INVESTORS PRESENTATION

Transcription

1 INVESTORS PRESENTATION Presented by : Gilles Gaudreault CEO Field & Supply Chain Mobility Consult Design Deploy Manage

2 Safe Harbor This presentation is neither an offer to sell nor a solicitation of offers to purchase securities. This presentation is the confidential intellectual property of Quest Solution, Inc. ( Quest ). Any use or redistribution of this document or its contents without the express written consent of Quest is prohibited. This presentation contains statements that constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of Those statements appear in a number of places in the presentation and include statements regarding the intent, belief or current expectations of Quest, its directors or its officers with respect to, among other things: (i) trends affecting Quest s financial condition or results of operations; (ii) Quest s financing plans; and (iii) Quest s business and growth strategies, among other things. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors. You are cautioned not to place undue reliance on these forward-looking statements, which reflect Quest s management s view only as of the date of this presentation. This presentation is Quest Solution, Inc

3 Investment Highlights 1. Recent catalyst : merger of ViascanQdata and Quest Solution expand solutions, products offerings, footprint and geographic coverage Increase revenue per customer 2. Market leader in Supply Chain Optimization, barcode technologies / supplies with customers 3. 95% customer retention : Customers include Bridgestone, McKesson, Oakley, Sherwin Williams; 85%+ of largest 20 customers have been with Quest for 5+ years 4. A fully integrated turn key mobile solution provider offering: design, delivery, deployment and support 5. Multiple repeatable revenue sources (i.e. service and maintenance contracts, repair, barcode printing supplies) 6. Preferred relationships and partnerships with industry leaders (Zebra, Motorola, Honeywell, etc.) OTCQB TICKER: QUES Market Cap ~$5M Recent Closing Price $0.13 Shares Outstanding 42M 2015 Pro forma Revenue $80.3M 2015 Pro forma Adjusted EBITDA $1.56M 3

4 Quest Solution : Highlights Key Facts World HQ : 860 Conger Street, Eugene, OR 7000 customers,150 Employees $80.3M in revenues Public Company (OTC : QUES) registered in DE 3 plants, 3 wharehouses, 18 cities Our history Canada 4 offices, 2 factories Montreal: HQ Manufacturing, Sales Office 1994 : Quest was founded in Portland 2003 : Quest provides custom software after acquisition of DDS - Distributed Data Systems 2004: Quest adds Professional Services (deployment and project management) 2014 : Quest trades as a public company USA 14 offices, 1 factory Oregon: World HQ Sales Office 2014 : Merger of Quest and BCS (founded in 1994) 2015 : Merger of Quest and ViascanQdata (founded in 1995) Our Mission Optimize Enterprise Supply Chains by : Manufacturing Creating, delivering and supporting automatic identification data collection (AIDC), Field Mobility and Labeling solutions with superior customer service. 4

5 Our pillars The ecosystem of our offerings Service Consumables Infrastructure and devices Software Management Break fix, OEM Service contracts, RF Site Survey, Onsite service technicians Pressure sensitive labels, tags, ribbons, RFID tags Data collection equipment, wireless network, interfaces, and resources for your business needs Productivity Software & Deployment (POS, POD, Asset tracking, Voice solutions, etc.) We assist you in TCO (Total Cost of Ownership) Optimization

6 Services + Products Use Printers Print& Apply Software Labels, tags & ribbons (RFID and conventional) Mobile Devices Software (POD, DSD, Voice, Asset tracking) Scanners RFID readers Wireless Infrastructure Security Mobile Device Management ERP systems CRM MRP Analytics Deployment Services Consulting Design and Site Survey Deployment and Project Management Maintenance and Support Managed Services Mobile Device Management Mobile Application Management Help Desk 6

7 Our Verticals We service Fortune 500 companies from several sectors Transportation and Logistics Health Care Retail Chemicals, Oil and Gas Manufacturing Distribution Field Services Food / Beverage 7

8 Our customers Suppliers / manufacturers Distribution centers Transportation Stores Consumer / shopper Transportation / Logistics 8

9 Supply chain optimization : The Industry End Users Manufacturers Retailers Distribution centers Transport / Logistics Healthcare Products + Solutions + Integration + Support System Integrators Products (local) Brokers/ VARs Products.com Master Distributors Manufacturers 9

10 Barcode Printing Supplies : the industry End users Brokers Value add resellers Converters Coaters Pulp and paper 10

11 Our offering Revenue % by offering 13% 5 % Hardware Service Hardware Zebra/Motorola Platinum Channel Partner in the top 5 of the 2,500 Motorola resellers Enterprise Asset Visibility through the Internet of Things and the Cloud Services & LT Contracts QuestPros : daily rate service for specs, surveys, configuration, planning and management 19% 63% Barcode printing supplies Software Barcode Printing Supplies (Media) Converter for both labels and ribbons in our production facilities Software Proprietary and 3 rd party software, high margins and stickiness (Windows, Android, ios) Field Automation, Warehouse Automation, Retail & Device management Direct contracting with customers. Typical contract of ~1 year, renewable repeatable revenue streams 11

12 Market : Trends and our Industry Enterprise Mobility in 2020 (17% of which is in USA): 140 billion$ global market 1.3 billion mobile workers 30 billion internet connected devices 70 Zetta (ZB) of data 50 billion connected IoT devices Our Industry 80% of purchases use Mobility Ruged Mobile Devices = $4B industry / year Cloud Computing = new supply chain applications and mobile requirements IoT = Convergence of systems / devices / software Migration from Windows to ios and Android = Mobile Upgrades Retailer s focus on Omni Channel = supply chain investments in mobile devices and software 12

13 Market : Mobile Professional Services A fast growing industry with tremendous potential Market Opportunity $10B $8.5B $7B Global workforce has become more mobile. Handhelds are becoming more powerful and affordable Increase in spending across commercial industries Source: VDC Research Group projections of the Mobile Professional Services industry Increasing complexity of mobile solutions is leading to the need for customization. 13

14 Market : Barcode Printing Supplies 14

15 Growth Strategy Growth fueled by technology obsolecence, mandates, and renewable contracts Cellular Innovation 2G to 3G to 4G Mandated changes for 2D barcodes Explosion in consumer-grade devices driving need for services and software Ever-evolving operating system changes with ios, Android and Microsoft Solid base of renewable contracts 3 to 5 year renewal cycles Like the Insurance Agent adding different kinds of policies as the customer shares trust and the portfolio of major accounts grow 15

16 Growth Strategy Increase margins via services, repeatable revenue streams, barcode printing supplies Geographic Expansion Build revenues and margin through deeper and wider customer engagement Companies with major, long-term customer bases with opportunities to expand software / services Strategic Acquisitions Sustain and Grow Core Mobility Integration & Support Business for Supply Chain Customers Software / Product Expansion Expansion of routing software to include ERP system, Solution as a Software Field Services, Managed Services, Retail POS, RFID based asset tracking for healthcare, warehouse management, yard management Market Expansion 16

17 Executive Management Gilles Gaudreault, CEO Entrepreneur, financial expert, mergers and acquisition 35 years of financial and strategic transaction experience in manufacturing and technology companies Tom Miller, Chairman and President Automatic Identification and Data collection (AIDC) market experience as current SAGE consultant to resellers, manufacturers and distributors. Past President of Norand, Intermec (now Honeywell) and taking company through high growth and stockholder increases Joey Trombino, CFO CPA,CA is a seasoned accounting and finance executive with 20+ years of experience in software, manufacturing and technology sectors, in private and public corporations Joey began his career with KPMG as Senior Manager in the Audit Practice George Zicman, Sr. Vice-President Sales Over 30 years of experience in the mobile technology industry Prior to joining Quest, sales management for Telxon Corporation (in 1987) (later acquired by Symbol Technologies and then Motorola, then Zebra) 17

18 Summary Increased buying power Cost of raw material for barcode printing supplies lower, resulting in better GM% Better discounts from hardware manufacturers Cost of barcode printing supplies production in CDN$, leveraging on a weak CDN$ Repeatable revenues from barcode printing supplies = more predictable cash flow forecast Streamlined operations Reduced staff in back office (AP-AR-Admin) eliminating redundancies In depth partnerships with key suppliers (ex. Zebra, Honeywell) Top 3 in industry, # 1 in global offerings, Quest is becoming leading added value vendor. Quest works with the vendors in building new offerings, new trends, new products Coast to coast North American coverage Better accounts coverage Cross border selling Complete offering vs competition Sales forces will sell more products to their accounts (fixed sales cost, but more revenue) 18

19 Income Statement Revenues, net Gross profit Gross profit margin Interest expense (including non-cash interest accretion) Net income Earnings per share - basic Earnings per share - diluted Weighted average shares outstanding - basic Weighted average shares outstanding - diluted Deferred revenue, net For the Three Months Ended 30-Sept-15 $ 18,394,562 $ 3,818, % $ (892,544) $ (1,502,729) $ 0.00 $ ,947,978 39,947,978 $1,023,203 Refer to the financial tables at the end of the presentation for a reconciliation of GAAP results to Pro forma results and other Non-GAAP measures Adjusted EBITDA $ 34,413 19

20 Select Balance Sheet Summary ($ in thousands) 3/31/ /31/2015 Cash & Cash Equivalents $ 1,690 $ 1,533 Accounts Receivable, net 11,667 11,409 Total Current Assets 18,947 16,962 Goodwill and other assets Property & Equipment, Net 33,027 1,447 33,458 1,451 Total Assets $ 53,421 $ 51,871 Total Current Liabilities $ 40,805 $ 37,056 Total Long-Term Debt 14,956 15,285 Total Equity $ (2,341) $ (471) Total Liabilities & Equity $ 53,421 $ 51,871 20

21 2015 and 2016 Non-GAAP Measures Quest Solution, Inc. Unaudited Reconciliation of GAAP Measures to Non-GAAP Measures 3 months ending March 31, 3 months ending Dec 31, EBITDA Calculation: Net (loss) Income $ (1,502,729) $ (422,082) $ (1,725,195) $ 254,646 Depreciation & Amortization $ 495,587 $ 25,496 $ 2,633,122 $ 7,709 Income Tax (benefit) $ - $ - $ (1,785,524) $ (1,299,417) Interest Expense $ 892,544 $ 395,272 $ 597,822 $ 870,596 EBITDA $ (114,598) $ (1,314) $ (279,775) $ (166,466) Adjusted EBITDA Calculation: EBITDA $ (114,598) $ (1,314) $ (279,775) $ (166,466) Non Cash stock compensation $ 149,011 $ 38,624 $ 414,138 $ 224,238 Adjusted EBITDA $ 34,413 $ 37,310 $ 134,363 $ 57,772 Net Revenue $ 18,394,562 $ 10,675,970 $ 22,909,208 $ 11,169,105 ADJUSTED EBITDA % of Net Revenue 0.19% 0.35% 0.59% 0.52% 21