blurgroup.com © 2016 blur Group PLC 1
3rd/4th May 2016
blur Group Plc
The Enterprise Services PlatformSource Purchase Manage Deliver Marketplace
blurgroup.com © 2016 blur Group PLC
Agenda
● 2015 Financial highlights
● Q1 2016 update
● Enterprise Customers
○ Quantifying unmanaged spend for the Enterprise
○ Enterprise Customer profile and Roll Out
● Enterprise Case Study - Newcastle-under-Lyme Borough Council
● blur 5.0 The Enterprise Services Platform
● blur 6.0 Enhancing the Enterprise Feature Set
● Summary
● Appendices
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blurgroup.com © 2016 blur Group PLC
● Financial Reporting Council enquiry closed
● All contingent projects excluded. Robust, consistent revenue recognition, processes and policies
● Listing fee income phased out, Single User Access Fees & Cancellation Fees introduced
● First revenues from Premium Services in H2 2015
● Administrative costs reduce as efficiency improves
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2015 Financial highlights
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Measure 2015 2014Year on
Year
Project revenue $2.0m $2.6m (25%)
Cancellation (ex Listing) fees
$0.6m $2.1m (70%)
Other revenue $0.1m $0.0m N/A
Gross profit $0.3m $1.7m (82%)
LBITDA 1 $(8.9)m $(9.0)m (1%)
1 LBITDA is loss before interest, tax, depreciation and amortization, foreign exchange movements
and share option costs
Measure 2015 2014Year on
Year
Intangible assets (NBV) $2.7m $2.3m 20%
Cash balance $7.1m $17.4m (59%)
Trade and other receivables $0.8m $1.7m (52%)
Total Current Assets $8.9m $19.9m (55%)
Total Assets $11.7m $22.3m (48%)
Current Liabilities $1.8m $2.0m (14%)
Net Assets $10.0m $20.3m (51%)
● LBITDA improved by 1% compared to 2014
● Q4 2015 LBITDA improved by 40% compared to Q3 2015
● Cash burn reduced in Q4 2015 by 58% compared to Q3 2015
● Platform investment totals $4.0M. Significant investment in acquisition of supplier base
● $22.5M carried forward tax losses
2015 Financial highlights
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● H2 2015 change in project revenue largely offset by new, higher margin revenues
● Approx 30% increase in Direct margins (before staff costs) H2 vs. H1
● Actions which altered revenue profile:
○ SME to Enterprise transition completed○ Acquisition mechanisms changed away from digital acquisition to targeting Enterprise customers○ Shift in Sales strategy - Inside to Outside○ Extended Enterprise sales cycle
$ 000 H1 2015 H2 2015Half on
Half
Project revenue $1.1m $0.9m (15%)
Higher Margin revenues $0.0m $0.1m N/A
Other Admin costs 2 $2.4m $1.7m (30%)
2015 Financial highlights
2 Other Admin costs are Administrative expenses less Amortisation, Depreciation, Audit fees, Bad
debt provision, Loss on disposal, Staff costs, Operating leases and Foreign Exchange losses
blurgroup.com © 2016 blur Group PLC
● 2014 R&D tax credit received Q1 2016 - $0.5M
● Q1 2016 closing cash - $5.8M
● Two consecutive quarters of cost and cash burn reduction following actions in Q3
● Quarterly burn figures exclude FX
$ 000 2015 2014
Net Cash used in Operations $(7.8)m $(9.7)m
Net Cash used in Investing Activities
$(1.5)m $(2.0)m
Net Cash raised from financing activities
$(0.0)m $21.0m
Opening cash balance $17.4m $9.6m
Net (decrease)/increase in cash $(9.3)m $9.3m
Effect of unrealised forex movement on cash
$(0.9)m $(1.5)m
Closing cash balance $7.1m $17.4m
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2015 Cash Flow
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Q1 2016 metrics update
ALL PROJECTSQ1
2016Q4
2015CHANGE
No. No. %
Pitching On 97 104 -6.7
Kicked Off 101 97 +4.1
Completed 80 78 +2.5
● Proportion of Enterprise growing across key metrics
● Continued tightening of conversion rates and increase in repeat business
● 2 New Enterprise customers Q1 2016 - 1 US, 1 UK
○ First projects Kicked Off
ENTERPRISE PROJECTS ONLY **Q1
2016Q4
2015CHANGE
No. No. %
Pitching On 74 64 +15.6
Kicked Off 76 64 +18.8
Completed 42 44 -4.5
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Estimated global cost of indirect procurement waste - up to $2.28T
Cost reduction is the No. 1 strategic imperative for corporate CEOs in 2016 - KPMG
According to AMR Research, enterprises that do not
employ spend analytics regularly miss 10% - 15% in
savings
Better procurement systems could save 32.3 million
hours and $1.5B per year in North America alone*
While quick wins are appreciated, a truly effective
procurement waste reduction strategy will continue to
provide savings year over year.
Procurement Waste Reduction - Best Practice
● Smart Spend Management● Rightsourcing● Sharing Economies/Online Platforms
Immediate actions:
● Implement a competitive bidding structure● Go digital● Educate staff about fraudulent activities● Create strong supplier relationships● Implement a business services catalog
* Topline Strategy Group
blurgroup.com © 2016 blur Group PLC 9
Quantifying unmanaged spend for the Enterprise
Unmanaged purchases within the indirect spend category are estimated to consume up to 15% of an organization’s total spend
Through better management, an enterprise with an indirect procurement spend of $500 million can potentially add $25m to the bottom line without any sacrifice.
Unmanaged spend has a high level of procurement waste:
● Maverick spending
● Fraud
● Unmanaged contracts
● Excessive time lost by management due to poor
purchasing decisions
Starts with the indirect spend category
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Potential savings in indirect spend by industry & company size
Key early Enterprise verticals include:● Consumer Goods/FMCG● TMT
● Public Sector● Professional Services
blurgroup.com © 2016 blur Group PLC
blur customer profile
Customers Annual Revenue
Number of projects per account p.a
$300m$1bn+
200
500
1000
5000
25
$100m $50m $10m
Spot Buyers
Platform Customers
Telemarketing/Inside Sales Enterprise Sales
$5bn+
Optimise spot buyer base while developing Enterprise Platform opportunities
blurgroup.com © 2016 blur Group PLC
Enterprise customer roll out
Pilot Roll out 1 Roll Out 2
9-12 months
1-3
3-5
$100K
12-18 months
5-10
Single Function/Single country
$500K
Share Supplier Management
Multi-year
10+
Multi-function/Multi country
$1m+
Outsource Supplier Management
Trial Supplier Management
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Customer description Country
Electronic commerce and cloud computing US
Financial services US
Language services US
Systems integrator US
Materials manufacturer US
Security products manufacturer US
● Customers in Pilot or early Roll out 1
● Spot buyers:
Enterprise customer pipeline tracking
Customer description Country
Education - universities UK
Multimedia publishing UK
Catalogue retailer UK
Food products UK
Oil and gas/FMCG UK/EMEA
Multi-channel menswear retailer UK
Public sector council UK
blurgroup.com © 2016 blur Group PLC
Organization
Newcastle-Under-Lyme Borough
Council (NULBC) is responsible for
delivering a wide-ranging number of
services to inhabitants of the 22,000-
hectare Staffordshire borough,
including: waste services, recycling,
housing, regeneration and development,
benefits and Council Tax.
Problem
The council needed to demonstrate
local activity to support national debt
reduction strategy. NULBC focused on
local advertising on council-owned land
as a potential revenue stream.
NULBC failed to source a specialist
design firm via traditional public
procurement solutions like MyTenders.
The project halted for 18 months.
Solution
blur’s Marketplace. Within hours of
submitting project requirements, design
firms began to pitch for NULBC’s
project.
Within just 10 days, blur had identified
and shortlisted three specialist design
firms for NULBC.
A project that had been delayed for 18
months was finally back on track. The
project kicked-off shortly after.
Result
Five months post launch, the
advertising assets were already
generating a 300% increase in income
compared to previous years’ rental
values.
As many as 17 hoardings are now
planned for council land.
Estimated annual income for the
council is £80,000, or £800,000 during
the lifecycle of the project - the
equivalent of an 11% increase in
Council Tax for every household in the
borough.
Newcastle-Under-Lyme Borough Council case study
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blurgroup.com © 2016 blur Group PLC
blur 5.0The Enterprise Services Cloud Platform
Business units blur’s cloud based software and managed services Platform
Platform Features
Secure Access Worldwide Reach
Vetted Suppliers
Proven Process Exceptional Delivery
Mitigated Risk
More focus:● Buy from quality, motivated providers
● Competitive environment
● The best fit selected
● Global expertise across the supply base
● Stronger controls
More Choice● The preferred supplier list, fully vetted
● 65,000+ Service Providers worldwide
● On-demand delivery
● Scalable: Project volume and values
Streamlined process: ● Managed Services
● Single point of payment
● Enterprise project management technology
Achieve Operational Excellence within your Supply Chain
PitchBrief Project Delivery
Project Delivery Process
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blurgroup.com © 2016 blur Group PLC
Management Reporting
Spend and project progress reporting including total
project spend on an account, group and individual user
basis, and drawdown reports of spend against proposed
budgets
Multi-user Account Management
Introduce company accounts, manage users within an
account, set user groups and roles, account budgets,
user permissions for submitting and managing projects,
and workflow approvals
Universal DashboardSingle dashboard for users to buy and sell services,
as well as managing their account and all of their
projects
Turning suppliers into buyersAdding simple one click customer account creation
for Service Providers and simple switching between
buyers or sellers dashboards
Blur SenseImproved automation of service provider
shortlist and pitch ratings as well as automated selection. Search improvements with tagging in
user profiles and briefs
blur 6.0Enhancing the Enterprise Feature Set
blurgroup.com © 2016 blur Group PLC
● Two consecutive quarters of cost and cash burn reduction
● Conservative, accurate P&L & cash forecasting
● blur 5.0 The Enterprise Services Cloud Platform delivered
● blur 6.0 enhances the Enterprise feature set
● Growing proportion of Enterprise customers
● High margin ancillary revenues developing
● The Enterprise sales cycle is long
● Revenues scale once Enterprise customers in wider roll outs
Summary
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Cost efficiencies and cash optimisation is our No. 1 strategic imperative until Enterprise Platform customers are into wider roll outs
blurgroup.com © 2016 blur Group PLC
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Appendices
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blurgroup.com © 2016 blur Group PLC
blurring the lines between your company and your supply chain, changing the way you manage your spend
blur helps you reshape the way you run your business
Website DevelopmentTechnology
Public Relations Marketing
Video ProductionVideo
Cloud MigrationTechnology
Marketing Campaigns Marketing
Advertising Copy Content
Mobile App DevelopmentTechnology
Leadership Coaching Human Resources
IP & Patent Law Legal
ChangeManagementHR
SEO Content WritingContent
Financial & Business PlanningAccounting
IP DiscoveryInnovation
Data & AnalyticsTechnology/Marketing
blurgroup.com © 2016 blur Group PLC
blur Manage UltraEnhanced project support throughout the life a customer's project
blur Protect AdvancedAdded protection and customization of the customer’s project
blur ExpressFor fast turnaround projects
Enterprise Premium Services
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Enterprise Buyer PlansEnterprise buyers can choose from a range of monthly subscription plans to best support their annual usage requirements on blur’s Platform
Buyer and Seller Subscriptions and Licenses
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Buyer and Seller Subscriptions and Licenses
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Service Provider Plansblur’s subscription-based community gives Service Providers signing up to the Marketplace an opportunity to differentiate themselves through tiered-levels of value-added plans: Standard, Professional and Enterprise
blurgroup.com © 2016 blur Group PLC
blur Data is an interactive dashboard accessed via a paid annual subscription
It enables access to intelligence on the business services industry and services e-commerce including project trends, pricing and timeline forecasts as well as wider services industry analytics
blur Data
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