Q2 2016 results 26 August 2016 CXENSE 2016 | Q2 2016 results www.cxense.com
CXENSE:OSE today • Sector Software-as-a-Service • Customers All companies with online sites and apps • Revenues NOK 200 million annualized – and growing Recurring software license fees • Gross margin 80%-85% • Organization ~170 employees in Europe, Americas and Asia CXENSE 2016 | Q2 2016 results www.cxense.com
End-user pull creates market People want relevant and engaging online experiences Personalization needed CXENSE 2016 | Q2 2016 results www.cxense.com
Personalization drives value Improved user experience More engagement Higher conversion Reduced churn Increased revenue CXENSE 2016 | Q2 2016 results www.cxense.com
Cxense – the online personalization SaaS company Companies with online sites/apps form the market | Serving +350 customers and +6,000 sites today 3 R&D hubs | 8 sales offices | ~170 employees in Americas, Europe and Asia Million >1.5bn devices interacted with Cxense technology in Q2’16 OSLO 1600 OSLO 1400 BOSTON LONDON 1200 BOSTON SAMARA 1000 MADRID NEW YORK 800 TOKYO 600 R&D 400 Sales and SINGAPORE marketing 200 0 Q3'11 Q4'11 Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'15 Q2'15 BUENOS AIRES Device = Browser with unique history. A user using Opera, Firefox and Chrome on one PC equals 3 devices. Mobile, iPad and so on are devices, as is one PC with several unique logins CXENSE 2016 | Q2 2016 results www.cxense.com
Growing customer base and adoption Consumer brands Financial services Cxense customers Q2’16 Sports e-commerce and classifieds Media Publishers and Broadcasters Time Verticals CXENSE 2016 | Q2 2016 results www.cxense.com
Cxense has a growth strategy… • Continue to commercialize the world’s leading personalization offering • Customer up-lift and add new customers to recurring revenue base Revenue growth • Minimize churn • Sharp focus on core, most value-enhancing products for customers • Cost effectiveness Profitability • Accelerated sales growth expected to move EBITDA break-even point beyond 2016 • Focused R&D investments to maintain and develop uniqueness Scalability • Streamlining a market-oriented organization to enhance sales efficiency • Financial flexibility CXENSE 2016 | Q2 2016 results www.cxense.com
…and has strengthened its financial platform • USD 19 million share issue to investment companies Aker, Ferd and USD 22m equity Charles Street issue in Q2/Q3 • USD 3 million subsequent offering with participation from board, management and others • Access to new shareholders Oslo Børs listing • Improved access to growth capital in Q3 • Improved share liquidity • Strong cash position enables accelerated pursuit of growth Positioned to • Both organic and acquired growth pursue growth • First step: Strengthen sales and marketing CXENSE 2016 | Q2 2016 results www.cxense.com
Q2 operational developments • Demand for personalization offering driving sales • Second highest level ever of new ARR and record average contract size • New business was signed late in the quarter with full revenue effect in H2 • High churn on legacy Maxifier contracts • Impacted early in the quarter • Churn is down into Q3 CXENSE 2016 | Q2 2016 results www.cxense.com
Revenue development Group revenue* 6 330 6 263 USD 1 000 6 056 4 818 4 174 4 152 4 140 4 115 3 881 3 540 3 212 1 708 1 500 1 110 1 065 887 619 389 Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 *Figures for period Q2’12 to Q1’13 are restated to exclude the discontinued operations of PPN AG CXENSE 2016 | Q2 2016 results www.cxense.com
Financials CXENSE 2016 | Q2 2016 results www.cxense.com
Personalization and Data Management drives growth Revenue USD million +79% 7,0 6,33 6,26 • 79% y / y revenue growth 6,06 Ad Network / 6,0 0,8 0,9 Programmatic 0,8 • Strongest demand for our Personalization and 4,82 5,0 Data Management software Advertising 1,4 • 1,9 0,6 145% y/y growth Software 1,8 4,0 3,54 • Disappointing recent churn rate on legacy 0,6 1,9 3,0 Maxifier contracts Personalization • The relative size of this segment is 1,3 and Data decreasing - thus, the revenue base is 2,0 3,9 Management more solid than one year ago 3,6 3,4 software 2,3 1,0 1,6 0,0 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Ad Network / Programmatic = The PCAN segment CXENSE 2016 | Q2 2016 results www.cxense.com Advertising Software and Personalization and Data Management = The SaaS segment
SaaS model drives organic growth USD 1,000 Annualized Recurring Revenue (ARR) on contracts closed in the quarter New ARR effect in reported figures Lost ARR (churn) 3 000 2 652 2548 2 441 Statistics last four quarters: 2 500 2 000 1 784 1 716 1672 1 650 1580 1 536 • Closed New ARR (Annualized 1 476 1 404 1 500 1 320 Recurring Revenue) of USD 7.4 million 1158 1 084 1 100 964 1 000 • Lost ARR (churn) of USD -3.1 million 500 - • Net New ARR of USD 4.3 million (212) USD 0.9 (308) (500) million • (489) (520) 21% organic growth over total relates to (648) One large legacy revenue in the period (1 000) acquired (892) Maxifier adserving contracts customer (1 500) (1 438) (1 668) (2 000) Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 CXENSE 2016 | Q2 2016 results www.cxense.com
Continued high sales in Q2 2016 41 # of new SaaS contracts 37 37 New contracts per quarter 35 34 Q2 2016 contract statistics: 31 31 • 35 new contracts 22 21 • 22 on new customers 14 • 13 up-sell on existing customers 11 11 11 7 • Record high average contract size of USD 73k Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 CXENSE 2016 | Q2 2016 results www.cxense.com
High gross margin Quarterly gross margin Percent Group SaaS segment PCAN segment • Organic growth within SaaS segment contributes to profitability growth through high gross margins 85% 83% 83% 82% 78% • Stable high SaaS segment gross margin over time 77% 76% 75% 73% 69% • The PCAN segment with lower gross margin but higher revenue growth as they now expand within Programmatic advertising 24% 22% 22% 19% 18% Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 CXENSE 2016 | Q2 2016 results www.cxense.com
Transformation and focus Quarterly group OPEX USD million A stronger Cxense has come out of the post acquisition OPEX OPEX adjusted 8,0 integration: 6,69 7,0 6,19 6,09 5,90 • 79% y/y revenue growth – but only 24% adjusted 5,78 5,70 6,0 5,52 5,51 5,26 OPEX increase 5,0 4,62 4,0 • A more robust US growth platform 3,0 2,0 • 70 R&D FTEs vs 40 one year ago • Working efficiently out of fewer locations and on 1,0 a more Personalization and Data Management 0,0 driven roadmap Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Acqusition of Maxifier and Ramp Integration CXENSE 2016 | Q2 2016 results www.cxense.com
EBITDA improvement continues USD million Revenues EBITDA 8,0 6,3 6,3 6,1 • 6,0 Q2 2016 EBITDA reflects completion of the planned post-acquisition restructuring 4,8 4,0 3,5 • EBITDA adjusted for one-off restructuring costs and share-based 2,0 employee costs was USD -1.1 million 0,0 (1,3) (1,4) -2,0 (2,0) (2,1) (3,1) -4,0 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 CXENSE 2016 | Q2 2016 results www.cxense.com
Cash on hand to pursue growth Q2 2016 cash flow USD 1,000 18 090 Strong cash position following private placement 19 169 • We will increase organic growth and future scalability potential through sales organization increase • Pursue selected acquisition opportunities (1 534) 3 072 • Will lead to higher OPEX and postpone EBITDA (459) break even target beyond 2016 Cash at Net cash Net cash Net cash Cash at • Will maintain strict focus on cost, efficiency and period start from from from period end profitability operations financing financing activities activities CXENSE 2016 | Q2 2016 results www.cxense.com
Sales CXENSE 2016 | Q2 2016 results www.cxense.com
Consumers want personalization Users increasingly expects a personalized experience across devices Personalization is becoming a key strategy to succeed in digital, across multiple verticals Cxense has the leading personalization software in the market which enables companies to tailor content, ads and promotions to the individual user CXENSE 2016 | Q2 2016 results www.cxense.com
Cxense delivers the leading personalization software in a market that grows Key recent new clients Nissen Co. – a leading online and catalogue retailer in Japan chose Cxense to deliver a more personalized shopping experience for their visitors Le Télégramme – a leading French regional publisher signed with Cxense after a thorough RFP process. Our first large win in France within Publishing. Aller Media AS – part of one of Nordic region’s leading media companies chose Cxense as their technology partner in the race for consumer attention and advertising spend. CXENSE 2016 | Q2 2016 results www.cxense.com
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