Vuzix Corporation · NASDAQ:VUZI
Vuzix — IPO Roadshow (July 2013)
44 slides from Vuzix's IPO roadshow presentation, Jul 30, 2013
Slide 1: Investor Presentation July 2013
Investor Presentation July 2013
Slide 2: Free Writing Prospectus Statement
2 Free Writing Prospectus Statement Vuzix Corporation (“ Vuzix ”, “we”, “our” or the “Company”) has filed a registration statement (including a preliminary prospectus) with the SEC for the offering to which this communication relates. The registrations statement is not yet effective. Before you inve
Slide 3: Cautionary Note Regarding Forward Looking Statements
3 Certain statements included in this presentation may be considered forward - looking . All statements in this presentation that are not historical facts are forward - looking statements . Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results
Slide 4: Offering Details
4 Offering Details Issuer Vuzix Corporation Proposed Listing/Ticker TSX - V: VZX, OTCQB: VUZI, FMB: V7X Offering Size Approximately $6 million (15% over - allotment) Securities Offered Common Stock & Warrants Use of Proceeds We expect to use the net proceeds received from this offering to complete c
Slide 5: Vuzix Background
5 Vuzix Background • Founded 1997 - World Wide Operations • One of the World’s Leading supplier of - Wearable display technology • Cornerstone IP and Patent Portfolio - 33 patents and 15 patents pending • Employees - 25 total with 8 engineering staff • Award Winning Technology and Design - Immersive
Slide 6: Executive Management
6 Executive Management • Paul J. Travers – Founder and President and Chief Executive Officer; has more than 25 years experience in the consumer electronics field, and 20 years experience in the virtual reality and virtual display fields • Grant Russell – Chief Financial Officer; has over 30 years ex
Slide 7: Mobility is Creating Billion Dollar Markets
7 Mobility is c reating B illion D ollar M arkets • Gartner Research estimates 714 million smart phones sold in 2014 • ABI Research forecasts the wearable computing device market will grow to 485 million annual device shipments by 2018 - More than 75 million of these will be Smart G lasses • “Smart
Slide 8: Smart Phones are Growing Beyond Text - Voice - Internet
8 Smart Phones are Growing B eyond Text - Voice - Internet
Slide 9: Augmented Reality applications are expanding across many verticals
9 Augmented Reality applications are expanding across many verticals Retail/Commerce E - learning Location Based Services Gaming Travel Social And delivering amazing experiences Understand what you are looking at… Make smarter choices…. Share your experiences….. Find your way there….. * Apps display
Slide 10: For Mobility, Gaming and AR – Need a New Device
10 1983 1980s Email – 1972 Text msg – 1992 Internet www – 1995 Cloud connected apps from AR to gaming 1994 to now For Mobility, Gaming and AR – Need a New Device 1990 2000 2012 Smart Glasses
Slide 11: A Day in the Life of Cloud Connected You
11 A Day in the Life of Cloud Connected You… http:// sidv.co /author/ sid / Images: Siddharth Vanchinathan
Slide 12: Smart Glasses
12 Smart Glasses • The Solution - Video glasses afford big screens in a compact, wearable package - Wearable interactive displays with private viewing anytime, anywhere - The perfect hands free mobile phone display screen • The Challenges - Make them like regular eyeglasses - Make them HD, smart and
Slide 13: Vuzix Technology – IP for Smart Glasses
13 Vuzix Technology – IP for Smart Glasses GOVERNMENT Advanced Display and Optics Development Contracts. Supports Vuzix Business Strategy and Technology Paths • O ver $35 million invested – Vuzix IR&D and US Government • A strong IP portfolio consisting of more than 33 patents and 15 patents pending
Slide 14: Patents and patents pending for Smart Glasses
14 Patents and patents pending for Smart Glasses This is in addition to trade secrets, copyright, other licenses and proprietary technologies at Vuzix Count Thin optics for smart glasses Dynamic and passive waveguides 5 Display engine with optics Dynamic and scanning display engine 8 Smart Glasses a
Slide 15: Vuzix Proprietary Waveguide Optics
15 Vuzix Proprietary Waveguide Optics • Waveguides are a revolutionary way of moving light - Image is injected into a 1.4mm thin waveguide like a fiber optic - Not bent through bulk material like conventional optics • Provides a significant improvement in - Mass, cost, volume, simplicity and optical
Slide 16: Vuzix Proprietary Scanning Engine Display
16 Vuzix Proprietary Scanning Engine Display • Scanning display is a revolutionary way to create virtual displays - 1 thin line of LEDS and a MEMs scanner into a waveguide - Instead of three power hungry LEDs that are 100% on, with expensive large area megapixel microdisplays that then need to be ma
Slide 17: Competition – Industrial and Early Adopters Only
17 Competition – Industrial and Early Adopters Only • Market has been constrained by bulky appearance, poor ergonomics and technical limitations of optics • No company dominates, but Vuzix has always led the field in optics, styling and wearability… Conventional Optics for Video Viewers & Gaming Vuz
Slide 18: Smart Glasses – M Series for Enterprise/Prosumer
18 Smart Glasses – M Series for Enterprise/ Prosumer • M100 – first of smart glasses line • Winner of CES 2013 Innovations Award • Shipping to developers with commercial production late summer • Smart & powerful computing device • Native Android OS – runs thousands of existing apps • WQVGA display &
Slide 19: Competition – Google Glass vs M100 Smart Glasses
19 Competition – Google Glass M100 Smart Glasses 1) Shipping Fall 2013 2) Enterprise and prosumer centric 3) Runs standard Android OS 4) Standalone usage models are supported – no internet needed 5) Run apps onboard and real - time 6) Optics work in bright daylight 7) Built in GPS 8) Expandable to 6
Slide 20: SAP / Vuzix Augmented Reality Solutions
20 SAP / Vuzix Augmented Reality Solutions http://www.youtube.com/watch?v=9Wv9k_ssLcI
Slide 21: Vuzix smart glasses run native Android OS
21 Vuzix smart glasses run native Android OS • Most Enterprise users NEED Open O/S • Works with thousands of existing and unmodified Android apps • Existing Android apps are easily modified for improved performance and functionality
Slide 22: Smart glasses designed to connect with Bluetooth devices/sensors
22 Vuzix smart glasses are d esigned to connect with Bluetooth devices/sensors – Enterprise market centric
Slide 23: Vuzix Smart Glasses Standalone or Cloud Connected
23 Vuzix Smart Glasses Standalone or Cloud Connected Native Apps run on M100 Standalone Enterprise Apps HMD Apps run on Smartphone iOS or Android Cooperative Related Apps run on Smartphone and M100 iOS or Android Cloud Optional, all modes
Slide 24: Smart Glasses
24 Smart Glasses • First binocular fashion - wear smart glasses • Hands - free operation by voice and gesturing • Run apps onboard or on a paired Android or iOS device • qHD displays and 1080p camera • W ireless connectivity with integrated power • True eyeglass styling with electro - tint • Builds
Slide 25: Industrial See through – M2000 for enterprise
25 Industrial See through – M2000 for enterprise • First waveguide based solution • Ruggedized for industrial applications • 720p display and 1080p camera • M2000AR – currently HDMI connection • Programmable electronic shutter adjusts for indoor/outdoor use • HDMI version shipping early summer • Wil
Slide 26: Personal Viewing and Gaming Smart Glasses
26 Personal Viewing and Gaming Smart Glasses • HDMI 3D and streaming WiFi ready • Designed for PC, Console, Smartphone • 720P - highest resolution with largest FOV at 55+ degrees (Front row of theater) • AR & VR Application ready with tracking, audio, microphone, camera • Runs Android OS and apps di
Slide 27: A Step Change in Technology
27 Smart Glasses – B Series Smart Glasses – M Series HD Gaming/Viewing 2000 – 2012 Starting in 2013 it’s all going Smart Glasses Bulky Legacy Solutions 2013 Forward A Step Change in Technology Going From Bulky Football Helmets to Fashionable Glasses
Slide 28: Growing Smart Glasses Development Partners
28 Growing Smart Glasses Development Partners • Many thousands of existing developers – AR, VR and Smart Glasses • Online developer portal and support • Smart Glasses SDK – $1k with annual fees • Fully open so enterprise users can customize to their needs
Slide 29: Global Technology and Channel Partners
29 Global Technology and Channel Partners Technology Channel
Slide 30: Current Line of Video Eyewear
30 • Wide Screen Video Glasses - 52 & 75 inch v irtual screens • Virtual Reality Glasses - Includes head tracker • Limited by technology to standard definition CE Industry Award - Winning Products Last 9 Years Current Line of Video Eyewear
Slide 31: Current Line of Augmented Reality Glasses
31 Current Line of Augmented Reality Glasses • Wrap1200AR – all digital see through, stereo cameras • STAR 1200 series – optical see - through HD camera • Mainly research and commercial users Digital See Through Optical See Through AR at a Construction Site
Slide 32: Vuzix Products in Action
32 Vuzix Products in Action Industry, Education, Gaming, VR and AR, Medical and More
Slide 33: Going to Market Globally
33 Going to Market Globally • US – Direct and major national distributors • EMEA – Distributors in 30+ countries • Web store with fulfillment and warehouses in US, UK, EU, and Japan • Apple.com in over 22 countries (JP and EU) • Exploring new market sectors and geographic licensing
Slide 34: Historical Financial Data
34 (USD, 000s) Dec 31, 2012 Dec 31, 2011 Sales $3,228 $4,826 Cost of Sales 2,341 3,615 Gross Margin 887 1,211 Operating Expenses 4,560 5,579 EBITDA (3,673) (4,368) Depreciation and Amortization 534 504 (Loss) from Continuing Operations (4,206) (4,872) Taxes and Other Income (Expense) (541) (461) Net
Slide 35: Q1 2013 Financial Data
35 (USD, 000s) Mar 31, 2013 Mar 31, 2012 Sales $739 $1,110 Cost of Sales 337 751 Gross Margin 402 359 Operating Expenses 1,009 1,165 EBITDA (607) (806) Depreciation and Amortization 98 145 (Loss) from Continuing Operations (706) (951) Taxes and Other Income (Expense) (231) (117) Net (Loss) from Cont
Slide 36: Vuzix Historical Balance Sheet
36 (USD, 000s) Dec. 31, 2012 Mar. 31, 2013 Pro-Forma Assets Cash $67 $532 $3,647 Accounts Receivable 171 224 224 Inventory & Prepaids 972 957 714 Current Assets 1,210 1,713 4,585 Net Fixed Asset & Intangibles 1,216 1,371 1,145 Total Assets 2,426 3,084 5,730 Current Liabilities 5,150 6,596 4,242 Long
Slide 37: Use of Proceeds
37 Use of Proceeds • Commercialization of M100 Smart Glasses for volume production late Q3 • New waveguide optics with production of Gen 2 Version by Fall 13 • Introduction of binocular Smart Glasses for CES 2014 • Production tooling of VFX720 headphone • HD display engine proto spring 2014 • Repaym
Slide 38: Capitalization Table
38 Capitalization Table (2, 3) 1. Senior term debt, term deferred trade payables, accrued compensation and all accrued interest totaling $3,759,709 as of Mar 3 1, 2013 converting on close of offering 2. Gross offering to raise $6,000,000 at an assumed offering price of $5.26 per share/warrant 3. Off
Slide 39: Comparable Company Valuation
39 (figures in millions, except per share data) Price (1) 52 - Week Equity Firm Firm Value / Revenue Firm Value / EBITDA Company @ 07/29/13 High Low Value Value (2) LTM CY 2013E CY 2014E LTM CY 2013E CY 2014E Plantronics, Inc. $45.64 $48.39 $30.90 $1,929 $1,583 2.1 x 1.9 x 1.8 x 10.3 x 8.9 x 8.1 x S
Slide 40: Vuzix Investment Highlights
40 Vuzix Investment Highlights • A cknowledged as one the world leaders in Smart Glasses, established over the last 20 years, and at the front end of market opportunities in the billions of dollars • A clear vision of the important role that mobile displays will play in the future • Strong R&D plan
Slide 41: Thank You
<— vuzDbe Www.vuzix.com Sa VUZIX View the Future Thank You
Slide 42: Appendix of Vuzix Materials
42 Appendix of Vuzix Materials
Slide 43: Vuzix Manufacturing
43 Vuzix Manufacturing • Capable of ~30K units/quarter • Asian suppliers capable of high volume – supply to Logitech, Belkin , etc.
Slide 44: Waveguide Optics - Tools to Production
44 Waveguide Optics - Tools to Production Laser Lithography Reactive Ion Beam Etch UV Replication