may 2012 goldman sachs emerging 1 companies … sachs emerging companies ... presentation concerning...
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SAI Global LimitedABN: 67 050 611 642
Goldman Sachs Emerging Companies Conference
May 2012F
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DisclaimerThis document has been prepared by SAI Global Limited (SAI) and comprises written materials/slides for apresentation concerning SAI.
This presentation is for information purposes only and does not constitute or form part of any offer to acquire, sell orotherwise dispose of, or issue, or any solicitation of any offer to sell or otherwise dispose of, purchase or subscribe for,any securities, nor does it constitute investment advice, nor shall it or any part of it nor the fact of its distribution formthe basis of, or be relied on in connection with, any contract or investment decision.
Certain statements in this presentation are forward looking statements which can be identified by the use of wordssuch as “anticipate”, “estimate”, “expect”, “project”, “intend”, “plan”, “believe”, “target”, “may”, “assume”, and words of asimilar nature. These forward looking statements are based on expectations and beliefs current as of the date of thispresentation, being 17 May 2012, and, by their nature, are subject to a number of known and unknown risks anduncertainties that could cause the actual results, performance and achievement to differ materially from any expectedfuture results, performance or achievement expressed or implied by such forward looking statements.
No representation, warranty or assurance (express or implied) is given or made by SAI that the forward lookingstatements contained in this presentation are accurate, complete, reliable or adequate or that they will be achieved orprove to be correct. Except for any statutory liability which cannot be excluded, SAI and its representative officers,employees and advisors expressly disclaim any responsibility for the accuracy or completeness of the forward lookingstatements and exclude all liability whatsoever (including negligence) for any direct or indirect loss or damage whichmay be suffered by any person as a consequence of any information in this presentation or any error or omissiontherefrom.
Subject to any continuing obligation under applicable law or any relevant listing rules of the ASX, SAI disclaims anyobligation or undertaking to disseminate any updates or revisions to any forward looking statements in these materialsto reflect any change in expectations in relation to any forward looking statements or any change in events, conditionsor circumstances on which any statement is based. Nothing in these materials shall under any circumstances createan implication that thee has been no change in the affairs of SAI since the date of this presentation.
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Company overview
Divisional structure and strategy
Performance & investment features
Questions
Agenda
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Company Overview
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SAI TodayProviding information services and solutions for managing risk, achieving compliance and driving business improvement
Market capitalisation ~ $950 millionRevenue ~ $460 millionPeople ~ 1,850
Information ServicesTwo verticals:Standards and PropertyStandards in all forms:hardcopy, pdf, databaseRelated databases andworkflow solutions (e.g.MSDS, materials, EHS)Information brokerageMortgage processing services
Compliance ServicesAdvisory servicesNewsfeeds and alertsGovernance, risk andcompliance (GRC) platformOnline training and awareness courseware via an LMS Hot-line (whistleblower)implementation consultingservices
Assurance ServicesManagement systems and product certificationSupply chain managementAgri-food and retailTraining and improvementservices
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Geographic footprint -April 2012
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Revenue1
Geographic revenue and EBITDA mix
EBITDA1
1. Based on forecast FY12 outcomes
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Divisional Structure & Strategy
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Revenue1
Divisional contributions
EBITDA1
1. Based on forecast FY12 outcomes
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Products and Services - Standards
Service Revenue model Estimated market size ($m) Major competitors
Standards in all forms: hardcopy, pdf, database
Transactional sales and subscription
US$900M• IHS• ANSI• Techstreet
(Thomson)• Standard
Development Organisations (SDOs)
• Perinorm • UL
Related databases and workflow solutions (e.g. MSDS, materials, EHS)
Subscription US$4BnFor
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Standards – Overview of strategy
INDUSTRY VERTICALS: Engineering, building and construction, energy etc
Content led information management and workflowo Financial managemento Strategic sellingo Work flow solutionso Relationship managemento Customer focuso Organisational Effectiveness
2015 Stateo Growing engagement with large
accountso Demonstrated workflow capability
through two solutionso i2i deployed in Asia Pacifico Integrated finance/Infostore/CRMo Strong relationship with SA,
SDO’s and associations
Customers will seeo Standards available globally
through Infostoreo Associations have access to
tailored contento Fit for purpose content managed
through i2io Evident workflow capability
Distribute - hard copy, electronic
(Infostore), subscription
Third party technical documents
Manage content –databases,
portals, standards management – i2i
Commercialise content – fit for purpose content
Content led workflow
solutions – CE marking, WHS etc
Content management
systems
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Path to Content Led Information Management and Workflow Solutions
Global Aggregation of Technical and
Reference Content
InformationManagement
Services
Commercialising Content
IntegratedInformation
Services
Content Value
Simple ResellE-Commerce
Affiliate
Broadcast PlatformNiche markets
SaaSPortals
Content Inside
Fit for PurposeMultiple formats
E-publishingIntegrate/EnhanceCustomer process
Workflows to;Repurpose
ReuseRecycleResell
Building value from content
Information Services
Agile Business development
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Products and Services - Property
Service Revenue model Estimated market size ($m) Major competitors
Information brokerage
Transactional – per document sourced or search undertaken
$500M• Leap Searching• Citec (Qld Govt)• Global X
Mortgage processing services
Transactional – per task undertaken (e.g. document checked, settlement arranged, settlement attended) or per “bundled” service
$275M (includes potential
work not yet outsourced by
financial institutions)
• Perpetual• HP• Scott Ashwood• Gadens
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Property – Overview of strategy
Leading provider of mortgage services and related informationo Secure, stable, scalable
technology infrastructureo Solution development capabilityo Marketing and sales strengtho Excellent operational capabilityo Performance culture
2015 Stateo Processing > 50% of settlementso Scalable settlement platformo Leading conveyancing platformo Leading search platformo Line of site between platformso Operational excellence embeddedo High brand awarenesso Partnerships adding value
Customers will seeo SAI as preferred partnero Solutions that work with SLA’s
meto Lower cost than alternativeso Visibility through transaction
cycleo Excellent service
Settlement Manager
Conveyancing Manager
Search Manager
Banking settlement work flow platform
Property, ASIC etc search platformSolicitors conveyancing practice management system
Line of sight between platforms
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SAI’s property business
Information brokerageProvides information and software to conveyancers, law firms,property professionals and corporations including:
Land and title property searches (e.g. Land and Property Information (NSW), Department ofSustainability and Environment (VIC), Department of Environment and Resource Management (QLD),Landgate (WA), Land Services Group and Land Titles Office (SA))
Certificates from local councils and other bodiesASIC1 director and company searchesITSA2 insolvency and bankruptcy searchesPPSR3 searchesCourt and probate searching
Provides specialised offline (manual) searching related activitiesHistorical title records and searches which are not available online due totheir age and legacy 1
Australian Securities & Investments Commission 2
Insolvency and Trustee Service Australia3
Personal Property Securities Register
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1. Client logs into Search Manager
2. Client orders required information online
3. Client request is actioned in real-time via direct link to supplier database
4. Results of request are stored in Search Manager and emailed to client
5. Fees and transaction details are provided to the client for on charging to their clients
Examples:Land Tiles
Council and otherASIC ITSA PPSR
Court and probate
Information brokerage - workflow
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SAI’s property business Mortgage processing solutions
Provides outsourced, end-to-end mortgage services to large,medium and small financial institutions, mortgage managers,conveyancers and solicitors, across four broad servicecategories:
Document tracking and management servicesPre-settlement activitiesSettlementPost-settlement activities
Through SAI’s development of this business as a corecompetency focused on operational excellence, SAI is able tooffer clients:
A lower fixed cost baseImproved service outcomes
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Mail Packet Return and Document Scanning
Examination / Certification
of Documents
Assess Documents
for Lodgement
Fees
Settlement Booking
Manual and Self Serve Bookings
(SSB)
Cheque Printing Services
Attend Settlement
Stamping & Lodgement
of Documents
Bank Settlement
Funds / Fiserv
Document Dispatch to custodian
Mortgage processing solutions
Pre-settlement activitiesDocument tracking and management
Post-settlement activities
Settle-ment
Settlement Manager
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Opportunities exist to expand revenue base by “filling in the boxes”
Mortgage processing solutions
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Products and Services - Compliance
Service Revenue model
Estimated market size ($m) Major competitors
Advisory services Negotiated sale US$4Bn LRN, Corpedia, EY, EthicsPoint/GCS, Deloitte, KPMG, PWC
Newsfeeds and alerts Subscription US$100M Wolters Kluwer
Governance, Risk and Compliance (GRC) platform
Subscription US$2Bn Thomson, EMC, Wolters Kluwer
Online training and awareness courseware via an LMS
Subscription US$200M LRN, Corpedia
Hot-line (whistleblower) Subscription US$100M EthicsPoint/GCS
Implementation consulting services
Negotiated sale Same market as advisory services All of the above
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Compliance – Overview of strategy
SUBJECT MATTER: Ethics and code of conduct, fraud and corruption control, EHS etc
INDUSTRY VERTICALS: Healthcare, pharmaceutical, financial services, mining and energy etc
A Global Leadero “Own” products, topics, sectorso Suite of integrated solutionso World class technologieso Product management / innovationo Excellent service deliveryo Organisation strengtho Financial strength
2015 Stateo Leader in GRC and e-learningo Leader in ethics, code and B&Co Integrated solutions through GRCo Consolidated platforms and
courseware engineo Multiple delivery mechanismso Global consistencyo Excellent service capability
Customers will seeo Visibility through one portalo Flexibility – online, offline, mobileo Ability to deliver key solutionso Everything just runso Expert (sales, service, product)
engagement with SAIo Service excellence
Assessments and Surveys
Case / Incident
Management
Risk Management
E-Learning- Courseware and Platform
Policy & Procedure
Management
Professional Services
Hotline / Whistleblower
Reporting & Audit
3rd Party risk- Databases & Investigation
s
Content ManagementRegs /stds
Compliance Outcomes
GRC Workflow Platform
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Products and Services - Assurance
Service Revenue model
Estimated market size ($m) Major competitors
Management systems:ISO 9000 and other standards or sector derivatives
Daily rates & annual fees
$4BnSGS, BureauVeritas, DNV, BSI, Lloyds
Product certification:Assesses conformity to local and international standards
Daily rates & annual fees
$3BnIntertek, TUVs, UL, KIWA
Food safety and retail:Supplier compliance, GFSI Certification and inspection
Daily rates & annual fees
$1BnSGS, Silliker, NSF-CMI, Steritech
Standard & system training:Supporting certification & client improvement activities
Rate per course or project
LargeAll of the above, plus various national RTO’s
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Assurance Services – Overview of strategy
SUBJECT MATTER: Quality, food, environmental, health & safety etc
INDUSTRY VERTICALS: Food, automotive, aerospace, manufacturing, mining and energy etc
Establish sustainable competitive advantageo Global capabilityo Services tailored by customer
typeo Outstanding customer serviceo Performance cultureo Focus on growth sectorso Low cost core delivery engine
2015 Stateo Globally service delivery platformo Latin America presenceo Stronger European presenceo Information delivery at top endo Fast, efficient at “small” endo SCM and analytics well developedo Everything measured / managedo Food sector developed globally
Customers will seeo Larger customers – valuable
information on their business &supply chain
o Globally consistent approacho Small customers – fast / efficient
serviceo Excellent service
Certification Audits
Supply chain audits
Related training
Specifier audits
Design review / factory
inspection
Testing
Supply chain management
Analytics and information
Management system certification Product certification
Audit InformationGeneric service Differentiated ServiceTechnology light Technology enabled
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Performance & Investment Features
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Annuity style = subscription arrangement or renewable contracts Non-discretionary = “must have” products and services for customersDiscretionary = neither annuity nor non-discretionary revenue
Nature of revenue streams
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Strong industry demand drivers:Increasing regulatory compliance obligations (e.g. FCPA, UKBribery Act, competition law, trade law)Industry globalisation and outsourcing complexityDemand for embeddable, lower cost, workflow solutions
Increase SAI’s exposure to higher growth products,geographic markets and business sectors
Grow market share by increasing SAI’s competitiveadvantage through superior technology based solutionsIndustry consolidation continues to provide attractiveacquisition opportunities
Growth drivers
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Regulatory demand drivers – ensuring “compliance” isnot a discretionary spend for corporates
SAI has a high proportion of annuity or non-discretionaryrevenue streams
Key exclusive agreements
Leading market positions and brand in Australia underpinperformance
Whilst not immune to weak economic conditions, thebusiness model has resilience to economic slowdowns asdemonstrated during the GFC in 2009
Defensive characteristics
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Medium-term trend organic revenue growth andmargin expectations:
Revenue EBITDAGrowth Margin2
Information Services 6% - 8%1 25% - 30%
Compliance Services 8% - 12% 38% - 42%
Assurance Services 5% - 7% 16% - 20%
Expected organic growth rates
1. Expected to be higher in FY13 due to the impact of new business won by the propertybusiness
2. On gross revenue
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Questions?
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