Delivering Strong Performance & Growing Momentum to Market Leadership

ALTIUM HALF YEAR INVESTOR PRESENTATION

Aram Mirkazemi CEO 21-24 February 2017 Joe Bedewi CFO Sydney & Melbourne For personal use only use personal For Kim Besharati VP IR Disclaimer

Future performance - Forward looking statements, opinions and estimates provided This presentation has been prepared by Limited (ACN 009 568 772) in this presentation are based on assumptions and contingencies which are subject and is for information purposes only. It does not constitute financial product or investment advice or a recommendation to acquire Altium to change without notice, as are statements about market and industry trends, shares and has been prepared without taking into account the objectives, which are based on interpretations of current market conditions. Forward looking financial situation or needs of individuals. Before making an investment statements including projections, guidance on future earnings and estimates are decision prospective investors should consider the appropriateness of the provided as a general guide only and should not be relied upon as an indication or information having regard to their own objectives, financial situation and guarantee of future performance. An investment in Altium shares is subject to needs and seek legal and taxation advice appropriate to their jurisdiction. investment and other known and unknown risks, some of which are beyond the Altium is not licensed to provide financial product advice in respect of control of Altium Limited. No representation or warranty, express or implied, is Altium shares. made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in this presentation. To the maximum extent Altium, , Altium Vault, Ciiva, Circuitmaker, Circuistudio, permitted by law, none of Altium employees, its directors, employees or agents, nor Octopart, PCBWorks, Protel and Tasking, and their respective logos, are any other person accepts any liability, including, without limitation, any liability trademarks or registered trademarks of Altium Limited, or its subsidiaries. arising out of fault or negligence, for any loss arising from the use of the information All other registered or unregistered trademarks mentioned in this presentation are the property of their respective owners, and no contained in this presentation. In particular, no representation or warranty, express trademark rights to the same are claimed 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 For personal use only use personal For Financial data and contingencies. Before making an investment decision, you should consider, with All dollar values are in US dollars (US$) unless as otherwise or without the assistance of a financial adviser, whether an investment is presented. appropriate in light of your particular investment needs, objectives and financial circumstances. 2 Agenda

1 Company Highlights & Significant Achievements

2 2017 Half Year Financial Performance & Metrics

3 Pursuing PCB Market Leadership & EDA Transformation

4 Appendix: Company Overview For personal use only use personal For Altium’s H1 FY17 Performance Highlights

$100M 13% H1 $90M 16% $93,597 H1 $80M 11% H1 10% $80,216 $70M H1 20% $70,964 • Revenue growth of 14% $60M H1 14% $61,908 H1 • EBITDA Margin 25.8% $50M $55,072 • Achieved double digit sales growth and on- $40M $48,650 track to exceed $100M revenue in FY17 $42,594 $30M $37,599 • 4% increase in subscribed seats to 32,321 $32,295 $20M $29,036 $26,445 26.7% 25.0% 25.8% $48,342 18.4% $10M 9.6%

For personal use only use personal For $0M -16.3% H1 FY H1 FY H1 FY H1 FY H1 FY H1 2012 2013 2014 2015 2016 2017

Revenue EBITDA Margin Revenue growth 4 Driving Performance from a Position of Strength

Altium’s H1 FY17 Financial Metrics

$36.3M AU11c $47.0M Sales 7.64c Cash Dividend (Up by 14%) EPS (Up by 10%) 32,321 (Up by 7%) Subscribers $48.6M Revenue (Up by 4%) A$1.1B 25.8% (Up by 14%) Market Cap EBITDA Margin (Up from 25.0%)

Debt 13.7m Op Cash Flow 2,177 $12.5M $9.9M Altium Designer seats EBITDA NPAT Free (Up by 180%) (Up by 8%)

(Up by 1%) * (Up by 18%) For personal use only use personal For

* Seat count was impacted by 8% effective price increase.

5 Progress Update – First Half Significant Milestones

Delivered major upgrade to Altium’s flagship product, Altium Designer 17, representing the fifth consecutive annual upgrade.

Released new electronic/mechanical CAD product under OEM partnership with Dassault Systèmes SolidWorks.

Expanded direct sales presence in Europe acquiring long-time resellers in the Netherlands and the United Kingdom.

Began the modernization of our TASKING R&D and achieved highly-sought industry

accreditation to support the sale of TASKING’s compiler technology in the automotive industry. For personal use only use personal For

6 Achieving Market Leadership by 2020

2020 Target Revenue Breakdown

Acquisitions

Octopart 10-15%

5-7.5% TASKING

7.5-10% $200M Altium Designer 2025 In Total Revenue 55-65% 2020

5-10% $150M In Pure PCB 2017

2015 ATINA 5-10%

3-5%

For personal use only use personal For Strong Strategy, OEM $100 + Million PCB Market Transforming the Leading Technology Revenue & Expansion Leadership & Realization of & Revenue of Market Emerging Leader Electronic Design Momentum Data Opportunity in Systems Design Management 7 Agenda

1 Company Highlights & Significant Achievements

2 2017 Half Year Financial Performance & Metrics

3 Pursuing PCB Market Leadership & EDA Transformation

4 Appendix: Company Overview For personal use only use personal For Revenue Sources

1.0% Other Recurring ($0.5M) Vault Subscription and Term Based Licenses 1.0% ($0.5M) Transactional Tasking Term Based Licenses 0.4% ($0.2M) Revenue 44.2% 2.2% ($1.1M) ($21.5M – Altium Designer Term Based Licenses 3.7% up 15%) ($1.8M – up 6%)

7.2% ($3.5M – Tasking Maintenance up 150%) Altium Designer 33.1% Perpetual Licenses ($16.1M – up 14%)

Octopart Search

Altium Designer Subscriptions 40.2% 3.3% ($19.5M – ($1.6M – down up 9%) 5.8% 27%) Services ($2.8M – 2.0% up 47%)

For personal use only use personal For ($1M)

55.8% Tasking Licenses ($27.1M Recurring – up 14%) Revenue Other Transactional 9 Revenue – Board and Systems

BSD - Americas H1 Revenue: 5% 5 Yr Revenue CAGR: 15% BSD – EMEA USD H1 Revenue: 15% 5 Yr Revenue CAGR: 11% 5 Yr Recurring CAGR: 16% 5 Yr Recurring CAGR: 14% $40m $25m 11,159 12,463 $35m 10,015 10,865 17,973 $20m 8,468 14,253 17,177 7,961 $30m 10,146 10,931 8,927 $25m $15m $20m $15m $10m $10m $5m $5m

H1 FY H1 FY H1 FY H1 FY H1 FY H1 H1 FY H1 FY H1 FY H1 FY H1 FY H1 2012 2013 2014 2015 2016 2017 2012 2013 2014 2015 2016 2017 Recurring Revenue BSD – Rest of World H1 Revenue: 17% 5 Yr Revenue CAGR: 8% BSD – Total H1 Revenue: 10% 5 Yr Revenue CAGR: 12% 5 Yr Recurring CAGR: 9% 5 Yr Recurring CAGR: 14% $17m $80m 8,135 8,950 39,386 $15m 7,267 7,285 7,631 35,673 28,231 33,547 6,712 25,881 $13m $60m 23,600 $11m $9m $40m

$7m For personal use only use personal For $5m $20m $3m

H1 FY H1 FY H1 FY H1 FY H1 FY H1 H1 FY H1 FY H1 FY H1 FY H1 FY H1 2012 2013 2014 2015 2016 2017 2012 2013 2014 2015 2016 2017 10 Revenue – TASKING and Octopart

TASKING H1 Revenue: -5% 5 Yr Revenue CAGR: 10% Octopart Search 5 Yr Revenue CAGR: 34% 5 Yr Recurring CAGR: 8% H1 Revenue: 64% $10m $5m 5,425 3,485 5,158 $8m $4m 2,117 3,716 3,920 1,827 2,780 2,893 $6m $3m 1,020 856 826

$4m $2m

$2m $1m

H1 FY H1 FY H1 FY H1 FY H1 FY H1 H1 FY H1 FY H1 FY H1 FY H1 FY H1

2012 2013 2014 2015 2016 2017 2012 2013 2014 2015 2016 2017 For personal use only use personal For

Recurring Revenue

11 Board and Systems – Underlying Metrics

Altium Designer Seat Count Subscription Pool

32,321 6,000 (+1,187) 29,320 (+1,314) 6,363 (+152) 26,943 30,000 (+860) 5,000 24,821 (-222) 11,967 (+496) 25,000 4,000 2,177 20,000 (+ 15)

3,000 2,177 2,296 (+ 15) 2,162 15,000 13,991 (+539) 1,916 858 (+ 63) 2,000 1,756 10,000

672 (+ 25) 1,000 5,000 647 (- 73)

- -

For personal use only use personal For H1 FY H1 FY H1 FY H1 FY H1 H2 H1 H2 H1 H2 H1 H2 H1 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017

Americas EMEA Rest of World Americas EMEA Rest of World

12 Subscription Pool

Lapse Rate (LR) +2,507 Non-renewals +1,247 (Up from 2,490) 2,567 (Up from 1,150) (Up from 2,330)

New Subscriptions (NS) Re-join (RJ) Attached to New License Sales Lapsed Subscribers Re-joining and Upgrades

Growth pool = ~86.5% of Constant pool = ~13.5% subscription pool of subscription pool H1 FY17 renewal rate of 86.2% H1 FY17 renewal rate of 36.4% Down from 86.6% in FY16 up from 30.3% in FY16 Subscription Pool (SP) For personal use only use personal For H1 FY17: 32,321 (up from 31,134 June 2016)

Growth Equation = NS + RJ - (LR x SP) 13 Operating expenses

$11,373 $35M

$10,350

$7,095 $25M $15,709 R&D spend driven by capability acquisitions and product $14,083 investment.

$13,670 Sales and Marketing gaining efficiency as we implement our “go- direct” strategy $15M G&A increases due to One-Time Charges and Key Hiring

$9,021 $7,477 $6,520

$5M For personal use only use personal For

H1 H1 H1 2015 2016 2017

R&D Sales & Marketing G&A 14 Operating expenses

Operating Expenses as a % of Revenue

100%

80% 24.3% 23.4% 18.9% What Drives Altium’s Unique Operating Leverage?

60% 36.4% 33.1% 32.3% No Waste Culture – Every Dollar Counts

40% We support a Value-Based Market but, we service this market with a commodity selling model

20% 17.3% 17.6% 18.5% R&D is driven by a high product release rate

0% For personal use only use personal For H1 H1 H1 2015 2016 2017

R&D Sales G&A

15 Cash Balance

Dec-16 Jun-16 Var

$ '000 $ '000 $ '000 % 70,000 Cash and cash equivalents 36,348 38,139 (1,791) -5% Trade and other receivables 25,852 30,406 (4,554) -15% 60,000 Other current assets 2,083 1,548 535 35% Total current assets 64,283 70,093 (5,810) -8%

50,000 Trade and other receivables 3,669 5,379 (1,710) -32% Property, plant and equipment 6,512 5,091 1,421 28% Intangible assets 34,699 33,508 1,191 4% 40,000 Other non-current assets 81,871 82,301 (430) -1% Total non-current assets 126,751 126,279 472 0%

30,000 Total assets 191,034 196,372 (5,338) -3%

Trade and other payables 6,362 7,188 (826) -11% 20,000 Tax liabilities 1,461 2,713 (1,252) -46% Provisions 6,071 3,568 2,503 70% Deferred revenue 31,269 32,234 (965) 3% 10,000 Total current liabilities 45,163 45,703 (540) -1%

Deferred Tax 4,687 4,793 (106) -2% 0 Provisions 1,474 4,230 (2,756) -65% Deferred revenue 7,390 9,038 (1,648) -18% FY11 FY12 FY13 FY14 FY15 FY16 H1 FY17 Other liabilities 768 1,793 (1,025) -57% Total non-current liabilities 14,319 19,874 (5,555) -28%

Total liabilities 59,482 65,577 (6,095) -9%

For personal use only use personal For Net assets 131,552 130,795 757 1%

Contributed equity and reserves 136,296 135,571 725 1% Accumulated losses (4,744) ( 4,776) 32 -1% Total equity 131,552 130,795 757 1%

16 Cash Flow

H1 FY17 H1 FY16 Var Dividends paid/declared $ '000 $ '000 $ '000 % Cash flows from operating activities Receipts from customers 54,397 43,919 10,478 24% 25 Payments to suppliers and employees (39,268) (37,366) (1,902) 5% Payments for expenses relating to acquisitions (72) (839) 767 -91% Net Interest (paid)/received (21) 38 (59) 119% Net income taxes paid (1,320) (862) (458) 53% 20

Operating Cash Flow 13,716 4,890 8,826 180% 15 Capital Expenditure Payments for property, plant and (2,548) (1,779) (769) 43% equipment 10 Free Cash Flow 11,168 3,111 7,059 -56%

5 Cash flows from investing activities Payments for purchase of subsidiary, net of cash acquired (2,939) (10,767) 7,828 -73%

Cash flows from financing activities 0 Dividends paid (9,830) (7,644) (2,184) 29% Repayment of borrowings (28) (30) 2 -7% FY12 FY13 FY14 FY15 FY16 FY17 Subtotal (1,629) (15,330) 13,701 -89%

For personal use only use personal For Effects of exchange rate changes (162) (223) 61 -27% (Decrease)/increase in cash and cash equivalents (1,791) (15,553) 13,762 -88% Final

Interim

17 Half Year Results Key Metrics

Change Change USD millions H1 FY17 H1 FY16 H1 FY17 H1 FY16 % %

Revenue (excl. interest) 48.7 42.6 14% EPS 7.64 7.12 7%

Reported expenses 36.2 31.9 13% Dividends (AU cents) 11 10 10%

EBITDA 12.5 10.7 18% Key Margin Analysis EBITDA Margin 25.8% 25.0% Depreciation and amortization 1.7 1.3 Net profit before tax margin 22% 23% Net profit after tax margin 20% 21% EBIT 10.8 9.7 11% Return on equity 7.5% 7.3% Effective tax rate 8.6% 6.1% Net interest - - Balance Sheet (USD millions) Profit before income tax 10.8 9.7 11% Cash and equivalents 36.3 46.4 Net assets 131.6 125.8 Income tax expense 0.9 0.6 Operating cash flows 13.7 4.9 180%

Profit after income tax 9.9 9.1 8% For personal use only use personal For

18 Agenda

1 Company Highlights & Significant Achievements

2 2017 Half Year Financial Performance & Metrics

3 Pursuing PCB Market Leadership & EDA Transformation

4 Appendix: Company Overview For personal use only use personal For

Rise of Smart Connected Devices For personal use only use personal For

20 At the Heart of All Intelligent Systems is Electronics

For personal use only use personal For Printed Circuit Boards Central to Electronics

21 Innovation in the Age of Internet of Things

Exploration Innovation Adoption

(Discovery & Invention) (Pioneering & Development) (Accessibility & Refinement) For personal use only use personal For

Modelling, digitalizing and integrating all objects and processes associated with the creation,

adoption & evolution of smart products is critical for increasing the speed of innovation 22 The Future is Multi-disciplinary…

Cloud System Engineering Cloud application development and Infrastructure management

Embedded System Engineering Development of Control Systems in Electromechanical devices

Electronics Engineering Creation of high-performance electronic hardware with complex form factor

Mechanical Engineering Designing complex objects with sophisticated

electromechanical behaviour For personal use only use personal For

Electrical Engineering Development of wire harness and electrical systems in Electromechanical devices

23 Speeding up the Pace of Innovation

Electronics is critical to speeding up cycles of innovation

Existing Product Lifecycle Management (PLM) tools do not adequately address the needs of high-

tech products For personal use only use personal For

Success depends on the ability of the enterprise to move through

innovation cycles faster than its competitors 24

IoT Will Transform the EDA Industry... For personal use only use personal For

25 PCB Design Software Market Current Trends, Segmentation & Size

Product Differentiation Total PCB Market Size: $1 Billion

Product Reliability Currently Addressable: $600 Million High-End Tools 57% of market value - Top-down Direct Shorter Time-to-Market Enterprise Sales Model. Large engineering teams designing complex products. Lower Cost Products

Design Complexity Mainstream Tools Robust Data Management 36% of market value - Bottom-up direct / indirect sales model. Moderate to Shorter Cycle Time high design complexity, carried out by small teams of specialist engineers. Multi-disciplinary Tools

Systematic Design Reuse Low-End Tools 7% of market value - Indirect Collaborative Mindset Sales through partners. Simple designs carried out by multi-

For personal use only use personal For Lack of Formal Training skilled engineers. No Sustainable Economy

26 Source: Gary Smith EDA Altium’s Strategy for PCB Market Leadership

Altium’s Multi-Product, 1 Multi-Channel Strategy is Delivering the Next Generation at the Heart of Altium’s Agile Enterprise Solution bid for Market Leadership 2

A Well-Executed M&A and 7 Partnership Strategy is 3 Closing Advanced Capability Gaps in Critical to Success High-end PCB Design & Going Beyond

Maintaining Leadership in 4 Mainstream PCB Market

Online Collaboration &

Smart Workflow 6 For personal use only use personal For Smart Content Strategy - Monetization 5 Through Smart Delivery of Content

27 A Unique PCB Design Solution for Every Market Segment

OEM Partner Product X2 Platform

Mainstream PCB Design Tool

Design Realization CIIVA

(online Service) For personal use only use personal For

Community PCB Design Tool Streamlined PCB Design Tool Electronic Part-Pedia (Free / Unlimited) (Professional / Entry Level) (Wikipedia of Electronic Parts)

28 ATINA - Altium’s High-End PCB Design Tool

ATINA • Multi-board System Design Capability • Advanced Routing Capability • Constraint-Driven Design • Handling Large Boards with Ease

X2 Platform • Next Generation - 3D Graphics Engine • State-of-the-art User

For personal use only use personal For Interface/Experience • 64-bit Computing Architecture 29 Altium’s Long-Term Outlook

The proliferation of electronics through the rise of smart connected devices is driver of growth for our business for the foreseeable future

Altium will continue to drive top line growth while expanding operating margin to enter and maintain 30% plus

Altium expects to see continuing growth in revenue

Altium is confident that achieving market leadership in PCB design software by 2020 is well within its reach

For personal use only use personal For Altium’s goal is to achieve $200 million in revenue by 2020

30 Agenda

1 Company Highlights & Significant Achievements

2 2017 Half Year Financial Performance & Metrics

3 Pursuing PCB Market Leadership & EDA Transformation

4 Appendix: Company Overview For personal use only use personal For Altium's Journey - a Long History and a Promising Future

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

1985 Altium partners with Dassault Altium acquires Octopart, Systemes SOLIDWORKS to the #1 electronic parts Altium Launches Protel for Deliver a specialized version of search engine in the world Windows - World's first its PCB Design Software for -based SolidWorks users Altium acquires Ciiva a cloud 1991 PCB design system based electronic components Altium launches Altium management system Designer 6, the world’s first Native 3D PCB design software Capital Raising of 44M on ASX Altium relocated its HQ to 1999 California USA Successfully

2006

Altium Successfully completes an IPO on 2010 Australian Stock Exchange For personal use only use personal For Now 2014 2015 Altium launches Altium Designer 13 introducing DXP 2.0, its next generation integration platform opening up Altium Designer to third-party developers 32 Design and Manufacturing Process

Circuit Diagram Layout Film Bare Board Assembled Board For personal use only use personal For

Design Capture Layout Fabrication Assembly 33

Altium Products For personal use only use personal For

34

Diversity of Application For personal use only use personal For

35 High Profile Customers

Automotive Aerospace & Defence Life Sciences Mobile Devices Consumer- Electronics

Electronics & High-Tech Research & Education Industrial Controls Computers Semiconductors For personal use only use personal For

36

Global Reach For personal use only use personal For

37 Competition and Industry Landscape

1960’s & 1970’s 1980’s 1990’s 2000’s 2010’s 2020 Growth Cadnetix (LTM) Daisy Veribest (Intergraph) Mentor (Expedition)

Mentor Graphics 3% end (Board Station) - (CR-5000, CR-8000) Zuken High (CR-2000) CR-5000/8000 Zuken 3% Cadence (Allegro) Racal-Redac ECAD 7% (Cadence Allegro) Cooper & Chan Mentor (PADS) Workstation Based PADS PCAD Altium (Designer) 17% OrCAD (Cadence)

OrCAD Mainstream PC Based CADStar (Zuken) CADStar Altium (Protel) For personal use only use personal For Browser-based PCB Tools Accel Technology (Tango) Eagle

CADSoft (Eagle) end - National Instruments Electronic Workbench (Electronic Workbench) Low 38 Current Market Share for the ‘Big Four’ PCB Software Companies

Revenue Share - Pure PCB Excluding Wire Harness, IC Packing and Services

Altium 16% Mentor Graphics 37% Zuken 18%

Cadence

29% For personal use only use personal For

This chart depicts market share based on the most recent financial reports for the ‘Big Four’ PCB software companies (Mentor Graphics, 39 , Zuken and Altium) and the breakdown of the addressable market based on Gary Smith’s PCB Market Trends Report. Global Engineering Software Market revenue, 2014 and 2022

Revenue Segments CAGR 60 Electronic Design Automation (EDA) Computer Aided 50 4.6 Design (CAD) 6.34 11.8% 13.9% 40 4.52

30 13.26 1.9 20 2.81 Architecture 10.6% 2.37 Engineering & Construction (AEC) 13.0% 21.63 Total Revenue (Billions) Revenue Total 10 5.09 8.3% Computer Aided 7.82 Engineering (CAE)

For personal use only use personal For 0 2014 2022 Computer Aided CAD CAE CAM AEC EDA Manufacturing (CAM) 40 Source: Transparency Market Research The Altium Advantage

Transformational Leadership For personal use only use personal For

Established Global Business User-Centric DNA

41

Altium’s Leveraged Sales Strategy For personal use only use personal For

42

Altium’s High-Level Strategy For personal use only use personal For

43 Altium’s Long-Term Outlook

 The proliferation of electronics through the rise of smart connected devices is driver of growth for our business for the foreseeable future

 Altium will continue to drive top line growth while expanding operating margin to enter and maintain 30% plus

 Altium expects to see continuing growth in revenue

 Altium is confident that achieving market leadership in PCB design software by 2020 is well within its reach

Altium’s goal is to achieve $200 million in revenue by 2020 For personal use only use personal For