Interim Results 29th July 2008 Financial Highlights z z z z z Turnover increased by 20% to £34.5m (2007: £28.9m) All business segments showing good revenue growth Operating profit up by 104% to £2.0m (2007: £1.0m) Profit before tax up by 68% to £2.1m (2007:£1.3m) Basic EPS of 4.2p (2007:2.5p) Financial Highlights 2008 2007 % z Revenue £34.5m £28.9m 20% z Signals/Illumination £19.0m £14.8m 28% z Electromagnetic components £6.0m £5.1m 18% z Indication business £9.5m £8.9m 6% Signals/Illumination Revenue 2008 2007 z Revenue £19.0m £14.8m z Traffic £10.2m £8.1m z Obstruction £2.0m £1.4m z Transportation £3.8m £3.2m z Lighting £3.0m £2.1m Segment Results Signals / Illumination Revenue 2008 2007 £m £m 19.0 14.8 6.0 4.9 z Contribution z Overhead costs (5.7) (5.4) z Segment result 0.2 (0.5) 31.4% 33.2% Contribution % Segment Results Components Electromagnetic Components 2008 £m 2007 £m Revenue 6.0 5.1 Contribution 1.5 1.2 Overhead costs (1.5) (1.4) Segment results (-) (0.2) 24.7% 23.2% Contribution % Indication Business 2008 £m 2007 £m Revenue 9.5 8.9 Contribution 5.0 5.0 Overhead costs (2.6) (2.6) Segment results 2.4 2.4 52.7% 55.7% Contribution % Summarised Cash flow £m Operating profit 2.0 Depreciation and amortisation 1.1 Working capital (0.6) Pension payment (0.2) Operating cash flow 2.3 Capital expenditure (0.6) Development spend (0.4) Taxation (1.0) Free cash flow 0.3 Movement in Cash £m Free cash flow 0.3 Dividends (1.2) B Shares redeemed (2.0) Own shares purchased (0.2) Interest 0.2 Net cash outflow Opening net cash Translation Closing net cash (2.9) 6.6 (0.2) 3.5 Dividends and Earnings Per Share 2008 2007 z Dividends per share 2.1p 1.9p z Basic EPS 4.2p 2.5p z Dividend cover 1.99 times 1.33 times Segment Revenues 2007 1H Sales (£M) 2008 1H Sales (£M) 6 5.1 14.8 19.9 9.5 Signals/Illumination Indication Disconnect 8.9 Indication Components z z z z z z z Sales up 6% against H1 2007 Distributor Point of Sales up 11% OEM demand up Contribution margin affected by commodity inflation Price increases implemented for H2 Outlook for business is stable given economic conditions Disposal project suspended Electromagnetic Components z z z z z Orders up 19% Sales up 18% US Disconnects continue to be promising Volume shipments to US increasing Targeting further Automatic Meter customers Signals/Illumination H1 2007 £14.8M H1 2008 £19.0M 3.8 3.2 10.2 3 2 Traffic Obstruction Illumination Transportation 8.1 2.1 1.4 Traffic z z z z z 25% Revenue growth year on year Shipments to Miami Dade major influence in H1 European Traffic Sales increase by 40% European customer base increased Price movement offset by cost reduction Obstruction z z z z Revenues increased 40% half on half US Wind Turbine Market strong First White Strobe Sales to Europe Wind Market Solid progress in adoption of White Strobe in North America Obstruction –Opportunity for growth z z z Synchronised Red Beacon - US Wind Turbine installations to run at 1000 Turbines/ year - potential of 2000 Lights per year White Strobe 3 Layer (Europe) - 2000 Turbines/year potential of 4000 Lights per year White Strobe 4 Layer(North America) - over 50,000 lighted Cell Towers in North America on a 10 year replacement cycle - potential 5000 Lights per year Transportation z z z z z Sales increased by 27% half on half Majority sales to US Transit Bus Market Military Vehicle sales $1m Potential for white light for internal illumination Oil price may drive more use of buses? Lighting z z z z z Sales up 40% Growth both sides of Atlantic Agreement signed in UK with Iluma Agreement signed in USA with Juno Lighting Good progress with Industrial White How do LEDs compare to the competition ? (July 2008) Type Efficiency lm/W Life -hours x1000 Cost Per lumen $ Colour Rendering Ra High Pressure Sodium 60 -120 10 - 20 0.0004 30 Ceramic Metal Halide 60 -100 6 -12 0.0010 70 - 95 Fluorescent 40 -100 6 - 45 0.001 60 - 90 Halogen & Tungsten 8 -22 2 - 10 0.0002 100 Cool white LED 6000k 60 -100 50 0.02 70+ Warm white LED 3000k 40 - 50 50 0.03 75 -90 Rapid Improvement in White LEDs White Lighting z z z z z z z z z Introduced “Safesite” Hazardous Location Downlight H2 07 Designed to replace 150 watt High Intensity Discharge Light Installed base $250m plus for Refinery Market H1 Sales in line with plan Strong value proposition for both Hazardous and “Rugged” Markets Over 40% Power Saving Longer life - 5 year warranty Sealed for life concept Shock and Vibration resistant Safesite- what is the advantage? Break the Paradigm! Efficiency? Typical 150W HID HL 16000 4310 Lamp/LED Output (lumens) 7349 3344 Fixture Output (lumens) 3707 3217 Target Area Illumination (lumens) 167 z Dialight SafeSite™ LED C1D2 95 Power (watts) 39 35 Fixture Efficiency lumens/watt) 22 34 Target Area Efficiency (lumens/watt) Directional nature of LED’S mean more efficient light delivery to target area. Inefficient Light Fixture! Sharp beam- no pollution/no wasted light Wasted Light! “Rugged” Safesite Application Lights on during the daytime! Who is there to see these lights? Continued Strategy z z z z z z Identify sizeable regulated markets with potential LED value proposition Bring technology to bear along with improving LED performance and cost Look at different ways to manage light Qualify product to difficult market regulation Register IP where possible to protect the future Work with End Users/OEMs to drive adoption