imimobile plc...goodwill from impact mobile acquisition working capital movement from organic growth...
TRANSCRIPT
| Jay Patel Group Chief Executive Officer
| Mike Jefferies Group Chief Financial Officer
IMImobile PLCPreliminary Results Year Ended 31st March 2019
Unaudited Preliminary Results Year End March 2019
A global communications software and solutions provider
2
Who we are What we do Who we do it for
We provide cloud communications software that
enables enterprises to automate digital customer
interactions to improve customer experience and
reduce costs.
Our software enable businesses to build and
launch new customer journeys up to 10x faster
than traditional development methods.
2000 Founded with mobile-first vision
2014 Listed on London Stock Exchange’s AIM market
1100 Global employees
20 Offices - London HQ, Toronto, Joburg, Dubai etc.
7 Successful acquisitions since IPO
1 Market leader in UK, Canada and South Africa
Business split Key financials
▪ Organic recurring revenue growth for 16 years
▪ Management shareholding: 15.6%
5-year
revenue CAGR 5-year gross
profit CAGR 5-year adjusted
EBITDA CAGR
27% 18% 20%
Regional split Business model Approx. Sector split
Top 12 customers 39% Gross Profit
Unaudited Preliminary Results Year End March 2019
Investment highlights
3
Structural growth
opportunity
Ideally positioned to
benefit from structural
long-term trends
towards digital
communications and
automation.
A market leader with
global presence and
blue chip client list
established over many
years.
Broad product offering
with our own IP and
proven ability to innovate
and capitalise on fast
moving technology trends.
Consistent track record
of profitable, organic and
cash generative growth
based on recurring
revenue business model
and successful M&A.
Global management team
with deep commercial,
technical and sector
experience.
Track record of
growthOwn IP and
R&D investment
Market leader Experienced
management
Unaudited Preliminary Results Year End March 2019
FY 2019 results – good momentum and strategic progress
▪ Strong organic growth from Europe & Americas, APAC and enterprise business
in South Africa
▪ 40 clients over £500k p.a. revenue (33 in FY18) and 83 clients between £100k-
500k p.a. revenue (43 in FY18)
▪ Enhanced operating leverage benefitting from past investment in partnerships
and R&D, with EBITDA margin up to 28.8%.
▪ New communications channels launched to enhance Enterprise CPaaS offering
▪ Considerable progress made with partners including BT, Telia, Salesforce
▪ Good progress made in North America though acquisition of Impact Mobile
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Financial highlights
Operational highlights
▪ Revenue increased 28% to £142.7m of which 17% is organic
▪ Gross profit increased 23% to £62.6m of which 7% is organic
▪ Exc. one specific customer this would be 14% organic
▪ Adjusted EBITDA increased 35% to £18.0m
▪ Adjusted profit after tax increased 40% to £10.9m
▪ Adjusted cash generated from operations increased 47% to £16.9m
30.0
36.5
43.5
50.7
62.6
FY15 FY16 FY17 FY18 FY19
Gross Profit (£m)
9.2
10.711.5
13.5
18.0
FY15 FY16 FY17 FY18 FY19
Adjusted EBITDA (£m)
Financial review
Unaudited Preliminary Results Year End March 2019
Commercial model
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Volume of e-mail, SMS, MMS,
push notifications, sessions etc.Licences & one-off
professional services
Contracted
revenues
25% 45% 20% 10%Fixed fees Usage based Transactional Non
recurring
Monthly Recurring Revenue(MRR)
Gross Profit Split*
Fees based on
revenue transactions
~90%
*Indicative gross profit split
Unaudited Preliminary Results Year End March 2019
Adjusted trading performance
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Year endedMar-19
£m
Mar-18
£m
Growth
%
Revenue 142.7 111.4 +28%
Gross profit 62.6 50.7 +23%
Administrative expenses
(excluding D&A)(44.6) (37.3) +19%
Adjusted EBITDA 18.0 13.4 +35%
EBITDA margin* 28.8% 26.4%
Profit before tax 13.7 10.1 +36%
Diluted EPS 15.1p 11.2p +35%
*EBITDA Margin = EBITDA/Gross profit
Gross profit split
Unaudited Preliminary Results Year End March 2019
Regional overviews
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Europe & Americas | 71% of gross profit APAC | 14% of gross profit
MEA | 15% of gross profit ▪ Year on year gross profit growth of 43% (16% organic)
▪ New contract wins across core sectors include cross-selling to customers
of Textlocal and IMImobile Intelligent Networks
▪ Working with 3 major UK mobile operators, 3 of the top 5 banking groups,
4 of the 6 leading utilities and 2 of the largest logistics providers
▪ Partnership progress with BT, Telia & Salesforce
▪ Renewed key contracts in US and appointed North American CEO
▪ Strong organic gross profit growth of 14% on a constant currency basis
▪ Good growth for Textlocal India
▪ Enterprise business in SA delivered strong organic gross profit growth of 20%
▪ Headwinds with one specific customer
FY15 FY16 FY17 FY18 FY19
MRR License & professional services
16.419.9
22.9
31.3
FY15 FY16 FY17 FY18 FY19
MRR License & professional services
5.0 5.3
7.0
8.2 8.8
44.7
8.6
11.3
13.5
11.2
9.1
FY15 FY16 FY17 FY18 FY19
MRR License & professional services MTN
Unaudited Preliminary Results Year End March 2019
Balance sheet
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AssetsMar-19
£m
Mar-18
£m
Cash
Trade receivables
Pass through revenues
Other current assets
13.2
41.2
3.3
6.2
15.7
28.8
5.2
6.1
Current assets 63.9 55.8
Goodwill
Acquired intangibles
Other intangible assets
PPE
Other non-current assets
43.6
16.8
12.8
4.3
0.6
33.3
9.7
10.7
4.6
0.5
Non-current assets 78.1 58.8
Total assets 142.0 114.6
Net Assets 60.1 54.2
Goodwill from Impact Mobile acquisition
Working capital movement from organic
growth and Impact Mobile acquisition
Bank debt of £20.7m
LiabilitiesMar-19
£m
Mar-18
£m
Trade payables and accruals
Pass through revenues
Other current liabilities
34.1
5.1
18.6
27.6
5.7
12.7
Current liabilities 57.8 46.0
Non-current liabilities 24.1 14.4
Total liabilities 81.9 60.4
Unaudited Preliminary Results Year End March 2019
Further capacity for debt for future
M&A
Adjusted cashflow
10
Year toMar-19
£m
Mar-18
£m
Cash generated from operations 16.9 11.5
Net cash from operations 15.6 10.3
Investing activities (28.5) (18.4)
Financing activities 10.6 11.0
Cash and cash equivalents at
beginning of period15.7 14.7
Foreign exchange on opening
balances(0.2) (1.9)
Cash and cash equivalents at end
of period13.2 15.7
Net debt of £7.5m
Cash generated from operations over
the last four years of over £50m (95%
conversion)
Cash conversion of 94%
Market opportunity & positioning
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.
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Backend IT – Getting your house in order
Core Business Systems – Process efficiency
CRM – Knowing your customer
Early 1980s to 1990s
1990s to 2000
2000 to 2015
Customer experience is the new battleground for business growth
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2015 onwards CX – The new frontier
Forrester says that 72% of decision makers at large enterprises have
improving CX as a top priority.Gartner revealed that, today, 89% companies compete primarily on
basis of customer experience.
Shift from ‘business-owned’ channels to ‘consumer preferred’
Shift from point and click to natural language conversations
Shift from reactive to proactive
Shift from manual to automated
Focus from customer acquisition to customer service and retention
Digital natives have reshaped consumer CX expectations
Only 12% millennials cite telephone as their favourite communication channel.
82% businesses already using or planning to use chatbots by 2020 for
consumer-facing products.
87% consumers want to be contacted proactively by a company for customer
service matters.
85% customer service interactions will be fully automated by 2020.
96% consumers say customer service is an important factor in their
choice of loyalty to a brand.
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The challenges businesses face to delivering a great CX
CORE BUSINESS SYSTEMS
3 rd PARTY SERVICES
TRANSACTION PROCESSING
FRAUD MANAGEMENT
CRM PLATFORM
CASE MANAGEMENT
COMMERCE PLATFORM
BILLING PLATFORM
APPOINTMENT MANAGEMENT
DELIVERY / FULFILMENT
ADDRESS VERIFICATION
CREDIT CHECK
PAYMENTS
APP
2
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CIOs state that the integration of
new channels with legacy systems
was a key CX challenge.92%
82%Fear that an inability to automate
customer journeys end to end will lead
their business to fall behind.
2Most common challenges for CIOs
are data spread across different
systems & legacy technology.
88%CIOs find keeping customer
communications compliant a
challenge.
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How does a business overcome these challenges?
Invest in a centralised communications platform
Develop an in-house solution
Use a systems integrator(SI)
▪ Lengthy development cycles
▪ Developer skills gap▪ Continual updates and
management
▪ Lots of different vendors and difficulty in stitching them all together
▪ Costly investment
▪ End-to-end customer journey automation
▪ Shorter development cycles
▪ Enterprise-grade controls
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We power mission critical communications for large enterprises
Parcel delivery notifications over
SMS and email
30 million+ per month
Proactive customer journeys
(meter-readings, appointments,
emergency alerts)
Integrated multichannel
communications (IMCC)
20+ Communication Services
GDPR marketing consent
management ~21m records
Omni-channel enablement
for Customer Service
Automated parcel alerts with
intelligent routing
Actionable last mile delivery
alerts with link to live chat
Largest UK
logistics company
Global home
furniture
retailer
Our CX automation product suite
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We provide a customer communications platform and applicationsthat enable businesses to intelligently create, manage and automate
end to end digital customer interactions.
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
APP
2
Supplying customer communications channels is only part of the solution
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
APP2
CRM PLATFORM
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Integration set-
up
& management
Business Logic &
flow
orchestration
NLP & AI
powered
conversational
Automation
Communications
channel
management
Intelligent enterprise control
Service assurance &
infrastructure management
Integration set-
up
& management
Business Logic &
flow
orchestration
NLP & AI
powered
conversational
automation
Communications
channel
management
Intelligent enterprise control centre
Service assurance &
infrastructure management
Enterprise CPaaS vs Developer CPaaS
Growth strategy
Unaudited Preliminary Results Year End March 2019 2222
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
+ +
Established track record of performance since IPO
5-year revenue CAGR of 27%
RCS
Track record of 7
acquisitions since IPO in
2014
Unaudited Preliminary Results Year End March 2019
Delivering against our consistent growth strategy
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1. Grow share of interactions with existing accounts
40 customers with over £500k
p.a. revenue 83 customers
between £100k - £500k p.a.
revenue(33 over £500k and 43 between £100k-
£500k in FY18)
Case study – UK Tier 1 Telecom provider
< £1M SaaS fees
(contracted)
> £1M SaaS fees
(contracted)
Mark
etin
g
Au
tom
atio
n
Back-end System
Integration
Ad-hoc
Marketing
Campaigns
Email Marketing
Campaigns
Multi-channel
Campaign
Management
Event triggered
customer journey
orchestration
2019
2021
2016
2018
2015
2014
Account Growth (p.a.)
< £100K projects
£100-500K projects
Unaudited Preliminary Results Year End March 2019
Delivering against our consistent growth strategy
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1. Grow share of interactions with existing accounts
2. Accelerate market penetration through partnerships
By working closely with IMImobile we can innovate to meet the growing
demand from customers who prefer to communicate with businesses over
more interactive channels. As the world keeps changing,
we need to stay relevant for our customers and
IMImobile’s products help to enable that.
Jon Christian Hillestad, VP Business at Telia Norway
“
”
BT Cloud Contact Notify
IMIconnect is resold as
BT Cloud Contact notify
Unaudited Preliminary Results Year End March 2019
Delivering against our consistent growth strategy
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1. Grow share of interactions with existing accounts
2. Accelerate market penetration through partnerships
3. Introducing new customer engagement technologies
Location finder for petrol stations
Returns management
Official technology partner for Apple Business Chat, Google RCS Business Messaging & WhatsApp Business.
Early trials for RCS have seen improved engagement rates.
- US retail pharmaceutical company experienced 33% more opt ins to their loyalty program using RCS vs SMS.
- UK Telco launched RCS campaign with 25% engagement rate.
Launched first WhatsApp Business solution for FMCG client in India.
Launched Apple Business Chat with npower for their smart meter roll out initiative.
Unaudited Preliminary Results Year End March 2019
Delivering against our consistent growth strategy
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1. Grow share of interactions with existing accounts
2. Accelerate market penetration through partnerships
3. Introducing new customer engagement technologies
IMIassist: providing real time video customer service assistance
Unaudited Preliminary Results Year End March 2019
Delivering against our consistent growth strategy
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1. Grow share of interactions with existing accounts
2. Accelerate market penetration through partnerships
3. Introducing new customer engagement technologies
4. Leverage acquisitions for market distribution
2014: UK & India market
leader for SMB Messaging
Services
2015: Market leader for
mobile banking services in
SA
2017: Leading provider of
multi-channel messaging
and routing middleware
2017: UK market leader for
Appointment and Patient
Experiences
2018: Canada’s leading
provider of mobile
engagement solutions
2017: Leading US mobile
messaging and engagement
platform
Summary & outlook
Unaudited Preliminary Results Year End March 2019
▪ Momentum in customer communications sector for greater use of digital channels and
more automation
▪ Global opportunity to be category leader
▪ Established client relationships, pipeline of new deployments and high proportion of
recurring revenues provide great foundation for further growth
▪ Continuing investment in partnerships and new customer engagement technologies
▪ FY20 started well with trading in line with expectations
Summary & outlook
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Unaudited Preliminary Results Year End March 2019
Thank you
Appendices
Unaudited Preliminary Results Year End March 2019 32
Global client list FY19
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Significant clients with billing of >£100k revenue
Unaudited Preliminary Results Year End March 2019
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