Presentation of Annual Report Klaus Holse, CEO, SimCorp A/S Thomas Johansen, CFO, SimCorp A/S

Transcription

1 Presentation of Annual Report 2014 Klaus Holse, CEO, SimCorp A/S Thomas Johansen, CFO, SimCorp A/S

2 Disclaimer This presentation contains certain forward-looking statements and expectations in respect of the 2015 financial year. Such forward-looking statements are not guarantees of future performance. They involve risk and uncertainty and the actual performance may deviate materially from that expressed in such forward-looking statements due to a variety of factors. Readers are warned not to rely unduly on such forward-looking statements which apply only as at the date of this announcement. The Group s revenue will continue to be impacted by relatively few, but large system orders, and such orders are expected to be won at relatively irregular intervals. The terms agreed in the individual license agreements will determine the impact on the order book and on license income for any specific financial reporting period. Accordingly, license revenue is likely to vary considerably from one quarter to the next. Unless required by law or corresponding obligations SimCorp A/S is under no duty and undertakes no obligation to update or revise any forward-looking statement after the distribution of this document, whether as a result of new information, future events or otherwise. The turmoil in the global financial markets with significantly increased volatility can potentially impact SimCorp s customers, leading to lower earnings and prolonged decision processes for investments in new software which can have a negative impact on SimCorp s revenue.

3 Agenda 2014 at a glance SimCorp Must Win Battles Our customers our commitment Q review 2014 financial review Outlook 2015 Q&A 3

4 2014 at a glance 4

5 2014 Satisfactory performance despite lack of new orders from the US 8% growth in local currencies negative growth in North America Total revenue of EUR 241.1m and EBIT of EUR 57.3m High win ratios maintained 12 new customers 8 SimCorp Dimension customers 3 in growth markets 4 Coric customers all in growth markets Strong performance in the mature markets with 5 new customers 3 in Central Europe (one in Slovenia) 2 in Benelux Increased penetration of Front Office with Front office and/ or IBOR being the key driver in 6 of 8 Dimension deals Continued replacement of old legacy systems Improved awareness in the single largest growth market North America 5

6 new customers Q1 Q2 Q1 SCD Federis - French asset manager part of large insurance group Q3 SCD SCD SCD Cor SCD Cor SCD Dutch asset manager part of global life insurance company Mitzuho - Luxembourg based asset manager Notenstein Swiss based private bank UK based asset manager Swiss based asset manager stock announcement 100bn+ US based pension fund German based asset manager 6

7 new customers Q4 Q1 Cor US based asset manager SCD SCD Cor Slovenian insurance group signed out of Germany State Oil Fund of the republic of Azerbaijan Eaton Vance Management 7

8 Must win battles IBOR and Front Office Alternative Investments Application Service Provider Growth in low share markets

9 IBOR and Front Office 9

10 IT spending (US$M) Year on Year Growth (%) Why Front Office: More Than 6% CAGR And a USD 2bn+ Annual Market Front Office IT spend, institutional asset managers, * 7,0% ,0% 5,0% ,0% ,0% 2,0% 500 1,0% ,0% 10 * Includes overall FO spend (SW, HW, services, outsourcing) for FO in SimCorp geographies Source: Ovum.

11 Current Status Strong Product Successful Roll Out Still potential with 70+ Clients Signed up Implementing Live Asset Order Compliance Manager: Manager: Manager: +10 YtY +5 YtY +5 YtY

12 Growth in low share markets 12

13 SimCorp designated Growth Markets 13

14 Facts and Figures France United Kingdom North America 2014 Rev EUR 13.7m GBP 14.1m USD 45m # of Clients # of Prospects Employees

15 Attract and Retain The Best People in Our Industry 15

16 16

17 Application Service Provider

18 Service Delivery Management Security Compliance Full Managed Service (ASP) Defined Business Users Application Management Application Operations Middleware Layer: Libraries, Databases, etc. Resource Abstraction and Control Layer: Virtualization and Operating Systems Physical Resource Layer: Datacenter, Servers, Storage Hosting IaaS PaaS ASP Dedicated Infrastructure Platform Application Service 18 Infrastructure Service Provider Service Provider Provider

19 Alternative Investments 19

20 Changes to Asset Allocation 20

21 Our customers Our continued commitment

22 Continued replacement of legacy systems Since 2010 SimCorp has won 38 new licenses and has replaced: SS&C Pacer six times SS&C Portia six times SS&C DST once Internally developed (in-house) systems six times Other legacy systems (Sungard, etc) providers 19 times... While at the same time SimCorp has been replaced ZERO times by a legacy vendor A clear and continued tendency that the market is moving away from old legacy platforms towards modern integrated systems We are well-positioned to take advantage of this being the only truly provider of a state of the art integrated solution 22

23 Performance in our universe win ratio Deals Others SimCorp

24 Development in license base per region License base EURm December 2014 December 2013 Growth Growth % SimCorp total % Central Europe % Nordic % Western Europe % North America % Asia % UK % Currency exchange rates have impacted the total growth in the installed license base in the US base 11%-points and in the UK with 6%-points

25 Add on sales distribution between users and functionality, Users Functionality

26 Financial review of Q

27 Q4 at a glance Two new Dimension customers and two new Coric customers in the quarter Highest quarterly revenue ever also best EBIT in a quarter ever with 37% margin License income from extra sales strong in all material matters all cases that were removed from the pipeline on 18 December 2014 were executed as originally planned Strong performance in Professional Services continued Costs in Q4 higher than 2013 by EUR 3.5m however costs only grew 8% against a revenue growth of 14% in the quarter 27

28 Financial highlights, Q EURm Change Total revenue EBIT Financial items Profit before tax Profit for the period Total assets Total equity Basic earnings per share - EPS (EUR) Cash flow per share CFPS (EUR) EBIT margin (%) Return on equity, ROE (%) (29.3) Equity ratio (%) (3.5) Receivables days outstanding

29 Financial results, Q (EURm) Change Change % License % Extra Sale % Professional Services (1.2) (5.4%) Maintenance % Revenue % EBIT % 29

30 Revenue analysis, Q (Q4 2013) Initial licenses 6% (3%) Add-on licenses 28% (23%) USA, Canada 15% (15%) Other 7% (6%) Denmark, Sweden, Norway, Finland 22% (24%) Maintenance 37% (40%) Australia, Singapore, Hong Kong 6% (6%) UK, Ireland 4% (5%) Professional Services 29% (34%) Belgium, Netherlands, France, Luxemburg 16% (12%) Germany, Austria, Switzerland 30% (32%) 30

31 Financial review of full year

32 Financial highlights Top-line EUR 241.1m (up 7.1 % y/y) 7.6% in local currencies Maintenance EUR 110.4m (up 5.9% y/y) Professional services EUR 79.8m (up 4.6% y/y) License EUR 47.7m (up 12.8% y/y) Order book EUR 16.7m (up 21% y/y) Secured on contract (FY2015) EUR 169m (up EUR 12m y/y) Total costs EUR 184m (up by 7.7% y/y) EBIT EUR 57.3m (EUR 3.1m higher y/y) EBIT margin 23.8% (24.1%) Number of employees (FTE) 2014 is 1,187 (up by 94 y/y) Share buyback in the full year 2014 of EUR 24.5m (EUR 42.9m in 2013) Operating cash flow EUR 44.4m (EUR 47.5m in 2013) 32

33 Financial highlights Proposed dividend increased from DKK 4.0 per share of DKK 1 to DKK 4.5 per share of 1 DKK an increase of 12.5% Share buyback programme for the next six months (until the release of the Q2 results) of EUR 10m. For the full year the share buyback programme is expected to be EUR 20m. 33

34 EURm EURm Revenue, EBITDA and cash flow, % CAGR Revenue EBITDA vs. cash flow from operating activities Cash flow EBITDA 34

35 EURm EURm EBIT and revenue per quarter, EBIT Revenue Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q

36 License, order inflow and order backlog Order inflow Dimension Order backlog Dimension Order backlog Coric Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 36

37 Revenue analysis, 12M 2014 (2013) Initial licenses 7% (5%) Add-on licenses 13% (14%) USA, Canada 16% (17%) Other 4% (4%) Denmark, Sweden, Norway, Finland 23% (24%) Australia, Singapore, Hong Kong 7% (7%) Maintenance 46% (46%) UK, Ireland 5% (6%) Professional Services 34% (35%) Belgium, Netherlands, France, Luxemburg 15% (12%) Germany, Austria, Switzerland 30% (30%)

38 Financial results, 12M 2014 (EURm) Change Change % License % Extra Sale % Professional Services % Maintenance % Revenue % EBIT % 38

39 Cost structure, 12M (EURm) Costs 2014 Share of consolidated costs 2014 Costs 2013 Change relative to 2013 Sales and distribution cost % % Cost of sales % % Research and development costs % % Administrative expenses % % Total % % 39

40 Headcount per quarter Headcount Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Group total 1,123 1,124 1,147 1,163 1,249 1,247 1,242 1,224 Marketing, Services, Sales Product Division Nordic UK Western Europe Central Europe North America APAC Coric Corporate Units

41 Employees FTE per function per quarter FTE R&D Cost of sales Sales and distribution Administration Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q

42 Cash flow (EUR'000) 12M M 2013 Net cash flow from operating activities 44,390 47,447 Net cash flow from/(used) in investing activities (8,908) (2,843) Net cash from operating and investing activities 35,482 44,604 Net cash from/(used) in financing activities (46,524) (55,850) Change in cash and cash equivalents (11,042) (11,246) Cash and cash equivalents at period end 37,995 47,106 42

43 Balance sheet (EUR'000) Intangible assets 11,677 1,178 Property, plant and equipment 4,635 4,839 Other non-current assets 9,195 9,551 Current assets 102, ,901 Total assets 127, ,469 Equity 73,380 71,566 Non-current liabilities 6,172 3,390 Current liabilities 48,255 42,513 Total liabilities and equity 127, ,469 Number of treasury shares 1,002,252 1,710,804 Treasury shares market value 21,880 42,552 43

44 Currency FX impact 12M 2014 EUR 1,000 Revenue Cost Net FX impact EUR/DKK 90,570 33,819 56, DKK 25,890 80,417-54,526 0 NOK 17,008 4,597 12, USD 31,376 19,029 12, GBP 22,260 19,692 2, CHF 20,716 5,100 15, Other 33,424 21,327 12, Total 241, ,981 57,

45 Currency exchange rates EUR per YTD average rates 2014 YTD average rate 31 January 2015 current rate Currency USD CAD AUD SGD GBP CHF NOK

46 46 Outlook

47 Outlook % - 10% revenue growth in local currencies and an EBIT margin of 23% - 26% Outlook reflects the inherent uncertainty in the sales cycles Operational efficiency gains are depending on revenues from license sales New deals in the US not expected until the second half of 2015 and most likely towards the end of the year Front Office and IBOR will be driving new deals High activity level with existing customers 47

48 Longer term outlook Continue double digit revenue growth year on year for a sustained period Continuously improve profitability Continued investment commitment to R&D SimCorp will not become a legacy provider 48

49 49 Q & A

50 50 simcorp.com