Lantronix, Inc. · NASDAQ:LTRX
Lantronix — Merriman Investor Summit (February 2012)
24 slides from Lantronix's conference presentation, Feb 1, 2012
Slide 1: Investor Presentation - Merriman Investor Summit
Investor Presentation Lantronix (NASDAQ: LTRX ) Kurt Busch , President & CEO Jeremy Whitaker , CFO Merriman Investor Summit February 1, 2012
Slide 2: Safe Harbor
Page 2 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Safe Harbor This presentation contains forward - looking statements, including statements concerning financial results, anticipated market growth, market size, market vision, product features and availability timing, competitive assessme
Slide 3: About Lantronix
Page 3 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . About Lantronix (NASDAQ: LTRX ) Global leader in the design, manufacture and sale of secure connectivity solutions for machine - to - machine (M2M) local or internet communication • 3 million+ Lantronix devices currently deployed (in - m
Slide 4: World Class Global Customer Base
Page 4 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . World Class Global Customer Base Security Industrial Automation IT / Data Center Medical Energy Over 3 million devices connected
Slide 5: Lantronix: Investment Highlights
Page 5 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . • Strong new, energized management team with M2M and communications expertise • 20 years of company experience allows us to aggressively expand into new markets • Focused on execution – Financial – Product development and market growth •
Slide 6: M2M Market - What is all the excitement about?
Page 6 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . 7.8 Billion People 65% Market Saturation 50 Billion Connectable Machines 1% Market Saturation M2M Market - “What is all the excitement about?” “5 billion mobile phone subscribers today will be surpassed by 50 billion connected non - phon
Slide 7: M2M Ecosystem: Connecting Machines to Machines
Page 7 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Wired Wireless Cellular* Sensor* M2M Ecosystem . . . Connecting Machines to Machines to Help People Do More * Future Products
Slide 8: Lantronix Value Proposition
Page 8 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Lantronix Value Proposition CONNECT: platform - independent, anywhere M2M communications that puts you in control SMART: our smart devices make it easy to securely network your products DO MORE: find out what you need to know, when you n
Slide 9: Growth Strategy
Page 9 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Growth Strategy Capitalize on trends in the M2M connectivity market by leveraging our existing platforms to expand addressable markets and gain share in current segments • Expand TAM by introducing innovative new products and organizing
Slide 10: Current Products: Device Enablement and Device Management
Page 10 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Device Enablement Device Management Current Products • Simple and cost effective serial - to - Ethernet bridging, industrial, commercial, wired and wireless FY 11 Revenue: ~ $39.6MM Product refresh planned for CY 2012 • Manage multiple
Slide 11: Near Term Product Roadmap - Cellular and Sensor
Page 11 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Near Term Product Roadmap – 2H CY 12 Cellular Sensor • Pervasive machine connectivity • Securely manage remote and mobile machines • Network enable sensors • Enables decisions based on the response of physical stimulus (heat, light, sou
Slide 12: Recent New Product: xPrintServer Network Edition
Page 12 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Recent New Product: xPrintServer ™ – Network Edition First New Product Initiated by New Management xPrintServer – Network Edition • CONNECT: – Designed specifically for anyone in a networked printer environments – Print wirelessly from
Slide 13: xPrintServer - What The Experts Are Saying
Page 13 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . xPrintServer ™ – What The Experts Are Saying “Lantronix’ xPrintServer overcomes Apple's printer gap, with amazing simplicity…the xPrintServer made me giddy with glee.” “ It's truly plug - and - play. And it just works… That bears repeat
Slide 14: Accelerate Growth: Expanding Lantronix TAM
Page 14 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Accelerate Growth: Expanding Lantronix TAM New Products Plans Expand Estimated TAM by over 4x New - xPrintServer New - Sensor and Cellular Device Enablement Refresh - Device Management Current - Wired and Wireless Device Enablement Sour
Slide 15: Turnaround Progress: First Days
Page 15 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Turnaround Progress: First 150 Days… • New CEO and CFO appointed; • Recruited and retained experienced management team with strong background in M2M and communications technologies; • Developed strategy to expand market share as well as
Slide 16: Leadership Team
Page 16 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Leadership Team Jeremy Whitaker , Chief Financial Officer * • Former Lantronix Vice President of Finance, returned to join turnaround • Broad perspective with both outside auditor (Ernst & Young) and internal finance and accounting expe
Slide 17: Income Statement Information
Page 17 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Income Statement Information Fiscal Year Ended June 30 $ in Millions FY 2010 FY 2011 FQ1 2012 Net Revenue $46.4 $49.3 $11.2 Y/Y Change (5.6%) 6.4% (8.3%) Gross Profit $24.1 $24.4 $5.3 % of Revenue 52.0% 49.5% 47.4% Operating Expenses $2
Slide 18: Balance Sheet Information
Page 18 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Balance Sheet Information Fiscal Year Ended June 30 $ in Millions FY 2010 FY 2011 FQ1 2012 Cash and Cash Equivalents $10.1 $5.8 $4.0 Accounts Receivable, Net $1.3 $2.9 $2.1 Inventory, Net $6.9 $9.2 $9.3 Total Current Assets $20.4 $19.7
Slide 19: The Turnaround: Stabilizing the Company
Page 19 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . The Turnaround: Stabilizing the Company Stabilize Working Capital • Restructuring o Expected to save ~$2M per year o Expenses at the BoD and named executive officer level reduced by ~$350K / year o Reduce spending on outside services o
Slide 20: Improve Gross Margins
Page 20 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Improve Gross Margins Working to return margins to historical range of 49% to 51%
Slide 21: Financial Discipline: Reduce Non-GAAP Breakeven Point
Page 21 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Financial Discipline: Reduce Non - GAAP Breakeven Point Cost savings measures and margin improvements to enable a corporate non - GAAP breakeven target below $11MM (1) Please see Appendix A to this presentation for a reconciliation of n
Slide 22: Lantronix: Summary
Page 22 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . • Strong new, energized management team with M2M and communications expertise • Over 20 years of company connectivity experience allows us to aggressively expand into new markets • Focused on execution – Financial – Product development
Slide 23: Thank You
Page 23 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . THANK YOU • For more information, email us at investors@lantronix.com • Please join us for our next quarterly conference call on Thursday, February 9 @ 5PM EST.
Slide 24: Appendix A: Reconciliation of Non-GAAP Measures
Page 24 | Investor Presentation Feb 1, 2012 © 2012 Lantroni x . Appendix A: Reconciliation of Non - GAAP Measures Q110 Q210 Q310 Q410 Q111 Q211 Q311 Q411 Q112 2010 2011 GAAP net income (loss) (499)$ (375)$ (136)$ (509)$ (678)$ (579)$ (399)$ (3,615)$ (1,444)$ (1,519)$ (5,271)$ Non-GAAP adjustments: C