THE NEXT PHASE OF GROWTH - Basware/media/Files/B/Basware-IR-V2/docu… · THE NEXT PHASE OF GROWTH...
Transcript of THE NEXT PHASE OF GROWTH - Basware/media/Files/B/Basware-IR-V2/docu… · THE NEXT PHASE OF GROWTH...
IMPORTANT NOTICE
The following information contains, or may be deemed to contain, forward-looking statements. These
statements relate to future events or future financial performance, including, but not limited to,
expectations regarding market growth and development as well growth and profitability of Basware. In
some cases, such forward-looking statements can be identified by terminology such as “expect,” “plan,”
“anticipate,” “intend,” “believe,” “estimate,” “predict,” “potential,” or “continue,” or the negative of those
terms or other comparable terminology. By their nature, forward-looking statements involve risks and
uncertainties because they relate to events and depend on circumstances that may or may not occur in
the future. Future results may vary from the results expressed in, or implied by, the forward-looking
statements, possibly to a material degree. All forward-looking statements included herein are based on
information presently available to Basware and, accordingly, Basware assumes no obligation to update
any forward-looking statements, unless obligated to do so pursuant to an applicable law or regulation.
Nothing in this presentation constitutes investment advice and this presentation shall not constitute an
offer to sell or the solicitation of an offer to buy any securities of Basware or otherwise to engage in any
investment activity.
2
BASWARE TEAM WITH YOU TODAY
3
Esa Tihilä
CEO
Niclas Rosenlew
CFO
Vesa Tykkyläinen
SVP Network
Ad van der Poel
SVP Financing Services
Ilari Nurmi
SVP Purchase to Pay
Tuomas Marttila
Head of Strategy
BASWARE OVERVIEW
Invoice automation, procurement
& travel and expense
management software
within organizations
e-invoicing solutions &
operator between
buyers & suppliers
New value added innovations:
Basware Pay, Basware Discount
& Basware Advance
• 2500+ large customers
• 1.2 million users
• SaaS / License
• Basware Commerce Network
connects 1 million companies
in over 100 countries
• Basware Commerce Network
enabled
• Partnerships include e.g.
MasterCard, Arrowgrass, ING
NETWORK PURCHASE TO PAY FINANCING SERVICES
Founded 1985; Publicly listed 2000 (NASDAQ OMX Helsinki); Net sales of €143.4 million (2015)
Basware is the leading provider of networked purchase-to-pay solutions,
spanning e-invoicing to innovative financing services in the world of commerce
4
GLOBAL LEADERSHIP WITH A UNIQUELY COMPLETE OFFERING
E-invoicing
Working capital optimization
Purchase-to-Pay (P2P)Accounts Payable (AP)
Ranked constantly as a leader
by leading independent
research companies
Top 3
in Procurement
# 1 B2B Commerce Network
# 1 in Accounts
Payable
5
Basware
Financing
Services
Largest
e-invoicing
network
Enabling priorities and investmentEsa Tihilä, CEO
Summary and conclusionsEsa Tihilä, CEO
Extend cloud Purchase to Pay leadershipIlari Nurmi, SVP Purchase to Pay
TODAY’S FOCUS IS ON THE NEXT PHASE OF GROWTH
6
Starting point for the next phase of growthEsa Tihilä, CEO
Accelerate Network growthVesa Tykkyläinen, SVP Network
2016-2018 Financial implications and goalsNiclas Rosenlew, CFO
13:00-
14:45
15:15-
17:00
Break
Cocktails
Unleash Financing ServicesAd van der Poel, SVP Financing Services
Enabling priorities and investmentEsa Tihilä, CEO
Summary and conclusionsEsa Tihilä, CEO
Extend cloud Purchase to Pay leadershipIlari Nurmi, SVP Purchase to Pay
TODAY’S FOCUS IS ON THE NEXT PHASE OF GROWTH
7
Starting point for the next phase of growthEsa Tihilä, CEO
Accelerate Network growthVesa Tykkyläinen, SVP Network
2016-2018 Financial implications and goalsNiclas Rosenlew, CFO
13:00-
14:45
15:15-
17:00
Break
Cocktails
Unleash Financing ServicesAd van der Poel, SVP Financing Services
WE HAVE CREATED A SOLID FOUNDATION FOR GROWTH
8
Growing market driven by digitalization, drive for efficiency and regulation
Recognized product leadership
Established and loyal customer base with high share of recurring revenue
Over 1,000,000 organizations connected via Basware Commerce Network
Large and valuable amounts of data accumulated in the
Basware Commerce Network
Streamlined, customer-centric organization with global reach, and strong
presence in all key growth markets
2010 2015
SaaS and Network
Maintenance, consulting and license
A GROWING CLOUD BUSINESS SUPPORTED BY A STABLE BASE
Cloud businesses
growing fast
Maintenance, consulting
and license businesses
provide a solid base
12%
88%
40%
60%
Constant growth year-on-year
Positive cash flow
Strong balance sheet
Cloud transition has temporarily
depressed group growth & margins,
this is unwinding as transition
completes
Note: SaaS and Network: P2P SaaS, transactions, Procserve and transaction network related partnership income.9
STRONG NET SALES GROWTH IN HIGH POTENTIAL MARKETS
Net sales by markets (Q1-Q4 2015) Growth in Net sales (2015 vs. 2014)
Total Net sales:
€143.4 million(1)
Net sales stable in mature markets Strong organic growth in key markets
(1) Includes Procserve and partnership income.
(2) Excludes Procserve and partnership income.
(1)
(1) (2)
10
WE SERVE A SIGNIFICANT NUMBER OF GLOBAL CUSTOMERS2,500+ enterprise and corporate customers across all industry verticals and public sector
Banking / Finance
Transportation / Logistics
Retail
Manufacturing Food / Beverage
Professional Services
Medical / Pharma / Biotech Chemicals
Energy
Public Sector
Construction
Services
+ more than 1,000,000 organizations connected to Basware Commerce Network
11
MARKET AND COMPETITIVE SITUATION ALLOWS ACCELERATING GROWTH
12
Extend cloud Purchase
to Pay leadership
Accelerate Network
growth
Unleash Financing
Services
Penetration still low but
accelerating
Network is the
foundation for value
added services
Fragmented standards,
Basware the largest
network, supporting all
Growth picking up in
key large markets
Demand moving rapidly
to cloud solutions
Basware is a
recognized market
leader
Alternative financing
services attracting
growing investment
Basware an early
leader, leveraging
network data
First solutions launched
NETWORK PURCHASE TO PAY FINANCING SERVICES
KEY 2016-2018 PRIORITIES FOR TAKING THE NEXT STEP
13
Extend cloud
Purchase to Pay
leadership
Accelerate
Network growth
Unleash
Financing
Services
1. Accelerating all three businesses:
2. Supported and enabled by:
Further
shortening of
delivery times
Investing in
demand
generation
and sales
Scalable
company
infrastructure
Enabling priorities and investmentEsa Tihilä, CEO
Summary and conclusionsEsa Tihilä, CEO
Extend cloud Purchase to Pay leadershipIlari Nurmi, SVP Purchase to Pay
TODAY’S FOCUS IS ON THE NEXT PHASE OF GROWTH
14
Starting point for the next phase of growthEsa Tihilä, CEO
Accelerate Network growthVesa Tykkyläinen, SVP Network
2016-2018 Financial implications and goalsNiclas Rosenlew, CFO
13:00-
14:45
15:15-
17:00
Break
Cocktails
Unleash Financing ServicesAd van der Poel, SVP Financing Services
BASWARE COMMERCE NETWORK IS AT THE HEART OF MAJOR TRENDS
15
1. Digitalization accelerating and affects all sizes of
organizations
2. Regulation in the EU and the U.S.
pushing e-invoicing penetration
3. True alternative finance platforms in short supply
BASWARE COMMERCE NETWORK: ACCESS ALL THROUGH SINGLE CONNECTION
BASWARE
COMMERCE
NETWORK
Point to point connections True network
Service provider 1
Service provider 2
Service provider 3
16
THE LARGEST OPEN NETWORK
17
The world’s largest open commerce network - connecting buyers and suppliers,
improving relationships and ultimately enabling the flow of commerce
>1 MILLION ACTIVE
BUYERS & SUPPLIERS
A NETWORK OF
USERS IN >100 COUNTRIES
CONSOLIDATED
E-INVOICING & E-ORDERING
SUPPORTS 60+
INVOICE FORMATS
VAT COMPLIANT WITH
DIGITAL SIGNATURES
200+ E-INVOICING
PROVIDERS CONNECTED
BASWARE
COMMERCE
NETWORK
NETWORK VOLUME & REVENUESOLID TRACK RECORDTransaction volume
Tra
nsactio
n v
olu
me (
in m
illio
ns)
(1) Includes start-up fees
Transaction revenue(1)
Tra
nsactio
n r
evenue (€
in m
illio
ns)
Q4/2015
Annualized
transactions18
NETWORK2016-2018 PRIORITIES AND GOALS
19
Accelerate transaction saleso Growth in Basware P2P customers
o Transactions-only opportunities (including targeted
sending sales)
o New partnerships (e.g. cloud ERP vendors, other networks)
Accelerate go-lives and ramp-upso Delivery tools and processes
o Easier and faster connectivity (e.g. business directory,
vendor manager)
Focused platform developmento Leading portal functionality co-developed with customers
o Interfaces (e.g. API connectivity, PDF)
o Network data-based value added services
Key 2018 goal:
250 million
transactions processed
Enabling priorities and investmentEsa Tihilä, CEO
Summary and conclusionsEsa Tihilä, CEO
Extend cloud Purchase to Pay leadershipIlari Nurmi, SVP Purchase to Pay
TODAY’S FOCUS IS ON THE NEXT PHASE OF GROWTH
20
Starting point for the next phase of growthEsa Tihilä, CEO
Accelerate Network growthVesa Tykkyläinen, SVP Network
2016-2018 Financial implications and goalsNiclas Rosenlew, CFO
13:00-
14:45
15:15-
17:00
Break
Cocktails
Unleash Financing ServicesAd van der Poel, SVP Financing Services
INTRODUCTION TO BASWARE PURCHASE TO PAY
21
Modern cloud-based
architecture
Powered by Basware
Commerce Network
Accounts payable automation
Procurement
Travel and expense management
Analytics
Leadership
recognized by
leading
independent
research
companies
Best-in-class Networked Purchase to pay
WORLD-LEADING INTEGRATED PURCHASE-TO-PAY SUITE
22
PROCUREMENT
• Easy & compliant
shopping experience
• Supplier
collaboration in the
network
• Contract lifecycle
management
TRAVEL & EXPENSEMANAGEMENT
ACCOUNTS PAYABLEAUTOMATION
ANALYTICS
• Corporate-wide
financial visibility
• Insights into P2P
process and spend
• Self-reliant financial
decision-making
• Paperless AP from
day 1
• Automated matching
• Intelligent invoice
processing
• Exception handling
• Capturing receipts as
the expenses occur
• Travel costs savings
with early bookings
• Expense claims when
mostly convenient
WE BUILD ON YEARS OF EXPERIENCE AND A SOLID CUSTOMER BASE
23
The leader in P2P with 20 years of expertise
2,500+ P2P customers globally
Significant R&D investment
Business and process consulting services
Select recent customer wins:
BASWARE P2P PAYS BACK IN NO TIME
“We systematically go after
achieving early-pay discounts.
In the past, we captured about
50% of all early-pay discounts
that were available to us; with
Basware, we were able to
push it to 95%.”
Manager, finance at a large
manufacturing company
“We can now finally see — on a
nationwide level — which actual
suppliers we use and how much we use
them. We can use these insights to
better negotiate with existing suppliers
and even contract with suppliers in
areas where we previously didn’t have
any arrangements.”
Development manager at a large
property management company
A COMMISSIONED STUDY CONDUCTED BY
FORRESTER CONSULTING ON BEHALF OF
BASWARE:
24
CLOUD DRIVES P2P REVENUE GROWTH; DEAL MIX SUGGESTS ACCELERATION
25
SaaS revenue ~20% of total…
0
10
20
30
40
50
60
70
2015
Maintenance License SaaS
>80%
total
recurring
revenue
…with recent deal mix suggesting rapid growth
P2P
rev
en
ue (
€M
)
0 %
10 %
20 %
30 %
40 %
50 %
60 %
70 %
80 %
90 %
100 %
Q4/2013 Q4/2014 Q4/2015
License SaaS
Dir
ect
P2P
deals
(#)
~100% YoY
growth in # of
SaaS deals
Q4/’14-Q4/’15
PURCHASE TO PAY2016-2018 PRIORITIES AND GOALS
26
Accelerate saleso Strengthen go to market in key markets
o Develop partner channel (especially BPOs)
Cloud transformationo Continue driving new sales to SaaS
o Transform existing on-premise customers to cloud
Faster go-lives and roll-outso Improve delivery tools and processes
Continued innovationo Continue leading edge innovations (e.g. Analytics, Mobility)
o Leverage Network and Financing services
Key 2018 goal:
>30% SaaS revenue
CAGR (2015-2018)
Enabling priorities and investmentEsa Tihilä, CEO
Summary and conclusionsEsa Tihilä, CEO
Extend cloud Purchase to Pay leadershipIlari Nurmi, SVP Purchase to Pay
TODAY’S FOCUS IS ON THE NEXT PHASE OF GROWTH
27
Starting point for the next phase of growthEsa Tihilä, CEO
Accelerate Network growthVesa Tykkyläinen, SVP Network
2016-2018 Financial implications and goalsNiclas Rosenlew, CFO
13:00-
14:45
15:15-
17:00
Break
Cocktails
Unleash Financing ServicesAd van der Poel, SVP Financing Services
WHY BASWARE FINANCING SERVICES
28
Traditional focus leaves money on the table
Missed opportunity by focusing on efficiency only
Total potential value
Efficiency
Working capital
Time and Focus of AP Programs
Both parties want to manage risk
Both parties use tools to
optimize working capital
Suppliers want
to reduce payment
time
Buyers want
to extend payment
time
The AP/AR dilemma:
Reason is a fundamental dilemma
FINANCING SERVICES OVERVIEW
29
Financing Services completes networked P2P… …for unlocking more value in the supply chain…
…by taking control of the financial supply chain… …leveraging four core components
“69% of companies surveyed admitted to using late
payments as a strategic lever to hold on to cash
reserves”
”-2%/10, net 30” early payment terms
equals 36% Return on Capital for the buyer
80% of suppliers would offer a
discount to be paid early
Timing
Payment Funding
Discount
Networked P2P:
Efficiency gains, transparency and control
Platform to host transactions and related data
Financing services:
Working capital gains
Dynamic cash position management
BASWARE FINANCING SERVICES PRODUCT VISION
30
Basware Commerce Network
Timing
Payment Funding
B2B ePayments
Dynamic
DiscountingMultibank
Payment Gateway
including FX
Discount
Supply Chain
Finance
DPO - DSO
Optimization
Advance Payment
Alternative funding
sources
FIRST PARTS OF OUR SUITE OF SERVICES LAUNCHED AND AVAILABLE FOR 2016
31
SUPPLIER DRIVEN BUYER DRIVEN
Basware Discount
Basware Pay
Basware Advance BASWARE
COMMERCE
NETWORK
A working capital platform offering
clients payable and receivable financing
Built on top of Basware Commerce
Network, utilizing data flow between
companies
In partnership with financial institutions
Current market entry offerings:
Basware Pay: in partnership with MasterCard
Basware Discount: a dynamic discounting solution
Basware Advance: in partnership with ArrowGrass
FIT FOR PURPOSE GO TO MARKET PLAN BEING IMPLEMENTED
32
Phased geographic expansion
Phase I: Launch (completed)
Pay & Discount
Existing direct customers in North America and
Western Europe
Phase II: Growth (2016-2017)
Pay, Discount, Finance & Advance
Geographic scope expanded, new customers
targeted
Phase III: Maturity (2018-)
Further geographic expansion
Offering extended with new innovations
Consultative selling approach
Starting point: Understanding the client’s
approach to working capital and identifying the
right improvement levers
Value creation potential uncovered through
spend analysis performed by Basware
FINANCING SERVICES2016-2018 PRIORITIES AND GOALS
33
Invest into accelerating working capital platform
developmento Maturing existing products and introducing Finance, Payment
Gateway and FX
Expand dedicated Financing Services sales channelso Direct dedicated sales force
o Leveraging partnerships for referrals and revenue
o Marketing and positioning in the treasury and cash
management space
Grow delivery and support in line with sales growth
Continue forming partnerships
Key 2018 goal:
>10% of Basware net
sales (with significant
upside potential not
included in estimates)
Enabling priorities and investmentEsa Tihilä, CEO
Summary and conclusionsEsa Tihilä, CEO
Extend cloud Purchase to Pay leadershipIlari Nurmi, SVP Purchase to Pay
TODAY’S FOCUS IS ON THE NEXT PHASE OF GROWTH
34
Starting point for the next phase of growthEsa Tihilä, CEO
Accelerate Network growthVesa Tykkyläinen, SVP Network
2016-2018 Financial implications and goalsNiclas Rosenlew, CFO
13:00-
14:45
15:15-
17:00
Break
Cocktails
Unleash Financing ServicesAd van der Poel, SVP Financing Services
KEY COMPANY WIDE GROWTH ENABLERS
35
• Invest in sales and marketing to scale lead generation and sales up in
line with market growth opportunity present in all markets
• Double sales force by 2018 – focusing on key large markets: the US,
UK and Germany
• Continue to optimize production to improve scalability of production
platforms and drive down cost of sales
• Increase use of digital tools and services to selectively automate
demand generation and sales activities
• Accelerate go-live and ramp-up times across all services to enable
faster recurring revenue ramp-up from new deals
• Standardize and rationalize delivery work to enable shorter projects at
lower cost, leveraging off/near-shore and self service
Invest in demand
generation
and sales
Scalable
company
infrastructure
Shorten delivery
times
Extend cloud
Purchase to Pay
leadership
Accelerate Network
growth
Unleash Financing
Services
SIGNIFICANT DEMAND GENERATION AND SALES SCALE-UP DURING 2016-2018
36
Example: Sales headcount increase
2015 2018
Go to market investment highlights
Focus on reaching critical mass in
the US, UK and Germany
Grow our partner sales through
business process outsourcing
players and other cloud
ERP/accounting service providers
Increase dedicated small and
medium sized business sales
DELIVERY TIME A KEY LEVER TO ACCELERATE CLOUD REVENUE GROWTH
37
Sales force
increase
Order intake
ramp-up
Sa
les F
TE
/re
ve
nu
e
Incremental
recurring
revenue
Sales reps’
ramp-up Delivery lead time
Sales force increase conversion to incremental recurring revenue
Time
ILLUSTRATIVE
Delivery lead time partly mitigated with starting partial billing at contract signing
SAAS DELIVERY TIMES REDUCING, DRIVEN BY VARIOUS FOCUSED EFFORTS
2014 2015
Median P2P SaaS delivery time (indexed)
Note: Median delivery time from project launch to go-live in calendar days, indexed to 2014=10038
Rapid Deployment Methodology purpose
built for all sizes of customers
Central Delivery Units (off/near-shore) to
ensure cost efficient and scalable capacity
increase to speed up delivery time
Further development of features and
functions that shorten delivery time
Continuous improvement of migration
tools to accelerate on-premise to cloud
transformation
Network innovations to limit
implementation project needs
WE HAVE ALIGNED OUR STRUCTURE, INCENTIVES AND VALUES TO THE STRATEGY
39
• Structure aligned to customer
needs
Customer facing activities global,
segment drive
Business Areas with direct
ownership of product roadmap
• Incentive model geared to drive
growth
Whole organization incentiviced
to grow sales, deliver faster,
delight the customer and ensure
quality
• Basware Values refined and
implemented
Enabling priorities and investmentEsa Tihilä, CEO
Summary and conclusionsEsa Tihilä, CEO
Extend cloud Purchase to Pay leadershipIlari Nurmi, SVP Purchase to Pay
TODAY’S FOCUS IS ON THE NEXT PHASE OF GROWTH
40
Starting point for the next phase of growthEsa Tihilä, CEO
Accelerate Network growthVesa Tykkyläinen, SVP Network
2016-2018 Financial implications and goalsNiclas Rosenlew, CFO
13:00-
14:45
15:15-
17:00
Break
Cocktails
Unleash Financing ServicesAd van der Poel, SVP Financing Services
0%
10%
20%
30%
40%
50%
60%
70%
80%
0
20
40
60
80
100
120
140
160
2010 2011 2012 2013 2014 2015
Maintenance, license and consulting revenue Cloud revenue
Cloud % of total net sales % Recurring revenue
SMOOTH TRACK RECORD OF TRANSITIONING TO CLOUD
Net sales by type (€M)
Alusta P2P
SaaSBasware
Commerce
Network
Basware
Financing
Services
Note: Cloud revenue includes SaaS, transaction, Procserve and other Network related revenue41
0
20
40
60
80
100
120
140
160
2010 2011 2012 2013 2014 2015
TRANSACTIONS, SAAS KEY CONTRIBUTORS TO GROWING CLOUD REVENUE
Cloud
businesses drive
growth
Net Sales by type (€M, 2010 – 2015)
Maintenance,
license and
consulting
provide a solid
base
Other Network
related
Transactions
SaaS
Consulting
Licenses
Maintenance
Note: Other Network related includes Procserve and partnership income.42
BOOKINGS DRIVE FUTURE TOP LINE; MINIMAL CHURN PROVIDING PREDICTABILITY
Recurring revenue bookings(1) soaring Revenue churn(2) at a good level
(1) Recurring revenue bookings based on first years sales quota value
of new deals
(2) Revenue churn reflects rolling 4 quarter revenue of contracts
terminated within the period, as share of total equivalent period revenue
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
2015 vs. 2014 2015/Q4 vs. 2014/Q4
% YoY growth
43
2015 revenue churn
< 5%
0
20
40
60
80
100
120
2012 2013 2014 2015
Axis
Title
P2P SAAS DEMAND RAPIDLY GROWING, ENABLING SAAS REVENUE ACCELERATION
Growth in number of P2P SaaS customers
Alu
sta
SaaS
cu
sto
mers
(in
dexed
)
# of deals 2012-2015 (CAGR): 108%
# of deals (Q4 2015 vs. Q4 2014): 200%
44
CLOUD REVENUES ON SOLID GROWTH TRACK…
Transaction revenue: strong
growth (€M)
• Acceleration of P2P sales and e-
invoicing penetration
• Dedicated focus to small and medium
sized businesses
• Open network through
interoperability partnerships
• Turning point in SaaS growth
reached
• Seeing significant momentum
• Significant growth expected due to:
New sales almost entirely
SaaS
Expanding sales force
Change in billing model45
Financing Services
revenue
2016-18
CAGR:
>30%
2018:
250Mtransactions
SaaS revenue: turning point
reached (€M)
2018 :
>10% of Basware
net sales(with significant upside
potential not included in
estimates)
• Financing Services
unleashed
…WHILE THE BASE SUPPORTS THE CLOUD STORY
Maintenace stable; to erode
gradually (€M)
• Very stable maintenance
business with expected
marginal erosion through
transition to SaaS
License business shrinking
(€M)
Consulting stable with upside
(€M)
• Conversion to SaaS
proceeding according to
the strategy
• License net sales reduced
to mainly add-on sales
• Consulting growth driven
by the accelerating
number of projects and
new value consulting
services balancing
shrinking billable days per
delivery46
2016-18
CAGR:
-5%
2016-18
CAGR:
-25%
2016-18
CAGR:
0-2%
2010 2015 2018 target
Maintenance, license and consulting Cloud revenue
2018 GOAL: €220-280M NET SALES, 2/3 FROM CLOUD BUSINESSES
Cloud based businesses growing fast:
Turning point in business model
change reached
Constant growth year-on-year
Stacking revenues
Maintenance, consulting and license
businesses provide a solid base
Stable and predictable
Gradually declining
12%
88%
40%
60% 1/3
2/3
Note: Cloud Net sales includes SaaS, transaction, Procserve and other Network related Net sales
CAGR
(’15-’18)
~40%
-5-0%
47
€103.1M
€143.6M
€220-280M
Recurring
revenue goal
~80%
Net sales: >50% CAGR
2015 2016 2017 2018
Net sales (indexed)
U.S. EXAMPLE: GOAL TO MULTIPLY BUSINESS; 2015-18 NET SALES CAGR >50%
48
2015 2016 2017 2018
P2P deals (indexed)
2015 2016 2017 2018
Transactions (indexed)
P2P deals: ~6x Transactions: ~10xHeadcount ~2,5x
2015 2016 2017 2018
Personnel (headcount)
Organic plan complemented with continuous M&A target screening
~€20M OPEX INCREASE IN 2016 TO IMPLEMENT NECESSARY ENABLERS
• ~€20M year-on-year increase in operating expense:
Sales
Marketing
R&D, especially Financing Services
Focus on US, UK and Germany
• Investment funded with company cash flows
49
EBITDA MARGIN TEMPORARILY IMPACTED; UNDERLYING PROFITABILITY IMPROVING
2015 2016 2017 2018
Basware totalEBITDA 8%
Transactions Gross
Margin50-60%
SaaS Gross
Margin60-70%
Financing
ServicesGross
MarginN/A 80-90%
Consulting Gross
Margin10-20%
License Gross
Margin~90%
Maintenance Gross
Margin>90%
50
SELECTIVE M&A TO SUPPORT OUR GROWTH TRACK
We are uniquely positioned to leverage M&A for our strategy execution
Extend Basware Commerce Network
Consolidate the market
Focus on attractive “key markets”
US, UK and Germany
Internal capability
History of successful, disciplined M&A
Financial flexibility
51
2018 STRATEGIC GOALS
52
Priority Top line & transaction growth
Net sales €220 to €280 million
• Delivering growth is our #1
priority
• Continuing focus on
growing cloud businesses
and share of recurring
revenue
• Opex increase to implement
necessary growth enablers
• Improving profitability over
time
• Select acquisitions to
accelerate growth
Cloud sales2/3 of total revenue from cloud
businesses
Recurring
revenue ~80% of total revenues
Transactions250 million transactions processed in the
network annually
P2P SaaS
CAGR
Financing
Services
>30% P2P SaaS revenue CAGR over
2016-2018
>10% of Basware net sales (significant
upside not included in estimate)
Enabling priorities and investmentEsa Tihilä, CEO
Summary and conclusionsEsa Tihilä, CEO
Extend cloud Purchase to Pay leadershipIlari Nurmi, SVP Purchase to Pay
TODAY’S FOCUS IS ON THE NEXT PHASE OF GROWTH
53
Starting point for the next phase of growthEsa Tihilä, CEO
Accelerate Network growthVesa Tykkyläinen, SVP Network
2016-2018 Financial implications and goalsNiclas Rosenlew, CFO
13:00-
14:45
15:15-
17:00
Break
Cocktails
Unleash Financing ServicesAd van der Poel, SVP Financing Services
BASWARE: KEY DIFFERENTIATORS
Networked Purchase-to-Pay
Over 2,500 Networked
Purchase-to-Pay customers
Network Leadership
Global Reach with
Open Commerce Network
Financing Innovation
Just in Time
Financing Services
54
FOR INVESTORS
www.basware.com/investors
www.basware.com/annualreport
BASWARE
www.basware.com
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