2010 august investor telular

8/8/2019 2010 August Investor Telular

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August 2010

LOSE THE LINE. KEEP THE CONNECTION.


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Safe Harbor St at em ent

Some of the financial results contained in this presentation are preliminaryand un-audited. In addition, this presentation may contains forward-looking statements regarding future events or the future financial andoperational performance of Telular Corporation. Words such as targets,expects, believes, anticipates, intends, may, will, plan,continue, forecast, remains, would, should, and similar

expressions, are intended to identify forward-looking statements. Forward-looking statements are based on current expectations, are not guaranteesof future performance and involve assumptions, risks, and uncertainties.Actual performance may differ materially from those contained or implied insuch forward-looking statements. Risks and uncertainties are discussed inour 10-K. Additional information regarding factors that potentially couldaffect the business, financial condition and operating results of TelularCorporation is included in the company's periodic filings with the SEC onForms 10-K, 10-Q and 8-K. Telular Corporation expressly disclaims anyintent or obligation to update any forward-looking statement, except asotherwise specifically stated by it.


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Leading M2M (Machine-to-Machine) solutions andfixed wireless company, leveraging wireless networksto deliver critical data

Business Focus

Security systems, tank monitoring, remote telephonyTarget Markets

Founded in 1986; Public since 1994 (NASDAQ: WRLS)

Founded

Chicago, IllinoisHeadquarters

78 Full-Time EmployeesEmployees

Telu lar - Com pany Snapshot


4/22

K ey Inves tm ent H igh light s

16 consecutive quarters of profitability from continuing operations

Solid recurring service base comprising over 50% of total revenues

Over 550,000 Telguard subscribers and guidance revised upwards

Tightly managed cost structure

Successful repurchase program in 2009 (repurchased 22% of totaloutstanding shares @ $1.97/share)

Ended Q3 2010 with $24.6 million of cash and no debt


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Core Com pet enc ies

Strong history of designing specialty electronics fortransmitting voice and data over cellular networks

Operating a real-time message and eventprocessing system

International distribution channels

Premium brand and reputation

Veterans of arduous carrier certification process

Management of outsourced contract manufacturers


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7/22

Provides UL-listed primary & backup alarm solutions

Complete Line of Commercial and Residential Products Represents 85% of total revenue

Preferred choice for independent alarm dealers

Growing trend of wireless cell-only households driving growth

Telguard

3Q10 Highlights:

Recurring service revenue up 23% YOY

Over 558,000 subscribers

Released new TG-1 Express

Launched Telguard Advantage program


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Tel guard Di gi t a l - How i t w ork s


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Telgua rd - Marke t Oppo rt uni t y

Existing Home Security Market 1 in 6 homes and 2 of 3 businesses (22.4 million total premises) have a monitored security system

$6.4 billion in recurring annual monitoring revenues

15% new adds per year offset by 15% attrition

Average Recurring Monthly Revenue of $25

Customers stay for average of 7 years (15% annual churn rate)

Cellular Digital Alarm Communicator Market Growing trend toward wireless security as more homes are cell only

22.7% of households were cell phone only in 1st half of 2009 (20% increase over prior 6 months)*

Dealers starting to install cellular as primary in anticipation of an eventual land-line termination

About 65% of total Telguard units sold in FY 2009 installed as primary communication (cellular only)

Approximately 10% of 22.4 million monitored homes select a cellular communicator, leavingsignificant room for further penetration**

*CDC**Internal Estimate


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Telguard Compet i t i ve Advan tages

Telguard is t he mar ket leader

Universal interface to security panels

Fastest activation process for installers

Full data from panels (identifies which zone tripped)

Extensive distribution channels

Broad product line vs. single product competitors


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Te lgua rd - St rong Custom er Base


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M2M Supply Chain Managem ent

Tank monitoring services for petroleumand chemical distributors

Leverages Telulars existing, wirelessdata service

Wireless monitoring of inventory levels

Helps clients optimize inventory with just-in-time delivery

Future opportunities to replicate thebusiness model into new verticals

Telular can monitor various sensors fortemperature, fill level, location, etc.


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Tank L ink - How i t w or k s


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TankL ink H igh li ght s

Strategic agreement with Telefnica to expand intoLatin America

Significant growth potential into new markets

Differentiated product features include outdoor(ruggedized) and low-power (battery-driven)

Acquisition by Telular has improved leadership andsales/support processes

Higher product ASP and service ARPU than security


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TankL ink - Marke t Opport uni t y

Business model is similar to Telguard with a hardwaresale and a high margin, recurring service revenue

Current customer segments include fuels, lubes, andchemicals

Fuels & lubes have an estimated 4.3 million tankscombined*

Overall penetration is very small (low single digits*)

Chemical industry is more fragmented, but has higherARPU than fuels & lubes

No large competitors in the market

* Internal Estimate


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Termina ls Bus iness

Voice/data/fax communications overcellular networks

Used for special applications

Construction sites

Mobile command centers

Small office / home office (SOHO)

Recreational vehicles

Least cost routing

Competitive advantages Feature-rich and cost efficient

Reliability and strong brand

Key distribution relationships

Experts at the carrier-approval process


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Capitalize on the rising wireless trend to drive Telguardsales even further

Grow TankLink sales via large account focus

Continue to tightly manage our cost structure Maintain strong balance sheet and generate cash

Build shareholder value opportunistically when possible

Grow recurring revenues as a portion of our totalrevenues

2010 St ra teg ic In it ia t i ves


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Name Responsibility Experience Background

Joseph Beatty President & CEO +23 years - Telecom industry veteran- CFO, Telular- President & CEO, Concourse Comm.- CFO, Focal Comm. Corp.

Jonathan Charak SVP & CFO +18 years - Cross functional business experience- CFO, Vanderbilt Financial- CFO, Concourse Comm.

Ex per ienc ed Management Team

Larry Ford Chairman of Board +40 years - Telecom experience- SVP, ADC Telecom- CIO, IBM

Board of Directors:Brian ClucasLawrence BarkerBrian McCarthyLarry FordJoseph BeattyBetsy Bernard

Jeffrey Jacobowitz


21/22

K ey Inves tm ent H igh light s

16 consecutive quarters of profitability from continuing operations

Solid recurring service base comprising over 50% of total revenues

Over 550,000 Telguard subscribers & guidance revised upward

Tightly managed cost structure

Successful repurchase program in 2009 (repurchased 22% of totaloutstanding shares @ $1.97/share)

Ended Q3 2010 with $24.6 million of cash and no debt


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August 2010

2010 august investor telular

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