B A S W A R E
Roadshow presentation June 2020
B A S W A R E Roadshow presentation June 2020 IMPORTANT NOTICE - - PowerPoint PPT Presentation
B A S W A R E Roadshow presentation June 2020 IMPORTANT NOTICE The follow owing infor ormation co conta tains, or or may be be de deemed to to cont ntain, n, for orwa ward rd-look oking state tement nts. These state tement nts
Roadshow presentation June 2020
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The follow
conta tains, or
be de deemed to to cont ntain, n, for
ward rd-look
tement
tement nts re relate te to to futur uture eve vent nts or
uture financ ncial perfor
nce, inc nclud uding, g, but ut not
ted to, expecta ctations re regard rding market gr growt wth and nd de deve velopment nt as as we well gr grow
th and nd profita tability ty of
ware
In som
cases, suc uch for
ward rd-look
tement nts ca can be be ide dent ntified by by te terminology gy suc uch as as “expect”, “plan”, “anticipate”, “intend”, “believe”, “estimate”, “predict”, “potential”, or
nega gati tive ve of
terms or
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By their na nature ture, for
ward rd-look
tement nts involve ve risks and nd unce ncerta rtaint nties becau cause th they re relate te to to eve vent nts and nd de depend on
circum umstance nces that may or
ur in in th the futur
uture re results may vary ry from the results exp xpre ressed in, or
rd-look
ng state tement nts, pos
to a mate terial de degre gree. All forw
rd-loo
tement nts inc nclude uded here rein are re based on
resently available to to Basware re and, d, acc ccordi rdingly, Basware re assumes no no obligation to to up update te any ny forw rward rd-loo
tate tement nts, unless obligate ted to to do do so so pur ursua uant nt to to an an applicable law law or
ulati tion. Not
in this pre resent ntation
nstitute tutes inve nvestm tment nt adv dvice ce and nd this pre resent ntation
not co constitute tute an an of
to sell or
solicitati tion of
an offer to to buy any secur uriti ties of
to engage in in any investment activity ty.
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EUR 148 million revenue in 2019
~1,325 employees
in 14 countries Customers in
100+ countries
comes from cloud
EUR 800 billion managed spend in 2019
We help our customers simplify operations and spend smarter by automating their procurement and finance processes We are the global leader with largest e-invoicing network in the world #1 in accounts payable automation and #1-3 in procurement 38% 23% 33% 5%
Revenue by area (Q1/2020)
Americas Nordics Europe APAC
%
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Receive Source Order Shop Invoice Match Analyze Pay
1) Total economic impact of Basware’s Purchase-to-Pay Cloud Solution, Forrester 2017
From inefficient invoice process → to AP automation From uncontrolled spend → to spend under management From lack of cashflow visibility → to optimize spend with analytics 307% return on investment and a payback time of 12 months1)
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Large ge addressab essable le market ket Market rket leader er with th unique ue
ng Prof
able cloud ud grow
R 15 bill llion market ket pote tentia ntial
ader in netw twor
ked purchase hase-to to-pay pay
gest st e-invoi voici cing ng netw twork and innova vato tor in analyti lytics
tions s on-goin going g to impr prove ve prof
tabi bilit lity while le retai taining g cloud ud grow
th
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Leader with strong market understanding, innovation and product roadmap, and customer experience
“well suited to multinational organizations moving to digital procurement and looking to automate invoice processing”
MAGIC QUADRANT FOR PROCURE TO PAY SUITES 2019
“a leading choice for CPOs and CFOs who aim at achieving 90% or more process automation across their P2P spend”
5/5 in Product strategy | 5/5 in Globalization | 4.2/5 in Invoice Processing FORRESTER WAVE: ePROCUREMENT PLATFORMS, Q4 2019
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Geographies where Basware supports customers
Automotive Manufacturing Healthcare / Pharma Telco / Media Energy / Utility Food / Beverage Services Industrials Transport Retail Finance / Professional Public Sector
1.5m+ + organisations
connected to network EUR 800 billion spend managed in 2019
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TRANSFORMATION CONSOLIDATION OPTIMIZATION
Client transformations Subscription pricing All new business is cloud Making it happen – cloud growth Mature processes Consolidate systems Achieve step change in cost base Drive efficiency Cloud growth and profitability Adaptive optimization Drive efficiency and margins Strategic investments Cloud growth & margins Push to cloud Grow profitably Finetune
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Simplification and profitable growth
Consolidation
Transition to AWS initiated Sale of non- strategic businesses in 2018 Functional
Cloud focused strategy in 2016 Scanning services
Productivity programme Launched in Q1/19 Cloud revenues reach 2/3 of total Consolidation of product portfolio
Push to Cloud
Robust business development in H2/19 Q1/20 Cloud revenue +14% YoY EBIT 0.1M€
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▪ Cloud revenue growth +14% in Q1/20* ▪ Cloud 73% of total revenue ▪ Maintenance, license and other revenue declines in line with expectations as Basware transitions customers to cloud
EUR million1)
*On an organic basis at constant currencies
1)Q1/2017-Q2/2018 revenue has been adjusted for disposals and is indicative only.
5 10 15 20 25 30 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 Q1/20 Cloud revenue Consulting Maintenance, license and other revenue
*Organic constant currency basis
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Cloud Non-Cloud
Gross renewal rate in 2019 Net renewal rate in 2019 Cloud gross margin in Q1/2020 LTV / CAC ratio in 2019
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EBIT Basware’s cost base is scalable and has variable cost components that can be reduced to a certain extent to maintain profitability. EBIT for 2020 is expected to be positive. On April 21st Basware updated its 2020 guidance to reflect the estimated impact of the Covid-19 pandemic.
Net Sales Net Sales guidance will be given when it is possible to estimate the COVID-19 pandemic effects more precisely.
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#1 Happy Customers
MUST-WIN BATTLES LONG TERM
#2 Delivery Capabilites #3 Procurement #4 Sell with Advisory Partners #5 Transformations; now and after Realize growth potential Enable Visible Commerce
Scalable growth and profitability Increase operational efficiency in strategic business Simplify operations, clean up legacy
GUIDING PRINCIPLES
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Basware solutions digitalize and automate customers Purchase-to- Pay processes which enables work from home. 100% visibility and a holistic view to suppliers are key when mitigating against supply shortages, labour irregularities and slow-downs in logistics. With Basware Analytics companies can analyse spend and plan ahead, prioritize critical suppliers and avoid late payments.
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Basware 2019 revenues
Current market
Market potential
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Market leader with unique offering Profitable cloud growth Large addressable market
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Basware AP Automation Basware Purchase Basware Vendor Manager Open philosophy: Pluggable specialist solutions and 3rd party coexistence Network Open Network: partnerships / expansion Data & Analytics
APIs
+200 interops B2G networks Regional partners
APIs
3rd party procurement Sourcing Spend Analytics Vendor Risk Management CLM Contingent Workforce Management
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*Source: Ardent Partners report, 2018
BEST IN CLASS
Supplier creates and sends invoices electronically Automatic content validation & format conversion Invoices automatically arrive in customer AP/ERP
days*
MANUAL
Customer receives invoices in mailroom Customer scans invoices Customer validates invoices Customer enters the data into a system Suppliers create invoices
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▪ Reported as annual recurring revenue (ARR) gross order intake ▪ Share of cloud order intake from new customers increasing ▪ Key markets: US, UK, Germany and France
EUR million
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EUR thousand Q1/2020 Q1/2019 Change,% 2019 2018 Change, %
Net sales 38,245 35,895 6.5 148,302 141,417 4.9 Cloud 27,774 24,282 14.4 101,442 89,482 13.4 Consulting 6,496 5,441 19.4 24,962 23,567 5.9 Maintenance, license and other 3,975 6,172
21,889 28,368
Cost of sales
2.7 Gross profit 20,772 17,748 17.0 76,810 71,797 7.0 S&M
5.0 R&D
26,815
G&A
Total operating expenses
0.1 Other operating income and expenses
13,242 Operating profit (EBIT) 100
Adjustments
1,960 3,781
Depreciation and amortization 3,970 4,121
10,688 49.2 Adjusted EBITDA 4,011
5,185
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SHAREHOLDER DISTRIBUTION AS OF APRIL 30, 2020
1 Based on Euroclear Finland shareholder register as of April 30, 2020 2 Based on their latest flagging notification
TOP 20 SHARE REHOLDERS RS1 Shares, , pcs % o
1 Arrowgrass Capital Partners2
3,600,698 25.0
2 Sihvo Ilkka
887,300 6.2
3 Long Path Partners LP2
760,971 5.3
4 Briarwood Chase Management2
720,347 5.0
5 Vaajoensuu Hannu
567,857 3.94
6 Fjärde Ap Fonden
469,873 3.26
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Ilmarinen Mutual Pension Insurance Company 420,830 2.92
8 Perttunen, Sakari
384,375 2.67
9 Veritas Pension Insurance Company Ltd.
352,345 2.45
10 Danske funds
270,000 1.87
11 The State Pension Fund
256,000 1.78
12 Pöllänen Antti
192,127 1.33
13 Perttunen, Meimi
145,107 1.01
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Sijoitusrahasto Taaleritehdas Mikro Markka 90,000 0.62
15 Vaajoensuu, Matias
83,800 0.58
16 Vaajoensuu Petra
83,800 0.58
17 Vaajoensuu Sara
83,700 0.58
18 OP-Finland Small Firms Fund
79,605 0.55
19 Kaloniemi Markku
77,000 0.53
20 Koripalloilun Tukisäätiö Sr
45,000 0.31 Total top 20 9,570,735 66.5 % Total number of shares 14,401,936 100 % Executive team & Board 6 % International Institutional Investors 52 % Other Founders 15 % Finnish Institutional Investors 15 % Households 8 % Other 4 %
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Q1/2019 Q2/2019 Q3/2019 Q4/2019 Q1/2020
EUR thousand 1-3/ 2020 1-3/ 2019
EBITDA
4,070
Capitalizations
Finance expenses
Taxes, excl. deferred taxes
Share based compensation, share part
Gain/loss on sale of assets
285 534
Free cash flow metric
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EUR thousand 1-3/ 2020 1-3/ 2019 Cash flows from operating activities 6,497 1,626 Net change in cash and cash equivalents 1,250
Cash and cash equivalents 32,558 35,117 Gross financial debt 62,264 53,669 Net financial debt 29,706 18,522
▪ Improvement in operating cash flows driven by higher profitability ▪ Heightened efforts on receivables collection ▪ Increase in gross and net financial debt mainly driven by PIK interest and principal accrual