Delivering Strong Performance & Furthering Momentum for Market Leadership Altium Half Year Investor Presentation 17-18 February 2016 (Sydney) Aram Mirkazemi - CEO 22 February 2016 (Melbourne) Martin Ive - VP Finance Kim Besharati - VP IR
Disclaimer This presentation has been prepared by Altium Limited (ACN 009 568 772) and Future performance - Forward looking statements, opinions and estimates provided in this presentation are based on assumptions and contingencies which is for information purposes only. It does not constitute financial product or are subject to change without notice, as are statements about market and investment advice or a recommendation to acquire Altium shares and has been industry trends, which are based on interpretations of current market conditions. prepared without taking into account the objectives, financial situation or needs Forward looking statements including projections, guidance on future earnings of individuals. Before making an investment decision prospective investors and estimates are provided as a general guide only and should not be relied upon should consider the appropriateness of the information having regard to their own objectives, financial situation and needs and seek legal and taxation advice as an indication or guarantee of future performance. An investment in Altium appropriate to their jurisdiction. Altium is not licensed to provide financial shares is subject to investment and other known and unknown risks, some of product advice in respect of Altium shares. which are beyond the control of Altium Limited. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or Altium, Altium Designer, Altium Vault, Ciiva, Circuitmaker, Circuistudio, correctness of the information, opinions and conclusions contained in this Octopart, PCBWorks, Protel and Tasking, and their respective logos, are presentation. To the maximum extent permitted by law, none of Altium trademarks or registered trademarks of Altium Limited, or its subsidiaries. All employees, its directors, employees or agents, nor any other person accepts any other registered or unregistered trademarks mentioned in this presentation are liability, including, without limitation, any liability arising out of fault or negligence, the property of their respective owners, and no trademark rights to the same are for any loss arising from the use of the information contained in this presentation. claimed In particular, no representation or warranty, express or implied is given as to the accuracy, completeness or correctness, likelihood of achievement or reasonableness of any forecasts, prospects or returns contained in this Presentation nor is any obligation assumed to update such information. Such forecasts, prospects or returns are by their nature subject to significant uncertainties and contingencies. Before making an investment decision, you Financial data should consider, with or without the assistance of a financial adviser, whether an All dollar values are in US dollars (US$) unless as otherwise investment is appropriate in light of your particular investment needs, objectives presented. and financial circumstances. 2
Agenda Company Highlights & Successful Execution 1 2016 Half Year Financial Performance 2 Pursuing Market Leadership in PCB Design Software 3 Appendix: Company Overview & Long – Term Outlook 4
First Half Financial Highlights and Long Term Outlook • Sales growth of 22% $100M • Revenue growth of 13% 50M Revenue • On-track to reach $100M in Sales > 30% revenue for 2017 40M EBITDA • 27.5% EBITDA margin for existing business up from 26.7% (excludes revenue and 30M costs from acquisitions) Expense • 23% increase in number of new AD licenses sold 20M • Increase in renewal rate to H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 87% from 84% in developed 2017 regions 2011 2012 2013 2014 2015 2016 4
Introduction Driving Performance from a Position of Financial Strength Altium’s H1 FY16 Financial Metrics EBIT $9.1M $41.1M Sales $46.4M $9.7M NPAT Cash 29,300 (up 22% pcp) (up 35% pcp) (up 1% pcp) Subscribers A$748M $10.7M ( 42% of Revenue ) 7.12 $42.6M Revenue Market EBITDA EPS (up 13% pcp) CAP (up 6% pcp) (up 26%) EBIT $5.7M AU 10c 13% 438 Debt Margin 23% Dividend Op Cash Flow CAGR Free Employees (down from (up 25% pcp) (down 22% pcp) 26%) * * Includes revenue and costs from acquisitions INVESTOR PRESENTATION 5
Operating Expenses Expenses for the existing business for Acquired Entities the full year is expected Operating Costs to be less than 10%. Organic Cost Growth 16% 5% Existing Business Acquisition 5% Growth in Expenses 8% Expenses 8% Operating Expenses 2% Though it remains a 3% 1% challenge, we hope to Rebuilding achieve our aspirational US Sales to goal of 30% EBITDA Full Strength One-off Costs (Professional Fees margin for fiscal year 2016. One-off Costs associated with (Relocation of Acquisition) Business to US) 6
Progress Update – First Half Significant Milestones America delivered a record breaking first half (25% revenue growth and 40% sales growth) EMEA is back on track delivering a solid performance (19% revenue growth and 24% sales growth in local currency) Partnered with Dassault Systemes SOLIDWORKS to introduce a new line of electronic CAD products reinforcing Altium’s bid for market leadership Released our fourth consecutive annual update to our flagship product Altium Designer 16 Successfully completed and integrated our first acquisitions (Octopart and Ciiva) Closed the largest multi-year TASKING deal with a tier 1 automotive supplier ($2.7 million) 7
Achieving Market Leadership by 2020 Altium’s strategy to maintain At the current CAGR mainstream price leadership through $150M revenue for Altium’s PCB a transactional sales model while product line will approach In Pure PCB delivering capabilities that rival high- $150M in revenue by 2020. end tools’ is fundamental to Altium’s Revenue bid for market leadership. 2015 2017 2020 2025 Strong Strategy, $100 Million Emerging as a Global PCB Market Strong Balance Revenue & Further Leadership Leader in System Sheet & Revenue Acquisitions Design Automation Momentum 8
ANSYS – A Case Study for Achieving Market Leadership Delivering Market-Leadership through Focus, Fiscal Discipline and a Well-Executed M&A 1BN in Revenue • High calibre team delivering on a 314M singular business focus. • Innovative business model to 834M capture opportunities that evolve within the industry. 565M • Strong and very consistent fiscal management to drive organic growth. • Acquisition of complementary 50M in technology businesses. Revenue • Achieving EBITDA margin of 48% at 1BN revenue. 1995 2005 2015 Revenue Operating Cash Flow 9
Agenda Company Highlights & Successful Execution 1 2016 Half Year Financial Performance 2 Pursuing Market Leadership in PCB Design Software 3 Appendix: Company Overview & Long – Term Outlook 4
Revenue by Region Americas – US$M EMEA - US$M 20 20 CAGR 17% CAGR 12% 15 15 5 YEAR 10 10 5 5 CAGR 13% - - Across All Regions APAC - US$M China - US$M PCB – First Half 20 20 PCB - Second Half CAGR 11% CAGR 2% 15 15 TASKING 10 10 Recurring revenue 5 5 - - 11
Altium’s Revenue Sources Vault Products Subscriptions Attached Altium Term Based 0.8M to New Licenses 3M Licenses 0.7M Lapsed Subscriptions Rejoining and upgrades 1.6M Altium PCB Altium PCB 42% 38% Subscription Software (New and Upgrades) 17.8M 15.8M Subscription Renewals 13.2M TASKING 3% Licenses 3.4M Other TASKING Octopart 2.4M Maintenance 1.5M 1.7M 12
Revenue - Board and Systems BSD – Americas (US$M) BSD - Rest of World (US$M) 20 10 CAGR 7% CAGR 17% 8 15 6 10 4 5 2 - - H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 FY11 FY11 FY12 FY12 FY13 FY13 FY14 FY14 FY15 FY15 FY16 FY11 FY11 FY12 FY12 FY13 FY13 FY14 FY14 FY15 FY15 FY16 BSD – EMEA (€M) 5 YEAR 12 CAGR 14.3% Globally 10 CAGR 17% 8 Total revenue – First Half 6 Total revenue – Second Half 4 2 Recurring revenue - H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 FY11 FY11 FY12 FY12 FY13 FY13 FY14 FY14 FY15 FY15 FY16 13
Revenue - TASKING & Octopart TASKING (US$M) Octopart (US$M) 6 6 5 5 CAGR 15% 4 4 3 3 2 2 1 1 - - H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 FY11 FY11 FY12 FY12 FY13 FY13 FY14 FY14 FY15 FY15 FY16 FY11 FY11 FY12 FY12 FY13 FY13 FY14 FY14 FY15 FY15 FY16 Octopart – First Half TASKING – First Half` TASKING – Second Half Octopart – Second Half Recurring revenue 14
Board and Systems – Underlying Metrics Altium Designer Seat Count PCB Subscription Pool 3,000 30,000 2,500 25,000 2,000 20,000 1,500 15,000 1,000 10,000 500 5,000 - - H1 FY13 H2 FY13 H1 FY14 H2 FY14 H1 FY15 H2 FY15 H1 FY16 Jun-13 Dec-13 Jun-14 Dec-14 Jun-15 Dec-15 Americas EMEA Rest of World 15
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