Interim Results 2019 Presentation 14 August 2019 Strictly Private and Confidential
Disclaimer This document contains certain forward ‐ looking statements with respect to the financial condition, results or operation and businesses of Network International Holdings Plc. Such statements and forecasts by their nature involve risks and uncertainty because they relate to future events and circumstances. There are a number of other factors that may cause actual results, performance or achievements, or industry results, to be materially different from those projected in the forward ‐ looking statements. These factors include general economic and business conditions; changes in technology; timing or delay in signing, commencement, implementation and performance of programmes, or the delivery of products or services under them; structural change in the satellite industry; relationships with customers; competition; and ability to attract personnel. You are cautioned not to rely on these forward ‐ looking statements, which speak only as of the date of this announcement. We undertake no obligation to update or revise any forward ‐ looking statements to reflect any change in our expectations or any change in events, conditions or circumstances. These interim results are not necessarily indicative of full year results; and the presentation does not constitute an offer or an invitation for the sale or purchase of the Company’s shares in any jurisdiction. 2
Operational overview Simon Haslam, CEO 3
Strong financial performance Revenues Underlying EBITDA Underlying EBITDA Margin* $152.3m $76.4m 47.2% +12.4% YoY +13.9% YoY +20 bps YoY Note*: Excluding EBITDA share of an associate 4
Strategic priorities Capitalise on structural market growth and regional adoption of digital payments Expand customer base as partner of choice for customers with pan ‐ regional scale Extend regional leadership position through rapid new product development and further market penetration SIGNIFICANT GROWTH OPPORTUNITY Leverage technology investment to improve provided by the shift operational efficiency and drive economies of scale from cash to digital payments in the world’s Actively pursue opportunities for growth acceleration – most underpenetrated organic and inorganic markets Strategic partnership with Mastercard to underpin further growth and accelerate payments adoption 5
Successful operational delivery Transformation on track – more than 96% of customer revenues now migrated to new technology platforms Continued demand from existing and new customers , including renewed contracts with Emirates NBD and Emirates Islamic Effective monetisation and cross ‐ sell of recently launched products, including N ‐ Genius, Falcon and N ‐ Advisors Commercial agreement with Mastercard signed which will provide upside to the management guidance over the medium ‐ term Investing to unlock incremental growth opportunities including accelerated market entry into Saudi Arabia 6
Middle East: Strong, sustained growth Healthy growth across both business lines $111.5m 9.3% in revenue increase year ‐ on ‐ year – Strong TPV growth in direct acquiring & acquirer processing and increase in number of transactions $81.5m 73.0% – Focus on cross ‐ sell of new product capabilities – contribution contribution margin demand for N ‐ Genius, Falcon and Card Control – Renewed contracts with two of our largest customers – Emirates NBD and Emirates Islamic – and continued Lebanon to win new merchant and financial institution clients Jordan Kuwait – Strategy to enter the Saudi Arabian market developing rapidly, with incremental investments and UAE upside to the management guidance Saudi Arabia Customers Serviced by Network International 7
Africa: Excellent growth trajectory Superior revenue growth due to the continued $40.8m 21.6% evolution of the African payments market revenue increase year ‐ on ‐ year – Significant increase in number of cards hosted and TPV $28.3m 69.4% from acquirer processing relationships contribution contribution margin – Ongoing cross ‐ sell of products and services to existing 160+ client relationships ‐ growing interest in the N ‐ Genius POS solution, roll ‐ out ahead of plan in H2 2019 – Signed new acquirer processing relationships and prepaid hosting deals, across all the three regions – Several strategic opportunities under review to unlock further bank outsourcing and financial inclusion potential Customers Serviced by Network International 8
Growing product portfolio ONGOING FOCUS ON PRODUCT DEVELOPMENT Continue to Strong sales Positive feedback Continue to further monetise recently pipeline across from new and improve product launched products both the regions existing customers capabilities SIGNIFICANTLY ENHANCING OUR CUSTOMER OFFERING MERCHANT SOLUTIONS ISSUER SOLUTIONS – – Over 10,000 N ‐ Genius terminals deployed in UAE with Two customers already live on Falcon – our real time fraud POS roll ‐ out to begin in Africa from H2 2019 monitoring solution launched in late 2018 – growing interest from a number of others – Launched N ‐ Genius Online in February; several customers already live with plan to start migrating existing ones in – Highly successful launch of Card Control ‐ allows customers to H2 2019 manage their cards dynamically – – Multi currency payments – 200+ merchants signed up Strong pipeline for prepaid products from customers in both since launch the Middle East and Africa 9
Technology supports Generating operational efficiencies strategic priorities Transformation close Digitisation journey to drive Separation from Emirates to completion efficiencies NBD More than 96% of customer Robotics process automation Separation of shared services from revenues now migrated introduced in H1 2019 ENBD to commence in H2 2019 On track to complete all Completed digital onboarding To drive operational flexibility and migrations before end of 2019 integration for merchants in the UAE position Network for long term growth Technology transformation in ‐ line with strategic principles 2014 2015 2016 2017 2018 2019 2020 and onward Customer Migrations and Continuous Improvement Technology Platform Transformation Product Development and Innovation 10
Commercial agreement signed with Mastercard Agreement to drive Network to remain Mastercard to scheme agnostic accelerated payment support product co ‐ penetration, usage, development and and acceptance across provide access to MEA their technology Commitment to Mutual sales and go ‐ Joint Steering invest $35m in joint to ‐ market approach Committee agreed to priorities, spread agreed provide strategic over five years guidance and alignment 11
Pursuing growth accelerators Accelerate market entry Prioritise financial Consider inorganic into Saudi Arabia inclusion in key markets growth opportunities Inclusion in new Saudi Issued the first cards on Primary focus will Arabian Monetary the new Meeza payment remain on our organic Authority Sandbox scheme in Egypt growth drivers Legal entity setup Roll ‐ out of N ‐ Genius in Africa to To support product capability and office opened enable low cost of acceptance or market consolidation Customers already Opportunity to utilise platform Continue to scan the signed with robust for mobile money acceptance market to identify sales pipeline potential opportunities 12 12
13 Rohit Malhotra, CFO Financial Review
Financial summary Six months ended 30 June 2019 2018 Change Strong organic revenue growth ($m) ($m) across Middle East and Africa demonstrating continued execution Total revenue 152.3 135.6 12.4% of our strategy Underlying EBITDA margin broadly Underlying EBITDA 76.4 67.1 13.9% flat, after absorbing incremental public company costs Underlying EBITDA margin* 47.2% 47.0% 0.2pp – Reflects benefits of economies of scale and operating leverage Underlying net income 43.8 41.7 5.1% inherent in the business Underlying net income reflects Profit from continuing operations 15.8 35.3 (55.4)% increase in D&A charge from recent investments Underlying earnings per share ($c) 8.77 8.35 5.0% Statutory results impacted by Reported earnings per share ($c) 2.94 6.42 (54.2%) specially disclosed items Note* Note* : Excluding EBITDA share of an associate 14
Strong volume growth Total processed volume (TPV) ($bn) Average number of cards hosted (m) Number of transactions (m) +11.1% +10.8% +6.3% 12.7 367.4 21.5 +11.5%* 13.5 12.1* 330.8 19.4 H1 18 H1 19 H1 18 H1 19 H1 18 H1 19 Note*: Growth in number of cards hosted excluding the First Gulf Banks demigrated in Jan 2019 15
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