SeeThruEquity & The Brewer Group Investor Conference
February 22, 2016
powering global commerce
SeeThruEquity & The Brewer Group Investor Conference February - - PowerPoint PPT Presentation
powering global commerce SeeThruEquity & The Brewer Group Investor Conference February 22, 2016 Net Element | Disclaimer Forward-looking statements. Use of Non-GAAP financial measures This presentation and comments made by management contain
SeeThruEquity & The Brewer Group Investor Conference
February 22, 2016
powering global commerce
www.netelement.com 2
Net Element | Disclaimer
Forward-looking statements. Use of Non-GAAP financial measures
This presentation and comments made by management contain forward-looking statements including, among others, statements regarding the expected future operating results of Net Element, Inc. (“Net Element” or the “Company”). These statements are based on management’s current expectations and assumptions and are subject to risks, uncertainties and changes in circumstances. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate” or similar expressions. Actual results may differ materially from those set forth in the forward-looking statements due to a variety of factors. More information about these risks, uncertainties and factors may be found in Net Element’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Net Element does not assume any obligation to update any forward-looking statements as a result of new information, future developments or
This presentation contains certain non-GAAP financial measures determined by methods other than in accordance with generally accepted accounting principles. Such non-GAAP financial measures include: general and administrative expense before non-cash compensation expense. Management uses these non-GAAP financial measures to assess the performance
information about Net Element to assist investors in evaluating Net Element’s operating results. These non-GAAP financial measures should not be considered as a substitute for operating results determined in accordance with GAAP and may not be comparable to other similarly titledmeasures ofother companies.
www.netelement.com 3
Net Element | Overview
Emerging as a leader in mobile payments and transactional services
Net Element, Inc. (NASDAQ: NETE)
$21.2 million Revenue in FY2014
$25.2 million for Nine Months ended Sept 30, 2015
Active in 9 markets
Kyrgyzstan, Azerbaijan, UAE
Leading positions in online and mobile payments
Highly active in world’s fastest growing markets
150 people including 30 IT engineers Global financial technology company specializing in mobile payments and value-added transactional services in the U.S. and fast growing emerging markets.
methods in 50 countries
transactions processed in 2015
$1.8 billion in 2015
www.netelement.com 4
Net Element | Overview
Emerging as a leader in mobile payments and transactional services
Who is Net Element? Our Mission and Vision
and value-added services
transactional services (“VAS”)
infrastructure, commerce expertise, scalable mobile payments platform, world-class cloud infrastructure and emerging market presence
depth knowledge of transactional services and value- added service offerings which separate us from the competition
(“P2P”) transactions and value-added service offerings with focus on creation of unified global transaction acceptance ecosystem
product offerings
and payments segments
strategy
excellence
payment acceptance
market: Deloitte predicted 1,000% growth in mobile payments in 2015
Who is Net Element? We Have a Focused Strategy Our Mission and Vision Our Opportunity is Significant
www.netelement.com 5
Growth Drivers | Focus on 3 areas
Combination of all devices and technologies for multi-channel payments acceptance
Mobile Payments Direct Carrier Billing Point of Sale Solutions Payment Acceptance Value-Added Transactional Services
Point of Sale Solutions
Payment Acceptance
Security
GROUP
11 million+ online payment acceptance customers 3 million+ recurring mobile payments users 90 million mobile transactions processed in 2015 71 million bankcard transactions processed in 2015
TRINITY
PLATFORM
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Growth Drivers | One-Stop Solution
Bringing together the best payment solutions
Combines e-commerce, retail POS, comprehensive back office tools, mPOS, credit scoring and customer interaction in one powerful technology
Integration
APIs and connectors allow integration and customization. Our tools allow for easy integration and our SDK toolkit for building native apps for our omni- channel platform
Enabling Global Commerce
Our payment infrastructure and services are globally oriented, but adapted to each country’s unique requirements
11 million+ online payment acceptance customers 3 million+ recurring mobile payments users 161 million transactions processed in 2015 Processing volume of $1.8 billion in 2015 OMNI-Channel Processing
Merchant
Merchant Account Payment Gateway Risk Compliance
Account Card Issuing
PAYMENT SOLUTIONS
WITH
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Growth Dynamics | United States
United States merchant strategy
United States
51.2 million bankcard transaction in 2015
(45% year-over-year growth in transactions)
added services $240 per annum
Features: Apple Pay; Android Pay; NFC enabled; Mobile card readers; Secure & reliable; 24/7 service Value-add services: shopping cart; rewards and loyalty programs; back office tools; inventory management; credit scoring; analytical dashboard Partners include top brands
www.netelement.com 8
Growth Dynamics | CIS
Mobile payments strategy
Features: Premium SMS; Direct operator billing; WAP automated phone; Web billing; in-app billing Value-add services: content management gateway; SMS gateway; API integration; short code number procurement; analytical dashboard Partners include top brands
Russian Federation and CIS
90 million mobile transactions in 2015
(106% year-over-year growth in transactions)
year-over-year
www.netelement.com 9
Growth Dynamics | Emerging Markets
Online payments strategy
Features: E-commerce gateway; E-wallet; Mobile in-app payments SDK; PCI DSS level 1 security; P2P transfers Value-add services: shopping cart; GDS’ merchant plug-in; fraud monitoring; back office tools; credit scoring; BIN and IP scrubbing; analytical tools Partners include top brands
Emerging Markets
19.5 million online transactions in 2015
(36% year-over-year growth in transactions)
merchants in Russia are clients of PayOnline
www.netelement.com 10
Our Clients | Center of Our Success
Growing portfolio of international clients
According to Forbes, 20% of leading e-Commerce merchants in Russia use PayOnline platform to accept payment transactions in Russia, Europe and Asia.
www.netelement.com 11
Net Element | Financial Snapshot
Selected Income Statement Data (Nine Months Ended Sept 30, 2015)
Sources of Revenues Nine Months Ended September30, 2015 Mix Nine Months Ended September30, 2014 Mix Increase / (Decrease)
US Transaction Processing $19,275,885 77% $ 14,234,253 90% $ 5,041,632 Mobile Payments 3,489,550 14% 1,548,222 10% 1,941,328 Online Payments 2,356,815 9%
2,356,815 Total $ 25,122,250 100% $ 15,782,475 100% $ 9,339,775
Cost of Revenues
US Transaction Processing $ 16,543,190 86% $ 11,690,214 82% $ 4,852,976 Mobile Payments 2,786,984 80% (98,779)
2,885,763 Online Payments 1,457,042 62%
1,457,042 Total $ 20,787,216 83% $ 11,591,435 73% $ 9,195,781
Gross Margin
US Transaction Processing $ 2,732,695 14% $ 2,544,039 18% $ 188,656 Mobile Payments 702,566 20% 1,647,001 106% (944,435) Online Payments 899,773 38%
899,773 Total $ 4,335,034 17% $ 4,191,040 27% $ 143,994
www.netelement.com 12
Net Element | Financial Snapshot
Selected Income Statement Data (Three Months Ended Sept 30, 2015)
Sources of Revenues Three Months Ended September30, 2015 Mix Three Months Ended September30, 2014 Mix Increase / (Decrease)
US Transaction Processing $ 7,826,967 62% $ 5,565,633 92% $ 2,261,334 Mobile Payments 2,795,484 22% 461,328 8% 2,334,156 Online Payments 2,052,672 16%
2,052,672 Total $ 12,675,123 100% $ 6,026,961 100% $ 6,648,162
Cost of Revenues
US Transaction Processing $ 6,489,695 83% $ 4,764,144 86% $ 1,725,551 Mobile Payments 2,758,590 99% (46,289)
2,804,879 Online Payments 1,457,042 71%
1,457,042 Total $ 10,705,327 84% $ 4,717,855 78% $ 5,987,472
Gross Margin
US Transaction Processing $ 1,337,272 17% $ 801,489 14% $ 535,783 Mobile Payments 36,894 1% 507,617 110% (470,723) Online Payments 595,630 29%
595,630 Total $ 1,969,796 16% $ 1,309,106 22% $ 660,690
www.netelement.com 13
Net Element | Growth Strategy
We build strong partnerships with customers over time
$0 $20 $40 $60 $80 $100 $120 2013 2014 2015 2016 2017
Starts with single piece of business
Single marketing
divestiture Infrastructure stabilization
exploration
Strong partnership development
Growth Mode
Segment Leadership
growth
Revenue in Millions $USD
Net Element approaches payments from a broader, holistic, global view of commerce. Our objective is to become an emerging leader in mobile payments and value-added transactional services in the emerging global markets. Pay anywhere using mobile, online or traditional card present methods.
www.netelement.com 14
Investment Highlights
What makes Net Element special
increased over the past ten years and continues to climb
Large & Growing Industry
Viable Business Model
good visibility
activation, client services, data entry and retention
Resilient Operating Leverage
presence
Proven Management Team
Questions & Answers Net Element provides global solutions for mobile payments, online payments and value-added transactional services
Net Element, Inc. 3363 NE 163rd Street, Suite 705 North Miami Beach, FL 33160 +1 305-507-8808 +1 786-272-0696 info@netelement.com www.netelement.com