Connexion Mobility Ltd · ASX:CXZ
Connexion Mobility — Shareholder Meeting (November 2023)
25 slides from Connexion Mobility's shareholder meeting presentation, November 2023
Slide 1: Mobility Platform 2023 Annual General Meeting
Mobility Platform 2023 Annual General Meeting
Slide 2: Agenda
Agenda 1 Introduction GROUP AGM PRESENTATION NOVEM BER 2 023 2 Industry 3 Product & Growth 4 FY23 Results 5 Outlook 6 Q&A 2
Slide 3: Introduction
Introduction Connexion Telematics is an enterprise-grade software company servicing the US automotive industry. Our proprietary OnTRAC and Connexion platforms incorporate telemetry, fleet management, contract management, data analytics, and more, to deliver mobility solutions to OEMs and dealerships
Slide 4: What Do We Do?
Connexion helps OEMs and Dealerships to move people, parts and vehicles. What Do We Do? Starting with courtesy transportation, our customers enjoy: • A single platform, from which they can manage all modes of ground transport • Quick reservations and DMS integration, reducing time to rent out vehicl
Slide 5: Customer Landscape
Customer Landscape • Fleet Owners mostly operate a variety of commercial fleets • Connexion focuses on a specific type of fleet owner, being the Franchised Automotive Dealership (franchisee), along with the Manufacturer (franchisor) • The US is home to circa 17,000 franchised dealerships OEM Group U
Slide 6: Navigating Industry Trends
Navigating Industry Trends The Connexion to the Future Connexion partners with OEMs and Dealerships to maximise the utilisation of their assets, the profitability of their business units, and to elevate the end-customer experience. This combination is only possible through Connexion’s harnessing of
Slide 7: Product Strategy
Product Strategy One Platform, Moving People, Parts, and Vehicles 7
Slide 8: Product Strategy
In Development Product Strategy Future Development Connexion Platform Marketplace B2B Core Product Newly Launched Product 3 Sub-1 Sub-2 Sub-1 Sub-2 Consumer B2C Mobility Multi-Year Endeavour, Higher Risk 8
Slide 9: Sources of Growth
Sources of Growth GM Direct-to-Dealer New OEMs & Dealers 1. Deepening work with GM’s CTP Team 3. Delivering proprietary and 3rd party 4. Selling the Connexion Platform directly to solutions directly to Dealerships new OEMs and Dealer Groups 2. Adding value to other teams within GM 9
Slide 10: FY23 Results
FY23 Results 10
Slide 11: FY23 Operational Performance
FY23 Operational Performance Positives Negatives Lessons & Next Steps 1. Significantly expanded team with minimal productivity 1. Trailing internal targets for OEM and Dealer expansion 1. Sales & Marketing efforts highlighted the need for disruption greater product differentiation 2. Navigated sever
Slide 12: Key Trends
Key Trends Financially, four key trends drove our FY23 results: 1. Revenue growth from larger new vehicle inventories 2. Revenue growth from Connexion subscriptions 3. Revenue growth from feature delivery 4. Expenditure growth from reinvestment into our Team and Products 12
Slide 13: FY23 Highlights
FY23 Highlights Revenue Cash and Liquid Investments $7,000,000 $4,000,000 $6,000,000 $3,500,000 $3,000,000 $5,000,000 $2,500,000 $4,000,000 $2,000,000 $3,000,000 $1,500,000 $2,000,000 $1,000,000 $1,000,000 $500,000 Our P&L exhibits a high degree of operating $- $- leverage typical of a SaaS company
Slide 14: Net Profit Before Tax
Net Profit Before Tax Annual Profit before Tax $4,000,000 FY22 - FY23 $3,500,000 +380k +81k $3,000,000 -100k +2,306k +461k 2,596k $2,500,000 -420k -261k $2,000,000 -313k $1,500,000 $1,000,000 410k +52k $500,000 $- FY22 Subscription Subscription Fixed-dollar SaaS Service Revenue Cost of Sales Researc
Slide 15: DMEPS and Gross Profit
DMEPS and Gross Profit 0.50 DMEPS (USD cents) 0.45 0.40 0.35 0.30 0.25 0.20 0.15 As announced to the ASX on 16 October 2023, 0.10 Management will now present Diluted Maintainable 0.05 Earnings Per Share (‘DMEPS’) as a core metric. - FY22 FY23 To best measure return on investment over time, we track
Slide 16: True SaaS
Revenue Split True SaaS 100% 90% 10% 12% 13% 17% 8% 10% 10% 8% 8% 80% 70% 60% 50% 90% 92% 90% 90% 92% 92% 88% 87% 40% 83% 30% Connexion’s prime focus continues to be growing 20% its scalable, “true SaaS” business. 10% 0% This focus is reflected in the high percentage of Q1 FY22 Q2 FY22 Q3 FY22 Q4 FY
Slide 17: Investment Initiatives
Investment Initiatives Growth Spend Connexion is consistently increasing its investment $1,000,000 45% into both R&D and Sales & Marketing, whilst closely $900,000 40% monitoring the return on such spend. $800,000 35% Complementing the previously mentioned DMEPS $700,000 30% metric, is Return on Gro
Slide 18: Capital Management
Capital Management • Long-term Shareholder value is a function of: 1. Operational Management 2. Capital Management • Capital can be allocated to product-based and/or share-based investments. • A strong balance sheet can enable meaningful allocation to both. • Reliable “return on investment” attribut
Slide 19: Economic Drivers
Economic Drivers Team Performance At last year’s AGM, we presented the three Economic Drivers affecting Connexion’s financial Subscriptions performance, in order of influence. Throughout FY23, the order did not change. FX 19
Slide 20: Economic Drivers: Team Performance
Economic Drivers Team performance remains strong: 1. Significant team expansion with minimal productivity disruption. Team expansion of 40%, with new hires primarily technical in nature and performing well shortly after onboarding. 2. Navigating the global challenges of severe wage inflation ahead o
Slide 21: Economic Drivers: Subscriptions
Economic Drivers Subscription gross margin increased materially: 1. Significant growth in subscriptions to the Connexion Platform from H2 FY23. The Connexion Platform is priced on a per dealership basis. 2. New vehicle inventory continued to stabilize following the severe impact of the semiconductor
Slide 22: Economic Drivers: FX
Economic Drivers Movement from FX sensitivity was relatively low through FY23: 1. Continued application of Connexion’s FX Policy performed to expectation. 2. The policy includes a natural hedge of currency-matching assets and operating expenditure to the extent of available free cash FX (i.e. conver
Slide 23: Summary
Summary 2 0 23 AG M AGM PRESENTATION • Sixth consecutive profitable year, with record net cash and investments on balance sheet NOVEM BER 2 023 • A modest recovery of dealership vehicle inventories continued throughout FY23 • All-time high gross profitability reached in the final quarter of FY23 • H
Slide 24: Outlook
Outlook We believe Connexion’s outlook to be positive for the following reasons: From our observations, dealerships are increasingly adopting software to: 1. Improve the customer experience 2. Drive operational efficiency 3. Reduce risk Connexion’s software: 1. Delivers on each of the above, today 2
Slide 25: Shareholder Q&A
Mobility Platform Shareholder Q&A
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