Pegasystems Inc. August 2006

Transcription

1 Pegasystems Inc. August 2006

2 Safe Harbor Certain statements contained in this presentation may be construed as forward-looking statements as defined in the Private Securities Litigation Reform Act of The words believe, expect, hope, anticipate, plan and similar expressions identify forward-looking statements, which speak only as of the date the statement was made. The company does not undertake and specifically disclaims any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These statements are based on current expectations and assumptions and involve various risks and uncertainties, which could cause the Company's actual results to differ from those expressed in such forward-looking statements. These risks and uncertainties include volatility of our quarterly operating results, difficulty in predicting the completion of product acceptance and consequently the timing of our license revenue recognition, the level of term software license renewals, our ability to develop new products and evolve existing ones, the impact on our business of the ongoing consolidation in the financial services and healthcare markets, our ability to attract and retain key employees, reliance on certain key thirdparty relationships, management of the Company s growth, and other risks and uncertainties. Further information regarding these and other factors which could cause the Company s actual results to differ materially from any forward-looking statements contained in this presentation is contained in the Company s most recent form 10-K and other recent filings on file with the Securities and Exchange Commission. Investors are cautioned not to place undue reliance on such forwardlooking statements and there are no assurances that the matters contained in such statements will be achieved. 2 Pegasystems 2006

3 About Pegasystems Software to optimize business processes Founded 1983, until 2002 sold: Purpose-based applications for banks and healthcare, primarily exceptions management and membership 2003 introduced PegaRULES Process Commander: All-purpose business process management (BPM) platform 3 Pegasystems 2006

4 PegaRULES Process Commander Strong Market Acceptance PRPC-related revenue as percentage of total ~ 2% 2003 ~ 24% 2004 ~ 75% 2005 Recognized leader in smart Business Process Management (BPM) Worldwide customer base includes Fortune 500 and other leading corporations 4 Pegasystems 2006

5 PegaRULES Process Commander Pegasystems software unifies business rules with system processes SmartBPM Automates all interactions: human-to-human (ex: CRM; workflow) human-to-system (ex: account opening; applications) system-to-system (ex: system integration; EAI) Using wizards, forms and GUIs rather than lines of software programming 5 Pegasystems 2006

6 Build for Change, Without Code Automates the Programming Familiar Office tools (Visio, Word, Excel) accessed via web browsers Wizards, forms and GUIs replace paper specs and requirements Automatically generates optimal Java CT CA MA NY RI 6 Pegasystems 2006

7 Only Pega Drives Processes Via Rules Gartner Magic Quadrants BPMS Pegasystems Rules IBM Sybase Magic Microsoft Oracle AMS Unisys Fair Isaac Computer Associates ILOG Pegasystems Gensym Pegasystems Mindbox Haley SoftLaw RulesPower ESI Versata Exsys Resolution EBS Pegasystems Yasu Elity A business rule engine will be the heart and soul of Business Process Management Suites going forward Jim Sinur Gartner Forrester Wave TM : Human-Centric BPMS, Q1 06 Forrester Wave TM : Business Rules Platform for IT, Q Pegasystems 2006

8 Automates All Types of Interactions Productivity & Quality Alerts Model & Simulate Open Database Just-When-Needed Retrieval Best Source Tailored Interactions Skill Based Routing Cases & Folders Priority Telephony Scan & Fax System-Driven Processing Browser Web Services 8 Automated Transactions Pegasystems 2006 Guided Processing Proactive Follow-up

9 Pegasystems Customers Successes Growth 25% increase in cross and up-sell $8M in lost margin recovered Membership up 48% with same staff Customer acquisition up 15-30% Time to market cut 18% Productivity 40% increase in productivity $100M+ in taxes saved in year 1 80% efficiency improvement New hire training cut 60% Claims processing cut 50-70% Compliance Automate compliance reporting Avoid material weaknesses Reduce auditing expense 20 25% 9 Pegasystems 2006

10 Pegasystems Past and Present Lineage Today Bifurcated strategy, apps and BPM platform BPM platform drives product line, suite of lighter frameworks Legacy account coverage PEGA only All or nothing, RFP sales One and done Affinity hires and assignments Partner network Imagineering, quick value initial sale Follow-on opportunities 10 Pegasystems 2006

11 Pegasystems 2Q 06 Summary Results Income Statement Summary (In millions, except per share data) 2Q Q 2005 Total Revenue $ 29.6 $ 23.8 License Revenue $ 6.9 $ 8.0 Services Revenue $ 22.7 $ 15.8 Pre-Tax Income $ 0.2 $ 0.5 2Q 2006 $8.8 million license signings to be recorded as future revenue 2Q 2006 cash flow from operations $11.8 million 11 Pegasystems 2006

12 Pegasystems Q Results Continued Business Success Product upgrade, PRPC 5.1, with user, developer and analyst enhancements Gartner MQ leadership recognition 536 Pega-certified system architects, up from 144 2Q 2005 $0.40 cash EPS 12 Pegasystems 2006

13 Pegasystems 1H 2006 Overview More implementations, larger customer base drive service revenue ~ $9 million in license signings to be recognized over term of agreement Second $10 million buyback authorization as of July 1 Quarterly cash dividend $0.03 per share as of July 3 Continued investments to support growth in service and sales 13 Pegasystems 2006

14 Pegasystems Balance Sheet Highlights As of June 30, 2006 $22 million deferred revenue compared to $15 million June 2005 $126 million cash and investments $46 million installment receivables No debt 14 Pegasystems 2006

15 BPM Today Must: Integrate: People and Systems Polices, Procedures and Data Offer: Enterprise-wide interoperability for reuse, best use and competitive advantage Provide: Optimal outcomes and operational excellence 15 Pegasystems 2006

16 Only Pegasystems Offers rules-based technology: integrate business processes support enterprise-wide interoperability drive optimal results Independently recognized BPM technology Proven success with Fortune 500 and other leading companies Strong cash generation supports growth, innovation and value to shareholders 16 Pegasystems 2006

17 Pegasystems Inc. 101 Main Street, Cambridge, MA Pegasystems 2006