netas company overview
TRANSCRIPT
-
5/22/2018 Netas company overview
1/11
Company Overview
November 2013
1
-
5/22/2018 Netas company overview
2/11
Executive Summary
Netaseeks to create the premier ICT services company in Turkey with export channels into Asia, Africa & theMiddle East
Netatoday is the combination of two businesses: Nortel Netaand Probil Nortel Netawas a carrier-grade Systems Integration (SI) company with an in-house R&D department and the ability to
complete large, complex projects in the telecom and public safety / defense segments Probil was an enterprise-grade SI business with attractive customer relationships in key verticals (telecom, finance, general
industry)
Netahas strengths and opportunities neither Nortel Netanor Probil had independently: Unique capability to manage the convergence of carrier and enterprise ICT solutions for an unmatched array of tier one
customers
Combined enterprise expertise with project management skills necessary to win large public projects
Ability to penetrate new business segmentslike SMEs - via nationwide channel partners & in-house service deliveryorganization
Access to new verticals for sizeable R&D team to create proprietary and higher-margin products
The market is taking notice of Neta strategic direction, with increasing support from suppliers and customers #1 Systems Integrator in Turkey; 21stbiggest ICT company in Turkey (Source: Interpro Bilisim 500, 2013)
Turkeys 18thfastest growing company; #1 fastest growing ICT company in Turkey (Source: Capital magazine, 2013)
Cisco Global Enterprise Partner of the Yearthe only company in Turkey awarded with this global title to date
Netahas won several major projects requiring combined carrier & IT expertise
Going forward, Neta growth strategy is based on providing vertical-specific value-added solutions in Turkeyand the surrounding region
Owned software. Netahas utilized its R&D expertise to create a messaging app and network monitoring solution forTurkcell. The company is currently working on new applications for the utilities sector, SME businesses (e.g., ERPsolutions) and public safety.
Outsourced and managed services. Netahas won service contracts to manage Wi-Fi hotspots for SuperOnline / TurkTelekom and unified communications equipment at Akbank branches.
International expansion. As the largest systems integrator in Turkey, Netais well positioned to grow in Bangladesh, CIS(including Kazakhstan), Middle East and North Africa. Neta international business has grown from almost zero in 2010 to~$20mm this year.
2
-
5/22/2018 Netas company overview
3/11
Turkish ICT market is growing rapidly to meet
ambitious 2023 national targets
19.021.6
4.0
4.6
7.0
8.5
1.1
1.4
0.7
1.0
2013E 2016E
Telco
Operators
(e.g., Turkcell
subscriberrevenues)
Carrier HW
(e.g., routers,
RAN, VoIP)
IT HW (e.g.,
tablet, laptop,
phones, WLAN,
etc.)
IT Service
IT SW
5%
5%
7%
11%
13%
CAGR
13-16E
$32bn
$38bn
Turkish ICT Market Evolution 2013E-2016E
Source: IDC March 2013, Netamanagement estimates
Rapidly growth across the Turkish
ICT market
Commentary
Highest growth in Neta addressable markets
Turkish ICT market grew at 12% CAGR 2011-2013 in TRY terms, and hit ~$30bn total
market size in 2012
Software (~10% of non-operator market) and services (~15%) expected to reach
~65% of non-operator ICT spend (matching current US / EU average share levels) in
next decade, driven by Cloud Computing, Enterprise Communications, Big Data, etc.
Main verticals today are Finance, Government, Telecom, Manufacturing, but
Utilities, Healthcare and SMEs are growing
Neta SI addressable market estimated at ~$3bn, consisting of IT SW, IT Service, ITHW (excluding direct sales of ~$5bn), Carrier HW
Growth supported by Government spending through 2023
Governments 2023 plan targets G-10 entry for Turkey, with $500bn in exports and
a $2trillion economy
ICT target market size by 2023 is ~$160bn, to be achieved by:
- Increase to ~$10bn in software exports
- Broadband subscriber growth from 20mm to 45mm, with 1GBps connectivity- Growth in R&D share of GNP from 1% to 3%
- Turkey as IT Outsourcing hub to EMEA region
- Turkish datacenters as regional / global data hubs
Source: Interpromedya Biliim 500, 2013
3
-
5/22/2018 Netas company overview
4/11
Enterprise grade product resell & solution design
Market access in financial services and general
industry clients
Service delivery (through BDH) nationwide
Probil (acquired October 2011)
Capabilities
2011 Headcount: 571
Network & Security (Cisco)
Enterprise Solutions
Outsourcing & Field Services
Microsoft licensing resale
Business segments
Partners (sample)
Carrier grade network systems integration
R&D skillset with >600 engineers
Large & complex project delivery for private
telcos, Turk Telekom, and defense
Nortel Neta(established 1967)
Capabilities
2011 Headcount: 778
Systems Integration (resale & service)
Technology (outsourced R&D, support)
Defense (R&D, manufacturing & services)
Business segments
Partners (sample)
Revenue ($mm)Revenue ($mm)
Carrier, enterprise and converged systemintegration , with unique ability to execute most
complex projects
Vertical focus for proprietary R&D and solution
design (e.g., proprietary LTE solution)
Neta
Capabilities
2012 Headcount: 1,653
Business segments
Additional Partners (sample)
Revenue ($mm)
279307
2011PF 2012A
64 103 103 99
2007 2008 2009 2010
79 119 141 137180
2006 2007 2008 2009 2010
Public (Government, Defense)
Enterprise (Finance, Telco, Utility, Healthcare,Education, SME)
International (Telco, other)
Technology
Neta R&D output:
4G LTE
Loupe (E2E msg)
Multimedia Soft Client
NetaDinamik ERP(Microsoft Navision)
Neta is now uniquely positioned to offer both
enterprise IT and networking services
Source: Neta& Probil financials, public filings, Netamanagement
+ =
4
-
5/22/2018 Netas company overview
5/11
Netahas unrivalled access to top tier customers across
key Turkish ICT verticals
Utilities
Telecom
General
Industry
International
Technology/R&D
Government &
Defense
Financial Services
5
-
5/22/2018 Netas company overview
6/11
An excellent management team carrying longstanding
customer relationships
M. Ali Tombalak
16 yrs at Probil/Neta
24 yrs in ICT
Enterprise Sales
Mujdat Altay
9 years as CEO
33 years at Neta
CEO
Ilker Caliskan
CFO
Gonul Kamali
21 yrs at Neta
Carrier
Technologies
Kamil Orman
29 yrs at Neta
Public SafetyAli Kuralkan
Photo
2 yrs at Neta
19 yrs ICT (Cisco, ALU)
International Sales
Ahmet Sukuroglu
9 yrs at Probil/Neta
14 yrs in ICT
Government
M. Necmi On
Photo
16 yrs at Probil/Neta
20 yrs in ICT
CTO
Ayse Dogrusoz
6 yrs at Neta
14 yrs in ICT
Human Resources
8 yrs at Neta
10 yrs at Deloitte
Biographical highlights
6
-
5/22/2018 Netas company overview
7/11
And support from a world-class R&D center committed to
innovation
Technology department overview
NetaR&D group was established in 1973
Netaemploys 678 engineers focused on R&D and customer support,
with >25% holding graduate degrees
469 engineers support Genband in the development of its
multimedia and VoIP communications technologies
110 engineers focused on development of public safety and defense
applications in Turkey
99 engineers dedicated to developing proprietary software for Neta
local verticals
Global R&D Center status (Center of Excellence), and winner of Turkish
Software Export Champion title three times in last five years
Value proposition to outsourced development clients is low-cost R&D
engineers with comparable productivity and English language skills vs.
European peers
Heritage of product and software development positions Netaas the
leading developer of proprietary, local solutions for its clients across
multiple verticals
Illustrative technology development
projects
4G LTE
Government contract to develop 4G LTE for Turkeysemergency communications platform; technology hasbroader uses in defense and civilian applications
Turkish SME market
Localized version of Microsoft Navision ERP system
NetaLoupe
Developed with Turkcell, Loupe is a monitoring tool forValue-Added Services in IP networks (e.g., SMS, IPTV)
Utilities Vertical
Machine-to-machine automated meter reading applicationsfor energy consumption optimization
Outsourced development projectsGenband
Long-term partnership for developing multimediacommunications platforms
First success in VoIP switching, SIP trunking; now Netaistrusted with critical unified communications platforms
Turkcell
Several projects including network monitoring, usermessaging and e-payments
Innovation incubation through NWCTF
NetaWesley Clover Tech Fund is an entrepreneur-led
commercialization fund specializing in seed-stage investments into
technology companies in Turkey
The initiative is a partnership between Neta, Sir Terry Matthews
(Wesley Clover), and TRPE Capital
7
-
5/22/2018 Netas company overview
8/11
Netais the largest and fastest-growing standalone systems
integrator in Turkey
550460
193112 73 62
672
368
171 128 100
Ericsson Neta KoSistem ALU Sentim Atos Turkcell
Teknoloji
Datamarket Innova Bimsa Sekom
2012 revenue for Netaand selected Turkish market competitors
Source: Interpromedya
TRY mm
Global Players
Local SIs
Local Telcos
Netais #1 Turkish
systems integrator
Netais the Capital 500
#1 fastest growing ICT
company, and 18th
fastest growing companyin Turkey
Netais now a regional,
converged systems
integrator with R&D and
a tier 1 partner
ecosystem
Neta
Players: IBM, Accenture,
Atos, Ericsson
Strength: complete
solutions / product
portfolios, global R&D
Weakness: limited
customization /
localization, high pricing
in consulting services
Global Players
Players: KocSistem,
Sentim, Datateknik
Strength: captive
conglomerate parents
(e.g., KocSistem, Bimsa)
Weakness: limited R&D
capability, low scale, in-
ability to address
complex or converged
projects
Multiple recent
bankruptcies (e.g.,
Meteksan, Servus)
Local SIs
Players: Argela, TT
Teknoloji, Innova,
Vodafone Oksijen,
Turkcell Teknoloji
Strength: captive telco
parents, governmentrelations
Weakness: limited
solution portfolio,
inability to address
enterprise IT needs
Local Telcos
8
-
5/22/2018 Netas company overview
9/11
Recent converged carrier / IT contract wins
Turkish Football Federation Akbank Ministry of Justice
Project entails next
generation stadiuminfrastructure and software
with 5 year service
agreement for 28 stadiums
Access control & security
(ID cards, CCTV)
Fan interaction (fan
database, ticketing system,
loyalty system, e-payments,call center)
Wireline & wireless
network infrastructure
Competed against
Accenture, ATOS, IBM,
Indra, Cisco, Gate
Elektronik, Proline, MTM
$55m win
Installation and
support of 16k+ IPtelephony lines for
Akbank hosted by Turk
Telekom
5 year contract with
Akbank to provide
maintenance andsupport services for HQ
and 1,000+ branches
Competed against IBM
$46m win
Connected 2,270 courts and
penitentiaries via videoconferencing systems
Includes 2 year service
agreement
$30m win
9
-
5/22/2018 Netas company overview
10/11
Financial overview
0
50
100
150
200
250
300
350
FY06 FY07 FY08 FY09 FY10 FY11 Nine
Months
12
FY12 Nine
Months
13
Order Booking $ Revenue $
$0
$5
$10
$15
$20
$25
$30
$35
$40
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
FY06 FY07 FY08 FY09 FY10 FY11 Nine
Months
12
FY12 Nine
Months
13
GM $ GM %
Order Booking
c.20% CAGR in the last 7 years
YTD 2013 order booking is $314myear over year growth
is 40%
Breakdown of order booking by segments for FY12:
87% SI 9% Technology
4% Defense
Revenue
c.25% CAGR in the last 7 years
YTD 2013 revenue is $182m - year over year growth is 17%
Breakdown of revenue by segments for FY12: 84% SI
11% Technology
5% Defense
GM contraction is due to change in product mix
Carrier grade products vs enterprise grade
resell products
10
-
5/22/2018 Netas company overview
11/11
Turkish SI Market Outlook
Thank you
11