Wisetech Global Ltd. · ASX:WTC
Wisetech Global — Investor Day (December 2020)
117 slides from Wisetech Global's investor day presentation, Dec 3, 2020
Slide 1: WiseTech Global Digital Investor Day 2020 ASX Announcement
ASX Announcement: 2020/70 For personal use only 3 December 2020 WiseTech Global Digital Investor Day 2020 WiseTech Global’s Digital Investor Day 2020 will be held today, 3 December 2020. The event will include presentations, panel sessions, product demonstrations and Q&A on WiseTech Global’s product
Slide 2: CEO Introduction
CEO INTRODUCTION Good morning everyone and welcome to WiseTech’s virtual Investor Session. The purpose of today’s session is to provide you with greater insight into how we see the opportunity that exists for WiseTech in terms of: For personal use only o the size of our total addressable market and
Slide 3: Acceleration of structural changes
Acceleration of structural changes Recent events such as Brexit, trade tensions and many others, are compounding the complexity of global logistics operations and dramatically increasing the volume, complexity and compliance requirements of import and export customs entries. Formal requirements for
Slide 4: Complexity of the market
As the software industry has evolved, in particular with SaaS and cloud-based delivery systems, and given the substantial requirements that apply to all providers, there has been a move away from self-developed, proprietary software solution development towards commercial software that provides econ
Slide 5: Company history and CargoWise development
In 2002, we turned our attention to developing a features-rich software solution that could meet the needs of multi-region logistics service providers. By 2004, we had developed our second generation global software solution – ediEnterprise. Having built and implemented in New Zealand and Singapore,
Slide 6: CargoWise standardisation differentiator
This is an important differentiator of CargoWise vis-à-vis our peers and a characteristic of our offering that cannot be easily replicated. We have remained true to our commitment to standardisation rather than customisation and have not customised code for customers since 2008. Instead, we have lea
Slide 7: Designing integrated solutions for industry pain points
Designing integrated solutions for industry pain points Today, CargoWise provides a unique customer value proposition that differentiates it from competitors and positions us well to continue to grow our market penetration. We offer customers a global application built on a single dataset with integ
Slide 8: Global rollout momentum
We have made significant progress in signing up global rollouts for freight forwarders with a dramatic ramp-up occurring more recently. It took us a more than decade to sign up our first seven global rollouts for freight forwarders, but momentum has been gaining pace. In the past nine months we have
Slide 9: Strategy: Product, Penetration, Profitability, People
o accelerating our market penetration and competitive edge by remaining attentive to strategic acquisition opportunities albeit at a less aggressive rate than we have adopted over the past four years. You will hear shortly from the team who will talk to our focus on: Product, Penetration, Profitabil
Slide 10: CEO Closing Address
CEO CLOSING ADDRESS To wrap up the Investor Day, the key take-out I’d like to leave you with is that – our vision is unwavering – we are building a world-leading organisation, with a clear goal to empower and enable the world’s supply chains. Our “slower today, faster forever” and “productivity at t
Slide 11: CFO Address: commercial model
CFO ADDRESS WiseTech’s commercial model: driving sustainable revenue growth and enhancing profitability Good morning, everybody. You have heard us talk today about WiseTech’s total addressable market, what differentiates CargoWise from competitor offerings and our For personal use only strategy to i
Slide 12: STL revenue model based on a win-win philosophy
STL revenue model based on a ‘win-win’ philosophy So, let’s take a closer look at how we derive that upside. The variables that drive our revenue growth under the STL model reflect the customer’s journey from local solution to full global rollout and the productivity benefits and efficiency gains th
Slide 13: Revenue growth drivers
Revenue growth drivers I’d like to pause here and talk about ‘value versus price’ as a driver of customer behaviour and decision making. We’ve spoken extensively about the productivity gains, cost reductions and efficiencies that CargoWise is designed to deliver to our customers. For personal use on
Slide 14: Global revenues – a natural FX hedge
Global revenues – a natural FX hedge I might pause here to highlight the fact that we are a global company with customers operating in 160 countries. 75% of our FY20 Group revenue was generated in currencies other than Australian dollars. When you think about the foreign exchange position in our bus
Slide 15: Cost savings and R&D investment
As I mentioned earlier, we are focused on removing duplication, with significant cost savings ear-marked to be delivered in both FY21 and FY22 as this process takes place. Driving revenue growth through continued investment in R&D Whilst our commercial model is designed to enable low maintenance, ma
Slide 16: CFO summary
ample financial headroom to fund future growth initiatives and an efficient, low-cost operating structure designed to enhance profitability and drive future revenue and growth. Our product, CargoWise, is a ‘win-win’ offering that aligns WiseTech’s growth to customer productivity gains and usage expa
Slide 17: Empowering and enabling the world's supply chains
Empowering and enabling the world’s supply chains For personal use only WiseTech Global Digital Investor Day 3 December 2020
Slide 18: Our innovations empower the world's supply chains
For personal use only Our innovations and global technology empower, enable and improve the world’s supply chains. We are a force for good, improving productivity, connectivity and resource usage across 160 countries worldwide.
Slide 19: Agenda
Agenda For personal use only 1 CEO introduction: 4 Strategic priorities – the focus is global 2 Product: 17 The state of innovation – current and future development 3 Penetration: 33 Capturing the globals – the customer experience and digital transformation 4 Profitability: 62 A commercial model tha
Slide 20: CEO introduction: Strategic priorities
For personal use only CEO introduction: Strategic priorities - the focus is global Richard White Founder and Chief Executive Officer 4 © 2020 WiseTech Global
Slide 21: Introduction
Introduction For personal use only Total addressable Competitive Strategic focus Product market landscape demos R&D pipeline Integration Commercial Meet WTC update model team 5 © 2020 WiseTech Global
Slide 22: Total addressable market
Total addressable market Global logistics For personal use only Global supply chain 5% p.a. until 20231 Global 3PL Global 2PL Global 1PL Global Third party Carriers (Ocean, Shippers and logistics providers, Air, Rail, Road, LTL, beneficial cargo logistics market including top 150 FTL, Parcel, owners
Slide 23: The supply chain management IT segment
The supply chain management IT segment For personal use only Procurement 34% Global supply Supply Global supply chain software chain chain software execution execution IT 31% management IT segment (2019)1 segment (2019)2 US$4.7 billion US$15.2 billion Supply chain planning 35% ~7% WiseTech FY20 reve
Slide 24: Acceleration of structural changes
Acceleration of structural changes Well positioned to transform the US$9 trillion1 global logistics market For personal use only Logistics providers pivot business models and remove legacy systems Move towards integrated digital solutions accelerates 8 © 2020 WiseTech Global 1. Source: Armstrong & A
Slide 25: Competitive landscape is fragmented
Competitive landscape is fragmented For personal use only – Competitive landscape is fragmented Procurement 34% – Our largest opportunity remains replacing legacy systems – WiseTech is in early stage penetration of the Supply Global supply $USD 4.7 billion1 supply chain execution segment chain chain
Slide 26: Complexity of the market
Complexity of the market For personal use only Truly integrated software is Software user familiarity and expensive, requiring significant business integration create testing and regular updates. customer ‘stickiness’. Attracting talent and building Extensive datasets take time specialist tech teams
Slide 27: What differentiates WiseTech from its competitors
What differentiates WiseTech from its competitors Our evolution - product, penetration, profitability and people For personal use only Model development Building global model Global foundation CargoWise and listing Resources and foothold ’94 – ‘03 ‘04 – ‘07 ‘08 – ‘14 FY15 – FY17 FY18 – FY20 PRODUCT
Slide 28: Slower today, faster forever
‘Slower today, faster forever’ For personal use only We committed ourselves to standardising the millions of global variations in freight forwarding across: − Countries − Currencies 2.5 million − Languages − Customs − International Regulations development − Trade Lanes − Transport Modes − Convention
Slide 29: Designing integrated solutions for industry pain points
Designing integrated solutions for industry pain points For personal use only 13 © 2020 WiseTech Global
Slide 30: The CargoWise customer value proposition
The CargoWise customer value proposition For personal use only Across With third party geographies systems Within and With customers With government across modules and partners systems Pay for one system Learn one system Set up one system Enter data in one system Universal price list Thousands of le
Slide 31: Size of the prize for WiseTech
Size of the prize for WiseTech Early stages of market penetration For personal use only CEVA CARGO PARTNER HELLMANN A.HARTRODT 2000 - 2008 TOLL ROHLIG MAINFREIGHT ARAMEX LOGISTICS PLUS OIA PANALPINA* WACO/TIGERS DSV DHL LOGWIN SEAFRIGO LF LOG UTi# DEWELL YUSEN GEODIS XPO JAS BOLLORÉ Launch of WTC GE
Slide 32: Capitalising on the opportunity by focusing on the 3Ps
Capitalising on the strategic opportunity by focusing on the 3Ps For personal use only Expand Expand Drive technology market operational lead penetration efficiency Product Penetration Profitability ⎻ Expanding global CargoWise ⎻ Enabling greater usage ⎻ Self-service portal platform through innovati
Slide 33: Product: The state of innovation
For personal use only Product: The state of innovation – current and future development 17 © 2020 WiseTech Global
Slide 34: Product vision: The future of innovation
For personal use only Product vision: The future of innovation Richard White Mike Sverdlov Chief Technology Officer, Founder and CEO US Development 18 © 2020 WiseTech Global
Slide 35: CargoWise Neo global integrated platform
CargoWise Neo is a global integrated platform for the consumers of logistics services For personal use only Freight forwarders BCOs direct to and logistics providers a carrier or carriers Global cargo market Designed to digitise, automate and extend the market into this area 19 © 2020 WiseTech Globa
Slide 36: CargoWise Neo connector between logistics parties
CargoWise Neo is the connector between logistics providers, importers, exporters and freight users For personal use only 20 © 2020 WiseTech Global
Slide 37: CargoWise Neo leverages CargoWise technology
CargoWise Neo leverages CargoWise technology, our network foundation and global data sets For personal use only Dashboard – track jobs at a glance – Shows the most recent jobs – Combines forwarding shipments, declarations, purchase orders, and other job types – Movement progress indicator – Drill do
Slide 38: Product development: state of innovation
For personal use only Product development: The state of innovation and development Brett Shearer Igor Malin Angela Gadaev Product Portfolio Manager, Chief Technology Officer Data Scientist International Logistics Glenn Lawson Stephen Dascoli International Ecommerce Customs Product Manager Product Ma
Slide 39: Investing in product development
We invest relentlessly in product development and are united in our vision to create the operating system For personal use only for global logistics 51% employees focus on product development 1,100 product upgrades and enhancements in FY20 >861,000 unit tests executed every 45 minutes 40 developmen
Slide 40: Innovation pathway: PAVE and GLOW
Our innovation pathway ensures rapid application development at high quality with efficient resource use For personal use only We look for the root cause of our customers’ problem and solve for that pain point. PAVE | Productivity Acceleration Visualisation Engine - Manage global development teams -
Slide 41: Automation, master data, machine learning: the challenge
AUTOMATION, MASTER DATA, MACHINE LEARNING The challenge Logistics providers cannot make accurate decisions For personal use only with incorrect or incomplete data Multiple parties duplicating documentation Increasing volume of transactions Managing vast High volumes of Incorrect address disparate, n
Slide 42: Automation, master data, machine learning: our solution
AUTOMATION, MASTER DATA, MACHINE LEARNING Our solution Data availability, speed, accuracy and quality for all parties involved For personal use only Data entry Data normalisation Value extraction Search and relevancy Decision support Data analytics and industry insights 1 Eliminate 2 Automate 3 Opti
Slide 43: Global rates engine: the challenge
GLOBAL RATES ENGINE The challenge Manually searching for rates, tariffs and other charges is time consuming, For personal use only error prone and costly − Costs are collected and compared from hundreds − Rapidly growing spot market CHALLENGES of service providers and carriers − Different basis for
Slide 44: Global rates engine: our solution
GLOBAL RATES ENGINE Our solution A global rates engine to aggregate, standardise and normalise rates For personal use only across providers and modes Features available now: Global data set of buy and sell rates Auto-costing and auto-rating instantly search and apply buy and sell rates to shipments
Slide 45: Global customs platform: the challenge
GLOBAL CUSTOMS PLATFORM The challenge Growing complexity in world trade continues to put pressure For personal use only on global supply chains Seamless import and export require vast amounts of documentation, involving multiple parties and message types. The customs compliance landscape Acquisition
Slide 46: Global customs platform: our solution
GLOBAL CUSTOMS PLATFORM Our solution One system to create, manage and clear import and export customs For personal use only declarations in 30 countries Mitigate regulatory risk, reduce spend and streamline import clearances Simplify export processes, safeguard against regulatory exposure and avoid
Slide 47: International ecommerce: the challenge
INTERNATIONAL ECOMMERCE The challenge The rise of ecommerce has significantly increased the demand For personal use only for logistics services The B2B ecommerce market is growing International ecommerce is critical to growth What challenges do you face with your cross-border ecommerce (other than c
Slide 48: International ecommerce: our solution
INTERNATIONAL ECOMMERCE Our solution A single platform for the entire international ecommerce fulfilment supply chain For personal use only An integrated information flow from origin to destination Manage customs declarations Automate orders, consignments and shipper manifests Manage international c
Slide 49: Penetration: Capturing the globals
For personal use only Penetration: Capturing the globals - the customer experience and digital transformation 33 © 2020 WiseTech Global
Slide 50: Capturing globals: The Delta salesforce
For personal use only Capturing globals: The Delta salesforce Gene Gander General Manager, Global Sales 34 © 2020 WiseTech Global
Slide 51: Logistics industry under immense pressure
The logistics industry is under immense pressure to do more with less, while moving more for less For personal use only Capital Margin High constraints pressures fragmentation Public health Regulatory Resource concerns compliance shortages 35 © 2020 WiseTech Global
Slide 52: Customers cannot innovate reliant on disparate systems
Customers cannot innovate if they are reliant on disparate, costly or unsecure systems For personal use only 36 © 2020 WiseTech Global 1. McAfee, 2017, Custom applications and IaaS trends 2017.
Slide 53: Our customers: third party logistics providers
Our customers: third party logistics providers For personal use only 42 of the top 50 third party logistics providers1 and 30 use CargoWise Our global platform is available across 160 countries worldwide 37 © 2020 WiseTech Global 1. Armstrong & Associates: Top 50 Global Third Party Logistics Provide
Slide 54: Our customers: global freight forwarders
Our customers: global freight forwarders For personal use only 25 of the top 25 global freight forwarders1 use our solutions across 160 countries worldwide and 23 use CargoWise “Transcending the challenges in global logistics sustainably and further developing the service quality for our customers,
Slide 55: Significant runway for increased usage and expansion
There is significant runway for increased usage and expansion across our extensive base For personal use only 250 CargoWise application suite revenue by customer cohort A$m, FY15 - FY20 200 Increasing uptake and progress of global rollouts 150 for the world’s largest logistics providers. Every cohor
Slide 56: Global rollouts take time, with significant value once complete
Global rollouts take time, with significant value and future opportunity once complete For personal use only Transactions on CargoWise Access other Efficiencies Events, modules from network on Enterprise CargoWise delegations Utilise new Integration Exception-led products Workflow Master Data mgmt W
Slide 57: Customers stay and grow transaction usage
Our customers stay and grow their transaction usage due to the productivity of the platform For personal use only 250 CargoWise application suite revenue by customer cohort A$m, FY15 - FY20 200 150 <1% attrition every year for the last 8 years1 100 50 0 FY15 FY16 FY17 FY18 FY19 FY20 FY06 & prior FY0
Slide 58: Global rollouts continue to increase
Global rollouts continue to increase across 3PLs and global freight forwarders, enhancing value over time For personal use only CargoWise has 23 large CEVA global freight forwarders^ with global rollouts in CARGO PARTNER process or completed. HELLMANN 11 of these are in the top 25. A.HARTRODT 2000 -
Slide 59: Global depth and reach of CargoWise
The global depth, reach and capability of CargoWise is purpose built for the needs For personal use only of the world’s largest logistics organisations 43 © 2020 WiseTech Global
Slide 60: CargoWise transforms end-to-end logistics processes
CargoWise transforms and For personal use only optimises end-to-end logistics processes, putting productivity at the centre of logistics operations 160 30 ~3,900 countries languages features and enhancements in the past 5 years 44 © 2020 WiseTech Global
Slide 61: The customer experience: Aramex
For personal use only The customer experience: Aramex Mohammed Sleeq Gene Gander Chief Digital Officer, General Manager, Global Sales Aramex 45 © 2020 WiseTech Global
Slide 62: Speaker biography Mohammed Sleeq
Speaker biography Mohammed Sleeq, Chief Digital Officer (CDO) For personal use only Mohammed Sleeq joined Aramex in 2013 and was appointed CDO in December 2018. As the company’s CDO, Mr Sleeq leads Aramex’s transformation aspirations, and is responsible for the execution of the company’s business tr
Slide 63: Aramex overview
Aramex overview Aramex is a Global Provider of Logistics and Transportation Solutions For personal use only 15,623 | 600+ in 65+ | AED 4.0 | AED 6.3 Employees Offices Countries Billion Revenues Billion Market Cap We understand that delivering from one side of the country to another requires efficien
Slide 64: The customer experience: DHL
For personal use only The customer experience: DHL Tim Scharwath Gene Gander CEO, DHL Global Forwarding, Freight General Manager, Global Sales 48 © 2020 WiseTech Global
Slide 65: Speaker biography Tim Scharwath
Speaker biography Tim Scharwath Member of the Management Board of Deutsche Post DHL Group CEO, DHL Global Forwarding, Freight For personal use only Tim Scharwath has been a Member of the Management Board of Deutsche Post DHL Group since June 2017. He is responsible for DHL’s air, ocean and overland
Slide 66: For personal use only
For personal use only 50 © 2020 WiseTech Global
Slide 67: CargoWise roll-out progressing very well
CargoWise roll-out progressing very well Benefit realisation started For personal use only 51 © 2020 WiseTech Global
Slide 68: IT Renewal Roadmap & Digital Customer Interaction
With IT Renewal Roadmap & Digital Customer Interaction, full form of DGF is enhancing customer experience while increasing operational efficiency For personal use only IRR - IT Renewal Roadmap: Our Digital Backbone established 52 © 2020 WiseTech Global
Slide 69: Future of the logistics industry: Accelerating digital transformation
For personal use only Future of the logistics industry: Accelerating digital transformation Håkan Nilsson Chief Executive Officer, Zinnovate International Zinnovate is at the forefront of the logistics industry - committed to helping large-scale logistics firms realise the full value of their IT inv
Slide 70: For personal use only
For personal use only 54 © 2020 WiseTech Global
Slide 71: Zinnovate helps logistics organisations transform
For personal use only Zinnovate helps logistics organisations transform from local to global optimisation with CargoWise Competence Trusted CargoWise Partner since 2013. Global network of 70+ consultants. Partner with many of CargoWise's largest customers to deliver true business transformation. Col
Slide 72: Competence, Collaboration, Chemistry
For personal use only Competence Our mantra is to help our customers make the whole more than the sum of its parts, across systems, processes and the organisation Collaboration Chemistry 56 © 2020 WiseTech Global
Slide 73: CargoWise purpose built for the world's largest logistics companies
For personal use only CargoWise is purpose built to meet the needs of the world’s largest logistics companies Deep Global Comprehensive Highly functionality reach integrations configurable Optimise supply chains Licensed across 160 Connect to government Parameter settings across all modes countries
Slide 74: Trends transforming the logistics industry
For personal use only A number of evolving trends are transforming the logistics industry. 1 2 3 Industry Accelerated Increased expansion into digital ecommerce new territory transformation demand 58 © 2020 WiseTech Global
Slide 75: Trend: industry expansion into new territory
For personal use only Evolving trend Solution Large forwarders are Logistics companies need expanding their reach to a single platform software become full house logistics solution that can optimise providers, supporting their supply chain across all customers from origin to modes and borders. desti
Slide 76: Trend: accelerated digital transformation
For personal use only Evolving trend Solution The pandemic has Logistics companies need accelerated digital a secure, deeply integrated transformation, revealing software solution to embed the risks of an old-school, digital processes and drive unsecure, multiple platform innovation throughout their
Slide 77: Trend: increased ecommerce demand
For personal use only Evolving trend Solution The ecommerce boom is Logistics companies need here to stay, with last mile one platform for the entire delivery challenges and international ecommerce increasing customer fulfilment supply chain, expectations exacerbated enabling faster, safer and by th
Slide 78: Profitability: A commercial model that drives sustainable revenue growth
For personal use only Profitability: A commercial model that drives sustainable revenue growth and enhances profitability 62 © 2020 WiseTech Global
Slide 79: Acquisitions and integration
For personal use only Acquisitions and integration: Becoming part of the WiseTech Global family Mark Hall Head of Acquisitions and Integration 63 © 2020 WiseTech Global
Slide 80: Acquiring assets for geographic expansion
Acquiring assets for geographic expansion Small targeted acquisitions in key regions provide safer, faster, stronger entry to new markets For personal use only We are building the world’s customs platform, designed to cover ~90% of manufactured trade flows Geo – foothold acquisitions ⎼ We buy into l
Slide 81: Acquiring adjacency assets for innovation pipeline
Acquiring adjacency assets for innovation pipeline Building and extending CargoWise ecosystems For personal use only Adjacency acquisitions ⎼ We accelerate convergence of technologies by adding targeted acquisitions of key adjacencies to our innovation pipeline to build valuable ecosystems and globa
Slide 82: Multi-stage, multi-year integration process
Our multi-stage, multi-year integration process is designed to generate long-term value For personal use only INTEGRATION PROCESS Business integration Product integration Sustainable and profitable future growth ⎻ Finance Product interface ⎻ Native re-write; or ⎻ Convert customers ⎻ Information syst
Slide 83: Productivity at the core of integration
Productivity is at the core of everything we do, driving efficiencies throughout the integration process For personal use only Prioritise quality over Focus on test first Utilise automated Deploy universal, speed – slower today, and automated testing workflow tools – PAVE scalable content faster for
Slide 84: Five key principles for integration
Five key principles help ensure the integration process is global, efficient and scalable For personal use only We ensure We start our We work in a We understand We focus alignment from integration work scalable way and the differences on doing the the start early create an and leverage most importa
Slide 85: Customs integration and roadmap
Customs integration and roadmap For personal use only Customs becomes native to the CargoWise platform, available to all CargoWise customers and to acquired customers who convert over time. Live CargoWise Planned FY21 Planned for FY22 Planned for FY23 France (EasyLog) Belgium (ABM Data) Argentina Au
Slide 86: Acquiring adjacency assets for innovation pipeline
Acquiring adjacency assets for innovation pipeline For personal use only SmartFreight expanding into UK, CMS integration complete Freight interface to CargoWise ready for pilot. 2020 mobility within CargoWise. Trinium executed large customer SaaS Trans pilot testing of SaaS LTL rollouts, 1H21 beta t
Slide 87: Driving operational efficiency: Transforming for global growth
For personal use only Driving operational efficiency: Transforming for global growth Vlad Bilanovsky Chief Execution Officer 71 © 2020 WiseTech Global
Slide 88: Significant growth since IPO in 2016
We have experienced significant, sustainable growth since IPO in 2016 For personal use only 2016 2020 525 people ~2,000 people 14 offices 55 offices 7 countries 30 countries Countries with licensed users WiseTech offices Headquarters Global data centres 72 © 2020 WiseTech Global
Slide 89: Opportunity to deliver efficiencies and cost savings
Opportunity to deliver efficiencies, productivity improvements and cost savings For personal use only Shared functions across Centralising physical Aligning our product global operations and operations and and development teams removal of duplication development hubs in by co-locating teams critical
Slide 90: Opportunity to generate operational efficiencies
Opportunity to generate operational efficiencies and cost savings For personal use only Initiatives are Positioning us to deliver accelerated value-creation, return on well underway investment, capability and growth. 74 © 2020 WiseTech Global
Slide 91: Commercial Model: Driving sustainable revenue growth
For personal use only Commercial Model: Driving sustainable revenue growth and enhancing profitability Andrew Cartledge Chief Financial Officer 75 © 2020 WiseTech Global
Slide 92: Sources of revenue generation
Sources of revenue generation For personal use only Existing customers New customers/contracts Strategic acquisitions – Continued rollout and growth Six new global customer rollouts Over 40 acquisitions delivered – Increased transactions & users signed in 2020 faster entry into: – Adopting new produ
Slide 93: Revenue leverage fueled by On-Demand licensing
Revenue leverage fueled by ’On-Demand’ licensing For personal use only Group revenue by license type (A$m) $429.4 47.4 OTL & support services $348.3 72.8 OTL maintenance 40.7 57.8 $221.6 22.9 $153.8 27.7 11.4 309.2 On-Demand (incl. STL) $103.3 15.1 249.8 1.7 15.4 171.0 127.3 86.2 FY16 PF 1 FY17 FY18
Slide 94: Evolution of the WiseTech licensing model
Evolution of the WiseTech Global licensing model For personal use only On-Demand Licensing – 72%1 of Revenue Seat + Transaction Licensing (STL) Revenue drivers Price drivers: Volume drivers: - Price per transaction - Number and size of customers per Module User - Price per user month License - Activ
Slide 95: STL revenue model based on win-win philosophy
STL revenue model based on a ’win-win’ philosophy STL revenue 94% of all CargoWise revenue1 For personal use only STL Revenue FY20 CargoWise transaction volumes are not entirely correlated to wider industry volumes, but are instead driven by: Stable and growing ~50% Increased market Transactional pe
Slide 96: STL and long-term revenue growth network effect
STL and long-term revenue growth network effect Internal and external network effect For personal use only External network External network Additional internal users and transactions Initial customer team Additional internal users External network and transactions Global rollout 80 © 2020 WiseTech
Slide 97: Revenue growth drivers: value versus price
Revenue growth drivers Value versus price For personal use only Multiple software applications by multiple suppliers1 CargoWise provides an integrated software solution, requiring fewer users to process higher volumes of transactions 3rd party applications Proprietary applications Multiple vertical
Slide 98: Acquisition revenue and integration upside
Acquisition revenue and integration upside Integration process to deliver net cost savings For personal use only Many acquired businesses Transitioning acquired businesses to STL model with OTL model FY20 revenue Revenue flat/reduced during transition – 17% OTL maintenance (recurring) – 11% OTL and
Slide 99: Global revenues – a natural FX hedge
Global revenues – a natural FX hedge We are a global company operating in 160 countries For personal use only Revenue generated by invoicing location (FY20) (A$m) 75% of revenue generated in non-AUD currencies (FY20) Europe, Asia Pacific Middle East & $134.5 Africa (EMEA) $166.1 43% of revenue in no
Slide 100: Enhancing profitability
Enhancing profitability Managing the bottom line For personal use only % of revenue General and administration Sales and marketing Expenses (A$m) (A$m) (A$m) 22% 22% 100.0 25% 100.0 21% 20% 20% 20% 20% $84.1 15% 15% 80.0 13% 13% 15% 10% 10% 80.0 $68.3 10% 10% 5% 60.0 $57.0 60.0 5% $45.5 0% $44.0 0%
Slide 101: Driving revenue growth through continued investment in R&D
Driving revenue growth through continued investment in R&D For personal use only Product development and innovation key driver of long-term recurring revenue growth Investment 38% R&D % 34% 37% in Product 40% 33% 32% of Revenue Development 30% & Innovation20% $159.1 (A$m) 10% 0% 47% $113.0 74.2 Capi
Slide 102: Expenses compared to SaaS peers
Expenses compared to SaaS Peers R&D investment focus with efficient sales and marketing For personal use only R&D Investment1 Sales and marketing expense1 % of total revenue % of total revenue 44% 37% 35% 31% 30% 27% 21% 18% 16% 16% 15% 14% 13% 11% WiseTech Xero SAP Descartes Oracle Altium Cochlear
Slide 103: Robust cashflows
Robust cashflows Testament to high quality earnings Delivered $398 million EBITDA For personal use only over the past 5 years Operating cash flow $146.3 (A$m) $451 million operating cash flow $126.4 over the past 5 years $81.3 Closing cash balance $224 million (at 30 June 2020) $63.4 providing signi
Slide 104: High growth, low cost model means significant upside
High growth, low cost model means significant upside potential For personal use only Strong High quality Strong revenue growth recurring revenue balance sheet $224m in cash and CargoWise 97% recurring +43% CAGR in last 5 years undrawn facility of revenue in FY20 $190m (30 Jun 20) High EBITDA margin
Slide 105: Our people and culture: The WiseTech Global Way
For personal use only Our people and culture: The WiseTech Global Way 89 © 2020 WiseTech Global
Slide 106: Our people: Creating an environment for innovation
For personal use only Our people: Creating an environment for innovation to flourish Angelina McMenamin Head of Talent 90 © 2020 WiseTech Global
Slide 107: Talent, motivation and enthusiasm of our global team
The talent, motivation and enthusiasm of our diverse, global team drive our innovation and growth For personal use only 91 © 2020 WiseTech Global
Slide 108: Flat, low-hierarchy management system
We have a flat, low-hierarchy management system with small, diverse teams who are empowered to deliver For personal use only Anyone can talk to anyone at any time, for any reason Productivity at the centre of everything Find the root cause and solve for that Win-win or no deal Lead with content Slow
Slide 109: New hybrid model driven by five global principles
Our new hybrid model is driven by five global principles For personal use only Ensuring a safe Enhancing Nurturing Strengthening Supporting and effective productivity creativity and wellbeing and learning and setup and performance connections balance development We have an optimal We manage We have
Slide 110: Q&A
For personal use only Q&A Richard White Brett Shearer Gene Gander Founder and CEO Chief Technology Officer General Manager, Global Sales Mark Hall Vlad Bilanovsky Andrew Cartledge Head of Acquisitions Chief Execution Officer Chief Financial Officer and Integration 94 © 2020 WiseTech Global
Slide 111: Closing remarks
For personal use only Closing remarks 95 © 2020 WiseTech Global
Slide 112: Summary
Summary Well positioned to continue to grow and increase market penetration For personal use only Clear goal to empower and enable the world’s supply chains. Product pipeline and R&D providing competitive edge and significant profitability opportunity. Ideally positioned to deliver continued growth
Slide 113: Important notice and disclaimer
Important notice and disclaimer Content of presentation for information purposes only For personal use only Visit wisetechglobal.com/investors Preparation of information All financial information has been prepared and reviewed in accordance with Australian Accounting Standards. Certain financial dat
Slide 114: Appendices
For personal use only Appendices Image TBC 98 © 2020 WiseTech Global
Slide 115: Appendix - FY21 guidance
Appendix 1 - FY21 guidance Key assumptions and sensitivities For personal use only Background FY21 Guidance FY21 revenue 1. CargoWise: recurring revenue market share growth of 15%-30% ⎻ FY21 guidance based on five significant ⎻ allowed for 15-30% YOY organic growth (usual range 20-30%) parameters. ⎻
Slide 116: Appendix - FY21 guidance COVID-19 impact assumptions, F/X
Appendix 2 - FY21 guidance COVID-19 impact assumptions, F/X For personal use only What is included in the FY21 guidance: FX rates v AUD FY20 FY21 Foreign Exchange actual guidance − Retention of existing customers with CargoWise − 75% of FY20 revenue in non-AUD usage growth consistent with historical
Slide 117: Appendix – Total addressable market
Appendix 3 – Total addressable market For personal use only Ref. Data Point Description Value A Global Logistics Costs1 USD $9.3tr B Transportation & Logistics IT Expenditure2 USD $164bn C Global Supply Chain Management Expenditure3 USD $15.2bn C(i) Supply Chain Execution Expenditure3 USD $4.7bn C(i