Q415 Lender Update. June 26, Copyright Infor. All Rights Reserved.

Transcription

1 Q415 Lender Update June 26,

2 Financial Update 2

3 Q4 FY15 Executive Summary Note With the change in our fiscal year end, we have recast prior period results to reflect the comparable three month period ended April 30, 2014 Q415 total pro forma revenue was $659.7M On a constant currency basis, Q415 total pro forma revenue was $721.1M, an increase of 4.9% from Q414 Increase driven by higher SaaS subscriptions revenues, as well as increased perpetual license fees and product updates and support fees Q415 pro forma software license fees and subscriptions revenue was $145.8M On a constant currency basis, Q415 pro forma software license fees and subscriptions revenue was $162.0M, an increase of 15.7 % from Q414 We continue to have strong growth in SaaS bookings and revenues as well as an increase in our perpetual license fees Q415 pro forma product update and support revenue was $345.2M On a constant currency basis, Q415 pro forma product update and support revenue was $371.1M, an increase of 3.2% from Q414 Retention rates continue to remain strong Q415 pro forma consulting services and other fees revenue was $168.7M On a constant currency basis, Q415 pro forma consulting services and other revenue was $188.0M, an increase of 0.2 % from Q414 Global consulting services revenue was flat, which is an improvement from the decline we saw in the last couple of quarters Q415 Adjusted Pro Forma EBITDA was $177.3 (26.9% margin) On a constant currency basis, Q415 Adjusted Pro Forma EBITDA of $197.3M, an increase of 8.0% from Q414 Increase in EBITDA driven by strong SaaS subscription revenues and increased perpetual license fees revenues Cash balance at the end of Q415 was $526.7M Collections and cash generation remain strong 3

4 Q415 v. Q414 P&L: GAAP Actual Results (1) Currency-adjusted Results $ in millions Actual Actual % Currency Adjusted Actual % Q415 Q414 Variance Variance Impact (2) Q415 Q414 Variance Variance Revenue (recast) (recast) Software license fees and subscriptions $ $ $ % $ (16.2) $ $ $ % Product updates and support fees (15.2) -4.2% (25.9) % Software revenues (8.2) -1.6% (42.1) % Consulting services and other fees (18.5) -9.9% (19.3) % Total revenues (26.7) -3.9% (61.4) % Expenses Cost of software license fees and subscriptions % (1.5) % Cost of product updates and support fees (6.0) -8.9% (4.8) (1.2) -1.8% Cost of consulting services and other fees (12.2) -8.1% (15.7) % Sales and marketing costs (9.3) -7.7% (7.8) (1.5) -1.2% Research and development (8.5) -8.1% (6.7) (1.8) -1.7% General and administrative (12.3) -21.7% (4.9) (7.4) -13.1% Amortization of intangible assets and depreciation (10.0) -14.5% (3.9) (6.1) -8.8% Restructuring costs (0.1) 6.2 (6.3) nm (0.2) (6.1) -98.4% Acquisition-related and other costs (2.6) -41.9% (2.6) -41.9% Total operating expenses (58.6) -9.6% (45.5) (13.1) -2.2% Income from operations % (15.9) % Interest expense, net (1.8) -2.0% (1.9) -2.2% Loss on extinguishment of debt nm nm Other (income) expense, net (2.6) (3.0) % (12.5) 9.9 (3.0) 12.9 nm Income (loss) before income taxes (146.9) (7.8) (139.1) nm (3.5) (143.4) (7.8) (135.6) nm Income tax provision (benefit) (83.4) (9.2) (74.2) nm (2.0) (81.4) (9.2) (72.2) nm Net income (loss) $ (63.5) $ 1.4 $ (64.9) nm $ (1.5) $ (62.0) $ 1.4 $ (63.4) nm (1) Actual Results for Q415 reflect the three months ended April 30, Actual Results for Q414 have been recast to reflect the corresponding three months ended April 30, 2014 (2) Currency impact is computed by converting actual results using Q414 exchange rates 4

5 Q415 v. Q414 P&L: Pro Forma Pro Forma Results (1)(2) Currency-adjusted Results $ in millions Actual Actual % Currency Adjusted Actual % Q415 (4) Q414 (4) Variance Variance Impact (3) Q415 Q414 Variance Variance Revenue Software license fees and subscriptions $ $ $ % $ (16.2) $ $ $ % Product updates and support fees (14.4) -4.0% (25.9) % Software revenues (8.6) -1.7% (42.1) % Consulting services and other fees (18.9) -10.1% (19.3) % Total revenues (27.5) -4.0% (61.4) % Expenses Cost of software license fees and subscriptions % (1.5) % Cost of product updates and support fees (6.0) -8.9% (4.8) (1.2) -1.8% Cost of consulting services and other fees (12.2) -8.1% (15.7) % Sales and marketing costs (9.3) -7.7% (7.8) (1.5) -1.2% Research and development (8.5) -8.1% (6.7) (1.8) -1.7% General and administrative (12.3) -21.7% (4.9) (7.4) -13.1% Amortization of intangible assets and depreciation (10.0) -14.5% (3.9) (6.1) -8.8% Restructuring costs (0.1) 6.3 (6.4) nm (0.2) (6.2) -98.4% Acquisition related and other costs (2.5) -41.0% (2.5) -41.0% Total operating expenses (58.6) -9.6% (45.5) (13.1) -2.2% Income from operations % (15.9) % Interest expense, net (1.8) -2.0% (1.9) -2.2% Loss on extinguishment of debt nm nm Other (income) expense, net (2.6) (3.0) % (12.5) 9.9 (3.0) % Income (loss) before income taxes (145.9) (6.0) (139.9) nm (3.5) (142.4) (6.0) (136.4) nm Income tax provision (benefit) (83.4) (9.2) (74.2) nm (2.0) (81.4) (9.2) (72.2) nm Net income (loss) $ (62.5) $ 3.2 $ (65.7) nm $ (1.5) $ (61.0) $ 3.2 $ (64.2) #DIV/0! nm Add backs % (18.5) % Adjusted EBITDA $ $ $ (5.4) -3.0% $ (20.0) $ $ $ % Adjusted EBITDA margin 26.9% 26.6% 27.4% 26.6% (1) Pro Forma Results contain reversal of acquisition-related adjustments (2) Pro Forma Results for Q415 reflect the three months ended April 30, Pro Forma Results for Q314 have been recast to reflect the corresponding three months ended April 30, 2014 (3) Currency impact is computed by converting actual results using Q414 exchange rates (4) Q415 and Q414 results include equity compensation expense by category as follows: Cost of product updates and support fees $ 0.1 $ 0.3 Cost of consulting services and other fees Sales and marketing Research and development General and administrative Equity-based compensation $ 1.9 $

6 Q415 v. Q414 EBITDA: Pro Forma Pro Forma Results (1) Currency-adjusted Results $ in millions Actual Actual % Currency Adjusted Actual % Q415 Q414 Variance Variance Impact (2) Q415 Q414 Net income (loss) $ (62.5) $ 3.2 $ (65.7) nm $ (1.5) $ (61.0) $ 3.2 $ (64.2) nm Reconciliation of net income (loss) to adjusted Pro Forma EBITDA Variance Net Interest (3) (1.8) -2.0% (1.9) -2.1% Income tax provision (benefit) (83.4) (9.2) (74.2) nm (2.0) (81.4) (9.2) (72.2) nm Depreciation and amortization (10.0) -14.5% (3.9) (6.1) -8.8% Loss on extinguishment of debt nm nm FX (gains) losses (2.6) (3.0) % (12.5) 9.9 (3.0) % Pro Forma EBITDA % (19.8) % Equity-based compensation (14.5) -88.4% (14.5) -88.4% Acquisition transaction and integration costs (2.5) -41.0% (2.5) -41.0% Non-recurring, extraordinary, exceptional, unusual (gains) losses (2.7) -90.0% (2.7) -90.0% Restructuring (0.1) 6.3 (6.4) nm (0.2) (6.2) -98.4% Other non-operating expenses (0.3) -14.3% (0.3) -14.3% Acquisition cost savings (4) (0.1) % (0.1) % Adjusted Pro Forma EBITDA $ $ $ (5.4) -3.0% $ (20.0) $ $ $ % Variance (1) Pro Forma Results for Q415 reflect the three months ended April 30, Pro Forma Results for Q414 have been recast to reflect the corresponding three months ended April 30, 2014 (2) Currency impact is computed by converting actual results using Q414 exchange rates (3) Includes fees associated with debt as defined by Infor Note's Indentures (4) Anticipated cost savings from fiscal 2013 and 2014 acquisitions yet to be realized 6

7 FY15 v. FY14 P&L: GAAP 11-Month Transition Period Actual Results (1) Currency-adjusted Results $ in millions Actual Actual % Currency Adjusted Actual % FY15 11-month FY14 11-month Variance Variance Impact (2) FY15 11-month FY14 11-month Variance Variance Revenue (recast) (recast) Software license fees and subscriptions $ $ $ % $ (24.2) $ $ $ % Product updates and support fees 1, ,340.9 (10.6) -0.8% (44.3) 1, , % Software revenues 1, , % (68.5) 1, , % Consulting services and other fees (47.6) -7.0% (33.1) (14.5) -2.1% Total revenues 2, ,445.7 (6.8) -0.3% (101.6) 2, , % Expenses Cost of software license fees and subscriptions % (2.9) % Cost of product updates and support fees (0.9) -0.4% (8.1) % Cost of consulting services and other fees (33.1) -6.1% (25.3) (7.8) -1.4% Sales and marketing costs % (12.8) % Research and development % (11.6) % General and administrative % (8.1) % Amortization of intangible assets and depreciation (18.6) -7.7% (6.6) (12.0) -5.0% Restructuring costs (7.1) -55.5% (0.2) (6.9) -53.9% Acquisition-related and other costs (25.9) -94.9% (25.9) -94.9% Total operating expenses 2, ,077.5 (31.8) -1.5% (75.6) 2, , % Income from operations % (26.0) % Interest expense, net (28.3) -8.1% (28.3) -8.1% Loss on extinguishment of debt nm nm Other (income) expense, net (66.8) (52.0) (14.8) 28.5% (11.9) (54.9) (52.0) (2.9) 5.6% Income (loss) before income taxes (32.5) 66.6 (99.1) nm (14.1) (18.4) 66.6 (85.0) nm Income tax provision (benefit) (52.2) (0.4) (51.8) nm (2.1) (50.1) (0.4) (49.7) nm Net income $ 19.7 $ 67.0 $ (47.3) -70.6% $ (12.0) $ 31.7 $ 67.0 $ (35.3) -52.7% (1) Actual Results for YTD FY15 reflect the eleven-month transition period of June 1, 2014, through April 30, Actual Results for YTD FY14 have been recast to reflect the corresponding eleven months ended April 30, 2014 (2) Currency impact is computed by converting actual results using FY14 exchange rates 7

8 LTM April 2015 v. April 2014 P&L: Pro Forma Pro Forma Results (1)(2) Currency-adjusted Results $ in millions Actual Actual % Currency Adjusted Actual % FY15 (4) FY14 (4) Variance Variance Impact (3) FY15 FY14 Variance Variance Revenue Software license fees and subscriptions $ $ $ % $ (24.8) $ $ $ % Product updates and support fees 1, ,467.3 (8.4) -0.6% (42.8) 1, , % Software revenues 2, , % (67.6) 2, , % Consulting services and other fees (50.2) -6.7% (32.2) (18.0) -2.4% Total revenues 2, ,767.8 (7.8) -0.3% (99.8) 2, , % Expenses Cost of software license fees and subscriptions % (3.0) % Cost of product updates and support fees % (7.9) % Cost of consulting services and other fees (33.5) -5.6% (24.5) (9.0) -1.5% Sales and marketing costs % (12.4) % Research and development % (11.4) % General and administrative % (7.8) % Amortization of intangible assets and depreciation (18.0) -6.8% (6.3) (11.7) -4.4% Restructuring costs (1.9) -14.2% (0.1) (1.8) -13.4% Acquisition-related and other costs (24.6) -93.5% (24.6) -93.5% Total operating expenses 2, ,299.8 (24.7) -1.1% (73.4) 2, , % Income from operations % (26.4) % Interest expense, net (33.2) -8.7% (33.3) -8.7% Loss on extinguishment of debt nm nm Other (income) expense, net (77.5) (46.1) (31.4) 68.1% (12.2) (65.3) (46.1) (19.2) 41.6% Income before income taxes (85.7) -68.0% (14.3) (71.4) -56.7% Income tax provision (benefit) (39.2) 7.3 (46.5) nm (3.6) (35.6) 7.3 (42.9) nm Net income $ 79.5 $ $ (39.2) -33.0% $ (10.7) $ 90.2 $ $ (28.5) #DIV/0! -24.0% Add backs % (22.1) % Adjusted EBITDA $ $ $ (25.9) -3.2% $ (32.8) $ $ $ % Adjusted EBITDA margin 28.5% 29.3% 28.6% 29.3% (1) Pro Forma Results contain reversal of acquisition-related adjustments (2) Pro Forma Results for FY15 reflect the twelve months ended April 30, Pro Forma Results for FY14 have been recast to reflect the corresponding twelve months ended April 30, 2014 (3) Currency impact is computed by converting actual results using FY14 exchange rates (4) FY15 and FY14 results include equity compensation expense by category as follows: Cost of software license fees and subscriptions $ 0.2 $ - Cost of product updates and support fees Cost of consulting services and other fees Sales and marketing costs Research and development General and administrative Equity-based compensation $ 18.7 $

9 LTM April 2015 v. April 2014: SaaS v. Perpetual License Pro Forma Results (1)(2) Currency-adjusted Results Actual Actual % Currency Adjusted Actual % FY15 FY14 Variance Variance Impact (3) FY15 FY14 Variance (recast) (recast) License fees $ $ $ % $ (24.1) $ $ $ % SaaS subscriptions % (0.7) % Software license fees and subscriptions $ $ $ % $ (24.8) $ $ $ % SaaS as a % of software license fees and subscriptions 19.5% 13.7% 18.8% 13.7% Variance (1) Pro Forma Results contain reversal of acquisition-related adjustments (2) Pro Forma Results for FY15 reflect the twelve months ended April 30, Pro Forma Results for FY14 have been recast to reflect the corresponding twelve months ended April 30, 2014 (3) Currency impact is computed by converting actual results using applicable FY14 exchange rates (4) GAAP Software license fees and subscriptions for LTM April 30, 2015 and April 30, 2014 were as follows: LTM FY15 LTM FY14 License fees $ $ SaaS subscriptions Software license fees and subscriptions $ $

10 LTM April 2015 v. April 2014 EBITDA: Pro Forma Pro Forma Results (1) Currency-adjusted Results $ in millions Actual Actual % Currency Adjusted Actual % FY15 FY14 Variance Variance Impact (2) FY15 FY14 Net income $ 79.5 $ $ (39.2) -33.0% $ (10.7) $ 90.2 $ $ (28.5) -24.0% Reconciliation of net income to adjusted Pro Forma EBITDA Variance Net Interest (3) (33.3) -8.7% (33.4) -8.7% Income tax provision (benefit) (39.2) 7.3 (46.5) nm (3.6) (35.6) 7.3 (42.9) nm Depreciation and amortization (18.0) -6.8% (6.3) (11.7) -4.4% Loss on extinguishment of debt nm nm FX (gains) losses (77.4) (46.2) (31.2) 67.5% (12.2) (65.2) (46.2) (19.0) 41.1% Pro Forma EBITDA (1.0) -0.1% (32.7) % Equity-based compensation (9.9) -34.6% (9.9) -34.6% Acquisition transaction and integration costs (24.6) -93.5% (24.6) -93.5% Non-recurring, extraordinary, exceptional, unusual (gains) losses nm nm Restructuring (1.9) -14.2% (0.1) (1.8) -13.4% Other non-operating expenses (0.3) -3.8% (0.3) -3.8% Acquisition cost savings (4) (1.3) -92.9% (1.3) -92.9% Adjusted Pro Forma EBITDA $ $ $ (25.9) -3.2% $ (32.8) $ $ $ % (1) Pro Forma Results for FY15 reflect the twelve months ended April 30, Pro Forma Results for FY14 have been recast to reflect the corresponding twelve months ended April 30, 2014 (2) Currency impact is computed by converting actual results using FY14 exchange rates (3) Includes fees associated with debt as defined by Infor Note's Indentures (4) Anticipated cost savings from fiscal 2013 and 2014 acquisitions yet to be realized Variance 10

11 Quarterly Overview: LTM Results $ in millions Quarter Ended July 31, 2014 (1) Quarter Ended October 31, 2014 Quarter Ended January 31, 2015 Quarter Ended April 30, 2015 LTM Ended April 30, 2015 (1)(2) Revenues Software license fees and subscriptions $ $ $ $ $ Product updates and support ,455.3 Software revenues ,054.9 Consulting services and other fees Total revenues ,754.9 Expenses Cost of software license fees and subscriptions 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) 11.5 Acquisition related and other costs 0.7 (1.4) (1.2) Total operating expenses ,275.1 Income from operations Interest expense, net Loss on extinguishment of debt Other (income) expense, net (32.1) (2.0) (40.8) (2.6) (77.5) Income (loss) before income taxes (146.9) 35.2 Income tax provision (benefit) (83.4) (39.2) Net income (loss) $ 73.5 $ 13.1 $ 51.3 $ (63.5) $ 74.4 (1) Results of May 2014, the last month of our previous fiscal year, is included in the quarter ended July 31, 2014, based on applicable definitions in Infor Notes' Indentures (2) Presented in compliance with Infor Notes' Indentures including pro forma results which contain reversal of acquisition-related adjustments 11

12 Quarterly Overview: LTM Results $ in millions Quarter Ended July 31, 2014 (1) Quarter Ended October 31, 2014 Quarter Ended January 31, 2015 Quarter Ended April 30, 2015 LTM Ended April 30, 2015 (1)(2)(3) Net income (loss) $ 73.5 $ 13.1 $ 51.3 $ (63.5) $ 74.4 Reconciliation of net income (loss) to Adjusted EBITDA: Net Interest (4) Income tax provision (benefit) (83.4) (39.2) Depreciation and amortization Purchase accounting impact - License fees Purchase accounting impact - Product updates and support fees Purchase accounting impact - Consulting Equity-based compensation Acquisition transaction and integration costs 0.7 (1.4) (1.2) Non-recurring, extraordinary, exceptional, unusual (gains) losses Restructuring (0.1) 11.5 Other non-operating expenses FX (gains) losses (32.0) (2.0) (40.8) (2.6) (77.4) Loss on extinguishment of debt Acquisition cost savings (5) Adjusted EBITDA $ $ $ $ $ Adjusted EBITDA margin 31.6% 28.5% 26.7% 26.9% 28.5% (1) Results of May 2014, the last month of our previous fiscal year, is included in the quarter ended July 31, 2014, based on applicable definitions in Infor Notes' Indentures (2) Presented in compliance with Infor Notes' Indentures including pro forma results which contain reversal of acquisition-related adjustments (3) Consolidated LTM EBITDA as of April 30, 2015, pursuant to the provisions of Infor's Credit Agreement was approximately $788.4 (4) Includes fees associated with debt as defined by Infor Note's Indentures (5) Anticipated cost savings from fiscal 2013 and 2014 acquisitions yet to be realized 12

13 Balance Sheet: GAAP April 30, May 31, $ in millions Assets Current assets Cash and cash equivalents $ $ Accounts receivable, net Other current assets Total current assets 1, ,182.3 Property and equipment, net of accumulated depreciation Intangible assets, net of accumulated amortization 4, ,267.9 Other long-term assets Total assets $ 6,048.5 $ 6,656.9 Liabilities and Stockholders' Deficit Current liabilities Accounts payable and accrued liabilities Deferred revenue Current portion of long-term debt Total current liabilities 1, ,488.2 Long-term debt 5, ,218.4 Other long-term liabilities Total liabilities 6, ,116.9 Stockholders' deficit (796.8) (460.0) Total liabilities and stockholders' deficit $ 6,048.5 $ 6,

14 Statement of Cash Flows: GAAP $ in millions Fiscal Years Ended (1) April 30, 2015 April 30, 2014 Cash flows from operating activities (recast) Net income $ 19.7 $ 67.0 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization Non cash items and change in working capital (34.4) (27.7) Net cash provided by operating activities Cash flows from investing activities Acquisition, net of cash acquired (30.1) (199.7) Purchases of property, equipment and software (35.7) (29.9) Other investing activities 17.1 (20.2) Net cash used in investing activities (48.7) (249.8) Cash flows from financing activities Deferred financing fees and other financing activities (177.2) (38.4) Proceeds from issuance of debt 2, ,487.7 Loans to stockholders - (5.2) Payment of debt obligations (1,935.0) (3,459.8) Dividends paid (65.7) - Net cash used in financing activities (158.2) (15.7) Net Increase in cash and cash equivalents Effect of exchange rate on cash and cash equivalents (49.9) 9.9 Net (decrease) increase in cash and cash equivalents (48.6) 25.2 Cash and cash equivalents Beginning of the period End of the period $ $ (1) Cash flows for FY15 reflect the eleven-month transition period of June 1, 2014, through April 30, Cash flows for YTD FY14 have been recast to reflect the corresponding eleven months ended April 30,

15 Debt Summary Outstanding USD Outstanding Tranche Currency Pricing (1) April 30, 2015 April 30, 2015 Maturity First Lien - Tranche B-5 Term Loan USD AER (2) margin $ 2,473.0 $ 2, /3/2020 First Lien - Tranche B-3 Term Loan USD AER (2) margin $ $ /3/2020 First Lien - Euro-B Term Loan EUR (3) AER (2) margin $ /3/2020 Infor (US), Inc. Senior Notes USD 6.500% $ 1,630.0 $ 1, /15/2022 Infor (US), Inc. Senior Notes EUR (3) 5.750% $ /15/2022 Deferred Financing Fees USD $ (102.4) $ (102.4) Tranche B-5 Term Loan Discount USD $ (29.2) $ (29.2) Senior Notes Premium USD $ 13.4 $ 13.4 Total Debt $ 5,226.8 Less: Cash Balance $ (526.7) Net Debt $ 4,700.1 LTM EBITDA (4) $ LTM EBITDA to Total Debt (5) 6.8 X LTM EBITDA to Net Debt (5) 6.1 X LTM EBITDA to Senior Debt 4.2 X (1) Reflects current pricing based our Credit Agreement, as amended, and the refinancing of our senior notes in April 2015 (2) Adjusted Eurocurrency Rate (AER) - The AER floor is 1.00% per annum (3) Euro exchange rate as of April 30, 2015, equaled (4) LTM EBITDA includes the results of May 2014, the last month of our previous fiscal year, in the quarter ended July 31, 2014, based on applicable definitions in Infor Notes' Indentures (5) Ratio calculations based on gross debt of $5,345.0 excluding net deferred financing fees, debt discounts and premiums of $

16 Operating Metrics 16

17 Revenue Metrics (1) By region (FY15) By region (FY14) 32% 8% 60% Americas EMEA APAC 34% 8% 58% Americas EMEA APAC By type (FY15) By type (FY14) 25% 22% License 27% 20% License Maintenance Maintenance Services Services 53% 53% (1) Revenue Metrics are based on Pro Forma Revenue using actual rates 17

18 Operational Metrics (1)(2) Direct/Channel mix Perpetual license + ACV SaaS bookings Customer mix Perpetual license + ACV SaaS bookings 100% 80% 25% 25% 22% 22% 22% 100% 80% 21% 20% 21% 18% 19% 60% 60% 40% 75% 75% 78% 78% 78% 40% 79% 80% 79% 82% 81% 20% 20% 0% Q414 Q115 Q215 Q315 Q415 0% Q414 Q115 Q215 Q315 Q415 Top = channel Bottom = direct Top = new customers, Bottom = existing customers Professional services utilization 90% 75% 60% 45% 61% 61% 61% 60% 65% 30% 15% 0% Q414 Q115 Q215 Q315 Q415 (1) Operational Metrics reflected above for all prior periods of FY14 relate to the previously reported fiscal periods and have not been recast for our new fiscal year end (2) Operational Metrics reflected above for Q115, Q215, Q415, and Q415 relate to the three months ended July 31, October 31, 2014, January 31, 2015, and April 30,

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