Zst Digital Networks Inc · OTC:ZSTN
Zst Digital Networks — Investor Presentation (December 2009)
21 slides from Zst Digital Networks's investor presentation, Dec 8, 2009
Slide 1: ZST Digital Networks, Inc. Investor Presentation
J ZST ZST Digital Networks, Inc. NASDAQ: ZSTN Investor Presentation December 2009
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains certain “forward-looking statements" relating to the business of the Company and its subsidiary companies. These forward-looking statements are often identified by the use of forward-looking terminology such as "believes, expects" or similar expressio
Slide 3: Company Snapshot
Company Snapshot Company Name + ZST Digital Networks Inc. (Delaware) Listing/Trading - NASDAQ/ZSTN Public Offering + October 20, 2009 Outstanding Shares _—+ 8,525,455 as of September 30, 2009 Market Capitalization - US$74.3 million as of December 4, 2009 © + Headquarter: ‘Zhengzhou, China About ZSTN
Slide 4: Attractive Valuation
Attractive Valuation Market Cap P/E Ratio NetMargin Revenue Company Name Ticker (Ysg millions) (LTM) %(LTM) Growth** BigBand Networks, Inc. Daree $227.8 125.1x 11% 19.9% EMS Technologies, Inc. ae $194.1 3.4% 12.4% See eae Ne esto 16.3x 5.5% 11.5% “ZST LTM net income calculations include the one-time
Slide 5: Leading Provider of Digital and Optical Network Equipment in Henan Province, China
Leading Provider of Digital and Optical Netw Equipment in Henan Province, China ¢ Leader in the Internet Protocol Television (IPTV) set-top box market within Henan Province, the largest province by population (130 million people) in China * Primary clients include broadcast TV bureaus and cable netw
Slide 6: Product and revenue breakdown
+ 13% of revenue + Transmitters, + 65% of revenue + Bundled cable TV, receivers, Internet and amplifiers telephone + Workstations services Power meters Ete. a a 2006 2007. wr Others + 22% of revenue Security monitoring devices + Codingidecoding devices + Ete. Revenue figures for six months to June 3
Slide 7: Investment Highlights
Investment Highlights Competitively Positioned in the Rapidly Growing TV Market in China Emerging Opportunities in GPS Tracking Systems and Services Market Flexible and “Asset-Lite” Business Model, with a Focus on Operational Efficiency Proven Product Design and Development Capabilities Established
Slide 8: Competitively Positioned in the Rapidly Growing TV Market in China
Competitively Positioned in the Rapidly Growing TV Market in China Growing Opportunities in China’s IPTV Market Robust Growth of China’s Cable TV Market # of Household Users in millions Subscribers in millions 180 20% 170 40% 160 Ss 20% 140 aise: 130 10% 120 110 0% 2004 2005 2008 2007 2008 a# of Hou
Slide 9: Competitive Position in a Rapidly Growing TV Market in China
Competitive Positi TV Market in China (c: g in a Rapidly Grow IPTV Set-top Box Market Share as of September 30, 2009 PRC Cable TV Subscribers: 160 million households “a 480 million viewers or - \A oé est Henan Province Cable TV --~~ 62.5% Subscribers: Lo a 6.7 million houséholds Other ‘Source: Compa
Slide 10: Emerging Opportunities in GPS Tracking Systems and Services Market
2 Emerging Opportu ities in GPS Tracking Systems and Services Market Large and Untapped China GPS Market Gaining Momentum + 2008 motor vehicle GPS * Signed first contract in Nov 10, market size in China: RMB8 2009 for vehicle GPS billion (168 million vehicles) — One-time supply and installation — GP
Slide 11: Flexible and "Asset-Lite" Business Model, with a Focus on Operational Efficiency
Flexible and “Asset-Lite” Business Model, with a Focus on Operational Efficiency Minimum capital requirement Efficient operational infrastructure sini ci aac Sales & Marketing Development / + Determine customer + Sourcing and inspection of raw materials and components + Final system quality control
Slide 12: Barriers to Entry and Competitive Position
International Competitors Domestic Competitors pd ‘Adaptable Technology Solutions le E Barriers to Entry Solid Branding Competitive Market Position Proven Installed Base In-Depth Market Knowledge 12)
Slide 13: Established Sales Network
5 Established Sales Network * Extensive ZST product coverage * Sales network covers all major Henan counties ZST Product Coverage 13
Slide 14: Experienced Management Team
Experienced Managem * Mr. Zhong Bo, Chairman and Chief Executive Officer — Renowned industry veteran — Extensive electronic design and product development experience * Mr. John Chen, Chief Financial Officer — In depth finance and global capital markets experience * Mr. Zhong Lin, Chief Operating Off
Slide 15: Strong Financial Performance: A Track Record of Growth and Profitability
Strong Financial Performance: A Track Rec of Growth and Profitability (USD millions) | E1Revenue LINet Income 60 55.4 | enue 50 i oO : - c : Gro 40 verincor® | aoe a 28.7 i crouitt 28.6 20 | : 152 10 56 64 il lL 29 33 06 17 ob a”. -_.. i mis — FY2006 FY2007 FY2008 Q3, 2008 Q3, 2009 ver 11.3% 10.0% 1
Slide 16: Strong Financial Performance: Balance Sheet
Strong Financial Pe Sheet (continued) 7 As of September 30, 2009 US$ Million ‘Cash Total A/R- tr W Total Assets Tar Short-term Loans BS Tot ilities: Shareholders’ Equity
Slide 17: Business Outlook
ZST Business Outlook
Slide 18: Growth Strategy
Growth Strategy -Strengt! ing
Slide 19: Guidance for Fourth Quarter 2009
Guidance for Fourth Quarter 2009 -ZSTN currently estimates that fourth quarter 2009 revenue will range between US$26 million and US$29 million ZSTN currently estimates that fourth quarter 2009 net income | will range between uss3. 0 million and US$3.5 million
Slide 20: Investment Highlights
Investment Highlights EVE UUY Competitively Positioned in the Rapidly Growing TV Market in China Emerging Opportunities in GPS Tracking Systems and Services Market Flexible and “Asset-Lite” Business Model, with a Focus on Operational Efficiency Proven Product Design and Development Capabilities Esta
Slide 21: Thank you
NASDAQ: ZSTN Thank you www.shenyangkeji.com
ZST Digital Networks — Investor Presentation (December 2009) on 6ix