS UCaaS Gartner 2016 Results
Slide 36: UCaaS growth initiatives
Leverage C&C salesforce Grow new MRR bookings Increase brand awareness Ramp cloud contact center offerings Execute international growth plans Sell the “full” UCaaS suite International acquisitions (talent, platforms, customers) Migrate existing customers to West’s proprietary platforms Add more comp
Slide 37: Conferencing & Collaboration Key Highlights
World’s largest conferencing service provider Most competitive cost structure and best-in-class margins Low ongoing CapEx requirements help drive exceptional cash flow Unrivalled sales & marketing capabilities Large, diversified and long-tenured global customer base Global infrastructure − best-in-c
Slide 38: Multi-Year Track Record of Out-performance
Multi-Year Track Record of Out-performance Consistently outperforming audio market in minutes and revenue growth, due to: Unrivaled global sales force Enterprise-centric client base Mix of proprietary & partner products Highly-profitable conferencing service provider, with an industry-leading cost s
Slide 39: Conferencing and Collaboration current initiatives
Cisco Cloud Collaboration partnership Enterprise streaming Support UCaaS growth initiatives Execute international growth plans (China, India) Build value-added products around core platform functionality Expand streaming portfolio Network quality management tools Seamless, bundled UC offerings (UCaa
Slide 40: Specialized Agent Services
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Slide 41: Healthcare Advocacy Key Highlights
Largest provider of healthcare advocacy on behalf of employers and plan sponsors − independent from payers Comprehensive suite of consumer-focused healthcare services Large addressable market opportunity Positioned to benefit from secular trends in the healthcare industry – consumerization, complexi
Slide 42: Innovative and Complementary Solutions
Innovative and Complementary Solutions Encourage Better Health and Well-Being Improve Health Outcomes Connect All Benefits; Drive Utilization Reduce Costs Reduce Burden of Complex Healthcare Benefits/System on HR and Employees Proprietary Technology Platform and Data Analytics Benefits Gateway Healt
Slide 43: Comprehensive Clinical Model
Comprehensive Clinical Model Clinical Advocacy Talk to a Medical Expert Get Expert Second Opinions Find the Right Doctors Explore Treatment Options Close Gaps in Care Data Medical Rx Dental Biometric Healthcare Advocacy
Slide 44: Driving Engagement in Healthcare Advocacy
Help clients envision, design and deliver differentiated experiences for their consumer, parent, patient and member through: Driving Engagement Health benefits are confusing and fragmented. We make healthcare easier Simplifying and connecting it all together, to drive better results… Lower Administr
Slide 45: Healthcare Advocacy Multiple Growth Opportunities
Health Advocacy/Clinical Health Advocacy Wellbeing solutions EAP Data-driven solutions/analytics Engagement services/platform Healthcare Advocacy Multiple Growth Opportunities
Slide 46: Healthcare
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Slide 47: West has Meaningful Exposure to Healthcare Markets
$325MM in estimated healthcare revenue, growing an estimated 8-10% per year. West serves all key healthcare market participants: Revenue figure is an estimate derived from a mix of West products across all segments, and excludes on-demand conferencing. Providers Pharmacy Employers Manufacturers Inte
Slide 48: Full Spectrum of Integrated Healthcare Solutions
Multi-Channel Communications Access Rx Refill Notifications Appointment Reminders Payment Integrity Wellness Programs and Coaching Employee Assistance Programs (EAP) Clinical and Admin Advocacy Medication Adherence Programs Chronic Care Programs and Coaching Claims Data Analytics Gaps in Care Coachi
Slide 49: Common Need across Healthcare Market Segments
Common Need across all Healthcare Market Segments: Consumer Engagement Move to value-based care models Patient-centered care, with improved patient satisfaction Optimize reimbursement and reduce penalties Providers Reduce health plan costs Greater employee benefit program engagement Improve overall
Slide 50: Finance
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Slide 51: 2017 Guidance
Consolidated Revenue $2,286 - $2,362 Adjusted EBITDA $639 - $672 Adjusted Operating Income $500 - $532 Adjusted EPS – Diluted $2.76 - $3.00 Cash Flows from Operations $380 - $420 Capital Expenditures $100 - $130 2017 guidance assumes repurchasing 1 million shares and no new acquisitions. Reconciliat
Slide 52: Enterprise Improvement Initiatives
Cost Initiatives Higher margin, value-added products and services Additional scale Cost leverage with Telecom Services and other infrastructure investments Acquisition synergies Segment Initiatives Procurement centralization Data center and platform consolidation Automation of manual processes Enter
Slide 53: West Generates Tremendous Free Cash Flow
West Generates Tremendous Free Cash Flow FCF margins 13% in 2016, driven by high operating cash flow and low capex requirements High-quality revenue and high degree of visibility Recurring revenue businesses Long-term contracts and long-standing customer relationships Platform-based businesses with
Slide 54: Q&A
Q&A