GXS Company Presentation

Transcription

1 GXS Company Presentation Barclays 2010 High Yield Bond and Syndicated Loan Conference March 25 th, 2010 Bob Segert, President & CEO

2 Forward Looking Statements CERTAIN FORWARD-LOOKING STATEMENTS: The information set forth in the presentation materials, as well as statements made by representatives of the Company during the course of the presentation, include forwardlooking statements as defined in the Private Securities Litigation Reform Act of All statements, other than statements of historical facts, made during the course of the presentation, that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. These forward-looking statements are affected by risks, uncertainties and assumptions. Accordingly, actual results or outcomes may differ materially from those expressed in the forward-looking statements. You should not place undue reliance on these statements and we undertake no obligation to update or revise any forward-looking statements to reflect events or circumstances that may arise. March 25, 2010 Slide 2

3 GXS Today Award winning B2B e-commerce company providing Managed around the world Headquartered outside of Washington DC, servicing customers in 50+ countries Approximately 30,000 customers and 2,000 B2B e-commerce professionals Large recurring revenue stream with strong cash flow generation Acquisitions to expand scale and drive growth Selected by key global partners as B2B service provider of choice March 25, 2010 Slide 3

4 What We Do On Demand Access to the Global B2B Ecosystem GXS Trading Grid : Powering the Information Supply Chain March 25, 2010 Slide 4

5 Market-Leading B2B Outsourcing GXS Managed : People, Process and Technology Intra-Enterprise Inter-Enterprise 250+ Customers use GXS Managed Today and New Customer Signings are up 60% Year over Year March 25, 2010 Slide 5

6 Business Overview GXS and Solutions LTM 9/30/09 Revenue Messaging Managed Data Synchronization B2B Software & Custom Outsourcing Electronic network for real time exchange of electronic documents and data between business partners around the world through the GXS Trading Grid Outsourced management of customers B2B integration infrastructure, including onboarding of trading partners and mapping / translation services Tools and services that enhance customers abilities to exchange data with trading partners and manage data more efficiency within their enterprise Software and services that allow customers to effectively manage their day-to-day supply chain activities internally Custom software and messaging solutions, which consist of applications and products developed to address specific customer needs Data Synchronization Custom 4.3% Outsourcing 6.6% Managed 22.5% B2B Software & 4.7% Messaging 61.9% LTM 9/30/09 Total Revenue: $346.7mm March 25, 2010 Slide 6

7 Diversified Customer Base Retail CPG Auto & Transport Hi Tech Financial March 25, 2010 Slide 7

8 Recognized Industry Leadership GXS is still by far the leading provider of integration services, as measured by integration service revenue, international reach and customer base. Source: Gartner Research Note G , Magic Quadrant for Integration Service Providers, 20 November 2009 GXS has a strong focus on providing complete managed services for B2B integration Source: Forrester, The Forrester Wave: B2B Service Providers, Q4 2009, October 2009 March 25, 2010 Slide 8

9 Leading Retailer Case Study B2B e-commerce Outsourcing Back Office (A/P, Purchasing) Purchase Orders Order Confirmations Banks Distribution Centers Ship Notices Credit & Debit Notes Retail Storefronts Category Sales Data Recalls & Returns Market Intel e-commerce Strategy Consolidate multiple VANs and data exchange systems to GXS Offer broad range of options to suppliers of all sizes and locations Seek a low-touch, black box outsourcing approach Redeploy resources to reporting, exceptions and new projects Local Suppliers AS2 Internet EDI Tradacoms International Suppliers Flat File EDIFACT Third Party Logistics Supply Chain Benefits Real time transmission of information enabling vendor managed inventory Trading partner community changing resulting from expanded product mix and low-cost country sourcing Automating electronic business processes to enable warehouse crossdocking; direct-from-supplier shipments March 25, 2010 Slide 9

10 Global Financial Case Study Transaction Corporate Accounts Payable Corporate Accounts Receivable Payables ACH & Wire Transfer Positive Pay & Fraud Account Reconciliation Receivables Wholesale & Retail Lockbox Cash Concentration ACH & Wire Transfer Goal was to increase competitiveness of corporate cash management services through service delivery excellence Increased flexibility for security, networking and file formats Accelerated new client implementation time frames Lowered implementation costs Supported 300+ projects in Asia, Americas and Europe Expanded into securities and trade finance services March 25, 2010 Slide 10

11 Driving a New Growth Engine: Managed Managed Revenue Growth Strong New Business Pipeline ($mm) ($mm) Managed Pipeline by Quarter $80 $60 $40 $34 $43 $59 $72 $500 $400 $300 $200 $100 $0 $341 $411 $ Q Q Q3 Sampling of customers: $20 $ Contract signings up 92% year over year (1) 1) YTD 9/30/09 compared to YTD 9/30/08. March 25, 2010 Slide 11

12 Inovis Merger GXS and Inovis announced on December 8, 2009 an intention to merge companies Industry transforming merger Combines industry leaders with rich histories in B2B electronic commerce Creates the industry s premier provider dedicated to B2B with the broadest and deepest portfolio of capabilities. Customers expected to benefit from decreased B2B integration costs and improvements in performance, transaction visibility and process control. Strong ownership and financial backing continues Francisco Partners, Golden Gate Capital, Cerberus, and Norwest Venture Partners Established 1967 as a division of the General Electric Company Approximately 30,000 customers in 50+ countries Established 1983 as Harbinger Over 16,000 customers in 50+ countries March 25, 2010 Slide 12

13 Cost Savings Analysis First 12 Months Savings Areas Commentary G&A Sales and Marketing Significant executive and administrative headcount reductions Redundant internal IT systems and services Overlapping financial and legal services including auditors, insurance, etc. Reduction of combined sales force and commission savings Cost savings through reduction of combined marketing headcount Reduction in discretionary S&M spend including marketing materials and travel expense Operations and Engineering Client & Professional Data Center savings through headcount reduction, third party applications, rent and other services Transaction Engine savings from platform migrations and reduction of combined headcount Software engineering savings through elimination of redundant headcount and globalization Headcount reduction and off-shoring Elimination of duplicative third party professional and client support spend Total Cost Savings $27MM of net run-rate cost savings within the first 12 months after merger March 25, 2010 Slide 13

14 Pro Forma Capitalization Pro Forma 9/30/09 LTM Capitalization As of September 30, 2009 Pro Forma Pro Forma ($ in Millions) GXS Combined Cash and Cash Equivalents $45.1 $49.6 Restricted Cash Revolving Credit Facility - - GXS First Lien Term Loan - - GXS Second Lien Term Loan - - New Senior Secured Notes Total Debt $785.0 $785.0 Adjusted EBITDA (1) $119.0 $192.1 (2) Net Secured Debt / Adjusted EBITDA 4.3x 3.8x (1) Adjusted EBITDA is a non-gaap measure (2) Adjusted for net cost savings, restructuring, one time fees and related charges March 25, 2010 Slide 14

15 Pro Forma Combined Financial Performance Pro Forma Financial Performance ($ in Millions) PF LTM 9/30/2009 GXS Revenue $346.7 Inovis Revenue Total Revenues $484.7 EBITDA $146.8 % margin 30.3% Adjusted EBITDA (1) $192.1 % margin 39.6% Net Secured Debt / Adjusted EBITDA 3.8x Adjusted EBITDA / Cash Interest Expense 2.3x (2) (1) Adjusted EBITDA is a non-gaap measure (2) Adjusted for net cost savings, restructuring, one time fees and related charges March 25, 2010 Slide 15

16 Summary Highlights Highly Experienced in B2B ecommerce Leading Industry Position Robust Technology Platform Recurring Revenue Base and Strong Free Cash Flow Diversified Business Mix Scalable Global Infrastructure and Domain Expertise March 25, 2010 Slide 16

17 Questions Bob Segert President & CEO Work North America gxs.com EMEA gxs.eu ASPAC gxs.asia.com March 25, 2010 Slide 17