gxs worldwide inc
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GXS Worldwide Inc.GXS Worldwide Inc.Corporate OverviewCorporate OverviewCorporate Overview
2010 Wells Fargo Securities Technology
Corporate Overview
2010 Wells Fargo Securities Technology2010 Wells Fargo Securities Technology, Media & Telecom Conference
November 10th, 2010
2010 Wells Fargo Securities Technology, Media & Telecom Conference
November 10th, 2010
Forward Looking Statements gCERTAIN 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 “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. All
h h f hi i l f d d i h f hstatements, 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.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
t i t th t ievents or circumstances that may arise.
November 10, 2010 | Slide 2 © 2010 GXS, Inc.
GXS Todayy
Award winning B2B e-commerce company
providing Managed Services around the world
Headquartered outside of Washington DC,
servicing customers in 50+ countries
Approximately 40,000 customers and 2,700 B2B
e-commerce professionals
Large recurring revenue Continuing acquisitions to 400+ Managed ServicesLarge recurring revenue stream with strong cash
flow generation
Continuing acquisitions to expand scale and
drive growth
400+ Managed Services clients … 24% annual
revenue growth
November 10, 2010 | Slide 3 © 2010 GXS, Inc.
What We Do…On Demand Access to the Global B2B Ecosystemthe Global B2B Ecosystem
November 10, 2010 | Slide 4 © 2010 GXS, Inc.
GXS Trading Grid ®: Powering the Information Supply Chain
Market-Leading B2B Outsourcing GXS Managed Services: People Process and TechnologyGXS Managed Services: People, Process and Technology
400+ Customers use GXS’ Managed Services Today…400+ Customers use GXS’ Managed Services Today…
Intra-Enterprise Inter-Enterprise
November 10, 2010 | Slide 5 © 2010 GXS, Inc.
and New Customer Signings are up 100% Year over Yearand New Customer Signings are up 100% Year over Year
Business OverviewGXS Services and Solutions 2009 Pro Forma Revenue Mix
C usto m Outso urcing
D ata Synchro nizat io n
8%
Electronic network for real time exchange of electronic documents and data between business partners around the world through the GXS Trading Grid
Messaging Services
7%B 2B So ftware &
Services10%
the GXS Trading GridOutsourced management of
customers’ B2B integration infrastructure, including on-boarding of trading partners and
Managed Services
M anaged Services
22%
boarding of trading partners and mapping / translation services
Software and services that allow customers to effectively manage their day-to-day supply chain and
B2B Software & Services
M essaging Services
53%
y y pp yMFT activities internally
Tools and services that enhance customers’ abilities to exchange data with trading partners and Data g pmanage data more efficiency within their enterprise
Custom software and messaging solutions, which consist of
2009 Pro Forma Revenue: $487
Synchronization
Custom
November 10, 2010 | Slide 6 © 2010 GXS, Inc.
applications and products developed to address specific customer needs
Outsourcing
Diversified Customer Base
RetailRetail
CPG
Auto & Transport
Hi Tech
Financial S i
November 10, 2010 | Slide 7 © 2010 GXS, Inc.
Services
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.”
“GXS has a strong focus on providing complete managed services for B2B
integration”
November 10, 2010 | Slide 8 © 2010 GXS, Inc.
Source: Gartner Research Note G00172249, “Magic Quadrant for Integration Service Providers,” 20 November 2009
Source: Forrester, The Forrester Wave: B2B Service Providers, Q4 2009, October 2009
Leading CPG/Chemicals Firm Case StudyBuy Side and Sell Side B2B ProgramsBuy Side and Sell Side B2B Programs
Retail CustomersAutomotive Customers Client Challenges• Consolidation of multiple
B2B vendors and differing approaches by region
• On-going ERPSAP -North
AmericaSAP -
Europe
On going ERP consolidation and extension
• Complex customer integration requirements
Customer B2BIntegration Hub
Supplier B2B
– Demand Planning– Order Fulfillment
– Master Data Mgmt – Transportation
– Transportation– Settlement
• Differing standards used in automotive versus retail
GXS SolutionppIntegration Hub
g– VMI/Order Mgmt
p– Settlement GXS Solution
• B2B Outsourcing Program• Supplier Hub• 1000+ customers• 1000+ customers• 300,000 messages/month• 15% growth per year• Customer Award Winner
November 10, 2010 | Slide 9 © 2010 GXS, Inc.
Direct Materials Suppliers – Chemicals, Packaging 2008 Program
Global Financial Services Case StudyB2B Networking and Communications OutsourcingB2B Networking and Communications Outsourcing
VAN FramePoint-to Client ChallengesSMB Large
Async
RelayPoint
FTP andS-FTP
• Legacy cash management applications to send payment instructions to bank
• Don’t want to force upgrade
Customers Customers
Bisync
SNA
HTTPS
AS1/AS2
• Don t want to force upgrade• Expensive telecommunications
infrastructure to support dial-up networking approachAS1/AS2
GXS Solution
g pp• Outsource to reduce costs and
focus on core competency
Cash Management Gateway (Integration Broker)
Positive Pay & Automated Wire Transfer &
GXS Solution• GXS performs network protocol
mediation, security• Seamless migration of
Wholesale &Retail Lockbox
Cash Concentration& Disbursement
AccountReconciliation
Positive Pay &Fraud Monitoring
AutomatedClearinghouse
Wire Transfer &International
Seamless migration of customer base to GXS telecom infrastructure
• Client performs translation and li t b di
November 10, 2010 | Slide 10 © 2010 GXS, Inc.
client on-boarding
Driving a New Growth Engine: Managed ServicesServices
Managed Services Revenue Growth
Strong New Business Pipeline and Quality Customer Base
$341
$427 $455
$400
$500
$82
$100 +31% YoY
Growth
Revenue Growth and Quality Customer Base($mm) ($mm) Managed Services Pipeline
$341
$100
$200
$300
$59
$72
$82 $79
$60
$80
$0
$100
12/31/2008 12/31/2009 9/30/2010$43
$40Sampling of customers:
$0
$20
$02006 2007 2008 2009 YTD 3Q10
Contract signings up 100% YTD 3Q10 versus YTD 3Q09
November 10, 2010 | Slide 11 © 2010 GXS, Inc.
Contract signings up 100% YTD 3Q10 versus YTD 3Q09
Inovis Merger
• Closed June 2, 2010; Final UK regulatory approvals received end of J
• Industry transforming merger– Combines industry leaders with rich
June
– Combines industry leaders with rich histories in B2B electronic commerce
– Creates the industry’s premier provider dedicated to B2B with the
• Established 1967 as a division of the General Electric Company
• 30,000 customers in 50+ provider dedicated to B2B with the broadest and deepest portfolio of capabilities
– Customers expected to benefit from
,countries
– Customers expected to benefit from decreased B2B integration costs and improvements in performance, transaction visibility and process control • Established 1983 as Harbinger
• Strong ownership and financial backing continues
F i P t G ld G t C it l
g• 16,000 customers in 50+
countries
November 10, 2010 | Slide 12 © 2010 GXS, Inc.
– Francisco Partners, Golden Gate Capital, Cerberus, and Norwest Venture Partners
Cost Savings Analysis – First 12 MonthsMonths
CommentarySavings Areas
Significant executive and administrative headcount reductions
Redundant internal IT systems and services
Overlapping financial and legal services including auditors insurance etc
G&A
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
Sales and Marketing
y p g g p
Data Center savings through headcount reduction, third party applications, rent and other services
Transaction Engine savings from platform migrations and reduction of combined headcount
S f f
Operations and Engineering
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
Client & Professional Services
$27MM of net run-rate cost savings within the first 12 months after mergerTotal Cost Savings
November 10, 2010 | Slide 13 © 2010 GXS, Inc.
On track to deliver on expectations
Summary Financial Results$ In millions
Pro Forma Operations
Q3 YTD Sept 30th
2009(1) 2010(2) 2009(1) 2010(2)
Revenue 124.9 115.5 362.1 352.7
Combined Company Adjusted EBITDA 46.2 38.1 123.7 114.0Combined Company Adjusted EBITDA 46.2 38.1 123.7 114.0
Pro rated Net Synergies 3.5 16.3
Pro forma Adjusted EBITDA 41 6 130 2Pro forma Adjusted EBITDA 41.6 130.2
Pro forma Adjusted EBITDA % 36.0% 36.9%
S i D bt / A li dSenior Debt / Annualized Pro forma Adjusted EBITDA 4.72x 4.52x
November 10, 2010 | Slide 14 © 2010 GXS, Inc.
(1) – Combined standalone operations(2) – Combined standalone operations plus June merged operations
Summary Highlights
Leading
Robust Technology
Industry Position
Highly Experienced in Technology
Platform
pB2B
eCommerce
Recurring Scalable GlobalRecurring Revenue Base
and Strong Free Cash Flow
Scalable Global Infrastructure and Domain
ExpertiseDiversified
Business Mix
November 10, 2010 | Slide 15 © 2010 GXS, Inc.