Endava Plc · NYSE:DAVA
Endava — Q2 FY2020 Earnings Presentation
22 slides from Endava's earnings presentation, Feb 13, 2020
Slide 1: Investor Presentation Q2 FY2020
INVESTOR PRESENTATION Q2 FY2020
Slide 2: Disclaimer
DISCLAIMER This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this presentation other than statements of historical facts, including, without limitations, statements regarding our future result
Slide 3: Large and fast growing market opportunity; deep industry expertise
LARGE AND FAST GROWING MARKET OPPORTUNITY DELIVER RAPID EVOLUTION BY STRONG GROWTH COMBINING NEXT-GEN AND FINANCIAL TECHNOLOGIES WITH FOUNDER-LED, EXPERIENCED PERFORMANCE DEEP INDUSTRY MANAGEMENT TEAM WITH EXPERTISE STRONG CULTURE IDEATION TO PRODUCTION CAPABILITIES, DISTRIBUTED AGILE AT SCALE, DOMA
Slide 4: We are a pure play next-gen technology company
ENGINEERING NEXT-GEN TECH ENTERPRISE AGILE WE ARE A PURE PLAY STRATEGY AUTOMATION NEXT-GEN TECHNOLOGY COMPANY USER EXPERIENCE TRADITIONAL CONSULTANTS IT SERVICES & AGENCIES 4
Slide 5: We serve a large addressable market
$796B 2023 % DIGITAL 15.3 TRANSFORMATION CAGR SERVICES* WE SERVE A LARGE ADDRESSABLE $451B * WORLDWIDE SEMIANNUAL DIGITAL 2019 TRANSFORMATION SPENDING GUIDE MARKET IDC OCTOBER 2019 5
Slide 6: Global staff and employee geography
GLOBAL STAFF 6,267 AS OF DECEMBER 31, 2019 CLOSE TO CLIENT NEARSHORE DELIVERY DENMARK, GERMANY, NETHERLANDS, EUROPEAN UNION: ROMANIA, BULGARIA; UNITED KINGDOM, UNITED STATES CENTRAL EUROPEAN COUNTRIES: NORTH MACEDONIA, MOLDOVA AND SERBIA; LATIN AMERICA: ARGENTINA, COLOMBIA, URUGUAY AND VENEZUELA Emp
Slide 7: History of Endava
CONCISE COMPUDAVA ALPHEUS NICKELFISH VELOCITY PARTNERS INTUITUS LTD UK MOLDOVA GERMANY USA USA & LATAM UNITED KINGDOM IT CONSULTANCY NEARSHORE CONSULTING DIGITAL, UX, & NA SALES & IT CONSULTANCY DELIVERY BUSINESS STRATEGY FIRM LATAM DELIVERY PRIVATE EQUITY PS TECH ISDC BAIN EXOZET GmbH SERBIA NETHER
Slide 8: We make our clients more agile, engaging, responsive and efficient
WE MAKE OUR CLIENTS MORE MORE & MORE ENGAGING RESPONSIVE EFFICIENT AGILE BUSINESS AUTOMATION DIGITAL CREATIVE INSIGHTS MOBILEDIGITAL DISTRIBUTEDSMART SOFTWARE TESTINGTEST CONTINUOUS APPLICATIONSADVANCED SERVICESMART STRATEGY THROUGH EXECUTION ARCHITECTURE AGILE DEV ENGINEERING AUTOMATIONSERVICES & C
Slide 9: Technology disruption waves and convergence
TODAY BANKING PAYMENTS HEALTHCARE RETAIL / CPG LOGISTICS TIME TECHNOLOGY DISRUPTION WAVES & CONVERGENCE 9
Slide 10: Domain expertise: payments
QUANTUM PROTOTYPING BIOMETRIC SCHEMELESS REAL OMNI-CHANNEL CRYPTOCURRENCY OPEN APIs CUSTOMER CENTRIC UX MICRO MERCHANTS SMART POS & NANO PAYMENTS SYSTEMS PSD2 FRICTIONLESS ROBOTIC IN APP P2P PAYMENTS AUTOMATION ROI OPPORTUNITY MESSAGE BLOCKCHAIN PAYMENTS APPS CHATBOTS PLATFORMS FINANCIAL INCLUSION 2
Slide 11: Scalability, brand, culture and M&A
SCALABILITY BRAND CULTURE M&A AS WE STRIVE TO BE THE TO SUPPORT THIS GROWTH, WE WE USE TUCK-IN ACQUISITIONS TO ASPIRATIONAL BRAND FOR IT NEED LEADERSHIP AND HAVE ACCELERATE OUR GROWTH PROFESSIONALS IN THE DEVELOPED THE ‘PASS IT ON’ STRATEGY - TO EITHER ESTABLISH REGIONS IN WHICH WE INITIATIVE WHICH
Slide 12: Financials
FINANCIALS 12
Slide 13: Financial highlights
FINANCIAL HIGHLIGHTS MASTER SERVICE AGREEMENTS WITH CLIENTS PRIMARILY T&M BASED PRICING LONG-TERM CLIENT RELATIONSHIPS STRONG REVENUE GROWTH HEALTHY MARGINS LOW CAPEX REQUIREMENTS POSITIVE ADJUSTED FREE CASH FLOW 13
Slide 14: Strong revenue growth
REVENUE (£m) CAGR 36% +22% YOY 168.3 138.2 85.9 71.8 Q2 84.1 115.4 159.4 217.6 287.9 66.4 82.4 Q1 FY15 FY16 FY17 FY17 FY19 _ 6m18 6m19 FY15 FY16 FY17 FY18 FY19 6M19 6M20 JUNE 30 DECEMBER 31 OVER LAST 5 YEARS, 88.8% OF REVENUE (ON AVERAGE) EACH FISCAL YEAR WAS GENERATED FROM CLIENTS IN THE PREVIOUS Y
Slide 15: Robust profitability
PROFIT BEFORE TAX (£m) ADJUSTED PROFIT BEFORE TAX (£m)* 0.2 CAGR 34% 17.5 12.0 37.4 25.2 9.4 15.2 20.8 21.7 24.6 30.1 2.6 Q1 20.5 FY15 FY16 FY17 FY18 FY19 _ FY17 FY18 Q2 17.3 13.5 16.1 22.8 25.2 33.5 51.9 11.7 16.9 Q1 FY15 FY16 FY17 FY18 FY19 _ FY17 FY18 Q2 FY15 FY16 FY17 FY18 FY19 6M19 6M20 FY15 FY
Slide 16: Deep client relationships
TOP CLIENT REVENUE % TOP TEN No. OF CLIENTS / REVENUE > £1m* 66% 54% 49% 42% 38% 38% 39% 38% 37% 66% 54% 49% 42% 38% 38% 39% 38% 37% 18 26 34 46 63 60 65 FY15 FY16 FY17 FY17 FY17 6M19 6M20 q218 q219 FY15 FY16 FY17 FY18 FY19 6M19 6M20 Q2FY19 Q2FY20 FY15FY15 FY16 FY17FY17 FY18 FY18FY19 FY17Q2FY19 Q2FY
Slide 17: Increasing number and spend of clients
AVERAGE SPEND: AVERAGE SPEND: TOTAL No. OF CLIENTS TOP 10 CLIENTS (£000s) REMAINING CLIENTS (£000s)* 11000 8250 5500 2750 112 154 188 258 275 271 367 5,510 6,200 7,820 9,040 10,870 5,246 6,510 2,730 3,190 284 434 504 597 699 456 440 263 258 0 FY15 FY16 FY17 FY17 FY17 _ FY17 FY18 FY15 FY16 FY17 FY18
Slide 18: Diverse revenue base: geography and industry verticals
RoW N.AMERICA EUROPE UK REVENUE % BY REGION 3% 0.3 23% 10% 18% 16% 12% 21% 27% 27% 29% 18% 24% Q2 FY20 34% 34% 28% 28% 23% REVENUE % BY VERTICAL 53% 78% 64% 50% 45% 45% 45% 45% FY15 FY16 FY17 FY18 FY19 _ FY19 FY20 PAYMENTS AND FINANCIAL SERVICES FY15 FY16 FY17 FY18 FY19 Q2FY19 Q2FY20 TECHNOLOGY, MED
Slide 19: Low capex and positive adjusted FCF
CAPITAL EXPENDITURES (£m) ADJUSTED FREE CASH FLOW (£m)* 30.00 5.7 21.5 20.00 8.0 3.9 Q2 9.5 3.2 Q2 10.00 2.0 9.2 2.1 2.7 6.5 5.4 7.3 1.9 2.5 9.5 10.1 11.2 28.7 29.8 0.30.3 13.5 Q1 0.00 Q1 FY15 FY16 FY17 FY18 FY18 _ FY17 FY18 FY15FY15 FY16 FY17FY17 FY18 FY18FY19 FY176M19 6M20 FY15 FY16 FY17 FY18 FY19
Slide 20: Appendix
APPENDIX 20
Slide 21: IFRS to non-IFRS reconciliation
IFRS TO NON-IFRS RECONCILIATION 21
Slide 22: Endava
Fendava 22