Solution Dynamics Limited · NZX:SDL

Solution Dynamics — Shareholder Meeting (November 2008)

30 slides from Solution Dynamics's shareholder meeting presentation, Nov 11, 2008

1. Slide 1: Annual Shareholders Meeting 11 November 2008

   Annual Shareholders Meeting 11 November 2008

2. Slide 2: Annual Shareholders Meeting: Maurice Kidd, Chairman

   Annual Shareholders Meeting Maurice Kidd Chairman

3. Slide 3: Agenda

   Agenda ƒ Chairman’s Report ƒ CEO’s Report ƒ Business – Resolutions ƒ General Business

4. Slide 4: Performance Highlights

   Performance Highlights ƒ Strong revenue growth achieved ƒ Image & Mail showing excellent growth ƒ Colour ƒ Dejar license sales thru PrintSoft ƒ Migration to higher margin products and services completed ƒ Neither EBITDA nor NPAT meet our expectations

5. Slide 5: Operating Revenue

   Operating Revenue ($000’s) Operating Revenue 11500 11000 10500 NZ$(000)'s 10000 9500 9000 8500 2005 2006 2007 2008 • Dejar sales increased by 154% to $1.2 mill. On the ’07 year. • Image & Mail sales increased by 5%. • Mix focused on higher margin products.

6. Slide 6: EBITDA

   EBITDA ($000’s) EBITDA 800 700 600 NZ$(000)'s 500 400 300 200 100 0 2005 2006 2007 2008 • Up 94% to $722k.

7. Slide 7: Net Deficit

   Net Deficit ($000’s) Net (deficit) 0 2005 2006 2007 2008 -100 -200 -300 NZ$(000)'s -400 -500 -600 -700 -800 • Deficit reduced by 53% to $253,000 • Target of breakeven – Has taken longer to turn Image & Mail business around – Increases in payroll, property & other costs

8. Slide 8: Operating Cash

   Operating Cash ($000’s) Operating cash 1000 800 600 400 ($000's) 200 0 -200 2005 2006 2007 2008 -400 -600 -800 • Up 170% to $806k. • Improving earnings. • Good management of balance sheet.

9. Slide 9: Capital Raising Jul – Sept '08

   Capital Raising Jul – Sept ‘08 • Share placement July ’08 – Issue 1.5 million shares – Issue price of $0.40 per share – Value of $600k • Share purchase plan – Issue 420,325 shares – Issue price of $0.375 per share – Value $157,622 – One in six shareholders participate • Debt to equity ratio improves

10. Slide 10: Strategy Update

    Strategy Update Phase1 BUILD & DEFEND Phase 2 BUILD EMERGING BUSINESS Phase 3 EXPAND THE OFFER

11. Slide 11: Focus - Growth Strategies

    Focus -Growth Strategies Issue with scale – to be profitable need to grow ƒ Organic growth- ƒ New customers image & mail ƒ New technologies – Dejar & Colour ƒ Extend reach – Australia / new channels ƒ Partnerships ƒ Printsoft ƒ Acquisitions ƒ Must meet criteria ƒ Difficult environment

12. Slide 12: 2009 Outlook

    2009 Outlook Actual Actual Outlook Change 2007 2008 2009 Trading results Operating Revenue 9,385 10,653 11,100 4.2% EBITDA 373 722 1,100 52.4% Net profit (deficit) after tax (536) (253) 400 258.1% Aim: ƒ Continue focus on lifting revenues and earnings ƒ Continued focus on higher margin services ƒ Co

13. Slide 13: Annual Shareholders Meeting: Nelson Siva, CEO

    Annual Shareholders Meeting Nelson Siva CEO

14. Slide 14: What We Achieved

    What We Achieved ƒ Grow top line - YES ƒ Complete consolidation process - YES ƒ Niche products and services - YES ƒ Quality and cost leadership - Partly ƒ Grow market share - YES

15. Slide 15: Statements are Evolving

    Statements are Evolving Pre-printed forms 1:1 Personalised SYSOUT overprinted with B&W Dynamic Colour output data – Documents & Internet little or no personalisation Presentment Increasing Value to Customers

16. Slide 16: Variable Data Market Convergence

    Variable Data Market Convergence Promotional Applications Restricted Personalised and Customised Financial Printing (Personalised Content with Marketing Collaterals) Hybrid Applications Customised Transactional Printing Transactional Documents (Bills, Statements, etc.) Transactional Phase 2 Applicat

17. Slide 17: What we do

    What we do BUSINESS COMMUNICATIONS - SIMPLIFIED Client Create Data Entry Digital Print Web Digitise Portal Process Response Multi channel Processing distribution Client’s Customers

18. Slide 18: Operational Highlights

    Operational Highlights ƒ Revenue growth 13.6% ƒ Laser volume up 18% ƒ Image & Mail volume up 5% ƒ Colour volume 13% of total ƒ Dejar – Licence sales up 240%

19. Slide 19: New Business

    New Business ƒ Major Utility - Billing & Colour ƒ Major Publisher – Fulfilment, Marketing & Colour ƒ International Credit Card – Billing, Marketing & Colour ƒ Distribution Services – Billing, Marketing ƒ Financial Services Institution - Marketing ƒ Local Body – Billing & Colour ƒ Major Retailer - Ma

20. Slide 20: Image & Mail Performance

    Image & Mail Performance Sales Growth & Mix 120% 100% 80% 60% 40% 20% 0% 2006 2007 2008 Mail house Print, post & other Gross Margin Growth & Mix 140% ƒ Revenue 120% 100% ƒ Higher margin product 80% 60% 40% ƒ Overall margin 20% 0% 2006 2007 2008 Mail house Print, post & other

21. Slide 21: Dejar Performance

    Dejar Performance Dejar Income Statement 1,000 500 900 400 800 Earnings $(000)'s 700 300 Sales $(000)'s 600 200 500 400 100 300 0 200 (100) 100 0 (200) Jul-Dec'06 Jan-Jun'07 Jul-Dec'07 Jan-Jun'08 Sales Earnings ƒ License Sales ƒ Maintenance Revenue ƒ Recurring Charges

22. Slide 22: Dejar

    Dejar ƒ Archival for global mail processing system ƒ Hosted SaaS (1) in four countries ƒ New customers in UK, Germany & Greece ƒ New prospects – UK, Germany, Greece, Slovakia, Czech Republic, Russia, Saudi, USA, Philippines & Australia (1) SaaS = Software as a Service (Bureau business)

23. Slide 23: Laser Market - Page Volume Growth

    Laser Market - Page Volume Growth Monochrome Digital Pages Colour Digital Pages Total Pages Total Pages 200 -1.6% CAGR 40 42 186 180 171 30 35%CAGR 150 Billion Pages 100 20 16 50 10 9 0 0% 2004 2006 2009 2004 2006 2009 Source: CSI&SI Corporate Market Europe Forecast 04-09

24. Slide 24: Overhead Costs

    Overhead Costs Operating Revenue & Expenses 12000 11000 10000 9000 NZ(000)'s 8000 7000 6000 5000 4000 3000 2000 2005 2006 2007 2008 Operating revenue Payroll Other expenses • Shift to services – people costs increase • Dejar – development investment • Inflation

25. Slide 25: Growth Strategies

    Growth Strategies ƒ Organic growth- ƒ Market share ƒ New technologies – Dejar & Colour ƒ Extend reach – Global / new channels ƒ Partnerships ƒ PrintSoft ƒ Acquisitions ƒ Must meet criteria ƒ Difficult environment

26. Slide 26: Outlook

    Outlook ƒ Increase market share ƒ Colour expansion ƒ e- business growth ƒ Dejar development ƒ Return to profit

27. Slide 27: Annual Report

    Annual Report ƒ That the Annual Report of SOLUTION DYNAMICS LIMITED for the financial year ended 3O June 2008 be received.

28. Slide 28: Election of Directors

    Election of Directors ƒ To re-elect COLIN GIFFNEY as a Director of Solution Dynamics Limited.

29. Slide 29: Appointment of Auditors

    Appointment of Auditors ƒ That Grant Thornton be appointed auditor of the Company for the ensuing year and that the Board of the Company be authorised to fix the auditor’s remuneration for the ensuing year.

30. Slide 30: General Business

    General Business ƒ General Business

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