Dialight Dialight plc AGM April 18th 2012 1 Highlights Dialight • Underlying Profit before tax of £15.1m (2010: £11.3m) – 33.6% Growth • Full year Revenues grew 14.4% to £113.5m (2010: £99.2m) • Signals/Illumination segment revenues increased 29.0% to £78.8m (2010: £61.1m) • Lighting sales more than doubled to £26.3m (2010: £11.6m) • Strong operating cash flow leading to net cash of £13.7m (2010: £10.4m) • Final dividend of 6.7 pence (2010: 5.2 pence) an increase of 28.8% 2 2 2011 Financial Results Dialight £m 2010 EBIT 11.2 Indication Volume – Exceptional Q1 2010 (0.4) Signals & Illumination 10.1 Foreign Currency Translation (0.8) Increased Production Costs – Volume Related (2.1) Development investment and capitalisation (0.4) Investment in Additional Sales & Marketing (2.0) Lower Administration Costs 3 0.4 Increased Bonus Provision (0.7) Other costs (0.2) 2011 EBIT 15.1 3 Revenues 4 Dialight 4 Signals/Illumination ‐ Five Year History 5 Dialight 2011 £m 2010 £m 2009 £m 2008 £m 2007 £m 2006 £m Turnover 78.8 61.1 46.4 43.3 33.4 28.6 Operating Profit 13.8 8.7 3.3 1.7 0.1 (0.5) Return on Sales % 17.5 14.2 7.1 3.9 0.3 n/a % of Group Profit 91.3 77.7 62.2 30.4 2.2 n/a 5 Signals/Illumination Revenue Total £78.8m Contribution % 43.7% 6 Dialight £61.1m 42.2% 6 LED Obstruction Lighting 7 Dialight 7 Signals/Obstruction Dialight • 45% year on year growth versus continued guidance of 30‐50% • Margin improvement driven by new Beacon and Strobe designs • More than 7000 White Strobes supplied to US Cell Tower market since 2007 – 73000 to go – opportunity value $200+m! Only FAA approved supplier • Sales to 9 of the top 10 tower operators now • Introduced High Intensity Strobe for Broadcast/Tall Tower Market 8 8 New Products – High Intensity Strobe Dialight First LED high intensity strobe to market Vigilant™ LED High Intensity Strobe - 270,000 candelas of white light - Towers above 500’ - FAA certified - Replaces unreliable Xenon technology - Reduces massive maintenance costs Scale of opportunity - ~1,800 towers with high intensity systems in US - Average 9 flash heads per tower Total US tower opportunity 9 ‐ $150 ‐ 200M 9 Illumination 10 Dialight 10 Lighting Dialight Lighting • Revenues up over 128% versus guidance of 100% • 75,000+ Industrial White Lights shipped in the year • High Bay Light major success • Sales to many new customers in 2011 • Pipeline of new/improved products • 2012 starting strongly 11 11 Vertically Focused – Hazardous & Industrial Dialight Regulated Primary Markets Oil & Gas Power Gen Mining Chemical Pharmaceutical Water & Sewage Food & Beverage Secondary Markets Manufacturing Warehousing Cold Storage Data Centers 12 12 How big is the market, is the opportunity real? Dialight • Freedonia says Industrial Lighting is approx., $5Bn Annually • We address the installed base which is probably 10 times that size • Hazardous and Heavy is about 20% of that • Dialight has achieved between 0.1 and 0.5% penetration • Major investment in channel expansion Source: Freedonia IMS 2010 Global Industrial Sales: $5.25 billion 13 13 Lighting Sales Force Expansion‐ more than doubled in 12 months Dialight 14 14 Dialight Product Portfolio 15 Dialight’s LED Lighting Fixtures – Broadest in the Industry Linear Fixture Power Consumption: 123‐170W Replaces: 400W HID Energy Savings: 65% Typical Payback: 1‐3 years Power Consumption: 50‐100W Replaces: 200W Fluor Energy Savings: 50% Typical Payback: < 2 years Power Consumption: 80W Replaces: 150W HID Energy Savings: 50% Typical Payback: < 2 years 16 Area Light High Bay Low Bay Dialight Power Consumption: 43‐70W Replaces: 200W Fluor Energy Savings: 50% Typical Payback: < 2 years Wallpack / Bulkhead Power Consumption: 11‐24W Replaces: 70W HID Energy Savings: 70% Typical Payback: 2‐4 years 16 Evolution of Energy Efficient Lighting 17 Dialight 17 Improving our LED High Bay Dialight So how does Dialight provide value to LEDs? Mechanical design / thermal heatsinking Key to longevity of LED fixtures is proper heat management Electrical design Highly efficient universal power supplies built custom for each luminaire, tailored to meet specific certifications, extreme temperatures and rugged environments. LED optical design Concentrate light to the targeted area, rather than wasted on walls, the tops of shelves or into the night sky. Highly durable & efficient lenses Extremely durable lens options for a range of indoor and outdoor applications. 18 18 Dialight LED High Bay Dialight • 60,000+ units – total installed base • Multiple award winning luminaire • Fixture efficiency – 100 lm/W (*industry avg – 77 lm/W) • Mounting options for any application • 200 different variations - Certifications - Lumen output, power consumption - Light distribution patterns - Color temperatures - Voltages - Occupancy sensors - Dimmable *Based on DesignLights Consortium QPL 08/2/2012 19 19 LED Progression Dialight Here’s what we were able to accomplish with our high bay PRESENT 2011 2010 2009 14,000 lumens 12,000 lumens 8,000 lumens 17,000 lumens 100 lm/W 90 lm/W 80 lm/W 53 lm/W 20 20 The Future Dialight • Multi‐Billion Dollar addressable Market in Lighting • Low penetration • Improving paybacks for the customer base as Dialight’s products improve with LED efficiency and internally driven innovation • Lighting Revenues potential to double year on year • Almost $0.5Bn addressable market in Obstruction • Low penetration • Obstruction Revenues potential to grow more than 30% a year 21 21 The Future Dialight Dialight Signals & Illumination Leverage Base % Fixed % Variable % Revenue 100 Direct Material 45% 0 100 Direct Labour 6% 0 100 Sales Commission 2% 0 100 Freight 2% 0 100 45% 0 100 8% 50 50 Contribution Margin Production Cost Gross Margin 37% Development 6% 75 25 Sales & Marketing 9% 0 100 Administration 7% 95 5 EBIT 15% • Operational leverage and maintained/improving contributions will drive the Groups operating Income • Continued doubling lighting through ’14 would triple the size of the Group • £100m Incremental Revenue drives £30m Incremental EBIT 22 22 Dialight Dialight Challenging the status quo in the lighting industry 23