Altus Group Limited · TSX:AIF
Altus — Investor Day (June 2019)
31 slides from Altus's investor day presentation, Jun 26, 2019
Slide 1: Altus Analytics Investor Update
Altus Analytics Investor Update June 26, 2019 1
Slide 2: Presentation Agenda
1. Altus Analytics Growth Strategy Robert Courteau, Chief Executive Officer 2. Altus Analytics Cloud Transition Carl Farrell, President Presentation Agenda 3. Altus Analytics Financial Outlook Angelo Bartolini, Chief Financial Officer June 26, 2019 4. Summary and Q&A Q&A open to analysts & instituti
Slide 3: Caution Regarding Forward-Looking Statements
Caution Regarding Forward-Looking Statements This presentation contains certain statements that constitute forward-looking information within the meaning of applicable securities laws (“forward-looking statements”), including without limitations, the statements contained in section entitled "Altus A
Slide 4: Non-IFRS Measures
Non-IFRS Measures This presentation makes reference to certain non-IFRS financial measures. These non-IFRS financial measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by oth
Slide 5: Executive Summary
Executive Summary Robert Courteau, Chief Executive Officer 5
Slide 6: Executive Summary
• Targeting to transition Altus Analytics to +90% recurring revenue model by 2021 • In Q3, all ARGUS Enterprise (AE) sales to net new customers are expected to be cloud subscriptions & over time migrating on- Executive Summary premise ARGUS software customers to cloud subscriptions • Strong recurrin
Slide 7: Executing on our Plan: Increasing long-term growth potential
Executing on our Plan: Increasing long-term growth potential with high-growth, Client & industry demand high-margin model with Product readiness predictable revenues Compelling economic benefits Established recurring revenue base eases Targeting transition of Altus Analytics transition to 90
Slide 8: Altus Analytics Growth Strategy
Altus Analytics Growth Strategy Robert Courteau, Chief Executive Officer Cloud transition supports higher wallet share expansion, new customer growth & geographic expansion 8
Slide 9: Evolution of ARGUS Software Strategy
Evolution of ARGUS Software Strategy Strategic objectives driving strategy: SET THE ARGUS ENTERPRISE (AE) STANDARD GLOBALLY Move the market to a single 1 ARGUS Enterprise standard 2013 - Current Wave 1 Wave 2 Wave 3 Go Global North America DCF Upgrade UK ValCap Upgrade Multi-Product, Integrated 2 Es
Slide 10: "ARGUS Everywhere" Go To Market Plan
“ARGUS Everywhere” Go To Market Plan Increasing wallet share & crossing borders with multiple capabilities Cross-Sell / Up-Sell Market Expansion Integrated Offerings New Cloud Products Global Deployment ARGUS as a multi- Focus on Germany, Focus on global, multi- Driving value through Focus on Top 20
Slide 11: Significant Market Opportunity
Significant Market Opportunity Wide TAM Multiple Avenues for Growth Supports 2023 Goal Future Opportunities 03 • Data Monetization Upside • New CRE Market Verticals Top 200 Global & <15% global market Net New Customer 02 penetration leaves plenty Growth Opportunity of room for growth Wallet Share Ex
Slide 12: Strong Foundation for Next Phase of Growth
Strong Foundation for Next Phase of Growth Exceptional Customer & Industry Validation 6,500+ software clients (~4K on AE) – GLOBAL Unmatched Altus 100+ data benchmarking & attribution clients (Appraisal Management) – US, EUROPE, ASIA Analytics Client Base 500+ Canadian market data customers Tr
Slide 13: Altus Analytics Cloud Transition
Altus Analytics Cloud Transition Carl Farrell, President Significant customer value proposition to drive cloud adoption throughout 2019 & 2020, with a target to migrate majority of ARGUS Enterprise users to the cloud by 2023 13
Slide 14: Extending ARGUS Enterprise to ARGUS Cloud
Extending ARGUS Enterprise to ARGUS Cloud No migration Supports existing implementations Preserves investment and value 14 altusgroup.com
Slide 15: Extending ARGUS Enterprise to ARGUS Cloud
Extending ARGUS Enterprise to ARGUS Cloud Continuous development of NEW CLOUD APPS cloud functionality Enhanced additional functionality for new and seasoned AE users Enhance and deliver new cloud applications to address key business areas 15 altusgroup.com
Slide 16: Continue to Extend ARGUS Cloud Eco-structure
Continue to Extend ARGUS Cloud Eco-structure Enhance and deliver new cloud NEW CLOUD APPS 3rd PARTY APPS applications to address key business areas Connect all ARGUS solutions Building a global asset and investment management solution connecting all software applications & data on one single
Slide 17: Cloud Benefits for Customers
Cloud Benefits for Customers Front End Compelling economic & operating Data Input Collaboration Reporting & Workflows Analytics benefits for customers Simple migration, no new implementation Calc Engine Integrations Storage Transparent internal business Back End collaboration Extensive reporti
Slide 18: Customer Adoption Example
Customer Adoption Example Based on current prospects: What’s the industry trend? CUSTOMER PROFILE - Large global customers want a global data standard across their Large, global service provider organizations to better utilize their internal data What ARGUS Cloud solves for: - Going to ARGUS Cloud p
Slide 19: AE Transition to Cloud and Subscription
AE Transition to Cloud and Subscription Cloud Deployment On Premise Deployment As of July 2019 Mid-Term Long-Term • ADD-ON : Buy additional users as • ADD-ON : Buy additional users as Cloud licenses, upgrade existing users Cloud licenses, upgrade existing users to Cloud to Cloud • RENEWAL : Upgrade
Slide 20: New Market Opportunity: Data Driven Insights
New Market Opportunity: Data Driven Insights AE Data 1 • Brings high value data that can be Published to reported, benchmarked, the Cloud Aggregated from Multiple aggregated and used to drive high Organizations value analytics for customers 5 • Utilizes the cleanest CRE industry data in an automated
Slide 21: Cloud Enables Higher Operating Efficiencies
Cloud Enables Higher Operating Efficiencies Compelling economic & operating benefits for both Altus Group and our Shareholders Speed of development and innovation An environment that is flexible, scalable and has strong integration capability One product platform Lower cost of customer suppo
Slide 22: Altus Analytics Financial Outlook
Altus Analytics Financial Outlook Angelo Bartolini, Chief Financial Officer Strong recurring revenue base sustains y/y Altus Analytics revenue growth during key transition years in 2019 & 2020 22
Slide 23: Solid Track Record of Execution
Solid Track Record of Execution From 2015 – 2018: 16+% CAGR in recurring ~4K AE customers, including 46+% revenue growth revenues*, which represent ~ 1k AOD customers 70+% of total AA revenues 37+% adj. EBITDA* growth, ~97% retention rates 95+% growth in EMEA & with an avg. 3 yr. adj. for AE softwar
Slide 24: AA Revenue Evolution
Lower Risk Transition Full Subscription Model Transition to Subscription 70% recurring revenue in 2017 targeting growth Point in Time License Model to 90% by 2021 100% $15 M $16 M Perpetual license sales currently represent only Percent to Total AA Revenues 80% $36 M $41 M 15% of total AA AA Rev
Slide 25: Altus Analytics Long Term Financial Potential
Altus Analytics Long Term Financial Potential $450 KEY ASSUMPTIONS: • • ~15% bookings growth Mid 90% retention No dip in 2020 during • Mid-teen growth in Data & Appraisal Management 2023 transition due to high $400 TARGET REVENUE existing over time revenue KEY ASSUMPTIONS: • ~5% bookings growth $4
Slide 26: Improving Visibility During the Transition
Improving Visibility During the Transition Key Metric for Tracking Growth 2019 • Includes revenues related to software & data subscriptions, maintenance for perpetual licenses and appraisal management solutions, where the contract value Recurring Revenues for software subscriptions is recognized rat
Slide 27: 2019 Key Transition Year
2019 Key Transition Year ALTUS ANALYTICS 2019 FINANCIAL PERFORMANCE GUIDANCE GUIDANCE: $197 - $205 FY 2019 Revenue Range ($M) 7% - 12% Year-over-Year Revenue Growth Range 16% - 19% Year-over-Year Recurring Revenue* Growth Range 17% - 20% Adjusted EBITDA Margin* Range 27 altusgroup.com *Non-IFRS meas
Slide 28: Summary
Summary Robert Courteau, Chief Executive Officer Transition to cloud subscriptions enhances economic value and increases the long-term growth potential with a high-growth, high- margin model with predictable revenues 28
Slide 29: Altus Analytics 5-Year Growth Ambitions
Altus Analytics 5-Year Growth Ambitions Reach $400M Total Revenues ~$200M Revenues by end of 2023 8,000+ Software Customers & Platform 6,500 Software Customers for the Industry On-Premise Software Complete Cloud Solution Portfolio Standalone Solutions and Integrated Software, Data and Service Servic
Slide 30: Q&A
Q&A All other inquiries please contact Investor Relations: [email protected] 30
Slide 31: Disclaimer
Disclaimer This documentation is a presentation of general background information about Altus Group’s activities current as the date of the presentation. It is information in a summary form and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential