ASPERMONT LIMITED. — Call Transcript 2024

Oct 14, 2024

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15 October 2024

INVESTOR PRESENTATION TRANSCRIPT

Please see below the transcript from today’s investor presentation.

For further information please contact:

Aspermont Limited

Alex Kent, Managing Director +44 208 187 2330

David Straface, Company Secretary +61 8 6263 9100

About Aspermont

Aspermont is the leading media services provider to the global resource industries. Aspermont has built a commercial XaaS model for B2B media which distributes high value content to a growing global audience. This versatile model can be scaled to serve new business sectors in new countries and languages. Aspermont’s increasing size of (paid) audiences has opened a data monetization opportunity that the company is now developing.

Aspermont is listed on the ASX and on the Frankfurt Stock Exchange. It is also quoted on Tradegate and other regional German exchanges. The company has offices in UK, Australia, Brazil, USA, Canada, Singapore and the Philippines.

For more information please see: www.aspermont.com

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October 24 - Aspermont Investor Presentation Transcript

Good morning, ladies and gentlemen, and thank you for joining today’s Aspermont Q1 investor update.

We're holding this call today to release our Q4 results, as part of our commitment to providing transparency to our investors. Given our current momentum, we are excited to share these results with you.

I will begin with a brief presentation to update you on our progress against the key growth initiatives we set last year. Afterward, we will open the floor for questions.

If you have difficulty following the slides, please refer to our recent ASX announcements, where the full presentation deck is available.

Slide 1 – Introduction

Aspermont has a 189-year publishing history and collectively 580 years of brand heritage across our 11 primary brands.

We are the largest B2B media organisation serving the global resource sectors, supported by over 100 independent journalists and analysts worldwide.

Over the past eight years, Aspermont has undertaken a full-scale business model transformation, resulting in 33 consecutive quarters of growth in subscriptions, our primary revenue stream. Over the last two years, we have been reshaping our product portfolio to maximise high-recurringrevenue business while investing free cash flow to build a new Data business. We have laid the foundations for sustained growth and profitability and Aspermont is now at an inflection point.

Slide 2 – Key Financial Highlights

At the end of the first half, we told investors that the business would return to revenue growth and profitability in the second half and that we would balance cash reserves with an inward investment program.

Today we are pleased to tell investors that the business has done exactly that. Q4 is our 33rd consecutive quarter of growth in subscription revenues, ARR, and ARPU.

Slide 3 – FY24 Preliminary Financial Highlights

We are at an inflection point because the investments we have made over the last few years are coming towards commercialisation. Our new Data products will drive significant improvements in ARR, gross margins and net margins over the next few years.

Slides 4 – Q4 Preliminary Financial Highlights

At the end of the first half, we mentioned that subscriptions, which achieved 2% growth, would gain new momentum in the second half.

Closing the year with a 7% growth in ARR compared to the previous year demonstrates that this new momentum has come through.

Slide 5 – Our Content-as-a-Service Model Solves an Information Gap

Let me quickly recap for people who are new on the line today. Aspermont operates a simple, effective business model:

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We produce high-quality, independent content for the industries we serve, ranging from news and editorial to research, data, and market intelligence.

All our content is paywalled, and we charge subscriptions fees based on the number of members and the type of content provided to each customer.

Our content has been trusted and monetised for nearly 200 years.

Slide 6 – The Market Leader in B2B Media for the Global Resource Sectors

Ten years ago, 8% of our revenue came from subscriptions—today, that figure is 55%. Since FY16, we have achieved a 12% compound annual growth rate in subscription revenues over 33 consecutive quarters, while maintaining a near 100% net retention rate. Subscriptions is a high-quality business with, today, 3 million engaged users and 5,000 current corporate subscribers, and still with substantial growth potential.

Slide 7 – 33 Consecutive Quarters of Scalable Subscriptions Growth

Aspermont’s business model has proved resilient, regardless of global resource sector cycles. We have achieved a 17% compound growth in product prices, because our customers extend the range of products they purchase, and they also increase the number of members per subscription. As almost all our products are now digital, gross margins are scaling accordingly. We expect further growth in average revenue per unit as we launch new Data and Intelligence products.

Slide 8 – Large Audience Expansion with Improving profit margins

in Mining Corporate Subscriptions Alone Aspermont has only scratched the surface of its market potential. Today, our 5,000 corporate subscriptions generate $11 million in Annual Recurring Revenue. But the Total Addressable Market, for mining corporate subscriptions alone, is potentially $180 million in ARR, and that figure assumes constant average revenue per unit.

As we have shown, our ARPU is in fact growing by nearly 20% per year, and we are not reliant on a few large accounts—growth is spread across our entire subscriber base.

Aspermont operates globally, across the mining, energy, and agriculture sectors, deriving revenues from subscriptions, live events, advertising, and marketing services. But our growth strategies focus heavily on mining corporate subscriptions.

Slide 9 – Growth Strategy 1: Grow Corporate Subscriptions

To grow mining corporate subscriptions, we will: -

*Increase coverage with more writers in more regions and industry segments.

• Leverage our technology to optimise customer acquisition and customer engagement and;

• Extend our outbound marketing campaigns to new jurisdictions.

Our number of writers and analysts has grown cautiously over the last few years as we’ve balanced cash flow and investment. The ROI on new content providers is roughly six months, and as the business’s profitability increases, so will the number of our content providers.

We have made tremendous improvements in customer acquisition and engagement performance through prior technological advancements. Our Horizon platform, first released eight years ago, has enabled our current growth path. Earlier this year, we announced that all our brands are now on Version 5 of this platform, which is starting to make an impact. Equally, the evolution of our processes is benefiting from new knowledge capital brought into the business through our recent senior leadership investments.

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To date, Aspermont has done very little outbound marketing for its brands, relying instead on our existing database to drive new business acquisitions. Going forward, we are committed to significantly raising our marketing activities. Currently, the marketing team is trialling ROI performance on various initiatives. By the end of the first half, we expect our new strategies to have settled and begun to bear fruit.

Slide 10 – Growth Strategy 2: Increase Account Penetration to build ARPU

Our strategy to increase account penetration and ARPU applies Account-Based Marketing techniques to expand the number of members per subscription, through upselling, and cross-selling with annual rate card increases to reflect the growing quality of our offerings. In 2016, only two clients paid more than $8k in subscription fees—today, nearly 100 clients pay more than that annually.

Our highest-paying client today spends almost $200k in annual subscriptions fees. We are making good progress.

Slide 11 – Growth Strategy 3: Increase Market Size

Our R&D and new product strategy focuses on game-changing innovations. We will target new geographies and offer multilingual services to expand our user base with these new products. By developing higher-value Data and Intelligence products, we will significantly increase subscription pricing.

Our immediate focus is on the North American market, where we are building marketing tools to boost penetration. We already have a well-received product portfolio in this region, and our outreach efforts should yield short-term positive impacts. From a cost perspective, we expect a three-month lag in ROI from marketing spends related to new customer acquisition, so these activities are being prioritized.

We have previously informed investors about our multilingual ambitions and the upcoming Project Esperanto, especially because only 25% of the world’s population speaks English. Given the rapid advancement of ChatGPT, we have paused our efforts on Esperanto to see what we can freely leverage from these pioneering tools.

Over the past two years, we have heavily invested in our Data and Intelligence teams, platforms, and research. Our focus is on data origination rather than aggregating or building competitor products from existing data. This approach capitalizes on our unique relationships and contacts within the global mining industry, providing us with a greenfield opportunity to monopolize high-value data sets that only we can produce.

Achieving success in any one of these three areas would drive transformative growth for Aspermont. We intend to succeed in all three

Slide 12 – Q1 FY25 Progress Report

We are making considerable progress across our growth strategies. First, we have partnered with a new marketing agency to supplement our operational capacity and technical expertise.

Second, we are developing two new Data products for launch near term. The Mining Journal Project Pipeline Index has been a popular research report for some years and its new data product extension is already attracting prelaunch sales at more than fifteen times our current Average Revenue Per Unit.

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Our Mining Journal ESG Index is also set to launch this quarter and has exciting potential for a multiplicity of products and pricing tiers. We are ranking the top 50 mining companies by 36 different E, S and G variables. This will enable us to collect unique and valuable new market data. Lastly, we are evaluating a new mobile phone-based geofencing marketing solution, initially targeting the patrons of large US mining exhibitions. If the pilot succeeds, it has the potential to develop a significant new market.

Slide 13 – Aspermont at an Inflection Point

For the first time in Aspermont’s history Subscriptions contribute over 50% of the total revenue and our subscribers maintain a near 100% net retention rate.

Powerful brands, a top-tier management team, and recognised leadership in B2B media for the mining sector, position our company well for sustained growth.

And Aspermont has proved that growth potential over 33 consecutive quarters.

After spending two years investing in new personnel, and the data and intelligence division, Aspermont is at an inflection point. As a series of new Data products are released our Annual Recurring Growth and Average Revenue Per Unit will step change.

As we told investors at the end of the first half we have returned to profitability, while balancing our inward investment with our cash reserves to upgrade revenue quality.

The next few years should be an exciting time for Aspermont and our shareholders. Thank you for your attention. We will now take any questions.

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