Ava Risk Group Ltd. · ASX:AVA
Ava Risk — Investor Presentation (March 2020)
24 slides from Ava Risk's investor presentation, Mar 5, 2020
Slide 1: Investor Presentation – 5 March 2020
Investor Presentation – 5 March 2020 For personal use only 1
Slide 2: Forward Looking Statements
Forward Looking Statements For personal use only This presentation is given on behalf of Ava Risk Group Limited (AVA) Information in this presentation is for general information purposes only, and is not an offer or invitation for subscription, purchase, or recommendation of securities in AVA. Certa
Slide 3: Company Overview
Company Overview For personal use only AVA Group is a diversified risk management technology and services company operating around the globe HY2020 Revenue Contribution 45% 45% Services division AVA Global Logistics 10% Future Fibre Technologies Technology division BQT Solutions 3
Slide 4: Services Division – Ava Global Logistics
Services Division – Ava Global Logistics For personal use only • Ava Global Logistics is a growing global provider of secure international logistics of high-risk valuables, precious metals and currency. • Provides fully insured, door to door services, utilising a network of highly experienced securi
Slide 5: Technology Division – BQT Solutions
Technology Division – BQT Solutions For personal use only • BQT’s secure, reliable smart reader and card systems, biometric solutions, electric locking, and access control products are utilised at over 3,500 sites in more than 50 countries. • A leader in high security access control technology used
Slide 6: Technology Division – Future Fibre Technologies
Technology Division – Future Fibre Technologies • For personal use only FFT is a global leader in fibre optic intrusion detection systems, with a track record of delivering highly intelligent, reliable, and award-winning intrusion detection solutions for the protection of critical sites and infrastr
Slide 7: Major Organizations All Around the World Depend on AVA
Major Organizations All Around the World Depend on AVA For personal use only 7
Slide 8: H1 FY2020 Business Highlights
H1 FY2020 Business Highlights For personal use only Strong Revenue Gross Margin Operating Expenses Strong Order Growth Improvement Reduced Backlog • 23% growth in sales • Services Division • Better working • Technology Division revenue vs pcp maintained its GM at capital management Backlog of A$16.7
Slide 9: Substantial Revenue Growth
Substantial Revenue Growth Ava Group has recorded substantial revenue growth in recent years with six-month revenues growing For personal use only from ~$6m in H1 2017 to >$20m in H1 2020 – average pcp growth of 35% and a CAGR of >50% Growth vs PCP -31% 21% 44% 62% 95% 32% 23% A$m $22.0 120% $20.0 1
Slide 10: Reducing Operating Costs
Reducing Operating Costs Ava Group has recorded substantial improvement in Opex as a % of revenue in recent years with Opex For personal use only declining from ~155% in H1 2016 to >40% in H1 2020 as the business scales and grows. Opex as a % of Sales Revenues 180% 160% 140% 120% 100% 80% 60% 40% 20
Slide 11: EBITDA Positive with Impressive Margin Contraction
EBITDA Positive with Impressive Margin Contraction As its revenues have grown Ava Group has significantly improved its EBITDA margin For personal use only through a more efficient cost base, working capital management and diligent opex management, resulting in positive EBITDA in H1 2020 $3.0 20% EBI
Slide 12: H1 FY2020 Financial Summary
H1 FY2020 Financial Summary For personal use only H1 H1 YoY % AUD$M# FY2020 FY2019 Change Sales Revenue 20.4 16.7 +23% • Increasing Revenues COGS 10.4 9.8 +7% Gross Profit 10.0 6.9 +45% • Increasing Margins (IMOD contribution) GP Margin (%) 49% 41% +8% Operating Expenses 7.8 8.6 -10% • Reducing Cost
Slide 13: H1 FY2020 Financial Summary - Balance Sheet
H1 FY2020 Financial Summary - Balance Sheet AUD$M 31 Dec 2019 30 Jun 2019 For personal use only Cash and cash equivalents 3.1 3.1 Receivables 7.5 5.0 Inventories 4.3 4.5 Intangibles 13.3 12.7 • No external debt or borrowings. Other assets 1.1 1.2 • Cash Balance of A$3.1m Total assets 29.3 26.5 Payab
Slide 14: H1 FY2020 Highlights
H1 FY2020 Highlights For personal use only Ava Group (Technology Division + Services Division): • H1 FY2020 revenues increased by 23% to A$20.4m compared to same time last year. • Gross margins improved by 8% to 49% compared to 41% for the same time last year. • EBITDA* of A$2.2m an increase of appr
Slide 15: H1 FY2020 Highlights
H1 FY2020 Highlights For personal use only Technology Division (FFT + BQT): • Record revenues of A$11.3m • EBITDA was A$1.8m • Gross margins improving from 70% in H1 FY2019 to 72% in H1 FY2020, driven by equal contributions from IMOD licensing revenues and underlying business sales gross margin impr
Slide 16: Services Division Update
Services Division Update • Ava Global has recently been awarded preferred supplier status For personal use only with Moneycorp Bank Ltd, to provide secure logistics and cash processing services, to and from New York, USA. Moneycorp expects that volumes will increase significantly over the coming mon
Slide 17: Technology Division – BQT – New EU Master Distributor Agreement
Technology Division – BQT – New EU Master Distributor Agreement For personal use only • AVA’s BQT Solutions subsidiary has finalized negotiations for an expansion of it’s existing locking supply arrangements into Europe, with the signing of a new Master Distributor Agreement with a major global lock
Slide 18: Technology Division – BQT – YG80 Locking Update
Technology Division – BQT – YG80 Locking Update For personal use only • Sales of our award winning YG80 lock continue to increase, particularly in the US market through the distribution agreement with DormaKaba. • A major opportunity for Ava’s BQT Solutions to potentially supply ~100,000 units of ou
Slide 19: Technology Division – FFT – India MoD Tranche Update
Technology Division – FFT – India MoD Tranche 1 Update For personal use only The total contract value to Ava for this project is estimated at US$11.9m (A$18.0m). More than 400 of the first 600 units (~25% of project) have now been built by Ava’s in-country partner SFO: • The first 200 units passed F
Slide 20: Aura AI-2 Platform Sales Growth
Aura AI-2 Platform Sales Growth Ava Group has achieved significant interest and acceptance of its leading Aura Ai-2 platform from For personal use only launch in 2017 to >25 in H1 2020 YoY Growth 450% 210% 40 35 30 25 20 15 10 5 0 FY 2017 FY 2018 FY 2019 H1 2019 20
Slide 21: Technology Division – FFT – AURA IQ Update
Technology Division – FFT – AURA IQ Update For personal use only The Technology Division launched its new Aura IQ conveyor belt health and assurance monitoring solution in Q1 FY2020. First customer orders have been received, and installations completed. Significant interest in Aura IQ continues to g
Slide 22: FY2020 Ava Group Outlook
FY2020 Ava Group Outlook Continued Strong Revenue Growth Forecast Following Record H1 FY2020 Performance. For personal use only Clear Earnings & Opportunity Pipeline Visibility for H2 FY2020 and FY2021. Core Business Operationally Stable & Consistently Delivering on Commitments. • Services Division
Slide 23: Comparative Company Assessment – Services Division
Comparative Company Assessment – Services Division For personal use only Market Net Debt Revenue EBITDA Name Currency Price Shares (B) EV ($B) EV/Rev EV/EBITDA Op Margin D/E ROE ROA Cap ($B) ($B) ($B) ($B) AVA Risk Group AUD $0.12 0.23 $0.03 $0.00 $0.03 $0.04 $0.01 0.6X 4.3x (Canaccord forecast for
Slide 24: Comparative Company Assessment – Technology Division
Comparative Company Assessment – Technology Division For personal use only Market Net Debt Revenue EBITDA Name Currency Price Shares (B) EV ($B) EV/Rev EV/EBITDA Op Margin D/E ROE ROA Cap ($B) ($B) ($B) ($B) AVA Risk Group AUD $0.12 0.23 $0.03 $0.00 $0.03 $0.042 $0.0063 0.6X 4.3x (Canaccord forecast