Swift Networks
• Providers of diversified telecommunications and digital entertainment business providing fully integrated solutions for the Hospitality, Lifestyle Villages, Aged Care, Resources sectors. Services include free-to-air television, pay television, telecommunications, internet, data, wireless networks and streaming video on demand with content from some of Hollywood’s largest studios
• Watch – TV, Pay TV, Movies on Demand, Custom content, videos, Wizzie TV.
• Play – Games, social media, radio etc.
• Connect – internet, Wi-Fi, data, Skype, telephones
• Interact - Alert, bulletins, sales, ads, infographics and analytics
Metrics and USP
• Low market cap (circa $30 Million- fully diluted with current free float mcap - $9 million)
• Low valuation compared to peers such TV2U, Oneview.
• Revenue growth of 17.8% to $14.4 Million for FY16. Q1Fy17 - $3.6 Million
• Rooms serviced grew by 37% to 29,600 rooms.
• Major R&D expense complete ($3.6mil complete)
• Loss from operations $5.25 million out of which $3.47 was nonrecurring non cash cost associated with listing. Almost cash flow positive or will be cash flow positive by end of FY17.
• Margin between 30% (base package) to 40% (full package) and expected to increase over next 3 years
• EBITDA margin expected to grow from 4% in 2016 to 19% by 2018.
• 93% contract rollover/renewal rate
• 97% contracts retention
• 91% tender success
• Scalable model – can service anywhere between 20 to 10,000 rooms
• Exclusive deals and preferred distributor relationships with leaders like Foxtel, Telstra and Optus. Only authorised wholesaler for Foxtel and recently announced contract with Optus – to offer EPL coverage across entire network.
Resource sector
• Size – 110,000
• Current market share: 26%
• Big clients – BHP, Hancock, Alcatel, Lucent, Fortescue metals, Chevron, Rio Tinto, Laing O’Rourke since 2008.
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http://www.swiftnetworks.com.au/projects
• Relationships deepening with recent wins with Rio, BHP, Hancock, NT Gov, Snowy Hydro village,
Hospitality
• Market size in Australia - 248,000 rooms
• Recent wins in Hospitality sector – Auzcorp hotels and deal with Freedom internet to provide Digital Entertainment System to 19,000 hotel rooms for brands such as (min 2000 per quarter) over 3 years.
Aged care/lifestyle sector
• Market size in Australia – 327,000 rooms projected to grow to 900,000 rooms by 2020.
• Recently acquired two service providers in this space.
• Overseas expansion
• No technological barriers to overseas expansion.
• Fully compliant with international regulatory standards.
• Asia pacific resellers and partnership strategies already underway to potential accretive acquisition opportunities.
• Currently, undergoing negotiations/test with first hospital in Philippines for 300 to 1000 rooms prior to national rollout. Potential market size – 1000 hospitals and 78,000 + rooms
• Leverage relationships existing relationships with Australian customers to expand into Singapore, Malaysia and other parts of SE Asia.
Management
• New owners with track record of founding and building business worth $200m+ and $1b revenue
• Original founder’s (Souflis Family) still involved who sold original business to Singapore listed company and retained Swift Network business
• High performance benchmarks –
• Class A performance shares – 16.6 mil shares escrowed till 44,000 rooms or $24 mil in revenue is secure
• Class B performance shares – 16.66 mil shares escrowed till 53,000 rooms or $29 mil in revenue is secured.
Offer overview and interview with CEO – Xavier Kris
http://www.swiftnetworks.com.au/Publications/
April presentation – Listing
http://www.asx.com.au/asxpdf/20160413/pdf/436hbm547qf38h.pdf
Sept presentation
http://www.asx.com.au/asxpdf/20160912/pdf/43b3g4z1df59fq.pdf
(20min delay)