Itex Corp. · OTC:ITEX
Itex — Investor Presentation (February 2013)
31 slides from Itex's investor presentation, February 2013
Slide 1: ITEX Investor Presentation
¢ / ITEX INVESTOR PRESENTATION
Slide 2: Forward-Looking Statements and Solicitation Materials
Forward-Looking Statements and Solicitation Materials ITEX Corporation urges caution in considering its current trends and any outlook on earnings disclosed in this communication. In addition, certain matters discussed may constitute forward-looking statements. These forward- looking statements invo
Slide 3: About ITEX
About ITEX Symbol ITEX.OB Recent Price $3.50 52 Week Range $2.96 - $4.55 Shares Outstanding 2.95 M* Market Capitalization $10.3 M Insider Ownership 23% Fiscal Year End July 31 Revenue - 2012 $15.8 M Revenue - 2011 $16.4 M Cash Flow From Operations - 2012 $1.9 M Cash Flow From Operations - 2011 $1.7
Slide 4: Cashless Exchange Industry
Cashless Exchange Industry • $680 M transaction value via local exchanges • $ 56 M in cash revenues • 300 exchange locations • Fragmented industry • 90,000 member companies • ITEX has 27% market share • IRS codified tax treatment in 1982 and requires 1099-B reporting Source – Estimates based on ITEX
Slide 5: ITEX Overview
ITEX Overview • Largest membership B2B Trading Community in the United States and Canada* • 23,500 members • Customer service provided by franchised Broker Network • Enable members to attract new customers and generate incremental sales • Members buy and sell within the Trading Community utilizing p
Slide 6: Craigslist Barter Section
Craigslist Barter Section • Saturday, October 14 • 12 chocolate on chocolate cupcakes in antioch - (pittsburg / antioch) • Need keys for your Car..House..office ect - • A-1 Cabinet Maker/Remodel/Repair/New/Vanity Master - $1 - (santa rosa) • Kettle One Citroen - (mission district) pic • machanic for
Slide 7: Craigslist Barter Listing
Craigslist Barter Listing • Canon 40D, like new + 2GB compact flash (Renton) • Reply to: ###@craigslist.org Date: 2012-010-14, 1:02PM PST I'd like to trade my year and a half old Canon 40D body. Like new condition. Always kept in a Crumpler bag, no scratches, etc. Includes box, manuals, battery, cha
Slide 8: ITEX Marketplace Listing
Search My Account About Us Contact Us Brokers Search Both Marketplace Ads Member Businesses Featured Ads What Where MIAMI BEACH FL 33140 search | Recent Ads Want Ads Featured Listings Browse Local Directory * Accommodation & Travel nas reece erent * Advertising 7 * Animals & Agriculture * Art & Anti
Slide 9: Marketplace Detail
Marketplace Detail Home Search My Account Ab Us Contact Brokers << Return Search © Best Western - White House Inn Featured Ads Recent Ads Contact Information Listings Menu Want Ads Terri Smiei erm omieja + Ask the seller a question Local Directory BEST WESTERN HOTELS * Contact Seller's Broker Our Me
Slide 10: ITEX Member Benefits
ITEX Member Benefits • Obtain new customers • Utilize unique sales channel • Cash conservation by purchasing with ITEX dollars • Monetize unproductive assets, excess capacity and inventory • Broker Network for transaction support • Customer loyalty and retention 10
Slide 11: ITEX Community in Action
ITEX Community in Action Media Purchases hotel accommodations for sales promotions and business cards and stationery from a printer. Resort Hotel Hires contractors to expand and upgrade their facilities. General Contractor Trades for dental services for staff and purchases direct mail advertising, F
Slide 12: Member Example - Seattle Dentist
Member Example - Seattle Dentist Accepted ITEX $ from: Paid ITEX $ for: • CPA • Printing • Contractor • Auto detail • Advertiser • Flowers • Moving Company • Accommodations Total Sales: $47,367 Avg. Transactions: 22 Total Purchases: $41,559 Avg. Volume: $9,814 Total Cash Fees: $ 6,289 Avg. Client: 6
Slide 13: ITEX Competitive Advantages
ITEX Competitive Advantages • Membership critical mass • Multi-office Broker network • Customer service capability • Products / services depth and diversity • Brand recognition and transaction liquidity • Web-based trading platform • Established infrastructure 13
Slide 14: Transaction Methods
Transaction Methods 2) Online Capability 3) Automated Authorization Line – 1.800.426.5777 14
Slide 15: Member Statement
9326 160th Ave. SE STATEMENT ITEX Contact: JOHN Q. CITIZEN WORLDWIDE MARKETING 123 BUSINESS DRIVE SACRAMENTO, CA 95825 SUMMARY OF TRANSACTONS RETAIN THIS STATEMENT FOR TAX PURPOSES AGCOUNT NUMBER 502172-123456-0 Your Trade Director is Bob Smith - Phone: 916.679.1111 Payment is due upon receipt of th
Slide 16: Member Products & Services
Member Products & Services • Accommodation & Travel • Retail – gifts, florists • Advertising & Media* • Architects & Design • Business Products/Services* • Consultants • Contractors • Restaurants • Professional Services • Entertainment* • Business Equipment • Printing • Real Estate & Related • Magaz
Slide 17: ITEX Strategic Objectives
ITEX Strategic Objectives • Establish the ITEX trading platform as the standard for B2B cashless transactions • Market penetration into the 26 million small businesses in the United States* • Brand recognition of ITEX dollars • Enhance, create and administer Marketplace Rules for the Trading Communi
Slide 18: ITEX Growth Opportunities
ITEX Growth Opportunities • Organic Growth • Increase transaction volume via registration growth • Increase number of locally-owned offices • Supplement primary franchise system with online marketplace • Acquisitions • Eight trade exchange membership lists since 2005, with plans for more 18
Slide 19: Testimonials
Testimonials "ITEX has helped me connect with the exact customers we want -from Florida to California - that we wouldn't have had any other way. ITEX has also helped us pay for real business expenses with ITEX dollars instead of cash." - Nick Owner of a commercial printing business "Not only have we
Slide 20: Discover an innovative way to survive
Discover an innovative way to survive “Trading products and services is the PERFECT way to increase sales and improve your bottom line.” - Steven White, CEO, ITEX Corporation With the current economic uncertainty, your business can use barter to attract new customers and retain current ones. /TEX —
Slide 21: Fiscal Years 2003-2012 Revenue
q q q q q 18,000 16,000 14,000 12,000 10,000 | Fiscal Years 2003-2012 Revenue 2003 2004 2005 +2006 ~«2007 «2008 ~=«009»« 2010201012 $10,595 $10,283 $10,225 $14,646 $14,171 $15,964 $16,502 $16,925 $16,424 $15,786 21
Slide 22: Revenue Breakdown and Costs
Revenue Breakdown and Costs • Transaction fees: 67% • 5% to 7.5% of ITEX dollar transaction amount (assessed to buyer and seller) • ITEX retains 25%, balance to Broker • Subscription fee: 30% • $20 per member every four week billing cycle • ITEX retains 65%, balance to Broker • Other fees: 3% 22
Slide 23: Cash Flow & Income From Operations
Fiscal Years 2003-2012 Cash Flow & Income From Operations 2003 = 2004 = 2005) 2006 )9 2007. | 2008S 009s Nt NTS 012 CashFlow $(74) $28 $843 $1,836 $2,057 $2,374 $2,875 $2,536 $1,684 $1,893 Income $642) $621 $729 $1,341 $1,505 $1,501 $1,027 $1,674 $1,103 $1,110 23
Slide 24: Balance Sheet 7/31/2012
Balance Sheet 7/31/2012 Assets: Cash & ST Investments $ 1,942,000 Accounts receivable, net 716,000 Tax asset 4,896,000 Goodwill 3,191,000 Notes receivable (franchisees) 1,619,000 Other assets & equip. 747,000 Total Assets $13,111,000 Liabilities & Shareholder Equity: Accounts Payable $ 85,000 Broker
Slide 25: Cash Returned To Stockholders
Fiscal Years 2003-2012 Cash Returned To Stockholders a oo S So ug bs “ereys Jed 02'S ® 3440 YSGNSL " | | 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Repivttses — $30 $25 $578 $322 $162 $30 $19 $401 $4,574 Dividends $89 $541 $604 Since fiscal 2004 ITEX has returned $7.4 million to stockholders
Slide 26: Stock Price Fiscal Years 2003-2012
Fiscal Years 2003-2012 Stock Price $5.00 $4.00 $3.00 $2.00 $1.00 $00 L 2003 2004 «= 2005» 2006 «= 2007 2008S 2009-2010 20112012 $60 $1.05 $1.90 $2.88 $4.00 $4.40 $315 $4.75 $4.05 $3.90 Dividends were initiated in 2010. ITEX has paid 33 cents in dividends per share for a total $1,234,000 since fiscal
Slide 27: Stock Price Compared to S&P 500
Stock Price Compared to S&P 500 Green line : ITEX Gray line: S&P 500 D: Dividend payments 27
Slide 28: Management Team
Management Team Years in Name Title Prior Experience Industry Steven White Chairman & CEO Ubarter.com, 29 Network Commerce John Wade CFO (as of 1/1/2013) Freeshop, Aptimus 10 Robert Benson VP Operations Ubarter.com, 22 Network Commerce Brian Argetsinger VP Marketplace ITEX Franchisee 21 Troy Hellman
Slide 29: Board of Directors
Board of Directors Name Title Prior Experience Steven White Chairman Ubarter.com, Network Commerce John Wade Secretary, Treasurer Freeshop, Aptimus, Mercent Eric Best Compensation Chair MindCorp, Mercent Nominating Chair Timothy Morones Audit Chair DataSphere, Getty Images, InfoSpace Outside Counsel
Slide 30: Reasons to Invest
Reasons to Invest • Industry leader with attractive growth potential • Strong cash flow • Scalable business model • Proprietary technology • Unique distribution channel and community • Intrinsic value of membership network 30
Slide 31: ITEX
ITEX) 775.829.2990 John Smith Sample Company