Full Year Results to 31 December 2019 April 2020
Presentation Team Subash Menon Nicholos Hellyer Finance Director Managing Director & CEO ➢ Subash co-founded Pelatro in April 2013 ➢ Nic, is a Chartered Accountant and former investment banker of over 25 years of experience ➢ Prior to Pelatro, Subash was the CEO and Founder of Subex – a company he transformed ➢ Nic spent the majority of his banking career at from a systems integrator in telecoms hardware UBS and HSBC, advising on a wide range of to a global leader in telecoms software for transactions including public takeovers, private business optimization M&A, IPOs and other equity fund raisings ➢ Subash guided Subex through a successful IPO in ➢ Nic has also spent time in industry as CFO of 1999 and through seven acquisitions in the UK, Buddi Limited and as Partner at Opus Corporate US and Canada Finance 2
Highlights ➢ Revenue increased 9% to $6.67 million (2018: $6.12m) ➢ Recurring revenue increased 63% to $2.96m (2018: $1.82m), 44% of revenue ➢ Won our largest contract to date, from one of the largest global telcos (350 mln subscribers) ➢ Added 5 customers organically, the highest number of customers in any year to date ➢ Won the first customer for our Data Monetisation Platform (Tele2, Kazakhstan) ➢ More than doubled the number of subscribers being processed by our solutions, from 350m to 800m ➢ Set up a dedicated team to focus on Customer Engagement 3
Introduction THE PROBLEM PELATRO’S SOLUTION ➢ ➢ Telco’s face a growing number of challenges – with their commoditized services Pelatro provides proprietary technology to Telcos to drive underlying Telcos are looking to existing subscribers to generate new revenue streams subscriber engagement and drive incremental revenue for Telcos of up ➢ Telcos are looking to increase Average Revenue Per User as opposed to increase to 5% per year while reducing churn ➢ subscriber numbers Enables Telcos to partner with the B2C players and provide a mobile ➢ Retaining customers is cheaper and more profitable than acquiring – however, advertisement and sales platform for non Telco products to the churn is very high subscriber base (using Data Monetization software) ➢ POSITIONED WITHIN THE MULTI CHANNEL MARKETING HUB SPACE MVIVA CONTEXTUAL MARKETING PLATFORM NEW PRODUCT: DATA MONETIZATION PLATFORM LOYALTY MANAGEMENT SOLUTION • mViva collects data on a real time basis which enables the platform to develop accurate profiles of million of subscribers on the actual usage of different products and demographics spread over a long period of time • Pelatro’s mViva technology processes and analyses the subscriber data in a real time manner to reveal patterns, trends and ke y behavioural traits as they evolve to have an accurate of each subscriber at all times • mViva facilitates continuous, relevant and contextual interactions in a true omni channel engagement model to influence the usage behavior thereby increasing revenue and reducing churn Application: Send contextual, relevant, personalized and real time campaigns Application: B2C partners of the telco can segment the subscribers and Application: The telco can set up attractive loyalty programs to increase to stimulate higher usage target individuals subscribers with personalized, mobile advertising usage and reduce churn Mr Smith has consistently been browsing YouTube, but does not have a data Mr Smith travels to certain specific countries regularly, used a high end Mr Smith has been a customer for several years and uses various products pack. The Telco can target Mr Smith using this analysis in real time and offer phone, has a monthly bill that is in the upper quartile. An overseas travel resulting in a high revenue to the telco. Create multiple tiers, position him in a special YouTube data pack which will result in incremental revenue for the insurance company can send a tailor made product to Mr. Smith pricing it the highest tier and offer him points for his usage which can then be telco while ensuring higher customer satisfaction. based on his risk profile. redeemed for telco and non telco products. 4
Group Overview Revenue CAGR Adjusted PBT CAGR Founded in 78% 59% 19 2013 Since 2016 Since 2016 Telco customers in 17 countries (1 in 2015) Revenue in $m Adj. PBT in $m 3.5 8 3 6 2.5 2 4 1.5 2 1 0.5 0 0 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 5
A Review of 2019 Expanded within Telenor Group by winning contract Largest contract Danateq from a new OpCo – won – 5 years Won the first integration leveraging the Managed contract for DMP completed acquisition Services Mar Apr Aug Dec Jan Mar Aug Nov Dec New sales Expanded within New sales person mViva V6 launched Revenue Model person in CALA SingTel Group by in APAC change gained winning contract significant from a new OpCo – momentum leveraging the throughout the acquisition year 6
Recurring Revenue – Key Focus Area Recurring Revenue Recurring Revenue Run Rate in US$M in US$M 5 3.5 2.96 4.0 3 4 2.5 3 2 1.82 2 1.5 1.5 1 1 0.47 0.5 0 0 Recurring Revenue as 0 0 Jan-18 Jan-19 Jan-20 2016 2017 2018 2019 % of Total Revenue 0.5 44% 0.4 30% 0.3 0.2 15% 0.1 0 0 2016 2017 2018 2019 Target: Run rate at the start of an FY should be equal to the revenue target for the year. 7
Financial Highlights Group Revenue Adjusted EBITDA ➢ $2.96m of recurring revenue (44%) 2019 6.67 2019 2.89 ➢ Reflects increasing shift from "one off" licences – up from 30% in 2018 – 6x increase 2018 6.12 2018 3.75 in 2 years 2017 2017 3.15 2.01 2016 2016 1.21 0.49 0 2 4 6 8 0 1 2 3 4 Recurring Revenue Profit Before Tax 2019 2.96 2019 0.8 2018 1.82 2018 2.8 2017 0.47 2017 1.8 2016 2016 0 0.4 0 0.5 1 1.5 2 2.5 3 3.5 0 0.5 1 1.5 2 2.5 3 All Figures in US$ Mln 8
Income Statement Profit & Loss 2019 2018 ➢ Cost of sales increase largely due to cost of support $’000 $’000 (audited) (audited) staff (and full year of former Danateq employees) 6,667 6,123 Revenue (999) (555) Cost of providing services _______ _______ ➢ Overhead cost also largely staff driven 5,668 5,568 Gross profit (2,819) (1,818) Overhead expenses _______ _______ 2,849 3,750 ➢ Amortisation reflects increasing value of underlying Adjusted EBITDA Amortisation and depreciation (excl. (1,229) (603) acquisition-related) development costs (plus acquisition from Danateq) _______ _______ 1,620 3,147 Adjusted operating profit 236 (310) Exceptional items ➢ Exceptional gain of $236k is adjustment to Danateq Amortisation of acquisition-related (686) (286) intangibles contingent consideration (52) Share based payments _______ _______ 1,118 2,551 Statutory operating profit Finance income 54 33 (164) (71) Finance expense _______ _______ 1,008 2,513 Profit before taxation (194) (334) Income tax expense _______ _______ 814 2,179 PROFIT FOR THE YEAR Earnings per share 2.5¢ 8.0¢ Statutory 4.2¢ 10.1¢ Adjusted 9
Balance Sheet Balance Sheet as on 31 st December 2019 2018 $’000 $’000 (audited) (audited) Assets ➢ Reflects impact of IFRS 16 leases ($339k of Non-current assets Intangible assets 10,891 10,609 "Right-of-use" assets and $392k liabilities) Property, plant and equipment 515 362 Right-of-use assets 339 - Deferred tax assets 63 - Contract assets 519 312 Trade and other receivables 231 321 ➢ Trade receivables - "unbilled" proportion reflects _______ _______ 12,558 11,604 weighting of contract completion to end of year Current assets Trade receivables - invoiced 967 1,813 Trade receivables – Unbilled Revenue 4,316 1,939 _______ _______ Total trade receivables 5,283 3,752 ➢ Movement in contract assets and liabilities also Contract assets 293 72 Other assets 501 382 principally due to nature of underlying contracts Cash and cash equivalents 1,101 2,224 _______ _______ 7,178 6,430 and year end weighting Liabilities Non-current liabilities Borrowings 362 382 Lease liabilities 187 - ➢ Other financial liabilities comprise the Danateq Contract liabilities 274 112 Long-term provisions 124 - Other financial liabilities - 1,141 earnout - shift from non-current to current plus _______ _______ 947 1,635 adjustment to reflect revised expectations Current liabilities Trade and other payables 523 609 Short term borrowings 246 69 Lease liabilities 205 - Contract liabilities 665 61 Other financial liabilities 948 298 _______ _______ 2,587 1,037 Total liabilities 3,534 2,672 NET ASSETS 16,202 15,362 10
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