ALTIUM HALF YEAR INVESTOR PRESENTATION

ALTIUM HALF YEARINVESTOR PRESENTATION

Aram Mirkazemi CEOJoe Bedewi CFOKim Besharati VP IR

19 – 23 February 2018Sydney & Melbourne

Record Revenue and Profit Growth with Contributions from All Regions and Business Units

2

Future performance - Forward looking statements, opinions and estimates provided

in this presentation are based on assumptions and contingencies which are subject

to change without notice, as are statements about market and industry trends,

which are based on interpretations of current market conditions. Forward looking

statements including projections, guidance on future earnings and estimates are

provided as a general guide only and should not be relied upon as an indication or

guarantee of future performance. An investment in Altium shares is subject to

investment and other known and unknown risks, some of which are beyond the

control of Altium Limited. No representation or warranty, express or implied, is

made as to the fairness, accuracy, completeness or correctness of the information,

opinions and conclusions contained in this presentation. To the maximum extent

permitted by law, none of Altium employees, its directors, employees or agents, nor

any other person accepts any liability, including, without limitation, any liability

arising out of fault or negligence, for any loss arising from the use of the information

contained in this presentation. In particular, no representation or warranty, express

or implied is given as to the accuracy, completeness or correctness, likelihood of

achievement or reasonableness of any forecasts, prospects or returns contained in

this Presentation nor is any obligation assumed to update such information. Such

forecasts, prospects or returns are by their nature subject to significant uncertainties

and contingencies. Before making an investment decision, you should consider, with

or without the assistance of a financial adviser, whether an investment is

appropriate in light of your particular investment needs, objectives and financial

circumstances.

Financial data

All dollar values are in US dollars (US$) unless as otherwise presented.

This presentation has been prepared by Altium Limited (ACN 009 568 772) and

is for information purposes only. It does not constitute financial product or

investment advice or a recommendation to acquire Altium shares and has

been prepared without taking into account the objectives, financial situation or

needs of individuals. Before making an investment decision prospective

investors should consider the appropriateness of the information having

regard to their own objectives, financial situation and needs and seek legal

and taxation advice appropriate to their jurisdiction. Altium is not licensed to

provide financial product advice in respect of Altium shares.

Altium, Altium Designer, Altium Vault, Ciiva, Circuitmaker, Circuistudio,

Octopart, PCBWorks, Protel, Tasking and Upverter, and their respective logos,

are trademarks or registered trademarks of Altium Limited, or its subsidiaries.

All other registered or unregistered trademarks mentioned in this presentation

are the property of their respective owners, and no trademark rights to the

same are claimed

Disclaimer

Agenda

2018 Half Year Financial Performance & Metrics

3 Leading and Transforming the Electronic Design Industry

Appendix: Company Overview

Company Highlights & Significant Achievements

2

1

4

Strong net profit growth of 51%

Record revenue growth of 30%

4% increase in subscriber seats to 35,977

22% increase in Altium Designer seats with 2,650 new licenses sold

Altium's Half Year FY18 Financial Highlights

Record EBITDA Margin of 30%(33.1% underlying)

H1 Revenue

H1 Revenue growth

H1 EBITDA Margin

2012

$100M

$70M

$50M

$30M

$90M

$60M

$40M

$20M

$10M

$48,342$26.4M

20%H1

$55.1M

H1 FY

2013

H1 FY

$29.0M

10%H1

$61.9M

2014

H1 FY

11%H1

$71.0M

2015

H1 FY

$37.6M

16%H1

$80.2M

2016

H1 FY

$42.6M

13%H1

$93.6M

2017

H1 FY

$48.7M

$80M

-16.3%

9.6%

18.4%

26.7% 25.0% 25.8%

$0M

$32.3M

$110M

2018

H1 FY

14%H1

$110.9M

30%H1

$63.2M

30.0%

Full Year Revenue

5

2,650Altium Designer seats

(Up 22%)

$63.2M Revenue (Up by 30%)

$36MCash

AU13cDividend

(Up by 18%)

DebtFree

A$1.95BMarket Cap

30%EBITDA Margin(Up from 25.8%)

35,977Subscribers

(Up by 4%)

$19.0MEBITDA(Up 51%)

$60.3M Sales (Up 28%)

11.48cEPS

(Up by 50%)

Altium’s H1 FY18 Financial Metrics

$14.9M Op Cash Flow(Up by 8%)

$14.9M

NPAT(Up 51%)

Driving Performance from a Position of Financial Strength

6

Record 30% revenue growth – with all regions and business segments delivering

double-digit revenue growth

China continued its rise and significance – delivering 30% revenue growth and

expanding further by opening a new sales office in Shenzhen

Octopart continued to outperform - through increased traffic and improved search

experience delivering 42% revenue growth

TASKING is building momentum – through organizational strength and growing

market opportunity

Release of Altium Designer 18 - a major software release with high-speed engine,

multi-board design capability & new user interface/user experience

Launch of NEXUS high-end solution selling – released Altium’s high-end PCB design

tool and established a separate internal sales channel focused on high-end solutions

Progress Update - First Half Significant Achievements

7

A New Organizational Structure to Scale

Corporate Services (Finance, HR, IT, Sales Ops)

Marketing SalesR&DBrand & Program

Management

Biz Dev

Aram Mirkazemi

CEO

Joe Bedwi

CFO

Ted Pawela

COO

Henry Potts

CSOSergey Kostinsky

CTO

Altium Org 2.0 – a new organizational structure to scale and deliver multi-product,

multi-channel strategy while maintaining strong operating leverage

XpedyzeHigh-end Channel

AltimyzeMainstream Channel

OctomyzeLongtail Channel

BSD - EMEA

Achieving Market Leadership by 2020

8

2015

2017

2020

2025

Strong Strategy, Leading Technology

& Revenue Momentum

$100 + MillionRevenue &

Expansion of Market Opportunity

PCB Market Leadership &

Emerging Leader in Systems

Design

BSD - Americas

Octopart

TASKING

NEXUS

BSD – Rest of World

30-35%

7.5-10%

7.5-10%

7.5-10%

Transforming Electronic Design

and its Realization

$200M -Revenue

35% --EBITDA Margin

15-20%

20-25%

* The target revenue of $200M may include 5-10% from future acquisitions** 35% reported EBITDA margin or better in fiscal year 2020 BSD – Board and Systems Division (accounts for all PCB products excluding NEXUS)

*

2020 Target Revenue Breakdown

**

Agenda





2

1

4

Revenue Sources – FY18 H1

Altiu

m D

esig

ne

r S

ub

scriptio

n

Octo

pa

rt

TA

SK

ING

Ma

inte

na

nce

Altiu

m D

esig

ne

r T

erm

-ba

sed

Lice

nse

s

TA

SK

ING

Te

rm-b

ase

d L

icen

ses

Oth

er R

ecu

rring

Altiu

m D

esig

ne

rN

ew

Pe

rpe

tua

l Lice

nse

s

TA

SK

ING

Ne

w P

erp

etu

al L

icen

ses

Oth

er N

on

-recu

rring

* Services includes revenue for TASKING, Altium Designer and NEXUS

Se

rvice

s *

10

20

10

30

40

50

60

$25.4(40.2%)

US Millions

$20.1(31.8%)

$4.9(7.8%)

$2.3(3.6%)$0.9

(1.4%)

$0.2(0.3%)

$0.6(0.9%)

$3.0(4.7%)$3.4

(5.4%)

$0.9(1.4%)

To

tal R

ev

en

ue

$63.2(100%)

Recurring Revenue

$35.8(56.6%)

Non-recurring Revenue

$27.4(43.4%)

NE

XU

S

Te

rm-b

ase

d L

icen

ses

$1.5(2.4%)

Revenue – Board and Systems [Martin]

BSD - Americas 5 Yr Revenue CAGR: 17%

5 Yr Recurring CAGR: 16%

$5m

$10m

$15m

$20m

$40m

2014 2015 2016 2018

H1

H1 Revenue: 17%

$25m

$30m

$35m

BSD – EMEA USD5 Yr Revenue CAGR: 15%


H1 Revenue: 38%

$5m

$10m

$15m

$20m

$25m

BSD – Rest of World 5 Yr Revenue CAGR: 11%


$3m

$5m

$7m

$9m

$17m

H1 Revenue: 32%

$11m

$13m

$15m

BSD – Total 5 Yr Revenue CAGR: 15%


H1 Revenue: 27%

$20m

$40m

$60m

$80m

Revenue

Recurring

H1 FY H1 FY H1 FY

2014 2015 2016 2018

H1H1 FY H1 FY H1 FY

2014 2015 2016

H1 FY H1 FY H1 FY2014 2015 2016 2018

H1H1 FY H1 FY H1 FY

2017

H1 FY

2017

H1 FY

2018

H1

2017

H1 FY2017

H1 FY

$100m

Revenue – Board and Systems

2013

H1 FY

2013

H1 FY

2013

H1 FY

2013

H1 FY

Revenue – TASKING and Octopart

12

MES (TASKING) Octopart

$2m

$4m

$6m

5 Yr Revenue CAGR: 15%


$2m

$4m

$8m

2014 2015 2016 2018

H1

H1 Revenue: 21.3%

$6m

H1 FY H1 FY H1 FY

2017

H1 FY

$12m

$10m

RevenueRecurring

$8m

2014 2015 2016 2018

H1H1 FY H1 FY H1 FY

2017

H1 FY

5 Yr Revenue CAGR: 44%H1 Revenue: 42%

2013

H1 FY

2013

H1 FY

13

Board and Systems – Underlying Metrics

Subscription Pool

Americas EMEA Rest of World

24,821

35,977 (+1,455)

15,378 (+ 1,387)

7,351 (+ 988)

25,000

15,000

10,000

5,000

20,000

-

30,00013,248 (+ 1,281)

FY14 FY15 FY16 FY18

Dec

26,943 (+2,122)

FY17

чDec Jun

Americas EMEA Rest of World

Altium Designer New Seats Sold

1,000

2,000

3,000

771 (+124)

755 (+83)

1,124 (+266)

1,916 1,756(-160)

2,162(+406)

2,650(+473)

2,177(+15)

2014 2015 2016 2018

H1

2017

H1 FYH1 FYH1 FYH1 FY

5,520(+339)

5,181(+863)

4,318(-337)4,655

35,00032,321

(+1,187)29,320

(+2,377)

Dec Jun Dec Jun Dec Jun

4,000

5,000

6,000

Altium’s Subscription Pool

14

20,000

10,000

5,000

0

15,000

25,000

30,000

35,000

40,000 +3,024+1,340

-2,90935,977

+6,269

+2,724 -5,605

31,134

34,522

June 2016

Ne

w

June 2017 Dec 2017

Growth pool ~ Developed Countries86% of subscription pool 87.7% renewal rate (FY17 - 86.6%)

Re

join

s &

Up

gra

de

s

La

pse

d

Constant pool ~ Developing Countries14% of subscription pool 30.1% renewal rate (FY17 - 35.8%)

Ne

w

Re

join

s &

Up

gra

de

s

La

pse

d

Su

bsc

rip

tio

n P

oo

l S

ize

15

Operating expenses

We support a Value-Based Market but, we service this market with a commodity selling model

R&D spend efficiency due to impact of restructured Tasking operations – R&D spending is aligned with our new release drumbeat

Sales and Marketing spending aligned to growth projections FY2017. Positioning reflected in FY2018 spends. We expect to experience positive impact moving forward

R&D

Sales

G&A

17.3 %

2015 2016 2018

100%

H1H1 H1

80%

60%

40%

20%

2017

H1

What Drives Altium’s UniqueOperating Leverage?

36.4 %

19.6 %

26.7 %

17.6 %

33.1 %

24.4 %

25.0 %

18.5 %

32.3 %

23.4 %

25.8 %

16.1 %

32.8 %

19.9 %

30.0 %

1.2 %

Acquisitions

EBITDA

Balance Sheet

16

FY14 FY15 FY18 H1FY16

$10m

$20m

$30m

$40m

$50m

$60m

$70m

$0

22,049

61,906

38,139

44,273

Dec-17 Jun-17 Jun-16 Jun-15

$ '000 $ '000 $ '000 $ '000

Cash and cash equivalents 36,025 44,273 38,139 61,906

Trade and other receivables 32,770 32,672 30,406 20,704

Other current assets 3,117 2,861 1,548 1,955

Total current assets 71,912 79,806 70,093 84,565

Trade and other receivables 1,030 2,531 5,379 1,499

Property, plant and equipment 5,524 5,054 5,091 3,886

Intangible assets 45,799 40,459 33,508 0

Other non-current assets 82,165 82,946 82,301 81,622

Total non-current assets 134,518 130,990 126,279 87,007

Total assets 206,430 210,796 196,372 171,572

Trade and other payables 7,307 10,179 7,188 6,048

Tax liabilities 1,863 1,008 2,713 4,989

Provisions 3,702 7,600 3,568 1,908

Deferred revenue 37,378 38,436 32,234 28,773

Total current liabilities 50,250 57,223 45,703 41,718

Deferred tax liability 5,923 5,276 4,793 0

Provisions 188 703 4,230 1,202

Deferred revenue 6,000 6,958 9,038 6,091

Other liabilities 2,283 674 1,813 959

Total non-current liabilities 14,394 13,611 19,874 8,252

Total liabilities 64,644 70,834 65,577 49,970

Net assets 141,786 139,962 130,795 121,602

Contributed equity and reserves 136,936 137,452 135,571 131,767

Accumulated profits (losses) 4,850 2,510 (4,776) (10,165)

Total equity 141,786 139,962 130,795 121,602

FY17

36,025

Cash and cash equivalents

FY18 H1 Cash includes payments for Upverter Acquisition ($US2.8M),

increased dividend ($US2.7M) and a contingent consideration payout of ($US6.2M)

17

Cash Flow

Dividends paid/declared

FY14 FY15 FY16

5AUD¢

10AUD¢

15AUD¢

20AUD¢

25AUD¢

0

8

4

8

8

10

10

13

Final

Interim

H1FY18 H1FY17 H1FY16 H1FY15

$ '000 $ '000 $ '000 $ '000

Cash flows from operating activities

Receipts from customers 64,501 54,397 43,919 37,032

Payments to suppliers and employees (48,965) (39,268) (37,366) (29,499)

Payments for expenses relating to acquisitions (347) (72) (839) -

Net Interest received/(paid) 32 (21) 38 228

Net income taxes paid (348) (1,320) (862) (408)

Operating Cash Flow 14,873 13,716 4,890 7,353

Capital Expenditure

Payments for property, plant and equipment

(1,592) (2,548) (1,779) (1,195)

Payments for intangibles (231) - - -

Proceeds on sale of assets - - - -

Free Cash Flow 13,050 11,168 3,111 6,158

Cash flows from investing activities

Purchase of subsidiary and contingent considerations (9,048) (2,939) (10,767) -

Cash flows from financing activities

Proceeds from issue of shares - - - 39,966

Dividends paid (12,534) (9,830) (7,644) (7,941)

Repayment of borrowings (6) (28) (30) (38)

Net cash used (8,538) (1,629) (15,330) 38,145

Effects of exchange rate changes 290 (162) (223) (1,140)

Decrease in cash and cash equivalents (8,248) (1,791) (15,553) 37,005

FY17 FY18 H1

12

11

18

Half Year Results Key Metrics

USD millionsH1

FY18

H1

FY17

+/-

%

H1

FY16

H1

FY15

Revenue (excl. interest) 63.2 48.6 30% 42.6 37.6

Reported expenses 44.2 36.1 23% 31.9 27.5

• Business expenses 42.3 34.2 24% 30.9 27.5

• One-off expenses 1.9 1.9 N/A 1.0 -

EBITDA 19.0 12.5 51% 10.7 10.1

Depreciation and

amortization2.5 1.7 47%

1.0 0.5

EBIT 16.4 10.8 52% 9.7 9.6

Net interest 0.1 - N/A - 0.2

Profit before income

tax16.5 10.8 53%

9.7 9.8

Income tax expense 1.6 0.9 N/A 0.6 3.0

Profit after income tax 14.9 9.9 51% 9.1 6.8

H1

FY18

H1

FY17

H1

FY16

H1

FY15

EPS 11.48 7.64 7.12 5.63

Dividends (AU cents) 13 11 10 8

Key Margin Analysis

EBITDA Margin

Underlying EBITDA Margin

Net profit before tax margin

Net profit after tax margin

Effective tax rate

30.0%

33.1%

26%

24%

9.7%

25.8%

29.7%

22%

20%

8.6%

25.0%

27.5%

23%

21%

6.1%

26.7%

26.7%

26%

18%

30.6%

Balance Sheet (USD millions)

Cash and equivalents

Net assets

36.0

141.8

36.3

131.6

46.4

125.8

59.1

43.4

Operating cash flows 14.9 13.7 4.9 7.4

Agenda





2

1

4

Rise of Smart Connected Devices

20

Internet of Things is driving the proliferation of electronics

Electronics at the Heart of All Intelligent Systems

21

Printed Circuit Boards are central to the design & realization of electronics

22

Success depends on the ability to move quickly

through innovation cycles

IOT is Driving the Pace of Innovation

Existing tools do not

adequately address the

needs of high-tech products

Electronics is critical

to speeding up cycles

of innovation

23

Current Engineering Tools Fall Short

The current model for tool integration is old and

has evolved around the notion of “tool-chains”

CA

M

CA

E

PLM

MCAD - Mechanical Computer Aided Design

ECAD - Electronic Computer Aided Design

CAE - Computer Aided Engineering - Analysis and Simulation

CAM - Computer Aided Manufacturing

PLM - Product Lifecycle Management

24

The Future of Engineering Tools is Multi-disciplinary…

Cloud System

Embedded Software

Electronic CAD

Mechanical CAD

Electrical CAD

ECAD and MCAD tools must communicate natively

and operate at the same level of abstraction

25

IOT is Driving Change in Engineering Tools

TECHNOLOGY TRIGGER

PEAK OF INFLATED

EXPECTATIONS

TROUGH OF DISILLUSIONMENT

SLOPE OF ENLIGHTENMENT

PLATEAU OF PRODUCTIVITY

• Benefits better understood• New methodologies developed• Best Practices identified

• Startups formed• Early adopters found• First generation

products produced

• Next generation products are produced

• Mainstream adoption• Unfulfilled promises• Only a few successes• Scores of failure

Transformation of electronic design & its realization is critical to success

Gartner's Hype Cycle for IOT

Transforming Electronic Design & its Realization…

Global Printed Circuit

Board Market

Estimated size: $80 - $100Bn

Electronic Design

Automation Tools


Electronic Design &

Manufacturing Services

Estimated size: $1,000 - $1,500Bn

Global Semiconductor and Electronic

Parts Manufacturing & Distribution


Electronic

Components

System

Design

Board &

Circuit

Design

Board

Fabrication &

Assembly

Product

Assembly

Requirements Validation

Concept Realization

$2 TrillionEstimated Industry Size

26

The Two Circles of Transformation…

Electronic

Components

System

Design

Board &

Circuit

Design

Board

Fabrication &

Assembly

Product

Assembly

Requirements Validation

Concept Realization

27

Digital

Model

Continuity

Business

Model

Continuity

Two Domains of Transformation

Transformation must be pursued in two domains – Business & Technology

Agenda





2

1

4

1985

1991

Altium's Journey - a Long History and a Promising Future

1999

29

2006

2010

20142015

2016

Now

The company was founded by creating the first version of Altium Designer, Protel PCB

Altium Launches Protel for Windows - World's first Microsoft Windows-based PCB design system

Altium Successfully completes an IPO on Australian Stock Exchange

Altium launches Altium Designer 6, the world’s first Native 3D PCB design software

Altium launches Altium Designer 13 introducing DXP 2.0, its next generation integration platform opening up Altium Designer to third-party developers

2- Altium relocated its HQ to California USA

1- Successful capital raising of $44M on ASX

1- Altium acquires Octopart, the #1 electronic parts searchengine in the world

2- Altium acquires Ciiva a cloud based electronic components management system

Altium partners with Dassault Systemes SOLIDWORKS to deliver a specialized version of its PCB design software for SolidWorks users

1- Altium surpasses $US100 million revenue target and delivers $US110 million for financial year 20172- Altium acquires Upverter, the developer of the world’s first fully cloud, fully collaborative electronics design systems3- Altium releases Altium Designer 18 and launches NEXUS

Altium's Journey - a Long History and a Promising Future

30

Printed Circuit Board Design and Manufacturing Process

Bare BoardLayout Film Assembled BoardCircuit Diagram

Design Capture Layout Fabrication Assembly

Printed Circuit Board Design and Manufacturing Process

31

Altium Has Always Been Easy to Do Business With

Uncomplicated Value Proposition

Direct Sales Force

Free Technical Support

Easy to Get Up and Running

Easy to Learn, Easy to Use

Easy to Maintain with No Hidden Costs

Altium’s DNA

Altium the “Easy to” Company

A Unique PCB Solution For Every Usage Profile

32

Altium Products

33

Diversity of Application

34

Diversity of Application

35

High Profile Customers

Automotive

Electronics & High-Tech

Life SciencesAerospace & Defence Consumer- Electronics

SemiconductorsIndustrial ControlsResearch & Education

Mobile Devices

Computers

High Profile Customers

Global Reach

36

Global Reach

7.82

21.635.09

13.26

2.37

4.52

2.81

6.34

1.9

4.6

2014 2022

0

10

20

30

40

50

60

Tota

l R

evenue (

Bill

ions)

CAD CAE CAM AEC EDA

13.9%

13.0%

8.3%

10.6%

11.8%

37

Global Engineering Software Market revenue, 2014 and 2022

Computer Aided

Design (CAD)

Electronic Design

Automation (EDA)

Computer Aided

Engineering (CAE)

Computer Aided

Manufacturing (CAM)

Architecture

Engineering &

Construction (AEC)

Segments CAGRRevenue

Source: Transparency Market Research

38

The Altium Advantage

Transformational Leadership

Established Global Business User-Centric DNA

Altium’s Strategy for Success

Building Strong

Strategic

Partnership

Transforming

Electronic

Design & Its

Realization

Disciplined

Execution to

Achieve Market

Leadership

Building a Strong Partnership with Leading Engineering

Software Companies to Connect ECAD with MCAD & PLM

Maintaining Disciplined Execution and Remaining Single-Minded About PCB

Market Leadership

Being True to Our Deep Conviction that Altium’s Journey Will Bring About Transformation of the Electronics Industry

39

Altium Values…

“Growing Revenue Strongly” and“Expanding Profit Margin”

“Regular Product Releases” and“Delivering Next Generation Products”

“High Volume Selling” and“Sophisticated Value Proposition”

Sales

PeopleFinance

Product

0

4

“the Genius of AND”

“Diversity in Thinking” and“Aligned in Action and Purpose”

Diversity in Thoughts

Perseverance

Adaptability Agility

Ingenuity

Transparency

40

Altium’s Long-Term Outlook

Altium’s goal is to achieve $200 million in revenue by 2020

✓ The proliferation of electronics through the rise of smart connected devices continues to drive

growth for our business in the foreseeable future

✓ Altium will continue to drive top line growth and expand operating margin

✓ Altium remains confident in its business momentum and its ability to achieve its 2020 revenue

target of US$200 million

✓ Altium will grow its reported EBITDA margin steadily and aim at achieving 35% or better by 2020

✓ Altium will continue to pursue partnership and M&A opportunities to support its long-term vision

of creating a product design and realization platform that is centered around electronics

Documents

ALTIUM HALF YEAR INVESTOR PRESENTATION