Tantalus Systems Holding Inc · TSX:GRID
Tantalus Systems — Investor Presentation (July 2024)
35 slides from Tantalus Systems's investor presentation, July 2024
Slide 1: Modernize the Grid by Harnessing the Power of Data
TANTALUS.COM July 2024 MODERNIZE THE GRID BY HARNESSING THE POWER OF DATA INVESTOR PRESENTATION TSX : GRID
Slide 2: Legal Notice and Disclaimer
Legal Notice and Disclaimer IMPORTANT: YOU MUST READ THE FOLLOWING BEFORE CONTINUING. The information contained in this presentation has been prepared by Tantalus Systems Holding Inc. (the “Company”) for information purposes only. References to “Tantalus” or the Company for periods prior to January
Slide 3: Well-Positioned to Modernize the Distribution Grid
Well-Positioned to Modernize the Distribution Grid Helping Utilities Harness the Power of Data 300+ 125+ 20+ 3.5M PURPOSE Dedicated Channel Utilities within a Connected employees partners to growing user devices across Canada support sales community deployed & US growth SCALABILITY US$42M+ 35% US$11
Slide 4: Drivers Creating Urgency For Utilities
Drivers Creating Urgency For Utilities Any one of these mega-trends poses immediate and massive problems that have to be dealt with now Extreme Weather Electrification of Everything • 133% Increase in weather + • Demand for electricity in US climate disasters from 2010-20 could double by 2050 • 28 d
Slide 5: Emerging Problems
Emerging Problems Utilities facing issues resulting from the mega-trends Addressing Supply/ Reducing Risk of Managing Demand Imbalance Power Outages Grid Data Increased EV adoption, the greater electrification of society Power outages cost the Utilities struggling to harness and the decarbonization
Slide 6: Additional Growth of Electric Demand
Additional Growth of Electric Demand Distribution grid under further stress as utilities are expected to deliver more power Power Consumption Nationwide power consumption is projected to rise by at least 38 gigawatts between now and 2028. Electrification EV adoption and home and industrial electrifi
Slide 7: The Grid Modernization Mandate is Massive
The Grid Modernization Mandate is Massive 60% $2T $500B of the North will be spent by already allocated American electrical utilities between through stimulus grid is past its life now and 2030 to programs that cover expectancy address the Tantalus solutions challenge TSX: GRID Confidential and Prop
Slide 8: A Technology Platform that Delivers Grid Modernization
A Technology Platform that Delivers Grid Modernization The Tantalus Grid Modernization Platform Analytics TRUGrid Automation family of analytics solutions (including TRUGrid Transformer and TRUGrid Reliability) Applications Applications that target specific outcomes, including restoration, voltage r
Slide 9: A Unified Set of Solutions to Accelerate Modernization
A Unified Set of Solutions to Accelerate Modernization Substation-to-Meter Grid Edge Behind-the-Meter (Traditional Areas of Focus for Utilities) (Extending the "Grid Edge") Substation Distribution Meter Smart Home In-Home Distributed Feeder Appliances Energy Resources & EV Chargers TRUGrid TRUConnec
Slide 10: Customer's Journey to Grid Modernization
Customer’s Journey to Grid Modernization One platform. Multiple entry points. Substation to Meter: Grid Edge: Accessing data Behind the Meter: Reducing risk of outages Managing the supply/demand balance hidden behind the meter by leveraging every device on the grid In-Home Distributed Distribution S
Slide 11: Future Vision: TRUSync Grid Data Management
Future Vision: TRUSync Grid Data Management Tantalus has an early lead in this massive long-term market opportunity You can’t fully modernize the grid without truly interoperable data. The demand for grid data management is in its early stages. Some utilities—primarily IOUs—have already started on t
Slide 12: Tantalus Grid Modernization Provides the Solutions
Tantalus Grid Modernization Provides the Solutions The Tantalus Grid Modernization Platform addresses multiple issues facing utilities Addressing Supply/ Reducing Risk of Managing Demand Imbalance Power Outages Grid Data TRUFlex Load & DER TRUGrid TRUSync Grid Data Management System Automation Suite
Slide 13: Summary of the TRUSense Gateway
Summary of the TRUSense Gateway 13
Slide 14: Building Momentum Through the TRUSense Gateway
Building Momentum Through the TRUSense Gateway At the intersection of the electrification of everything & grid modernization First-Mover Advantage Major Milestones/Timelines • Combines four high-value use cases • Fiber – UL Certification received • Market-leading sensing capabilities • Ethernet – ET
Slide 15: TRUSense Gateway: Extending the Edge of the Grid
TRUSense Gateway: Extending the Edge of the Grid Summary TRUSense Gateway is referred to as a meter socket device Retrofits into any existing residential electric meter socket (ANSI-based) Supports any existing ANSI meter Versatile to help utilities accelerate grid modernization with existing infras
Slide 16: Extending the Edge of the Grid
Extending the Edge of the Grid Protecting transformers and delivering unparalleled demand-side flexibility Rooftop Solar EV Charging Storage Smart Appliances & Devices TSX: GRID Confidential and Proprietary | Page 16
Slide 17: TRUSense Gateway Provides a Compelling Growth Catalyst
TRUSense Gateway Provides a Compelling Growth Catalyst $150M $350M potential revenue approximate revenue opportunity from our opportunity in our Advisory Committee qualified pipeline $10B 10-15% total addressable growth rate of existing market Tantalus business TSX: GRID Confidential and Proprietary
Slide 18: Financial Summary
FINANCIAL SUMMARY Through March 31, 2024
Slide 19: How Tantalus Generates Revenue
How Tantalus Generates Revenue Deploying connected devices leads to recurring revenue over 12 – 15 years Recurring Software Maintenance & SaaS Subscriptions (Data Analytics) Software & Perpetual Software Analytics License Annual Technical Support Agreements Professional Deployment / Project Manageme
Slide 20: Increasing Annual Recurring Revenue Growth
Increasing Annual Recurring Revenue Growth Continuing to increase the revenue contribution from Recurring Revenue each year Highlights Recurring Revenue (US$M) Recurring Revenue (US$M) Recurring Revenue comprised of SaaS subscriptions, $12.0 30% term-based software licenses, software maintenance, CA
Slide 21: Q1 '24 Income Statement Summary
Q1 ’24 Income Statement Summary Higher contribution for Software & Services led to improved results Highlights Comparative Financial Highlights (US$M) Revenue declined by 10% over prior year due to timing of order conversions and capacity allocations with metering partners Software & Services revenu
Slide 22: Q1 '24 Revenue Contribution & Gross Profit Margin Summary
Q1 ’24 Revenue Contribution & Gross Profit Margin Summary Driving Software & Services revenue as more Connected Devices are deployed Note: Reflects percentage contribution of total revenue. Note: Reflects Gross Profit Margin percentage. TSX: GRID Confidential and Proprietary | Page 22
Slide 23: Q1 '24 TTM Income Statement Summary
Q1 ‘24 TTM Income Statement Summary Improved Adjusted EBITDA while investing in TRUSense Gateway Highlights Comparative Highlights (US$M) Revenue increased over respective TTM periods Increased Gross Profit Margin during the TTM period to 54% Operating expenses include approx. $5.5M of investment in
Slide 24: TTM Revenue Contribution & Gross Profit Margin Summary
Q4 ‘24 TTM Revenue Contribution & Gross Profit Margin Summary Software & Services contributing to higher Gross Profit Margin percentage Note: Reflects percentage contribution of total revenue. Note: Reflects Gross Profit Margin percentage. TSX: GRID Confidential and Proprietary | Page 24
Slide 25: Q1 '24 Balance Sheet Summary
Q1 ‘24 Balance Sheet Summary Managing Working Capital to support growth initiatives in 2024 Highlights Comparative Highlights (US$M) Managing Adjusted Working Capital to support ongoing operations and the anticipated launch of the TRUSense Gateway Secured C$10M bought deal equity financing in Q2 (no
Slide 26: Capitalization Overview
Capitalization Overview $2.50 $2.00 $1.50 $1.00 $0.50 $0.00 2023-07-12 2023-08-12 2023-09-12 2023-10-12 2023-11-12 2023-12-12 2024-01-12 2024-02-12 2024-03-12 2024-04-12 2024-05-12 2024-06-12 2024-07-12 TSX-Listed, Symbol: GRID Debt (as of 03/31/24) US$11.5M Shareholders Institutional Share Price (a
Slide 27: Management
Experienced Leadership Team Management Peter Londa George Reznik Michael Julian Doug Campbell Michael Grandis Tom Allen CEO & Board Member CFO CRO CSO Chief Legal & EVP, Product Administrative Officer Development Board Laura Formusa Dr. Francis Harvey Tom Liston John McEwen Greg Williams Chair Board
Slide 28: Why Invest in Tantalus?
Why Invest in Tantalus? Market Catalysts Substantive Business Growth Catalyst Electrification of Differentiated Solutions TRUSense Gateway Everything & Grid With Growing User Provides a Compelling Modernization Community Growth Opportunity TSX: GRID Confidential and Proprietary | Page 28
Slide 29: Questions?
QUESTIONS? tantalus.com deborah@adcap.ca TSX: GRID
Slide 30: Appendix
©) Tantalus APPENDIX
Slide 31: Building Momentum for GRID
Building Momentum for GRID Annual Financial Performance (US$M) $45.0 $42.1 Revenue $39.6 $40.0 Gross Profit $35.0 $33.0 $32.2 Adjusted EBITDA $30.0 $25.0 Note: Gross Profit Margin $21.9 percentage is reflected as a % $20.0 $18.9 of total revenue. $16.1 $14.4 $15.0 $10.0 $5.0 $2.6 $- $0.0 2020 2021 2
Slide 32: Balance Sheet & Working Capital Management
Balance Sheet & Working Capital Management Annual Cash Inventory Comerica EDC Term Recurring Management Management Debt Facility Loan Revenue • Majority of ARR • Majority of accounts • Suppliers and vendors • Revolver in place since • Secured six-year term collected in Q1 to receivable insured by fu
Slide 33: Elements of the Grid Modernization Initiative (GMI)
Elements of the Grid Modernization Initiative (GMI) The MODERN GRID must have: Enhanced SECURITY Greater RESILIENCY to Improved RELIABILITY from an increasing and hazards of all types for everyday operations evolving number of threats Additional Superior FLEXIBILITY to Increased AFFORDABILITY to res
Slide 34: TRUSense Gateway Use Case: United Illuminating (UI)
TRUSense Gateway Use Case: United Illuminating (UI) Key Themes IES Program for IES Driver for UI Use Cases Opportunity Program • Established by PURA as • Primary themes: • Relying on a legacy AMI • Primary use case ties to • Estimating demand-side part of the Equitable Automation, flexible winter sy
Slide 35: Stimulus Funding Delivers a Unique Growth Opportunity
Stimulus Funding Delivers a Unique Growth Opportunity GRID’s solutions are eligible for stimulus funding amounting to over $400 billion GRID Program Energy Improvements in Reconnect Program BEAD Program Remote Areas $3.9B for 2022 and 2023, in what will $3.9B for 2022 and 2023, in what will Broadban
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