Iress : 2021 Half Year Results Investor Presentation

Half year results presentation

For the six months ended 30 June 2021

Agenda

Overview of Iress	3
1H 21 results summary	4
Performance review	11
Growth and outlook	22
Appendix	31

Andrew Walsh		John Harris
Managing Director & CEO		Chief Financial Officer

2

Overview of Iress

Iress' vision: simpler, faster with higher returns

Highlights

• Core business leverages common technology in Trading, Wealth and Data to build scale in large markets with similar regulatory frameworks
• Opportunity to accelerate a successful business from a strong foundation, underpinned by a single technology platform
• Existing growth strategies in UK, superannuation, investment infrastructure
• Material acceleration of benefits - FY25 targets more than double NPAT in 2025, with potential upside to 3x
• Capital management to enhance EPS

Consistent revenue growth with ~90% recurring (2, 3)

(1)

Key statistics

• 10,000+ clients, growing client base with new wins
• Annual Contract Value $602.8m(4)

● LTV(4) of total portfolio $20.7bn

(1)

• LTV / CAC(4) 26.9x - high ROI model with ~90% recurring revenue

1. Figures are presented on a constant currency basis, assuming results are converted at the average foreign exchange rates used for 1H 20. Seepage 51 for FX rates. (2)Recurring revenue is made up of revenue from subscription and licence fees.

(3)	Non recurring revenue is revenue from project implementation fees and consulting.	3
(4)	Refer to glossary on pages	52 & 5	3 for definitions.

1H 21 constant currency and pro forma financial performance

Delivered pro forma segment profit and NPAT growth - full year guidance affirmed

296.2 298.7

Pro forma revenue (1)

Up 1%

1H 2020	1H 2021
24.9	27.1
Pro forma NPAT (1)
Up 9%
1H 2020	1H 2021
13.3	14.2
Pro forma earnings per share (1) (3)
Up 6%
1H 2020	1H 2021

Constant currency

(using average 2020 FX rates)

segment profit (5)

Up 6%

Pro forma

segment profit & margin

Up 3%

Pro forma ROIC (1) (4)

9%

		2021 guidance affirmed
			164-168
	71.9		76.1
	1H 2020	1H 2021 FY 2021
	75.1		77.2
(1) (2)	25.4%		25.9%
	1H 2020	1H 2021
	9%		9%
	1H 2020	1H 2021

(1)	Pro forma adjustments adds back the pre acquisition earnings for OneVue and O&M to the comparative period and excludes currency movements (assuming results are converted at the average foreign exchange rates used for 1H 20).
The 1H 21 Pro forma NPAT also excludes a $15.2m provision release associated with finalisation of QuantHouse earnout arrangements. Refer to pages 34 - 37 for reconciliations from reported to pro forma results.
(2)	Pro forma segment profit margin has been calculated using pro forma segment profit / pro forma revenue.
(3)	Pro forma earnings per share has been calculated using pro forma NPAT / Weighted average number of ordinary shares used in basic earnings per share. The shares in 1H 20 have been adjusted to include the 11.2m shares issued to fund the acquisition of OneVue.
4
(4)	Pro forma ROIC has been calculated using the rolling 12 month pro forma NPAT (excluding interest and finance costs) as a percentage of the addition of net debt and equity. Equity in 1H 20 has been adjusted to include the $115.2m used to fund the acquisition of OneVue.

1. Segment profit is calculated using the average 2020 currency rates. This is for the purpose of comparing to the FY21 guidance which was forecasted using these FX rates.

1H 21 reported financial performance

Reported revenue +7%, leveraging Product & Technology investments

270.7 290.2

Reported revenue

Up 7%

Reported

segment profit & margin

Up 5%

71.9	75.5
26.6%	26.0%

Reported NPAT (1)

Up 55%

Including $15m from finalisation of QuantHouse earnout

Reported earnings per share (1)

Up 42%

1H 2020	1H 2021
	40.9
26.4
1H 2020	1H 2021
15.1	21.4

Product & Technology

• of revenue24%

Reported ROIC (2)

11%

	1H 2020		1H 2021

25% 24%

	1H 2020		1H 2021

11% 11%

1H 2020

1H 2021

1H 2020

1H 2021

(1)

In 1H 20 reported NPAT was $26.4m with 175.2m shares. In 1H 21 reported NPAT is $40.9m with 190.9m shares. The variance between 1H 20 and 1H 21 reported NPAT is largely due to the $15.2m provision release associated with finalisation of QuantHouse earnout arrangements in 1H 21.

5

(2)

ROIC has been calculated using reported NPAT (excluding interest and finance costs) as a percentage of the addition of net debt and equity.