Slide 1: Fiscal Third Quarter 2024 Results Call
DYNAMIC MESSAGE SIGNS Fiscal Third Quarter 2024 Results Call February 28, 2024 NASDAQ: DAKT CONTROL SYSTEMS
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT In addition to statements of historical fact, this presentation contains forward-looking statements 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 Compa
Slide 3: Fiscal Third Quarter 2024 Highlights
FISCAL THIRD QUARTER 2024 HIGHLIGHTS Drove profitability and generated operating cash flow in an historically loss quarter • Execution drove positive operating income, delivering profitability in a seasonally low-volume period despite lower volume compared to last year’s surge of backorder fulfill
Slide 4: FQ3 FY2024 Financial Highlights
FQ3 FY2024 FINANCIAL HIGHLIGHTS ($ in millions, except per share data) Orders (1) Net Sales Gross Margin Operating Margin(2) F2024 F2023 F2024 F2023 F2024 F2023 F2024 F2023 $192 $185 $170 $148 24.5% 22.6% 4.7% 3.8% +29.4% -7.9% +190 BP +90 BP ($ in thousands, except per share data) FQ3 2024 FQ3 2023
Slide 5: YTD FY2024 Financial Highlights
YTD FY2024 FINANCIAL HIGHLIGHTS ($ in millions, except per share data) Orders (1) Net Sales Gross Margin Operating Margin (2) F2024 F2023 F2024 F2023 F2024 F2023 F2024 F2023 $602 $534 $544 $501 27.7% 11.2% 18.2% 0.6% +6.6% +10.6% +950 BP +1060 BP ($ in thousands, except per share data) YTD 2024 YTD
Slide 6: Market Vertical Update
MARKET VERTICAL UPDATE Live Events International • Detroit Tigers/Comerica Park • Stadium and Transportation • FQ3/YTD Orders +56% / +17% • FQ3/YTD Orders -53% / -4% • Updating to entertain fans, • Economic impacts in OOH space attract athletes Commercial High School Park and • Spectacular and OOH r
Slide 7: Strategic Focus – Market Penetration and Development
Strategic Focus – Market Penetration and Development Capturing growth in SAM: • Expand share of customer spend • Add new customers • Add control system, sports data, and content development MRR where applicable Develop growth opportunities: • NPP – applicable in all segments • International – drive
Slide 8: Frequently and Recently Asked Questions
Frequently and Recently Asked Questions Questions What we are doing Why we don’t give guidance today – Investing in manufacturing processes and systems to increase control, ability to be • Large-project-driven, lumpy business responsive to changing conditions as • Highly seasonal complexity rises
Slide 9: Frequently and Recently Asked Questions
Frequently and Recently Asked Questions Questions What we are doing What is managements compensation Focused on strategies described previously – structure? capturing profitable SAM which drives • Management’s incentive operating profits, developing best in class solutions, and managing expenses.
Slide 10: FQ4 2024 Qualitative Outlook
FQ4 2024 Qualitative Outlook • Seasonality is expected to be similar to pre-pandemic patterns. • Net sales expected to increase sequentially from Q3 and decrease from the year-ago Q4 high backorder period • Gross margin is expected to be similar in comparison from the unique 2023 fourth quarter and
Slide 11: Summary
Summary • Year-to-date results serve as evidence that we have overcome the past years’ operational challenges • Global industry leader in best-in-class video communication displays and control systems • Only US manufacturer of scale with a global footprint and servicing by geographic market • Techno
Slide 12: Appendix
APPENDIX Lusail Boulevard – Saudi Arabia
Slide 13: Net Sales and Orders by Business Unit
NET SALES AND ORDERS BY BUSINESS UNIT ($ in thousands) (1) Orders and backlog are not measures defined by accounting principles generally accepted in the United States of America ("GAAP"), and our methodology for determining orders and backlog may vary from the methodology used by other companies in
Slide 14: Reconciliation of Free Cash Flow
RECONCILIATION OF FREE CASH FLOW (1) ($ in thousands) (1) In evaluating its business, Daktronics considers and uses free cash flow as a key measure of its operating performance. The term free cash flow is not defined under accounting principles generally accepted in the United States of America ("GA
Slide 15: Reconciliation of Adjusted Operating Income
RECONCILIATION OF ADJUSTED OPERATING INCOME ($ in thousands) (1) In evaluating its business, Daktronics considers and uses adjusted operating income as a key measure of its operating performance. The term adjusted operating income is not defined under GAAP and is not a measure of operating income, c
Slide 16: Reconciliation of Adjusted Net Income (Loss)
RECONCILIATION OF ADJUSTED NET INCOME (LOSS) ($ in thousands) (1) Adjusted net income. We disclose adjusted net income as a non-GAAP financial measurement in order to report our results exclusive of items that are non-recurring or not core to our operating business. We believe presenting this non-GA
Slide 17: Reconciliation of Long-Term Debt
RECONCILIATION OF LONG-TERM DEBT ($ in thousands) (1) Adjusted net income. We disclose adjusted net income as a non-GAAP financial measurement in order to report our results exclusive of items that are non-recurring or not core to our operating business. We believe presenting this non-GAAP financial
Slide 18: Technology
DYNAMIC MESSAGE SIGNS Technology CONTROL SYSTEMS