Slide 1: Second Quarter Fiscal 2023
SECOND QUARTER FISCAL 2023 NASDAQ: DAKT
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. All forward-looking statements involve risks and u
Slide 3: Daktronics Vision
DAKTRONICS VISION To be the world leader at informing and entertaining audiences through dynamic audio-visual communication systems.
Slide 4: Daktronics Mission
DAKTRONICS MISSION Our Values Reflect our Mission Every day, our values are reflected in the way we build our products and our relationships. We deliver industry-leading value to our customers by: ooo @o 6 Engaging our Developing Leveraging our Contributing to Generating an employees strategic stren
Slide 5: Industry Leader
» |e 7 BUCKSKINS ¥-* TOGO BALLON QTR Digit & Price Displays Indoor LCD Signs Digital Street Furniture Elements JEL, TIME) TO: bs) ITS Dynamic Message Signs Sound Systems 20 vIn @ io Digital Billboards LED Signs
Slide 6: Around the Globe
: Sales Office : Manufacturing Facility Products in 120+ Countries OFFICES throughout the world AROUND THE GLOBE
Slide 7: 10 Year History Sales & Operating Income %
10 YEAR HISTORY SALES & OPERATING INCOME % Daktronics History (in Millions) 700 10.0% Operating Income(Loss) as % of Sales 600 8.0% 500 6.0% 400 4.0% SALES 300 2.0% 200 0.0% 100 -2.0% - -4.0% FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 Sales Operating Income(Loss) as % of Sales
Slide 8: 10 Year History Free Cash Flow
10 Year History Free-Cash Flow* FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 Net cash from operations $ 50,749 $ 36,199 $ 54,702 $ 13,354 $ 39,407 $ 30,361 $ 29,546 $ 10,808 $ 66,212 $ (26,830) Net capital expenditures (9,476) (13,281) (24,830) (23,963) (8,304) (15,948) (16,
Slide 9: More about Daktronics
More about Daktronics 10 YEAR HISTORY ✓ 52/53 Week Fiscal Years ending in April DILUTED EARNINGS PER SHARE (after adjustment for splits) ✓ Seasonality to results (Sports/Construction Fiscal Year Q1 Q2 Q3 Q4 season) 2013 + 0.16 + 0.27 + 0.06 + 0.04 2014 + 0.13 + 0.27 + 0.07 + 0.04 ✓ Video systems com
Slide 10: Current Conditions
CURRENT CONDITIONS ➢ Record backlog of $463.1 million, exciting order pipeline ➢ While market demand remains strong, macroeconomic events increase likelihood of deteriorating global economic conditions ▪ Strong second quarter orders, some International demand softening ➢ Extraordinary supply chain d
Slide 11: Cash Management & Liquidity Program
CASH MANAGEMENT & LIQUIDITY PROGRAM 1. Cash generation focus through proactively completing and fulfilling orders in our $463.1 million backlog, through: a. Productivity improvements from previous investments in factory capacity expansion and capital equipment and hiring only critical production and
Slide 12: FY2022 Annual Results
FY2022 ANNUAL RESULTS ($ in thousands, except per share data) Twelve Months Ended 30-Apr 1-May Percent 2022 2021 Change Orders $ 846,071 $ 515,884 64.0% Net sales $ 610,970 $ 482,033 26.7% Gross profit 116,697 120,583 -3.2% Gross margin 19.1% 25.0% Operating income 4,046 17,108 -76.4% Operating marg
Slide 13: FY2023 Second Quarter Results
FY2023 SECOND QUARTER RESULTS ($ in thousands, except per share data) Three Months Ended 29-Oct 30-Oct Percent 2022 2021 Change Orders $ 182,807 $ 163,707 11.7% Net sales $ 187,439 $ 164,477 14.0% Gross profit 31,704 32,264 -1.7% Gross margin 16.9% 19.6% Operating income 1,526 4,385 -65.2% Operating
Slide 14: FY2023 YTD Results to Q2
FY2023 YTD RESULTS-TO Q2 ($ in thousands, except per share data) Six Months Ended 29-Oct October 30, Percent 2022 2021 Change Orders $ 353,030 $ 345,453 2.2% Net sales $ 359,359 $ 309,209 16.2% Gross profit 57,498 64,452 -10.8% Gross margin 16.0% 20.8% Operating income (3,993) 10,045 -139.8% Operati
Slide 15: Business Unit Recap
Business Unit Recap ✓ Live Events, Commercial, Transportation, and High School Park and Recreation, include net sales in the United States and Canada ✓ International net sales include rest of world and are primarily for solutions for large sports venues, spectaculars, third-party advertising, and tr
Slide 16: Live Events Business Unit
LIVE EVENTS BUSINESS UNIT New England Patriots
Slide 17: Live Events
LIVE EVENTS » Video display solutions for large sports venues and live entertainment facilities • Professional sports • College and university • Arenas » Competition FC Cincinnati • Prismview (Division of Samsung), Leyard, ANC, Yaham, Mitsubishi, Panasonic, and others • Asian competition through U.S
Slide 18: Live Events Demand Drivers
LIVE EVENTS Demand Drivers » Facility increased spend to: • Enhance attendee event experience • Revenue source from advertising • Competitive nature to outperform other facilities » Lower product costs, driving expansion of marketplace » High definition product offering (HD) » Replacement cycle (sys
Slide 19: High School Park and Recreation (HSPR) Business Unit
HIGH SCHOOL PARK AND RECREATION (HSPR) BUSINESS UNIT River Falls High School, Wisconsin
Slide 20: HSPR
HSPR » Video and scoring systems and message centers to • Elementary and high schools, junior colleges • Park and recreation departments » Primary funding is through local sponsors and advertisers West Branch High School, Ohio Aberdeen Central High School, SD
Slide 21: HSPR Growth Drivers and Competitors
HSPR »Growth Drivers • Larger more sophisticated displays in sports venues • Revenue generation • Communication medium • New construction/replacement cycles • Curriculum usage »Competitors • Fair-Play by Translux, Scorevision, Translux, Nevco, Spectrum, Electro-Mech Scoreboards • Other smaller compa
Slide 22: Commercial Business Unit
COMMERCIAL BUSINESS UNIT Wilderness Resort Book Your Billboard Pendry West Hollywood Hotel Baraboo, WI Sioux Falls, SD West Hollywood, CA
Slide 23: Commercial
COMMERCIAL » Sales channel focus • Third party advertising/Out of Home Advertising (OOH) • On-premise advertising (retail) • Spectacular (custom video) Marquee Media, Sacramento, CA » Primary offerings • Digital billboards • Message centers • Video display systems/display walls • Petroleum displays
Slide 24: Commercial Growth Drivers and Competitors
COMMERCIAL » Long-term growth drivers • Market adoption, including National Accounts • Spectacular use to entertain/advertise in unique locations • Effective advertising medium (outdoor and indoor networks) George Chevrolet Bellflower, CA • Replacement cycle (7-10 years) • Architectural lighting » C
Slide 25: Transportation Business Unit
TRANSPORTATION BUSINESS UNIT Project NEON, Nevada DOT Ft. Lauderdale-Hollywood International Airport
Slide 26: Transportation
TRANSPORTATION » Three niches • Intelligent transportation systems (ITS) • Airports • Mass Transit » Competitors • Skyline • Ledstar • Telegra • Sunrise SESA Technologies, Inc. • LG-MRI • Adaptive Micro Systems Intelligent Transit Systems (ITS) • Solari USA Penn Turnpike, Norristown Interchange, PA
Slide 27: Transportation Long-term Growth Drivers
TRANSPORTATION » Long-term growth drivers • Transportation management - increasing traffic demands on constrained infrastructure • Governmental funding and investment in infrastructure projects • Infographic communication • Advertising needs Minneapolis-St. Paul International Airport Roadway and Par
Slide 28: International Business Unit
INTERNATIONAL BUSINESS UNIT National Museum of Qatar Doha, Qatar
Slide 29: International Main Products
INTERNATIONAL Main products » Commercial video systems » Sports video systems » Digital billboard (OOH) » Architectural lighting Marina Mall - Dubai » Transportation systems Infrastructure » World-wide sales & service offices » International Manufacturing: • China- architectural lighting and video d
Slide 30: International Growth Opportunities
INTERNATIONAL » Growth opportunities • 3rd party advertising/Out of Home Advertising • Live Events facilities/sports • European/Middle East Tochigi City Football Club - Japan transportation systems • Increased geographical coverage » Competitors: Absen, Samsung, Aoto, Leyard, Unilumen, Mitsubishi, L
Slide 31: Looking Ahead
LOOKING AHEAD Westfield Manukau City – Circa Resort and Casino – Krispy Kreme – Auckland, New Zealand Las Vegas, Nevada, USA New York, New York, USA
Slide 32: Near-Term Expectations
NEAR-TERM EXPECTATIONS FY2023 focus - ✓ Maximizing productivity, balancing constraints expected (supply chain) ✓ Strategic investments in our capacity additions for elevated demand and future demand expectations ✓ Managing headwinds in material, labor, freight availability, and inflation ✓ Offering
Slide 33: Achieving Long-Term Profitable Growth & Shareholder Value Creation
ACHIEVING LONG-TERM PROFITABLE GROWTH & SHAREHOLDER VALUE CREATION - Growth ✓Continued global market adoption and expansion ✓Providing industry leading solutions and services ✓Natural Replacement cycle ✓Brand of choice and value to customers ✓Continued investment in new and advancement in technologi
Slide 34: Solution Examples
Content Compositing Live Data Integration Media Players & P DAKTRONICS
Slide 35: Technology
DYNAMIC MESSAGE SIGNS TECHNOLOGY CONTROL SYSTEMS
Slide 36: Questions
Slide 37: 10 Year History Supplemental Information
10 YEAR HISTORY SUPPLEMENTAL INFORMATION