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ADDvantage Technologies Group

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This presentation may contain forward-looking statements. ... Universal Studios. Municipals. Large MSOs. Time Warner. Cox. Comcast. Charter. Cablevision ... – PowerPoint PPT presentation

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Title: ADDvantage Technologies Group


1
ADDvantageTechnologies Group
  • AMEX AEY
  • Investor Presentation March 2007

2
Safe Harbor
  • This presentation may contain forward-looking
    statements. All statements other than statements
    of historical facts, which address activities,
    events or developments that the Company expects
    or anticipates will or may occur in the future,
    are forward-looking statements. These statements
    are subject to risks and uncertainties, which
    could cause actual results and developments to
    differ materially from these statements.
  • A complete discussion of these risks and
    uncertainties is contained in the Companys
    reports and documents filed from time to time
    with the Securities and Exchange Commission.

3
ADDvantage at a glance
4
Who we are
  • We supply the cable television (CATV) industry
    with a comprehensive line of system-critical
    network equipment and hardware, and nationwide
    repair services.
  • ADDvantage products are used to acquire,
    distribute, and protect the broad range of
    communications signals carried on fiber optic,
    coaxial cable and wireless distribution systems.

5
Our history
June 2006 ADDvantage Technologies acquires the
assets of Broadband Remarketing International
November 1999 Lee CATV, a wholly owned subsidiary
of ADDvantage Media, merged withDiamond W
Investments
Nov 2003 ADDvantage Technologies began trading
on AMEX. Ticker symbol AEY.
1985 TULSATacquiredby David andKen Chymiak
March 2001 ADDvantage Technologies acquired NCS
Industries
December 1999 ADDvantageMedia changedname
toADDvantage TechnologiesGroup
August 2005 ADDvantage Technologies acquired
Jones Broadband International
May 2001 ADDvantage Technologies acquired
Fero-Midwest (dba ComTech Services
September 1999 Shareholders of TULSAT assumed
control of ADDvantage Media through a reverse
merger
October 2006 ADDvantage Technologies acquired
assets of Broadband Digital Repairs
6
ADDvantage subsidiaries
  • Tulsat
  • Tulsat - Atlanta
  • Tulsat - Nebraska
  • Tulsat - Texas
  • NCS Industries
  • Comtech Services
  • Comtech Services - Indiana
  • Jones Broadband
  • Broadband Remarketing International

7
A National Presence
Broadband Remarketing International
Tulsat Nebraska
ComTech Services
Tulsat
NCS Industries
Tulsat-Atlanta
Jones Broadband International
Tulsat / ADDvantage Headquarters
Tulsat-Texas
8
Our advantage
  • Largest inventory of CATV equipment, allowing for
    OnHand, On Demand service
  • Largest seller and service provider of new and
    refurbished CATV electronics equipment in the
    U.S. market
  • Industrys leading VAR - strong alliances with
    OEMs, including Scientific-Atlanta, Motorola,
    Blonder Tongue, Terayon
  • Expanding network of world-class repair centers,
    providing warranty and non-warranty services
  • Growing efficiencies within our operating model

9
Reliable Products
  • Expansive inventory of new and refurbished legacy
    CATV equipment, as well as digital and fiber
    optic broadband telecommunications equipment from
    major vendors.
  • Remarketing of converters both domestically and
    internationally.
  • One-stop shopping for all CATV equipment needs
  • Inventory of hard-to-find products
  • Wide variety of products in stock and readily
    available

10
Professional Services
  • Technical Expertise
  • Consult with customers on products and
    configurations
  • Provide customers with technical expertise from
    our experienced sales and support organization
  • Service Capabilities
  • Maintain world-class service centers at all
    locations
  • Provide warranty and repairs for all products
    sold
  • Analog
  • Digital
  • Fiber optic
  • Test equipment
  • Provide out-of-warranty repairs

11
Our core markets
  • Domestic Market
  • Target customers - 6,000 U.S. CATV systems
  • More than 1,400 active accounts
  • 32 of 2006 revenues came from top 5 customers
  • Technology convergence of video, voice and data
    delivery systems
  • Changes in the market are expanding the potential
    client base to include RBOCs, independent
    telecoms and utilities
  • International Market
  • Distribution agreement in Latin America and South
    America with Scientific Atlanta
  • Customer base in Latin America through Jones
    Broadband International

12
Current Market Trends
  • In the US and abroad, customers are in the infant
    stages of VOIP and HSD, while IPTV and Wireless
    are set to follow
  • HDTV continues to thrive
  • Cable telephony and Converged IP Services over
    cable are growing at a rapid pace
  • Growing demand for bandwidth and speed, owing in
    part to the popularity of media-rich sites such
    as YouTube.

13
Strategy for Long Term Growth
  • Expand domestic and international sales forces
  • Enhance relationships with leading OEMs and
    increase special distribution agreements
  • Grow technical repair service via additional
    regional service centers
  • Explore VAR opportunities with key suppliers and
    branded manufacturers
  • Broaden new industry sales efforts RBOCs,
    independent Telecoms and utilities
  • Complement organic growth with strategic
    acquisitions
  • Build upon product portfolio to supply the most
    up-to-date offerings

14
Acquisition Criteria
  • Entry into new markets
  • Strong platforms that complement core business
  • Market leader in under-served markets
  • Strong market presence
  • Reliable service after the sale

Circle the Customer, Circle the Globe
15
Our valued customers
  • Private Cable Companies
  • Business Networks
  • Hotels
  • Hospitals
  • Apartments
  • School Campuses
  • Telephone
  • Competitive Service Providers
  • Disney
  • Universal Studios
  • Municipals
  • Large MSOs
  • Time Warner
  • Cox
  • Comcast
  • Charter
  • Cablevision
  • Mid-Market MSOs
  • Cebridge
  • Cable One
  • Independent CATV

16
Key OEM Relationships
  • Master Stocking Distributor for most new and
    legacy products and other broadband equipment
  • Exclusive relationship in the U.S. and Latin
    America for certain legacy products
  • Authorized third-party repair center for legacy
    and end-of-life products
  • One of two preferred VARs for broadband and
    transmission equipment

17
VAR Partners
18
Year-Over-Year Growth
19
Revenue and Gross Profit Mix
2006 Revenue Mix
2006 Gross Profit Mix
Service 10
Service 10
Refurbished Products 17
Refurbished Products 26
New Products 64
New Products 73
20
Financial Performance
Statement of Operations

21
Selected Financial Data
Balance Sheet Data
22
Capital Structure
  • Common Stock (as of 1/31/07)
  • Outstanding 10.2 million shares
  • Authorized 30 million shares
  • Ownership (as of 1/31/07)
  • Public Float 5.9 million shares
  • Insider Holdings 4.3 million shares
  • Dave Chymiak, Chairman
  • 2.3 million shares 23
  • Ken Chymiak, President and CEO
  • 2.0 million shares 21
  • Preferred Stock (as 1/31/07)
  • Series B, 7 cumulative - 12 million

23
Senior Management
  • Dave Chymiak Chairman of the Board
  • 20 years in the CATV industry
  • Ken Chymiak President and CEO
  • 20 years in the CATV industry
  • Dan OKeefe Chief Financial Officer / Vice
    President and Secretary

24
Industry Veterans Heading our Subsidiaries
  • George McIlvain General Manager, TULSAT-Atlanta
  • 21 years in with Scientific-Atlanta, Joined ATG
    in 2002
  • Johnny Lopez General Manager, TULSAT-Texas
  • 28 years in the CATV industry
  • Nick Ferolito President and General Manager,
    ComTech Services
  • 21 years in cable television industry
  • Co-founded ComTech in 1984 sold to ATG in 2001
  • John  Noojin Sales Manager, Tulsat-Nebraska
  • 27 years sales experience
  • John Denner Service Manager, Tulsat-Nebraska
  • 37 years in the CATV industry
  • Mark Schumacher Sales Manager, TULSAT
  • 26 years in the CATV industry

25
Investment Considerations
  • Accretive to earnings
  • Unique one-stop-shopping through large inventory
  • Established position in 10.13 billion cable
    equipment and services industry
  • Expanding repair services geographically
  • Favorable market trends
  • Strong financial position
  • Broad product and service offerings
  • Growing demand for bandwidth and speed
  • Established relationships with leading OEMs
  • Proven and experienced management team

Source Kagan Research, LLC. - Estimated cable
industry infrastructure expenditures in 2004
26
ADDvantage Technologies Group1221 East Houston
St.Broken Arrow, OK 74012
ADDvantageTechnologies Group
  • Tulsat Tulsat-Atlanta Tulsat-Nebraska
    Tulsat-Texas
  • NCS Com-Tech Services Com-Tech
    Services-Indiana
  • Jones Broadband Broadband Remarketing
    International
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