IKE 1H FY18 Results Presentation

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MEASURING UP 1H FY18 RESULTS & COMMENTARY
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1H FY18 Results & Commentary

IMPORTANT NOTICE
This presentation is given on behalf of ike
GPS
Group Limited (Company Number NZ 1292732, NZX & ASX:IKE)
Information in this Presentation:
•is for general information purposes only, and is not an
offer or invitation for subscription, purchase, or
recommendation of securities in ikeGPS Limited;
•should be read in conjunction with, and is subject to,
ike’s1H FY18 financial statements, market releases,
and information published on ike’s website
(www.ikegps.com);
•includes forward-looking statements about ike and the
environment in which ike operates, which are subject
to uncertainties and contingencies outside
of ike’s control –ike’s actual results or performance
may differ materially from these statements;
•includes statements relating to past performance,
which should not be regarded as a reliable indicator of
future performance; and
•may contain information from third parties believed
to be reliable –however, no representations or
warranties are made as to the accuracy or
completeness of such information.
All information in this presentation is current at the
date of this presentation, unless otherwise stated.
All currency amounts are in NZ dollars unless
stated otherwise.
Receipt of this Document and/or attendance at this
presentation constitutes acceptance of the terms
set out above in this Important Notice.
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1H FY18 summary. Improvement across all key metrics.
-Revenue in the period of $3.5m
-75% higher than prior calendar period (PCP) of $2.0m
-Net loss in the period of $3.9m
-35% improvement against PCP loss of $6.0m
-Operating cash used in the period of $2.6m
-48% improvement against PCP of $5.0m
-Record unit volume sales of the IKE product, the largest contributor to overall IKE revenue and gross margin, into the
electric utility and communications market:
-186 IKE systems shipped 1H FY18
-94% higher than PCP of 96 systems.
-Record 116 IKE systems shipped in Q2.
-Q3 expected to be stronger again based on orders on-hand from target account wins.
-Total orders received YTD of approximately 305 systems.
-Subscription framework is in place for IKE4, meaning lower recognisedrevenue at the time of sale but
approximately 50% greater revenue overall as against the predecessor IKE3 product.
-Original full year FY18 guidance was for 300 systems and greater than 40% YoY growth. This has been upgraded
by approximately $1m to greater than 360 systems and greater than 70% YoY growth.

1H FY18 summary. Improvementacrossall key metrics cont.
-Spike sales, primarily into the Signage market, were steady in Q2 FY18 against Q1 FY18
-1,251 total units shipped 1H FY18.
-Full year guidance for 3,000 units and greater than 50% YoY growth.
-New solution partners for the AEC market (Autodesk) and Geospatial market (Esri) in place to expand the verticals
that Spike can address 2H and forward.
-7,500 Stanley Smart Measure Pro units shipped 1H FY18 into the European and Australian markets
-Approximately1,000 additional units expected to ship November 2017.
-New ‘IKE Analyze’ product launched and delivered.
-Revenue run rate for IKE Analyze has grown to approximately $1m p. a.
-Cash breakeven target expected to be met in FY18 based on orders received YTD and current sales run rate.

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Strongest growth in the operating segment that delivers
the highest margin and recurring revenue.
1H FY20181H FY2017
$'000’s$'000’s
Utilities2,202861
New Business1,2491,110
Total Operating Revenue3,4511,971
> 155% growth
against PCP in
highest gross
margin segment

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Record IKE unit volume sales Q1 and Q2.
Stronger performance expected again in Q3.
.
0
50
100
150
200
1H FY172H FY171H FY18
Momentum in the electric utility and
communications market
Unit volume
•Q1 FY18 record with 70
IKE units sold.
•Q2 FY18 record with116
IKE units sold.
•Q3 FY18 expected to be
stronger again based on
orders on-hand.

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Group operating results & net assets
1H FY20181H FY2017
$'000’s$'000’s
Total operating revenue & government grants3,4511,970
Net loss before other comprehensive income(3,891)(6,006)
Net assets10,80410,636
85% growth
against PCP.

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Improving cashflow. On track to targeted breakeven.
Cash usage almost
halved against
PCP.

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Solid progress against KPI’s.
.
MetricExpectation at commencement of FY20181H update
Customer and
market growth
Greater than 40% growth in IKE new unit sales against FY17,
with additive revenue from existing IKE4 customers
converting 2
nd
year cloud subscriptions.
Greater than 50% growth in Spike new units sales against
FY17, with additive revenue from new cloud subscriptions.
Upgraded. To greater than 70% YoY growth, or 360
units. Orders for 305 units received YTD
On track. 2H achievement relies on new enterprise
deals in the Geospatial and AEC markets.
CashTransition to cash breakevenin FY18.On track, expecting higher revenue and lower opex
against PCP.
Gross margins,
EBITDA,pricing &
business models
Gross margins on IKE-branded products improving by up to
5% margin points over FY17 actual of 69%.
EBITDA to improve significantly against FY17.
IKE4 and Spike higher bias to recurring revenue via cloud s/w.
On track. Full year FY18 outturn impacted by volume
pricing on large enterprise IKE4 deal and non-cash items.
On track.
On track.
Operating
expenditure
Operating costs will decrease in absolute dollar terms against
FY17.
Sales and marketing costs will be at a similar level to FY17 and
engineering and corporate costs will decrease.
On track: 1H opexc 28% or c $2m lower than PCP.
On track/implemented.

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Solid progress with IKE4 target accounts.
Having required patient account management.
Update on example Target Accounts: with revenue and cash primarily impacting 2H FY18
A first phase order of 112 systems into one of the largest global communications & fiber companies.
-Recognisedrevenue from this initial deployment will be approximately $1.3m in FY18 with ongoing recurring revenue of
approximately $400k per annum, plus any associated services revenue.
A approximately $0.6m sale into an investor-owned utility in California.
-The IKE4 platform is now in all investor-owned utilities in the State’s of California and Washington.
-The west coast of the U.S. was the initial target for IKE’s sales team. This is the second group to scale a deployment to
greater than $0.5m.
A third phase order of 15 IKE4 systems, for approximately $180k, from an engineering services company.
-This customer has grown to have more than 50 IKE systems deployed, having added 30 IKE4 systems YTD in FY18.
-Associated subscription revenue from this customer expected to be approximately $0.45m over the next 36 months.
>3,200
U.S. Electric Utilities
>1,000
U.S. Engineering Firms
>500
U.S. Communications Firms
>400
U.S. customers using the IKE3
or IKE4 platform every day to measure
and manage their pole data
Many thousands of new pole records are being
added, analysed and managed in the IKE Cloud,
every day.
>15
Target accounts engaged around
the IKE4 platform with the potential
to grow to more than $1m revenue

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Solid progress with Investor-Owned Utilities on the West Coast.
The initial geographical sales focus for IKE. Today, all IoU’sin CA and WA are customers.
Opportunities in new US geographies emerging

A closer look at the opportunity for IKE
within the U.S. fiber market.
Markettailwinds supporting the growth of the IKE4 solution for capturing, analyzing
and managing distribution asset information.

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$300B to be invested in building competing fibernetworks.
The majority of this network deployment is to be on overhead infrastructure.

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The IKE solution dramatically speeds engineering & cuts costs.
2x faster field engineering per pole and 5x faster make-ready-engineering processes.
Snapshot of actual customer ROI data from a recent IKE4 pilot
program at the world’s largest communications company.
Minutes/pole:
field engineering
(incumbent)
Minutes/pole:
field engineering
(IKE)
Minutes/pole:
Digital design and
MRE engineering
(incumbent)
Minutes/pole:
Digital design and
MRE engineering
(IKE)

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Positioned in front of the major players.
Potential for larger volume, multi-year sales programmes.
As an example, the fiber
customer relating tothe
recently announced
IKE4 win has:
10m poles
400 regional
engineering offices,
and
>200 engineering
firms contracting to it
around pole services.

Appendices

Appendix 1
A closer look at the new IKE4
product, IKE Analyze.

Introducing IKE Analyze.
j
A new standalone product for electric utilities and communications companies.
Run rate sales at $1m p.a. following Q2 launch. Near term growth opportunities.
The old way
IKE
Analyze
IKE Analyze
Cloud
1. Collect poles in
the field
2. Input and process
pole data
3. Convertdata to Pole Load
Analysis or Make Ready
Engineering analysis
4. Common output such as
Pole Load Analysis
= customer resource
= IKE resource
IKE Analyze
Capability development via machine learning and Artificial Intelligence.........
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IKE Analyze explained.
h
launched and sold in 1H.
1. A customer takes photos of assets in the
field, and uploads the photos to the IKE Cloud
2. IKE Analyze dimensions the asset
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IKE Analyze explained cont.
i
launched and sold in 1H.
3. IKE Analyze reports on the asset.
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The IKE Cloud is managing more & more pole asset records.
Ingesting and processing thousands of new pole records every day, and growing exponentially.
More than 1m assets are expected to be IKE’din the coming 12 months.
Unique opportunity to develop machine learning and AI capability specific to analyzing & modeling poles.
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Appendix 2
Mobile products: a closer look at new
products and market development

Growing Spike proof points across targeted industries.
>5,000 Sign & Graphics businesses.
Using Spike everyday for estimates, quotes
and design. TAM of 150k businesses
Tens of thousands contractors
and construction groups via the
Stanley Smart Measure Pro
Insurance. First insurance customer has
grown to have 120 Spike users.
Local government andcity
councils for asset management.
Hundreds of Real Estate and
Appraisal companies.
Law Enforcement, for
accident investigation.
Defense and intel agencies, such
as the Defense Intelligence
Agency and Special Forces
Transportation. >40% of U.S. State
Department of Transportation.
Driving to Esrimobile integration.
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Introduced Spike-for-ArcGIS.
.....Carbon County, Utah realize >500% ROI in a month with Spike-for-Collector (by Esri).
“What used to take five weeks to inventory 1,500 signage, with Spike-for-Collector we were able to collect 322 signs/day or 1,620 signs/week.
This reduced our overall cost from $50,000 to $5,000 -a staggering 568% ROI”. Carbon County Head of GIS.
Esri’sArcGIS is used by 350,000 enterprise customers, including most national governments.
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Introduced scaled and perspective-corrected images.
...straight from Spike to AutoCAD, for design processes in the AEC market.
“Today over 200 million customers use Autodesk® software. AutoCAD is their flagship software product for 2D and
3D design, and is used by more AEC professionals globally than any other CAD package.”
IKE is initially targeting the >25,000 architecture companies in the U.S. market.
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Introduced Spike-for-uniVERSE.
Joining forces with the largest
smartphone protection and
case-maker in the U.S.,
OtterBoxInc.
The Spike-for-uniVERSE
bundle provides an enhanced
out-of-box user experience
and a higher sales ASP &
margin profile for IKE.
...hardware integration, bundling and co-marketing with OtterBoxInc.
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