Slide 1: Third Quarter Fiscal 2019
THIRD QUARTER FISCAL 2019 NASDAQ: DAKT
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT In addition to statements of fact, this presentation contains forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995 and is intended to enjoy the protection of that Act. These forward-looking statements reflect the company’s expectations or b
Slide 3: Daktronics Vision
DAKTRONICS VISION To be the world leader at informing and entertaining audiences through dynamic audio-visual communication systems.
Slide 4: Daktronics Mission
DAKTRONICS MISSION Deliver industry leading value to our customers, by engaging: • our employees through challenging and rewarding opportunities; • developing strategic partnerships with our suppliers; • leveraging our strengths in: product innovation, manufacturing, and service; • while contributin
Slide 5: Around the Globe
: Sales Office : Manufacturing Facility Products in 120+ Countries OFFICES throughout the world AROUND THE GLOBE
Slide 6: World Leader
WORLD LEADER Celebrating our 50th Year! Customer solutions Engineering & Creative talent Global and local focus of customer support Lean Manufacturing Financially strong
Slide 7: 10 Year History Sales & Operating Income %
10 YEAR HISTORY SALES & OPERATING INCOME %
Slide 8: 10 Year History Free-Cash Flow
10 Year History Free-Cash Flow* FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 Net cash from operations $ 48,731 $ 43,784 $ 41,346 $ 20,038 $ 50,749 $ 36,199 $ 54,702 $ 13,354 $ 39,370 $ 31,613 Net capital expenditures (18,221) (15,940) (9,148) (16,293) (9,476) (13,281) (24,83
Slide 9: 10 Year History Return to Shareholders
10 Year History Return to Shareholders Total Regular Annualized Special Fiscal Dividend Dividend/ Dividend Dividend/ Long-term dividend history Year Share Yield Share Payout (see chart to the right) (000’s) 2010 0.095 1.2% - 3,874 2011 0.100 2.5% 0.500 24,795 Share Repurchase program 2012 (1) 0.
Slide 10: More about Daktronics
More about Daktronics 52/53 Week Fiscal Years ending in April 10 YEAR HISTORY DILUTED EARNINGS PER SHARE Seasonality to results (Sports/Construction (after adjustment for splits) season) Fiscal Year Q1 Q2 Q3 Q4 2010 + 0.03 + 0.12 - 0.20 - 0.12 Video systems comprise a large portion of 2011 + 0
Slide 11: FY2019 Third Quarter Results
FY2019 THIRD QUARTER RESULTS ($ in thousands, except per share data) Three Months Ended 26-Jan 27-Jan Percent 2019 2018 Change Orders $ 135,429 $ 126,153 7.4% Net sales $ 115,068 $ 130,316 -11.7% Gross profit 24,869 28,567 Gross margin 21.6% 21.9% Operating income (7,522) (3,338) -125.3% Operating m
Slide 12: FY2019 YTD Results
FY2019 YTD RESULTS ($ in thousands, except per share data) Nine Months Ended 26-Jan 27-Jan Percent 2019 2018 Change Orders $ 446,395 $ 421,494 5.9% Net sales $ 441,949 $ 472,353 -6.4% Gross profit 105,873 115,817 Gross margin 24.0% 24.5% Operating income 5,537 17,826 -68.9% Operating margin 1.3% 3.8
Slide 13: FY2018 Annual Results
FY2018 ANNUAL RESULTS ($ in thousands, except per share data) Twelve Months Ended 28-Apr 27-Apr Percent 2018 2017 Change Orders $ 583,467 $ 613,504 -4.9% Net sales $ 610,531 $ 586,539 4.1% Gross profit 145,669 140,415 Gross margin 23.9% 23.9% Operating income 12,460 15,421 -19.2% Operating margin 2.
Slide 14: Business Unit Recap
Business Unit Recap Live Events, Commercial, FY18 Net Sales Transportation, and High School Park International Commercial and Recreation, include net sales in 15% 22% the United States and Canada Transportation 10% International net sales include rest of world and are primarily for solutions for
Slide 15: Live Events Business Unit
LIVE EVENTS BUSINESS UNIT Colorado Rockies
Slide 16: Live Events
LIVE EVENTS » Video display solutions for large sports venues and live entertainment facilities • Professional sports • College and university • Arenas University of South Carolina » Competition • Mitsubishi, Lighthouse, Panasonic, Prismview and others • Asian competition through U.S. integrators
Slide 17: Live Events: Demand Drivers
LIVE EVENTS Demand Drivers » Facility increased spend to: • Enhance attendee event experience • Revenue source from advertising • Competitive nature to outperform other facilities » Lower product costs, driving expansion of marketplace » High definition product offering (HD) » Replacement cycle (sys
Slide 18: High School Park and Recreation (HSPR)
HIGH SCHOOL PARK AND RECREATION (HSPR) Highlands Ranch High School, Highlands Ranch, CO
Slide 19: HSPR
HSPR » Video and scoring systems and message centers to • Elementary and high schools, junior colleges • Park and recreation departments » Primary funding is through local sponsors and advertisers North Judson High School, North Judson, IN
Slide 20: HSPR
HSPR »Growth Drivers • Larger more sophisticated displays in sports venues • Revenue generation • Communication medium • New construction/replacement cycles »Competitors • Formetco, Scorevision, Translux, Nevco, Midco Aquatics Center, Sioux Falls, SD other smaller company manufacturers
Slide 21: Commercial Business Unit
COMMERCIAL BUSINESS UNIT Walgreens, Pinal County, AZ Oglethorpe Mall, Savannah, GA
Slide 22: Commercial
COMMERCIAL » Sales channel focus • Third party advertising/Out of Home Advertising (OOH) • On-premise advertising (retail) • Spectacular (custom video) » Primary offerings EZStor, Watertown, SD • Digital billboards • Message centers • Video display systems/display walls • Petroleum displays • Dynami
Slide 23: Commercial
COMMERCIAL » Long-term growth drivers • Market adoption, including National Accounts • Spectacular use to entertain/advertise in unique locations • Effective advertising medium (outdoor and indoor networks) • Replacement cycle (7-10 years) • Architectural lighting » Competitors • Message Centers – O
Slide 24: Transportation Business Unit
TRANSPORTATION BUSINESS UNIT Airports Tom Bradley Terminal Los Angeles International Airport Nevada Department of Transportation
Slide 25: Transportation
TRANSPORTATION » Three niches • Intelligent transportation systems (ITS) • Airports • Mass Transit » Competitors • Skyline, Ledstar, Telegra, SES-America, Imago, others Intelligent Transit Systems (ITS) Banff National Park – Parks Canada
Slide 26: Transportation
TRANSPORTATION » Long-term growth drivers • Transportation management - increasing traffic demands on constrained infrastructure • Governmental funding and investment in infrastructure projects • Infographic communication • Advertising needs Seattle International Airport Public Transportation Anahei
Slide 27: International Business Unit
INTERNATIONAL BUSINESS UNIT Piccadilly Lights, London
Slide 28: International
INTERNATIONAL Main products » Commercial video systems » Sports video systems » Digital billboard (OOH) » Architectural lighting » Transportation systems Infrastructure » World-wide sales & service offices » International Manufacturing facilities: Mosaic Shanghai • China- architectural lighting and
Slide 29: International
INTERNATIONAL » Growth opportunities • 3rd party advertising/Out of Home Advertising • Live Events facilities/sports • European/Middle East transportation systems • Increased geographical coverage Galleria Tbilisi, Georgia » Competitors: Absen, Samsung, Aoto, Leyard, Unilumen, Mitsubishi, Lighthouse
Slide 30: Looking Ahead
OLUMBMS HI it 7 e oct wish list. DAKTRONICS
Slide 31: Achieving Long-Term Profitable Growth
ACHIEVING LONG-TERM PROFITABLE GROWTH Continued Global Demand Continued global market adoption and expansion Retail and public space Out of Home Advertising Venue competition/ HD video for sports Replacement cycle Worldwide economic conditions
Slide 32: Achieving Long-Term Profitable Growth
ACHIEVING LONG-TERM PROFITABLE GROWTH Daktronics provided robust solutions meeting market demand: New product and solutions introductions: Localized and customer focused products Narrow Pixel Pitch (Ultra-high resolution) solutions Enhanced product and control system platforms Professional s
Slide 33: Outlook to Fiscal 2019
OUTLOOK TO FISCAL 2019 Modest order growth International OOH, transportation, market development Commercial indoor solutions expansion, spectacular demand, replacement cycles, OOH similar demand levels Transportation opportunity for growth with funding/mass transit/advertising HSPR continued
Slide 34: Solution Examples
SOLUTION EXAMPLES Total Event Control An integrated di jay control studio all ‘or flexible, intuitive display control and event management. Content Compositing ul content compositing tools users to create broadcast- quality presentations. MODULE COMPARISON orouciceys. surracemounr tes | } THROUGH-HO
Slide 35: Technology
DYNAMIC MESSAGE SIGNS TECHNOLOGY CONTROL SYSTEMS
Slide 36: Questions
Slide 37: 10 Year History Supplemental Information
10 YEAR HISTORY SUPPLEMENTAL INFORMATION