LogNet Information Technologies PLCMay 2014

• Innovative software company of customer experience solutions for multiple verticals

• Core products include Billing, Customer Care and eCommerce

• Major focus on high spending verticals:

• Strong customer base - Over 35 active customers worldwide

• Total of 108 employees• Revenue of $8.4M in 2013 and projection for $11.5M in

2014

Overview

Utility Travel Telecom

Significant Growth Potential

LogNet is well positioned to

capitalize on the vast opportunity

created by the changes in the utility market

Utility

The strategic partnership with Sabre opens up

for LogNet a global reach to thousands of

travel agencies

Travel

The new trend of telecoms to consolidate

multiple services will extend the

need to LogNet’s multiple-play

offering

Telecom

• Revenue surge by 110% between 2010 to 2013• 70% of LogNet’s revenue in 2013 derived from Europe

and Asia compared to zero in 2007• Expanded its product offering to new verticals resulting in

43% of revenues in 2013 derived from utility and travel compared with 18% in 2010

Key Performance Indications

Projected P&L

LogNet Information Technologies PLC                

Profit & Loss - K$               

For the Year 2013 2014 2015 2016 2017 2018               Revenue  Professional Services        4,566         4,770         6,065         7,740         9,175       11,525   Software        2,563         4,059         5,615         7,770         9,695       11,295   MRR (SaaS)           452         1,650         3,965         5,875         8,685       11,810    Maintenance           804         1,054         1,605         2,115         2,645         3,170   Total 8,385 11,533 17,250 23,500 30,200 37,800                 COGS  Professional Services        5,870         6,259         8,500       11,500       15,000       18,000    Other & Third Party           357            400            700         1,200         1,750         2,500   Total 6,227 6,659 9,200 12,700 16,750 20,500                 Gross Profit 2,158 4,874 8,050 10,800 13,450 17,300                 Operating Expenses  Sales & Marketing           602            863         1,600         1,900         2,100         2,400    Depreciation           129            156            250            350            450            500    General & Administrative        1,198         1,381         1,600         1,800         2,000         2,200    Research & Development           611            600         1,250         1,500         2,000         2,500   Total 2,540 3,000 4,700 5,550 6,550 7,600                 Operating Income   -382 1,874 3,350 5,250 6,900 9,700               Finance Expenses             177              88            100            200            250            350                Net Income   -559 1,786 3,250 5,050 6,650 9,350

Expanding to New Verticals

In 2010 LogNet identified a global slowdown in its core telecom business and accordingly invested to expand its product offering to the growing markets of Utility

and Online Travel

Revenue Breakdown by Vertical

51%

22%

21% 6%

2013 - $8.3M

Telecom UtilityTravel Other

33%

38%

23% 6%

2014 - $11.5M

Telecom Utility Travel Other

29%

34%

28%8%

2015 - $17.5MTelecom Utility Travel Other

26%

34%

30%

10%

2016 - $23.5M

Telecom Utility Travel Other

Revenue Breakdown by Territory

35%

34%

27% 5%

2013 - $8.3M

ISRAEL Europe UK ASIA

68%6%

18% 8%

2014 - $11.5MEUROPE & ISRAEL AMERICAAFRICA ASIA

59%18%

15% 7%

2015 - $17.5MEUROPE & ISRAEL AMERICA AFRICA ASIA

52%

23%

12% 12%

2016 - $23.5MEUROPE & ISRAEL AMERICA AFRICA ASIA

Business Model

Selling Perpetual Licenses / SaaS

Providing Professional Services

Maintenance and Support

• Deregulation and implementation of smart meters are significantly changing the manner in which utilities are interacting with their customers and generating revenue

• According to Navigant Research, worldwide revenue from utility billing and CIS software and services will grow from $2.5 billion in 2013 to $5.5 billion in 2020

Utility Market Opportunity

This process is forcing utilities to replace their existing billing systems

• Strong background in telecom billing positioned LogNet to win business with utility providers and municipalities

• Excellent reference from the leading private utility in the UK

• LogNet’s platform successfully supported the growth of First

Utility from 30,000 customers to over 300,000 with a target of 2 million customers

Excellent Utility Reference

• In 2012 LogNet launched a SaaS platform which provides travel agencies a smooth path to go online with a commercial site within weeks

• LogNet’s eTravel enables travel agencies to self manage their site using versatile building blocks, rich style, layout, and branding options

• More than 30 travel agencies are already using the service including 4 out of the top 10 agencies in Israel

LogNet’s eTravel Platform

• Online travel sales will grow from $374 billion in 2012 to $523 billion by 2016 and will account to 50% of the total travel market (eMarketer)

• Online spending on travel in 2012 accounts for more than a third of total e-commerce (comScore)

• Technology spending by the travel industry is expected to grow from $60 billion in 2013 to $70 billion in 2017 (Gartner)

Online Travel Market Size

• The eTravel platform was developed as a joint venture with Sabre Inc.

• The eTralvel service will be sold by Sabre to its existing customer base on a SaaS model at an average price of $1,500 per month

Strategic Alliance with Sabre

Sabre is the leading technology provider to the global travel and tourism industry with annual

revenue of $3 Billion serving 400,000 online and offline travel agents at 55,000 travel agencies

• OSS/BSS global market was valued at $17 billion in 2012, and is expected to reach $48.54 billion by 2018 (Transparency Market Research)

• Growing adoption of multiple-play billing systems is expected to drive the industry over the next few years as service providers are consolidating to offer data, voice and multimedia on the same platform

• The Increasing number of wireless subscribers coupled with high demand for handheld devices such as smartphones and tablets will fuel the growth of the telecom industry in the coming years

Telecom Market

• Provides telecoms to achieve business success in the rapidly changing and highly competitive markets

• Centralized BSS platform supporting multiple services in a single instance, which enables telecoms to efficiently automate business processes

Multiple Play Solution

 “We have developed a rather intricate business model to compete in a highly competitive market and need to constantly deliver a high-end user experience to both our customers and partners. LogNet’s platform gives us a modern solution for billing and overall customer and partner management that will add a completely new dimension to our business.”  Erik Eising, CEO , Infopact, Netherlands  

• LogNet is considering an AIM floatation and raise of 5M GBP

• Proceeds will be used for:

• Establishing sales and marketing presence in the US

• Building a global SaaS platform for utilities and eTravel

• Accelerating growth in Asia and Africa

• Working Capital

Potential AIM Floatation and Use of Proceeds

• Mature product suite with strong customer base and excellent

references

• Proved capability to identify and execute the business strategy

• Broad vertical and geographical expansion

• Significant growth potential

• High visibility of recurring revenue

• Motivated management to maximise the company valuation

Summary