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WISETECH GLOBAL LIMITED AGM Information 2016

Nov 21, 2016

66086_rns_2016-11-21_139f762a-3464-4d66-9f2c-42bfeb117895.pdf

AGM Information

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2016 Annual General Meeting of Shareholders

Important notice and disclaimer Visit www.wisetechglobal.com/investors

FORWARD-LOOKING STATEMENTS

This presentation may include forward-looking statements. Such statements can generally be identified by the use of words such as 'may', 'will', 'expect', 'intend', 'plan', 'estimate', 'anticipate', 'believe', 'continue', 'objectives', 'outlook', 'guidance‘, ‘forecast’ and similar expressions. Indications of plans, strategies, management objectives, sales and financial performance are also forward-looking statements.

Such statements are not guarantees of future performance, and involve known and unknown risks, uncertainties, assumptions, contingencies and other factors, many of which are outside the control of WiseTech Global. No representation is made or will be made that any forward-looking statements will be achieved or will prove to be correct. Actual results, performance, operations or achievements may vary materially from any forward-looking statements. Circumstances may change and the contents of this presentation may become outdated as a result. Readers are cautioned not to place undue reliance on forward-looking statements and WiseTech Global assumes no obligation to update such statements.

No representation or warranty, expressed or implied, is made as to the accuracy, reliability, adequacy or completeness of the information contained in this presentation.

PREPARATION OF INFORMATION

All financial information has been prepared and reviewed in accordance with Australian Accounting Standards. Certain financial data included in this presentation is ‘non-IFRS financial information’. The Company believes that this non-IFRS financial information provides useful insight in measuring the financial performance and condition of WiseTech Global. Readers are cautioned not to place undue reliance on any non-IFRS financial information including ratios included in this presentation.

PRESENTATION OF INFORMATION

  • Pro forma Except where explicitly stated, the financial data in this presentation is provided on a pro-forma basis. Information on the specific pro-forma adjustments is included in the Appendix to this document.

  • Currency All amounts in this presentation are in Australian dollars unless otherwise stated.

  • FY refers to the full year to 30 June.

  • Rounding Amounts in this document have been rounded to the nearest $0.1m. Any differences between this document and the accompanying financial statements are due to rounding.

THIRD PARTY INFORMATION AND MARKET DATA

PAST PERFORMANCE

Past performance information given in this presentation is given for illustrative purposes only and should not be relied upon as (and is not) an indication of future performance.

INFORMATION IS NOT ADVICE

This presentation is not, and is not intended to constitute, financial advice, or an offer or an invitation, solicitation or recommendation to acquire or sell WiseTech Global shares or any other financial products in any jurisdiction and is not a prospectus, product disclosure statement, disclosure document or other offering document under Australian law or any other law. This presentation also does not form the basis of any contract or commitment to sell or apply for securities in WiseTech Global or any of its subsidiaries. It is for information purposes only.

WiseTech Global does not warrant or represent that the information in this presentation is free from errors, omissions or misrepresentations or is suitable for your intended use. The information contained in this presentation has been prepared without taking account of any person’s investment objectives, financial situation or particular needs and nothing contained in this presentation constitutes investment, legal, tax or other advice. The information provided in this presentation may not be suitable for your specific needs and should not be relied up on by you in substitution of you obtaining independent advice. Subject to any terms implied by law and which cannot be excluded, WiseTech Global accepts no responsibility for any loss, damage, cost or expense (whether direct or indirect) incurred by you as a result of any error, omission or misrepresentation in this presentation.

The views expressed in this presentation contain information that has been derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness or reliability of the information. This presentation should not be relied upon as a recommendation or forecast by WiseTech Global. Market share information is based on management estimates except where explicitly identified.

NO LIABILITY OR RESPONSIBILITY

The information in this presentation is provided in summary form and is therefore not necessarily complete.

To the maximum extent permitted by law, WiseTech Global and each of its affiliates, directors, employees, officers, partners, agents and advisers and any other person involved in the preparation of this presentation disclaim all liability and responsibility (including without limitation, any liability arising from fault or negligence) for any direct or indirect loss or damage which may arise or be suffered through use or reliance on anything contained in, or omitted from, this presentation. WiseTech Global accepts no responsibility or obligation to inform you of any matter arising or coming to their notice, after the date of this presentation, which may affect any matter referred to in this presentation. This presentation should be read in conjunction with WiseTech Global’s other periodic and continuous disclosure announcements lodged with ASX.

1

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Charles Gibbon Chairman

WiseTech is a leading provider of software to the logistics industry globally

125+

countries[(1)]

6,000+ customers[(2)]

19 of top 20 global logistics service providers are customers[(3)]

7 of top 25 global freight forwarders in global rollout[(4)] $1.6billion market capitalisation Countries with licensed users WiseTech office Headquarters Global Data centres

  • (1) Countries in which WiseTech software is licensed for use

  • (2) Customers refer to purchasers of our software; includes customers on the CargoWise One application suite and legacy platforms of acquired companies; legacy customers may be counted with reference to installed sites

  • (3) Top Global 3PL (Third Party) Logistics Providers List, ranked by Armstrong & Associates using a combined overall average based on their individual rankings for gross revenue, ocean TEUs and air metric tons, for the 12 months ended 31 Dec 2014. Customers are as at 31 Dec 2015.

  • (4) Armstrong & Associates, “Top 25 Global Freight Forwarders List – ranked by 2015 Logistics Gross Revenue/Turnover”. Customers are as at Sep 2016.

3

WiseTech Global – FY16 financial highlights

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||||||||
|---|---|---|---|---|---|---|
|STRONG|HIGH recurring|LOW|HIGH innovation|LOW|PROFITABLE|
|organic revenue|HIGH quality|customer|product development|sales & marketing|+|
|growth|revenue|attrition|investment|expense|cash generative|
|↑|47%|growth in|98% <1%|37% 15% ↑|44%|EBITDA|
|statutory revenue|Recurring Annual Attrition Rates|[(1)]|of revenue|[(2)]|of revenue|
|FY15 to FY16|Revenue|(by CargoWise One|$31.5m|
|customers)|51% 13%|
|$103m|of our people|of our people|Profitable|
|Revenue|
|open-access,|Dividend paying|
|on-demand licence,|
|swift on-boarding|

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(1) Annual Attrition Rate is a customer attrition measurement relating to the CargoWise One application suite (excluding any customers on acquired legacy platforms). A customer’s users are included in the customer attrition calculation upon leaving, that is, having not used the product for at least four months. Based on the four financial years to FY16 inclusive

(2) Total investment in product development and innovation includes both expensed and capitalised amounts each year spent on product development and Innovation.

4

CargoWise One: an integrated software solution for the logistics industry Allowing companies to better manage many aspects of the global supply chain

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(1)
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2.8 million + development hours over 15 years to build a global platform

34 billion +

data transactions[(2)] annually in FY16

  • (1) Available in CargoWise One but not in ediEnterprise

  • (2) Based on hosted CargoWise One data transaction levels for the 12 months ended 30 June 2016, extrapolated across CargoWise One application suite excluding acquired legacy systems such as Translogix, Corefreight, CompuClearing and Zsoft

5

Our people are changing the world of logistics one innovation at a time

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Richard White Founder CEO

WiseTech Global – FY16 financial highlights

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Revenue ($m)
Statutory
47%
Pro forma
growth in revenue 102.8 103.3
(statutory)
79.6
70.0
66.0
56.7
51.9
43.0
30%
growth in revenue
(pro forma)
FY13 FY14 FY15 FY16
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EBITDA ($m)
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Pro forma EBITDA
44%
Pro forma EBITDA margin 30%
growth in EBITDA 28%
(pro forma) 28% 31.5
21.9
17% 18.6
8.9
FY13 FY14 FY15 FY16
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98%

recurring revenue

42%

growth in pro forma new customer revenue

<1%

Revenue by licence type (%)

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83%
On-demand 44%
of revenue now from 59%
71%
On-Demand licensing 83%
OTL maintenance
45%
37%
26%
OTL & 15%
11%
Support servic es 4% 3% 2%
FY13 FY14 FY15 FY16
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Net profit after tax (NPAT) ($m)

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37% Statutory
Pro forma
growth in NPAT 14.2
to $14.2m
(pro forma) 10.1 9.8 10.1 10.4
NPAT (statutory)
$2.2m
3.7
3.1
reflecting one off 2.2
costs in FY16
FY13 FY14 FY15 FY16
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attrition each year for last 4 years

(CargoWise One customers)

We are investing

$165 million

innovating and further developing our global platform in FY13 to FY17

8

Multiple levers for business growth

Multiple levers to sustain growth and increase market penetration

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+
+
Transactions/users Modules
+
Innovation Increase Stimulate Grow
Industry
and Geographies new network through
consolidation
expansion of customers effects acquisitions
Greater usage by existing
our global on the
customers
platform platform
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9

Innovation investment

Significant pipeline of longer-term innovations across existing verticals and new adjacencies

new modules to enable additional logistics capabilities or market segments e.g. warehousing

upgrading for new regulatory requirements e.g. Automated Customs Environment US

over 670 product upgrades in FY16

adding quality

improvements – automating or eliminating processes

e.g. global standard workflows

new product components to expand functionality of existing modules e.g. geo-coding

hardware components to complement our software e.g. telematics devices, VolCam

extending access to new geographies e.g. China, South Africa

37% of revenue invested in FY16

51%

of staff focus on product/innovation

590,000 unit tests executed hourly

$165m investing FY13-FY17F

incorporating new technology or delivery mechanisms e.g. elastic cloud, ssd only storage

investing in processes, data centres, scalable technology e.g. new region data centres

building next-generation

productivity tools e.g. PAVE, GLOW

Address Cleansing, Validation + Geocoding

Universal Customs Engine

VolCam

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10

Greater usage by customers Significant growth in existing customers

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+
+
Transactions/users Modules
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CW1 module users by cohort

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120,000
100,000
80,000
60,000
40,000
20,000
-
Jun-13 Jun-14 Jun-15 Jun-16
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+
Industry
Geographies
consolidation
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CW1 revenue by cohort
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90
($ million)
80
70
60
50
40
30
20
10
-
FY13 FY14 FY15 FY16
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11

New customers – can onboard swiftly and roll out without restriction Allowing customers access to everything can deliver steady growth from a single sale

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2015: 9,107 module users
47 countries
2014: 8,396 module users
45 countries
2013: 6,645 module users
42 countries
etc…
2012: 3,551 module users
34 countries
etc…
2011: 1,086 module users
11 countries
etc…
Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
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# of module users[(1)]

Note: This represents a specific example for one specific large-scale, multi-national customer using CargoWise One over time. It does not purport to represent the growth profiles for all customers or the growth rate of users and geographies of this specific customer in the future (1) Sourced from WiseTech Global as at December 2015

12

Network effects

Multiple active programmes drive adoption, operating system for global logistics

We build on our strong customer penetration across high GDP trade routes …

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By supporting our sales activity with additional effective network programmes …

WARP + Networks + CCLP + Industry education Wise Agent Referral Programme Freight forwarding networks Certification programme Global - secondary and tertiary

Users by head office for each CargoWise One application suite customer during June 2016.

13

Organic growth accelerated by acquisitions Small, valuable acquisitions further our growth across geographies and adjacencies

We buy into market positions that would take years to build, integrate swiftly, drive value across platform

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Why we acquire What we target

  • Acquire customers in new • New geographies geographies to migrate to CargoWise One global • Strongly entrenched leading platform providers (preferably top 3)

  • • Acquire compliance • In markets with complex capabilities to avoid high compliance requirements

  • risk, costly market entry (particularly customs)

  • Acquire skilled employees • Major markets with larger with local market 3PL customers to allow us to

  • experience, logistics drive network effect

  • industry capability and processes • New, complex, adjacent

  • • Acquire to efficiently competencies to allow us to acquire specialist market

  • enter new geographic knowledge to support our

  • regions with lower cost product development

  • and lower risks than organic growth may deliver

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Global sea-freight
Germany
Softship FY17
Freight
Forwarding
China
Zsoft FY15
Land
Transport
Customs Translogix
South Africa AirCargo FY13
CompuClearing FY16 Msg
Core Freight FY15 CCN FY16
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14

Outlook - industry dynamics Industry pain points drive an exponential shift to CargoWise One

3PL industry dynamics vs Impact of low propensity to switch out of dynamic for proprietary systems WiseTech

Our leading global logistics software and open-access, usage-driven business model remove constraints to growth

Increasing regulation
Increasing complexity
Growth in transactions
High fragmentation
Pressure on supply chain execution margins
Capital constraints
Increasing network tie-ups
Demand for faster throughput
Cycles in 3PL verticals – economic up/downturn
Consolidation across 1PL/2PL/3PL, Amazon
3PL consolidation growing
High labour cost in high GDP trade routes
Impact of political change (new govt/Brexit)
Shift to SaaS, cloud
Shift from in-house to commercial systems
positive
positive
positive
positive
positive
positive
positive
positive
positive
positive
positive
positive
positive
positive
positive
Fast to market with new regulatory changes
Relentless innovation investment, automates or eliminates processes
Highly scalable, integrated platform, productivity focused
Operating system for logistics, one to thousands users
SaaS, pay for use monthly in arrears, productivity benefits
No upfront capital, easily add users and regions, only pay for use
Integrated global platform, 125+ countries, real time visibility
Highly automated, more productive, enter data once
Pay for what you use, linked to value point
Execution capability across supply chain, plug into myriad systems
Seamless, swift, scalable on-board of thousands, global rollouts
Significant productivity gains through technology
Unsurpassed software development capacity to meet change
SaaS since 2008, cloud, all devices, LDaaS and PaaS to come
Commercially proven, integrated global platform used by 19 of top 20
largest global 3PLs

Our technology and business model turns industry problems into tailwinds

15

Outlook for FY17

  • Strong momentum into FY17

  • Revenue growth across existing and new customers

  • Tailwinds from industry dynamics

  • Annual attrition rate <1%

  • Large customers rapidly integrating acquisitions using CargoWise One

  • Brand uplift from global rollouts, large customer wins and ASX listing

  • Business well positioned for significant growth

  • ‘operating system for global logistics’ licensed in 125+ countries

  • Relentless innovation, $165m (FY13 - FY17F), widening technology lead with every $ invested

  • Strong balance sheet, quality recurring revenues, generating further cash flow

  • Accelerating organic growth by integrating acquired vendors + building out platform capability

  • Driving global expansion with further acquisitions in key regions and adjacencies

  • Healthy growth in earnings expected yoy

forecast growth vs pro forma FY16 FY17 Total revenue $148m - $155m 43 - 50% FY17 EBIDTA $50m - $53m 59 - 68%

Changing the world … one innovation at a time

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AGM closed Thank you

Changing the world of logistics one innovation at a time

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