Etherstack Plc · ASX:ESK
Etherstack — Rapid Insights Investor conference (November 2022)
36 slides from Etherstack's conference presentation, Nov 17, 2022
Slide 1: Etherstack Corporate Presentation to Rapid Insights Investor conference
For personal use only Etherstack Corporate Presentation to Rapid Insights Investor conference Etherstack plc (ASX:ESK) 17 November 2022 Authorised for release by David Deacon, CEO and David Carter, CFO
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by Etherstack plc (ARBN 156 640 532) (“Etherstack” or “the Company”). The information in this presentation is for For personal use only information purposes only and is not investment, financial product, legal or tax advice. This presentation contains s
Slide 3: Corporate Presentation Contents
Corporate Presentation Contents: For personal use only Part 1 – 2022 + Highlights Part 2 – Business Overview
Slide 4: Part 1 - 2022 Highlights
For personal use only Part 1 -2022 + Highlights
Slide 5: Etherstack
Etherstack A wireless technology provider that supplies mission critical wireless networks to the public safety, utilities and For personal use only resource sector. Licenses key technology to over 20 other wireless equipment manufacturers globally 3 Core Businesses (diversified revenue mix) ▪ Digit
Slide 6: Etherstack investment fundamentals
Etherstack investment fundamentals Continued growth in LMR networks. Cellular networks adding material value now and into the future. Satellite For personal use only networks likely to deliver subsequent and future value Leveraged to Government Established global Targeted Growth: Samsung, and indust
Slide 7: 2022 Half year Financial highlights
2022 Half year Financial highlights For personal use only 13% 53% US $1.64m Net Profit after tax Revenue growth over EBITDA growth over 107% increase over H1 2021 US$4.86 m H1 2021 to US$2.22 m H1 2021 NPAT Recurring revenue growth Delivery Product AUD $1.8 m Development “Land and expand” Milestones
Slide 8: 2022 Business highlights
2022 Business highlights For personal use only Revised Samsung Signed Nokia MCX A $1.7 m Follow on Teaming Agreement IWF agreement Defence Contract • 5 further years • New pilot project • $1 million Dec 20 Australian • AUD $750,000 revenue Defence contract prepayment for • Demand proven extended sec
Slide 9: Digital LMR (Land Mobile Radio) Network Solution
Digital LMR (Land Mobile Radio) Network Solution Supplying digital LMR) networks to emergency services, utilities, resource and security agencies in the US, For personal use only Canada and Australia Etherstack Recurring Revenue (USD ‘000) Network Deliveries ▪ Very high margin sales on Etherstack’s
Slide 10: 4G/5G Carrier Network Solution – 3GPP LMR-IWF
4G/5G Carrier Network Solution – 3GPP LMR-IWF (InterWorking Function) Etherstack has the world’s first 3GPP standards based LMR-IWF, a telco carrier software solution to bridge For personal use only 4G/5G networks with First Responder networks Solution Overview ▪ Gateway softswitch between carrier c
Slide 11: Strong outlook driven by focus on key strategic initiatives
Strong outlook driven by focus on key strategic initiatives For personal use only “Land and Expand” Commencement Expansion of of upgrades to existing Australian virtualised & International switching solutions public safety across installed networks base Cellular Satellite Networks LMR Networks Defen
Slide 12: Part 2 - Business Overview
For personal use only Part 2 - Business Overview
Slide 13: A leading licensor of innovative wireless technology for mission-critical communications
A leading licensor of innovative wireless technology for mission-critical communications For personal use only Etherstack enables push-to-talk (PTT) communications for essential services, within and across advanced digital land mobile radio (LMR), cellular and satellite networks Globally diversified
Slide 14: Our Three Core Markets
Our Three Core Markets For personal use only PTT Technology Mission Critical Push to Digital Land Mobile Satellite Push to Talk Talk (MCPTX) over cellular Radio (LMR) networks (PTT) networks networks (4G & 5G) Digital wireless terrestrial communication Mission Critical Push to Talk (MCPTX) over Deve
Slide 15: Key Developments Timeline
Key Developments Timeline For personal use only January - June July - December Jan - May June – November 2021 2021 2022 2022 11 February 28 February 20 June EOS Defence Systems 22 July Previously announced Follow on Resources subcontract (A$500,000) First contract under Samsung Samsung contract – te
Slide 16: Digital land mobile radio (LMR) networks
For personal use only Digital land mobile radio (LMR) networks
Slide 17: Digital LMR Networks
Digital LMR Networks Digital Land Mobile Radio (LMR) Networks Etherstack has deep experience delivering software based digital land mobile radio networks across public For personal use only safety, utilities, resources and transportation industries Public safety A globally diversified base of high q
Slide 18: A significant US$3.0b market opportunity exists for growth in target contracts
Digital LMR Networks A significant US$3.0b market opportunity exists for growth in target contracts Developed a complete range of LMR technology for public safety & mission critical voice communication For personal use only systems Scores of target sized Etherstack target $3.0b Etherstack target con
Slide 19: Cellular Networks (4G & 5G)
For personal use only Cellular Networks (4G & 5G ) (Mission Critical Push to Talk over LTE)
Slide 20: Evolving public safety communications – hybrid networks
Cellular networks (4G & 5G) Evolving public safety communications – hybrid networks Etherstack’s software enables interoperability between traditional digital New wireless technologies (wifi, 4G & 5G) is For personal use only radio networks and new 4G & 5G networks for public safety transforming pub
Slide 21: A large and growing US$250–750m market opportunity
Cellular networks (4G & 5G) A large and growing US$250 – 750m market opportunity For personal use only Contracts available for Upfront licensing Long term recurring competition fee potential revenue stream 60 - 90 US$2 – 8m High Margins In OECD countries over ~5 years1 per contract comparable to ent
Slide 22: Etherstack leveraging LMR transition to 4G/5G Core Market
Cellular networks (4G & 5G) Etherstack leveraging LMR transition to 4G/5G Core Market Etherstack leveraging Public Safety agency transition to 4G/5G Core Market with direct contract awards with For personal use only Samsung and AT&T in the US to develop and deliver new product for this pipeline ▪ De
Slide 23: Satellite Networks
For personal use only Satellite Networks
Slide 24: Secure Push To Talk Communications over Satellite
Secure Push To Talk Communications over Satellite For personal use only Etherstack is ready to capitalise on emerging wireless communications opportunities made available by new low-cost satellite technology Falling satellite tariff costs the catalyst for change in the communications sector US$56.0b
Slide 25: Financial highlights FY 2021 + HY 2022
For personal use only Financial highlights FY 2021 + HY 2022
Slide 26: 2021 Full Year Financial highlights
2021 Full Year Financial highlights For personal use only 81% 142% Strong YOY Revenue growth YOY EBITDA growth to US$2.6m Balance sheet with to US$8.50m no external debt Recurring revenue growth $1.45m 12% $3.36m $1.37m increase over YOY Increase in recurring FY21 operating cash flow. An 2020 underl
Slide 27: Solid pipeline of contract wins driving growth
Solid pipeline of contract wins driving growth For personal use only First Carrier contract - Strategic contracts Samsung for MCPTX • US$8.5m contract covering licences, integration & initial 3 years • Initial direct AT&T contract win of support • Substantial delivery on the December 2020 announced
Slide 28: Strong performance and growth driven by key contract wins
Strong performance and growth driven by key contract wins For personal use only Revenue & EBITDA (USD ‘000) Multiple growth drivers have delivered strong revenue growth in FY21 and HY 22 $8,504 81% growth over FY2020 to FY 2022 US$8.5m followed by a 13% increase Half year for HY22 over HY 21 $5,264
Slide 29: Recurring revenue remains a core focus for Etherstack
Recurring revenue remains a core focus for Etherstack For personal use only Etherstack Recurring Revenue (USD ‘000) Recurring Support Revenues grow over the medium and long term 2,331 2,277 • 12% increase in FY 2021 to $1,776 • 7% decrease in HY 2022 predominantly due 743 500 to currency headwinds 1
Slide 30: Income Statement
Income Statement For personal use only US$'000 2018 2019 2020 2021 HY2022 Revenue increases driving EBITDA growth Revenue from Contract with 5,264 4,792 4,699 8,504 4,857 Customers ▪ 142% EBITDA growth FY 2021 vs Recurring support and Royalty FY20 1,682 1,838 2,331 2,277 1,042 revenue Project and Pr
Slide 31: Growth strategy
For personal use only Growth strategy
Slide 32: Balance Sheet & Cash Flow Statement
Balance Sheet & Cash Flow Statement Balance Sheet Cash Flow Statement For personal use only US$’000 31-Dec-20 31-Dec-21 30-Jun-22 US$’000 2020 2021 2022 HY Cash and cash equivalents 4,180 3,038 571 Net cash generated from 1,733 3,368 (880) operating activities Trade and other receivables 1,410 2,439
Slide 33: "Land and expand" case studies
“Land and expand” case studies For personal use only WA Resources Electric Utilities • Initial order May 2020 • 3 US utilities within the First Energy group • New order A$1m in May 2022 • ATCO – Alberta, Canada • Aggregate orders over A$2.3 million • Ergon/Energex – Qld, Australia Royal Canadian Mou
Slide 34: Sustained growth in LMR Core Network via key customer wins
Sustained growth in LMR Core Network via key customer wins Currently targeting network contracts valued between US$0.5 – 20m in upfront revenues, historically winning 1-2 For personal use only customer LMR networks per year 2022 January – June July –2023 December 2024 January – June July –2025 Decem
Slide 35: Samsung global teaming partnership and Nokia contract drives additional growth
Samsung global teaming partnership and Nokia contract drives additional growth For personal use only Etherstack is targeting more than 25 contract wins over the medium term MCPTX market is rapidly developing for the lead telco carriers in major OECD economies • Contract lead times are presently long
Slide 36: For personal use only
London New York 64 Rose Street, +44 207 734 0200 +1 917 661 4110 Chippendale NSW 2008 For personal use only info.eu@etherstack.com info.na@etherstack.com Phone +61 2 8399 7500 Sydney Yokohama David Deacon, CEO +61 2 8399 7500 +81 45 342 9050 david.deacon@etherstack.com info.au@etherstack.com info.jp
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