Financial and operational results12 months to 31 December 2019
Disclaimer
2
This presentation has been prepared on behalf of the Getech Group plc (“the Company”) solely for information and should not beconsidered to be an offer or solicitation of an offer to buy or sell or subscribe for any securities, financial instruments or any rights attachingto such securities or financial instruments.
In particular, the information contained within this presentation is given in summary form and does not purport to be complete. Thispresentation does not contain all the information that is or may be material to investors or potential investors in respect of the holding,purchasing or selling of securities or other financial products or instruments, the information contained including forecast financialinformation, should not be considered as advice or a recommendation to investors or potential investors in relation to holding, purchasing orselling securities or other financial products or instruments.
The contents of this presentation should not be considered to be legal, tax, investment or other advice, and any investor or prospectiveinvestor considering the purchase or disposal and before acting on any information should consider the appropriateness of the informationhaving regard to these matters, any relevant offer document and should seek independent advice.
The presentation is not directed to any person in any jurisdiction where (by reason of that person’s nationality, residence or otherwise) thepublication or availability of the presentation is prohibited. Persons in respect of whom such prohibitions apply must not access thepresentation.
The presentation is intended for use by professional and business investors only.
This presentation has not been approved by an authorised person in accordance with section 21 of the Financial Services and Markets Act2000 (as amended) of the United Kingdom. As such, this presentation is only being distributed to, and is only directed at, qualified investorswho are (i) investment professionals falling within Article 19(5) of the UK Financial Services and Markets Act 2000 (Financial Promotion)Order 2005 (the “Order”); or (ii) high net worth entities falling within Article 49(2)(a) to (d) of the Order, or (iii) other persons to whom itmay otherwise be lawfully communicated (all such persons together being referred to as “relevant persons”).
This presentation and its contents are confidential and proprietary to the Company, and no part of it or its subject matter may bereproduced, redistributed, passed on, or the contents otherwise divulged, directly or indirectly, to any other person (excluding the relevantperson’s professional advisers) or published in whole or in part for any purpose without the prior written consent of the Company. If thispresentation has been received in error it must be returned immediately to the the Company.
This Presentation should not be relied on by the its recipients, their advisors or any other person. No undertaking, representation, warrantyor other assurance, express or implied is made or given by or on behalf of the Company or any of its directors, officers, partners, employees,agents, advisors or any other person as to the accuracy, completeness, or adequacy of the information or opinion contained within thispresentation and no responsibility or liability is accepted by any of them for any such information or opinions.
12-months to 31 December 2019
• Revenue £6.1m (2018: £8.0m) plus new forward sales of £2.4m (2018: £1.7m)
• Orderbook increased by 48% to £3.1m at 31 December 2019
• Annualised Recurring Revenue £2.3m at 31 December 2019
• Adjusted EBITDA £0.9m (2018: £1.3m), reflecting positive impact of lower total costs
• Net cash £2.7 million at 31 December 2019 (31 December 2018: £0.5 million), with
the Group generating operating free cash in H2 2019.
• Non-core property asset with an ‘in use’ value of £2.4m
Geoscience & GIS for Energy and Natural Resources
We map the structures and systems that
shape the Earth’s crust
Geoscienceknowledge
Create, store, integrate, manipulate, analyse and visualise
Geospatialexpertise
Covid-19 and Outlook
• Move to homeworking has been smooth – projects remain on time and to cost
• Capital preservation - monthly Group costs have been lowered by c26%.
• Retain further flexibility but have mantained capacity to deliver our orderbook
and to maximise the value of sales conversations and new business activities
• 2020 will be very challenging, but our balance sheet strength, orderbook and
transferable skills will be key to weathering this storm.3
We supply the expertise, support and knowledge that companies and governments need to
better discover, develop and manage Natural Resources
Covid-19: deeper + faster capex cuts than 2009 or 2015
Capex -$128bn; Opex -$18bn; dividend and buybacks -$32bn
Cuts have been deepest in unconventional settings
Source: Rystad Energy, Stifel estimates
-26%
Upstream oil and gas capital spending (US$ bln)
4
70
75
80
85
90
95
100
105
Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4
2015 2016 2017 2018 2019 2020 2021
World Production (mmbbls/d)
World Consumption (mmbbls/d)
//
0
Demand and Supply balance returning
Demand fell suddenly
and unexpectedly
Production response
has built in momentum
Demand recovery and
supply reductions
forecast to reduce
global stock build
Brent has doubled since
its low on 21 April-5
0
5
10
15
Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4
2015 2016 2017 2018 2019 2020 2021
Build (mmbbls/d) Draw (mmbbls/d)
Source: EIA
Source: EIA
Crude oil – global production and consumption
Global oil stock change – history and forecast
forecast
5
Long-run prices are important – but so is confidence
Brent forward curve bottomed in late April
Whole curve has since moved higher• Contango has flattened - lowers the incentive to store crude• Points to an improving physical demand/supply balance.
Long end of the forward curve is now cUS$2/bbllower than on 1 Jan 2020
WTI is now higher than on 1 Jan 2020
The unexpected catalyst for the fall, the speed and depth of demand destruction, and
remaining future uncertainty leave our customers cautious
Brent futures curve (US$/bbl)
$20
$25
$30
$35
$40
$45
$50
$55
$60
$65
$70
2020 2021 2022 2023 2024 2025 2026 2027 2028 2029
10 January 2020
02 June 2020
21 April 2020
6
Core customer markets have been hit hard
Energy Investment – pandemic has hit every part of the energy sector (US$bln)
• Valuable mix of supermajors, independents, governments and IGOs
7
Energy Investment – pandemic has hit every part of the energy sector (US$bln)
Targeting growth along the energy value chain
• Valuable mix of supermajors, independents, governments and IGOs
• We are beginning to diversify in target areas across the energy value chain
• This adding to our broader ‘natural resource’ market exposures8
Excellence in our core business
Essential data for reducing exploration risk
• Multi-Sat 2020 - customer-funded upgrade
• Government Advisory - supporting Sierra Leone Government, providing access to seismic and well data
9
Understand the earth’s evolution, to better predict the location of its natural resources
• Thermal mapping R&D delivers new Heat Flow data
• Focus enhancements - N America, Devonian and Carboniferous
• Enhanced Globe analysis tools to explore past climate conditions
• Innovation R&D workstreams e.g. micro-seep detection solution
Exploration Risk Management - Operational Efficiency -Production Optimisation - Site Analysis and Planning
• New well pattern design capabilities - meet evolving market needs
• Future-proofing our products by releasing ArcGIS Pro versions
• Teams awarded “Release Ready Specialty” by Esri
Expertise deployed into new markets
10
Geospatial for HSE
Improve situational awareness
and crisis response
• Real time monitoring
• Integrate multi-source data
• Visualize and share all key information with one map view
• Fast spatial analysis of an impending event
• An informed incident response plan in minutes
Maps AppsAnalysisData
Geospatial for Pipelines
Ensure system integrity and
regulatory compliance
• Design, implement and deploy a PODS (Pipeline Open Data Standard) database
• Track the status & health of your pipeline assets
• Spatial alignment of historical data sets
Geospatial for Renewables
Optimize site location and
monitor operations
• Site Suitability Analysis: solar and wind energy potential, substrate, visual impact assessment
• Monitor assets in real time and optimize activity: construction, HSE, inspection and maintenance
Financial Review12 months to 31 December 2019
11
Protecting profitability
Revenue £6.1m (2018: £8.0m)
Fwd. Sales £2.4m (2018: £1.7m)
EBITDA £0.9m (2018: £1.3m)
• Profitability protected by lower costs
Revenue and EBITDA margin
Costs 16% below 2018 (£6.4m)
Expanded investment:
• Staff pay and product development
• Additions to sales, marketing, project management
• Innovation
Post year end, c26% reduction in monthly costs from May 2020
• Salary reductions
• Loan capital repayment holiday
• Job retention scheme / PaycheckProtection Program
Cost base management (like-for-like)
-
2,000
4,000
6,000
8,000
10,000
12,000
FY-2016 FY-2017* FY-2018 FY-2019
Co
st b
ase
(£'0
00
)
Cost base excluding exceptional items Exprodat 10.5mth
12
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
FY-2016 FY-2017* FY-2018 FY-2019
EBIT
DA
mar
gin
(%
)
Rev
enu
e (£
'00
0)
Revenue Adjusted EBITDA margin**
**Adjusted for exceptional items
Building revenue for the future
Product margins increase
• Product sales mix
• Increased product investment
Services return to profit
• Q4 2018 cost reductions
• GIS and G&M growth
• Continue to target 25% margin
Recurring revenue growth + Order book growth
Orderbook £3.1m from £2.1m in 2018
• £2.5m will be 2020 revenue
• £0.6m in 2021 and beyond
• Orderbook additions made YTD 2020
ARR £2.3m, 2018 level maintained
13
-
500
1,000
1,500
2,000
2,500
3,000
3,500
FY-2017* FY-2018 FY-2019
Ord
erb
oo
k /
AR
R (
£'0
00
)
Orderbook ARR
Gross margin
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
FY-2016 FY-2017* FY-2018 FY-2019
Gro
ss p
rofi
t m
argi
n (
%)
Products Services
Strengthening balance sheetCash flow analysis
14
FY-2016 FY-2017* FY-2018 FY-2019
Cash generated from operations 777 1,221 1,270 934
Cash tax (payments)/receipts (326) 437 514 37
Internal investment:
Globe & Software investment (824) (804) (861) (1,108)
Building Reports (1,036) (427) (13) -
After internal investment (1,409) 427 910 (137)
Movement in working capital 326 472 (1,919) 2,525
Restructuring costs (26) (113) (197) -
Other capital expenditure (5) (9) (78) (35)
Acquisitions (240) (400) - -
Financing (138) (297) 244 (199)
Dividends (572) - - -
Net cash flows (2,064) 80 (1,040) 2,154
Small drop in cash generation vs revenue
Lower cash tax receipts in 2019 due to increased 2018 profitability
Increased investment in Globe + Software
Working capital movement relates to large sale at end-2018
Loan refinanced in 20182019 includes lease payments (IFRS 16)
Net cash + net current receivables
-500
-
500
1,000
1,500
2,000
2,500
3,000
3,500
FY-2016 FY-2017* FY-2018 FY-2019
Cas
h (
£'0
00
)
Net cash Net current receivables Net cash plus net current receivables
• Cash balance £3.6m (2018: £1.4m)
• Careful management of capital
• Cost saving measures
• Strengthened balance sheet year-on-year
Getech’s financial strength, our flexibility and the transferable nature of our skills and technologies give us the toolkit to successfully navigate what are exceptional commercial conditions. Our aim is to exit this crisis stronger than we entered.
12-months to 31 December 2019
• Revenue £6.1m (2018: £8.0m) plus new forward sales of £2.4m (2018: £1.7m)
• Orderbook increased by 48% to £3.1m at 31 December 2019
• Annualised Recurring Revenue £2.3m at 31 December 2019
• Adjusted EBITDA £0.9m (2018: £1.3m), reflecting positive impact of lower total costs
• Net cash £2.7 million at 31 December 2019 (31 December 2018: £0.5 million), with the Group generating operating free cash in H2 2019
• Non-core property asset with an ‘in use’ value of £2.4m
Conclusions
Outlook
• Move to homeworking has been smooth – projects remain on time and to cost
• Capital preservation - monthly Group costs have been lowered by c26%.
• Retain further flexibility but have mantained capacity to delivery our orderbook and to maximise the value of sales contestations and new business activities
• 2020 will be very challenging, but our balance sheet strength, orderbook and transferable skills will be key to weathering this storm.
15
Appendixcase studies
16
Finding natural resources (c.90% of revenue) Managing natural resources (c10% of revenue)
Product-led focus on our customers’ operational needs
Basin Prospect
Gravity & MagneticSeismic & Well Data
Globe Earth Model Exploration Analyst software
Visualise Understand Site Selection
• Locate basins• Understand basin
evolution• Analyse basin fill
• Plate movements• Past climate• Reservoir-Source
distribution and quality
• Play-based exploration
• Identification of low risk locations
Unconventionals Analyst software
Apps, maps, workflow
Manage Esri Gold Partner
• Shale resource• How many wells &
pads to drill?• Reserve booking
• Inspect• Visualise• Ensure integrity• Bespoke dashboards
Government AdvisoryLicense Round Management
Gravity & Magnetic SolutionsGeoscience ServicesAnalysis, interpretation
Save Time & Money
17
Data case study – Targeted campaigns, catalyst focusedEssential data for lowering exploration risk
InnovationBrokerage License Round Advisory
• Gravity & Magnetics – global coverage multiple times larger than our closest peer
• Data portfolio enriched by innovation and grown through reputation
• Seismic and wells - diversification through Government Advisory
• Essential data matched with commercial catalysts
18
Knowledge case study – Globe knowledge productEarth’s evolution unlocked for better exploration
A geospatial knowledge product reaching back through 300 million years to provide the evidence needed for modern day exploration decisions
Understand how the evolution of the planet has controlled the location of natural resources - so you can find them today
palaeogeographies
structural geology
palaeoclimate
thermal mapping
Globe video: getech.com/globe
19
Analysis case study - Unconventionals Analyst softwareWell planning and reserve area mapping made easy
✓ Powerful analytics
✓ Enhanced visualisation
✓ Improved data integration
✓ Proprietary algorithms
• Onshore shale - Well Planning and Reserve Mapping made easy
• Quickly identify the optimal development - most efficient mix of lateral lengths and pads
• Minimise the costly surface footprint and environmental impacts
• Maximise lateral lengths for increased production
• Evaluate reserve areas and forecast volumes during production
20
New business case study – RenewablesOptimize site location and monitor operations
21