Investor Presentation PAUL JARMAN, CEO GREG AYERS, CFO NASDAQ: SAAS

Transcription

1 Investor Presentation PAUL JARMAN, CEO GREG AYERS, CFO NASDAQ: SAAS

2 Safe Harbor Statement Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: All statements included in this press release, other than statements or characterizations of historical fact, are forward-looking statements. These forward-looking statements are based on our current expectations, estimates and projections about our industry, management's beliefs, and certain assumptions made by us, all of which are subject to change. Forwardlooking statements can often be identified by words such as "anticipates," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "could," "potential," "continue," "ongoing," similar expressions, and variations or negatives of these words and include, but are not limited to, statements regarding projected results of operations and management s future strategic plans. These forward-looking statements are not guarantees of future results and are subject to risks, uncertainties ti and assumptions that t could cause our actual results to differ materially and adversely from those expressed in any forward-looking statement. The risks and uncertainties referred to above include, but are not limited to, risks associated with our business model; our ability to develop or acquire, and gain market acceptance for new products, including our new sales and marketing and voice automation products, in a cost-effective and timely manner; the gain or loss of key customers; competitive pressures; our ability to expand operations; fluctuations in our earnings as a result of the impact of stock-based compensation expense; interruptions or delays in our hosting operations; breaches of our security measures; our ability to protect our intellectual property from infringement, and to avoid infringing on the intellectual property rights of third parties; and our ability to expand, retain and motivate our employees and manage our growth. Further information on potential factors that could affect our financial results is included in our Annual Report on Form 10-K, quarterly reports of Form 10-Q, and in other filings with the Securities and Exchange Commission. The forward-looking statements in this release speak only as of the date they are made. We undertake no obligation to revise or update publicly any forward-looking statement for any reason. 2

3 incontact is the leading cloud-based company for the Contact Center marketplace Revenue: $84M 2009 Software Growth: 46% incontact t provides: Network connectivity Call routing software Agent optimization tools Our solutions enable our customers to reduce the cost and improve the quality of every customer interaction. 3

4 Revenue From Two Segments Software Segment Revenue High-margin, recurring revenues from incontact software product suite Telecom Segment Revenue Recurring voice and data services supporting both incontact software customers and legacy telecom customers We do not provide employees or on-premise hardware 4

5 Company Highlights Cloud-based leadership position in a multi-billion dollar market that is expected to maintain a high rate of cloud computing adoption Proven solution with over 650 contact center deployments, fulfilling the demands of today s market Recurring annual software revenue run rate of $31.6 million as of Q4 09 Non-GAAP profitable for the past two quarters Scalable business model can support rapid growth without significant CapEx Strong leadership and sales team 5

6 Experienced Leadership Team 6

7 The Customer Contact Center Contact centers are a primary link between a company and its customers Over 6.8 million agents in the U.S. alone incontact t enables contact t centers to: Provide assistance, solve problems = build customer loyalty Improve agent productivity, morale, and retention Provide repeat and vertical sales opportunities Lower costs Corporations are realizing contact centers can become profit centers. 7

8 North American Annual Addressable Market incontact Annual Addressable Market vs. Total Market Size $4.0 $3.5 $3.5 $3.0 $ in billions $2.5 $2.0 $1.5 $1.5 $2.2 $1.0 $0.8 $1.11 $0.9 $0.5 $0.2 $0.3 $0.0 Outbound Interactive Voice Response (IVR) incontact Addressable Market Workforce Optimization (WFO) Total Market Automated Call Distribution (ACD) incontact believes that its addressable market (1) exceeds $3 billion annually Source: Management estimates based on reports by Contact Babel, DMG Consulting Group and Raymond James & Associates. 8

9 Secular Market Trends and Drivers Cloud-Based Computing Acceptance Enterprises of all sizes are increasingly familiar with the cloud-based computing solution and are more likely to adopt it than ever before, deserting the on-premise model to drive down total cost of ownership (trend facilitated further by poor economic conditions applying pressure to cut costs) The number of hosted contact center infrastructure seats is estimated to grow at an annual rate of 35% in 2010 (1), and by 2013 at least 75% of customer service centers are expected to use some Software-as-a-Service application in their contact center solution (2) At-Home & Multi-Location Contact Centers Companies and governments are leveraging the benefits of at-home and geographically dispersed workers to lower payroll costs, improve the quality and reach of the available labor pool and increase customer satisfaction Legacy solutions do not cost-effectively ti enable companies to realize these benefits Underserved Middle Market Historically difficult access to affordable cutting-edge technologies has deprived middle market contact centers of competitive infrastructure, resulting in large current demand for low-cost cost, all-in- one, best-of-breed solutions Technology Advancements Aging equipment from traditional on-premise vendors is driving contact centers to re-evaluate their provider options and seek new technology with seamless overlay onto legacy systems (1) DMG Consulting (2) Gartner Research. 9

10 incontact Offers Disruptive Cloud-Based Solutions The Old (Premise-based) Way Requires heavy CapEx investment in onsite hardware/ software Multiple vendor point solutions requires IT management and integration challenges Need to scale - buy more boxes Technology constraints and redundant costs not compatible for work-at- home agents 10

11 New Cloud-Based All-in-One Solution No large up-front costs One vendor, all-in-one solution Scalable pay as you go In-network architecture easily supports work-athome agents 11

12 The Choice Premise-Based Buy it upfront, Own it, Integrate it, Maintain it incontact Pay-as-you-go, Use it 12

13 incontact Platform Solution Contact Routing Agent Optimization Network Auto. Call Distributor Interactive Voice Resp. Comp. Telephony Integ. / Chat Speech Recognition Outbound Dialing Hiring Scheduling Coaching elearning Feedback (Survey) Recording Quality Management TDM VoIP Toll Free Local DID All-in-one contact center platform with 24/7 monitoring, scalability on demand, security, multi-tenancy and geographic redundancy 13

14 Lower Total Cost of Ownership Yankee Group Customer-Centric Strategies Real savings in cloud-based solution vs. premises-based solution Agent Seats Total Cost of Ownership % Savings over 5 years 25 Seats 28% Savings 100 Seats 34% Savings 400 Seats 45% Savings Source: Yankee Group,

15 Customer Case Study Problem Growth stunted by inadequate hosted telephony service Excessive system downtime 25% of revenues unbillable Outsourced customer support center Solution incontact call routing Results 400% growth in two years 99.99% system uptime All agent revenues captured Agent utilization doubled 60% at-home workforce 15

16 Customer Case Study Problem Growth stunted by inadequate hosted telephony service Integrate multiple CRM systems, back offices, and a centralized contact center Solution incontact call routing integrated with multiple systems, connecting 14 dealerships 14 multi-franchise auto Results dealerships Call time decreased from 5 minutes to 1 minute 23 seconds per call Gained a 350 percent increase in production Market response time down from 3 months to 1 day Cost per call cut from 83 cents down to 23 cents Increase agents calls-per-hour from 12 to 43 16

17 Customer Case Study Problem Growth stunted by inadequate hosted telephony service Hire highly-specialized employees across North America Avoid infrastructure investment Allow for in-depth systems integration Premium remote technology services provider Solution Nationwide at-home workforce facilitated by incontact Results Hire anyone, anywhere with work-from-home model Annual savings estimated at $3.4 million Initial installation saved tens of thousands of dollars Annual productivity at 88 percent Average absenteeism 4 percent of payroll hours 17

18 Industry Recognition

19 Why We Win Against On-Premise Competition Faster ROI through pay-as-you-go model & limited set-up expense Remove complexity from customer for scalability, redundancy, security, hosting and IT expertise End-to-end solution with ACD, IVR, CTI combined with WFO solutions Enable at-home and multi-location l contact t centers to seamlessly integrate with existing infrastructure Upgrade contact centers infrastructure without purchasing new PBX phone system One throat to choke with combined software and network solution providing higher service levels and simplified billing 19

20 Why We Win Against Other Cloud-Based Competitors Most complete cloud-based product suite with ACD, IVR, CTI, combined with WFO solutions Proven provider with the most contact center customers, and enterprise implementations Highest uptime guarantee (99.99%) Unique network + carrier background, multiple & flexible connectivity it options Enterprise level selling organization with significant industry expertise One throat to choke with combined software and network solution providing higher service levels and simplified billing 20

21 It s Working Over 650 contact center deployments Used by over 60,000 agents in 32 countries More than 20 Fortune 500 customers Over 100 integrations to top CRMs, including salesforce.com and Microsoft Dynamics CRM 21

22 A Few of the 650+ Services Technology Utility Healthcare Retail BPO / Outsourcer

23 Go-to-Market Strategy incontact sells all-in-one cloud-based solutions to contact centers in companies of all sizes, from mid-market to the enterprise To complement its software offering, incontact also provides telecom services Through strategic relationships, incontact utilizes a Leveraged Direct Sales model to deliver its solutions 23

24 Strategic Relationships Leverage our product with their presence 24

25 How We Grow Quarter New Customers Upsells to Existing Customers Total New Contracts Q Q Q Q Revenue growth achieved through adding new accounts and selling additional products into existing accounts. 25

26 Financial Highlights Multiple Revenue Sources Today higher-margin Software segment drives sales Software revenue growth of 46% in 2009 over previous year Software revenue contribution grew from 29% in Q4 08 to 38% in Q4 09 Telecom segment Legacy telecom customers (not a focus) Telecom supports connectivity needs of software customers 72% of gross profit is currently generated from software and software-related telecom sales Software retention rates of nearly 93% EBITDAS continues to grow and has been positive for last 6 quarters 26

27 Software Revenue Growth The Power of Recurring Revenue $ in Millions Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q

28 Condensed Statement of Operations ($ millions) '09/'08 Delta % Delta Software revenue % Telecom revenue (4.6) -8% Total revenue % Software Costs % Telecom Costs (3.1) -7% Total costs of revenue (2.6) -5% Gross profit % Software gross margin 45% 54% 67% 13% 24% Total Operating expenses (0.8) -2% Income (loss) from operations (6.8) (9.8) (1.8) % Total Other Expense % Net income (loss) (7.5) (10.3) (2.9) % EBITDAS 0.8 (2.0) % 28

29 EBITDAS 2,500 2,000 ands $ in Thous 1,500 1, ,000-1,500 Q2 Q3 Q4 Q1 Q2 Q3 Q

30 Investment Metrics - SAAS Stock Price: $3.28 Market Cap: $102.7MM Consolidated Q4 09 Revenues: $20.8MM Cash: $10.9MM Total Assets: $38.9MM Debt: $10.3MM Shares Outstanding: 34.8MM Shares Fully-Diluted: 40.9MM Management & Directors Ownership (F.D.): 14% Institutional Ownership: 47% Research Coverage: 4 Analysts 30

31 Investment Summary Cloud-based leadership position in a multi-billion dollar market High-margin recurring revenue model Y/Y software revenue growth of 31% in Q4 09 Strategically positioned for continued rapid growth Under-penetrated U.S. market Vertical sales and expansion within existing accounts Leverage strategic partnerships International expansion Scalable business model with minimal CapEx Strong, motivated management and sales teams 31

32 For More Information Greg Ayers, CFO incontact, t Inc t Neal Feagans, Investor Relations Feagans Consulting, Inc