Tantalus Systems Holding Inc · TSX:GRID
Tantalus Systems — Investor Presentation (August 2024)
35 slides from Tantalus Systems's investor presentation, August 2024
Slide 1: Modernize the Grid by Harnessing the Power of Data
TANTALUS.COM August 2024 MODERNIZE THE GRID BY HARNESSING THE POWER OF DATA CORPORATE 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$12
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
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 – UL
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 $10B 10-15% total addressable growth rate of existing market Tantalus business TSX: GRID Confidential and Proprietary
Slide 18: Financial Summary
FINANCIAL SUMMARY Through June 30, 2024
Slide 19: How Tantalus Generates Revenue
How Tantalus Generates Revenue Deploying connected devices leads to recurring revenue over 12 – 15 years Recurring Software Maintenance & SaaS Subscriptions (Data Analytics) Software & Perpetual Software Analytics License Annual Technical Support Agreements Professional Deployment / Project Manageme
Slide 20: Increasing Annual Recurring Revenue Growth
Increasing Annual Recurring Revenue Growth Continuing to increase the revenue contribution from Recurring Revenue each year Recurring Revenue is comprised of SaaS subscriptions, term-based Recurring Revenue (US$M) software licenses, software maintenance, technical support and $12.0 30% hosting servi
Slide 21: Q2 '24 Income Statement Summary
Q2 ‘24 Income Statement Summary Continuing to invest in the commercialization of the TRUSense Gateway Slight decline in revenue year-over-year primarily due to last year’s conversion of software license with an investor-owned utility and capacity allocations with metering partners Gross Profit Margi
Slide 22: Q2 '24 Revenue Contribution & Gross Profit Margin Summary
Q2 ‘24 Revenue Contribution & Gross Profit Margin Summary Favorable trajectory tied to product mix and prudent supply chain management 62% 68% 38% 32% 28% 23% 53% 47% 42% 34% 72% 74% 65% 69% 35% 31% 24% 18% 51% 45% 41% 33% 70% 73% 65% 63% 35% 37% 24% 25% 55% 23% 56% 44% 41% 74% 80% Note: Reflects pe
Slide 23: Q2 '24 TTM Income Statement Summary
Q2 ‘24 TTM Income Statement Summary Continuing to trend towards positive Adjusted EBITDA and Net Income Decline in revenue tied to one-time C.IQ Connect/TRUSync software license secured in 2023 and capacity constraints with metering partners Increased Gross Profit Margin tied to favorable product mi
Slide 24: Q2 '24 TTM Revenue Contribution & Gross Profit Margin Summary
Q2 ‘24 TTM Revenue Contribution & Gross Profit Margin Summary Maintaining favorable Gross Profit Margin above our long-term target of 50% 64% 67% 65% 36% 67% 33% 35% 33% 25% 24% 22% 22% 52% 53% 50% 48% 40% 43% 34% 37% 74% 75% 72% 76% Note: Reflects percentage contribution of total revenue. Note: Ref
Slide 25: Q2 '24 Balance Sheet Summary
Q2 ‘24 Balance Sheet Summary Improvements across the Balance Sheet provide ample flexibility to scale CDN$10M financing and improved Adjusted Working Capital led to a stronger Balance Sheet Collected remaining balance of ARR renewals to improve cash conversion cycle Entering Q3 ‘24 with availability
Slide 26: Capitalization Overview
Capitalization Overview $2.50 $2.00 $1.50 $1.00 $0.50 $0.00 8/8/23 8/22/23 9/5/23 9/19/23 10/3/23 10/17/2310/31/2311/14/2311/28/2312/12/2312/26/23 1/9/24 1/23/24 2/6/24 2/20/24 3/5/24 3/19/24 4/2/24 4/16/24 4/30/24 5/14/24 5/28/24 6/11/24 6/25/24 7/9/24 7/23/24 8/6/24 TSX-Listed, Symbol: GRID Debt (
Slide 27: Management
Experienced Leadership Team Management Peter Londa George Reznik Michael Julian Doug Campbell Michael Grandis Tom Allen CEO & Board Member CFO CRO CSO Chief Legal & EVP, Product Administrative Officer Development Board Laura Formusa Dr. Francis Harvey Tom Liston John McEwen Greg Williams Chair Board
Slide 28: Why Invest in Tantalus?
Why Invest in Tantalus? Market Catalysts Substantive Business Growth Catalyst Electrification of Differentiated Solutions TRUSense Gateway Everything & Grid With Growing User Provides a Compelling Modernization Community Growth Opportunity TSX: GRID Confidential and Proprietary | Page 28
Slide 29: Questions?
QUESTIONS? tantalus.com deborah@adcap.ca TSX: GRID
Slide 30: Appendix
Tantalus APPENDIX
Slide 31: Building Momentum for GRID
Building Momentum for GRID Annual Financial Performance (US$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 be $10.5
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