Neopost investor day 2015

Neopost Investor Day

January 16, 2015

08:30 – 09:00 Overall Vision D. Thiery

09:00 – 09:15 Financial Projections J-F. Labadie

09:15 – 09:45 Market Trends & Branding N. Scholz

09:45 – 10:30 Neopost Integrated Operations C. Garvey & D. LeStrange

10:30 – 10:45 Break

10:45 – 11:00 Group Hardware Solutions T. Le Jaoudour

11:00 – 11:45 Neopost Shipping Solutions A. Férard

11:45 – 12:30 Enterprise Digital Solutions H. Dura

12:30 – 14:00 Lunch

14:00 – 15:15 Demos

15:15 – 15:30 SME Digital Solutions N. Scholz

15:30 – 15:45 Neopost Labs P. Boulanger

15:45 – 16:30 Conclusions & final Q&A D. Thiery

Overall VisionDenis THIERYChairman and Chief Executive Officer

Neopost Investor Day

Communication is becoming more complex

Transactional mail continues to decline…

… while new forms of digital communication are growing

Our customers have to incorporate technology trends…

… in order to effectively communicate to their customers across multiple channels

4

Multiple Source, New Channels and Data Richness

Multiple sources of customer data and multiplication of media communication channels and delivery points

Increased interactivity between companies and customers

Richness of Data: Profile, Customer Type, Location

Neopost can help with this complexity

5

The Shipping Market is changing too

The parcel market is growing fast driven by the growth in e-commerce

Carriers are expanding their focus from B2B to B2C

The market is shifting its focus from the carrier to the Shipper and Consumer

Postal Organizations are investing for their networks to leverage the growth in consumer parcels

6

Neopost Ambition

MAIL SOLUTIONS COMMUNICATION & SHIPPING SOLUTIONS

CSS Dedicated UnitsNEOPOST INTEGRATED OPERATIONS (NIOs)

Build a Complementary Offer for Current Customer Base

Invest & Speed up Development in Non-Mail Related Business

Continue Developing Mail Related Business

• VAR

• OEM Software services

• SME oriented web / cloud based SaaS services

7

Neopost Ambition

MAIL SOLUTIONS COMMUNICATION & SHIPPING SOLUTIONS

CSS Dedicated UnitsNEOPOST INTEGRATED OPERATIONS (NIOs)

Build a Complementary Offer for Current Customer Base

Invest & Speed up Development in Non-Mail Related Business

Continue Developing Mail Related Business

Marketed to enterprise accounts

Developed for NIOs SME oriented web / cloud based SaaS services

OEM Software services

VAR

8

Synergies, Synergies, Synergies!

Neopost Growth Areas: What they have in common

Complementary to Neopost’s current business: synergies

Fast growing markets of good size (min $1Bn)

Neopost has the ability to take a leadership position

There is an opportunity for 15% ROCE

9

SME Opportunity

>5m SMEs across Neopost’s top 4 countries

The SME market for Digital Solutions today is largely untapped

Much of Neopost’s customer base is companies < 100 employees

SaaS & Cloud are making digital solutions affordable for smaller companies

10

Positioning Neopost for the Future

MS/CSS New Projects

Enterprise Digital

SolutionsShipping

Integrated Operations CSS Dedicated Units

CVP-500

SME Digital

Neopost Labs

11

Neopost Opportunity

A p p s / S a a S / C l o u d

CSS DUs

CSS DUs

CSS DUs

VAR

OEMNIO

NIO

Large Enterprises

Medium Size

SME/VSE

Shipping EnterpriseDigital


Partners

S M EDigital

Partners

12


MS/CSSEnterprise

Digital Solutions

Shipping

Clem GarveyEurope, APAC, Export

Alain FérardShipping Solutions

Henri DuraEnterprise Digital

Solutions

Dennis LeStrangeUSA, Canada

Nikolaus ScholzNew

Projects

Integrated Operations CSS Dedicated Units

New Projects

13

Neopost Executive Committee

CFO R&D & Supply Chain CMSO CTO CHRO

CSS DUsNew ProjectsEnterprise Digital Solutions Neopost Shipping Solutions

NIOsUSA, CanadaEurope, APAC, Export

Chairman & CEO

14

Sales evolution

Mail Solutions€922m

€1.0 billion

8%

€1.1 billion

17%

€909m

€186m

€1.1 billion

20%

› CSS sales increased by more than 40% per year since 2011› EBIT margin around 22% in 2014 despite a high level of investment

2014 (e)2013 2011

Communication & Shipping Solutions€81m

15

Mid Term Ambition

2017 – 20192014 (e)

€1.4–1.5 billion*

>35%

Mail Solutions

€1.1 billion

20%CSS:

› Ability to grow organically 2% to 4% from 2017-2019

*Exchange rate: €/USD 1.25 and €/GBP 0.78

Communication & Shipping Solutions

16

Mid-term projection

17

+0-2%/yearMS ~-2%CSS ~+20%

~22%

>+15%/year

EBIT margin*(%)

Breakdown ambition

80% MS20% CSS

Integrated Operations

New Projects

Enterprise Digital

SolutionsShipping

~15%

100% CSS

~20%Max. €10m

OPEX /year

Total Group

+2%-4%

> 35%

20-22%

OrganicGrowth

(%)

17

› Sales: €1.4 to €1.5 bn** by 2017-2019

* Calculated on sales including intercos ** Exchange rate: €/USD 1.25 and €/GBP 0.78

Financial projectionJean-François LABADIEChief Financial Officer

Mid-term projection

› Sales: €1.4 to €1.5 bn** by 2017-2019

* Calculated on sales including intercos ** Exchange rate: €/USD 1.25 and €/GBP 0.78

19

+0-2%/yearMS ~-2%CSS ~+20%

~22%

>+15%/year

EBIT margin*(%)

Breakdown ambition

80% MS20% CSS


New Projects

Enterprise Digital

SolutionsShipping

~15%

100% CSS

~20%Max. €10m

OPEX /year

Total Group

+2%-4%

> 35%

20-22%

OrganicGrowth

(%)

19

2014 estimated landing

› Sales: €1.1 bn

* Calculated on sales including intercos

20

~-1%MS: ~-2.8%CSS: ~+15%

~24%

~+13%

EBIT margin*(%)

Breakdown ambition

89% MS11% CSS


New Projects

Enterprise Digital

SolutionsShipping

~5%

100% CSS

<15% OPEX~ €10m

Total Group

~0%

20%

~22%

OrganicGrowth

(%)

20

Maintain NIO profitability at a high level - UK example

NIO UK proportion of CSS on total sales was 12% in 2013, is estimated to be at 14% in 2014

EBIT margin* of NIO UK was around 20% in 2013 and expected to remain stable in 2014

In 2015, CSS is expected to reach 16% of NIO UK total sales and NIO UK EBIT margin is expected to remain stable

Increasing share of CSS in total revenues allows the UK to offset decline in MS

* Before headquarter expenses and industrial margin allocation21

Continue to improve Enterprise Digital Solutions profitabilityBoth Satori and GMC have shown strong growth since acquisition

Satori revenue evolution (2011-14) GMC revenue evolution (2011-14)

80

100

0

60

40

20

74

61

12 14E13

41

2011

53

CHFm

0

60

40

20

100

80

16 18

2011 12 14E

28

13

26

$m Acquisition: 2009 Acquisition: 2012

CAGR (11-14E)+19.5%

CAGR (11-14E)+22.0%

22

Continue to improve Enterprise Digital Solutions profitability

Track record:• Satori EBIT margin grew from 10% in 2009 to around 20% in 2014• GMC EBIT margin grew from 10% in 2012 to above 15% in 2014• DMTI, Human Inference still around 10%

Mid-term potential:• Bring all units EBIT margin to 20%

Improvement factors:• Strong top line growth• Highly profitable VAR activity• R&D and G&A spending not growing as fast as sales

23

Improve Shipping profitability

Lockers without long-term commitment

1. Shared use of lockers or below 7-year exclusive commitment

2. No hardware sale3. Billing per parcel or per locker4. Service and maintenance revenues billed on top every

year

Lockers with 7-year commitment

1. Year one: recognition of a hardware sale for the value of the locker and a lease receivable (leasing model)

2. Following years: financial interest recognition in the P&L 3. Service and maintenance revenues billed on top every

year

Business model

› €20-30m sales potential by 2017-2019 with ~15% EBIT margin

24

Improve Shipping profitability

• Software editor• License sales and maintenance contracts• Strong growth potential• VAR activity possible• 10% EBIT margin when acquired

Same model as Satori or GMC

› 15-20% EBIT margin potential

25

Mid-term projection

14

18

22

EBIT margin

Horizon2014 2019

20 to 22%

Worst case

Base case

Best case

18%

26

Market Trends & BrandingNikolaus SCHOLZChief Marketing & Strategy Officer

Mail volumes are declining Mail* volume in Main 4 (US, UK, France, Germany)

100

150

200

250

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

?

Historical Trend Projections

Sources:Historical: US (USPS Quaterly Reports), Germany (Deusche Post Annual Reports), France (ARCEP Observatoire Postal), UK (Ofcom Reports)* only addressed mail

-0.4%

-5.3%

-6.6%

-3.5%

28

Example of the USA

Source: USPS Quaterly Reports 29

Worldwide MS Performance 2008-2013

Neopost MS vsPB SMB Perimeter


883 878 876 912 883 881

3 222

2 9702 860 2 788

2 672 2 615

500

1 500

2 500

3 500

2008 2009 2010 2011 2012 2013

NeopostPB+Neopost Revenue excluding currency effects

CAGR 2008-2013

-0.0%

Revenue (M€)M

€

-4.1%

CAGR 2010-2013

+0.0%

-2.9%

Nb: Neopost estimates at constant currency

30

Two Expansion Directions from our Core

Physical Communication

DigitalCommunicationShipping

31

Electronic Invoices MarketExpects strong growth over the next 3 years

Electronic Invoices – Overall Market Revenue (in $B)

(Estimates in %)

Focus on Europepenetration rate in Europe

Global E-invoicing Market by Geographical Segmentation 2012 European market

The regulation is a key pillar to adopting a full digital invoicing solutionsThe governments are switching quickly to the Electronic invoicing , pushing SMBs to adopt this process as well Ex: Denmark is the most advanced in Europe, due to government who established E-invoices as mandatory

Other marketsUSA: Need to Enhance Invoicing Process Brazil: E-invoice adoption is pushing by regulation, however the complexity involved, remains an hurdle

3.4 4.15.1

6.38.1

Source: Technavio market survey 20132016E2015E2014E20132012

CAGR +24%

Source: Billentis 2014

Source: Technavio market survey 2013

APAC 9%

EMEA 55%

Americas 36%

201420132012201120102009

B2B/B2G/G2B

B2C

24%

14%

20%

13%15%

11%13%9%10%

7%8%5%

32

CCM Software Market

Overall Market Revenue(in $M)

825

1,550

1,070

2010 2013 2017E

+9%

* Source: Gartner reports, NEDS analysis

Magic Quadrant for Customer Communication Management Software

33

Data Quality Software Market

Overall Market Revenue(in $M)

* Source: Gartner reports, NEDS analysis

727

2009 2017E

+14%

+12%

1,130

~1,850

2013

Magic Quadrant for Data Quality Tools

34

SMEs are digitising rapidly

› Neopost is legitimate to accompany its customers in their transformation from a communication 100% physical to a mix of digital and physical communication

Increasing Level of digitization

Physical Only 13% Held Back

13% Digitising

ExternalPull

26% Digitising

InternalPush

9%Steady State

reached(for now)

25%Fully

Digital

16%

Immediate opportunity for Neopost Mid-term opportunity

35

Large software providers try to bring their offers down market, while new entrants have a disruptive approach

New EntrancesStart with SaaS based freemium offer to attract customers who then pay for value added elements

Larger players Try to move down

to the pyramid, targeting the SMB’s customersby

developing a SaaS solution mostly for retention

and new customer acquisition

36

Value of E-Commerce is growing fast in the main 4 countries Shipping: Market Trends

2016E

90,272

2015E

83,047

2014E

76,400

+15.6%

2017E

98,126

2013

63,400

2012

50,000

2011

41,100

2012

45,000

2011

37,70057,500

2013

51,100

+13.2%

2017E

79,278

2016E

71,229

2015E

63,998

2014E

175 331159 404143 598

125 424107 10096 19684 107

2017E

+13.0%

2015E 2016E2014E201320122011

440392

347304

262225191

+14.9%

2016E 2017E2014E 2015E201320122011

Source: E-Commerce Europe Report 2014




Germany: Value of E-Commerce, (in Million Euros) UK: Value of E-Commerce, (in Million Euros)

US: Value of E-Commerce, (in Million Euros)France: Value of E-Commerce, (in Million Euros)

37

Shipping: Market TrendsParcel’s volume is growing fast in the Main 4 countries

Germany: Parcel Volumes UK: Parcel Volumes

US: Parcel VolumesFrance: Parcel Volumes

736685646598507

415341

2017E2016E

+13.7%

2015E2014E201320122011

994917843747666608549

2011 2013 2014E2012 2016E 2017E2015E

+10.4%

387354318293263236205

2015E2012 2013 2014E

+11.2%

2016E 2017E2011

4,993

2015E

+12.2%

2016E

4,527

2017E

5,4684,062

2012

3,588

2013

2,741

2011 2014E

3,161

Source: Transport Intelligent Data Report -2014 Source: Transport Intelligent Data Report -2014

Source: Transport Intelligent Data Report -2014 Source: Transport Intelligent Data Report -201438

Conclusion on market trends



$2-3bn* $3-4bn* $2-3bn*Market

addressedby Neopost

10-12% -3% 10-12%Growth rates

39* Source: Neopost and Gartner estimates

Neopost’s Branding JourneyJanuary 2015

A global launch in 31 countries in February 2015

41

A branding aligned with our business strategy is required to create awareness and claim legitimacy

Before 2012, we only had to manage Neopost as our sole brand to claim legitimacy in mailing - our core business

Our business strategy extended to developing digital communication and shipping solutions, in addition to our core mailing activity

Acquisitions are increasing the brand portfolio: GMC, Satori, Human Inference, DMTI Spatial, ProShip …

42

Our objective

Take our brand on a journey of transition(not create a new brand)

Create brand consistency throughout the whole organization and offer portfolio

Develop brand awareness and legitimacy in the digital and shipping world

Support a change in mindset

Make every employee a brand & strategy ambassador

Our Brand is the sum total of how our customers perceive us. Branding is about shaping that perception

« «43

“Which brand (from a short-list) would you most associate with your preferred attributes?”

CVA study over 2,000 companies (2014)

Brand awareness: our journey will continue to gain legitimacy for our new activities

Whilst viewed positively by customers, Neopost has a long way to go outside its customer base

Rebranding is the 1st step

Now we need to convince SMEs that Neopost is a trusted advisor for their migration to digital communication

44

The new brand positioningand design

New Positioning and Design - Overview

unique and freshA new color

A new logo

A new baseline

46

A brand architecture to reflect our main lines of business

47

What will our customers think

We asked for customers feedback

3 major markets 2 focus groups with decision makers

USA (Philadelphia)

UK (Manchester)

France (Paris)

from SMEs

from larger organizations

8 participants per group

› “Branding is the art of aligning what we want people to think about us with what people actually do think about us. And vice-versa.”

49

The new identity was seen in a positive light in all three markets

“I get the sense they are fast moving, I like what they are trying to do”

“The slogan helps to describe what they do”

“The color is great, it absolutely stands out”

“This shows they are finally moving into the present day”

“Now they feel less like a manufacturer and much

more like a provider of software and services”

It was agreed to be contemporary, adding dynamism and innovation to the brand

Respondents agreed that the new identity suggested a company that was moving into software and services, moving away from being a manufacturer

The brand end line (Send. Receive. Connect.) received a strong endorsement from all markets

Connect is the key word: it adds modernity and helps articulate this ‘enlargement’ of Neopost’s core business

Film Branding50

Neopost Integrated 0perationsClem GARVEY, Chief Operating Officer Europe, APAC, Export

Dennis LESTRANGE, Chief Operating Officer North America


New Projects

Enterprise Digital

SolutionsShipping



Solutions

Nikolaus ScholzNew Projects

CSS Dedicated Units

MS/CSS




53

Worldwide MS Performance



883 878 876 912 883 881

3 222

2 9702 860 2 788

2 672 2 615

500

1 500

2 500

3 500

2008 2009 2010 2011 2012 2013

NeopostPB+Neopost Revenue excluding currency effects

CAGR 2008-2013

-0.0%

Revenue (M€)M

€

-4.1%

CAGR 2010-2013

+0.0%

-2.9%


54

NIO Key Objectives

Strongest Resilience Possible on MS

Grow CSS Activities where net of MS and CSS is overall growth even if it’s small (assumptions -2% in MS & +~20% in CSS)

Bring Products from Dedicated Units to NIO Customers

Maintain highest level of EBIT

55

OVERVIEW

Defend Market Share while striving to maintain margins through synergies and shared servicesAccelerate CSS digital solutions

Take market share in MSImprove cross selling FIAccelerate CSS digital solutions

Continue to take share in MSLaunch first CSS Digital Solutions

Seize opportunities -Continue to optimize distribution network

Europe

North America Asia-Pacific

South America Eastern Europe

56

North AmericaDennis LESTRANGEChief Operating Officer North America

North America Key Objectives

Slight overall revenue growth• Mail Solutions: -2% to 0%• CSS ~ 20%

Align sales coverage strategy by product/channel• neoDirect• Direct • Dealer

Enhance customer experience• Consistency of systems & processes• Improve web presence and self-service options• Automate/streamline “Quote to Cash”

Maintain EBIT rate• Finish District consolidation• Re-balance OPEX between MS and CSS• Drive more efficiency & productivity

58

North America Productivity Evolution

313

324

310

330

341

Jan. 2011 Jan. 2012 Jan. 2013 Jan. 2014 Jan. 2015

Revenue / Employee ($K)

59

+9% in 5 years

Neopost USA Market Share Trends

17.4%

18.1%18.0%

18.5%18.6%

2010 2011 2012 2013 2014

Market Share in units

60

Neopost USA Market Share Trends

15.1% 15.7% 15.6% 16.0% 15.8%

25.7% 26.5% 26.4% 27.1% 28.2%

2010 2011 2012 2013 2014

Small

Mid/Comm

Market Share in units

61

324 329 336 356 337 339

1,8801,722

1,6351,555

1,449 1,393

0

1 000

2 000

2008 2009 2010 2011 2012 2013

Neopost PB+Neopost Revenue NA excluding currency effects

North America MS Performance 2008-2013

Neopost MS vs. PB SMB PerimeterNeopost MS vs. PB SMB Perimeter

CAGR 2008-2013

+0.9%

Revenue (M€)M

€

-5.8%


62

North America Organic Growth

Increase market share Better cross-sell with Document SystemFederal Government MarketMore Competitive Displacement

Mail Solutions CSS

Align sales coverageEnterprise shipping: ProShipDocument Management• OMS-500

• GMC Inspire

• Mailroom ToolKit

Data Quality• Infuse

• Data Improver

Shipping/Parcel Lockers• ProShip

• Neoship

63

North America market segmentation

Distribution & SupportCSS Solutions

GMC, Satori, ProShip (Direct from BU)

Local SpecialistDSS, Shipping

AR and Telesales

certified on CSS low end

solutions

Enterprise

Major Accounts

Mail Center

Small Business

GMC, Satori,ProShip

OMS500, Infuse, ESS

OMS100, Bulk Mailer, EMS, WTS

Neo Pref, Data Improver, NeoShip

64

North America field productivity and neoDirect

Increase Field Sales Productivity due to shift of low end hardware sales to NeoDirect

-

2.0

4.0

6.0

8.0

10.0

12.0

14.0

300

310

320

330

340

350

360

370

380

390

400

2012 2013 2014 2015B

NEO

DIR

ECT

BOO

KIN

GS

$M

SALE

S PR

OD

UC

TIV

ITY

$K

/QBS

FIELD SALES PRODUCTIVITY and NEODIRECT NeoDirect Bookings $M

Sales Productivity $K/qbs *

*Field Sales

Field Sales Productivity and NeoDirect

65

NeoShip

NeoShip: Use the franking machines for Parcels

Impb requirements

Value of postage for a parcel = 10 times a letter

Discounted rates

Ease of use for customers

Simple cash collection for USPS

Customer retention / acquisition of new customers

Expansion of postage financing

66

$250,000

$1,200,000

$77,270

$2,066,030

2014 2015

Revenue PostageFinance Pass‐through

15,454

413,206

2014 2015

2014 2015

NeoShip and Leasing/Postage Finance Synergies

(e) (e)

› A model that can easily apply to most SaaS/Cloud based applications

Financials Shipments

67

North America - GMC Inspire Synergies

Results• $5.5M in licenses, professional services organization (PSO) and maintenance• Current pipeline $10M+

Critical Success Factors• Alignment with Sales Coverage Model‒ Tier 2 is the NIO “sweet-spot”

• Vertical Market approach• Insurance segment at $3.2M‒ Government segment at $800K

‒ GMC partnership and brand

Benefits• Supports a “higher and wider” approach within the account• Workflow and solutions based• Pulls Equipment in solution—DS1200 placements• ROI sale

68

North America – Conclusion

Continue gaining market shares in MS

Continue developping CSS activities

Continue optimizing the organization according to the mix of MS/CSS

69

Europe, Asia-Pacific & ExportClem GARVEYChief Operating Officer Europe, APAC, Export

NIO Europe - A Transformational Challenge

SALES

Resilience in MS, maintaining marginsAccelerated growth in CSS

SHARED SERVICES & SYNERGIES

To increase productivityTo enhance customer experience

OFFERING

From CSS DU (OMS 500, DataImprover, etc)Through strong partnership

FAST GO TO MARKET

Sales & Marketing coordination to speed up GO TO MARKET,

especially in software and solutions

NEW MOBILISATION OF OUR PEOPLE

Engagement of Multinational teams across Region-wide Projects

71


SALES

Resilience in MS, maintaining marginsAccelerated growth in CSS

72

NIO Europe - SALES (1/3)

Growth in CSS Digital Solutions Revenue >= decline in MS Revenue (the principal focus of the NIO companies)• Sales of new Group-sponsored Digital Solutions (own and OEM)• VAR sales of CSS DU product

Regional alignment of Sales Coverage Strategy by Product/Channel • Direct Sales – General sales-force• Direct Sales – Specialised sales-forces• NeoDirect • SME digital solutions and on-line offerings

Strengthening and leveraging of Pre-Sales & PSO resources to support greater sales of solutions• Regional coordination of investment

73


Appropriate Pay-plans to address core resilience and solutions simultaneously • Leveraging of experience across territories and across Regions

(US/Europe-ROW)

Salesforce.com deployment• All European operations on SFDC by 31 January 2016

Neopost VAR Programmes• Central liaison with CSS DUs• Major account coordination

OEM development and management• FP• New channels

74


Key Measures of Success:• Increase in Sales Productivity• % of Sales-People having sold Digital Solutions• Evolution in ratio of Sales & Marketing Costs as a % of Sales

Actions engaged: • Transfer of Channel Marketing resources from GMS to Operations • Study of existing Sales, Sales Support and Marketing resources in NIO’s• Engagement of Region’s Senior Managing Directors in ambitions

75


OFFERING

From CSS DU (OMS 500, DataImprover, etc)Through strong partnership

76

NIO Europe - OFFERING

Continue to integrate CSS Digital Solutions into NIO catalogue proposed by the existing sales-force

Focus CSS Digital Solutions in areas where our research identifies Customer Pain-Points

Selectively develop VAR activity in companies where we can appropriately support it

Coordinate local initiatives so that we don’t lose focus on key strategic challenges and projects

77

NIO Europe - OFFERING

Output Solutions, own technology:Strong and complete product range for all type of customers and all countriesVAR program success

Incoming Solutions:Real success with DCS but only in UK so far.The offer is still limited through local initiatives.

Shipping Solutions:Track inside development in major account (Samsung – Axa – AG2R …)SaaS solutions proving difficult on existing technologies

Data quality:DataImprover success in UK to be replicated in the other countries. (USA – Germany)Partnership with Deyde, 3rd party provider, for Italy (and Iberia, Mexico)

DCS & UK Neopost ChannelFeb 12 to Jan 13 – £491kFeb 13 to Jan 14 - £618kFeb 14 to Sep 14 (8 months) –. £766k

Output Solutions, OEM:Industrialisation of NeoTouch offer

78

Outsourcing mail

E‐invoicing

NIO Europe – Neotouch – OFFERING

79

Revenue impact of Neotouch on Neopost France traditional customers.Sample: 115 accounts - 1 full year revenue CORE = All core revenue (FM, FI , leasing , ink ,services …)NEOTOUCH = 1 full year revenue of services without franking

NIO Europe – Neotouch – OFFERING

x3

Results of the pilot phase

80

NIO Europe – Neotouch – Key findings

Key findings:• Neopost France knows to market this type of product• Most of the contracts signed are over 36 months (64%)• Incremental revenue with high margin

Next steps:• Full launch in France• Launch under preparation with major NIOs:‒ First, the USA

‒ Then, Germany and UK

81


SHARED SERVICES & SYNERGIES

To increase productivityTo enhance customer experience

82

NIO Europe - SHARED SERVICES

As the Traditional Business declines, we must ensure that every euro spent on its support gives the maximum return across the entire Region and not just locally

Deployment of CSS Digital Solutions requires a level of support which smaller individual countries cannot provide on their own

Resources at Head-Office can be pooled in virtual teams with resources in NIO’s to provide better Employee support and a better End-User Customer experience

83

NIO Europe - SHARED SERVICES

Identified projects:• Product Engineering & Support

• Leasing

• Operational Marketing

• Call Centers

• Web-shops & On-Line activity

• Information Technology

• Sales Order Processing

• Other (Accounting, Human Resources, …)

84


FAST GO TO MARKET

Sales & Marketing coordination to speed up GO TO MARKET, especially in software and solutions

85

NIO Europe - NEW & FAST GO TO MARKET

Better co-ordination of Marketing Activities

Mutualisation of Operational Marketing Methodology• Search-Engine-Advertising, Search-Engine-Optimisation• Lead-generation for core-business

Deployment of new Neopost Branding will afford an Opportunity to achieve uniform messaging across Region, facilitating economies in: • Product collateral• Document conception and preparation• Website management

Local Marketing in NIO’s can be exclusively focused on real customer-facing value-added generation

86


NEW MOBILISATION OF OUR PEOPLE

Engagement of Multinational teams across Region-wide Projects

87

NIO Europe - PEOPLE MOBILISATION

Engagement of People in new Vision through new Group Internal Communication efforts and through New Branding Project

Leverage creation of new Group of Senior Neopost Leaders Team

Engagement of People in International and Regional Projectsto prepare Structures, Systems and Processes for the future:• Information Technology• NeoDirect• SME Digital Solutions

Leverage Neopost Talent Management Programme• Inventorying of Digital Skills

88

NIO Europe - Conclusion

Substitution of decline in MS Revenue by CSS sales

Productivity optimisation through synergies and sharing of Regional resources

Engagement of our People in an evolving Business Model, leveraging their entrepreneurship to the benefit of the Region as well as their local Operations

Accelerating the Go-To-Market of our Offers, especially in the Digital space

89

Group Hardware SolutionsThierry LE JAOUDOURR&D and Supply chain

Memphis

Loughton Drachten

Precico/Benchmark

Kong-YueIn-Tech

Hong Kong

Bagneux /Le Lude

Group Hardware Solutions Overview

International organization developing, producing and distributing Hardware Solutions to NIO and Shipping Dedicated Unit

R&D Centers • Bagneux (Fr)

• Drachten (NL)

• Loughton (UK)

Supply Chain• Le Lude (Fr)

• Drachten (NL)

• Loughton (UK)

• Memphis (USA)

• OEM Partners (Asia)

Mail SolutionsMailing Systems

ParcelLockers

Parcel Hardware Sol.

91

Document Systems

Packing Systems

Group Hardware Solutions Strategic Direction

Group Hardware Solutions

Maintain EBIT, Optimizing Mail Solutions and Innovating in Parcel Hardware Solutions

Optimization with NIO

• Remanufacturing

• Balancing workload between sites optimizing fixed cost

• Provide services to NIO: Spare parts management, Swap

• Transfer of activity from Supply Chain to support NIO Shared Services

• Reduce R&D resources in Mail Solutions

Innovation with Shipping DU

• Parcel Lockers

• Packing Solutions

• Partly reallocate R&D resources from Mail Solutions to Parcel Hardware Solutions

Mail Solutions Parcel Hardware Solutions

92

Optimization Of Mail Solutions Supply Chain

• Remanufacturing (not applicable in China) is impacting production of new equipment

• For Low volume, variable Cost of Internal production is similar to OEM + Transport

• Opportunity in new Parcel hardware equipment

• Placement of Mail Equipment is decreasing

• Growing Neopost activity in Production Mail

• Opportunity to sell our products to other vendors (FP, Datacard…)

• Employee Retirement in our European sites (Direct and Indirect)

• Transfer of low volume products from Asia to Europe

• Deployment of Remanufacturing in Europe and Malaysia

• Review OEM partnership

• Continuous reduction of fixed cost

• Use of Supply Chain organization to support Shipping

Industrial Plan

Flexibility >10% in all sites Reduction of product cost from OEM

Maintain Growth Margin despite decrease of Mail Solutions Revenue

Results

General Environment

93

Remanufacturing: a Strategic Project Based on 4 Key Pillars

Leasing

• Allow to easily sale the Product as a service

• End of lease is generating a regular Return flow

Integrated Operation

• Promoting the Environmental benefit selling product without distinction between Remanufactured and New products

Development

• Eco Design approach engaged 10 years ago

• Product Roadmap with limited evolution allowing reused of previous platform

Supply Chain

• Local expertise in our sites

• Remanufacturing quality same as new

94

Social Benefits

•Circular economy generating local employment

•External communication

EconomicalBenefits

•Strong cost reduction

•Maintain retail price

EnvironmentalBenefits

• Decrease the environmental impact of the product up to 40%

• Anticipate future environmental regulations,

Contributing to Corporate Social Responsibility

95

› A worldwide approach managed within existing organization

A Worldwide Approach

96

Decrease Overall R&D Expense in Hardware Solutions, Reallocate Resources to Parcel activities

2,9 3,4 3,9

-

5,0

10,0

15,0

20,0

25,0

30,0

35,0

40,0

45,0

2009 2013 2014 2015

M€

Mail Solution Parcel Hardware Sol.

€38.5m

€ 29.8m

Parcel Locker• Innovate in collaboration with NIDPacking Solutions• CVP-500: - Continuous improvement

based on pilot feedback- Lower cost

Mailing System• Minimize development of new product• Focus on rollout and quality improvement,Document System• Minimize development of new product, focus on

supportProduction Mail• Maintain investment in this growing segment

Parcel Hardware SolutionsMail Solutions

97

While Reducing our Investment in Mail Solutions, Continuous Evolution of our Product Range is Minimizing Impact of Market Trend

DS-200

DS-65

DS-35 DS-63

DS-85/90

DS-75

Evolution of Industrial revenue of Document System

+3.5%/Y

DS-90i

DS-150/180

DS-1200 G3

› Renewal of offer every 5 years minimum

98

Neopost Shipping SolutionsAlain FERARDChief Operating Officer Neopost Shipping


New Projects

Enterprise Digital

Solutions


Solutions


CSS Dedicated Units

MS/CSS




Shipping


100

Global B2C e-commerce figures 2013 show double digit growth, driving parcel volumes Asia-Pacific is the largest eCommerce region and shows a solid growth rate

Asia-Pacific is the largest eCommerce region and shows a solid growth rate

Out of the 1.2 billion eShoppers, 8% buy cross-border

Considering ~55% of online orders are goods, the global e-Commerce market

for goods accounts for €645 bn

Top-3 (USA + China + UK) = 57% of global B2C sales

101

Global e-commerce figures show double digit growth, driving parcel volumes

102

• DHL is introducing parcel lockers for household

• DHL/DP plans to extand the PackStationnetwork in other countries (like NL, IT, …)

• Mondial Relay introduces « web-to-shop » service

• Pickup Services extending its network in France, Benelux and Germany

• DPD integrates ParcelShop network in Germany, Austria, Benelux for cross-border deliveries

• UK market is now covered by multiple large networks (Collect+, Hermes, UPS)

• UPS Parcel point pan european network set up

• Giants (Amazon, Google, eBay, Uber) are expanding sameday deliveryin local areas (LA, SF, NYC, …)

• Amazon acquired 25% of Colis Privé (aka Adrexxo)

• Alibaba investing 10% stake in SingPostto expand in APAC

• According IMRG, 17,5% of online orders on UK eshops are delivered outside the UK

Parcel delivery industry trends« Most of Innovation and investments are driven by eCommerce »

• B2C delivery leaders are expanding theirdelivery hours to meet with consumers needs• DPD UK will start Sunday deliveries soon• DPD DE will start Saturday deliveries soon• PostNL UK delivers up to 9.30pm

on tuesdays and thursdays• Rico Logistics UK offers sameday delivery

services 7 days a week

• Royal Mail will trial Sunday deliveryin London area

• UPS and Fedex to shift to dimensional pricingon many US ground parcel shipment on Jan 2015

• Cross border shipping on IPC and UPU agendas

eMerchants

Parcel shops

Parcel lockers

Carriers

103

Demand on the Parcel Market

Shipper Recipient 23 Carrier / Operator1Buyer

Needsto address

order pack ship collect accept, sort & route Deliver

Collect /receive return

› Neopost, the only player on the market with a global view of the logistic chain

Trust in shipment

Delivery time

Cost of shipment

Order packing systems

(cost of packing, volume

optimization…)Compliance control and

landing costs calculation

Tracking and tracing

Cost of transport (last mile)

Accessibility

Proof of delivery management

Client-server application for warehousing

Cloud/Saas application for e-commerce

104

Neopost current offer on the Parcel Market

CVP-500

Multi-carrier tracking software / RFID

Parcel Lockers

Compliancecontrol and

Landing costs

calculation




Mobile tracking solution

Trust in shipment

Delivery time

Cost of shipment

OSS

Cloud/Saas application for e-commerce

› Be for PARCELS what NEOPOST is for MAIL: THE FACILITATOR

105

CVP-500 packing solution

Continuous packing system delivering 3D optimisation of parcel size

Since January 2015, in the USA, UPS and FedEx decided to charge shippers according to the volume of parcels. CVP-500 clearly addresses new needs of shippersA first machine is operated by Doc Data, one of the largest Dutch e-commerce fulfilment providers

Two other machines sold to fulfilment companies in the Netherlands

Pack size=

Product size

No stock of predefined boxes, but pallets of

corrugated cardboard

Very broad range

of sizes

Up to500

parcelsper hour

1 to 10items per

parcel

Carton reusable

for returns or other

Shipping label

printed and applied on

the box

Order details

printed and packed at the same

time

No need for packing

fillers

Film CVP 106

CVP-500

Significant savings on labour

Up to 40% less shipping volume

No filler material needed

Up to 20% reduction in cardboard used

Flexibility for peak times

E-tailers

E-fulfilment professionals

Carriers

Any company handling large volumes of parcels

CVP-500

Main advantages: Automation & optimisation

-40%*

Manual

Operators concerned:

*

107

CVP-500 challenge

Technical development:smaller or bigger box size (currently: min high 10cm, max high 60cm)bigger number of items per box

Further development:We need to:• stabilize the technology• study the range we want to provide our customers with larger scope of dimension• set up partnership with cardboard supplier and other players• potentially address other segments

Parcels per day3,000 8,000

CVP-500

We are still working on the go-to market

108

Film ProShip

Multi carrier software:

Acquisition in may 2014

$10 million in sales in 2013, double-digit growth

Market leaderIndustry/Domain ExpertiseBrand RecognitionTop 5 volume shipping software in the US

Fastest performing software product on the market todayCapable of shipping millions of packages per dayAverage customer volumes at 50K packages per day

Carrier relationships

Diamond FedEx partner (one of only four Diamond Partners worldwide)Fastest growing volume solution for UPSFedEx and UPS expressed excitement with this “marriage” as they see this driving international shipping business using the ProShip product and the Neopost “name” and infrastructure

VAR* programme launched in Neopost USA

International perspective

109

, the ultimate solution for parcel delivery

No waiting line

Pick-up online shopping and drop returns in less than a minute

Convenient

Automated lockers to pick-up your online goods and drop your returns

Easy-to-useA user-friendly screen and easy steps to collect and return your goods

Secured

Electronic lockers, alarm and security camera to ensure goods

Convenient and easy-to-use automated parcel point to pick-up online shopping orders and drop returns in less than a minute when and where it suits you!

Film Packcity110

offer

Shared LockersWithout commitment

1. Shared use of lockers2. Billing per parcel3. Customer pays locker on demand: price is defined

per day and per season (yield management ) 4. Terminal configuration is decided by the

Packcity JV5. The Packcity JV takes the risk of not filling the

terminal, so price is higher than exclusive lockers

Exclusive LockersWith commitment

1. Exclusive use of lockers2. Monthly billing per locker3. Customer pays 100% of locker price, whether

used or not 4. Customer could decide terminal configuration

(column types, ...)5. Customer takes the risk of not filling the

lockers6. Customer can propose a location to place

the new terminal

2 main offers

› Services provided through Packcity: Online order delivery, Click & Collect, Conciergerie…

111

Packcity Operator Target markets and usage

112

agreement

1. Two JVs between Neopost-GeoPost:• Packcity France: Open network for all carriers and retailers (Click & Collect, conciergerie)

• Packcity GeoPost: Operating exclusively parcel lockers of GeoPost

• Majority and management: Neopost

2. Packcity sourcing hardware (via Keba), software and Services from Neopost

3. Geopost “committed” to install 1,000 parcels lockers by 2016 (Packcity GeoPost)

4. A global network of 3,000 parcel lockers in the long term

5. A total investment of €50m (2/3 Neopost, 1/3 GeoPost)

6. Estimated sales by 2017-2019: €20 to 30m

7. EBIT potential by 2017-2019: ≈15%113

in France

95 parcel lockers already installed in SNCF and RATP train station in Paris and suburb

100 installed by the end of January 2015

40 parcel lockers at our partners:

Relais Colis has partnership with major players:

With Mondial Relay

Full list available on www.packcity.com

› Close to 150 parcel lockers will be already installed by the end of January 2015

114

activities

2014: 14,485 delivered parcels and 1,055 returns

Average elapsed time to pick-up the parcel:1.01 day and 0.47 at SNCF terminals

Decathlon Paris Cnit La Défense

115

global potential

3 main markets will be launched in 2015:Residentials

UniversitiesCorporate

USA

BrazilPilot phase: 6 machines have been installed in July 2014

116

RFID solutions

Neopost – Cap Gemini - BearingPoint consortium selected by the French Ministry of Defence to implement the SILRIA IT system

SILRIA: a solution to ensure the optimisation and traceability of each stage of the French armed forces’ transportation flows all over the world, particularly in foreign theatres of operation

Neopost provides: identification and traceability solutions, from the RFID reader gates for ground lorries with portable readers to bar code printers and RFID tag encoders

Successful RFID pilot initiated in 2013

Deployment has started in H2 2014

€ 9m contract. € 4m have been already recognised (€ 1m in 2013, € 3m in 2014)

Case study: French Army General Headquarters (DGA)

› Neopost recognised as an expert in the RFID technology Promising contact with other NATO armies and suppliers (pilots are running in Europe)

117

Delivery time

Trust in shippment

Cost of shippment

Neopost ambitions

ProShip

Continue installation in France International development

Define the appropriate business/distribution model Cover larger packing needs




Set up solution for e-commerce players

Maintain strong position acquired with key players

CVP-500 Parcel lockers

Compliancecontrol and

landing costscalculation

for international

trading

118

Neopost shipping key messages

Market growth (CAGR at 2 digits on e-commerce)

Value chain showing how Neopost has a unique position to manage shipping without having to handle a parcel (and not competing with the main actors)

Competitive in terms of each position where we are active

We are getting organized to grow

We are building leadership

Be for PARCEL what NEOPOST is for MAIL THE FACILITATOR

119

Enterprise Digital SolutionsHenri DURAChief Operating Officer Enterprise Digital Solutions


New ProjectsShipping



CSS Dedicated Units

MS/CSS




Enterprise Digital

Solutions


Solutions121

Enterprise Digital Solutions Focus

122

CCM - Market Definition / Description

Customer communications management (CCM) is a strategy and a market fulfilled by applications that improve the creation, delivery, storage and retrieval of outbound and interactive communications. CCM supports the production of individualized customer messages, marketing collateral, new product introductions and transaction documents. CCM software is a set of software components for composing, personalizing and formatting content (acquired from various sources) into targeted and relevant electronic and physical communications between an enterprise and its customers, prospective customers and business partners. CCM software enables customer interactions through a wide range of media including mobile, email, SMS, Web pages and print.

The CCM market has evolved from the convergence of document generation/composition and output management technologies. CCM solutions today include the core elements of a design tool, a composition engine, a workflow/rule engine and multichannel output management.

Vendors are providing new delivery models, such as cloud SaaS, and incorporating social and mobile features into their product road maps. We estimate that CCM software was an $1070-million market in 2013, based on total software revenue worldwide. It is forecast to grow at a five-year compound annual growth rate of approximately 10-11%.

123

DQ - Market Definition / Description (1/2)

Data quality assurance is a discipline that focuses on ensuring data is fit for use in business processes. These processes range from those used in core operations to those required by analytics and for decision making, regulatory compliance, and engagement and interaction with external entities

This market includes vendors that offer stand-alone software products to address the core functional requirements of the discipline, which are:

• Data profiling and data quality measurement: the analysis of data to capture statistics (metadata) that provide insight into the quality of data and help to identify data quality issues.

• Parsing and standardization: The decomposition of text fields into component parts and the formatting of values into consistent layouts, based on industry standards, local standards (for example, postal authority standards for address data), user-defined business rules, and knowledge bases of values and patterns.

124

DQ - Market Definition / Description (2/2)

• Generalized "cleansing": The modification of data values to meet domain restrictions, integrity constraints or other business rules that define when the quality of data is sufficient for an organization.

• Matching: The identifying, linking or merging of related entries within or across sets of data.

• Monitoring: The deployment of controls to ensure that data continues to conform to business rules that define data quality for an organization.

• Issue resolution and workflow: The identification, quarantining, escalation and resolution of data quality issues through processes and interfaces that enable collaboration with key roles, such as data steward.

• Enrichment: The enhancement of the value of internally held data by appending related attributes from external sources (for example, consumer demographic attributes and geographic descriptors).

125

Gartner Magic Quadrant for CCM(Nov 2014)

Strengths:Good market understanding, robust product strategy, deep geographic penetration. Leading with interactive and multichannel offerings.Ability to execute on its offering and customer installations exceptionally well.One of the strongest customer experience ratings among users surveyed for the Magic Quadrant.

Cautions:GMC's overall viability, and in particular our assessment of the likelihood that Neopost will continue investing in the product and will advance the state of the art of the portfolio of products, is about average for the providers in this Magic Quadrant.

126

Gartner Magic Quadrant for DQ(Nov 2014)

Cautions:Deep experience of customer/party data issues

Limited support beyond customer/party domains

Limited mind share and market presence

Longer time-to-value mainly due to installation issues and product upgrades Pricing and cost are seen as in need of improvement

Strengths:Deep experience of customer/party data issuesStrong results from growth strategy: acquiring companies HI, Satori Software and DMTI Spatial, with customer-centric data management leading to further opportunities in the MDM / analytics areas. Adoption of alternative delivery models: SaaS and cloud-based deployments have seen strong adoption by Neopost reference customersProduct support: Reference customers reported high levels of satisfaction

127

EDS Footprint

EDS presence

EDS Offices

GMC (23) Satori (2) HI (4) DMTI (1) 128

EDS Strategy & PositioningCustomer Engagement - Customer Experience

Who you are communicating with.Identify my customers within different data sources.Trustworthy data.Correct and append if neededEnrich with external dataMerge into one golden customer profile

Feedback

KnowKnow

Understand and analyzeUnderstand and analyze

Create and manage campaign


AnalyzeAnalyze

CommunicateCommunicate

Golden Customer Record


Reporting and analysesImprove your processesImprove your customer profileCompare

DQ CCM Other applications

Customer EngagementCustomer ExperienceCustomer Journey

Deliver a highly relevant, personalized message.Deliver the message on the most relevant channel at right place. Save cost delivering it in the most efficient way.Reduce handling and correction cost.

Do I want to do business with this customer?Is this a risk or an opportunityWhat is relevant for himCan I find look a likes

129

Case example “Know”: Correct / merge customer data

EDS entityKnowKnow

AnalyzeAnalyze Understand and analyzeUnderstand and analyze






Customer was struggling to maintain its CRM data quality

2,000 addresses are collected everyday, at different stages of customer journey: when asking for information, ordering, and registering products, generating a mismatch

Kitchen appliances reseller, USCustomer

Client situation

BenefitsA unique customer identification was created; Satori solution enabled putting all addresses in correct form and eliminate database duplicates

130

Case example “Understand and Analyze”: Customer opportunity assessment

Uniongas was looking to further promote Union Gas solutions to additional eligible customers with a focused marketing effort

Union Gas was looking for key data on potential customers, including visualizing location, property characteristics, as well as estimated income

Major Canadian Natural gas provider

Thanks to DMTI solution, response rate from potential customers have been brought from 1% to 4% and even 8% in some areas

KnowKnow







EDS entity

Customer

Client situation

Benefits

131

Case example “communicate”: Deliver appropriate message to key customer

BAG (Business Advantage Group) is an integrated communication services provider in Mexico

BAG was looking for a solution that could help leveraging customer insight for relevant and effective communication

KnowKnow







BAG is now able to deliver completely personalized campaigns for VW bank being sent to customers with good credit history, classified as “not risky”, and finishing their credit

Inspire enables multi channel and response tracking

EDS entity

Customer

Client situation

Benefits

132

Case example “Analyze”: Improve your customer profile

4.5 millions of records on three different systems, with update of databases to be replicated manually from one system to another

KnowKnow







Care insurer in Netherlands

Achmea is able to serve its customers with a single customer view

Customer relationship database is kept optimally up to date

EDS entity

Customer

Client situation

Benefits

133

CCM and DQ Vision

CCM offer and fragmented DQ positioningFrom:

To:

Consolidated DQ positioning – Leader in quadrant

An un paralleled CCM offer – N°1 in Quadrant

AndA presence in new quadrants:

• Customer Experience• Customer Engagement• Customer Journey

+

134

CCM Vision

Become n°1 (Market, Analyst reports) and Enter a new wave / quadrant

Maintain leadership in CCMand enter a new wave / quadrant • Maintain innovation and technical leadership

Attract ecosystem partners

Attract “talents”

Provide “unmatched” customer support

CCM VISION

135

Inspire future releases will take us to a new wave / quadrant

The Forrester Wave™:

Enterprise Marketing Software

Suite

The Forrester Wave™:

Real-Time Interaction

Management

Gartner Magic Quadrant for the CRM Customer Engagement Center

The Forrester Wave™: Digital Experience Delivery Service

Projects for self-service, mobile, social engagement and real-time analytics.

Providing personalized experiences across channels

Cross-channel marketing platformsWeb analyticsCustomer interaction

Cross channel data integration capabilitiesReal time analytics

CCM VISION

136

Verticalisation strategy has been successful in the past 2 years at GMC

0

10

20

30

40

50

60

Note: 1Print Service Providers; 2Based on 11 months YTD; excludes some unallocated revenues

0%

28% 28%

2%

36%

57%

12/13 13/14²

PSP1

Entreprise

FSI

% growth

GMC Inspire revenues growth by vertical(2012-14)

137

GMC has acquired key customers in bank and insurance, while it is still a leader in PSPs

Banks Insurance PSPs

138

Data Quality Vision

Strategic:• Unify the offer and build a « differentiated » value proposition combining

the different « know-how ».• Be recognized as a “leader” by Analysts

Operational:• Optimize technological platforms• Rationalize the support functions (shared services)

DQ VISION

139

Data Quality Unified Offer

Feedback

KnowKnow

Understand and analyzeUnderstand and analyze



AnalyzeAnalyze




DQ CCM Other applications

DQ VISION

140

In order to help our customers to leverage the power of Data

Data quality is actually more important in the world of big data.

Ted Friedman, VP, GartnerCustomer Profile

Master Data

Enterprise Data

Suppression Data

Social Media Data

Behavioral Data

“”

DQ VISION

141

The combination of the 3 companies offer can bring an unprecedented level of Data Quality

Enabling companies to create operational efficiency gains, customer retention and acquisition

DQ VISION

142

Business Impact of an Increasing Data Quality

EfficiencyCustomer Retention

& Acquisition

Automated decisions

Orchestrated workflows

DQ VISION

143

Synergies will be implemented within EDS, starting with shared services

EDS synergies implementation

Description

Increased commercial, marketing and R&D effort:• Optimization of R&D resources

• Optimization of go-to market organization

• Common product vision / roadmap

Enhance / consolidate Gartner relationshipRationalization of shared services:• Finance

• HR

• Corporate Development

Timing 6 - 24 months

144

SME Digital SolutionsNikolaus SCHOLZChief Marketing and Strategy Officer


Enterprise Digital

SolutionsShipping



Solutions

CSS Dedicated Units

MS/CSS




New Projects


146

Neopost Opportunity

147

A p p s / S a a S / C l o u d

CSS DUs

CSS DUs

CSS DUs

VAR

OEMNIO

NIO

Large Enterprises

Medium Size

SME/VSE



Partners

PartnersS M EDigital

147

Investing to claim a relevant share in fast growing market

5m SMEs

>50% of SMEsnot digitized

TransactionsDocument/SME

Adoption rate for value added services

Market Opportunity

3-5bn €

148

3 key pillars of our SME SaaS solutions

Portal & Platform Applications Go-To-Market

149

Saas Platform – complex, powerful and highly scalable – released H1 2014

150

Saas Platform

It is the common platform for

• delivering all Nepost branded SaaS offerings

• targeting SME with respective products & services (Apps)

Portal & Platform

The foundation for our future business is ready in 2014

2014• launched in H1 in the UK• ongoing evolution (v1.2)• Software Development Kit

(SDK) for App integration successfully validated

Statuspowerful and scalableplatform ready to beleveraged for business and ready for app integration

151

3 key pillars of our SME SaaS solutions: Focus 2015

Portal & Platform Applications Go-To-Market

2014• launched in H1 in the UK• ongoing evolution (v1.2)• Software Development Kit

(SDK) for App integration successfully validated

Statuspowerful and scalableplatform ready to beleveraged for business and ready for app integration

2015• Increase number of Apps• Test & iterate fast

2015• Establish the right

go to market• Test & Iterate Fast

152

A variety of APPS & the right go to market

153

Mid Term Revenue Ambition

18 months 36 months

70k Users

300k Users

Paying Customers

15%

15%

ShortTerm

MidTerm

Vision

Ambition

• 50k customer

• 10-15m€

154

Investing to claim a relevant share in fast growing market

mid 2016t

Growth / H2

Innovation / H3

Mature / H1

Market Stage

end 2017 2020-2025

Relevant Market Volume

Market Opportunity

3-5bn €

* Market share similar to GMCs positioning in the Enterprise market 155

Neopost LabsPhilippe BOULANGERChief Technology Officer

Evolution of R&D/Project practices

Starting point: Mail is a mature industry with long cycles• Time to deliver isn’t much an issue• As long as we can replace old with new within 5 years

Evolution 1: Get timing back in control• By isolating innovation projects to de-risk product projects

Evolution 2: Optimization using best practices in software • Using Agile & Hanoï R&D Centre

Evolution 3: Focusing on incremental innovation• New projects: By reusing the maximum of existing proven parts / modules

Outcome:• Reduced time to market (6 months for DS63 vs 7 years for DS65)• Reduced R&D costs• Improved remanufacturability• Improved reliability

157

Evolution of R&D practices

Historic project cycles of our mature market: 3 to 7 years

Marketingspecifies

R&DDevelops

& IndustryBuilds

NIOslaunch, sell& support

However, we are facing very different parameters in the Digital world.

Our success of the past in a mature market could make us believe we will succeed in our digital transformation, using the same way of working…

158

What are the Key Parameters of the Digital World?

Exponential Technology• It’s more and more easy

to create a new set of apps and to test new business models

Disruption: part of newcomers basic vocabulary.• “Old” business models

and industries are easy targets

• Comes with velocity, adaptability & uncertainty

159

What is Happening in the Industry?

A clear recognition that established corporations are outsmarted by external creativity• Too few individuals are allowed to innovate: the focus is usually to optimize the bottom-

line and historic business activities• Internal innovation is not better than external one, and is usually not allowed to disrupt

*Planned for end of 2014

A common practice from startups to large corporations is to embrace the “experiment based culture”• GE has trained more than 6,000 people* to Lean Startup methodology and hundreds

of projects are experiencing linked benefits.• Intuit spends 10% of resources on Lean Startup based innovation• All startups are trained with Lean Startup, Effectuation, Growth Hacking, Business Model

Canvas. Stanford University has a specific course

Open Innovation uptrend• While 40% of CAC40 are considering Open Innovation as a key direction,

only 20% are active. (Source:BNP-Paribas/Navi Radjou)

160

Neopost answer: Catching up on Open Innovation key parameters

NeopostLABS

Investors/AcceleratorsNeeds of Valorization

And Exit

StartupsNeeds of Cash

And Access to Market

NeopostNeeds of New Biz,

DNA and Tech

161

Neopost LABS targets for next 18-24 months

Other firm’smarket

Potentialnew market

SME DigitalSolutions

Resources for Neopost LABS are multidisciplinary.

162

Targeting Startups in their lifecycle

« Valley of death »

Rev

enue

Concept Scalability

Time

Profitability

Seed+, Series AAngels

Seed capital

+++ Risk profile163

Feeding the funnel:Interfacing the Startups Ecosystem

Partnering with Accelerators• Started with 2 French accelerators

• Next, extension to our local Neopost subs with accelerators in other countries

Accessing the Deal Flow of key investors• We are in the process of selecting a lead investor giving us access to a curated deal

flow of opportunities

Using existing govt initiatives• BPI France knows 99% of French startups and all Intermediate-Sized Enterprises

(ETI) and Large Companies

Increasing our visibility of “Industrial Partner” and our credibility• Through our website (http://neopostlabs.com)

• Through our participation to conferences, events, blogs, social networks

164

InvestmentDecision:

Strategic & Investment Committee

SME Digital Solutions

Executing Governance on Opportunities

Filtering:

UsePartner

FundJV

Acquire(proposals)

or

Feeding

165

Key Takeaways about Neopost Labs

It allows to capture best practices and trends in• Technologies• Business models• Go to market methods• Ways of working

It’s a validated win/win/win setup between Neopost, startups and the investing community• Fueling partnerships or acquisitions

And last, it’s a best in class activity supporting the transformation of Neopost

166

Conclusions and Q&ADenis THIERYChairman and Chief Executive Officer

Leadership Ambition



$2-3bn* $3-4bn* $2-3bn*Market

addressedby Neopost

10-12% -3% 10-12%Growth rates

10-15% 30% 10-15%Market share ambition

168* Source: Neopost and Gartner estimates

Neopost in 5 years

Revenue €1.4 – €1.5 bn

Minimum 35% of CSS in total sales

Organic growth: +2% to +4%

EBIT margin: 20% to 22% (trending to 22%)

169

Neopost investor day 2015

Small Business & Entrepreneurship

Transcript of Neopost investor day 2015