A Global Leader in Voice Technology Solutions Bringing Android, Wi-Fi and VoIP Together
Apivio Systems Inc. (TSX: APV.V)
www.apivio.com
November 2016
Investor Presentation Apivio Systems Inc. (TSX: APV.V) November - - PowerPoint PPT Presentation
A Global Leader in Voice Technology Solutions Bringing Android, Wi-Fi and VoIP Together Investor Presentation Apivio Systems Inc. (TSX: APV.V) November 2016 www.apivio.com DISCLAIMER THIS PRESENTATION HAS BEEN PREPARED BY APIVIO SYSTEMS INC.
Apivio Systems Inc. (TSX: APV.V)
www.apivio.com
November 2016
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www.apivio.com
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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Beyond Devices Beyond Mobility Beyond Voice
VoIP ne networ
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Office phones will become “smart” as exemplified by cell phones. In the future, all enterprise phones will be smart desk phones.
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MONET SERIES UT880
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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MONET SERIES UT880s
Market opportunity expanded to include BroadSoft’s customers A significant new sales channel for Apivio starting with the UT880s Over 12 million lines and 600+ service providers across 80 countries A leader in the rapidly-growing cloud- based unified communications space
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Others
Market Share Distribution
Vendors Globally
* 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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Hotel Room Dialer Security Personnel CRM Integration Receptionist Video Conferencing
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www.apivio.com UT880s displayed a at the An Annual NE NEC Ad Advantage R Resellers C Conference UT88 880 apps are a priority
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More than 5.5 million phones sold Barrier to entry due to software customization 25%+ CAGR over last three years
IP Phone Unit Sales
519, 519,509 700, 00,402 799, 799,978 924, 924,213 1,072, 72,164 164 20 2015 15 20 2014 14 20 2013 13 20 2012 12 20 2011 11 1,200, 0,000 00 900, 00,00 000 600, 00,00 000 300, 00,00 000 YTD TD ‘ ‘16 765, 765,458
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New c com
unications ns opt
ns
Messaging and SMS. 2 lines for multiple phone numbers
Remote tely ly p provis isio ion-ab able
Configurable by the CLive cloud Switch between on-prem and external settings
Rich features es
Call transfer to internal and external phones Paging and speakerphone
True e cordles ess f freedom
Anywhere Wi-Fi is available Not limited by charging station range
Tru ruly tra ravel-frien endly
Use at home, office, airports, hotels Charge with USB cable, stand optional
Elim limin inatin ting all l permanent t cablin ling
No installation of phone jacks No wired ethernet ports
More than 150k sold in Korea
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VoIP ne networ
Data Co Colle llection & & Analysis is Device M Management Se Self lf-Troubleshooting Interface C Customization Enha nhanc nced A Appl pplications
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2012 2012 2013 2013 2014 2014 2015 2015
in '000s Canadian Dollars
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in '000s Canadian Dollars
Pos
djusted EBITDA for
n Qua Quarters
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Good cash position after 10 quarters of positive Adjusted EBITDA & financing in March 2015. Debt is flat despite increase in sales.
Good cash position after 10 quarters of positive Adjusted EBITDA
Debt is flat despite increase in sales in '000s Canadian Dollars
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in '000s Canadian Dollars
Significant improvement in net working capital over the last two years
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Better balance sheet ratios due to prudent cash management, increased sales and improved margin
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Moimstone Kor
000’s CAD AD) 2014 2015 Rev even enue 46,415 59,694 EBITDA DA 1,643 2,814 Add ba Add back Head Office Ma Management Fees ees 671 622 R&D for No North American Products 1,003 2,111 Adjusted EBITDA 3,316 5,548 Adjusted EBITDA A % 7.1% 9.3%
The Korean Subsidiary (“MK”) sells to Korean Tier-1 telephone carriers Korean business producing revenue and EBITDA growth High barrier to entry due to customization done for Korean customers MK funds R&D of new products for Korean and North American markets
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Mar Market Cap apital alization
Share Pr Price ( (Nove vember 14, 14, 20 2016) 16) $0 $0.2 .25 Basic Sha Share res O Out utstandi ding g 52.8 52.8 Market C Capit italiz lizatio ion $13.2 $13.2 Debt ( (as on September 3 30, 2 2016) ($7.5) $7.5) Cash ( (as on September 3 30, 2 2016) $6.8 $6.8 Options p proceeds $0 $0 Enterp rpri rise V Value ue $13.9 $13.90
(amounts in C$ millions, except per share)
80 Em Empl ploy
n Cana nada da and nd Sout South h Kor
20 2015 R 15 Reve venue/Employee $750 $750K
C$M M ex excep ept f for E EPS PS YTD ‘16 ‘16 20 2015 15 20 2014 14
Revenue $41 $41 $60 $60 $46. $46.6
EBITD TDA $1. $1.0 $2.1 $2.1 $1.4 $1.4 Cash ( (as at e end o
$6.8 $6.8 $5.5 $5.5 $1.8 $1.8 Debt (as a at e end o
$7.5 $7.5 $6.8 $6.8 $7.5 $7.5 EPS EPS $0.00 00 $0.02 02 $0.00 00
APV V stoc
uation
Korean s subsidiary ~4x EV ~4x EV/EB EBITDA Entire c company ~0 ~0.3x 3x EV EV/Sales
Tic icker: : TSXV:A :APV
52 Week eek H Hi/Low C$0.24/ 24/C$0 C$0.48 .48 Insider o
21% 21%
Key Managem emen ent Rob Bakshi
President & CEO
David Pais
CFO
$60M
CEO, Moimstone Korea
CFO, Moimstone Korea
CTO, Moimstone Korea
systems, Semiconductors, VoIP & Wi-Fi and DSL solutions
Chang Il An
Sales – Korea
Dire Directo tors Rob Bakshi
President & CEO
Rob McJunkin
Independent Director
Walter Andri
Independent Director
Mobile, a subsidiary of TELUS.
Jason Donville
Independent Director
David Shaw
Independent Director
Pennsylvania respectively
Committee at Silent Witness Inc., a publically listed TSX company.
Tim Howley
Independent Director
Rahul Aggarwal
Independent Director
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Global N NEC deploym yment Hig igh m marg rgin in, re recurri rring app re revenue will i impr prov
business mode
nd earni nings ngs profile ile Extend c channel b beyond NEC, inc nclude non non-NE NEC d dealer ers, , service e pr provi
and phon nd phone c com
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Disrupt upting the he VoIP VoIP phone phone market w with a h a smart Andr Androi
d de deskph phon
Globa
xclus usive ve pa partne nership w with h NEC Grow
ng Kor
business is EBITDA posit positive a and nd funds R unds R&D for
ne new produ products Low Low Va Valua uation: n: ~4 ~4x x EV/ V/EBIT ITDA A of
Kor
biz or z or 0.35x r x reve venue nue Named d as T Top 1
VoIP s sol
ution n pr provi
der by by Ent nterpr prise Telephon
y Maga gazi zine and on t nd on the he B Branha nham 300 l list of
Cana nada da’s top 2
ICT com
panies 2016 T TSX Ve Vent ntur ure 5 50 Com
pany ny Top 2
ublic C Com
pany s y selected by by the he Cana nadian Innov Innovation E Exc xcha hange
Rob Bakshi, CEO
T: 6 T: 604-761 761-210 2100 rbakshi hi@api pivio.
www.apivio.com
Da David id P Pais is, CF CFO
T: 6 T: 604-340 340-986 9866 dpa pais is@api pivio. io.com
Ba Babak P Pedram, , IR
T: 416 416-995 995-8651 8651 bpedram@vi virtusa sadvi viso sory.c y.com