BigAir Limited at Microequities 2010 Rising Stars Microcap Conference

8/9/2019 BigAir Limited at Microequities 2010 Rising Stars Microcap Conference

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www.microequities.com.au

2010 RISING STARS MICROCAP CONFERENCE

Thursday 10 of June 2010 / Level 4 Room 1/ SYDNEY HILTON (488 George St, NSW 2000)

MORNING SESSION

9:00-9:50 h. SILVER CHEF (ASX SIV) Allan English (CEO)

Charles Gregory (COO)

9:50-10:30 h. KONEKT LIMITED (ASX KKT) Serhat Oguz (CEO)

10:30-11:00 h MORNING COFFEE BREAK

11:00-11:40 h CLOVER CORPORATION (ASX CLV) Dr. Ian Brown (CEO)

11:40-12:20 h BIGAIR LIMITED (ASX BGL) Jason Ashton (Co-CEO)

12:20-13:30 h LUNCH BUFFET

AFTERNOON SESSION

13:30-14:10 h. CASH CONVERTERS INTERNATIONAL(ASX CCV)

Ralph Groom (CFO)

14:10-14:50 h. MANACCOM CORPORATION (ASX MNL) Mike Veverka (CEO)

14:50-15:20 h AFTERNOON COFEE BREAK

15:20-16:00 h PATTIES FOODS LTD (ASX PFL) Greg Bourke (CEO)

16:00-16:40 h.

XRF SCIENTIFIC LIMITED (ASX XRF) Terry Sweet (CEO)

AGENDA


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Microequities is a specialised Microcap asset manager. Established in 2005 as an independentinvestment research house devoted to Microcaps. Microequities expanded into fundsmanagement in early 2009 by launching our flagship Deep Value Microcap Fund.

Why us? Microequities' investment managers and analysts operate uniquely within the Microcapasset class. This asset class offers investors access to Australian companies with an attractivegrowth profile. However, it also necessitates a systematic and process driven research approachto investing. We are uniquely positioned within the Microcap asset class and posses research

capabilities, deep knowledge and experience within the Microcap space. Our value-growthapproach, coupled with a long term investment strategy, provides us with an investment ethosthat is particularly well suited to Microcap investing.

The Deep Value Microcap Fund: Launched in March 2009, is a high conviction, value growthFund that seeks to identify and invest in growing, profitable undervalued companies. The Funddoes not have a broad based approach to investment. It maintains concentrated holdings in whatwe consider the most compelling companies within the Microcap asset class with the mostattractive risk/reward metrics. The fund has returned 83% since inception (net of fees) comparedto 43.12% for the All Ords Index.

Carlos Gil (CIO) / [email protected] / +61 2 9231 6169

Fortbridge Consulting is a media and investor relations firm representing publicly listedcompanies. Fortbridge works with their clients to build corporate reputation and promote value.

Fortbridge investor communications programs target a range of stakeholders, includingshareholders, institutional investors and funds, as well as the financial media, in the markets inwhich their clients operate.

With access to up-to-date research and investor contact information for financial centers aroundthe world, Fortbridge is able to research and maintain meaningful sector specific investor lists fortheir clients. Using this information, Fortbridge target relevant institutional investors and funds toengage their support for their clients IPOs , institutional placements, capital raisings, SPPs oron-market trades.

Fortbridge consultants in Sydney, Perth, London Toronto and Santiago have a track-record inworking with clients to build shareholders value and to grow business; to communicate the valueof new developments and to manage significant issues that impact reputation.

Bill Kemmery (Managing Director) / [email protected] / +61 2 9331 0655

EVENT ORGANISER

EVENT SPONSOR

2010 RISING STARS MICROCAP CONFERENCE

PROFILES
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]


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2010 Rising StarsMicrocap Conference

ASX: BGLPresented by Jason Ashton (CoCEO)

SYDNEY HILTON, 10 June 2010

Agenda

BigAir at a Glance

Key Highlights

Financial Results

Operational Overview

Strategy and Business Outlook

Q&A


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BigAir At A Glance

Total addressable market size est. >$1b

Current half year revenue run rate of $6.7m

Market Growth Opportunity

Track Record of Organic Revenue and Profit growth

Clear Leader in the Market

Industry Leading Margins

Over 15,000 square kilometres network coverage

Largest infrastructure based Fixed Wireless business

40% half year revenue growth in Fixed Wireless

122% increase in half year NPAT

80% Gross Margin

Strong Management and Board

Solid Balance Sheet

43 EBITDA Marg n

Experienced Telco industry board and management

Recently appointed new National Sales Manager

No debt and cash of $2.1m

Net Tangible Assets increased by 61% to 5c/share

Exceptional Financial Performance

Key highlights and achievements

Onnet Revenue up 40% to $3.3m

EBITDA up 68% to $1.45m

After Tax Profit up 122% to $625k

Continued Multi State Network Expansion

Increased coverage and capacity in Victoria, South East Queensland and Perth

Over $1m in capital investment fully funded from internally generated free cash flow

Focused on Organic Revenue Growth

Revenue base is diversifying with new sales outside NSW now accounting for 60%

Half year on net revenues increased by approx $1m to $3.3m from previous corresponding period

Increased investment in Sales & Marketing with new experienced National Sales Manager


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Key Financials

Half-year Half-year Movementended ended

31-Dec-09 31-Dec-08$ $ $

Fixed "On-net" Revenue 40% 3,295,048 2,360,502 934,546

Mobile "Off-net Revenue -95% 71,745 1,322,788 (1,251,043)

Total Revenue - 9% 3,366, 793 3,683,290 (316,497)

Cost of Sales -52% 702,319 1,474,564 (772,245)

Gross Profit 21% 2,664,474 2,208,726 455,748

Gross Profit Margin (% Revenue) 32% 79% 60% 19%

Other income 140% 31,645 13,204 18,441

Operating Expenses - 8% 1,247, 374 1,359,312 (111,938)

EBITDA 68% 1,448,745 862,618 586,127

EBITDA (as % Revenue) 43% 23%

Net Profit Before Tax 108% 865,210 416,098 449,112

Net Profit After Tax 122% 625,000 281,670 343,330

NPAT (as % Revenue) 143% 19% 8%

Earnings per share 118% 0.7 0.3 0.4

Net Tangible Assets per Share (cents) 61% 5.0 3.1 1.9

Financial Cash Flow

Aggressive capital investment to increase network capacity and coverage

Cash Flow Half-year Half-year Movementended ended

31-Dec-09 31-Dec-08

Net cash flow from operating activities 39% 1,206,921 870,801 336,120

Net cash flow used in investing activities 90% (1,152,041) (606,174) (545,867)

Net cash flow from investing activities - - - -

Net movement in cash -79% 54,880 264,627 (209,747)

Operating cash flow improved by $336k from the previous corresponding period

Aggressive Capital Investment of $1.1m for 1H fully funded from operating cash flows

Balance of cash at year-end 9% 2,101,255 1,926,872 174,383


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Financial Opex

Strong Onnet Revenue growth while containing costs

Operating Expenses Comparison Half-year Half-year Movementended ended

31-Dec-09 31-Dec-08$ $ $

Employee benefits expense 9% (847,848) (777,111) 70,737

Sales and marketing expense 11% (127,774) (115,614) 12,160

General administration expense - 49 % ( 20 1,3 42) (3 94, 931) ( 19 3,58 9)

Occupancy costs -2% (70,410) (71,656) (1,246)

Tota lO era tin Ex enses -8 % 1 ,24 7,3 74) 1, 359, 312 ) 111,9 38)

Due to increased scale and efficiency gains and despite increased investment in sales and

marketing expenses the overall operating expense decreased by 8%

Significant reduction in general admin expenses due to the closing of the iBurst business

, , , , ,

Sequential Half Year EBITDA Trend

Strong Profit Growth

200

400

600

800 1,000

1,200

1,400

1,600

$ 0 0 0

(600)

(400)

(200)

1H07 2H07 1H08 2H08 1H09 2H09 1H106 Mnt EBITDA (535) (449) 116 704 849 1,287 1,449


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Strong Underlying Revenue Growth

Balance sheet is strong, with zero debt

1H09 1H10$ $

Current AssetsCash and cash e uivalents

As at 30 June 1H09 1H10$ $

Current liabilitiesTrade and other a ables 1 458 367 967 776

As at 30 June

, , , ,Trade and other receivables 145,489 204,660Inventories 3,091 2,245Other 18,286 51,960Total current Assets 2,093,738 2,360,120

Non-current assetsOther financial assets - -Trade and o ther receivables 39,372 37,277Property, plant and equipment 1,994,502 3,095,228Def er re d ta x as set s 1 ,7 42, 788 1 ,38 1,1 49Goodwill -Ot he r i nt angi bl e ass ets 1 42, 566 16 8, 951Total non-current Assets 3,919,228 4,682,605

, , ,Income received in advance 44,480 37,738Provisions 96,354Total current liabilities 1,502,847 1,101,868Total liabilities 1,502,847 1,138,868

Net assets 4,510,119 5,903,857

EquityIssued capital 10,578,051 10,614,801Reserves 161,237 161,237Accumulated losses (6,229,169) (4,872,181)

Net Tangible Assets /share 5.0 cents 3.1 cents

Zero Debt with more than $2.1m in cash

Net Assets have increased to $5.9 million

NTAincreased from 3.1 cents to 5.0 cents per share

No goodwill currently on palance sheet with minimal intangible assets

Total Assets 6,012,966 7,042,725Half Year Earning /share 0.72 cents 0.33 cents


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Operational OverviewDiversification of revenue base monthly sales from deployments in other states now surpasses NSW

contribution to the Group for new Revenue. Deployments outside NSW have increased their total

Operational Overview

share of Revenue from 18% to 30% over the last 12 months.

Improved back office efficiency accounts receivable outstanding days have decreased from 15 to 13

days, and the average credit days for suppliers is also down from 61 days to 48 days.

Continued improvement in gross margin due to improving economies of scale BigAirs gross margin

has continued to improve, up to 79% from 73% in previous year.


A ressive network ex ansion

We intend to retain our position as the No.1 fixed wireless operator in terms of coverage and capability and we

intend to continue to expand our network to all major cities across the country.

Tapping into New Markets with flexible data offerings

Recent power grid failures and fixed network outages have highlighted the need for business to implement

networ s w t some carr er an n rastructure vers ty. B gA r s aggress ve y target ng t s grow ng mar et w t

its wireless Backup and Disaster Recovery services.

BigAir is also targeting the high speed short term service market having recently signed up a high profile ASX100

construction company with a multi site contract.


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Clear leader in Fixed Wireless with stron focus on wholesale markets

With our rapidly increasing network coverage and growing customer base BigAir is emerging as the clear leader

in the fixed wireless data market.

BigAir has recently appointed Mr. Donald Sutherland as National Sales Manager. With a strong track record in

telecommunications over 20 years including spending the last four years at TPG/Soul his industry experience will

be an asset to the group.

combination of fast and flexible data plans, unmatched coverage and reliable service.


Acquisition of Wizz Communications

Synergies/Benefits

Im act on BGL

Acquisition Summary

6 additional Base Stations in Sydney, Melbourne and Brisbane

New wholesale channel partnersAdditional resources and skills in

high end licensed microwave market

Greater depth of product and servicesGreater scale of economiesIncrease expertises and resourceComplementary channel partners

Consideration

Total consideration of $1.4m (cash & scrip)

Approx 2.8 x EBITDA contribution Part deferred cash & scrip

payment

Annual revenue contribution of $1m

$500k EBITDA contribution for the first 12 months

Network integration completed ahead of

schedule


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Business Outlook and Guidance

Despite the closure of the iBurst business which contributed $1.5m Revenue and $0.5m Gross Profit contribution in

the previous financial year (FY2009) we are expecting to deliver higher Total Revenue and Gross Profit in FY2010.

The Group has reported $300k monthly EBITDA in April 2010 and provided revised market guidance of $3.0m

EBITDA for the full financial year 2010.

FY2009 FY2009 FY2009 FY2010 1H2010 FY2010Initial Guidance Initia l Guidance

Guidance Updatec ua

Guidancec ua

UpdateEBITDA $1.5m $1.8-$2.0m $2.14m $2.5-$2.8m $1.45m $3.0m

Share Price Summary & Key Ratios

ASX:BGL*

Total shares outstanding: 88.5 million52 week range: $0.22 $0.05

Price: $0.165VWAP 30 days: $0.179VWAP 60 days: $0.192Market Cap: $14.6mEV/EBITDA multiple FY 2010 **: 4.2

*All price calculation based on share price as of 25/5/2010** Based on revised EBITDA forecast of $3m for FY2010 and using net debt figure as of 31 Dec 2009.


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Q&A

OUR NETWORKS, YOUR BUSINESS

Disclaimer

This presentation contains forward looking statements that involve risks and uncertainties.

These forward looking statements are not guarantees of BigAir's future performance and involve a number of risks and uncertainties that may cause actual results to differ materially from the results discussed in these statements.

This presentation only contains information required for a preliminary evaluation of the Company and in particular only discloses information by way of summary within the knowledge of the Company and its Directors. An investor should seek its own independent professional advice in relation to the technical, financial, taxation, legal and commercial matters relating to any investment in BigAir Group Limited.

Other than to the extent required by law (and only to that extent) the Company and its officers, employees and professional advisers make no representation, guarantee or warranty (expressed or implied) as to, and assume no responsibility or liability for, the contents of this presentation.

BigAir Limited at Microequities 2010 Rising Stars Microcap Conference

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