PSI capital market day 2014
December 3rd 09:00 -12:00
Jørgen Waaler, CEO
Agenda
- PSI Group going forward Jørgen Waaler, CEO PSI Group ASA
- The Future of Cash payments Roine Gabrielsson, CEO CashGuard AB
- PSI Group entering the Baltics Evaldas Budvilaitis, CEO NewVision Baltija UAB
- Lunch at noon
PSI Group going forward
- PSI Group Mission and Vision
- Financial recap YTD Q3 2014
- PSI Group Business model & Value proposition
- Verticals expansion; future technological solutions, omni channel concepts
- Horizontal expansion; possible market expansion and opportunities
- Recent client examples
- Q & A's
PSI Group mission
"Driving Retailers' productivity by providing innovative integrated Technology Solutions"
PSI Group vision
"Becoming a recognized global provider of Retail Technology Solutions"
Financial highlights YTD Q3 2014
Three official segments
|
YTD 2014 |
|
YTD 2013 |
|
|
| MNOK |
Revenues |
EBITDA |
Revenues |
EBITDA |
|
| PSI Technology |
332,5 |
26,7 |
258,0 |
18,4 |
|
| PSI Retail |
140,7 |
8,4 |
209,2 |
27,0 |
|
| PSI Label |
124,4 |
8,6: |
65,0 |
0,9 |
|
| Group |
0,4 |
$-9,5$ |
0,4 |
$-7,9$ |
|
| Eliminations |
$-21,6$ |
0,0; |
$-2,3$ |
0,3 |
|
| Total |
576,4 |
34,2 |
530,3 |
38,6) |
|
Financial highlights YTD Q3 2014
Per geographical market
|
|
YTD 2014 |
Other |
|
YTD 2013 |
Other |
| MNOK |
Norway |
Sweden |
markets |
Norway |
Sweden |
markets |
| PSI Technology |
93,7 |
154,5 |
84,3 |
94,4 |
86,3 |
77,3 |
| PSI Retail |
46,7 |
72,5 |
21,5 |
124,5 |
84,4 |
0,4 |
| PSI Label |
44,4 |
77,9 |
2,0 |
27,2 |
37,8 |
0,0 |
| Group |
0,4 |
0,0 |
0,0. |
0,4 |
0,0 |
0,0 |
| Eliminations |
$-1,0$ |
$-20,3$ |
$-0,4$ |
$-0,7$ |
$-0,6$ |
$-0,9$ |
| Total |
184,3 |
284,6 |
107,4 |
245,6 |
208,0 |
76,8 |
PSI Group – Revenues last 12 quarters
Revenue categories YTD Q3 2014
|
|
MNOK 576,4 |
|
|
| MNOK |
|
|
|
|
| 220 |
|
|
|
|
| 200 |
|
|
|
|
| 180 |
|
|
|
|
| 160 |
|
|
|
|
| 140 |
|
|
|
|
| 120 |
|
|
|
|
| 100 |
|
|
|
|
| 80 |
PSI LABELS |
SERVICE & SUPPORT |
PSI RETAIL |
PSI TECHNLOGIES |
| 60 |
|
|
|
|
| 40 |
|
|
|
|
| 20 |
|
|
|
|
| 0 |
|
|
|
|
|
RECURRING REVENUES |
|
CAPEX PROJECTS |
|
|
MNOK 281,1 |
|
MNOK 315,5 |
|
CONSUMER BEHAVIOR AND TRENDS
Verticals; future technological solutions
Horizontals; Reaching our vision New and possible geographical footprints
- Home markets
- PSI office/representation markets
- Channel markets
Why New Vision acquisition?
- Large step towards our internationalization strategy
- Baltic market leader within Retail Solutions
- Advanced software solutions and software development competence and business consultancy
- New geographical footprint for New Vision applications in Norway and Sweden & for CashGuard & Vensafe in Baltics
- Highly valued by customers within Retail technology, Retail equipment field service, Self checkout competence and a skilled consulting organization
PSI Group customer ambitions
- Thought leader within Retail Technology trends
- Trusted consultants & advisors within Retail Solutions
- ONE stop shopping
- Comprehensive provider of Retail Solutions in all areas where consumers interact with the stores
One stop Shopping Coop Åsane – new store opening November
Omni channel
Lefdal Sandvika – new store opening TODAY
Questions?
PSI capital market day - summary
- Comprehensive provider of Retail Solutions in all areas where consumers interact with the stores
- Stronger international focus and resource allocations
- Cash payments solutions will remain a significant part of our business
- Expanding our retail software offerings through New Vision
- Strengthened executive management
The future of cash payments
About CashGuard
- Founded in 1991
- Head office in Stockholm, Sweden
- Sales offices in France, Germany, Malaysia and Singapore
- 20 global business partners
- Market share in Europe over 70%
- Close to 25 000 sold systems
A company in change
"We create a world class point of sale experience by making cash payments competitive"
Cash trends
- The US dollar increased with 42% from 2007 to 2012
- The U.K. Pound increased with 29% from 2008 to 2013
- The Euro increased with 34% from 2008 to 2013*
- The Malaysian Ringgit reached 70 billion in 2012
- Cash accounts for 70-80% of transactions**
- Total cash-spending is increasing***
Cash trends
- Card payments continue to increase
- Mobile payments are gaining ground
- Sweden closer to a cashless society
- Banks are encouraging this move
- The cost of handling cash is too high
- Cash-spending share is declining*
People like cash…
- Cash is the most viable payment method
- Cash protects against electronic theft/fraud
- Cash leaves no electronic traces
- People trust cash in difficult economic times
- There is a strong cultural connection to cash
- 2,5 billion adults in the world are unbanked*
"Society is not ready to abandon cash" ECB, 2013
But retailers don't
Retail cash handling
- The cash payment process has stayed stagnant for decades
- 90% of retailers lack a secure and efficient cash management process*
- Most retailers still handle their cash manually
- Shrinkage and counting errors directly effect profits
- Robberies are expensive and adds stress to the staff
- Cash is still the cheapest payment method**
MANUAL CASH HANDLING
- Exposes everyone to cash
- Costs time and money
- Diverts resources from the core business
- Leads to a suspicious work environment
- Negatively affects the customer experience
Focus on core business
Retail cash management
- Automating payments at checkout
- Enabling in-store recycling of cash
- Streamlining float levels, replenishment and collection
- Eliminating reconciliation, shrinkage and counting
- Optimizing cash collection from CIT
- Reviewing all processes and resources
Benefits of cash management
Cash management specialists
ROLL OUT • DEPLOY CASHGUARD SOLUTIONS • DELIVER SUPPORT SERVICES • REVIEW AND STREAMLINE PROCESS REPORT
Solution approach
Cash handling analysis
-
- 2 day study
-
- Interviews/data collection
-
- In-store analysis
-
- Solution proposal
-
- Cash impact report
*Economic Outlook for Southeast Asia, China and India 2014, OECD
CashGuard in South East Asia
- 620 million people
- Annual GDP growth rate is 5,4 %*
- The world's largest retail market
- Growing middle class
- Cash is still king according to retailers
- Productivity and efficiency is key
CashGuard in South East Asia
- Regional office in Kuala Lumpur, Malaysia
- Direct sales approach
- Local service provider
- Addressing large chains and SME
- 15 analyses done, 2 pilots ongoing
- 4 pilots confirmed for Q1, 2015
- Strong pipeline for 2015-2016
- First deal in December 2014
CASHGUARD SDN.BHD
Suite 16-08, Level 16, G Tower, 199 Jalan Tun Razak, Kuala Lumpur, Malaysia
CASHGUARD PTE.LTD
111 Sommerset Rd #07-04, TripleOne Sommerset, Singapore
CashGuard – future
- Cash payments continue to be key focus
- New markets are and will be explored
- New payment methods are monitored and evaluated
- New product line launched 2015 focus on software
- Checkout experience
- Increased collaboration with New Vision
www.cashguard.com
NEW VISION BALTIJA
Background and organisationProducts / solutionsLong term outlook
Evaldas Budvilaitis, NVB co-founder & CEO PSI Group Capital Market Day, December 3rd, 2014
Evaldas Budvilaitis
- 46 years young Lithuanian
- Electronic Engineer from Kaunas University of Technology (1993) and MBA from ISM Management University / BI (2002)
- 21 years together with Retail systems and Retailers
- Experienced - start up, going outside Lithuania, Joint Ventures, M&A, MBO, repositioning company, regional multicultural
- "Love" retail technologies and solutions
- Business friends WW within business segment
- Good knowledge about WW market Retail solution offering, new technologies and competition
NVB Vision 2010 - 2017
- We strive to be the most valued business technology partner for retailers in Baltic countries.
- Constantly look for opportunities to expand to other markets with the help of gained specialized skills and
- to encourage employees and retail or IT community members to develop innovative products that can grow into new businesses.
It started in New York
- 2010 we were standing in front of NYSE building and thinking, why don't we start thinking big and try playing in another league
- The difference between "dream" and "vision" is ones role
- In 2014 July NEW VISION became part of PSI Group ASA
Why PSI and NVB is good fit
Customers
- Our big corporate customers appreciates, that we are part of Scandinavian Public Company
- NVB opens the customers for PSI Technologies products
- Colleagues
- Our skilfull staff are available and can be shared among the group
- Solutions synergies and growth opportunity
- PSI opens customers in Norway and Sweden for NVB solutions
- Together we can go better to new markets
Our company
A leading partner for retailers in Baltic countriesWholly owned subsidiary of PSI GROUP ASA, as of July 3, 2014
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- •On-site service
- Workshops repair
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BI solution
mobile applications
- • Barcode scanners &mobile computers
- •Security systems
- Scanning solution
- • Irisys que prediction & staff management solution
- •Capacity model
Our business model
Significant part is stable and reccuring business
We insure retailers systems operate and bring value
- •HW/SW installations
- •HW/SW Master systems
- • New stores openings, remodeling
- •Roll-out management
- •New ideas & products
- •New Features or Requests
- •Patches and bug fixes
-
•SW compliance with laws
-
•Single Point of Contact
- •Problem dispatch to appropriate solver
- • Fast solutions to known problems by providing online consultation or remote support;
- • Escalation for more complex problems to 3rdlevel
- •SLA level ensurance
- •On-site Support for HW Issues
- •Own HW and 3rd party HW service
- •HW warranty and post warranty repair
- •Periodical preventive maintenance
Our total solutionapproach
Our customer references
What do our customers say
In-depth retail competence and understanding of retail operations
"We've chosen a company capable to ensure high quality services of our IT systems through the Baltics and has deep competence in retail management"
Mr. Valerijus BudiakCIO at "Apranga" group
Solution orientation and"one stop shop" for retail IT/POS systems
"New Vision are experts of integrated retail systems with the ability to measure the impact of the fault on business processes, prioritize fault repair properly or simply give advice on the phone. This is a great advantage compared to providers of general help desk or call center services".
Mr. Andrius ŠemeškevičiusIT Director RIMI BALTIC
Added value and competence within both topline and efficiency tools
"NCR, as the global market leader in self-checkout technology, excelled against its competition. NCR and its local partner New Vision really focused on our business need and challenges".
Mr. Marcel HarasztiChief Executive Officer
PALINK
Key customer segments
- Local food retailers Baltic
- Local speciality retailers Baltic
- International retail and hospitality chains in Baltics
- Local Hospitality chains Baltic
- Activities outside Baltics
FOOD RETAILER
- Chain currently operates 233 stores
- 51 – Hypermarkets, 73 - Supermarkets, 109 – Discounters
- Scale in 2013
- Revenue – SEK 10'333 million, Employees – 8'248
- Business priorities 2014 from ICA Gruppen anual report
- develop and strengthen the Rimi brand
- open new Rimi stores, primarily in Lithuania
- develop private label products
- continued development of the customer loyalty program
- efficiency improvement in sourcing and logistics
NV and RIMI BALTIC PARTNERSHIP
- New Vision is our strategic partner in Store Systems area, said Andrius Šemeškevičius Rimi Baltic CIO speaking at NV Staff conference in 2013
- Areas of our current collaboration:
- Department scales (Digi HW, field services)
- Price checkers (SW, support)
- HelpDesk (platform, call center, remote support)
- Loyalty system (SW development, support)
- POS and BackOffice systems (SW licensing, development, support)
- POS and related equipment (HW, field services)
- Customer terminal/kiosk (HW, field services)
SPECIALITY RETAILER
Apranga Group is a leading fashion retailer in the Baltic States which has partnerships with the most famous European and global brands. Apranga Group is consisted of main company Apranga APB and 17 subsidiary companies. Main company Apranga APB is listed on Nasdaq Vilnius Stock Exchange since 1997.
Apranga in figures:
Revenue 2013 – NOK 1'495 millionStores – 160 across Lithuania, Latvia & EstoniaEmployees – 1'858
Brands representedin the Baltics
NV PARTNERSHIP WITH APRANGA
- Partnership with all NV product range
- LS RETAIL retail management system
- Microsoft Dynamics NAV ERP
- All instore IT HW equipment
- Service contract for all Baltic countries
- Proactive role in solution design
- Mobile computers and SW for multiply needs
- Gift cards solutions
- IP video systems, like people counting currently and consumer behaviour comming next
INTERNATIONAL
- 1 store in Baltics, operated by European franchise partner
- NV and IKEA Lithuania partnership:
- • Localized and implemented LS Retail and Microsoft NAV under supervision of K3 Solutions from Netherlands
- • Instaled POS HW and Credit card payment systems
- •Store IT service and support
- •Discussion about new solutions for 2015
RESTAURANT CHAIN
- The largest public catering chain in the Baltic States, with 59 own restaurants in Lithuania and Latvia. Additionally, 23 restaurants operate under franchise agreements, 14 in Lithuania and 9 in Latvia. Every year at least 5 newČili restaurants opens.
- At present, Čili Holdings operates "Čili Pica", "Čili Kaimas", "SOYA", "Forest" and a food manufacturing unit "Maisto Namai"; also manages a chain of Japanese restaurants "Tokyo" and provides food delivery services.
- NEW VISION solutions consist of:
- • LS Hospitality and MS Dynamics NAV for full enterprice business management
- • POS HW and all restaurant IT equipment implementation and services
- • Web ordering and home deliverymangement IT solutions
- •LOYALTY system
RETAILER IN RUSSIA
- LEADING RETAILER in RUSSIA. X5 Retail Group N.V.'s global depository receipts have been traded on the London Stock Exchange since Pyaterochka's IPO in May 2005 under the ticker "FIVE LI".
- Stores as of September 30th, 2014: neighborhood – 4342, supermarkets -389, hypermarkets – 81
- One of TOP Strategic initiatives:
- Improve service (que management) and shelf availability
- • NEW VISION opened 8 stores across Russia with 3rd party Self Checkout equipment during last 12 months and gained the reputation of trusted supplier-partner.
- •Now we in discussion about new (own) products among them:
- •Self Scanning on mobile
- •Cash management with CashGuard
X5 Retail has more than 20'000 POS systems installed
X5 RETAIL GROUP Russia
Our achievements
Well balanced customer portfolio in home markets with >50% recurring revenue
Service Focus
ISO CERTIFICATION – ONE MORE STEP
Forward looking trends
Times are changing
- Understanding and satisfying theconsumer is more complex thanbefore
- • Consumers needs personalizedapproach, means moresophisticated systems for retailers
- • Traditional HW and POS SW providers can't meet needs of retailers
- • Traditional ERP companies don't have required retail know how
Multichannelbecomes omnichannel
- Implication Trends/drivers New opportunities with mobile devices for retailer staff New generation of ERP and Retail solutions, with integration to various external solutions, will require providers with integration experience Large variances within ERP SW
- whether they are adapted to newchannel strategies
Self Service – new way to be Retailer and improve consumerservice
- • Suppliers must be Experienced independant solution providers with knowledge in Self Checkout, Self scanning on mobile and traditional one are well positioned for growth
- • Providers with business consultancy tools and know how on how to organize check out for general retail will be sought after
How future consumers will SHOP, PAY and WANT TO BE REWARDED?
PSI Group strategic outlook
How PSI Group will benefit from NV
- Total solution and system integration know how and potential synergy
- Potential to create new solution for CHECKOUT EXPERIENCE together with CashGuard and Vensafe
- Proprietary software products and R&D capacity
- Market leadership in Baltics with channel for own technology sales and 3rd party distribution attractivenes
- Knowledge and contacts with key retailers in Russia
Thank you!
Takk!
QUESTIONS?