imimobile plc€¦ · 2000 founded with mobile-first vision 2014 listed on london stock...
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| Jay Patel Group Chief Executive Officer
| Mike Jefferies Group Chief Financial Officer
IMImobile PLCPreliminary Results Year Ended 31st March 2020
We believe that technology has and will continue to fundamentally change how businesses engage with their customers.
New communications channels and the possibilities of intelligent automation will allow businesses to improve customer experience and reduce costs.
We help our clients do this with our market-leading, customer interaction management suite.
A global communications software and solutions provider
3
Who we are What we do Who we do it for
We provide a customer interaction management suite that enables enterprises to automate customer communications to improve CX and reduce costs.
We have market leading software and our platform and applications work together and integrate with third-party suppliers to provide end-to-end automation of customer interactions.
Business split* Key financials
Organic recurring revenue growth for 17 years
Management shareholding: 13%
6-year revenue CAGR
6-year gross profit CAGR
6-year adjusted EBITDA CAGR
26% 19% 20%
Regional split Sector split
2000 Founded with mobile-first vision
2014 Listed on London Stock Exchange’s AIM market
1100 Global employees
20 Offices - London HQ, Boca Raton, Joburg, Dubai
9 Successful acquisitions since IPO
1 Market leader in UK, Canada and South Africa
2019 Acquisition of 3C, a global leader in RCS
3%
2%2%
1%
IMImobile - Preliminary Results Year End March 2020
Divisional split
*All approximate gross profit splits
IMImobile - Preliminary Results Year End March 2020 4
Double-digit growth across all sectors and regions for cloud communication products
15% organic gross profit growth across 82% of the business
4-year organic gross profit CAGR of 16% for cloud communications products
Strong momentum in North America, the Company’s biggest potential growth market
Strong period of new client wins, partnership agreements and contract renewals
Resilient performance in Q1 FY21, despite challenges of COVID-19, with gross profit up approximately 20% year-on-year for the quarter
Strong trading performance for FY20
IMImobile - Preliminary Results Year End March 2020
COVID-19 impact
Management response
Opportunities
Volumes and activity levels in core sectors (Banking, Mobile Operator, Logistics) counteracted sectors most affected by the pandemic (Healthcare, SMB and Retail)
Started to see steady recovery in activity of clients in worst affected sectors
Long term positive impact expected, accelerating need for businesses to effectively communicate with customers
Rolled out crisis communications solutions for employee, customer and citizen engagement:
- Emergency broadcast alerts
- Remote contact centres
- IVR call deflection
- Video consultation solutions
5
Mitigated short term impact, with long term positive impact expected
All 1,100 employees transitioned to remote working in a few days
Early internal measures introduced included hiring freeze, travel restrictions and temporary salary reductions
Successful fundraise ensured safeguarding of financial flexibility
Following good Q1 performance, reversed a number of internal measures, including salary reductions, except for the Board
Started to return furloughed employees to the business since 1st July
We have always felt like a number of our patients do not actually need to come to the clinic. During the pandemic, having a service like eClinic has become a necessity.
“
”Dr Muhammad Javed, CCIO at Walsall Healthcare NHS Trust
Financial review
IMImobile - Preliminary Results Year End March 2020
Strong growth in all financial metrics
7
Year ended(adjusted results)
Mar-20£m
Mar-19£m
Growth%
Revenue 171.2 142.7 +20%
Gross profit 79.1 62.6 +26%
Administrative expenses (excluding D&A)
(57.5) (43.5) +32%
EBITDA 21.6 19.1 +13%
EBITDA margin* 27.3% 30.5%
Profit after tax 12.3 10.8 +14%
Adjusted diluted EPS 15.5p 15.1p +3%
Cash & cash equivalents 25.1 13.2 +89%
6-year RevenueCAGR
6-year Gross profit
CAGR
6-year EBITDA CAGR
+19%
+20%
+26%
*EBITDA margin = EBITDA/Gross Profit
IMImobile - Preliminary Results Year End March 2020
Strong balance sheet
8
AssetsMar-20
£mMar-19
£m
CashTrade receivablesPass through revenuesOther current assets
25.138.2
2.09.4
13.241.3
3.36.1
Current assets 74.7 63.9
GoodwillAcquired intangiblesOther intangible assetsPPEOther non-current assets
70.036.516.9
6.50.7
43.616.413.2
4.30.6
Non-current assets 130.6 78.1
Total assets 205.3 142.0
Net assets 78.7 60.1
Goodwill and bank borrowings increased for 3C and Rostrvm acquisitions
LiabilitiesMar-20
£mMar-19
£m
Trade payables and accrualsPass through revenuesOther current liabilities
45.44.4
19.5
40.65.1
12.1
Current liabilities 69.3 57.8
Non-current liabilities 57.3 24.1
Total liabilities 126.6 81.9
Post-period end placing of £21.7m strengthened financial position
IMImobile - Preliminary Results Year End March 2020
High levels of cash conversion
9
Year toMar-20
£mMar-19
£m
Cash generated from operations 20.9 15.9
Net cash from operations 18.3 14.6
Investing activities (49.2) (27.5)
Financing activities 42.8 10.6
Cash and cash equivalents at beginning of period
13.2 15.7
Foreign exchange on opening balances
0.0 (0.2)
Cash and cash equivalents at end of period
25.1 13.2
End of period bank debt (47.3) (20.7)
Strong adjusted cash conversion of 111%
Net cash* of £2.0m as at 30 June 2020 following post-period end placing
Net debt* of £22.2m
Cash generated from operations of more than £70m in the last five years (>95%)
*Excludes operating leases
IMImobile - Preliminary Results Year End March 2020
Business split
10
Year toMar-20
£mMar-19
£mGrowth
%
Revenue 150.9 120.0 26%
Gross profit 64.5 46.7 38%
Europe 37.8 33.3 13%
Americas 18.4 7.3 152%
APAC 4.0 2.8 45%
MEA 4.4 3.4 29%
Adjusted EBITDA* 22.8 - -
Year toMar-20
£mMar-19
£mGrowth
%
Revenue 20.3 22.7 (11%)
Gross profit 14.6 15.8 (8%)
Europe 2.6 4.0 (35%)
Americas 1.1 0.1 1626%
APAC 6.0 6.0 (1%)
MEA 4.9 5.7 (14%)
Adjusted EBITDA* 1.1 - -
Cloud Communications Products (82%)
Operator VAS & Payments (18%)
Sector split
Sector split Gross profit split
Gross profit split
10
*Adjusted EBITDA excludes central costs
IMImobile - Preliminary Results Year End March 2020
Cloud Communications Products
IMImobile - Preliminary Results Year End March 2020
Our customer interaction management suite
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CORE BUSINESS SYSTEMS
3rd PARTY SERVICES
TRANSACTION PROCESSING
FRAUD MANAGEMENT
CASE MANAGEMENT
COMMERCE PLATFORM
BILLING PLATFORM
APPOINTMENT MANAGEMENT
DELIVERY / FULFILMENT
NAME / ADDRESS VERIFICATION
CREDIT CHECK
PAYMENTS
CRM PLATFORM
APP2
Enterprise CPaaS platform
Integration set-up
& management
Business logic & flow
orchestration
NLP & AI powered
conversationalautomation
Communicationchannel
management
Intelligent enterprise control
Service assurance & infrastructure management
Business applications
IMImobile - Preliminary Results Year End March 2020
Established market opportunity
Marketing Product/IT
Support
o Marketers must move beyond traditional campaigns to orchestrate always-on, continuous engagement
o Customers want consistency and relevance across all touchpoints
o Customers want to interact with businesses on their terms using their favourite communications channels
o Companies must understand the need to align marketing with sales, service, and eCommerce to deliver better customer experiences
o The CPaaS market is forecasted to grow from $3.3bn in 2018 to $17.2bn in 2023
o RTIM marketing is forecasted to grow at a CAGR of 13.2% through 2023
o CCaaS solutions are growing at a CAGR of 27.7%
IMImobile’s customer interaction management suite sits at the
intersection between these three core business areas
Legacy platforms not mobile-first
Fragmented use of dataRich personalised
campaigns
Legacy platformsBespoke one-way
solutionsRigid processes
Reactive resourceAccess to limited legacy systems
Responding “after the event”
13
IMImobile - Preliminary Results Year End March 2020 14
Cloud communications overview – Europe
The AA The AA The AA The AA The AA
Revenue £107.0m (2019: £94.9m)
Gross profit £37.7m (2019: £33.8m);
12% organic gross profit growth
Gross margin 35.3% (2019: 35.6%)
FinancialsOperational highlights
Growth driven by new client wins and cross selling to existing accounts of additional cloud communications products
New client wins across banking, utilities, public sector & leisure provide foundations for future growth
Healthcare division signed 11 new NHS trusts and launched new eClinicproduct
Renewed significant contract with Spanish mobile operator & progress in mainland Europe
Signed new partnerships with telecom and business services companies
Launched RCS campaigns for three major UK operators & Apple Business Chat for major high street bank
FY16 FY17 FY18 FY19 FY20
MRR NRR
Gross Profit (£m)
15.918.2
27.3
33.8
37.7
IMImobile - Preliminary Results Year End March 2020 15
Cloud communications overview – Americas
The AA
Revenue £25.8m (2019: £10.5m)
Gross profit £18.4m (2019: £7.3m)
10% organic gross profit growth
Gross margin 71.2% (2019: 69.3%)
FinancialsOperational highlights
Organically won large US retail client for CPaaS offering
Selected through competitive tender process
Emergency COVID-19 communications deployed
First phase of project successfully delivered in July
Validated relevance of Group product set in the market
Acquired established mobile marketing business, 3Cinteractive (3C) in August 2019
100+ employees based in Boca Raton, Florida
Blue chip client list
Integration substantially complete
Created one North American organisation (c.140 employees)
FY16 FY17 FY18 FY19 FY20
MRR NRR
Gross Profit (£m)
0.81.3 1.6
7.3
18.4
IMImobile - Preliminary Results Year End March 2020
Strategy and growth in North America
Progress to date
Held 20 workshops with 3C customers
11 opportunities identified
4 now in deployment
Substantial new logo wins
Retail, financial services & hospitality sectors
Competitive tender processes
Underpins confidence in core proposition
Limited US market changes necessary for technology
IMIconnect, IMIchat & IMIcampaign successfully deployed
Other products currently in deployment
Growth strategy
Clear market opportunity identified and confirmed
Large enterprises with complex legacy infrastructure
Need for more than just communication APIs
Tender/workshop led procurement process
High touch account management
Market leading innovation
Global leader in RCS Business Messaging
Ready to scale
Investment in brand awareness
Investment in sales and marketing
Investment in analyst recognition
Rather than the usual catalogue of SDKs and APIs, the company is focused around end-to-end automation of customer journeys across digital touchpoints. Commented a leading industry analyst
“
”16
IMImobile - Preliminary Results Year End March 2020 17
FY16 FY17 FY18 FY19 FY20
MRR NRR
1.5
3.43.0
3.4
Cloud communications overview – MEA and APAC
Middle East & Africa Asia PacificGross Profit £4.4m (2019: £3.4m) Gross Profit £4.0m (2019: £2.8m)
Solid trading performance enhanced by growth of new messaging channels and automation technologies
New contract wins across banking, mobile operator and utilities sectors
Gross Profit (£m) Gross Profit (£m)
4.4
FY16 FY17 FY18 FY19 FY20
MRR NRR
0.81.2
2.42.8
4.0
Momentum in the region for WhatsApp Business channel
Onboarded clients across automotive, retail & banking sectors
IMImobile - Preliminary Results Year End March 2020 18
Consistent growth strategy
1 2 3 4
Accelerate market penetration through
partnerships
Grow our share of interactions with existing accounts
Introducing new innovative customer
engagement technologies
Leverage acquisitions for market distribution
+ +
46 customers over £500k p.a. revenue (PY: 40)
118 customers between £100k - £500k p.a. revenue
(PY: 83)
IMImobile - Preliminary Results Year End March 2020 19
New communications channels starting to gain momentum
WhatsApp for Mercedes-Benz
Apple Business Chat for Barclays
RCS for Vivo Brazil
Global market leader for RCS Business Messaging
Launched world’s largest RCS campaign during period
Verified technology partner of Google, Apple and Facebook
Launched Apple Business Chat for first major UK bank
WhatsApp services launched for leading automotive providers –Hyundai, Mercedes-Benz, Toyota
Large enterprises starting to see the effectiveness of new communications channels
IMImobile - Preliminary Results Year End March 2020
Operator VAS & Payments
IMImobile - Preliminary Results Year End March 2020 21
Product set
IMIdigital is a content management platform delivering digital content services and self-care customer portals for mobile operators.
Tap2Bill is a Trusted Payment Intermediary (TPI) processing API and SMS based payments charged to users mobile bills or deducted from PAYG credit, on behalf of charities and e-commerce brands.
IMImobile - Preliminary Results Year End March 2020 22
Operator VAS & payments overview
The AA
Revenue £20.3m (2019: £22.2m)
Gross profit £14.6m (2019: £15.8m)
Gross margin 71.8% (2019: 69.0%)
FinancialsOperational highlights
Experienced a decline of 8% in line with management expectations
Gross profit from the UK payments business fell from £3.5m to £2.6m – due to regulations and changes in consumer habits
Gross profit flat in APAC at £6.0m – growth from usage of IMIdigitalfor self-care applications for mobile operator portals offset the one-off licence fees achieved last year
Gross profit in MEA fell from £5.7m to £4.9m - due to continued decline in market for certain content services
Long term trusted relationships with leading telecom groups provides foundations for future growth
FY16 FY17 FY18 FY19 FY20
MRR NRR
Gross Profit (£m)
17.519.2
16.4 15.8
14.6
Summary & outlook
IMImobile - Preliminary Results Year End March 2020
Resilient performance delivered so far post-period end: Group gross profit up approximately 20% year-on-year
Cloud communications products gross profit up 30% year-on-year, driven by 3C acquisition
Positive momentum on strategic deployments and new contract wins
Encouraging performance in North America, developing sales and marketing initiatives in the region
Uncertainty around the economic impact of the pandemic remains, however we are reassured by the substantial opportunities open to the Group
We believe the pandemic will drive and accelerate uptake of digital transformation and therefore demand for our solutions
Summary & outlook
24
IMImobile - Preliminary Results Year End March 2020
Investment case
25
Structural growth opportunity
Track record of growth
Own IP and R&D investment
Market leader Experienced management
>85% senior management team with over 10 years sector
experience(SVP level and above)
"The enhanced functionalities of RCS will
lead to a nearly sixfoldincrease over the next five years for messages that
businesses send to consumers”
17 years of organic recurring
revenue growth
No. 1 UK, South Africa, Canada
Top 5 Providers in the US
IMImobile - Preliminary Results Year End March 2020
Questions
Appendices
IMImobile - Preliminary Results Year End March 2020 28
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Significant clients with billing of >£100k revenue
Global client list FY20
IMImobile - Preliminary Results Year End March 2020
An experienced management team
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Jay PatelGroup CEO
18 years with IMImobile
25+ years of Technology, Media & Telecom experience with BSkyB, UBS Warburg, Spark Ventures
Chartered Accountant with KPMG and MBA from INSEAD
Mike JefferiesGroup CFO
9 years at IMImobile
Executive position at WIN PLC and formerly with the Whirlpool Corporation
Chartered Management Accountant
Vishwanath AlluriFounder & Non-Executive Director
Extensive experience in creating technology companies
Chartered Accountant & Company Secretary
Shyam BhatFounder & Group CTO
Engineer from highly prestigious Indian Institute of Technology, Bombay
30+ years in engineering & new product developments
John AllwoodNon-Executive Chairman
Ex Chief Executive of Orange UK
Ex Chief Executive of Mirror Group plc of
Non-Executive Director of TalkTalk
Simon Blagden CBENon-Executive Director
25+ years experience in telecoms & IT industry
Non-Executive Chairman Fujitsu UK
Chairman Duke of York’s Community Initiative charity
IMImobile - Preliminary Results Year End March 2020
Quality of earnings
30
Volume of e-mail, SMS, MMS, push notification, sessions etc.
Licences & one-off
prof. services
Contracted revenues
Fixed fees Usage based Transactional Non recurring
c.90% Monthly Recurring Revenue
(MRR)
Fees based on
revenue transactions
Impact of capitalisation and amortisation
Well diversified
Approximate gross profit split
Longstanding customer relationships
25% 50% 15% 10%
Average customer tenure
Top 10customers
Top 20customers
Percentage of gross profit
9.9 years
8.5 years
31%
45%
9.0 9.0
7.3
10.1 9.8
6.9
13.613.1
11.2
14.613.9
13.3
PBT as reported 7 yr amortisation PBT assuming 5 yr amortisation EBITDA less interest and capex
FY17 FY18 FY19 FY20
FY19
Gross profit split (by region)
FY20
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