Slide 1: FY21 Investor Presentation
19 August 2021 FY21 Investor Presentation Attached is a copy of the IPH Limited FY21 Investor Presentation. An analyst/shareholder briefing will be held at 10.30am (AEST). The briefing will be webcast and accessible on the IPH website at www.iphltd.com.au. For more information, please contact: Marti
Slide 2: 2021 Full Year Results Investor Presentation
2021 Full Year Results Investor Presentation Full year ended 30 June 2021 Thursday, 19 August 2021 Presented by: Dr. Andrew Blattman Managing Director & CEO, IPH Limited John Wadley Chief Financial Officer, IPH Limited iphltd.com.au
Slide 3: Disclaimer
Disclaimer This document has been prepared by IPH Limited (IPH) and comprises written materials/slides for a presentation concerning IPH. This presentation is for information purposes only and does not constitute or form part of any offer or invitation to acquire, sell or otherwise dispose of, or is
Slide 4: Contents
Contents 1 FY21 highlights 5 2 FY21 results 7 3 Market update 14 4 Delivering on our strategy 19 5 Summary and key priorities for FY22 27 6 Appendix 31 www.iphltd.com.au 2021 Full Year Results Investor Presentation 3
Slide 5: About the IPH Group
About the IPH Group Asia-Pacific’s leading IP professional services group 1) Approximate employee numbers across the Group. 2) IPH Management estimate based on patent filing data: Australia (IP Australia) – FY21 as at 13/07/21; Singapore (IPOS) – CY21 YTD Jun (preliminary) as at 5/08/21; New Zealand
Slide 6: FY21 highlights
01 FY21 highlights www.iphltd.com.au 2021 Full Year Results Investor Presentation 5
Slide 7: Strong results across key metrics
Strong results across key metrics Performance demonstrates the success of acquisitions and the power of the IPH network Underlying EBITDA1 $124.3m 1% Like for like EBITDA2 10% Referrals from acquired companies into IPH Asia business3 25% Legacy Xenith EBITDA margin improvement4 39% Full year dividen
Slide 8: FY21 results
02 FY21 results www.iphltd.com.au 2021 Full Year Results Investor Presentation 7
Slide 9: Financial overview
Financial overview Currency headwinds of 11% impact reported results 2% 3% Revenue Final Dividend1 $363.5m 15.5 cents per share (40% franked) EBITDA $113.3m Underlying EBITDA2 $124.3m 1% Statutory NPAT $53.6m 2% Underlying NPAT2 $76.2m 2% 4% 4% Diluted EPS Underlying Diluted EPS 24.7 cents per share
Slide 10: Double digit earnings growth on like-for-like basis
Double digit earnings growth on like-for-like basis Solid Asian performance and acquisition synergies drive strong earnings result Australia – New Zealand Asia Group Revenue 3% Revenue 3% Revenue 2% EBITDA 7% EBITDA 8% EBITDA 10% EBITDA margin 11% EBITDA margin 5% EBITDA margin 12% 1) Like for like
Slide 11: Underlying Results
Underlying Results Underlying EBITDA $124.3m despite 11% increase in A$/US$ average exchange rate in FY21 FY21 Statutory Underlying FY20 Statutory Underlying Adjustments Adjustments Income Statement Earnings FY212 Income Statement Earnings FY20 Total revenue 363.5 363.5 370.1 (0.5) 369.6 Recoverable
Slide 12: Cash flow statement
Cash flow statement FY21 Cash Flow Statement FY20 Cash Flow Statement IPH continues to generate excellent cashflow #039;m with cash conversion of 100% Statutory EBITDA 113.3 113.2 Non-cash movements • Cash conversion of 100% reflects strong collections despite economic environment Change in working cap
Slide 13: Balance sheet
Balance Sheet as at 30 Jun 2021 Balance Sheet as at 30 Jun 2020 Balance sheet #039;m Cash and cash equivalents 71.2 82.9 Maintaining strong financial position Trade and other receivables 83.4 89.1 Other current assets 10.3 9.1 Total current assets 164.9 181.1 • Cash movement includes debt repayment ($3
Slide 14: Foreign currency sensitivity
Foreign currency sensitivity Earnings currency Balance sheet Operating expenses Service Charges sensitivity sensitivity • Based on the USD profile in FY21 in • The Group is also exposed to FX on Other the IPH Group, a 1c movement in the level of its USD denominated NZD SGD 7% the AUD/USD exchange ra
Slide 15: Market update
04 Market update www.iphltd.com.au 2021 Full Year Results Investor Presentation 14
Slide 16: Patent market – Australia
Patent market – Australia Australian filings improved in second half with #1 market share position maintained 45 .0 % Australian patent IPH Group market share 45 ,0 00.00 42,034 filings – market1 40 ,0 00.00 (excluding innovation patents)2 40 .0 % 36,415 36,310 36,628 36,408 38.1% • IPH Group's fili
Slide 17: Patent market – Singapore
Patent market – Singapore Strengthened #1 position – increasing market share 30 .0 % Singapore patent IPH Group 16,00 0 filings – market1 14,00 0 14,028 13,117 market share2 25.9% 25 .0 % 24.5% • Latest CY20 data shows Singapore • Based on preliminary data for 1H 23.3% 11,611 23.0% 23.0% patent mark
Slide 18: IPH patent filings – Asia
IPH patent filings – Asia1 10.3% CAGR growth for China2 10 00 • FY21 compares against a strong FY20 due to significant filings from one client across multiple jurisdictions. 90 0 (8.7%) (10.6%) • Removing the effect of this one client, 80 0 we have seen total growth across these key jurisdictions of
Slide 19: Trade mark market – Australia
Trade mark market – Australia Maintained #1 position in a changing market – IPH filings up 80,00 0 30 .0 % Australian trade mark IPH Group filings – market (excl. 70,00 0 69,242 market share3 63,537 Int’l Registrations)1 25 .0 % 60,00 0 58,156 58,319 58,734 • IPH trade mark filings in Australia (exc
Slide 20: Delivering on our strategy
03 Delivering on our strategy www.iphltd.com.au 2021 Full Year Results Investor Presentation 19
Slide 21: Strategic direction
Strategic direction Focus on IPH’s growth strategy Organic growth Consolidate acquisitions Growth step-outs Robust client management Expand service Focus on our programs focused on offering to existing Enablers delivering the highest Targeted expansion across Asia-Pacific people – attract, motivate
Slide 22: Organic Growth
Organic Growth Leveraging our leading network across the region with client referrals up 25% • Strengthened number 1 patent filer position in Singapore and grew market share to 25.9%. CY21 filings up 16.8%. • IPH patent filings in Hong Kong SAR up 10% and in China up 12.4% in FY21. • Continued incre
Slide 23: Consolidating Acquisitions
Consolidating Acquisitions Significantly improved financial performance in merged Griffith Hack Transformation of legacy Xenith IP group Based on figures for XIP last financial Synergies delivered year (FY19) adjusted for AASB16 lease accounting, margin has improved by • Delivered previously announc
Slide 24: Growth step-outs
Growth step-outs Acquisition and integration of Baldwins IP with AJ Park • AJ Park acquires Baldwins IP in October 2020 • Full physical and systems integration of Baldwins IP achieved in December 2020 Synergies delivered • Synergies achieved through rental and right-sizing of business • Delivered pr
Slide 25: Growth step-outs and enablers
Growth step-outs and enablers Expanding digital and trade mark capability with acquisition of Applied Marks Reaching new markets • Retail focus gives group access to an expanded market • Evolves traditional trade mark services in line with the changing market • Is expected to extend into other IPH j
Slide 26: Enablers – our people
Enablers – our people Strengthening the talent pipeline Building group-wide Building our leadership capability people capability and talent opportunities • Group-wide People function introduced Q2 FY21 and now • Record year for promotions with 35 – 11 people to Principal operational across Asia-Paci
Slide 27: Ongoing commitment to sustainability
Ongoing commitment to sustainability IPH recognises that sustainable business is good business with solid progress achieved in FY21 Our People Diversity Governance & • 35 promotions across member firms • Women represent 33% of Senior Executive Risk management (including 11 Principal promotions) and
Slide 28: Summary and key priorities for FY22
06 Summary and key priorities for FY22 www.iphltd.com.au 2021 Full Year Results Investor Presentation 27
Slide 29: Summary and Priorities for 2022
Summary and Priorities for 2022 IPH has built a strong platform for future growth • Demonstrated ability to acquire and integrate businesses to deliver margin accretion and earnings growth • Focus on organic growth, leverage IPH Group network for increased client referrals, target new business oppor
Slide 30: Q&A
Q&A www.iphltd.com.au 2021 Full Year Results Investor Presentation 29
Slide 31: Thank you
Thank you iphltd.com.au www.iphltd.com.au
Slide 32: Appendix
06 Appendix www.iphltd.com.au 2021 Full Year Results Investor Presentation 31
Slide 33: Like for Like Revenue and EBITDA
Like for Like Revenue and EBITDA 10% increase in like for like EBITDA from strong organic growth in Asia and synergies in Australia/NZ Underlying New Accounting Currency Adjusted Underlying Chg% Revenue Jun 21 Businesses2 FX Movements3 Adjustment4 Revenue Jun 21 Revenue Jun 20 Australia & NZ IP 275.
Slide 34: Patent market trends
Patent market trends No discernible impact to long-term trends Australian Patent Filings1 CAGR (FY06 to FY21) = 1.6% US PCT Applications2 CAGR (CY05 to CY20) = 1.5% CAGR Post-GFC (CY10 to CY20) = 2.7% CAGR Post-GFC (FY10 to FY21) = 2.6% 70 ,0 00.00 45 ,0 00 60 ,0 00.00 50 ,0 00.00 40 ,0 00 40 ,0 00.
Slide 35: Revenue and EBITDA
Revenue and EBITDA Underlying Revenue $’m Underlying EBITDA $’m Australia IP Asia IP New Businesses Data & Analytics Serv Corp & Interco Australia IP Asia IP New Businesses Data & Analytics Serv Corp & Interco 124.3 369.4 363.5 114.5 2.7 0.4 5.1 22.5 17.8 89.7 256.6 110.4 43.4 96.1 71.7 74.0 2.4 226
Slide 36: Patent lifecycle
Patent lifecycle Long-life cycle supports consistent revenues and earnings Each year more than half+ of the total patent applications filed in Australia Typical (indicative) foreign patent route in Australia come through the PCT system in the form of PCT National Phase patent applications. • The pro