Technology One Limited · ASX:TNE
Technology One — UBS Emerging Companies Conference 2012
49 slides from Technology One's conference presentation, April 2012
Slide 1: UBS Presentation
____ __Technology ____ _____ One ____ Ltd UBS ______ Presentation _____ _____ 4 ____ _____ April 2012 - Technology One Ltd (ASX:TNE) today conducted a _____ _____ presentation at the UBS Emerging Companies conference. ____ The _____ attached presentation was given at this meeting by the company’s Ex
Slide 2: UBS Emerging Companies Conference
UBS Emerging Companies Conference Adrian Di Marco [email protected] Final Commercial in confidence April 2012
Slide 3: Agenda
Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 4: TechnologyOne is an enterprise software vendor
____ __ ____ _____ ____ ______ _____ _____ ____ _____ TechnologyOne is an enterprise software vendor _____ _____ ____ _____
Slide 5: TechnologyOne Overview
TechnologyOne Overview Our enterprise solution consists of the following products: Financials ____ __ ____ Supply Chain _____ ____ ______ _____ _____ Asset Management ____ _____& Payroll Human Resource Corporate Performance Management _____ _____ • Business Intelligence ____ _____ • Budgeting
Slide 6: The Competitive Landscape
The Competitive Landscape New expanding market coverage ORACLE SAP/R3 ____ __ ____ _____ ____ ______ $1,000m _____ _____ Current market coverage ____ _____ TechnologyOne _____ _____ $100m ____ _____ Microsoft Business Solutions SAP/Business One Infor (Sun Systems) $30m Reckon CLIENT TURNOVER MYOB
Slide 7: TechnologyOne targets seven vertical markets
TechnologyOne Overview TechnologyOne targets seven vertical markets: ____ __Government • Local ____ _____ ____ ______ _____ _____ • Government (State, Central and Federal) ____ _____ • Education _____ _____ • Financial Services ____ _____ • Health, Community Services and Not for Profit • Utilities •
Slide 8: 900+ High Profile Customers
900+ High Profile Customers ____ __ ____ _____ ____ ______ _____ _____ ____ _____ _____ _____ ____ _____
Slide 9: TechnologyOne Overview
TechnologyOne Overview Offices in Australia, New Zealand, ____ Asia and __ more____ recently, _____ ____ ______ South Pacific and _____the United Kingdom (UK) _____ ____ One _____largest software of Australia’s houses _____ _____ Specialise in the research, ____ _____ development and commercia
Slide 10: Diversity of revenue streams
TechnologyOne Overview Diversity of revenue streams from multiple: ____ __ ____ _____ ____ ______ • Geographies _____ _____ – All states of Australia, New Zealand, Asia and more recently UK • Products ____ _____ – Financials, HR/Payroll, SupplyChain, Asset Management, Property, Students, CRM, CPM, E
Slide 11: Historical Performance
Historical Performance Strong financial track record … ____ Doubling__ ____ in size _____ approx every ____ 4 years ______ for 15 years _____ Continually_____ profitable since 1992 (20 years) ____ Revenue _____ Continually paid dividend since 1996 (16 years) _____ Cash and _____ Equivalents
Slide 12: Historical Performance: key metrics
Historical Performance Key metrics over last 15 years … 80 ____ -__ Revenue 22%____ per annum_____ compound____ ______ 70 _____ _____ 60 Even through the Dot-Com and GFC 50 ____ Initial _____ Licence Fees - 22% per annum compound $'m 40 _____ Annual _____ Licence Fees - 27% per annum compoun
Slide 13: Agenda
Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 14: Revenue Model
Revenue Model Initial Licence - based on usage ____ __of ____ • Matrix _____ licensable modules ____ (approx ______ 300 modules over 10 products), number of users _____ • Once _____ off ____ _____ Services - fee for service Implementation _____ • $1.20 _____ Services : $1 Initial licence ____ __
Slide 15: Revenue Model
Revenue Model Initial Implementation Annual Annual Annual Initial Licence Service Licence Licence Licence …. ____ __ ____ Purchase _____ ____ ______ _____ _____ -Specified: Products, Modules, No of Users ____ _____ Initial Annual Annual Annual Increase Licence Licence Licence Licence …. No _____ of
Slide 16: Revenue Model: customers have 3 products
Revenue Model ____ __ ____ _____ ____ ______ _____ _____ ____ _____ On average _____ _____our customers have 3 products (out of ____ a product range of 10) _____
Slide 17: Strong, very loyal blue chip customer base
TechnologyOne Overview Strong, very loyal blue chip FY11 New Other ____ __base customer ____ _____ ____ ______ Non-Recurring ** 9% New Licence _____ _____ • We provide a mission 8% critical solution – ‘sticky ____ _____ customer base’ _____ • 66% of_____ Existing 66% our revenues New ASM 2% ____ ___
Slide 18: Agenda
Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 19: What Makes Us Different
What Makes Us Different Enterprise Suite ____ __ ____ _____ ____ ______ • One of a few companies globally with an enterprise solution _____ Own the_____ IP to our software, which allows us to control our ____ future_____ _____ _____ model - Power of One Unique business ____ • Unique_____ appro
Slide 20: What Makes Us Different: vertical markets
What Makes Us Different Our focus on seven key vertical markets ____ • Deep__ ____ of _____ understanding ____ our target seven ______ markets _____ _____ • Understand their value drivers • Know the universe of opportunities in each of our market ____ _____ Preconfigured solutions for each of ou
Slide 21: What Makes Us Different: Preconfigured Solutions
What Makes Us Different 14 Preconfigured Solutions … One Government ____ __ ____ _____ ____ ______ One Not For Profit _____ _____ One Council One Grant ____ _____ One Housing One Network _____ _____ One Health One Water ____ _____ One Port One Polytechnic One Banking One Care O
Slide 22: Agenda
Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 23: Strategic Initiatives
Strategic Initiatives ____ __ ____ _____ ____ ______ New Offshore R&D Centre _____ _____ ____ _____ Compelling Customer Experience _____ _____Cloud TechnologyOne ____ _____
Slide 24: New Offshore R&D Centre
New Offshore R&D Centre R&D centre in Brisbane with 500+ staff ____ New __R&D offshore ____ centre_____ to handle____ ______ future growth _____ _____ To contain costs – operating leverage of offshore ____ _____ R&D staff _____ _____ To tap into a new pool of R&D talent outside of ____ Australia
Slide 25: Strategic Initiatives
Strategic Initiatives ____ __ ____ _____ ____ ______ New Offshore R&D Centre _____ _____ ____ _____ Compelling Customer Experience _____ _____Cloud TechnologyOne ____ _____
Slide 26: Compelling Customer Experience (CCE)
Compelling Customer Experience (CCE) Customer retention is critical to our future success ____ __ ____ _____ ____ ______ Future of ERP is all about customer retention _____ _____ ____ _____ Our focus is to give our customers a compelling customer experience _____ _____ ____ _____ Compelling cu
Slide 27: Strategic Initiatives
Strategic Initiatives ____ __ ____ _____ ____ ______ New Offshore R&D Centre _____ _____ ____ _____ Compelling Customer Experience _____ _____Cloud TechnologyOne ____ _____
Slide 28: Today – On Premise
Today – On Premise Database Server ____ __ ____ _____ ____ ______ _____ _____ Citrix Servers N-tier Application Servers Distributed Processors ____ _____ client _____ _____ ____ _____ Installation Servers A complex computing model
Slide 29: The Future – The Cloud
The Future – The Cloud Off Premise ____ __ ____ _____ ____Service ______Provider _____ _____ ____ _____ client Internet connection _____ _____ ____ _____ A simpler computing model
Slide 30: TechnologyOne Cloud
____ __ TechnologyOne Cloud ____ _____ ____ ______ _____ _____ ____ _____ _____ _____ TechnologyOne Enterprise Suite in the cloud ____ _____ today, delivered via the browser... TechnologyOne takes care of everything
Slide 31: TechnologyOne Cloud
TechnologyOne Cloud TechnologyOne takes care of everything for a Yearly Subscription Fee… ____ __ ____ _____ ____ ______ Hardware, Operating Software, Middle ware etc.. _____ _____ Backup ____ Services _____ _____ _____ Replication Services & Disaster Recovery ____ _____ Upgrades IT staff
Slide 32: Cloud
Cloud ____ __ ____ _____ ____ ______ _____ _____ ____ _____ _____ _____ ____ _____
Slide 33: Agenda
Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 34: Newer Products, Increased Uptake
Newer Products, Increased Up take Enterprise Content HR/Payroll CRM ____ __ ____ _____ ____ ______ Mobile Solutions Management 4% 3% <1% Future Property 4% _____ _____ Growth Asset Management 6% CPM 31% CPM … as____ newer _____ 8% Financials & Supply Chain _____ _____ Student Management products 16%
Slide 35: Newer Vertical Markets, Increased Penetration
Newer Vertical Markets, Increased Penetration ____ Future __ ____ Growth _____ ____ ______ ...as _____ _____ we increase ____ _____ our penetration _____ _____ in newer vertical markets ____ _____ 71% Licence Fees come from Local Gov, Education and Health/Community
Slide 36: Newer Geographies
Newer Geographies Future ____ __ ____ _____ ____ ______ Growth _____ _____ …as the UK ____ _____ moves thru _____ _____ the GFC ____ _____ UK has significant potential growth for us in future years
Slide 37: Cross Sell into Existing Customer Base
Cross Sell into Existing Customer Base ____ Cross sell__ ____ more _____ products into our____ large ______ _____ existing_____ customer base ____ _____ 900 customers _____ _____ On average our customers have 3 products ____ (out of_____ 10)
Slide 38: Future Growth – Acquisitions
Future Growth – Acquisitions Acquisitions – not a high priority at this time ____ Acquire__ New____ _____ Customers ____ - cross sell ______ our existing products into _____ _____ Acquire New Products - cross to sell into our existing customers ____ _____ Existing Products (10) _____ _____ ____ _
Slide 39: Future Growth – ERP Replacement Cycle
Future Growth – ERP Replacement Cycle ERP Replacement Cycle of 10 to 15 years ____ Name of__the____ _____ game is those ____ that keep their______ customers versus those that will lose customers _____ _____ ____ _____because of... Well positioned _____ _____ Our Power Of One business model O
Slide 40: Future Growth Timeline
Future Growth Timeline ... Cross selling into our large customer base now ____ __ ____ _____ ____ ______ _____ _____ Newer products – increased uptake now ____ _____ Newer vertical markets – increased penetration now _____ _____ Cycle ERP Replacement now ____ _____ Newer geographies – UK year
Slide 41: Agenda
Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 42: Improved Margins
Improved Margins Profit margin has contracted over the last ____ 10 years__ ____ _____ ____ ______ _____ _____ Expanded our product range investment ____ Profit _____ margin now stabilised _____ Focus is to_____ substantially improve margins ____ over next_____ five years
Slide 43: New Products Contribution to Profit
New Products Contribution to Profit New Products Increase Profits Profit Contribution - Product - FY11 • ____ __ Opportunity ____ grow to substantially _____ the ____ ______ Asset Management ECM, CRM, contribution to profit by these Property HR/Payroll, Mobile _____ over _____ 3% 1% <1% Financials &
Slide 44: Control of R&D Costs
Control of R&D Costs Control of R&D costs … ____ __ ____ _____ ____ ______ _____ _____ ____ _____ Compound Growth 16% _____ _____ ____ _____ leveraging Offshore R&D to achieve substantial savings
Slide 45: R&D Growth Projections
R&D Growth Projections Model R&D growth over the next 5 years at 8% per annum • R&D currently projected to be $67m in year 5 (compared to $33.5m now) ____ __ ____ _____ ____ ______ • In year 5 our R&D will be $47m vs $67m, saving of $20m in one year _____ _____ • Saving of $52m over 5 years ____ ___
Slide 46: Agenda
Agenda Overview ____ __ ____ _____ ____ ______ Revenue Model _____ _____ What ____ _____makes Us Different _____ _____ Strategic Initiatives ____ _____ Future Growth Improved Margins Long Term Outlook
Slide 47: Long Term Outlook
Long Term Outlook Long Term Outlook is Strong ..... Enterprise Suite – one of a few companies globally with an enterprise solution ____ Power __– unique of One ____ _____ approach ____ to build, market,______ sell, implement and support our products _____ Vertical _____ markets focus – focus o
Slide 48: Long Term Outlook
Long Term Outlook Geographical expansion – United Kingdom has significant longer term growth ____ Our __Customer Compelling ____ Experience _____program ____– ______ retain our customers _____ New _____ offshore R&D centre – provide access to additional talent and operating leverage ____ _____
Slide 49: UBS Emerging Companies Conference
UBS Emerging Companies Conference Adrian Di Marco [email protected] Commercial in confidence April 2012
Technology One — UBS Emerging Companies Conference 2012 on 6ix