I attended the $WTC Investor Day today, which focused on the new products: Compliance Wise, Cargowise Next, and Container Transport Optimisation (CTO). But, as importantly in the light of recent events, the day provided the opportunity to see key members of the broader management team.There was a lot to absorb today, and I don’t have the energy to summarise all the insights of the day. So will rather share a few top level impressions.

The $WTC bench of leaders are impressive, particularly in their longevity with the company and/or how leaders of historical acquisitions have integrated effectively into the business (and by this I mean not just as heads of their former businesses, which over time get full subsumed by Cargowise and related products, but as leaders of overall functions within $WTC).

We saw about 10 leaders across products, technology, sales, and finance. If I was to single one out, I was very impressed with Acting CFO Caroline Pham. She facilitated several of the sessions, demonstrated she was across all areas of the business, and is a phenomenally clear communicator. Very impressive. But then again Brett Shearer (CTO and Chief Architect, with $WTC since 1994), John Pritchard (Product Development, since 2019), and Vlad Bilanovsky (Chief Execution Officer) were all impressive. Too.

It is also clear that there is a powerful and high performing culture in $WTC ("Creedo" and "Mantras") that truly govern/shape how people behave and decisions are reached.

But it was the closing panel when Richard White came back on-stage and in some of the excellent questions, that clearly demonstrated that this is a company whose evolution is still being guided forward by his vision for the roadmap to creating the operating system for global logistics. And that’s not a just slogan, as it was clear in many of the questions and answers that this is a vision that the entire leadership team is focused on turning into a reality. It is a massive under-taking, and there are decades to run, but the belief that they will succeed and in their strategic differentiation is palpable.

At the very end of the session, I felt I got some insights into the delayed launch of CTO and the adjustment to guidance. When CTO goes live it will be with a limited scope – focused in the market around Sydney, with one optimisation (out of “10”) turned on, before being extended to the East Coast of Australia and then the West Coas of the US. In my view, this alone was never going to account for the adjustment in guidance that was recently announced. No way! Which leads me to conclude several things: 1) that $WTC got ahead of itself in issuing the initial FY25 (my hypothesis when I exited several months ago); 2) that there have been an accumulation of delays in new product launches over the last years; and 3) that the process of scoping what goes in the “go live” version has been progressively descoped to ensure that they launch a product that works.

The forces at work here were all set in train under RW’s watch, with at most a month or two of a drag on senior decision-making on key go-no-go decisions during the recent media circus. That was because these decisions involved descoping and delays – decisions which only the CEO can ultimately take.

Again, in my view, this is all a manifestation of the inevitable tension that exists between the visionary CEO, and the ability of the team to deliver. I’ve seen it before elsewhere, and after today’s sessions I am even more convinced than before the meeting that this is what’s at play at $WTC. Frankly, it would be better if they didn’t give guidance, because the tension in itself is not a negative thing. Not having guidance would leave the team free to work out these issues without having to recalibrate external expectations.

Having made these somewhat negative remarks, it is clear that the three new products will ultimately drive significant future value. If CTO gets traction in the market, it could be as big as Cargowise.

From today, Richard sees himself fully unleashed from management and governance tasks to develop the roadmap, the product, and key customers engagements to bring his vision to reality. If there is a risk, it is that without being accountable for promises made to the market, the tension between driving $WTC to implement his vision, and the reality of updating shareholders on guidance expectations may well be something that emerges from time to time. We should not be surprised when it does. That is the consequence of ambition.

Without seeing the specifics, we also got clear insights into the existence of work on material future product innovations, that will extend long into the future.

Valuation

I need to go away and look at my valuation.

I believe that there is a near term risk that an inevitable maturing of Cargowise revenue growth may coincide with a gap as delayed new products ramp up. This creates the possibility that if the market can’t see through this, that I will get a re-entry point for $WTC. i.e., the market recalibrates to a slightly softer FY25 projecting that forward, with then growth recharged in FY26 and FY27 and new product sales kick in. Something to mull over.

I haven't decided what this means for my reinvesting for $WTC. There is more work to do over the summer.

Looking back at the deep dive I did a couple of years ago, I estimated that $WTC in 2019 held about a 1% share of the global market for logistics and supply chain software. I also estimated that my valuations were based on this growing to between 6-9% by 2042.

I think I need to go back and look at some of those assumptions, following today’s presentation. I might be doing $WTC a disservice.

Disc: Not currently held, but that's likely only temporary