eservglobal Investor Roadshow November, 2013
eservglobal is an internationally recognised, leading provider of solutions that bridge the telco and financial worlds
eservglobal: at a glance Comprehensive suite of solutions bridging the telco and financial worlds. Solid, established and growing base of end-users worldwide who get more from their mobile everyday through eservglobal technology Strategic partnership with BICS for HomeSend, the industry leading solution for international mobile money transfer with 1.2 billion subscribers under contract coverage and live corridors connecting 51 countries for remittance and 76 countries for airtime transfer. 100+ customers in 90+ countries 30 years experience 190+ Staff Offices in 11 countries 3
Foundation for take-off: Large growing market Established technology leader Strengthening financial position Huge underserved market exists Large growing core customer base HomeSend service has reached critical mass and momentum continues to build Disruptive technology Recognized industry leader Existing, successful references in the new mobile money space Solid core business with growing presence in domestic mobile money Stronger balance sheet
2013 was a successful year: Key Highlights eservglobal s core mobile money business added 10 new customers in 10 markets this year, a significant Group frame agreement with the Zain Group and four projects to deploy new products at existing customers in addition to regular extension projects The HomeSend service is now live in 51 countries for remittance and 76 for airtime transfer exceeding the objective for 2013 to reach 50 before year end, allowing users worldwide to send remittances or airtime to their friends and family around the globe via HomeSend corridors. The business continues to perform in line with management expectations. The new contracts have contributed to a healthy backlog of work which will flow into FY14. 5
Our goal is that any person in the world can use their mobile to simply and safely access financial services.
The Potential of the Mobile Money Universe Emerging financial market In emerging markets users generally have access to basic banking and they are looking for ways that their mobile can make their financial lives easier through services such as mobile payments. Mobile Payment Transactions Values Worldwide Per year (Billions $US) 721 163 235 2012 2013 2017e Mobile Payment Users Worldwide Per year (Millions) 450 200 245 In under developed financial markets, more than one billion customers have access to a mobile phone, but do not have a formal bank account. In these countries people have to rely on cash or informal financial service which are typically unsafe, inconvenient and expensive. Mobile money is taking off in these countries. Active Mobile Money Users Worldwide Subscribers (M) 450 400 350 300 250 200 150 100 50 0 61 84 Source: Berg Insight 110 154 215 282 381 2011 2012 2013 2014 2015 2016 2017 7 Source: Gartner 2012 2013 2017e Under developed financial market
eservglobal has the technology to meet this need Emerging financial market Access mobile wallet via Companion Card Our focus is on building an end-to-end mobile financial ecosystem, positioning eservglobal to deliver comprehensive solutions. Send money internationally direct from handset Withdraw cash at ATM from mobile wallet Receive loyalty rewards at Coffee Shop by using mobile wallet Recharge prepaid account at an Agent Pay Electricity Bill via handset Use NFC handset for public transport ticketing Receive payment from Government 8 Use Mobile Financial Services to insure crops Receive payment from customer via P2P transfer Under developed financial market
Delivering in both license and service models eservglobal core business solutions are offered on a traditional capex license model and revenue share basis. We offer a complete portfolio of domestic mobile money and VAS solutions for operators and financial service providers. International remittance, delivered via HomeSend. Offered as a hub model through partnership with BICS. 9
International Remittance HomeSend is fundamentally changing the way money is sent abroad. HomeSend is a mobile money transfer hub with contract coverage exceeding over 1.2 billion subscribers, bank customers, and Money Transfer Organization users around the world. A strategic partnership with Send with HomeSend Sending money internationally is transparent and instant 24x7 Money is sent from Belgium: Imane sends 100 to her brother Receive on Mobile Account Received funds move straight into the mobile ecosystem Her brother in Morocco receives funds in local currency 10
HomeSend The solution to international mobile money transfer Every year, almost half a trillion dollars are transferred around the world in ways that are expensive, time consuming and inefficient. HomeSend is working with Money Transfer Organizations, Banks and Mobile Operators so people can seamlessly transfer money. In 2013, we entered the next strategic stage of development, deployments. Services are now live in 51 countries for remittance and 76 countries for airtime transfer, exceeding our objective of 50 countries by end of 2013. The individual Service Providers in these countries are connected by over 690 live corridors. Remittance Flows to Developing Countries US $Bn 600 400 381 406 438 482 534 200 0 2011 2012 2013 2014 2015 11 Source: World Bank
HomeSend customer base Select Multinational Customers 17 countries 60m subs 30 countries 400m subs 21 countries 200m subs 130 countries Online presence 16 countries 90m subs 100 countries 135K agents 15 countries 8m subs 70 countries 40k agents Geographic Spread Middle East Americas Europe APAC Africa 12 Source: Company Websites
HomeSend: steps to success Announced in 2010, HomeSend has the first mover advantage in the mobile money transfers market. In 2012 HomeSend exceeded objectives for subscribers under contract coverage, with over 1.2 billion potential users around the world. In 2013 we moved to the next strategic step in the HomeSend roadmap live corridors. Live in 51 countries for remittance and 76 countries for airtime transfer 13 We have now crossed the threshold of 690 live service provide to service provider corridors for remittance and airtime transfer. HomeSend remittance now reaches 51 countries and airtime transfer services reach 76 countries Build the platform First mover advantage Successfully deploy in critical mass of markets Sign up Receivers Work with hub members to facilitate their marketing to drive transactions Sign up Senders
HomeSend corridors are lighting up around the globe The HomeSend remittance service is live in 51 countries Our airtime transfer service is available, reaching 76 countries In total there are over 690 live corridors, combining remittance and airtime transfer, currently connecting individual service providers around the world. 14 More corridors are going live every month.
eservglobal core product portfolio Our license-based solutions
16 Core business portfolio: End-to-end mobile money solutions
Global, established, growing customer base eservglobal s core business has a global customer base in excess of 70 customers in more than 55 countries (excluding HomeSend). In 2013 eservglobal added 10 new customers in 10 new countries. We have established, successful references in the burgeoning and rapidly expanding mobile money market In 2013 we announced a three-year framework agreement with the Zain Group Zain Group coverage extends to more than 44 million subscribers and includes several markets where over 90% of the population does not have access to banking facilities. 17
Our sales process A typical eservglobal customer lifecycle CUSTOMER EVENTS Customer chooses eservglobal for project Solution live and eservglobal provides support as per contract Customer s subscriber numbers double, exceeding their license After X years of operation, the platform needs to be upgraded As the market matures, customer wants to add new features eg. Micro Finance Project start phase Project live REVENUE RECOGNISED ESERVGLOBAL MILESTONE 18
Revenue breakdown by type Based on a typical recent year Approximately half of revenues were recurring in nature. Services 12% Hardware 5% Support 44% Licenses 34% 19 SaaS 5%
Recent milestones 2008: eservglobal and BICS announce strategic partnership to jointly launch HomeSend 2010: eservglobal announces its first customer for mobile money in the Middle East 2011: Mobile money platform launched by financial institution, mcoin, in Indonesia 2012: Following a string of significant announcements, HomeSend potential subscriber coverage surpasses 1 billion subscribers 2012: Mobile Money Bill Payment facility at Nepal Telecom exceeds expectations in first months of service 2012: Completed a significant fundraising, up to A$16.8m, which enabled us to pursue new, larger deals for both the core business and for HomeSend. 2013: eservglobal s recharge and mobile money suite is managing over 3.4 billion euros in transactions a year 2013: eservglobal announces significant threeyear framework agreement with the Zain Group for mobile money 2013: HomeSend exceeds strategic objective for live services in 50 markets, announcing live corridors connecting service providers in 51 countries for remittance and 76 countries for airtime transfer 20
Summary P&L as at H1FY13 FY12 H1 FY13 H1 FY13 H1 A$M A$M M Revenue $12.6 M $13.6 M 9.1 M Comparison H1 FY12 to H1 FY13* Revenue ex legacy $11.0 M $13.6 M 9.1 M +24% Cost of sales $7.6 M $5.3 M 3.5 M -30% Gross profit $5.0 M $8.3 M 5.6 M +67% Operating Costs* $13.0 M $8.6 M 6.0 M -33% Reported EBITDA -$8.1 M -$0.3 M - 0.2 M +A$7.2m Net Interest -$0.4 M -$0.3 M - 0.2 M Amortization -$2.3 M -$1.2 M - 0.8 M Depreciation -$0.4 M -$0.3 M - 0.2 M Reported PBT -$11.1 M -$2.1M - 1.4M +A$9.0m 21 *Unadjusted operating costs are shown. Non-recurring items, foreign exchange gains and losses and share based payments in H1 FY2013 resulted in a net gain of A$0.4m, primarily as a result of foreign exchange fluctuations with the Australian Dollar.
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