A Global Leader in Color Management Solutions

A Global Leader in Color Management Solutions  Financials  Company Overview  Industry Overview  Growth Targets and Strategy  Investment Highligh...
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A Global Leader in Color Management Solutions  Financials  Company Overview  Industry Overview

 Growth Targets and Strategy  Investment Highlights

September 2009

1

September 2009

Safe Harbor Statement This document has been prepared by the Company solely for the use at the Swiss Equity presentation in Zurich on September 16, 2009. The information contained in this document has not been independently verified and no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained herein. None of the Company or any of their respective affiliates, advisors or representatives shall have any liability whatsoever arising from any use of this document, or its contents, or otherwise arising in connection with this document This document does not constitute an offer or invitation to purchase shares and neither it nor any part of it shall form the basis of, or be relied upon in connection with any contract or commitment whatsoever.

September 2009

2

Financials



Bilanzstruktur



Umstellung von IFRS auf Swiss GAAP FER



Halbjahreszahlen 2008/2009

September 2009

3

Bilanzstruktur In CHF Mio.

31.03.2009 IFRS

Cash

12.6

Umlaufvermögen

17.6

Immaterielle Werte

12.9

Sonstiges Anlagevermögen

11.4

Total Aktiven

54.5

Verbindlichkeiten

20.0

Eigenkapital

34.5

in % der Bilanzsumme

63.3%

 Hohe Eigenkapital Quote  Netto-Cash Position September 2009

4

31.03.2009 Swiss GAAP FER

Anpassung

Umstellung von IFRS auf Swiss GAAP FER 31.03.2009 IFRS

31.03.2009 Swiss GAAP FER

Cash

12.6

12.6

Umlaufvermögen

17.6

17.6

Immaterielle Werte

12.9

3.8

Sonstiges Anlagevermögen

11.4

11.4

Total Aktiven

54.5

45.4

Verbindlichkeiten

20.0

19.1

(0.9)

Eigenkapital

34.5

26.3

8.2

63.3%

57.9%

In CHF Mio.

in % der Bilanzsumme

 Hoher Aufwand der Anwendung von IFRS  Vergleichbarkeit der Erfolgsrechnungen September 2009

5

Anpassung

9.1

Halbjahreszahlen 2008/2009 1. Halbjahr 2008/2009 (IFRS)

1. Halbjahr 2007/2008 (IFRS)

Veränderung

Nettoumsatz

26.4

37.7

(29.9%)

Industriegeschäft

20.0

31.0

(35.3%)

Konsumgeschäft

6.4

6.7

(5.3%)

EBITDA (angepasst)

-0.6

2.9

Abschreibungen und Amortisationen

-1.1

-1.0

EBIT (angepasst)

-1.7

1.9

Key Figures (fortgeführtes Geschäft)

 Weltweiter Wirtschaftsabschwung  Industriegeschäft: Aufschub oder Stornierung von Investitionen bei Kunden September 2009

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Company Overview

September 2009

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Color Management – Industrial Products 

Managing suppliers, materials and processes across complex supply chains and work flows to consistently and efficiently achieve the intended color

September 2009

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Color Management - Consumer Products

Un-calibrated monitors - No two monitors are the same

September 2009

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Color Management - Consumer Products

Calibrated monitors

September 2009

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Color Management 

Color Management Solutions Hardware, software and processes that solve the complex problems in achieving the intended color



Customer Value of Color Management Speed Quality Efficiency



Compress time to market Consistent color Reduce scrap

Color Management Markets: Some industries where color is mission critical: - Fashion and footwear - Automobiles, appliances - Consumer electronics - Home furnishings

September 2009

- Photography - Packaging - Printing - Food and beverage

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Overview Datacolor  

Unchallenged number two in global color management market Market leader in textile industry and monitor calibration

   

Founded 1970 Headquarters - Lawrenceville NJ, USA Offices - 11 countries Representation - 65 countries

  

Employees - 250 in 25 countries R&D – U.S., Switzerland, China Manufacturing – U.S., China

Milan Gent

Paris Manchester

Dusseldorf Zurich

Taipei Suzhou Shanghai Hong Kong Mumbai

Lawrenceville

September 2009

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World class facilities

Headquarters, NJ USA

Technical Center, Suzhou PRC

• R&D • Production • Administrative

• Opened 2008 • Production • Engineering

September 2009

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Business Model  Sustain and expand leading position in developing, manufacturing, and globally distributing precision instruments, software and services for leading edge color management solutions

 Primary Industrial customers are:  “Specifiers” in the supply chain (e.g. automotive)  Textile, leather, paint, plastics, paper producers

 Primary Consumer customers are:  Serious to professional photographers

September 2009

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Key Market Characteristics  Key market characteristics:  Shift to digital workflow creates demand for broader solutions and drives growth  Attractive potential in new segments  Technology-driven solutions  High entry barriers  Low capital investment, high cash flows

September 2009

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Balanced Portfolio Mitigates risk with favorable segment and regional mix % of Tota l Sa les 2 0 1 2

% of Tota l Sa les 2 0 0 8 Consumer

20

Consumer

%

35% Industrial

80%

Industrial

Organic Growth

65%

% of Tota l Sa les 2 0 0 8

Geographical sales are well balanced

American

Asia

29%

26%

Europe

45% September 2009

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Mix between Industrial and Consumer becomes more balanced due to faster growth of Consumer business

Comprehensive Portfolio – Industrial Hardware  Spectrophotometers  Color laboratory equipment

Software Spectrophotometers

 Matching  Quality control  Communication

Service and Support Software Product M ix Services Software

30

%

15%

Lab Equipment

Hardware

55% September 2009

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Strategic Focus Customers

Fashion & Footwear

Automotive Interiors

Paints and Plastics

The names, trademarks, September 2009 service marks, logos and icons of the above companies are properties of the respective companies.

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Preferred Supplier to Retail/Apparel Industry  80 of the top 100 Retailers have selected Datacolor.  Over 3,500 Apparel Suppliers rely on Datacolor equipment.

BHS

 Over 1,000 Apparel Suppliers are Accredited by Datacolor.

The names, trademarks, September 2009 service marks, logos and icons of the above companies are properties of the respective companies.

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Unmatched Portfolio – Consumer Products  Award-winning monitor and printer calibration solutions for digital photography workflows  Unique TV calibration solutions for home theater providers and enthusiasts

Target Customers

Spyder3 Print

 Serious to professional photographers

Distribution  Photo and electronics retailers – e.g. Media Markt  e-Tailers – e.g. Amazon  Electronics distributors – e.g. Globell  Datacolor web store % Sales by Region - Current

Asia

American

35

% Sa les by Region - Future

15%

%

American

Asia

Spyder3 Europe

50% September 2009

Europe

20

Current Market Shares HunterLab 4%

All others 6%

Konica Minolta 7%

Datacolor share in major market segments Fashion and footwear Photography X-Rite Pulp and Paper 59% Paint/plastics producers Retail paint Printing

Byk-Gardner 9%

Datacolor 15%

USD 650 million Served Market Chart data based on Datacolor estimates

September 2009

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65% 55% 65% 35% 20% 5%

Opportunities for Growth

September 2009

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Business Opportunity Will Grow  Clearly defined growth drivers - Importance of color as quality indicator - Decentralized and fragmented production - Fast transition to digital workflows

Consumer segment (professionals and enthusiasts) expected growth 15-20% driven by: - Growing adoption of digital SLR cameras - Lower priced, better displays Growth Rates – Served Market - Recognition of need to calibrate 25% 15-20% 20%

 Industrial segment expected growth 4-6% driven by: 15% - Replacement of analog color tools 10% - Need for broader solutions 5% - New business areas

4-6%

0% Consumer Segment

September 2009

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Industrial Segment

Focused Growth Strategy

Datacolor: - Strong No 2 in the industry

- Leadership in its focused market segments

September 2009

Accelerated product development and new services Entry into adjacent market segments seeking leadership position Selected acquisitions to expand technology base and market position New organization structure, gains in efficiency

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Accelerated Product Development New miniaturized sensor Will reduce size and cost of consumer products  Enables embedded solutions 

September 2009

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Accelerated Product Development

September 2009



Measurement of multicolor patterns is very restricted today



New imaging technology combined with current instruments will solve this problem



Instrument market will expand by at least 25%

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Strategic Entry into Adjacent Segments Furniture and Home Furnishings

Packaging Materials

September 2009

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Well-Defined Acquisition Strategy 



Strong balance sheet will support acquisitions Proven track record - acquisition and integration of Consumer business

September 2009

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Executive Team

Albert Bush

Brian Levey

Christoph Gamper

Doris Brown

Stefan Dobler

Rico Sauerborn

President & CEO

Industrial BU

Consumer BU

Marketing

CFO

Operations

V. President

V. President

V. President

 U of Leuven, Belgium

 U of CT, Connecticut

 MCI Innsbruck Austria

 R.I.T Rochester, NY

 Swiss CPA Zurich, CH

Bekaert

Dow Chemical  Beckman Inst.

 kdg mediatech ag  Koch Media AG

 X-Rite  PANTONE  Indocs Online, Inc.  Agfa/Bayer Corp.  Anitec /Kodak

 Eichhof Holding  Pricewaterhouse

V. President

strong domestic and international business development and marketing experience September 2009

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Sustainable Efficiency Improvements  Consistently lower cost instrument designs

New scalable manufacturing site in China  Manufacturing now concentrated in Suzhou  Cost-efficient production for export and local market  Capacity to produce at mid-term volumes

 Tightened industrial sales organizations  Strengthened web marketing  Efficient worldwide ERP platform supports lean processes

September 2009

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Investment Highlights 

Clearly focused “pure play” in the global market for color management solutions with above-average growth potential



Dynamic, exciting market space driven by technology innovations with high barriers to entry



Well balanced revenues from industrial and consumer markets, as well as from a geographic point of view



EBITDA Margin of 18% to 20% in the mid-term



Sustained organic growth driven by cutting-edge technology in hardware & software products, effective service packages and acceleration of development of adjacent markets



Well-positioned to benefit from economies of scale in distribution, production and information systems



Strong balance sheet allows to profit from industry consolidation and fast growing demand for color management solutions in the supply chains

September 2009

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A Global Leader Set for Growth

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