Q213 Lender Update. January 14, Copyright Infor. All Rights Reserved.

Transcription

1 Q213 Lender Update January 14,

2 Financial Update 2

3 Q2 FY13 Executive Summary Q213 total pro forma revenue was $688.0M On a constant currency basis, Q213 total pro forma revenue was $695.5M, up 1.2% Demand environment remains challenging, particularly in APAC and EMEA Q213 pro forma license revenue was $124.1M On a constant currency basis, Q213 pro forma license revenue of $125.2M, an increase of 0.2% We saw strength in the Americas, manufacturing, hospitality, and asset management Q213 pro forma product update and support revenue was $363.5M On a constant currency basis, Q213 pro forma product update and support revenue of $366.5M was 1.4% above Q212 We continue to see strong retention and growth in our maintenance business Q213 pro forma consulting services and other revenue was $200.4M On a constant currency basis, Q213 pro forma consulting services and other revenue of $203.8M was 1.4% above Q212 We have returned to growth after two challenging quarters Q213 Adjusted Pro Forma EBITDA was $209.8 (30.5% margin) On a constant currency basis, Q213 Adjusted Pro Forma EBITDA of $210.5M was 0.6% above Q212 We continue to deliver solid margins with minimal addbacks Cash balance at the end of Q213 was $238.5M Collections and cash generation remain strong 3

4 Q213 v. Q212 P&L: GAAP Actual Results Currency-adjusted Results $ in millions Actual Actual % Currency Adjusted Actual % Q213 (1) Q212 Variance Variance Impact (1) Q213 Q212 Variance Variance Revenue License fees $ $ $ % $ (1.2) $ $ $ % Product updates and support fees % (2.9) % Software revenues % (4.1) % Consulting services and other fees (1.4) -0.7% (3.4) % Total revenues % (7.5) % Expenses Cost of license fees (2.0) -9.0% (0.2) (1.8) -8.1% Cost of product updates and support fees (2.6) -3.9% (0.9) (1.7) -2.6% Cost of consulting services and other fees (3.3) -2.2% (2.9) (0.4) -0.3% Sales and marketing costs % (1.4) % Research and development % (1.0) % General and administrative (18.1) -26.3% (0.3) (17.8) -25.9% Amortization of intangible assets and depreciation (17.1) -19.9% (0.3) (16.8) -19.6% Restructuring costs (7.4) -64.3% (0.1) (7.3) -63.5% Acquisition related and other costs % % Total operating expenses (34.8) -5.8% (7.1) (27.7) -4.6% Income from operations % (0.4) % Interest expense, net (16.3) -13.6% (16.3) -13.6% Loss on extinguishment of debt nm nm Other (income) expense, net 25.0 (45.9) 70.9 nm (45.9) 70.3 nm Loss before income taxes (17.0) (37.0) % (1.0) (16.0) (37.0) % Provision (benefit) from income taxes (5.2) nm (5.2) nm Net loss $ (22.7) $ (47.9) $ % $ (1.0) $ (21.7) $ (47.9) $ % (1) Currency impact is computed by converting actual results using Q212 exchange rates 4

5 Q213 v. Q212 P&L: Pro Forma Pro Forma Results (1) Currency-adjusted Results $ in millions % Currency Adjusted % Q213 (3) Q212 Variance Variance Impact (2) Q213 Q212 Variance Variance Revenue License fees $ $ $ (0.8) -0.6% $ (1.1) $ $ $ % Product updates and support fees % (3.0) % Software revenues % (4.1) % Consulting services and other fees (0.6) -0.3% (3.4) % Total revenues % (7.5) % Expenses Cost of license fees (2.0) -9.0% (0.2) (1.8) -8.1% Cost of product updates and support fees (2.6) -3.9% (0.9) (1.7) -2.6% Cost of consulting services and other fees (3.9) -2.5% (3.0) (0.9) -0.6% Sales and marketing costs % (1.4) % Research and development % (1.0) % General and administrative (18.0) -26.2% (0.3) (17.7) -25.8% Amortization of intangible assets and depreciation (17.2) -20.0% (0.3) (16.9) -19.7% Restructuring costs (7.4) -64.3% (0.1) (7.3) -63.5% Acquisition related and other costs % % Total operating expenses (35.7) -5.9% (7.2) (28.5) -4.7% Income from operations % (0.3) % Interest expense, net (4.5) -4.2% (4.5) -4.2% Loss on extinguishment of debt nm nm Other (income) expense, net 25.0 (45.9) 70.9 nm (45.9) 70.3 nm Income (loss) before income taxes (11.9) 20.0 (31.9) % (0.9) (11.0) 20.0 (31.0) % Provision for (benefit from) income taxes (9.2) nm (9.2) nm Net income (loss) $ (17.6) $ 5.1 $ (22.7) nm $ (0.9) $ (16.7) $ 5.1 $ (21.8) nm Add backs % % Adjusted EBITDA $ $ $ % $ (0.7) $ $ $ % Adjusted EBITDA margin 30.5% 30.4% 30.3% 30.4% (1) Pro Forma Results contain pre-acquisition results, reversal of acquisition-related adjustments, adjustments to debt reflecting our current debt structure and the related tax effects (2) Currency impact is computed by converting actual results using Q212 exchange rates (3) Q213 and Q212 results include stock compensation expense by category as follows: Cost of product updates and support fees $ - $ - Cost of consulting services and other fees - - Sales and marketing Research and development General and administrative Stock Compensation Expense $ 1.5 $ 0.2 5

6 Q213 v. Q212 EBITDA: Pro Forma Pro Forma Results Currency-adjusted Results $ in millions % Currency Adjusted % Q213 Q212 Variance Variance Impact (1) Q213 Q212 Variance Variance Net income (loss) $ (17.6) $ 5.1 $ (22.7) % $ (0.9) $ (16.7) $ 5.1 $ (21.8) % Reconciliation of net incoem (loss) to adjusted Pro Forma EBITDA Net Interest (4.5) -4.2% (4.5) -4.2% Income tax expense (benefit) (9.2) -61.7% (9.2) -61.7% Depreciation and amortization (17.2) -20.0% (0.3) (16.9) -19.7% Loss on extinguishment of debt nm nm FX (gains) losses 25.1 (45.9) 71.0 nm (45.9) 70.4 nm Pro Forma EBITDA (0.6) Share-based compensation % % Acquisition transaction and integration costs % % Non-recurring, extraordinary, exceptional, unusual (gains) losses (8.6) -83.5% (8.6) -83.5% Restructuring (7.4) -64.3% (0.1) (7.3) -63.5% Other non-operating expenses (0.7) -25.0% (0.7) -25.0% Lawson transaction costs savings (2) (7.2) % (7.2) % Infor combination cost savings (3) (3.2) -86.5% (3.2) -86.5% Adjusted Pro Forma EBITDA $ $ $ % $ (0.7) $ $ $ % (1) Currency impact is computed by converting actual results using Q212 exchange rates (2) Anticipated cost savings from the acqusition of Lawson yet to be realized (3) Anticipated cost savings from Combo Co yet to be realized 6

7 YTD13 v. YTD12 P&L: GAAP Actual Results Currency-adjusted Results Actual Actual % Currency Adjusted Actual % YTD FY13 YTD FY12 Variance Variance Impact (1) YTD FY13 YTD FY12 Variance Variance Revenue License fees $ $ $ % $ (5.1) $ $ $ % Product updates and support fees % (17.7) % Software revenues % (22.8) % Consulting services and other fees % (14.8) % Total revenues 1, , % (37.6) 1, , % Expenses Cost of license fees (2.9) -7.1% (1.0) (1.9) -4.7% Cost of product updates and support fees (2.1) -1.6% (4.1) % Cost of consulting services and other fees % (12.3) % Sales and marketing costs % (6.6) % Research and development % (4.7) % General and administrative (19.4) -16.1% (2.4) (17.0) -14.1% Amortization of intangible assets and depreciation (20.6) -12.7% (3.0) (17.6) -10.8% Restructuring costs (42.8) -81.7% (0.8) (42.0) -80.2% Acquisition related and other costs (3.4) -18.9% (3.4) -18.9% Total operating expenses 1, ,158.3 (57.3) -4.9% (34.9) 1, ,158.3 (22.4) -1.9% Income from operations % (2.7) % Interest expense, net (25.1) -10.6% (25.1) -10.6% Loss on extinguishment of debt (6.9) -79.3% (6.9) -79.3% Other (income) expense, net 20.8 (28.9) % (28.9) % Loss before benefit from income taxes (20.9) (172.6) % (4.4) (16.5) (172.6) % Benefit from income taxes 35.1 (25.8) 60.9 nm (0.2) 35.3 (25.8) 61.1 nm Net loss $ (56.0) $ (146.8) $ % $ (4.2) $ (51.8) $ (146.8) $ % (1) Currency impact is computed by converting actual results using FY12 exchange rates 7

8 YTD13 v. YTD12 P&L: Pro Forma Pro Forma Results (1) Currency-adjusted Results Actual Actual % Currency Adjusted Actual % YTD FY13 (3) YTD FY12 Variance Variance Impact (2) YTD FY13 YTD FY12 Variance Variance Revenue License fees $ $ $ (1.6) -0.7% $ (5.2) $ $ $ % Product updates and support fees (5.6) -0.8% (17.7) % Software revenues (7.2) -0.8% (22.9) % Consulting services and other fees (14.4) -3.7% (14.8) % Total revenues 1, ,348.2 (21.6) -1.6% (37.7) 1, , % Expenses Cost of license fees (3.7) -8.9% (1.0) (2.7) -6.5% Cost of product updates and support fees (9.8) -7.2% (4.1) (5.7) -4.2% Cost of consulting services and other fees (23.7) -7.5% (12.3) (11.4) -3.6% Sales and marketing costs (7.8) -3.5% (6.6) (1.2) -0.5% Research and development % (4.7) % General and administrative (39.5) -28.2% (2.4) (37.1) -26.4% Amortization of intangible assets and depreciation (32.8) -18.8% (3.0) (29.8) -17.1% Restructuring costs (42.8) -81.7% (0.8) (42.0) -80.2% Acquisition related and other costs (28.9) -66.4% (28.9) -66.4% Total operating expenses 1, ,286.7 (184.9) -14.4% (34.9) 1, ,286.7 (150.0) -11.7% Income from operations % (2.8) % Interest expense, net (2.3) -1.1% (2.3) -1.1% Loss on extinguishment of debt (6.9) -79.3% (6.9) -79.3% Other (income) expense, net 20.8 (27.8) 48.6 nm (27.8) 46.9 nm Loss before benefit from income taxes (9.4) (133.3) % (4.5) (4.9) (133.3) % Provision for (benefit from) income taxes 35.1 (32.6) % (0.2) 35.3 (32.6) % Net loss $ (44.5) $ (100.7) $ % $ (4.3) $ (40.2) $ (100.7) $ % Add backs (61.0) -12.0% (2.3) (58.7) -11.5% Adjusted EBITDA $ $ $ (4.8) -1.2% $ (6.6) $ $ $ % Adjusted EBITDA margin 30.5% 30.4% 30.2% 30.4% (1) Pro Forma Results contain pre-acquisition results, reversal of acquisition-related adjustments, adjustments to debt reflecting our current debt structure and the related tax effects (2) Currency impact is computed by converting actual results using FY12 exchange rates (3) YTD FY13 and YTD FY12 results include stock compensation expense by category as follows: Cost of product updates and support fees $ - $ 2.5 Cost of consulting services and other fees Sales and marketing costs Research and development General and administrative Stock Compensation Expense $ 2.8 $

9 YTD13 v. YTD12 EBITDA: Pro Forma Currency-adjusted Results % Currency Adjusted % YTD FY13 YTD FY12 Variance Variance Impact (1) YTD FY13 YTD FY12 Net loss $ (44.5) $ (100.7) $ % $ (4.3) $ (40.2) $ (100.7) $ % Reconciliation of net loss to adjusted Pro Forma EBITDA Net Interest (2.3) -1.1% (2.3) -1.1% Income tax proviison (benefit) 35.1 (32.6) % (0.2) 35.3 (32.6) % Depreciation and amortization (32.8) -18.8% (3.0) (29.8) -17.1% Loss on extinguishement of debt (6.9) -79.3% (6.9) -79.3% FX (gains) losses 20.9 (27.5) 48.4 nm (27.5) 46.7 nm Pro Forma EBITDA (5.8) % Variance Share-based compensation (28.1) -90.9% (28.1) -90.9% Acquisition transaction and integration costs (28.9) -66.4% (28.9) -66.4% Non-recurring, extraordinary, exceptional, unusual (gains) losses (5.4) -50.9% (5.4) -50.9% Restructuring (42.8) -81.7% (0.8) (42.0) -80.2% Other non-operating expenses (1.5) -27.8% (1.5) -27.8% Lawson transaction costs savings (2) (23.0) % (23.0) % Infor combination cost savings (3) (5.4) -72.0% (5.4) -72.0% Adjusted Pro Forma EBITDA $ $ $ (4.8) -1.2% $ (6.6) $ $ $ % (1) Currency impact is computed by converting actual results using FY12 exchange rates (2) Anticipated cost savings from the acqusition of Lawson yet to be realized (3) Anticipated cost savings from Combo Co yet to be realized Pro Forma Results Variance 9

10 Quarterly Overview: LTM Results $ in millions Quarter Ended February 29, Quarter Ended May 31, Quarter Ended August 31, Quarter Ended November 30, LTM Ended November 30, Revenues License fees $ $ $ $ $ Product updates and support ,382.7 Software revenues ,897.0 Consulting services and other fees Total revenues ,652.8 Expenses Cost of license fees Cost of product updates and support Cost of consulting services and other Sales and marketing Research, development and updates General and administrative Depreciation and amortization of intangible assets Restructuring costs (0.1) Acquisition related and other costs Total operating expenses ,346.9 Income from operations Interest expense, net Loss on extinguishment of debt Other (income) expense, net (23.7) (59.1) (4.2) 25.0 (62.0) Loss before income taxes (10.6) (127.0) (3.9) (17.0) (158.5) Provision (benefit) for income taxes Net loss $ (22.8) $ (129.8) $ (33.3) $ (22.7) $ (208.6) (1) Presented in complance with Infor Notes' Indentures including pro forma results which contain pre-acquisition results, reversal of acquisition-related adjustments, adjustments to debt reflecting our current debt structure and the related tax effects. 10

11 Quarterly Overview: LTM Results $ in millions Quarter Ended February 29, Quarter Ended May 31, Quarter Ended August 31, Quarter Ended November 30, LTM Ended November 30, (1)(2) Net loss $ (22.8) $ (129.8) $ (33.3) $ (22.7) (208.6) Reconciliaition of net loss to Adjusted EBITDA: Net Interest Income tax expense (benefit) Depreciation and amortization Purchase accounting impact - License fees Purchase accounting impact - Product updates and support fees Purchase accounting impact - Consulting Purchase accounting impact - Deferred Costs (3.2) (1.0) (0.4) (0.4) (5.0) Share-based compensation Acquisition transaction and integration costs Non-recurring, extraordinary, exceptional, unusual (gains) losses Restructuring (0.1) Other non-operating expenses FX (gains) losses (23.6) (59.3) (4.2) 25.1 (62.0) Loss on extinguishment of debt Lawson transaction costs savings (3) Infor combination cost savings (4) Adjusted EBITDA $ $ $ $ $ Adjusted EBITDA margin 33.3% 30.8% 30.9% 30.7% 31.4% (1) Presented in complance with Infor Notes' Indentures including pro forma results which contain pre-acquisition results, reversal of acquisition-related adjustments, adjustments to debt reflecting our current debt structure and the related tax effects. (2) Consolidated EBITDA as of November 30, pursuant to the provisions of Infor's Credit Agreement was approximately $833.2 (3) Anticipated cost savings from the acqusition of Lawson yet to be realized (4) Anticipated cost savings from Combo Co yet to be realized 11

12 Balance Sheet: GAAP November 30, May 31, $ in millions Assets Current assets Cash and cash equivalents $ $ Accounts receivable, net Other current assets Total current assets Property and equipment, net of accumulated depreciation Intangible assets, net of accumulated amortization 5, ,268.7 Other long-term assets Total assets $ 6,411.3 $ 6,555.0 Liabilities and Stockholders' Deficit Current liabilities Accounts payable and accrued liabilities Deferred revenue Current portion of long-term debt Total current liabilities 1, ,491.2 Long-term debt 5, ,267.8 Other long-term liabilities Total liabilities 6, ,154.1 Stockholders' deficit (551.9) (599.1) Total liabilities and stockholders' deficit $ 6,411.3 $ 6,

13 Statement of Cash Flows: GAAP $ in millions Six Months Ended Novemebr 30, November 30, 2011 Cash flows from operating activities Net income (loss) $ (56.0) $ (146.8) Adjustments to reconcile net loss to net cash provided by operating activities Depreciation and amortization Non cash items and change in working capital (134.1) (178.0) Net cash provided by (used in) operating activities (48.3) (162.4) Cash flows from investing activities Acquistion, net of cash acquired (39.8) (1,501.6) Purchases of property, equipment and software (18.1) (8.8) Other investing activities 1.8 (3.1) Net cash used in investing activities (56.1) (1,513.5) Cash flows from financing activities Deferred financing fees and other financing activities (27.6) (84.0) Proceeds from the issuance of stock Proceeds from issuance of debt 2, ,063.8 Payment of debt obligations (2,802.3) (846.0) Net cash (used in) provided by financing activities (51.0) 1,613.8 Increase (decrease) in cash and cash equivalents (155.4) (62.1) Effect of exchange rate on cash and cash equivalents 9.5 (13.8) Net increase (decrease) in cash and cash equivalents (145.9) (75.9) Cash and cash equivalents Beginning of the period End of the period $ $

14 Debt Summary Outstanding USD Outstanding Tranche Currency Pricing November 30, November 30, Maturity First Lien - Tranche B-1 Term Loan USD AER (2) margin (1) $370.0 $ /5/2016 First Lien - Tranche B-2 Term Loan USD AER (2) margin (1) $2,793.1 $2, /5/2018 First Lien - Term Loan EUR (3) AER (2) margin (1) 249 $ /5/2018 Lawson Senior Notes USD 9.375% $1,015.0 $1, /1/2019 Lawson Senior Notes EUR (3) % 250 $ /1/2019 Lawson Senior Notes USD % $560.0 $ /15/2018 Lawson Senior Notes Discount USD ($18.1) ($18.1) Total Debt $5,367.1 Less: Cash Balance ($238.5) Net Debt $5,128.6 LTM EBITDA $832.7 LTM EBITDA to Total Debt LTM EBITDA to Net Debt LTM EBITDA to Senior Debt 6.5 X 6.2 X 4.2 X (1) Pricing has step downs based upon leverage levels (2) Adjusted Eurocurrency Rate (AER) - The AER floor is 1.25% per annum. (3) Euro exchange rate as of November 30, equaled

15 Operating Metrics 15

16 Revenue metrics By region (Q2 13) By region (FY12) 34% 9% 57% Americas EMEA APAC 35% 9% 56% Americas EMEA APAC By type (Q2 13) By type (FY12) 29% 18% License 28% 20% License Maintenance Maintenance 53% Services 52% Services * Revenue Metrics are based on Pro Forma Revenue using actual rates 16

17 Operational metrics Direct/Channel mix license bookings Customer mix license bookings 100% 80% 22% 21% 22% 18% 23% 100% 80% 16% 21% 19% 27% 22% 60% 60% 40% 78% 79% 78% 82% 77% 40% 84% 79% 81% 73% 78% 20% 20% 0% Q212 Q312 Q412 Q113 Q213 0% Q212 Q312 Q412 Q113 Q213 Top = channel Bottom = direct Top = new customers, Bottom = existing customers Licenses - new customers Forecasted LTM gross retention Q212 Q312 Q412 Q113 Q % 80% 60% 40% 20% 0% 94% 94% 94% 94% 94% Q212 Q312 Q412 Q113 Q213 Maintenance retention incorporates forecast for open renewals; historical periods are updated to reflect actual renewal rates 17

18 Productivity metrics Pro forma license revenue per rep ($000s) Professional services utilization Q212 Q312 Q412 Q113 Q213 90% 75% 60% 45% 30% 15% 0% 55% 54% 56% 56% 63% Q212 Q312 Q412 Q113 Q213 Changed methodology in FY13 to incorporate managers and restated FY12 18

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