Netsol Technologies Inc. · NASDAQ:NTWK
Netsol Technologies — Q3 2007 Earnings Presentation
24 slides from Netsol Technologies's earnings presentation, May 8, 2007
Slide 1: Q3 2007 Financial Results Presentation
Q3 2007 Financial Results Presentation Najeeb U. Ghauri Chairman & Chief Executive Officer Tina Gilger Chief Financial Officer
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation may contain forward-looking statements relating to the development of NetSol Technologies’ products and services and future operation results, including statements regarding the Company that are subject to certain risks and uncertainties that could cause actua
Slide 3: Najeeb U. Ghauri
Najeeb U. Ghauri Chairman & Chief Executive Officer SLIDE 2
Slide 4: Consolidated Financial Highlights
Consolidated Financial Highlights Q3 2007 Highlights = Revenues increased 51% to $7.6 million - Driven by strength in the Asia-Pacific division, which signed several significant new multi-million dollar contracts for LeaseSoft with global, blue chip brand names in the captive finance sector = Operat
Slide 5: Q3 Business Highlights — Asia Pacific
Q3 Business Highlights — Asia Pacific = Gained market share - Signed several new multi-million dollar contracts for LeaseSoft, our flagship vehicle portfolio management system, particularly in the China market, which is now the #1 revenue-generating marketing for NetSol = Expanded e-Government work
Slide 6: Looking Ahead — Asia Pacific
Looking Ahead — Asia Pacific = LeaseSoft sales pipeline remains strong - Continuing to expand pipeline of opportunities in China, Australia, Thailand and New Zealand - Penetrating new target verticals, such as Fleet Management = e-Government projects in Pakistan on track and opportunities expanding
Slide 7: Q3 Business Highlights — EMEA
Q3 = Further penetrated market in Europe =Im Business Highlights — EMEA Awarded contract from leading European bank to design a new business partner portal for its insurance premium finance division proved market position in the Middle East Signed Memorandum of Understanding (MOU), valued in excess
Slide 8: Looking Ahead — EMEA
Looking Ahead — EMEA = Continue to expand market and product reach - Good sales pipeline for Evolve, the entry-level Asset Finance solution for less than 2,500 agreements - Strong interest in LeaseSoft end-to-end processing solutions, origination to contract management - Anticipate further penetrati
Slide 9: Q3 Business Highlights — North America
Q3 Business Highlights — North America = Integration of US Operations is on track and progressing well - Leveraging offshore resources, improving internal resource utilization and marketing NetSol products in the US market = Further developed sales pipeline - Penetrated potential customer opportunit
Slide 10: Looking Ahead — North America
Looking Ahead — North America = Accelerate the integration process - Finalize infrastructure changes and plans - Further leverage offshore development team in Lahore = Expand market and product reach - Further penetrate potential customer opportunities and close as many deals in quarter as possible
Slide 11: Strong Annual Revenue Growth
Strong Annual Revenue Growth $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $ 10,000,000 $5,000,000 $0 FYE 6/30/03 FYE 6/30/04 FYE 6/30/05 SLIDE 10 FYE 6/30/06 FYE 6/30/07 E
Slide 12: Tina Gilger
Tina Gilger Chief Financial Officer SLIDE 11
Slide 13: Revenues
Revenues License Fees Maintenance Fees Services Total Revenues (Unaudited) All numbers in thousands 3-Months Ended 9-Months Ended March 31, March 31, 2007 2006 2007 2006 $ 2,554 $ 1,790 $ 6,852 $ 3,952 1,336 621 3,990 1,709 3,726 2,635 9,864 8,379 $ 7,616 $ 5,046 $ 20,706 $ 14,040 SLIDE 12
Slide 14: Q3 2007 Revenue Mix
Q3 2007 ISP Provider, 3% IT Consulting Services 46% Maintenance Fees 18% SLIDE 13
Slide 15: Cost of Sales
Cost of Sales (Unaudited) All numbers in thousands 3-Months Ended 9-Months Ended March 31, March 31, 2007 2006 2007 2006 Salaries & consultants $ 2,235 $1,611 $ 6,609 $ 4,098 Travel 447 189 1,195 429 Communication 33 31 114 83 Depreciation & amortization 241 216 592 494 Other 966 272 1,899 859 TOTAL
Slide 16: Quarterly Margin Trend
70% 60% 7 50% 7 40% 7 30% 7 20% 7 10% 4 0% + HAT 4Q 2005 1Q 2006 2Q 2006 3Q 2006 4Q 2006 1Q 2007 2Q 2007 3Q 2007 SLIDE 15
Slide 17: Net Income (Loss) Per Share (diluted)
Net Income (Loss) Per Share (diluted) $0.05 + $0.00 ($0.05)+ ($0.10)+ ($0.15)+ ($0.20)+ ($0.25)+ ($0.30) 4Q 2005 1Q 2006 2Q 2006 3Q 2006 4Q 2006 1Q 2007 2Q 2007 3Q 2007 SLIDE 16
Slide 18: EBITDA Per Share
$0.08 $0.06 $0.04 $0.02 $0.00 4Q 2005 1Q 2006 2Q 2006 3Q 2006 4Q 2006 1Q 2007 2Q 2007 3Q 2007 SLIDE 17 ES
Slide 19: Income Statement Highlights
Income Statement High housands PERIOD ENDING 96/30/06 99/30/06 12/31/06 93/31/07 Total Revenue $ 4,650 $5,863 $7,227 $7,616 Cost of Revenue 3,058 2,812 3,586 3,922 Gross Profit 1,593 3,051 3,641 3,694 Operating Income (Loss) $ (1,488) $ (159) $375 $541 EBITDA $(672) $ (342) $527" $676 Net Income (Lo
Slide 20: Consolidated Balance Sheet Highlights
Consolidated Balance Sheet Highlights ASSETS Current assets: Cash and cash equivalents $ 3,382,970 Accounts receivable, net of allowance for doubtful accounts 8,054,782 Revenues in excess of billings 7,368,794 Other current assets 2,588,747 Total current assets 21,395,293 Intangibles: Total intangib
Slide 21: Closing Remarks
Closing Remarks Najeeb U. Ghauri Chairman & Chief Executive Officer SLIDE 20
Slide 22: Q4 2007 Outlook
Q4 2007 Outlook = Continue to drive market share gains for LeaseSoft in the Asia- Pacific region = Further penetrate e-Government and Fleet Management vertical markets = Expand market and product reach in EMEA and North America = Accelerate integration of McCue Systems SLIDE 21
Slide 23: Capital Market Summary
Capital Market Summary Market/Symbol NASDAQ: NTWK Stock Price (as of 05-04-2007) $1.89 Shares Outstanding (as of 05-04-2007) 19.7 million Market Capitalization ~$37.2 million Float 9.3 million shares Cash (as of 03-31-2007) ~$3.4 million Total Debt (as of 03-31-2007) $1.2 million $225,000 = long-ter
Slide 24: Thank you