A global Leader in Voice Technology Solutions that Brings Android, Wi-Fi & VoIP Together
May 2016 Apivio Systems Inc. (APV.V)
www.apivio.com
A global Leader in Voice Technology Solutions that Brings Android, - - PowerPoint PPT Presentation
A global Leader in Voice Technology Solutions that Brings Android, Wi-Fi & VoIP Together May 2016 Apivio Systems Inc. (APV.V) www.apivio.com DISCLAIMER THIS PRESENTATION HAS BEEN PREPARED BY APIVIO SYSTEMS INC. (THE COMPANY) SOLELY
May 2016 Apivio Systems Inc. (APV.V)
www.apivio.com
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THIS PRESENTATION HAS BEEN PREPARED BY APIVIO SYSTEMS INC. (THE “COMPANY”) SOLELY AS AN INTRODUCTION TO THE COMPANY AND ITS TECHNOLOGY. This Presentation is the sole responsibility of the Company. Information contained herein does not purport to be complete and is subject to certain qualifications and assumptions and should not be relied upon for the purposes of making an investment in the securities or entering into any transaction. The information and opinions contained in the Presentation are provided as at the date of this Presentation and are subject to change without notice and, in furnishing the Presentation, the Company does not undertake or agree to any obligation to provide recipients with access to any additional information or to update or correct the Presentation. No stock exchange, securities commission or similar regulatory authority has passed on the merits of any securities referred to in the Presentation, nor has it passed on or reviewed the Presentation. The Company is developing a new and unproven technology. It is subject to a large number of very significant challenges including the risk that no viable product will ever be developed and even if one is developed there is the risk that no market will exist for it. The Company is competing against companies with much greater resources and the Company’s continued existence is dependent on its ability to secure additional financing. The Presentation may contain “forward looking information” within the meaning of applicable Canadian Securities legislation concerning, among other things, the size of the market for potential applications of the Company’s technology and the timing of further technical development of the Company’s projects. There can be no assurance that the plans, intentions or expectations upon which these forward looking statements and information are based will occur. “Forward looking statements” and “forward looking information” are subject to a variety of risks, uncertainties and assumptions, including those discussed in the annual Management Discussion and Analysis and under “Risk Factors” in the Company’s public filings at www.sedar.com. Some of the factors which could affect future results and could cause results to differ materially from those expressed in the forward looking statements and information contained herein include: Risk of technological non-feasibility, obsolescence and inadequate economics, dependence on key personnel and key relationships with the Company’s technology licensor. Forward-looking statements and information are based on the beliefs, estimates and opinions of management at the date the statements are made and are subject to change without notice. The Company does not undertake to update forward-looking statements or information if management believes estimates or opinions or other circumstances should change. The Company also cautions potential investors that investments in new technology are inherently risky.
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Highlighting Apivio as an Innovative Company Entrenched platform for high-margin, recurring revenue Android apps Collaborating with NEC to develop more apps
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Others
Market Share Distribution
Vendors Globally
* Nokia is undergoing an acquisition of Alcatel-Lucent * Mitel acquired Aastra in November, 2013
NEC sells more than 1.5 million phones annually NEC is the 3rd largest enterprise telephony vendor globally
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www.apivio.com Some UT880s displayed at NEC Advantage Resellers Conference this week UT880 apps are a priority
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Messaging and SMS. 2 lines for multiple phone numbers
Configurable by the CLive cloud Switch between on-prem and external settings
Call transfer to internal and external phones Paging and speakerphone
Anywhere Wi-Fi is available Not limited by charging station range
Use at home, office, airports, hotels Charge with USB cable, stand optional
No installation of phone jacks No wired ethernet ports
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More than 5 million phones sold Barrier to entry due to software customization 25%+ CAGR over last three years
519,509 700,402 799,978 924,213 1,072,164 2015 2014 2013 2012 2011 1,200,000 900,000 600,000 300,000
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www.apivio.com Promote Vertical Apps as the hook to sell Hardware
Offer the largest library of Apps for Android Enterprise phones Offer technical know how for their unique SiPs Develop an Eco System: App Store, User Groups, etc. State of the Art Android Desk Phones
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www.apivio.com Generate long term monthly revenue
Potentially Sell Hardware at Cost Provide Service as an Option State of the Art Cloud for Auto Provisioning, trouble shooting, Updates, etc. Innovative IP Phones (Android, Wi-Fi, etc.)
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$29,467 $35,039 $46,553 $59,990 $(5,466) $(66) $1,420 $2,120
$0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 Annual Revenue EBITDA
2012 2013 2014 2015
49% growth in last year 29% growth in last year
in '000s Canadian Dollars
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10% 15% 18% 18% 0% 5% 10% 15% 20% $0 $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 Gross Profit Gross Profit (%)
Gross Profit in 2015
in '000s Canadian Dollars
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($400) ($200) $0 $200 $400 $600 $800 $1,000 $1,200 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
in '000s Canadian Dollars
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$0 $2,000 $4,000 $6,000 $8,000 $10,000 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15 Cash Debt Net Cash
Stronger cash position after 7 quarters of positive EBITDA & financing in March 2015 Debt is flat despite increase in sales.
Stronger cash position after 7 quarters of positive EBITDA
Debt is flat despite increase in sales in '000s Canadian Dollars
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($4,000) ($2,000) $0 $2,000 $4,000 $6,000 $8,000 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
in '000s Canadian Dollars
Significant improvement in net working capital over the last two years
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10.86 9.74 3.13 2.73 2.86 2.51 2 4 6 8 10 12 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
0.92 1.01 1.26 1.32 1.36 1.5 0.5 0.7 0.9 1.1 1.3 1.5 1.7 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
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Moimstone Korea (000’s) 2014 2015 Revenue 46,415 59,694 EBITDA 1,643 2,814 Add back Head Office Management Fees 671 622 R&D for North American Products 1,003 2,111 Adjusted EBITDA 3,316 5,548 Adjusted EBITDA % 7.1% 9.3%
The Korean Subsidiary (“MK”) sells to Korean Tier-1 telephone carriers Korean business producing YoY revenue and EBITDA growth High barrier to entry due to customization done for Korean customers MK funds R&D on new products for Korean and North American markets
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Market Capitalization
Share Price (May 2, 2016) $0.34 Basic Shares Outstanding 52.8 Market Capitalization $18.0 Debt (as on Dec 31, 2015) ($6.8) Cash $5.5 Options proceeds $0 Enterprise Value $19.3
(amounts in C$ millions, except per share)
80 Employees in Canada and South Korea
Rob Bakshi CEO David Pais CFO 2015 Revenue/Employee $750K
C$M except for EPS 2015 2014 2013
Revenue $60 $46.6 $35
$2.1 $1.4 ($0.1) Cash $5.5 $1.8 $3.0 Debt $6.8 $7.5 $6.7 EPS $0.02 $0.00 ($0.06)
APV stock valuation…
Korean legacy business alone ~4x EV/EBITDA Entire company ~0.4x EV/Sales
Ticker: TSXV:APV
52 Week Hi/Low C$0.28/C$0.65 Insiders Own 21%
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ROB BAKSHI
built and sold businesses
Enterprises
DAVID PAIS
eleven years.
manufacturing company that was sold to a Boston based NYSE listed US Public company for $60M
Corporate Finance, specializing in M&A and financing
President & CEO CFO CEO, Moimstone Korea
head of Sales promoted to COO and then to CEO, Korea
and Logistics in several tech companies in Korea
University, International Business Professional course from Kotra
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including Dasan Networks, Dain Telecom, nSYSTech and Hanwha working on Switching systems, Semiconductors, VoIP & Wi-Fi and DSL solutions
Engineering from Korea University
accounting at Dansung Electron, Vodus and Kolon International
department
Business Administration from Konkuk University
CHANG IL AN
CTO, Moimstone Korea CFO, Moimstone Korea Executive Director - Sales
accounts and International Sales for Moimstone Korea
positions in Wareplus Co. and Wellink Co.
from Dong Seoul College
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Global NEC deployment High margin, recurring app revenue will improve business model and earnings profile Extend channel to include non- NEC dealers, service providers and phone companies
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Disrupting the VoIP phone market with a smart Android deskphone Global exclusive partnership with NEC Korean business generated $55M in revenue in ‘15, EBITDA positive and funds R&D for new products Low Valuation: ~4x EV/EBITDA of Korean biz or 0.4x revenue Named as Top 10 VoIP solution provider by Enterprise Telephony Magazine and on the Branham 300 list of Canada’s top 25 ICT companies 2016 TSX Venture 50 Company
Rob Bakshi, CEO
T: 604-761-2100 rbakshi@apivio.com
www.apivio.com
David Pais, CFO
T: 604-340-9866 dpais@apivio.com
Sean Peasgood, IR
T: 416-565-2805 sean@sophiccapital.com