TradeWindow CSO speaks with Proactive at the ASX SMIDcaps Conference

With me now live from the ASX Small Mid Caps Conference is Trade Window Executive Director, Andrew Bolgani.

Trade Window delivers business critical software for shippers and freight forwarders. Andrew, nice to meet you.

Likewise, thanks for having me here today.

Now, Trade Window describes itself as a mini WiseTech Global. Can you tell us more about the business and how you compete in this space?

Sure. So we provide business critical software for exporters, importers, freight forwarders and and customs brokers and where we cross over with WiseTech, it's for orchestrating cross-border trade. So we've within that we've got two customer segments. So the importers and exporters we call shippers. And we provide a solution that they use for capturing data out of their ERP system

to create all of the export documents that you need when sending a container of goods from one place to another and covering your compliance requirements. So think commercial invoice packing slip shippers lead of instruction. We connect in with the border agencies being customs and biosecurity in both New Zealand and Australia.

The other customer segment is freight forwarders and so these are businesses that work on behalf of some shippers, again to move uh goods from one place to another and deal with all of the uh compliance requirements around that.

And so we provide the ERP system so the the IT backbone for their business. Uh typically our our freight forwarders are based in Australia. We've got approximately 300 uh forwarders on our on our customer base.

And the the systems that we provide are modular and it can cover a range of different activities but all your typical ones such as air and ocean freight. Uh we do bookings, we do um warehousing and we've also got their their core accounting system. So it is a very sticky product. As I say, it is their their IT backbone and hence why we have 90% retention across both um of those customer categories.

You stated that you're the number one player in New Zealand's shipper segment and number two in Australia. How did Trade Window build that position and what's the path to closing the gap in Australia?

Yeah, we we saw an opportunity uh in our infancy when we were a startup. So the business was only uh established in December 2018 and and went into commercial service January 2020 uh 2020.

And so for us, we we took a leaf out of Wise's book and uh we saw the fastest way to scale up was to acquire existing businesses.

And so January 2020, we acquired a business called Prodoc, which had a a good foothold in the New Zealand market among the the shippers. It had uh many um large enterprise players across dairy, meat, seafood, horticulture, and that really provided us with a lot of early momentum to to be able to pick up further customers within those segments. Uh we serve now I think all of the major players in the in the New Zealand red meat sector

uh and in most of the other um players in in primary industry.

And then we we took that playbook again into Australia and we acquired a business uh that was called High-tech Freight Solutions that had a a product called Cyber freight.

And so that was in April 2021.

And that provided us with a a way of getting into the Australian market and provide momentum. And it's it's really when entering into new market, it was a lower risk strategy because it it provided us with a known quantity in terms of product. It provided us with approximately 250 customers at the time and uh we had uh you know, deep deep knowledge of what customers wanted

through the the the feedback that that um business had had.

And so, yeah, we've been able to build on that momentum and it's taken a lot of the um the heavy lifting out of getting the business up and running.

Now, revenue grew 20% in FY26 while your E loss narrowed. You're now guiding toward near break even in FY27. What's driving that improvement?

Yeah, if we break it down on customer segment by segment. So with the shippers, we've had a strong year across the shippers. We're picking up more customers, so we've got new logos coming on all the time. and as I mentioned earlier, when they come, they stay. Um that segment in particular, that has 95% retention. So the 90% I mentioned earlier is the blended rate across both categories. So very, very sticky.

Um they're also shipping more volume. So what what we're finding is our our customers are are moving more goods, which is great. It's a good uh leading indicator for the economy. Uh and we're the beneficiary of that because our business model is charging on a per shipment basis.

And then for the for the freight forwarders, uh we've made a a conscious move in recent years to move more up market and so we've been focused on winning more what we call mid mid-size freight forwarder, mid-market freight forwarders. And they generally tend to be more sophisticated businesses. They have above uh five users between five typically between 5 to 20 users. Uh and they're faster growing businesses either through organic sales or acquisition.

So they tend to be very sticky. And and that's where we've seen a significant improvement in our average revenue per customer per annum. And so that's gone up uh 19% for the forwarders. It went up 20% for the um the shippers. And I know on the shippers, only 2% of that 20% increase is due to price increases. So yeah, a little bit more of a price increase influence with the with the freight forwarders as we reconfigured our packages to be more suited towards those

mid-market size freight forwarders.

And lastly, you've highlighted that trade window um trades at a fraction of Wise Tech's revenue multiple and you're planning to move your primary listing to the ASX. What's the case for investors today?

Yeah, we wise take aside, they obviously a much larger business and that's just to give the the investors an idea of where we play, but in essence, we we're trading on less than the two times uh multiple of our of our revenue. And so it it doesn't reflect the opportunity ahead of us. We've got that same exciting opportunity as Wise check. It's a growing market. You know, freight and logistics isn't slowing down anytime soon. It's also a a sector that's

very early on on in technology adoption. It's human-centric and that's where we're providing a new solution that's breaking that linkage between the human effort and processing the volume of shipments. And so that's where we see there's there's there's a lot of growth ahead for us. Going back to yeah, other comparable businesses in the market, we've got Yo that's also out there listed on the ASX. They're trading on approximately 150 times multiple and and we're at less than two.

Yeah we've got you know, significant revenues, we're approaching break even, we've got cash in the bank, uh no bank debt. And so we we think that we're in a a solid position, yet the market hasn't really recognized who we are and what we do. Um and that we we present significant upside.

Andrew, thank you for your time.

Thank you.