Slide 1: Queensland Companies Symposium
Private and Confidential www. TechnologyOneCorp.com Queensland Companies Symposium Technology One Intelligent eBusiness Solutions Nov 7th, 2002 Adrian_DiMarco@TechnologyOneCorp.com Chief Executive Officer
Slide 2: Our Strategy
@ Our Strategy m The Technology One Difference w@ 2002 Financial Highlights m@ Significant Achievements t Outlook 2003 w Initiatives for 2003 Technology Intelligent One eBusiness
Slide 3: Our Strategy
Our Strategy “Technology One’s focus is the design, development, implementation & support of integrated & powerful enterprise wide industry solutions using internet, eBusiness and client/server technologies.” Technology Intelligent One eBusiness
Slide 4: Our Strategy
Our Strategy Consulting & Services ducts Development P Custom Software Third Pa Finance One Application Development Framework Common Methodologies & Systems Technology . Intelligent One Highly Integrated Strategy eBusiness
Slide 5: Our Strategy
@ Our Strategy m The Technology One Difference w@ 2002 Financial Highlights m@ Significant Achievements t Outlook 2003 w Initiatives for 2003 Technology Intelligent One eBusiness
Slide 6: The Technology One Difference
The Technology One Difference m Extensive Intellectual Property (IP) m@ Unique Business Model @ Mid Market Focus m Vertical Market Focus — next step on from ERP m Enterprise Applications ™ Large Recurring Revenue Base m Diversity of Revenue Stream a Intelligent Engineering Technology Intelligent One
Slide 7: Extensive Intellectual Property (IP)
Extensive Intellectual Property (IP) m We have today one of the most significant software IP portfolios ever developed in Australia, covering a broad range of industries Technology Intelligent One eBusiness
Slide 8: Our Portfolio of Products
Our Portfolio of Products m Finance One - Financial management and accounting mw Retail One - Retail m Sales One - Wholesale and distribution m People One - Human Resources and Payroll w Proclaim One - Local Government m@ Student One ~ Student Administration for Universities Technology Intelligent O
Slide 9: Extensive Intellectual Property (IP)
Extensive Intellectual Property (IP) m We own the IP, and only we are able fo sell it a Differentiates us from 80% of the IT industry which is primarily service based and can only really differentiate based on price m World Class R&D Center in Brisbane a ISO 9000 accredited a Culture, Systems and Pr
Slide 10: The Technology One Difference
The Technology One Difference m Extensive Intellectual Property (IP) # Unique Business Model i Mid Market Focus m Vertical Market Focus — next step on from ERP m Enterprise Applications m Large Recurring Revenue Base m Diversity of Revenue Stream m Intelligent Engineering Technology Intelligent One
Slide 11: Unique Business Model
Unique Business Model m@ We are the only Enterprise vendor that both develops, and then markets, sells, implements and supports their own suite of applications Offices throughout Australia, New Zealand and Asia, and we will continue to expand geographically Technology Intelligent One eBusiness
Slide 12: Unique Business Model
Unique Business Model Technology One @ Benefits a Not reliant on distributors/ third parties They own the customer relationship They are primarily responsible for the success of the customer Short term focus, on immediate revenues/profits They are not reliable or committed long term In their interes
Slide 13: The Technology One Difference
The Technology One Difference m Extensive Intellectual Property (IP) m Unique Business Model m Mid Market Focus m Vertical Market Focus — next step on from ERP m Enterprise Applications m Large Recurring Revenue Base m Diversity of Revenue Stream m Intelligent Engineering Technology Intelligent One
Slide 14: Mid Market Focus
Mid Market Focus w Software and Services market « Historically fastest growing market in IT industry @ Mid Sized organisations « Organisations of $100 to $300 million turnover ~ We do service $30 to $1,000 million turnover « Fastest growing sector in the Software and Services market # No one dominat
Slide 15: Mid-market competitors
Oracle Qsp Computron / G sooner $300m Navision Sunsystems / Great Plains Epicor ea Australia is one of the world’s most competitive countries mei One . . eBusiness - competitors from USA, UK, Europe, South Africa
Slide 16: Mid Market Focus
Mid Market Focus mw Key Issues a Better than Low End Players (MYOB, Accpac, Great Plains ..) ~ Rich functionality to manage complex businesses a Better than High End Players (SAP, Peoplesoft, Oracie..) ~ Ease of use ~ Simple and intuitive to use - Quick implementations ( 3 to 6 months) ~ Whole of Li
Slide 17: The Technology One Difference
The Technology One Difference m Extensive Intellectual Property (IP) m@ Unique Business Model m Mid Market Focus @ Vertical Market Focus — next step on from ERP m Enterprise Applications m Large Recurring Revenue Base m Diversity of Revenue Stream m Intelligent Engineering Technology Intelligent One
Slide 18: Vertical Market Focus
Vertical Market Focus — Next Step on From ERP m Use Finance One as the platform to create powerful new solutions for specific vertical markets a One of the few companies globally that owns a proven world class financial management and accounting engine m@ Total solutions for each vertical market, fr
Slide 19: Vertical Market Focus
Vertical Market Focus — Next Step on From ERP @ Current vertical markets a Local Government (Proclaim One) a University/ Student Administration (Student One) « Retail (Retail One) a Wholesale/ Sales Distribution (Sales One) a Custom Application Development m Investigating new vertical markets « Prof
Slide 20: The Technology One Difference
The Technology One Difference m Extensive Intellectual Property (IP) m@ Unique Business Model m@ Mid Market Focus m Vertical Market Focus — next step on from ERP # Enterprise Applications m Large Recurring Revenue Base m Diversity of Revenue Stream m Intelligent Engineering Technology Intelligent On
Slide 21: Enterprise Applications
Enterprise Applications m# Our software runs enterprises a Mission critical a High barrier to entry # Special relationship with our customers « Reluctant to change — ‘lock in’ annuity stream a Prepared to continue to invest ongoing « Opportunities to sell more products and services — ‘upside’ Intell
Slide 22: The Technology One Difference
The Technology One Difference m Extensive Intellectual Property (IP) m@ Unique Business Model @ Mid Market Focus m Vertical Market Focus — next step on from ERP m Enterprise Applications m Large Recurring Revenue Base m Diversity of Revenue Stream m Intelligent Engineering Technology Intelligent One
Slide 23: Large Recurring Revenue Base
Large Recurring Revenue Base @ Powerful revenue model m Initial Licence Fee & Initial Services m Annual Licence Fee & Annual Services Additional Licence Fees from Upgrades & new Modules/Systems @ Additional Licence Fees from Third Party products Technology Intelligent One eBusiness
Slide 24: Large Recurring Revenue Base
Large Recurring Revenue Base TECHNOLOGY ONE REVENUE MODEL Initial Every Every Purchase Year Year Implementation Ongoing Product Upgrade Services Services Extensions Licence Up front Fee for Annual Feefor Extra Extra = Annual licence fee service licence service fee fee licence + fee + + fee Annual An
Slide 25: Comparison
Comparison @ TechOne @ Competitor Existing N . New A I N ew Licence ew Annua ew. Customer Fees Licence Fees Services Revenue Technology Intelligent One eBusiness
Slide 26: The Technology One Difference
The Technology One Difference m Extensive Intellectual Property (IP) m@ Unique Business Model @ Mid Market Focus m Vertical Market Focus — next step on from ERP m Enterprise Applications ™m Large Recurring Revenue Base m Diversity of Revenue Stream m Intelligent Engineering Technology Intelligent On
Slide 27: Diversity of Revenue Stream
Diversity of Revenue Stream @ Generally a Government and Corporates @ Vertical markets a Local Government a State Government a Federal Government a Education — Universities, Tafes etc.. a General Corporate a Retail a Wholesalers m Geographies a Australia, New Zealand, Asia Technology Intelligent One
Slide 28: Sample Customer Base
Sample Customer Base Technology One m Strong, diverse, loyal blue chip client base Federal Government - ACCC - Dept of Prime Minister - Federal Court - Legal Aid - Australian Institute of Health and Welfare - DAS Fleet - Dept of Industry,Science & Resources State Government - Melbourne Port - NSW Fo
Slide 29: The Technology One Difference
The Technology One Difference m Extensive Intellectual Property (IP) m@ Unique Business Model @ Mid Market Focus m Vertical Market Focus — next step on from ERP m Enterprise Applications ™m Large Recurring Revenue Base m Diversity of Revenue Stream w Intelligent Engineering Technology Intelligent On
Slide 30: Intelligent Engineering
Intelligent Engineering Consulting & Services rty Third Pa Products Bas zs 85 ce) EG £3 n 3a _o Application Development Framework Common Methodologies & Systems Technology Intelligent One eBusiness
Slide 31: Intelligent Engineering
Intelligent Engineering # Amortise R&D over a wide range of applications m@ Use industry standard technology a SAP, Peoplesoft, Navision, Great Plains etc.. have a proprietary approach m One source code baseline a Ail customers run exactly the same code Technology Intelligent One eBusiness
Slide 32: Our Strategy
@ Our Strategy m The Technology One Difference @ 2002 Financial Highlights m@ Significant Achievements t Outlook 2003 w Initiatives for 2003 Technology Intelligent One eBusiness
Slide 33: 2002 Financial Summary
2002 Financial Summary m 7'™ consecutive year of record revenues m 10‘ consecutive year of record profits w Difficult trading conditions continue in the IT sector Technology Intelligent One eBusiness
Slide 34: 2002 Financial Highlight
2002 Financial Highlight # EBITDA* of $13.4 million, up 20 percent m@ Revenue of $ 46.37 million, up 20 percent # R&D Expenditure (fully expensed) of $8.14 million, representing 17% of Revenue # Net Profit After Tax of $8.76 million, up 13 percent w Earnings Per Share of 2.76 cents, up 11 percent m
Slide 35: 2002 Financial Highlight
2002 Financial Highlight w Significant R&D program continued at 17% of Revenues a Almost equal to the size of our NPAT a All R&D continued to be fully expensed Technology Intelligent One eBusiness
Slide 36: Our Strategy
@ Our Strategy m The Technology One Difference w@ 2002 Financial Highlights @ Significant Achievements t Outlook 2003 w Initiatives for 2003 Technology Intelligent One eBusiness
Slide 37: Significant Achievements
Significant Achievements m New Clients Licence Fees up 22% « Exceptional result in a very difficult and competitive market « Addition of 42 new clients m Finance One Suite continues to perform well (revenue up 40%) a Largest Finance One contract signed with WA Tafe a Retail One Emergence: The Good G
Slide 38: Significant Achievements
Significant Achievements m@ Proclaim One Revenue up 7% a Six new clients a Leading supplier in local government in Australia a First New Zealand council (Wanganui District Council) m@ Student One - limited opportunities in Australia a Focused on securing new licence fees 2003 Technology Intelligent
Slide 39: Significant Achievements
Significant Achievements @ Continued Investment in: a Australia a New Zealand a Malaysia m Account Management a Initiative implemented last year a Improved customer satisfaction based on User Survey a Additional revenues generated from User base « Model still being refined for effectiveness and focu
Slide 40: Significant Achievements
Significant Achievements m Opening of new Canberra office (now have direct representation in all States) i Increased sales / presales infrastructure Technology Intelligent One eBusiness
Slide 41: New Clients
New Clients mw Retail a The Good Guys a Godfrey's a Rabbit Photo @ International a Northern Utility Resources (Malaysia) a Universal Trustee Bhd (Malaysia) « Metro Water Limited (New Zealand) a Wakefield Hospital (New Zealand) a Wanganui District Council (New Zealand) a Wanganui Gas Limited (New Zea
Slide 42: New Clients
New Clients Technology One m@ Local Government a City of Charles Sturt a City of Cockburn a City of Greater Bendigo a Great Lakes Council a Local Government Association of Qld a Mackay City Council a Moyne Shire Council a Sutherland Shire Council a Wagga Wagga City Council @ Corporate Baptist Commun
Slide 43: New Clients
New Clients m@ State / Federal Government « Australian Radiation Protection & Nuclear Safety Authority (ARPANSA) a Building Services Authority a Indigenous Land Corporation = Lower Murray Region Water Authority = Queensland Performing Arts Trust a Royal District Nursing Service SA a» Tasmanian Depar
Slide 44: Project Services
Project Services New Business m@ Project Services performing strongly (revenue up 10%) m Project Services, major contracts awarded include: = PBL (Strategic relationship with PBL} «» Access Queensland a NSW Police (Informants), Missing Persons System and Child Protection Register « Stage 2 — Victori
Slide 45: Significant Achievements
Significant Achievements m@ Continued R&D into: a Finance One (R10.1 shipped) a Retail One and Sales One (R10.1 shipped) a People One (R10.1 shipped) as Proclaim One (R9.0 to ship Q3 2002 ) a Student One (R2.2 and R2.3 shipped) a ADF (R5.3 shipped) m Continued R&D into new technologies: a Microsoft
Slide 46: Our Strategy
@ Our Strategy m The Technology One Difference w@ 2002 Financial Highlights m@ Significant Achievements tm Outlook 2003 w Initiatives for 2003 Technology Intelligent One eBusiness
Slide 47: Significant Challenge: IT Environment
m Significant Challenge: IT Environment Technology Intelligent One eBusiness
Slide 48: Year Business Replacement Cycle for Enterprise Applications
10 Year Business Replacement Cycle for Enterprise Applications Level of Business - 10 Year Cycle —Y2k — Normal 1994 1995 1996 1997 1998 1999 2000 2002 2003 2004 2005 2006 2007 2001 s 40+% business done in two years to Y2K Technology » Expect some improvement in 2003/2004 year |RVaTTaaer One « Expect
Slide 49: Very low level of business
m Very low level of business # Continuing fierce competition m Reluctance by customers to sign contracts @ Onerous contractual conditions & payment terms Technology Intelligent One eBusiness
Slide 50: Significant challenge to provide continuing growth
m Significant challenge to provide continuing growth this year, on the back of 10 years of consecutive record revenue @ Streamlining the company « New organisational structure a Impact will not be felt this financial year m Significant operating leverage TNE has, once environment improves Technology
Slide 51: Our Strategy
@ Our Strategy m The Technology One Difference w@ 2002 Financial Highlights m@ Significant Achievements t Outlook 2003 w Initiatives for 2003 Technology Intelligent One eBusiness
Slide 52: Initiatives for 2003
Initiatives for 2003 m Organisational Restructure # .NET Initiative with Microsoft m@ Partnerships & Acquisitions @ Consolidate our presence in all regions & verticals Technology Intelligent One eBusiness
Slide 53: Current Structure
Current Structure m Macro structure is unchanged a Software Engineering — software centric a Service Delivery — customer centric Technology Intelligent eBusiness One
Slide 54: Organisational Restructure
Organisational Restructure Service Delivery mw “Act Locally — Think Globally” « Move from Departmental to Regional reporting lines a Remove head-office General Managers « Appoint Regional Managers (at the ‘coal face’) with P&L responsibility and decision making « Create a direct link between Regions
Slide 55: Organisational Restructure
Organisational Restructure Service Delivery Current Structure ——» New Structure @ Departmental focus m@ Regional Focus s Departmental P&Ls a Regional P&Ls # Direct link to regions Technology Intelligent One eBusiness
Slide 56: Organisational Restructure
Organisational Restructure Software Engineering m “Research and Development” Technology One Differentiate between hard core Research and Product Development Product Development ~ Existing products only — evolutionary approach ~ Specialised methodology and structure and skills sets ~ Focused ongoing
Slide 57: Organisational Restructure
Organisational Restructure Software Engineering Current Structure ————> New Structure Technology Intelligent One eBusiness
Slide 58: Organisational Restructure
Organisational Restructure Software Engineering # Benefits Summary « Act Locally — Think Globally a Faster and decentralised decision making a Better supports our geographical expansion a Greater focus on customer satisfaction a» Improved R&D ~ Smaller teams ~ Separation of hard core Research from D
Slide 59: .NET Initiative
.NET Initiative w Working closely with Microsoft m New generation of smart internet applications m Revolutionize Enterprise Application space @ All TNE’s products will be migrated to this new architecture @ Large growth opportunity in 2004/2005 Technology Intelligent One eBusiness
Slide 60: Partnerships & Acquisitions
Partnerships & Acquisitions m@ To extend our product reach # Partnership with a Chameleon for Advanced Budgeting » EMS Solution for Asset Intensive Industries « First step to getting a deep understanding of new industries/sectors Technology Intelligent One eBusiness
Slide 61: Consolidate Presence in all regions & verticals
Consolidate Presence in all regions & verticals m@ National network of offices now established a New ACT office established early 2002 @ Continue to invest in: a New Zealand a Malaysia @ Increase our penetration in: a Local government in Australia & New Zealand a Retail a Payroll/HR a Student Admini
Slide 62: After Word
After Word These slides are available from the company’s web site, under the Investor Relations section : www. TechnologyOneCorp.com Technology Intelligent One eBusiness
Slide 63: Queensland Companies Symposium
Private and Confidential www. TechnologyOneCorp.com Queensland Companies Symposium Technology One Intelligent eBusiness Solutions Nov 7th, 2002 Adrian_DiMarco@TechnologyOneCorp.com Chief Executive Officer