TECHNOLOGY | INNOVATION | SOLUTIONS Investor Presentation January 2016
Forward-looking Statements & Non-GAAP Financial Information TECHNOLOGY | INNOVATION | SOLUTIONS Forward-Looking Language This presentation and all publicly available documents, including the documents incorporated herein and therein by reference, contain, and our officers and representatives may from time to time make, "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," "will" and similar references to future periods, including statements on the slides in this presentation titled “Total Addressable Market,” “FY 16 Outlook,” and “Investment Highlights. ” Forward-looking statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. These statements are based on management’s current expectations, intentions or beliefs and are subject to a number of factors, assumptions and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Factors that could cause or contribute to such differences or that might otherwise impact the business include the risk factors set forth in Item 1A of the company’s Annual Report for the fiscal year ended March 31, 2015. Copies are available from the SEC or the Agilysys website. We undertake no obligation to update any such factor or to publicly announce the results of any revisions to any forward-looking statements contained herein whether as a result of new information, future events or otherwise. Use of Non-GAAP Financial Information To supplement the unaudited condensed consolidated financial statements presented in accordance with U.S. GAAP in this press release, certain non-GAAP financial measures as defined by the SEC rules are used. These non-GAAP financial measures include adjusted cash flow from operations and adjusted EBITDA. Management believes that such information can enhance investors' understanding of the company's ongoing operations. See the tables on slide 21 & 22 for reconciliations to the comparable GAAP measures. 2
Key Financial Statistics TECHNOLOGY | INNOVATION | SOLUTIONS Market Stats Diluted Shares Outstanding Stock Price (1/5/16) $9.75 22.4M Diluted Market Capitalization 52 Week High $12.56 $218M 52 Week Low $7.97 Total Debt (at 9/30/2015) $0.2M Cash & Marketable Securities $62M Average Daily Volume (3 months) 37,400 (at 9/30/2015) Basic Shares Outstanding 22.4M Enterprise Value $157M • Adjusted EBITDA ^ Financial Metrics & Valuation (TTM*) Revenue $110.6M $10.0 Adjusted EBTIDA ^ $1.8M $6.5 Earnings per share ($0.39) EV/Revenue 1.4x $1.8 $1.8 $1.2 $0.0 FY13 FY14 FY15 TTM* *TTM for the twelve month period ended September 30, 2015 ^Non-GAAP measure, see reconciliation on slide 21 & 22 FY13 & FY14 results reflect the sale of RSG and UK entity 3
Our Mission and Vision TECHNOLOGY | INNOVATION | SOLUTIONS Our Vision Our Purpose Transform the guest services experience in the Build lasting connections with our team, our customers, hospitality industry. our stakeholders and our communities. 4
Established In-Market Product Offerings: Interfaced, Not Common Platform TECHNOLOGY | INNOVATION | SOLUTIONS TECHNOLOGY | INNOVATION | SOLUTIONS Point-of-Sale (Order) 56% of Revenue Document Property Management Management (Order, Procure) (Book, Arrive, Order) 3% of Revenue 26% of Revenue Workforce Inventory & Management Procurement (Staff) (Procure) 11% of Revenue 2% of Revenue Note: Revenue contribution figures represent percentage of TTM for the twelve months ended September 30, 2015. 5
Key Differentiators TECHNOLOGY | INNOVATION | SOLUTIONS The best hospitality knowledge coupled with the best technology talent Scalability Scalability Scalability Customer Engagement Support deployments from single High levels of customer lane café (POS) to 8,000 room service and satisfaction leads to industry-leading average customer property (PMS) on a single instance life of over ten years Competitive Strengths Scalability Scalability Stability Offline Capabilities Successfully running mission Handle disconnected scenarios for critical operations for high profile weeks at a time accounts Scalability Integrated Suite Full-service product suite supports customers ’ business operations 6 6
rGuest Technology Development Strategy & Plan TECHNOLOGY | INNOVATION | SOLUTIONS • Shifting focus from product-centric solutions with a high number of software modules and operating silos to integrated platform centric solution for Lodging, F&B and Payments applications • Designed to run as a Software as a Service (“SaaS”) -based platform on the public cloud, private cloud, on premise, or in a hybrid configuration • Changes the guest interaction dynamic from “Transaction” to “Experience Management” • Transforms Agilysys to a SaaS business • Primary focus now on subscription services revenue model compared to legacy license and maintenance revenue model • Continue to provide customers an upgrade and/or migration path from previously purchased Agilysys products to new rGuest application • rGuest sales account for approximately 2% of TTM revenue for the period ended September 30, 2015 7 7
rGuest Platform & Product Offering Overview: End-to-End Solutions TECHNOLOGY | INNOVATION | SOLUTIONS Today’s Offering Guest Lifecycle NextGen Offering Discover Promote Seat Reserve Book / Reserve Seat Stay Arrive Upsell Suggest Order Buy Stay Pay Pay Agilysys’ Unified Platform for Experience Survey Delivering its Next Generation Offerings Analyze Analyze Profile Procure Supply Staff Staff Market Promote Current offering 8 Future offering 8
rGuest: Managing the Guest Experience TECHNOLOGY | INNOVATION | SOLUTIONS 4 5 O RDER 1 R ESERVE /B OOK 0 D ISCOVER rGuest Buy rGuest Seat 1 R ESERVE /B OOK rGuest Pay 7 2 A RRIVE /P LAN R EFLECT rGuest Analyze 3 S IT rGuest Promote 4 O RDER /R EST 5 O RDER /E NJOY 3 S IT 6 D EPART rGuest Seat 7 R EFLECT 4 5 O RDER rGuest Buy rGuest Stay 4 5 O RDER rGuest Pay rGuest Buy rGuest Stay 2 A RRIVE /P LAN rGuest Pay rGuest Seat 6 rGuest Analyze D EPART rGuest Stay rGuest Buy rGuest Analyze rGuest Stay rGuest Pay 9 Current Offering Future Offering 9
rGuest Platform Value Proposition TECHNOLOGY | INNOVATION | SOLUTIONS Revenue & Profit Growth, Guest Recruitment, Increase Wallet Share Improve Recruitment Optimize Personalized Service, Operations, Strengthen Connection Reduce Costs 10 10
Delivering Vision Through the rGuest Platform TECHNOLOGY | INNOVATION | SOLUTIONS Common • • Allows for rich data integration Common User Interface Rich for Agilysys applications as User through-out all Integrations well as customers and Interface applications partners • Shared configuration and • Open Shared Built with an open SOA management to reduce architecture in mind for architecture Configuration overhead of managing partner and customer multiple systems application integration Cloud Common technology Services • • Designed from the ground up Common services allow today’s for trends and rapid innovation across the tomorrow’s innovations Agilysys suite of • Cloud delivered, but future applications options for on premise and hybrid scenarios 11 11
Product Status TECHNOLOGY | INNOVATION | SOLUTIONS Limited Release Available (PMS) Initial Release: Fall 2015 (POS) Insight Mobile Manager (IMM) v1.x for LMS & Visual One 12 12
Total Addressable Market is Growing TECHNOLOGY | INNOVATION | SOLUTIONS $14B+ Market Opportunity $4.3B Addressed Market AGYS Product roadmap significantly expands total addressable market Industry growth expected at 5-7% annually (commissioned IHL and STR study) 13
Significant Room for Growth in Markets We Serve TECHNOLOGY | INNOVATION | SOLUTIONS $4B in annual spending on existing software services and recurring software maintenance for current product portfolio Gaming Revenue Mix by Market (TTM*) Casino Del Sol Pinnacle Entertainment Boyd Gaming Sands Casino & Resort Ho-Chunk Gaming The Cosmopolitan of Las Vegas 9% Oxford Casino Valley View Casino & Hotel Maryland Live! Casino Caesars Palace Hotels, Resorts, and Cruise 17% The Broadmoor Colorado Springs The Breakers Palm Beach Pinehurst The SeaPines Resort Vail Resorts Black Rock Oceanfront Resort Royal Lahaina Resort 50% Royal Caribbean International Norwegian Cruise Lines Food Service Compass Group Benchmarc Restaurants by Marc Murphy 24% Sugar Factory BRguest Hospitality Savor Restaurants, Universities, Stadia and Healthcare Yale University Vanderbilt University California State University at Fullerton – Auxiliary Services Corporation Note: Revenue contribution figures represent percentage of TTM for the twelve months ended September 30, 2015. 14
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