ANAPLAN, INC.

PLAN
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Anaplan : Presentation

02/27/2020 | 12:23pm

Q4 FY2020 Earnings Conference Call

February 27, 2020

Cautionary Note Regarding Forward-Looking Statements

This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, each as amended, including all statements other than statements of historical fact contained in this document and, in particular, statements about the company's growth, plans, strategies and prospects, estimates regarding the value of the company's platform to its customers, estimates of enterprise cloud-market growth, market demand, competitive position, current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, short- and long-term business operations and objectives, and financial needs. These statements identify prospective information and may include words such as "expects," "intends," "continue," "plans," "anticipates," "believes," "estimates," "predicts," "projects," "potential," "should," "may," "will," or the negative version of these words, variations of these words and comparable terminology. These forward-looking statements are based on information available to the company as of the date of this document and are based on management's current views and assumptions. These forward-looking statements are conditioned upon and also involve a number of known and unknown risks, uncertainties, and other factors that could cause actual results, performance or events to differ materially from those anticipated by these forward-looking statements. Such risks, uncertainties, and other factors may be beyond the company's control and may pose a risk to the company's operating and financial condition. Such risks and uncertainties include, but are not limited to: we have a limited history of operating at our current scale and under our current strategy, which makes it difficult to predict our future operating results, and we may not achieve our expected operating results in the future; we have a history of net losses, we anticipate increasing our operating expenses in the future, and we do not expect to be profitable for the foreseeable future; our quarterly results may fluctuate significantly and may not fully reflect the underlying performance of our business; because we derive substantially all of our revenue from a single software platform, failure of Connected Planning solutions in general and/or our platform in particular to satisfy customer demands or to achieve increased market acceptance would adversely affect our business, results of operations, financial condition, and growth prospects; if we are unable to attract new customers, both domestically and internationally, the growth of our revenue will be adversely affected and our business may be harmed; our business depends substantially on our customers renewing their subscriptions and expanding their use of our platform and failure to achieve renewals and expansions may result in a material adverse effect on our business operations and financial condition; the markets in which we participate are intensely competitive, and if we do not compete effectively, our business and operating results could be adversely affected; if we experience a security incident, our platform may be perceived as not being secure, our reputation may be harmed, customers may reduce the use of or stop using our platform, we may incur significant liabilities, and our business could be materially adversely affected; real or perceived errors, failures, bugs, service outages, or disruptions in our platform could adversely affect our reputation and harm our business; we have experienced rapid growth in recent periods and expect to continue to invest in our growth for the foreseeable future, and if we fail to manage our growth effectively, we may be unable to execute our business plan, maintain high levels of service, or adequately address competitive challenges; we could incur substantial costs in protecting or defending our intellectual property rights, and any failure to protect our intellectual property rights could impair our ability to protect our proprietary technology and our brand; our global operations and sales to customers outside the United States or with international operations subject us to risks inherent in international operations that can harm our business, results of operations, and financial condition; the uncertainty in and volatility of the broader stock market generally or the stock price of our common stock specifically may result in stockholders not being able to resell their shares at or above the price at which they purchased shares; and we may engage in acquisitions and strategic transactions that do not yield the expected results. Information concerning risks, uncertainties and other factors that could cause results to differ materially from the expectations described in this document is contained in the company's filings with the U.S. Securities and Exchange Commission ("SEC"), including its quarterly report on Form 10-Q filed with the SEC on December 9, 2019, the "Risk Factors" section of which is incorporated into this document by reference, and other documents the company may file with or furnish to the SEC from time to time. These forward-looking statements should not be relied upon as representing the company's views as of any subsequent date and the company undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date they were made.

Copyright © Anaplan Inc., 2018

2

Use of Non-GAAP Financial Measures

In addition to financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), this document and the accompanying tables contain non-GAAP financial measures, including non-GAAP sales and marketing expense, non-GAAP research and development expense, non-GAAP general and administrative expense, non-GAAP loss from operations, non-GAAP operating margin, non-GAAP net loss, non-GAAP net loss per share, and free cash flow. The non-GAAP financial information is presented for supplemental informational purposes only, and is not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. The non-GAAP measures presented here may be different from similarly-titlednon-GAAP measures used by other companies.

We use these non-GAAP measures in conjunction with GAAP measures as part of our overall assessment of our performance, including the preparation of our annual operating budget and quarterly forecasts, to evaluate the effectiveness of our business strategies and to communicate with our board of directors concerning our financial performance. We believe these non-GAAP measures, when viewed collectively with the GAAP measures, may be helpful to investors because they provide consistency and comparability with our past financial performance and facilitate period-to-period comparisons of our operating results.

There are material limitations associated with the use of non-GAAP financial measures since they exclude significant expenses and income that are required by GAAP to be recorded in our financial statements. The definitions of our non-GAAP measures may differ from the definitions used by other companies and therefore comparability may be limited. In addition, other companies may utilize metrics that are not similar to ours. We compensate for these limitations by analyzing current and future results on a GAAP basis as well as a non-GAAP basis and by providing specific information regarding the GAAP items excluded from these non-GAAP financial measures. Please see the reconciliation tables at the end of this document for the reconciliation of GAAP and non-GAAP results.

Copyright © Anaplan Inc., 2018

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Financial Highlights

Q4 Fiscal Year 2020

Revenue $98.2M, up 42% YoY

GAAP Operating Margin (38.3%)

Billings $126.5M, up 25% YoY

Non-GAAP Operating Margin (11.2%)

Remaining Performance Obligation (RPO) $656M, up 49% YoY

GAAP Net Loss per Share $0.27

Dollar-based Net Expansion Rate (NRR) 122%

Non-GAAP Net Loss per Share was $0.07

Customers with ARR >$250K, up 42% YoY

Non-GAAP Free Cash Flow ($6.1M)

Copyright © Anaplan Inc., 2018

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Strong, Consistent Subscription Growth

ANNUAL SUBSCRIPTION REVENUE $M

+48%

+45%

+57%

QUARTERLY SUBSCRIPTION REVENUE $M

KEY

Subscription Revenue

Y/Y Growth Rates

42

308

209

144

91

54 6065

74 80

90

FY'17

FY'18

FY'19

FY'20

Q3'19

Q4'19

Q1'20

Q2'20

Q3'20

Q4'20

Y/Y

42%

44%

45%

48%

47%

50%

Copyright © Anaplan Inc., 2018

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Capturing a Greater Share of Wallet

CUSTOMERS WITH >$250K ARR GROWING STEADILY

DOLLAR-BASED NET EXPANSION RATE

353

181

248

123%

123%

122%

122%

113

FY'17

FY'18

FY'19

FY'20

FY'17

FY'18

FY'19

FY'20

Net Expansion Rate ("NRR") is calculated as the ARR at the end of a period for the base set of customers from which we had ARR in the year prior to the calculation, divided by the ARR one year prior to the date of calculation for that same customer base.

Copyright © Anaplan Inc., 2018

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Annual and Quarterly Remaining Performance Obligation

ANNUAL RPO $M

QUARTERLY RPO $M

+49%

+44%

KEY

Remaining Performance Obligation

Y/Y Growth Rates

656

440

590

656

305

440

473

516

381

FY'18

FY'19

FY'20

Q3'19

Q4'19

Q1'20

Q2'20

Q3'20

Q4'20

Y/Y

40%

44%

53%

56%

55%

49%

Copyright © Anaplan Inc., 2018

7

Annual and Quarterly Billings

ANNUAL BILLINGS $MQUARTERLY BILLINGS $M

+44%

KEY

+42%

Calculated Billings

Y/Y Growth

Rates

+41%

417

290

114

126

204

101

87

89

72

144

FY'17

FY'18

FY'19

FY'20

Q3'19

Q4'19

Q1'20

Q2'20

Q3'20

Q4'20

Y/Y

43%

54%

57%

46%

59%

25%

Note: Calculated Billings is defined as revenue plus the change in deferred revenue.

Copyright © Anaplan Inc., 2018

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Non-GAAP Gross Margin

GROSS MARGIN BY YEAR

90%

86%

117

84%

83%

68%

70%

73%

76%

8180

263

175

117

81

FY'17

FY'18

FY'19

FY'20

KEY

Total Gross

Subscription

Total Gross

Non-GAAP

Profit

Gross Margin %

Margin %

Copyright © Anaplan Inc., 2018

GROSS MARGIN BY QUARTER

83%

83%

84%

84%

85%

84%

73%

72%

73%

75%

76%

77%

63

68

76

55

50

45

Q3'19

Q4'19

Q1'20

Q2'20

Q3'20

Q4'20

Non-GAAP gross margin calculated as gross profit, excluding the effect of stock-based compensation expense, employer payroll tax expense related to employee stock plans,and amortization of acquired intangibles, as a percentage of revenue. See appendix for a reconciliation of non-GAAP gross margin to GAAP gross margin.

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Non-GAAP Operating Expense and Free Cash Flow Margins

OPERATING EXPENSE AS A % OF REVENUE

KEY

S&M

R&D

G&A

104%

95%

92%

92%

319

249

53

154

44

114

210

27

161

20

97

71

45

56

23

30

FY'17

FY'18

FY'19

FY'20

FREE CASH FLOW $M AND AS PERCENTAGE OF REVENUE

FY'17

FY'18

FY'19

FY'20

-31

-30

-29

-68

(8%)

(26%)

(18%)

(28%)

KEY

Free Cash Flow

Free Cash

Flow Margin

Note: All numbers are Non-GAAP; See appendix for a reconciliation of non-GAAP operating margin to GAAP operating margin. Free cash flow defined as net cash used in operating activities less purchase of property and equipment and capitalized internal-use software.

Copyright © Anaplan Inc., 2018

10

Thank You

Non-GAAP Reconciliation

12

Non-GAAP Reconciliation

13

Non-GAAP Reconciliation

14

Non-GAAP Reconciliation

15

Definitions

Customer Lifetime Value (LTV)

We define customer lifetime value as the increase in subscription gross profit comparing the last twelve months of subscription gross profit to the twelve months a year prior, divided by an assumed churn rate.

Customer Acquisition Cost (CAC)

We define customer acquisition cost as the last twelve months of sales and marketing expense, a year prior.

Annual Recurring Revenue (ARR)

We define annual recurring revenue as subscription revenue already booked and in backlog that will be recorded over the next 12 months, assuming any contract expiring in those 12 months is renewed and continues on its existing terms and at its prevailing rate of utilization.

Dollar-based Net Expansion Rate (NRR)

We define dollar-based net expansion rate as the ARR at the end of a period for the base set of customers from which we had ARR in the year prior to the calculation, divided by the ARR one year prior to the date of calculation for that same customer base.

Copyright © Anaplan Inc., 2018

16

Disclaimer

Anaplan Inc. published this content on 27 February 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 February 2020 13:40:04 UTC

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