Agilysys, Inc. · NASDAQ:AGYS
Agilysys — Investor Presentation (February 2019)
32 slides from Agilysys's investor presentation, Feb 21, 2019
Slide 1: Investor Presentation February 2019
Investor Presentation February 2019
Slide 2: Forward-looking Statements & Non-GAAP Financial Information
Forward-looking Statements & Non-GAAP Financial Information TECHNOLOGY | INNOVATION | SOLUTIONS Forward-Looking Language This presentation contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward- loo
Slide 3: Agilysys Overview
Agilysys Overview TECHNOLOGY | INNOVATION | SOLUTIONS • Agilysys is a Technology Software Solutions Company Subscription Reservations and Exclusively Focused on the Hospitality Industry On Prem Analytics Guest • Our Solutions Are Mission Critical to Core Hospitality Operations Optimization Value - T
Slide 4: We Serve Leading Hospitality Brands
We Serve Leading Hospitality Brands TECHNOLOGY | INNOVATION | SOLUTIONS Gaming – 56% of Revenue Hotels, Resorts and Cruise – 26% of Revenue FoodFood Service – 17% of Revenue Restaurants, Universities, Stadia and Healthcare – 1% of Revenue Note: Revenue contribution figures represent percentage for t
Slide 5: Agilysys Products
Agilysys Products TECHNOLOGY | INNOVATION | SOLUTIONS Well-Established rGuest Emerging POINT OF SALE (POS) PROPERTY MANAGEMENT (PMS) OTHER 5
Slide 6: Go To Market Strategy
Go To Market Strategy TECHNOLOGY | INNOVATION | SOLUTIONS OBSESSIVELY CUSTOMER CENTRIC IN EVERY MARKET WE SERVE ENGINEERING DRIVEN COMPANY ~10%* R&D Team FY19 YTD ~79%* Increase Strength** Improvement in in YTD Jan 2017 – 230 Customer International Jan 2019 – 475 Retention Bookings Dec 2019 – 750 vs
Slide 7: Agilysys Mission
Agilysys Mission TECHNOLOGY | INNOVATION | SOLUTIONS HELP OUR CUSTOMERS IMPROVE GUEST EXPERIENCE AND LOYALTY WHATEVER IT TAKES, INCLUDING INTEGRATION WITH 3rd PARTY PARTNERS WITH DEDICATION TO PAST, PRESENT & FUTURE CUSTOMER INVESTMENTS IN OUR PRODUCTS AND SERVICES 7
Slide 8: What Sets Agilysys Apart
What Sets Agilysys Apart TECHNOLOGY | INNOVATION | SOLUTIONS Pure Hospitality Hospitality is all We Do Because our Business is 100% Focused on this Industry Comprehensive Solutions Agilysys has the Broadest Software Offerings with the Deepest Functionality in the Market Obsessively Customer Centric
Slide 9: Hospitality Market
Hospitality Market TECHNOLOGY | INNOVATION | SOLUTIONS ARR Market Opportunity ARR Product Opportunity $4.8 Billion $4.8 Billion SA $0.35B 7% APAC $1.36B PMS 28% $1.61B NA 34% $1.72B POS 37% $3.18B 66% EMEA $1.36B 28% Agilysys Revenue ~ $136.3M* *Trailing twelve months ended December 31, 2018. 9
Slide 10: Achievements Under New Management Team
Achievements Under New Management Team TECHNOLOGY | INNOVATION | SOLUTIONS January 2017 (Q4 - • Five Consecutive Quarters of Sequential Revenue Growth FY17) we began a focus on cost control • Three Consecutive Quarters of Record Revenue and aligning resources to position • Expect Approximately 10% Y
Slide 11: Creating Value with New Leadership and Strategy
Creating Value with New Leadership and Strategy TECHNOLOGY | INNOVATION | SOLUTIONS 21 20 Announced 19 First Ever Positive AOE 18 Quarter 17 Tony Pritchett 16 Ramesh Promoted Heather Foster Srinivasan to CFO Joins as VP of 15 Joins as Sridhar Marketing CEO Laveti Joins as 14 Rod Talbot R&D VP Joins
Slide 12: Growth in Engineering Capacity
Growth in Engineering Capacity TECHNOLOGY | INNOVATION | SOLUTIONS 1-Jan-17 31-Jan-19 Growth R&D 229 472 106% Developers 134 318 137% Total Headcount 725 895 23% R&D/HC 32% 53% Developers/HC 18% 36% Contractors* 102 18 *Contractor headcount represents all contractors, not just R&D contractors. 12
Slide 13: India Development Center
India Development Center TECHNOLOGY | INNOVATION | SOLUTIONS • Currently Doubling Capacity To: • 68,000 Square Feet • 660 Employee Capacity • Approximately 90% of Current Chennai Employees are Technical Staff 13
Slide 14: Long Term Financial Targets
Long Term Financial Targets TECHNOLOGY | INNOVATION | SOLUTIONS Revenue Possibilities 290 270 Current 250 12/31/17 EV/Rev 230 EV/Rev 3.2 210 1.9 190 170 150 130 FY18 FY19 FY20 FY21 FY22 20% CAGR 15% CAGR 10% CAGR Targeting Four-Year Revenue Growth CAGR of between 10% - 20% and AOE of between 10%-20%
Slide 15: Financial Overview
FINANCIAL OVERVIEW
Slide 16: Evolving Business, Evolving P&L
Evolving Business, Evolving P&L TECHNOLOGY | INNOVATION | SOLUTIONS Financial Metrics and Valuation (*TTM) Business Metrics (as of 12/31/18) Share Price (2/19/19) $20.43 Direct POS End Points Managed ~53k Diluted Shares Outstanding 23.0M Y/Y Growth 20% Diluted Market Capitalization $470.9M Direct Ho
Slide 17: We Provide Industry Leading Hospitality Solutions
We Provide Industry Leading Hospitality Solutions TECHNOLOGY | INNOVATION | SOLUTIONS PROPERTY POINT-OF-SALE MANAGEMENT 63% of Revenue 25% POS Solutions of Revenue PMS Solutions ~53k end points at 12/31/18 ~271k rooms at 12/31/18 +20% since 12/31/17 9% +6% since 12/31/17 of Revenue DOCUMENT INVENTOR
Slide 18: Strong Balance Sheet
Strong Balance Sheet TECHNOLOGY | INNOVATION | SOLUTIONS Consolidated Balance Sheet (in thousands) March 31, 2018 December 31, 2018 Cash, Cash Equivalents and Marketable Securities $39,943 $36,995 Other Current Assets 23,981 43,761 Long-Term Assets 93,283 86,677 Total Assets $157,207 $167,433 Curren
Slide 19: Historical Financial Results - Trailing Twelve Months
Historical Financial Results - Trailing Twelve Months TECHNOLOGY | INNOVATION | SOLUTIONS Revenue - GAAP Net Loss - GAAP $140,000 $136,280 ($1,000) $135,000 ($6,000) ($3,765) $130,000 $127,678 $127,360 $125,000 ($8,350) $120,366 ($11,000) ($9,785) $120,000 ($11,721) ($16,000) $115,000 FY16 FY17 FY18
Slide 20: Revenue - Quarterly
Revenue - Quarterly TECHNOLOGY | INNOVATION | SOLUTIONS Total Revenue $37,000 $36,014 $36,000 $35,000 $34,203 $33,865 $34,007 $34,000 $33,448 $33,000 $32,676 $32,056 $32,000 $31,310 $31,000 $30,602 $30,129 $30,000 $29,000 $28,000 $27,000 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Al
Slide 21: Profitability Metrics - Quarterly Adjusted Earnings from Operations
Profitability Metrics - Quarterly TECHNOLOGY | INNOVATION | SOLUTIONS Adjusted Earnings from Operations – Non GAAP^ $1,995 $2,000 $1,858 $1,000 $564 $237 $0 ($1,000) ($1,158) ($1,440) ($2,000) ($1,909) ($3,000) ($3,100) ($3,475) ($4,000) ($3,779) Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19
Slide 22: Profitability Metrics - Quarterly Adjusted EBITDA
Profitability Metrics - Quarterly TECHNOLOGY | INNOVATION | SOLUTIONS Adjusted EBITDA – Non GAAP^ $3,500 $3,113 $2,965 $3,061 $3,000 $2,641 $2,500 $2,310 $2,069 $2,135 $2,000 $1,640 $1,500 $1,308 No Software Capitalization $1,000 in Q2 FY19 or Q3 FY19 $500 $0 ($500) ($234) Q2'17 Q3'17 Q4'17 Q1'18 Q2
Slide 23: Adjusted EBITDA less Capitalized Software Development Costs
Profitability Metrics - Quarterly TECHNOLOGY | INNOVATION | SOLUTIONS Adjusted EBITDA less Capitalized Software Development Costs – Non GAAP^ $3,000 $2,584 $2,135 $2,000 $1,415 $981 $1,000 $274 $0 ($177) ($385) ($1,000) No Software ($1,350) Capitalization ($2,000) ($1,646) in Q2 FY19 or Q3 FY19 ($3,
Slide 24: Appendix
APPENDIX
Slide 25: Senior Management Leading New Growth Vision
Senior Management Leading New Growth Vision TECHNOLOGY | INNOVATION | SOLUTIONS RAMESH SRINIVASAN - President and Chief Executive Officer Ramesh is an accomplished CEO with leadership and turnaround success across multiple industries resulting in rapid and sustainable long-term growth and significan
Slide 26: Senior Management Leading New Growth Vision
Senior Management Leading New Growth Vision TECHNOLOGY | INNOVATION | SOLUTIONS KYLE C. BADGER - Senior Vice President, General Counsel and Secretary Kyle leads the global legal and human resources teams, and brings over 22 years of legal experience representing public and private companies in gener
Slide 27: Senior Management Leading New Growth Vision
Senior Management Leading New Growth Vision TECHNOLOGY | INNOVATION | SOLUTIONS ROB JACKS – Chief Information Officer Rob was promoted to CIO in December 2018 and is responsible for advancing Agilysys’ internal systems and information technology processes. Rob has a reputation as a transformational
Slide 28: Non-GAAP Reconciliation
Non-GAAP Reconciliation TECHNOLOGY | INNOVATION | SOLUTIONS AGILYSYS, INC. RECONCILIATION OF NET LOSS TO ADJUSTED EARNINGS FROM OPERATIONS (UNAUDITED) Twelve Months Ended March 31 (In thousands) TTM* 2018 2017 2016 Net loss$ (9,785) $ (8,350) $ (11,721) $ (3,765) Income tax expense (benefit) (1,626)
Slide 29: Non-GAAP Reconciliation
Non-GAAP Reconciliation TECHNOLOGY | INNOVATION | SOLUTIONS RECONCILIATION OF NET LOSS TO ADJUSTED EARNINGS FROM OPERATIONS (UNAUDITED) Three Months Ended December 31, September 30, June 30, March 31, December 31, September 30, June 30, March 31, December 31, September 30, (In thousands) 2018 2018 2
Slide 30: Cash Flow
Cash Flow TECHNOLOGY | INNOVATION | SOLUTIONS TTM* FY18 FY17 FY16 Operating activities Loss from continuing operations $ (9,785) $ (8,350) $ (11,721) $ (3,765) Non cash adjustments, restructuring, legal settlements 18,594 16,586 14,110 7,741 Changes in assets & liabilities (2,312) (1,362) 1,044 3,24
Slide 31: Agilysys Global Footprint
Agilysys Corporate Headquarters Agilysys Global Footprint • Alpharetta, Georgia Agilysys US Offices • Las Vegas, Nevada • Santa Barbara, California • Bellevue, Washington Agilysys EMEA Office Windsor, UK • United Kingdom Seattle, WA Las Vegas, NV Agilysys APAC Offices Santa Barbara, CA Alpharetta, G
Slide 32: Contact
Contact: Tony Pritchett Chief Financial Officer (770) 810-7941 Richard Land / Norberto Aja InvestorRelations@agilysys.com JCIR (212) 835-8500 Dave Wood agys@jcir.com VP of Finance (770) 810-7920 InvestorRelations@agilysys.com 32