Progress Software. Investor Overview. January 2012

Transcription

1 Progress Software Investor Overview January 2012

2 Progress Software Corporation Forward Looking Statements Various remarks that we may make about the Company s future expectations, plans and prospects constitute forward looking-statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of Actual results may differ materially from those indicated by these forward-looking statements as a result of various important risks and factors, including those discussed in the Company's filings with the Securities and Exchange Commission. In addition, any forward-looking statements represent our estimates only as of today and should not be relied upon as representing our estimates as of any subsequent date. While we may elect to update forward-looking statements t t at some point in the future, we specifically disclaim any obligation to do so, even if our estimates change. For further information regarding risks and uncertainties associated with the Company's business, please refer to the Company's filings with the Securities and Exchange Commission 2

3 Progress Software: At a Glance EMPLOYEES ~ 1,700 An enterprise software company that helps businesses become more operationally responsive ANNUAL REVENUES 20 of the top 20 Banks $>530 million 9 of the top 10 Telco Companies STRONG CASH FLOWS OPERATING MARGINS * ~27% GLOBAL REVENUE STREAMS CUSTOMER DIVERSIFICATION Over $120M annually ~ 53% international 140,000 Customers in over 175 countries 8 of the top 10 Insurance Companies 7 of the top 10 Airlines 7 of the top 10 Hotels 4 of the top 5 Retailers 3 of the top 5 Transport & Logistics Companies 9 of the top 10 Enterprise Software Vendors 3

4 The Responsive Process Management (RPM) Prescription Continuous Business Visibility Sense and Respond to Opportunities & Threats Business Process Improvement Continuously improve your business Operational Responsiveness 4

5 Things can change in a flash What should have happened Visibility Any business can now have a flash crash! Sense & Correlate Response 5

6 RPM: The Vision of the Integrated Suite As simple to use as a single environment Business Process Management Suites Seamless visibility & control Complex Event Processing Business Transaction Management Responsive Process Management (RPM) Business Analytics Business Rules Management Seamless graphical modeling 6

7 Converged RPM Market Opportunity IDC Maureen Fleming Business Navigation Systems $10 Responsive Process Management (RPM) Market Size Estimate $2.5B $6.5B by 2014 $5 Gartner Roy Schulte & Janelle Hill Intelligent Business Operations $0 High 2011 Low Source: Compilation of independent market research Forrester Mike Gualtieri, John Rymer, Mike Gilpin BEP envelope for BPM 7

8 Our RPM Suite of Offerings Solution Accelerators Pattern discovery Modeling & simulation Visibility & control Collaboration Mobility Business Analytics Responsive Process Management Complex Event Processing Business Process Management Suite Business Transaction Management Business Rules Management SOA Governance Enterprise Data Interoperability Enterprise Service Bus ERP CRM.NET DATA 8 J2EE MAINFRAME WEB SERVICES OPENEDGE APPLICATION

9 How Tier 1 Trading Firms Make Progress: Increasing Revenue with High Frequency Trading Pain: Increasing competition in fast moving trading market kt Solution: Rapid evolution of high frequency trading strategies that respond first Value: $100bn+ traded daily 9

10 How Mobile Application Providers Make Progress: Increasing Revenue with Responsive Offers Pain: Missing revenue opportunities to respond to customer location & context Solution: Real time Location and Context Aware Offers Value: New multi million $ revenue streams 10

11 RPM also Driving OpenEdge11 BPM Enabled Advanced Business Language OpenEdge Application Server OpenEdge OpenEdge RDBMS DataServer OpenEdge11 The development platform for agile business applications Incredible application partner ecosystem 1,400+ application partners 5,000+ business apps $5B Progress community annual license revenue Contemporary advancements for relevance RPM enablement OpenEdge BPM Cloud/SaaS Leadership 11

12 Growth Strategy Driven Through Execution of Corporate Priorities Tighten product integration Strengthen field capabilities and capacity Build marketplace momentum for the RPM value proposition Better penetrate t select emerging markets 12

13 We are in the middle of a transition REPOSITIONING FROM Best-in-Class Technology Provider IT decision-maker IT-centric GTM strategy Product silo GTM strategy Small company mentality TO Business Solution Provider Business decision-maker IT-influenced Integrated global field organization Integrated product strategy Scale company mentality 13

14 Despite Changes, Progress Delivered Top Line Growth in 2011 REVENUES NON-GAAP EPS $600M $2.00 $500M $1.60 $400M $1.20 $300M $200M $0.80 $100M $0.40 $0M $ Growth %: +7% +1% Growth %: 33% -9% Operating Margin 22% 30% 27% 14 * Non-GAAP earnings per share excludes amortization of acquired intangibles, other acquisition related expenses, stock-based compensation, option review costs, purchase accounting adjustments for deferred revenue and restructuring costs.

15 Building Larger Volume and Average Deal Sizes Average Deal Size for those direct deals > $100K 500K $360 $355 $350 $345 Averag of Deals >$ # $340 $335 $330 $325 $320 $315 e Deal Size (ttm) 15

16 Cash Flows Will Drive Future Investments Cash & Short-term Investments $400 $126M in Operating Cash Flow in 2011 $350 $300 $200M share repurchase in 2011 $250 $200 $150 $100 $50 $322 $347 $262 $150M Line of Credit Flexibility for M&A in support of growth strategy t $0 Q Q Q

17 Why Invest in Progress New management driving efficiency & growth Integrated product suite has compelling business value for customers wanting operational responsiveness Industry-focused direct field organization with solution delivery capabilities and new potential emerging markets growth New products driving renewed engagement with OpenEdge application partner channel Cash available for strategic M&A and share buy-backs 17

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