Welcome to. Annual Shareholders Meeting 2013
2012 Performance infrastructure & services for global communications Disappointing revenue and net income performance 2012 full year revenue of $104,200,000 2012 full year net income of $2,200,000 Transition Networks Challenging comparable revenues and profits to 2011 Slow down in Federal Government and legacy products JDL Had a slow down in their large education customer in 2012 which led to a loss for the year. Won part of Miami-Dade Bringing Wireless to the Classroom initiative - $23 million Suttle Strong year with improved housing market and new product opportunities
Continuous Improvement infrastructure & services for global communications New Enterprise Resource Planning (ERP) system Selected IFS as our partner Offers improvements from product development, manufacturing, to customer service CSI and Transition Networks unit went live on April 4, 2013 Suttle unit will go live in Q4 of 2013 and JDL by Q2 2014 Continued investment Investment in our people and the tools to support them Need to continue to add capabilities to the organization and adapt to changing markets
Acquisitions Patapsco Integration Engineering complete Developing products that combine Patapsco and Transition Networks technology Manufacturing complete with exception of low volume products Pursuing new sales opportunities globally Current search has slowed
Q1 2013 infrastructure & services for global communications Slight improvement over Q1 2012 Strong financially $27.7mil cash and $69mil in working capital Continue to support dividend Continuing to invest with long-term horizon Engineering, Sales, Marketing, ERP Future Opportunities in each business unit New products, services, and global expansion
Financial Results 2012 Annual Figures infrastructure & services for global communications Public Company Since 1981 Every Year Profitable Listed on the NASDAQ Stock symbol: JCS Revenues $104,250,000 Total Assets (12/31/12) $112,535,000 Net Income $2,238,000 Earnings Per Share $0.26 Dividends Per Share $0.64 Stockholders Equity (12/31/12) $93,995,000 Market Cap (12/31/12) $88,139,000 Shares Outstanding (12/31/12) 8,474,896
Financial Results Q1 2013 Figures infrastructure & services for global communications Public Company Since 1981 Every Year Profitable Listed on the NASDAQ Stock symbol: JCS Revenues $27,453,000 52 Week Range (3/31/13) $9.73 - $14.09 Total Assets (3/31/13) $111,070,000 Net Income $242,000 Earnings Per Share $0.03 Dividends Per Share $0.16 Stockholders Equity (3/31/13) $92,971,000 Market Cap (3/31/13) $83,703,000 Shares Outstanding (3/31/13) 8,523,719
Transition Networks
Restructuring May 15 th press release Business unit revenues and profits underperforming Slow down in Federal Government business New management Search for new VP and General Manager Change in sales management Realign U.S. sales team Restructure some costs Continued investment required
Strategic Focus Staying focused & aligned on key customers and markets Expansion within Enterprise, Government, Telco markets Expansion of capabilities and solutions Focused geographic expansion
Service Provider Business Ethernet services Wireless backhaul New Network Interface Devices (NID) Legacy support with Patapsco Data Center Co-locations New Solutions Converge TM management software (EMS) 10 Gig devices Fiber aggregation Combined Transition and Patapsco technology Services & Support
Enterprise Increased Channel Engagement Focused Market Targeting Fortune 1000 State & Local Government Education Datacenters Physical security Outdoor harsh environments New Technology 10 Gigabit Ethernet Fiber aggregation Power over Ethernet Network Interface Devices
Federal Government New Opportunities New agencies Deeper relationship with strategic partners Primary contractors Telecommunication services Solutions ION chassis security Patapsco products (ISDN) Network Interface Devices
Strategic Focus Organization aligned with vertical market focus Growing technical sales team Globalization Key groups expanded on three continents Global Engineering group R&D; emphasis on software Test, Verification, Interoperability Global technical support Transactions in multiple currencies for better localization Localized logistics Additional resources in country
JDL Technologies
About JDL Technologies infrastructure & services for global communications At our heart we are an IT services company Technology is in our DNA Provider of information technology (IT) products, services and solutions 15-year proven track record in South Florida (Ft. Lauderdale) Expanded into Central Florida in January (Tampa/Orlando), with plans to continue northward expansion Loyal, long-term clients as well as new acquisitions Wide range of specialties: Outsourced IT Management (Managed Services), Virtualization at both the desktop and the server level, and Networking from architecture to installation to management of wired and wireless networks Design, test, deploy, manage, update
JDL Continues to Build True Differentiation in IT Bench Strength: Nearly 70% of staff are engineers and technical experts Knowledge: More than 300 years of technical experience Expertise: More than 115 industry and professional certifications Support: State-of-the-art Managed Services operations center Solutions: Powerful partnerships with marquee IT providers and upcoming IT innovators
JDL Target Markets infrastructure & services for global communications Leverage strong existing client segments to build out strategic verticals: Education Public School Districts Private K-12 Public and Private Higher Ed Commercial Small to mid-size businesses (SMB) 50 to 1,500 employees Manufacturing Construction Transportation Financial Healthcare Private practices Medical centers Diagnostic, wellness www.jdltech.com
JDL Solutions Deliver Significant Value infrastructure & services for global communications Enabling clients to: Manage costs while increasing efficiency, productivity and performance Increase workplace flexibility and agility Enhance end-user experience Upgrade network availability Improve security Ensure disaster recovery and business continuity
Strategic Focus for 2013 infrastructure & services for global communications Grow Education Footprint 2012 - Added Miami-Dade County 2013 Added Bradford, Collier, DeSoto, Monroe Counties Drive Annuity-Based Business Managed IT Services (JDL TechWatch) Leverage Core Competencies in Demand Virtualization (Desktops, Apps, Servers, Storage) Network design and deployment (Wired and Wireless) IT infrastructure configuration and deployment
Top 2013 Initiative infrastructure & services for global communications Help IT Manage BYOD (Bring Your Own Device) o BYOD Drivers Increased demand for mobility, remote work Consumerization of technology Proliferation of smart devices (smartphones up 27% to 918M units; tablets up 49% to 190M units 2013) Virtualization at desktop and application levels o Challenges 48% of IT pros say BYOD has resulted in significant fraud risk More than 1/3 say BYOD has resulted in malware and virus infections that infiltrated company network 77% say lack of security on devices presents significant risk o JDL Solutions MDM, including encryption at end-point Managed services, including network monitoring and security Virtualization and Network Design/Deployment Ponemon Institute, Communications Feb 2013; IDC Systems, 2013 Inc
Top 2013 Initiative infrastructure & services for global communications Bring Enterprise-Level IT to SMBs Challenges Limited or non-existent IT resources Pain points similar to larger enterprises, but risks have more serious consequences Compelled to focus on business-critical activities SMB Facts Florida has 1.785 million businesses with 100-1,000 employees Florida ranks #5 in US for favorable small business tax climate (without state corporate income tax, ranks #1) 90% who suffer data loss due to some form of disaster go out of business JDL Solutions Managed services U S Census; Tax Foundation 2013
IT Investment Outlook is Favorable infrastructure & services for global communications Worldwide IT Spending Forecast (In Billions USD) Gartner 2012 Spending Growth 2013 Spending Growth 2014 Spending Growth Devices 627 2.9% 666 6.3% 694 4.2% Data Center Systems 141 2.3% 147 4.5% 154 4.2% Enterprise Software 278 3.3% 296 6.4% 316 6.8% IT Services 881 1.8% 927 5.2% 974 5.1% Telecom Services 1,661-0.1% 1,701 2.4% 1,742 2.4% Overall IT 3,588 1.2% 3,737 4.2% 3,881 3.8% 45% of total IT spending worldwide comes from SMBs Gartner, January 2013
Enabling IT to do More Three-Time 2013 Winner! Partner of the Year Hot Growth Company Hot Expansion Company
Suttle
Strategic Objectives Continue to Drive Collaborative Customer Engagement Model to Deliver Innovative Solutions for Leading Communication Service Providers Enable the Truly Connected Home Strengthen Investment in Organizational Capabilities Experienced, Talented, and Engaged Workforce US and Costa Rica Fiber Operations Strategic Partnerships Continue Global Expansion Latin America Middle East Canada APAC
Evolving Communications Market Market Forces Suttle Traditional Products Utilized Inside the Home Drive for higher speed connections Global Fiber To The Home deployments Demand for connected devices
Delivering Innovative, Customer-Centric Solutions Suttle Customer Engagement Model Operational Capabilities FIOS U-verse Technology & Market Expertise Innovative Customer- Centric Solutions Knowledge of Customer Business Strategies Prism Strategic Partners Customer Relationship s Sales & Mktg
New Solutions for the Communications Network Suttle Products in Three Key Network Locations Outside Plant Fiber and Copper Connectivity Fiber and Copper Premise Distribution Active and Passive
Copper Outside Plant and Connectivity Solutions FutureLink TM enhanced copper solutions support high speed Fiber To The Node and IPTV deployments and xdsl technologies.
Fiber Outside Plant and Connectivity Solutions FutureLink TM fiber solutions scalable, stackable, indoor/outdoor support Fiber To The X deployments.
Active Premise Distribution for the Truly Connected Home
Conclusion Expanded capabilities make it possible for Suttle to consider attractive market opportunities. Suttle is prepared to meet the needs of global markets with innovative product platforms. Experienced, talented and engaged Suttle team is assembled to serve customers in global markets.
Thank You Questions and Answers.