Business Overview
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BUSINESS OVERVIEW AUGUST 2017 Safe Harbor Some of the statements contained in this presentation that are not purely historical statements discuss future expectations or state other forward-looking information related to financial results and business outlook for 2017. Those statements are Statement subject to known and unknown risks, uncertainties and other factors that could cause the actual results to differ materially from those contemplated by the statements. The “forward- looking” information is based on management’s current intent, belief, expectations, estimates, and projections regarding our company and our industry. You should be aware that those statements only reflect our predictions. Actual events or results may differ substantially. Important factors that could cause our actual results to be materially different from the forward-looking statements are disclosed under the heading “Risk Factors” in our annual report on Form 10-K for the year ended December 31, 2016. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. This cautionary statement is provided pursuant to Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The forward-looking statements in this release are made only as of the date hereof and we undertake no obligation to update publicly any forward- looking statement for any reason, even if new information becomes available or other events occur in the future. 2 Perficient is the leading digital transformation consulting firm serving Global 2000 and enterprise customers throughout North America. With unparalleled information technology, management consulting, and creative capabilities, Perficient and its Perficient Digital agency deliver vision, execution, and value with outstanding digital experience, business optimization, and industry solutions. 3 Our Locations NORTH AMERICA CANADA Allentown, PA Fairfax, VA Toronto, ON Ann Arbor, MI Houston, TX Atlanta, GA Indianapolis, IN ASIA Boston, MA Irvine, CA Hangzhou, China Charlotte, NC Lafayette, LA Chicago, IL Milwaukee, WI INDIA Cincinnati, OH Minneapolis, MN Chennai, India Columbus, OH New York, NY Nagpur, MS, India Dallas, TX San Francisco, CA Denver, CO St. Louis, MO UNITED KINGDOM Detroit, MI Oxford 4 Enterprise Partners Strategic Partners 5 Market Forces Digital Cloud Healthcare Industry Financial Services Transformation Computing Evolution Regulatory Environment 6 Strategic Growth Drivers Geographic Increased Strategic Account M&A Plans Expansion Offshore Development 7 Focus and Expertise INDUSTRY SOLUTIONS BUSINESS OPTIMIZATION DIGITAL EXPERIENCE Perficient’s Industry Solutions enable Gain competitive advantage Map and follow the customer clients to grow market share, ensure through enhanced process, journey, leverage data to predict regulatory compliance and stand out performance, and data-driven behavior, and react and respond as an industry innovator through solutions that reduce cost, drive to deliver outstanding customer industry-centric business strategy, efficiency and productivity, and experiences across the channel. process and technology expertise. grow revenue. 8 Industry Solutions HEALTH SCIENCES FINANCIAL SERVICES AUTOMOTIVE RETAIL & CONSUMER GOODS ELECTRONICS & HARDWARE MANUFACTURING TELECOM 9 Health Sciences Practice Strategic consulting insights and pragmatic technology solutions that improve clinical, financial and operational efficiency. HEALTH PLANS PROVIDERS LIFE SCIENCES 26% OF H1 2017 REVENUE 10 Health Sciences Clients 1 Definitive Healthcare 2 BCBS.com 3 Definitive Healthcare 4 Forbes 5 DiscoverOrg 11 IP – Health Analytics Gateway More than a dozen high-margin implementations and meaningful pipeline 12 Financial Services Practice Deep Financial Services Domain Expertise BANKING ASSET & WEALTH CAPITAL INSURANCE MANAGEMENT MARKETS 15% OF H1 2017 REVENUE 13 Financial Services Clients Source: Forbes Global 2000 rankings 14 Business Optimization CLOUD DEVOPS BUSINESS PROCESS MANAGEMENT CORPORATE PERFORMANCE MANAGEMENT ENTERPRISE DATA AND BUSINESS INTELLIGENCE ENTERPRISE RESOURCE PLANNING OPTIMIZED GLOBAL DELIVERY 15 Digital Experience BIG DATA AND ANALYTICS DIGITAL STRATEGY CLOUD EXPERIENCE DESIGN COMMERCE ENTERPRISE SOCIAL CONTENT MANAGEMENT INTERNET OF THINGS (IOT) CUSTOMER RELATIONSHIP MANAGEMENT ENTERPRISE MOBILE DIGITAL MARKETING PORTALS 16 Our Digital Agency END-TO-END IS JUST THE BEGINNING With the strategic imagination of an agency, unleashed by the deep technical know-how of a consultancy, our execution never fails our vision. We dream big, build beautiful, measure confidently, and optimize obsessively. Because great brands are no longer “built” with a bull horn – they are made from every great customer moment. 17 Practices and Capabilities STRATEGY + PLANNING DIGITAL MARKETING + ANALYTICS EXPERIENCE DESIGN MOBILE + EMERGING TECH CONTENT STUDIO DIGITAL EXPERIENCE PLATFORMS 18 BROADER. DEEPER. BOLDER. BOUTIQUES Can be great at delivering creative point solutions but often unable to scale across the complexity of your business. DIGITAL AGENCIES Can be great at articulating digital experience but often unable to deliver on the vision once it cuts deeper into the enterprise. CONSULTANCIES Can be great at strategic vision but a large, institutional mindset often unable to craft nimble, differentiated solutions. 19 CONSULTING SERVICES UNIVERSE 20 Large Integrators • More breadth than depth • More expensive • Prescriptive, not collaborative • Struggle with creative 21 Boutiques • No breadth • No scale to handle larger projects • Limited integration capabilities • Limited industry expertise • Point solutions, not strategic vision 22 Agencies • Sizzle without substance • Struggle with technology – implementation and integration • Myopic - no strategic vision 23 Perficient The Premier Provider • Breadth and Depth • Integrated Creative and Technology Skills • Collaborative Approach (First a partner, then an advisor) • Vision, Execution and Value 24 INDUSTRY DATA Revenue by Industry (Top 10) Q2 2017 Q1 2017 Q2 2016 Healthcare/Pharma/Life Sciences 27% 25% 31% Financial Services/Banking/Insurance 15% 16% 17% Automotive and Transport Products 10% 11% 8% Retail and Consumer Goods 10% 10% 13% Electronics and Computer Hardware 9% 9% 6% Manufacturing 9% 9% 5% Telecommunications 7% 7% 6% Leisure, Media and Entertainment 3% 3% 3% Energy and Utilities 2% 2% 3% Business Services 2% 2% 2% 25 SOLUTION DATA Revenue by Solution (Top 10) Q2 2017 Q1 2017 Q2 2016 Analytics 19% 19% 16% Commerce 12% 12% 14% Custom Applications 10% 11% 9% Content Management 10% 10% 10% Management Consulting 10% 10% 7% Business Integration 7% 7% 6% Platform 6% 7% 10% Customer Relationship Management 6% 6% 5% Portals/Collaboration 4% 6% 8% Business Process Management 4% 3% 7% 26 PLATFORM DATA Revenue by Platform Q2 2017 Q1 2017 Q2 2016 IBM 32% 31% 36% Oracle 12% 11% 9% Microsoft 11% 13% 16% Salesforce 7% 5% 4% Adobe 4% 4% 4% Magento 3% 3% 3% Other Technologies 24% 25% 21% Management Consulting* 7% 8% 7% *Platform independent 27 ABR – progress & potential $250 900,000 $225 800,000 $200 700,000 Messaging “up market”, building brand awareness 600,000 $145 $146 $144 $145 and growing mindshare = $150 $135 continued opportunity to 500,000 close a still significant domestic rate gap going ABR 400,000 $100 forward. 300,000 Offshore Hours $43 200,000 $50 $39 $41 $36 $36 $25 100,000 $0 0 2013 2014 2015 2016 H1 2017 Largest Competitors Onshore Offshore Offshore - Volume 28 2017 YTD Top 50 Clients 29 Our Competitive Success BEAT THE BOUTIQUES EASILY AND WE CONTINUE TO ROUTINELY BEAT THE BIG FIRMS YTD win rates vs. 100 90 82 80 75 73 70 66 67 64 62 61 60 60 50 40 30 20 10 0 Accenture & Razorfish Infosys Tata Cognizant IBM GBS Deloitte & Deloitte Sapient Weighted Average Accenture Interactive Digital 30 Revenue & Profitability Total Revenue Growth 600,000,000 500,000,000 400,000,000 300,000,000 200,000,000 100,000,000 - 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017* * Year Projection 31 Revenue & Profitability Profitability Growth 80,000,000 70,000,000 60,000,000 50,000,000 40,000,000 30,000,000 20,000,000 10,000,000 - 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017* EBITDAS Net Income * Year Projection 32 GAAP and AEPS Performance 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 * GAAP EPS (diluted) Adjusted EPS * Year Projection 33 Client Relationships Growing Top 50 Accounts – $1m+ Accounts Revenue Average ($m) 120 6 104 96 4.8 100 92 94 5 4.4 4.1 3.9 80 74 4 3.5 69 3.2 2.9 60 53 3 2.4 40 40 2 20 1 0 0 2010 2011 2012 2013 2014 2015 2016 2017* 2010 2011 2012 2013 2014 2015 2016 2017* * Year Goal 34 Share Repurchase 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 - 2008 2009 2010 2011 2012 2013 2014 2015 2016 YTD 2017 36,000 SHARE 35,000 COUNT As of June 30, 2017 $11.7 million remained DATA 34,000 (under $135m authorization). Q3 – Q4 2017 are forecasts 33,000 32,000 Q1-14 Q2-14 Q3-14 Q4-14 Q1-15 Q2-15 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 Weighted Average Fully Diluted Outstanding Shares (#) 35 Free Cash Flow Schedule Free Cash Flow as % of Total Revenue 14.0% Average 10.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 YTD 2017 36 CUSTOMER 98% CUSTOMER SATISFACTION >98% of respondents indicated they would use Perficient again and recommend