Jan Vos - CFO

From a canal to the information superhighway

Founded in 1901 as a bookshop

on a canal in Amsterdam. Today

Swets is the largest global player

in the management of acquiring,

accessing and managing

information.

A century of stability and growth Founded by Adriaan Swets & Heinrich Zeitlinger in

1901.

Swets bought out Zeitlinger after just one year.

Swets remained 100% owned by the Swets family

until the mid-nineties.

A group of external investors took a majority stake

in Swets for over a decade.

In 2007, Swets was sold to Gilde, one of the

premium investment firms in the Netherlands.

In 2008/09 Swets opened offices in India, New

Zealand, Finland, Austria & Switzerland

Also in 2008 Swets acquired Boekhandel E.

Frencken BV

Value proposition of Agents

an Agent adds value to it’s customers and

publishers

Simplifying the many-to-many relationships

Offering choice to customers

Offering an attractive indirect sales channel

to publishers

Supplier

Price & title info

Order/renewal

Invoice

Payment

Supply subscription

Offer/renewal

Order/renewal

Invoice

Payment

Supply subscription

Supply subscription

Customer

The primary business processes of Agents

Our services for Information Professionals

Without an Agent

Customers face a complex

administration process with every

single publisher

Many relationships:

Generates unnecessary costs Wastes valuable time Offering an attractive indirect sales channel

to publishers

With an Agent

Our services for Information Professionals

Gain the freedom to focus on what’s

most important to you and your

organization

Reduced time and effort devoted to

administering subscriptions More control over your subscriptions

investment Improved management of e-journal licenses Enhanced journal processing capabilities

Service offerings for Publishers

Without an Agent

Publishers face a complex administration process with every single subscriber

Generates unnecessary costs

Wastes valuable time

Duplication of effort & content

With an Agent

Service offerings for Publishers

Extend your reach to buyers and users across the globe

Establish or grow your presence in leading and emerging markets

Control your financing costs

Ensure your customers get outstanding service and support

Remove the time and headaches in managing the distribution of subscriptions yourself

Extend your reach & expand your visibility

As an Intermediary it is an Agents’ primary role to facilitate transactions between multiple customers and multiple publishers

Success is determined by the ability of the Agent to bridge the gap between non-congruent Customer and publisher demands

As with all non-financial elements (ordering, catalogue management, shipment, processing etc) wants to facilitate demands on both sides

The role of Agents in the financial planning cycle

Customer Demands

Local players Funding timing dependent on local

rules One invoice per faculty Invoice in own local currency Payment and authorization processes

not always up to speed No currency risk

Country risk not manageable Customers want interest fee on excess

cash Sub-standard processes and systems VAT – issues when dealing with

foreign publishers

Publisher Demands

Global players Payment to be received in advance of

sub-year Invoice per title or institute Invoice in own local currency Strict guidelines on payment terms

No currency risk – albeit on a different currency

Country risk needs to be managed Publishers usually not able to give

interest fees Sub-standard processes and systems VAT – issues when dealing with

foreign customers

The role of an Agent in the financial planning cycle

Working Capital management

Invoicing procedures Management

Exchange rate management

Country risk management

What roles does an Agent perform to facilitate financially transactions

In the second and third quarter of any year Customers make prepayments towards the agent

Swets pays an interest fee on those prepayments

Around August most customers start ordering their subscriptions for the coming year

Typically Publishers wish to receive the payment alongside the order

Publishers are not always able to invoice in time

an Agent invoices the customers and collects the cash as soon as possible

Before the end of the year an Agent puts the order and the payment with the publisher

What roles does an Agent perform to facilitate financially transactions – Working capital Management Cycle - 1

What roles does an Agent perform to facilitate financially transactions – Working capital Management Cycle - 2

In certain countries prepayments on behalf of the customers need to be made

an Agent can make those prepayments against an interest fee

As most customers want invoices specified the way they can manage best most publishers are not able to do that

As an agent Swets is able to generate invoices towards Customers irrespective of Invoices send from publishers

Swets put in right VAT/Sales tax on both sides and acts as a clearing house

As the majority of transactions is in Q4 / Q1 VAT - maintenance takes place in Q2/Q3

What roles does an Agent perform to facilitate financially transactions – Invoicing Procedures Management

Given many transactions every year foreign currency flows are highly predictable over time

Typically Swets is able to match the majority of currency exposure internally

The remainder is hedged via external parties

As such an Agent is able to meet both Publishers’ and Customers’ needs to de protected against currency fluctuations within the year

What roles does an Agent perform to facilitate financially transactions – Exchange rate management

Country risk management typical theme since the credit-crunch

Usually Customers have low to zero debtor risk given government backing in almost every country

For publishers there are two main risks : Default of a country Corporate debtors

Country-defaults have not occurred for a long time but are very actual

an Agent acts as a partner to discuss and manage these risks between Customers and Publsihers

What roles does an Agent perform to facilitate financially transactions - Country risk Management

As an Intermediary it is Swets’ primary role to facilitate transactions between multiple customers and multiple publishers

Success is determined by the ability of Swets to bridge the gap between non-congruent Customer and publisher demands

As with all non-financial elements (ordering, catalogue management, shipment, processing etc) Swets wants to facilitate demands on both sides

The role of Swets in the financial planning cycle