Bango plc · LSE:BGO
Bango — H1 2013 Earnings Presentation
28 slides from Bango's earnings presentation, September 2013
Slide 1: Bango 1h2013 Interim Results
Bango 1h2013 Interim Results Six months to 30 June 2013 Ray Anderson CEO Gerry Tucker CFO © 2013 Bango plc www.bango.com
Slide 2: About Bango
About Bango Bango customers include: • Founded in 1999 to enable effective collection of payments from mobile device users • Leading global brands choose Bango for mobile payments and analytics • Bango technology, relationships and user data enable a superior user experience, 110+ operator relations
Slide 3: Focused on payment experience
Focused on payment experience Unique technology and One-click billing No registration partnerships 3/4G and Wi-Fi deliver a better Better analytics the payment Global reach experience Across thousands of digital merchants For hundreds of millions of customers 3
Slide 4: 1h2013 Highlights
1h2013 Highlights • 74% growth in end user spend vs 2h2012 – Margin within target range (2-5%) at 3.4% – Smartphone business now more than 95% of activity • Integrated with 28 more mobile operators in 1h2013 – Total at end of June 2013 was 112 direct integrations (60 in June 2012) – Development of u
Slide 5: 1h2013 Key developments
1h2013 Key developments • Direct connection to operator billing now exceeds 1.2 billion users • 0.25 billion of these already augmented with unique BangoID for faster and more reliable mobile operator or credit card billing • Transaction processing headroom increased from 10x to >100x – New technolo
Slide 6: Market developments
Market developments • Growing, dynamic and exciting market – Worldwide smartphone sales 2q2013 225m, up 46.5% vs. 2q2012* – Smartphone shipments expected to reach 958.8m by end 2013 (2012: 722.5m)** – More pervasive, less expensive; phablets emerging – Mobile advertising worldwide forecast to reach
Slide 7: The smartphone opportunity…
The smartphone opportunity… Smartphone base growing fast: Global smartphone App revenues growing fast: penetration growing fast: Android iOS Symbian RIM Bada Microsoft Autres 250 000,0 200,000,0 150 000,0 100 000,0 50 000,0 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2
Slide 8: Bango has a unique product offering
Bango has a unique product offering Extensive direct operator billing integration gives 200% to more than 1,000% sales uplift. The common BangoID across all services and apps boosts that further by enabling one click - even on Wi-Fi connections The BangoID “platform effect” drives sustained competit
Slide 9: The Bango advantage
The Bango advantage • Data from - One app store customer - Purchases made by customers on European operator • Large increase in overall purchase volumes and revenues • 200% sales uplift via Bango operator billing ~200% uplift 9
Slide 10: Bango is gaining momentum
Bango is gaining momentum Providers Platforms Smartphone users iTunes 10
Slide 11: BlackBerry World example
BlackBerry World example BlackBerry World operator billing using Bango payment APIs Customer selects Customer Customer app to buy clicks to purchase installs app Screenshots taken August 2013 – apps offered, pricing, exact flows , T&C subject to change based on customer requirements 11
Slide 12: Google Play
Google Play Google Play billing a Telstra mobile account using Bango payment processing Customer selects Customer Customer app to buy clicks to buy installs app Screenshots taken August 2013 – apps offered, pricing, exact flows , T&C subject to change based on customer requirements 12
Slide 13: Facebook mobile example (UK)
Facebook mobile example (UK) • Facebook HTML5 app collecting operator payments using Bango Customer selects Customer selects Customer confirms Payment is Facebook content payment method to buy confirmed Screenshots taken August 2013 – apps offered, pricing, exact flows , T&C subject to change based
Slide 14: Firefox Marketplace example
Firefox Marketplace example Firefox Marketplace operator billing, hosted by Bango Customer selects Customer Customer installs app to buy clicks to buy and launches app Screenshots taken August 2013 – apps offered, pricing, exact flows , T&C subject to change based on customer requirements 14
Slide 15: Components of Bango Platform
Components of Bango Platform Billing Collection Outpayment Identify / Locate Basics: Basics: Reporting Calculation BillRankTM Reconciliation Reconciliation Age verification Refunds Refunds Chargebacks Chargebacks Risk / Fraud Missing items Fees / fines Currency Incentives Added value: Taxes Anti-fra
Slide 16: Payment Provider Integration
The Bango Platform Key Accounts MNO: New app One channel to stores… multiple providers. Accounts Bango eases addition Key of new revenue Authentication Billing Settlement Refund Bango API streams. Bango API Payment Provider Integration Provider: One channel to many MNO. Bango eases Refund addition o
Slide 17: Bango business model
Bango business model 5¢ Bango Alternate: Agent Model net revenue 5¢ approx. 5% 100¢ 75¢ Bango 70¢ net revenue approx. 5% 100¢ 25¢ 70¢ End user 25¢ Biller Content buys $1 $1.00 fee Provider item gross revenue 25% earns 70% $1.00 Biller Content Provider gross fee earns 75% e.g. revenue 20% e.g. e.g. G
Slide 18: Notes on reporting period and turnover
Notes on reporting period and turnover • Reporting periods now 2011 2012 2013 align with calendar year. Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 (Change announced March 2012) FY2012 9m2012 FY2013 FY2012 1 Apr 2011 to 31 Mar 2012 9m2012 1 Apr 2012 to 31 Dec 2012 1h2012 2h2012 1h2013 FY2013 1 Jan 2013 to 3
Slide 19: 1h2013 Analysis of end user spend
1h2013 Analysis of end user spend 7 0.35 6 0.3 • Transition from feature phone to smartphone complete 5 0.25 4 0.2 • Legacy element <5% Spend Profit (9m2012 approx 33%). £m 3 0.15 £m 2 0.1 • End user spend £6.6m 1 0.05 74% up vs. £3.8m 2h2012 and 0 0 growing 1h2012 2h2012 1h2013 9m2012 6mths 6mths 6
Slide 20: 1h2013 Income statement
1h2013 Income statement 6 months 6 months 9 months • Increasing end user spend 1h2013 1h2012 9m2012 and significant growth in Unaudited Unaudited Audited £m £m platform fees £m End User Spend 6.60 5.19 5.99 • Gross profit up 78% to Turnover 4.54 5.67 7.35 £1.2m (1h2012: £0.7m) Cost of Revenue (3.35)
Slide 21: 1h2013 Operating loss
1h2013 Operating loss • EBITDA Loss £1.2m (1h2012: £1.0m, 9m2012: £1.7m) – Total Operating costs £2.37m (1h2012: £1.65m, 9m2012: £3.29m) • Managed increase in opex to secure, strengthen and scale operations and systems – Preparation for accelerating growth from key app stores – Leadership and staff
Slide 22: Balance sheet 30 June 2013
Balance sheet 30 June 2013 30-Jun-13 30-Jun-13 31-Dec-12 Unaudited Unaudited Audited £m £m £m ASSETS • Cash raised early Non-current assets Property, plant and equipment 0.85 0.28 0.64 2013 currently still Intangible assets 3.53 4.38 2.94 3.22 3.28 3.92 banked. Current assets Trade and other receiva
Slide 23: 1h2013 Cash flow statement
1h2013 Cash flow statement Six months Six months Nine months ended ended ended 30-Jun-13 30-Jun-12 31-Dec-12 Unaudited Unaudited Audited £m £m £m Net cash (used) / generated by operations (0.82) (1.38) (1.58) • Placement of £6.5m before expenses Cash flows generated from / (used by) investing activi
Slide 24: Post period highlights
Post period highlights • Progressing more Google Play projects • BlackBerry World grew to best ever month in August 2013 • Microsoft Windows Phone Store live with Indosat in Indonesia (NYSE:IIT) and Rogers in Canada in June 2013 • Key HTML5 advance with Mozilla - New ZTE devices launched August 2013
Slide 25: Building commercial momentum
Building commercial momentum Agreement with Firefox Marketplace Global Framework Agreement Telefónica Digital Live in: Spain 1st Google Play MNO live Colombia Poland Venezuela First Blackberry 50 operators July 2012 BB10 Launched Jan 2013 Facebook rollout UK USA Germany France Spain PayPass Wallet i
Slide 26: Emerging market opportunities
Emerging market opportunities • Brazil - New Telefónica relationship opening up LATAM - Mozilla / Firefox OS • India - BlackBerry, Google, Mozilla and Facebook opportunities - Bango business structure defined 1h2013 • Other Asia - BlackBerry BB10 opportunities - High Android uptake - MNO direct inte
Slide 27: Growth Strategy
Growth Strategy • Drive MNO integrations across more of our 5+ major app stores • Continue to seize opportunities presented by mobile content and new services in mobile devices • Expand product offering for “middle tail” to monetize products and services on mobile devices • Build on unique BangoID t
Slide 28: Outlook and opportunities
Outlook and opportunities • Established as leading mobile operator billing platform • Unique technology, extensive MNO relationships, industry-leading customers driving the market • More mobile operators x More content providers • Potential for additional growth from mobile operators partnering with