Lgl Group, Inc. (the) · AMEX:LGL
Lgl Group, Inc. (the) — Investor Presentation (February 2008)
26 slides from Lgl Group, Inc. (the)'s investor presentation, Feb 29, 2008
Slide 1: LGL Group: Engineering, Service, OEM Focused
@ TWF pas. Bee | LGL Group (AMEX: LGL) Engineering Service OEM Focused
Slide 2: Safe Harbor Statement
rom Safe Harbor Statement GROUP) This document includes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual
Slide 3: LGL Group Changes in 2007
ofa > ¥ LGL Group Changes in 2007 IsRour) — Executed a plan to improve company’s value creation — Divested Lynch Systems + Lynch Systems generated operating income losses of almost $3 million for the total of 2006 and 2007 + Lynch Systems was an unrelated business to MtronPT1 — Corporate offices in
Slide 4: Impact of LGL Group Changes
wea) Impact of LGL Group Changes ‘endun) — LGL Group is now a single line of business with a single, integrated management team doing business as MtronPT1 — Improved operating income and cash flow from the divestiture of Lynch Systems — Reduced administrative and corporate spending with the consolid
Slide 5: What We Do As MtronPTI
vara) What We Do As MtronPTI ca | * Develop and manufacture custom, highly- ene ‘ engineered electronic components wa ws + Provide engineering services to customize or these electronic components for specific t+ customer applications + Precision, quartz-based frequency/timing =s management devices ”
Slide 6: Our Primary Markets
nian) Our Primary Markets en dur} + Telecommunications & Networking Infrastructure — Cell phone base stations — Microwave radios for point-to- point and point-to-multipoint applications — Switches and routers + Military, Avionics and Space — Radar — Communications systems — Electronic warfare — Weap
Slide 7: Our Global Footprint
Our Global Footprint CS R a u P) Manufacturing/R&D Locations Yankton, SD, USA Orlando, FL, USA Monroe, CT, USA New Dethi, India Orlando, FL, USA Yankton, SD, USA San Jose,CA,USA Monroe, CT, USA Eindhoven, Netherlands Beijing, China Shanghai, China Hong Kong Beijing, China
Slide 8: Major Customers
ras) Major Customers a “£2. Agilent Technologies Ainritsu o Opeetye mieten ERICSSON Z
Slide 9: Core Competencies
) . oa x Core Competencies aintiute) + Breadth of Technology Offerings — Custom, highly-engineered product capabilities — Internally and externally (US Government) funded — Acquired fecnnoiogy with roots from Motorola and Hewlett Packard + Supply Chain Innovations — Multiple US-based, Vertically Int
Slide 10: Custom or Highly Engineered devices
* Custom or “Highly Engineered” devices — Our focus — Unusual frequencies — Specialized signal characteristics — Extreme environment — Results in higher revenue per unit and margins + Subsystems — Our emerging focus — Timing with added functions — Signal management with added functions — Results in
Slide 11: Standard devices — Not our focus
+ Standard devices — Not our focus — High volume, low selling prices — 3° World production — Automated factories — Avoids business driven by “cost only” customers + Engineers are 20% of our people (60+ engineers /scientists) — Product development — Sales — Manufacturing — Management 1
Slide 12: Where We Play (and where we don't)
Where We Play (and where we don’t) ‘Annual Production Quantities 100s - 10,0005 Unit Price ‘$1,000 - $100,000 10,000s - 1,000,000
Slide 13: Driving Trends in Our Markets
y Driving Trends in Our Markets GS latte P) * Telecommunications and Networking — Network centric communications — Mobile system access — Exponential growth of content continues * Military/Avionics — Network enabled troops — GPS tracking/control of assets — Electronic warfare — Unmanned mobile syste
Slide 14: MtronPTI's Market Segments
pias) MtronPTI’s Market ‘er oury Segments Distribution & Other 10% Military & et Aerospace . 31% Test & Medical & Measurement Industrial 7% 5%
Slide 15: OEM Focused
as OEM Focused ‘en dun) + MtronPTI is focused on business growth at the leading OEMs in its primary markets + These leading companies control most aspects of the buying cycle for MtronPTI products, although they often do not place the purchase orders directly + Many of these companies have preferred
Slide 16: Our Value Proposition
yl Our Value Proposition GROU P) + Preferred design partner for customized electronic components and signal management subsystems + Broad offering of timing and signal management products + Rapid prototype delivery to support engineering design groups + Supply chain for flexible, responsive service
Slide 17: Applications Where We Play
vias > x Applications Where We Play ‘\erour) * Telcom Infrastructure — GPON — WiMax — Wireless and wireline systems * Networking — Wireless area networks — LAN switches — IP phone systems — Enterprise storage systems * Military — JTRS/Manpack/Falcon military radios — Anti-IED jammers — Classified su
Slide 18: Applications Where We Play (cont.)
war) Applications Where We Play GROUP) + Military (cont.) — Military web-enabled communications — Unmanned and long distance surveillance systems + Space — AEHF — MUOS + Avionics — Boeing Dreamliner and Airbus A380 — Regional & Private Jets 418.
Slide 19: Manufacturing
Manufacturing A Custom products development — Technology development — New Process development and refinement — “Fast Response” service capability — Location for “secret classified projects + US, + Asia/Pacific Rim + New Delhi —Mature designs —Investing in capacity —Cost sensitive designs —Building
Slide 20: A Tradition of Growth
ras) A Tradition of Growth MtronPTI (frequency control devices) Revenue - pro forma ($ millions) $30.0 $25.0 4 $20.0 $15.0 $10.0 $5.0 $0.0 2005 = 2006-2007 (Om)
Slide 21: Profitability
man Profitability MtronPTI (frequency control devices) Operating Income - pro forma ($ millions) $3.5 $3.0 $2.5 $2.0 $1.5 $1.0 $0.5 [| $0.0 = = 60.5 |--2003____2004 2005-2006 _ 2007 (9m)
Slide 22: Our Balance Sheet
was) Our Balance Sheet GROUP) LGL GROUP BALANCE SHEET (In thousands) Adj. for Disc. Ops 09/30/07 12/31/06 ASSETS: CASH & INVESTMENTS $ 5,462 $ 7,135 ACCOUNTS RECEIVABLE 5,793 6,472 INVENTORIES 5,057 6,105 OTHER CURRENT ASSETS 2,046 5,652 TOTAL CURRENT ASSETS $ 18,358 $ 25,364 PP&€E and Other 5,072 5
Slide 23: Liabilities and Equity
wea) Liabilities and Equity ale LGL GROUP BALANCE SHEET (In thousands) Adj. for Disc. Ops 09/30/07 12/31/06 LIABILITIES & EQUITY: PAYABLES & ACCRUED EXPENSES $ 4,591 $ 5,625 CURRENT MATURITIES OF DEBT 1,670 3,383 OTHER LIABILITIES 127 2,142 TOTAL CURRENT LIABILITIES $ 6,388 $ 11,150 LONG TERM DEBT 4
Slide 24: Our Growth Strategy
vias ) Our Growth Strategy ‘GROouP) + Grow with leading OEMs — Broad product portfolio — Synergy of filters/oscillators in wireless — Leverage OEM position to bring a complementa rtfolio of products from 3° party suppliers — Life-cycle strategy — Special value with supply chain + RF & Microwave * Ti
Slide 25: Our Management Focus
peas aa » Our Management Focus \endur) + Complete corporate and Orlando restructuring + Grow into expanded India facilities + Improve margins — Focused engineering work for higher revenue products — Expanded use of India — Growth in the use of outside Asian facilities for semi-finished crystals — Op
Slide 26: Compelling Investment Considerations
ota Compelling Investment crour Considerations Streamlined Company Improved Focus Structure Markets where posed Dusen L G L Engineered Products bring Value & array. ot ous to Growth Potential Impressive History of Customer Base of Growth Industry Leaders