Full year results 2019 23 January 2020
Agenda Introduction & highlights Jason Kingdon Financials & customer deep dive Ijoma Maluza Strategic review & outlook Jason Kingdon Questions & Answers 2 Full year results January 2020
Introduction & highlights 3 Full year results January 2020
Financial highlights 83 % Revenue Recurring licence revenue £101.0 m 96 % increase in revenues FY19 £101.0m FY19 96% FY18 £55.2m FY18 94% 96 % licence based, Cash Exit monthly recurring revenue* £10.6 m £74.1 m recurring revenues FY19 £10.6m FY19 £74.1m 71% FY18 £6.2m FY18 £50.5m growth in MRR Adjusted EBITDA £(71.9) m £(71.9)m FY19 £(21.6)m FY18 • Exit MRR uses the average FX rate which at the end of October 2019 was £1:$1.25 4 Full year results January 2020
Financials & customer deep-dive 5 Full year results January 2020
Revenue breakdown By geography £47.5 m By type £40.9 m 1 % 3 % £26.8 m 96 % £21.3 m £13.7 m £12.6 m £9.0 m £7.1 m £1.8 m 2019 2017 2018 EMEA Americas APAC Licence and Professional Sponsorship Support services & other 6 Full year results January 2020
Operating cost base £m FY2019 FY2018 • Investments designed to Sales and Marketing 105.3 37.7 drive future growth Professional Services 20.3 7.5 Research & Development (R&D)* 12.5 4.3 • Considerable flexibility in General & admin 32.8 12.5 Group cost base Costs 170.9 62.0 • 64% (£108.1m) of total cost Commissions & other adj. 2.6 19.1 base relates to payroll cost Operating expenses 173.5 81.1 Notes: *£4.6m of R&D costs have been capitalised in FY2019 (FY2018: £0.3m). Also includes expenses relating to our TAP, which are classified as sales & marketing expenses in some other reconciliations ** Commissions & adj. reconcile Costs to Operating expenses in the Consolidated statement of profit or loss and other comprehensive income for the year ended 31 October 2019 as follows: 1. FY2019: Net impact of Share Based Payments of £7.2m and Capitalised R&D of £(4.6)m 2. FY2018: Net impact of Share Based Payments of £4.0m, Capitalised R&D of £(0.3)m and Commissions of £15.4m 7 Full year results January 2020
Operating cash flow Full Year 2019 H1 2019 H2 2019 Cash Operating Adjusted Operating EBITDA Cashflow Cashflow - • Operating cash outflow reflects peak of investment (10.0) (£19.6m) programmes (20.0) • Investments will drive cash (30.0) generation in 2020 (40.0) (£44.2m) Working Capitalised Capital Spend (50.0) (£57.9m) £13.8m (£5.9m) (£63.8m) (60.0) (£71.9m) (70.0) (80.0) Decrease Increase Total Notes: 1. Cash EBITDA is loss after tax adjusted for amortisation, depreciation, loss on property, plant and equipment, Finance income, Share-based payment expense, Income tax expense 2. Capitalised Spend includes Payment of software development costs and Purchases of property, plant and equipment 8 Full year results January 2020 3. Adjusted Operating Cashflow is Operating Cashflow less Capitalised Spend
New customer additions Building a sizeable enterprise customer base • 1,677 enterprise customers 1,677 • Large upsell opportunity 67 70 46 971 25 477 153 2016 2017 2018 2019 Customers Sectors covered High quality customer base 478 Share of industry participants in Forbes Global 2000 2019 Note: The Forbes Global 2000 is generally updated annually in the second quarter of the calendar year, and we adjust current and prior period G2K customer counts following the release of the latest Global 2000 list. We also adjust the G2K count for acquisitions, spin-offs and other market activity. Our G2K customer count does not include large private companies, government agencies and educational organisations, which represent a growing portion of our customer base. As a result, we expect our G2K customer 9 Full year results January 2020 count metric to become less relevant to our business over time.
Growth in upselling continues to unlock value Number of upsell deals • Land-and-expand model 1,139 • Consistent year-on-year growth in Upsells 723 • Upsells accounted for 72% of 2019 MRR additions 81 264 2016 2017 2018 2019 • Upsell deal sizes consistent Number of customers upsold across 2018 & 2019 544 310 47 131 2016 2017 2018 2019 10 Full year results January 2020
Retention remains very strong MRR breakdown • 99.3% gross retention rate £40k £10.6m • 143% net retention rate £9.9m £20k £6.2m £6k £3.2m £0.7m 2017 2018 2019 Closing MRR MRR acquired via MRR lost during the year Thoughtonomy 11 Full year results January 2020
The Group cohort shows significant growth across periods Cohort Growth H2 2019 H2 2019 n/a H1 2019 H1 2019 1x H2 2018 H2 2018 2x H1 2018 H1 2018 2x H2 2017 H2 2017 3x H1 2017 4x H1 2017 H2 2016 6x H2 2016 H1 2016 5x H1 2016 H2 2015 6x H2 2015 H1 2015 H1 2015 3x 12 Full year results January 2020
Summary • Delivered excellent revenue growth across all three main regions • Continued to strengthen existing customer relationships as demonstrated by high net retention rate of over 143% • Investments made during 2019 will drive growth and cash generation in 2020 and beyond 13 Full year results January 2020
Strategic review & outlook 14 Full year results January 2020
A Digital Workforce in every enterprise Our Vision: 1. We build Digital Workers aka “Software Robots” – Software as close to, or to exceed, a human worker The 21 st Century 2. Blue Prism : Organisation – Enterprise grade – Blue Prism robot is full stack software – Enterprise collaboration – Swarm to tasks “self-organizing” – Solves tasks 3. Features People Systems – Democratise technology 1/3 rd 1/3 rd – Consumes AI and is the on-ramps for deep AI consumption in the enterprise – Changes technology landscape through inter-operation Digital Workers Highest ROI studied by LSE 1/3 rd Every organisation needs a digital workforce: Blue Prism revenue is license rental – “robot wages” 15 Full year results January 2020
A Digital Workforce in every enterprise 20%+ 96 % 58 % of Forbes Global 2000 (G2K) Retention rate Increase in upsells 16 Full year results January 2020
New product Robot skills – business operating system Smarter, faster, more DIGITAL EXCHANGE intelligent robots… • Blue Prism Cloud Learning – Hub DECIPHER Planning & Visual – Interact Sequencing Perception – IADA BLUE PRISM DIGITAL WORKFORCE • Digital Exchange 1 – 100s of assets (robot assisted) Knowledge Problem & Insight Solving – Enterprise grade – Self Serve – NLP, ML, OCR, Image, Sentiment, Collaboration Search, Optimisation… DIGITAL EXCHANGE 3 – SAP, Salesforce 1 2 3 The Digital Workforce Decipher, which will be available The Digital Exchange provides easy forms a platform to in 2020, builds vision and access to our technology ecosystem of drive automation machine learning skills into the vendors like AWS and Google, bringing Digital Workforce improved skills to the Digital Workforce 17 Full year results January 2020
Automation as a skills exchange DX Digital asset Solutions Who: Blue Prism ecosystem members Who: Blue Prism ecosystem members who who have solutions have business problems to solve • Independent Software Vendors (ISVs) • End Users • System Integrators (SIs) • System Integrators (SIs) “There is an Asset • End Users • Resellers for that!” Why: to distribute the Assets they have Why: to quickly solve their business developed to Buyers for a fee or for free problems and thus increase the value of their The DX helps Blue Prism customers Blue Prism licenses through use of the DX solve their business problems using Assets that Sellers have posted on the DX, thus accelerating adoption and use of the Blue Prism platform 18 Full year results January 2020
Digital singularity… TAP Premium Visual Partners Problem Solving Planning + Sequencing TAP Affiliate Partners Learning Knowledge + Insight Collaboration 19 Full year results January 2020
Conclusions and outlook • Strong 2019 performance – Underpins confidence in our enterprise focus and the applicable market • Supporting our customers in building the 21 st Century enterprise • Investments in 2018 & 2019 have reinforced the business model • 2020 another step forward in exciting market 20 Full year results January 2020
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