CEOs Address to Shareholders
+61 3 9684 7900 Info@cptglobal.com November, 2021 www.cptglobal.com 1 Fellow Shareholders, Thank you for making the time and effort to be here today and welcome to our shareholders who are watching the AGM remotely. It is a great privilege to be able to present to you today, my first AGM as the CEO of the company. I'm truly and humbly honoured to be leading CPT into its next chapter and setting the course for the company's future. However, I would like to start by thanking Gerry Tuddenham and recognising the enormous contribution he has made to CPT since founding the business in 1993. CPT listed on the ASX in 2000 and Gerry, as Managing Director, has led the expansion of the business into North America, Europe and Asia, pioneered mainframe cost reduction services using a risk/reward model, built a global team of technical experts and a client list that is the envy of any consulting company. Having guided CPT through the Covid-19 pandemic and to our most profitable year ever in 2021, Gerry has handed me the reins to CPT with the business in a strong financial position and a bright future. We are not saying goodbye to Gerry as he will continue to play a significant role at CPT as a director and in the delivery of our software strategy. I would like to thank Gerry for his service to CPT as Managing Director, his guidance, support and mentorship in my career and I look forward to the contribution he will make in the coming years. Now that Australia and much of the world is opening back up, the timing for this transition couldn’t be better. After taking the first flight to Melbourne, I’ve spent the last two weeks in productive meetings with leadership, management, and the board. Getting everyone together again is helping us align strategically and reconnect as a team after almost two years of lockdowns. It goes without saying that everyone is excited about what’s happening and where CPT is headed. Where CPT Global is today CPT Global made incredible progress in FY2021. A couple of statistics bear that out: 1. revenue grew an outstanding 33% to $33.3m; 2. the net profit of $3.4m was extraordinary and our best result ever; 3. the net profit margin of 10.2% was also record; and 4. a 5.0 cent per share fully franked dividend. November, 2021 2 Lockdowns and travel restrictions were a double-edged sword for the business. Our ability to grow revenue was impacted without face-to-face meetings, however, our globally mobile workforce saved CPT $1m in travel related costs over the previous year. The strong organic growth in revenue was primarily driven by the Australian segment with a 51% increase on the previous year, and the USA, with a 35% increase on the previous year. Financial Services and Insurance were strong growth sectors in Australia and the USA with most of the growth coming from existing clients. Australia also saw growth in the Government sector. Extended lockdowns, border closures and client cost-cutting in Canada made business conditions difficult. We were able to deploy our Canadian sales and delivery resources in the USA markets which helped drive revenue growth and kept our Canadian staff engaged on profitable projects. We managed our European, Canadian and Asian regions opportunistically in FY2021 as we focussed our resources on the growth opportunities in Australia and the USA. Our consultants and sales teams in Europe and Canada continue to support the USA. For the 4 months to 31 October 2021 our unaudited profit before tax was $1.0m on $10.6m in revenue. This is a slightly better result than our expectations as the USA business continued to perform strongly and clients are still requiring consultants to work remotely. Our sales team in North America are starting to travel again but this is still limited as clients are maintaining remote and flexible work practices. In the past two years we’ve also made significant progress on our software strategy. We are targeting Q3 and Q4 to beta test our first tool, which has received interest from existing clients who are ready to deploy the moment it releases. Subject to successful testing and deployment on existing engagements, the tool could be ready in the 2023 financial year. We are not providing further guidance on future performance as there is still significant uncertainty and risk, particularly in the second half of FY2022 with Australia just starting to re-open internal borders and beginning to re-open international borders. While the last 2 years have been tough for everyone, it's hard to imagine other companies where people come to work every day bringing such a strong sense of engagement and drive for the work we're doing – which is just one of the many reasons why I am so energized about leading the business. Between our incredibly bright and experienced team and Gerry’s visionary leadership, the company has become something special that I'm proud to continue growing. But the most important thing for me is – and always will be – staying close to our mission of leveraging our team's unsurpassed skill, knowledge, and experience to empower tech-driven enterprises around the world. Since the launch of advanced technologies, there's never been more opportunities for our clients and our company, and these opportunities are only going to grow over time. It's my plan to scale CPT with them, which will enable us to capitalise on our company's strengths to deliver more services and solutions across every generation of tech, from mainframes to the cloud to the promising technologies that lie ahead. November, 2021 3 I am thrilled to bring a new vision, clarity of purpose, and understanding of CPT Global's role as technology leaders to some of the world's largest enterprises. I'm also eager to continue working closely with our customers to help them improve their business outcomes and customer loyalty while enhancing and leveraging technology that makes sense for them now and in the future. What our clients and shareholders can expect In the coming years, CPT Global will be announcing a number of exciting new initiatives that will help us deliver even higher levels of service to companies ripe for technology transformation. In addition, we're going to focus on expanding our team and network of partners around the world – bringing more capabilities to our clients in over 70 countries. As more businesses move from the mainframe to the cloud, CPT Global will continue to provide the full suite of solutions to our clients in migration, modernization, and management. Our work on mainframes will also continue, bolstered by our cloud and connected technologies expertise that will only strengthen as we consider new partnerships with global leaders that are entering the mainframe space such as AWS and Google. While change is inevitable when it comes to IT, the mainframe continues to be a major player in many companies’ technology stacks for its stability, reliability, and security. As businesses adopt today’s technologies or fully shift to new ones, our team's expertise will prove to be even more invaluable in providing the best experience for clients making this challenging transition. In short, the future for CPT Global looks extremely bright and I’m honored to continue leading this dedicated, innovative, and passionate team into the next chapter. Conclusion CPT has always stood for Capacity planning, Performance tuning, and Testing on mainframes and beyond. But it could just as easily describe our Commitment to People and Technology, both internally and with clients. As a team, we've never been more energised for the company's future as we make strategic plans to grow our offerings, become more competitive globally, and build and strengthen relationships that can help our clients realize their technology potential. While my experiences with my father and in business have shaped me into the leader I am today, I'm fortunate to have a team and clients that only add to my passion and drive for CPT's future. As we embark on this new journey, I will work to ensure that we're all moving forward, together. Thank you. CEO PRESENTATION 18 D I S C L A I M E R This presentation contains general information about the activities of CPT Global (CPT) which is current as at 25 November 2021. It is in summary form and does not purport to be complete. It presents financial information on both a statutory basis as well as information provided on a non-statutory basis. This presentation is not a recommendation or advice in relation to CPT or any service offered by CPT and it’s subsidiaries. It is not intended to be relied upon as advice to investors or potential investors and does not contain all information relevant or necessary for an investment decision. It should be read in conjunction with CPT’s other periodic and continuous disclosure announcements filed with the Australian Securities Exchange, and in particular the results for the year ended 30 June 2021. These are also available at cptglobal.com. No representation or warranty, express, or implied is made as to the accuracy, adequacy or reliability of any statements, estimates or opinions or other information contained in this presentation. To the maximum extend permitted by law, CPT it’s subsidiaries, and their respective directors, officers, employees and agents disclaim all liability and responsibility for any direct or indirect loss or damage which may be suffered by a recipient through use of or reliance on anything contained in or omitted with this presentation. No recommendation is made as to how investors should make an investment decision. Investors must rely on their own examination of CPT, including the merits and risks involved. Investors should consult with their own professional advisors in connection with any acquisition of securities. The information in this presentation is for general information only. To the extent that certain statements contained in this presentation may constitute “forward-looking statements” or states about “future matters,” the information reflects CPT’s intent, belief, or expectations as at the date of this presentation. Subject to any continuing obligations under applicable law or any relevant listing rules of the Australian Securities Exchange, CPT disclaims any obligation or undertakings to disseminate any updates or revisions to this information over time, Any forward-looking statements, including projections, guidance on future revenues, earnings and estimates, are provided as a general guide only and should not be relied upon as an indication or guarantee of future performance. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause CPT’s actual results, performances or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Neither CPT, nor any other person gives any representation, assurance or guarantee that the occurrence of the events expressed or implied in any forward-looking statements in this presentation will actually occur. In addition, please note that past performance is no guarantee or indication of future performance. All amounts are in Australian dollars unless otherwise indicated. WHERE CPT GLOBAL IS TODAY 33.3m Revenues up 33% vs. prior year R E V E N U E Compared to $3.3m loss in FY2020 N E T P R O F I T 3.4m A new record for the company N E T P R O F I T M A R G I N 10.2 Boosted Revenue and set all-time highs for full-year profits. F Y 2 0 2 1 K E Y N U M B E R S Fully franked. $2m in franking credits available D I V I D E N D 5.0 CPT exceeded forecasted expectations in FY2021, resulting in a banner year for the company. Revenue Goodwill impairment Profit Before tax Tax Expense Profit after tax but but before impairment 33.3 m 24.9m 3.4 m Profit before tax & impairment 4.5m 0.9m -4.2m 0 4.5m -3.3m 1.1m 0 0.9m Net profit -3.3m 3.4m EPS (basic) -8.73 cents 8.77 cents Dividend 1.25 cents 5.00 cents FY 2021 FY 2020 Cash 3.1m 4.3m Net Assets 2.7m 5.2m 10 Y O Y C O M PA R I S O N • • • Grow the Pipeline Explore Innovations Manage Costs & Talent • • • • 13 CPT aims to build on the past year’s momentum and lay the groundwork for innovation. F Y 2 0 2 2 S T R AT E G Y WHAT OUR CLIENTS AND SHAREHOLDERS CAN EXPECT T H E V I S I O N How We Do It What We Do Role of Software 4 Company software innovations poised to be a game changer in the next 5 years 14 F U T U R E O U T L O O K We w ill p la y t o o u r s t re n gt h s : t e ch n ica l e xpe rt ise , re su lt s fo cu s e d, a t ru s t e d p a rt n e r, s u cce s s fu l de live ry a n d o u r p e o p le a n d cu lt u re MAINFRAME CONTINUES TO BE A MA JOR PART OF COMPANIES TECHNOLOGY STACK CONSULTING BUSINESS PRIMED FOR GROWTH IN AU & US C apacity planning , P erformance tuning, T esting Manage Costs & Talent • • 13 C ommitment to P eople and T echnology Contact firstname.lastname@example.org cptglobal.com cpt-global
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