PRESENTATION Q4 2017 Vesa Tykkylinen, CEO Niclas Rosenlew, CFO - - PowerPoint PPT Presentation

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PRESENTATION Q4 2017 Vesa Tykkylinen, CEO Niclas Rosenlew, CFO - - PowerPoint PPT Presentation

INVESTOR PRESENTATION Q4 2017 Vesa Tykkylinen, CEO Niclas Rosenlew, CFO February 2, 2018 IMPORTANT NOTICE The following information contains, or may be deemed to contain, forward-looking statements. These statements relate to future events


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SLIDE 1

INVESTOR PRESENTATION Q4 2017

Vesa Tykkyläinen, CEO Niclas Rosenlew, CFO February 2, 2018

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SLIDE 2

IMPORTANT NOTICE

The following information contains, or may be deemed to contain, forward-looking statements. These statements relate to future events or future financial performance, including, but not limited to, expectations regarding market growth and development as well growth and profitability of Basware. In some cases, such forward-looking statements can be identified by terminology such as “expect”, “plan”, “anticipate”, “intend”, “believe”, “estimate”, “predict”, “potential”, or “continue”, or the negative of those terms or

  • ther comparable terminology. By their nature, forward-looking statements involve risks and uncertainties because they relate to

events and depend on circumstances that may or may not occur in the future. Future results may vary from the results expressed in,

  • r implied by, the forward-looking statements, possibly to a material degree. All forward-looking statements included herein are

based on information presently available to Basware and, accordingly, Basware assumes no obligation to update any forward- looking statements, unless obligated to do so pursuant to an applicable law or regulation. Nothing in this presentation constitutes investment advice and this presentation shall not constitute an offer to sell or the solicitation

  • f an offer to buy any securities of Basware or otherwise to engage in any investment activity.
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SLIDE 3

CEO REVIEW

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SLIDE 4

SPEND SMARTER

WHY BASWARE

100% Paperless Processes Network is Differentiator EUR 15bn Market Opportunity SIMPLIFY OPERATIONS

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SLIDE 5

VALUE TO CUSTOMERS OF BASWARE SOLUTIONS

307% Return on Investment 45% Reduction in Invoice Processing Costs 12 Month Payback Time

The Total Economic Impact™ Of Basware’s Purchase-To-Pay Cloud Solution Link to report:

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SLIDE 6

CUSTOMER SUCCESS

EXAMPLES OF GLOBAL CUSTOMER WINS ACROSS INDUSTRIES IN 2017

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SLIDE 7

CUSTOMER SUCCESS

EXAMPLES OF CUSTOMER TRANSFORMATIONS SIGNED IN 2017

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SLIDE 8

BASWARE LEADS INDUSTRY INNOVATION IN 2017

Enhancements to Analytics: Peer Benchmarking, Supplier Quality Smart Coding with Machine Learning Value Added Services: Vault, Discount

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SLIDE 9

SALES PRODUCTIVITY INCREASES

Effects of efficiency measures visible in significant increase in sales productivity

FY 2016 FY 2017

ARR Order Intake* per Quota Carrier

*Subscription annual recurring revenue gross order intake is calculated by summing the total order intake in the period expressed as an annual contract value. This includes SaaS and other subscription types. Transaction revenue is not included. Gross new order intake covers new cloud customers, add-ons and renewal uplifts but excludes churn. There will be a time lag before this order intake is visible in net sales.

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SLIDE 10

FOCUS ON CORE STRATEGY

Disposal of Basware Banking and Financial Performance Solutions announced

  • n 2 February 2018

Focus on cloud Focus on global growth Sale aligned with strategy

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SLIDE 11

Q4 2017 STRONG CLOUD MOMENTUM

Cloud revenues 55%

  • f total

Subscription ARR Order Intake 2017 +63% Productivity improvements fully visible in financials

STRATEGIC PRIORITY: CLOUD REVENUE GROWTH

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SLIDE 12

FINANCIAL REVIEW

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SLIDE 13

0,0 2,0 4,0 6,0 8,0 10,0 12,0 14,0

Q4 2016 Q4 2017 FY 2016 FY 2017

SOLID SUBSCRIPTION ORDER INTAKE

EUR m

  • Investments in

sales and marketing delivered solid

  • rder intake
  • Time lag to

visibility in revenues

Subscription annual recurring revenue gross order intake is calculated by summing the total order intake in the period expressed as an annual contract value. This includes SaaS and other subscription types. Transaction revenue is not included. Gross new order intake covers new cloud customers, add-ons and renewal uplifts but excludes churn. There will be a time lag before this order intake is visible in net sales.

2.2 3.4 7.9 12.8

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SLIDE 14

STRONG CLOUD REVENUES

10 20 30 40 50 60 70 80 90 Q4 2016 Q4 2017 FY 2016 FY 2017 SaaS Transaction Services Other Cloud Revenues

EUR m

Cloud Non Cloud

55%

More than half of total revenues now from Cloud

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SLIDE 15

Q4 2017 NET SALES PROGRESSION

  • SaaS growth

continued to be strong, up 28%

  • Significant cloud

potential in existing maintenance customer base being addressed

Net sales by revenue type (EUR thousand) 10-12 2017 10-12 2016 Change Cloud Revenue SaaS 9 162 7 173 28 % Transaction services 11 261 10 172 11 % Other cloud revenue 1 303 1 576

  • 17 %

Cloud Revenue total 21 726 18 900 15 % Non-Cloud Revenue Maintenance 8 856 10 075

  • 12 %

License sales 1 383 1 962

  • 30 %

Consulting services 7 796 9 360

  • 17 %

Other non-cloud revenue

  • 54
  • 86
  • 37 %

Non-Cloud Revenue total 17 981 21 310

  • 16 %

Group Total 39 707 40 211

  • 1 %
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SLIDE 16

Q4 2017 PROFITABILITY

  • Effect of

productivity programme visible in cost base

  • Savings achieved

as result of personnel reductions approx. EUR 1.8 m in Q4 and EUR 5.1 m in 2017

(EUR thousand) 10-12 2017 10-12 2016 Change Net sales 39 707 40 211

  • 1 %

Materials and services

  • 3 939
  • 4 600
  • 14 %

Personnel expenses

  • 25 879
  • 27 614
  • 6 %

Other operating expenses

  • 9 464
  • 9 623
  • 2 %

Total costs and expenses excluding depreciation

  • 39 282
  • 41 837
  • 6 %

Reported EBITDA 349

  • 1 623

Adjustments to EBITDA 1 023 5 283

  • 81 %

Adjusted EBITDA 1 372 3 660

  • 63 %
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SLIDE 17

Q4 2017 R&D INVESTMENTS

  • Full impact of

Q4 2016 productivity measures realised

(EUR thousand) 10-12 2017 10-12 2016 Change R&D expenses excluding depreciation 3 072 3 410

  • 10 %

Capitalised R&D 2 321 3 179

  • 27 %

Total R&D investments 5 393 6 589

  • 18 %

Total R&D investments as % of net sales 14 % 16 %

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SLIDE 18

Q4 2017 CASH FLOW AND BALANCE SHEET

  • Strong liquidity

position with cash and undrawn bank facilities totalling EUR 31 m

(EUR thousand) 10-12 2017 10-12 2016 Cash flows from operating activities

  • 1 795
  • 5 564

Net change in cash and cash equivalents

  • 4 566

22 856 Cash and cash equivalents 20 683 35 755 Total available liquidity* 30 683 38 755

* Includes undrawn bank facilities and short term deposits

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SLIDE 19

PRO-FORMA IMPACT ON 2017 FINANCIALS

*Assumes that disposals close at end of Q1 2018

EURm Cloud Non-Cloud Total Revenue recognition changes +0.5 to +1.5

  • 0.5 to -1.5
  • 0.5 to + 0.5

Disposals pro-forma effect* on costs c. EUR 5m EURm Cloud Non-Cloud Total Disposals*

  • 1
  • 10
  • 11
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SLIDE 20

Cloud revenues between EUR 90 and EUR 95 million Total costs slightly above 2017 levels**

2018 FULL YEAR OUTLOOK

Basware’s number one strategic priority is cloud revenue growth. FOR 2018, BASWARE EXPECTS*:

*On an organic basis at constant currencies **Excluding D&A and adjustments to EBITDA

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SLIDE 21
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SLIDE 22

APPENDIX

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SLIDE 23

0,0 0,5 1,0 1,5 2,0 2,5 3,0 3,5 4,0 4,5 5,0

Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017

SUBSCRIPTION ARR GROSS ORDER INTAKE

EUR m

  • Subscription

annual recurring revenue gross

  • rder intake

quarterly

Subscription annual recurring revenue gross order intake is calculated by summing the total order intake in the period expressed as an annual contract value. This includes SaaS and other subscription types. Transaction revenue is not included. Gross new order intake covers new cloud customers, add-ons and renewal uplifts but excludes churn. There will be a time lag before this order intake is visible in net sales.

1.9

1.1 2.7 1.9 2.2 2.8 4.4 2.2 3.4

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SLIDE 24

NETWORK BUSINESS DAYS

Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 62 63 65 63 64 61 64 63 63 62 65 64