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SLI Systems Highlights Growth Potential

SLI Systems Highlights Growth Potential with Existing Capital at AGM

Expects changes in sales and marketing to positively impact 2017 calendar year

CHRISTCHURCH, New Zealand – November 4, 2016 – SLI Systems (SLI.NZ), a global leader and provider of e-commerce services for mid-to-large Internet retailers and B2B sites, today reiterated it was well funded and that restructuring initiatives to restore growth were on track.

The company also highlighted its strong growth in operating revenue in the 2016 financial year, up 24.5% to $35.0 million from $28.1 million in the prior year.

SLI was cash flow positive for the 2016 financial year with net cash on hand of $6.8 million, after recording a net cash inflow for the year of $1.2 million – a record performance since the IPO in May 2013.

Speaking at SLI’s Annual Shareholders Meeting Chairman Greg Cross said the company’s strengthening financial position reflected disciplined execution in a significant narrowing in loss before tax in the 2016 financial year to just $200,000 from $7.6 million in 2015. “The significantly reduced loss is a result of increased revenue earned from our customers and the careful management of our cost structure. We do not need to raise additional capital to achieve our growth plans,” Mr Cross said.

SLI’s strong operating revenue growth in the 2016 financial year was highlighted in a step up in SLI’s ranking in the Technology Investment Network (TIN) 100 survey of New Zealand’s largest technology companies. SLI was ranked 53rd in the 2016 survey, up 9 places from its position in the 2015 survey.

“Constant currency Annualised Recurring Revenue (ARR) at the end of the 2016 financial year was $31.2 million, 3% lower than the June 2015 position. This recurring revenue has a gross margin of 77% an improvement from 74% in the prior year. Not growing our ARR was disappointing and we have made changes to address the issues that we saw in the business,” Mr Cross said.

“The transition of the sales organisation is now largely complete. We have hired a new experienced Chief Revenue Officer and have implemented new sales models based on inside selling and best practise Software as a Service (SaaS) processes. We have rebuilt the sales team and we are appropriately staffed for our new sales approach.

“The change in the marketing operation is still in process and we would expect to see the benefits of this in calendar year 2017.

Mr Cross said “While we can all be disappointed at SLI’s recent share price performance we remain focused on returning to growth and believe that once we achieve that goal the market will reward that performance.

“Looking ahead, we continue to focus on new product innovation as it is a core component of our strategy

and is key to competitive differentiation. We were recently awarded a US patent for Rich Auto Complete – now an industry standard feature that we pioneered.

“We see there is significant market opportunity and continue to be optimistic about the potential for SLI,” Mr Cross concluded.

About SLI Systems

SLI Systems (SLI.NZ) accelerates e-commerce for the world’s top retailers by generating more traffic, converting shoppers into buyers and maximizing order values through solutions that improve site search, navigation, mobile, merchandising, personalisation, recommendations and SEO. For 15 years, established brands have trusted SLI Systems to deliver innovative features and knowledgeable service, and SaaS-based infrastructure to delight customers and increase revenue. The SLI Buyer Engine combines user behavior and machine learning to accurately predict what shoppers are most likely to buy, shortening the path to purchase. The SLI Control Center™ organizes key sales insight and tuning capabilities into one easy-to-use console. SLI is the most chosen cloud-based site search provider to U.S. Internet Retailer Top 1000 retailers. The company operates on five continents, powering more than 800 websites and offering solutions in 20 languages. For more information, visit www.sli-systems.com.

# # #

Connect with SLI:

Twitter – twitter.com/slisystems
Facebook – facebook.com/slisystems
LinkedIn – linkedin.com/company/sli-systems

SLI_AGM_Presentation.pdf

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