Presentation Collins Stewart, LLC Fourth Annual Growth Conference
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Confidential & Proprietary RF Monolithics, Inc.
Collins Stewart, LLCCollins Stewart, LLC
Fourth Annual Growth ConferenceFourth Annual Growth Conference
July 9, 2008July 9, 2008Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
This presentation contains forward-looking statements that involve risks and uncertainties. Statements of the Company’s plans, objectives, expectations and intentions and statements containing terms such as “believe”, “expects”, “plans”, “anticipates”, “may” or similar terms are considered to contain uncertainty and are forward-looking statements. Similarly, statements that describe the Company’s business strategy, outlook, objectives, plans or goals also are forward-looking statements and are based on information available to management at the time of such statement. Such statements are not guarantees of future performance and involve risks, uncertainties and assumptions, including risks related to the ability to integrate the acquisitions as planned, the ability to compete in the highly competitive markets, rapid changes in technologies that may displace products and services sold by the combined company, declining prices of networking products, the combined company's reliance on distributors, delays in product development efforts, uncertainty in consumer acceptance of the combined company's products, changes in the company’s level of revenue or profitability, expectations and stability of the international business environment in which the company operates, availability and cost of raw materials and labor, loss of major customers or significant change in demand from company forecasts, projections of future performance, future financial and operating results, as well as the other risks detailed from time to time in the Company’s SEC reports, including the report on Form 10-K for the year ended August 31, 2007. The company does not assume any obligation to update any information contained in this release. This disclosure speaks as of the date of its most recent posting July 9, 2008, and the Company cannot assure its accuracy after that date and does not undertake to update the disclosures contained herein.
Confidential & Proprietary RF Monolithics, Inc.
RFM Value Creation Strategy for Customers and Shareholders
1979 thru 2006Core Business RF Components
+2006 / 2007
Move Toward BecomingM2M Solutions Company
● Expanded product offerings through acquisitions;
become the leader in growing M2M marketsgrowing M2M markets
– Condition Based Monitoring and Control
2007 / 2008Financial Growth in
M2M Solutions
+– Improve Margins – Control Expenses
● Maintain strong financial position
– Grow Revenue
Higher Value● Higher value solutions provider for
customerscustomers… higher valuation company for
shareholdersshareholders
• Build upon our established profitable, cash profitable, cash
generating core businessgenerating core business in Wireless
Components and low power radio technology
Confidential & Proprietary RF Monolithics, Inc.
Wireless Connectivity
FILTERS & FREQUENCY CONTROL
COMPONENTS
Wireless Connectivity
LOW-POWER COMPONENTS
SimpleSimple ConnectivityConnectivity to millions of processes,
devices, and machines
Wireless Wireless ComponentsComponents Group Group
Confidential & Proprietary RF Monolithics, Inc.
Telemetry and Data Acquisition
SAW-BASED AND RFIC SHORT-RANGE RADIOS
Wireless Sensor Networking
READY-MADE RF MODULES
FOR OEMS
Asset Management and Maintenance
ENTERPRISE ASSET MGMT WITH
CONDITION-BASED MAINTENANCE MGMT
GlobalGlobal ConnectivityConnectivity to billions of processes, devices,
and machines
Wireless Wireless SolutionsSolutions Group Group
Confidential & Proprietary RF Monolithics, Inc.
Gross Profit Margins
60%
50%
40%
20%
30%
Transforming Margins● Commitment to leadership
position in the emerging M2M market
● Broadest embedded module offering in the marketplace based on various radios
● Emphasis on increasing gross margin and optimizing operational efficiencies
● Value-added application and services software capability for enterprise-class EAM and CMMS deployments
Components
Modules
Softwareand
Services
Confidential & Proprietary RF Monolithics, Inc.
>8% IncreaseIn RevenueRevenue
Revenue and Margin Expansion
● Product Mix Shift towards Wireless Solutions
● Fabless business model for components
GoalIncreased RevenueExpanded Margins
Move Toward M2Mwith the Creation of
Wireless Solutions Group
Gross Margin
>28% IncreaseIn Gross Margin
Revenue($M)
45
40
20
25
30
35
3Q08
4 Quarter Trailing Averages on a Quarterly Basis
4Q05 GPM
$16
$14
$12
$10
Confidential & Proprietary RF Monolithics, Inc.
Economic Pressure Refine Focus
• Two Distinct Offerings
– Sizable, Profitable Hardware Products Offering, with Positive Cash Flow
– Solutions Offerings for Emerging Markets Requiring Continued Ongoing Investment and is not yet Profitable
• Monitoring near term indicators and events to determine our level of investment
• Returning to Profitability and Positive Cash Flow
Confidential & Proprietary RF Monolithics, Inc.
Decisive Actions
• Fabless Business Model (~$5.0M in Annual Savings)
• Consolidation, Centralization and Process Efficiency Initiative (~$1.7M in Annual Savings)
– Restructuring
– Reorganization
• Consolidating Office Space (~$400K in Annual Savings)
Confidential & Proprietary RF Monolithics, Inc.
Growth Opportunities
• Chinese Cellular Base Stations – Filters
• Satellite Radio Penetration – Filters
• Medical – Low Power Radios, Modules
• Vehicle Tracking – Low Power Radios
• M2M – Single Chip ZigBee Modules
• Facilities Management – Custom Module Solutions
Confidential & Proprietary RF Monolithics, Inc.
FinancialFinancialHighlightsHighlights
Confidential & Proprietary RF Monolithics, Inc.
Q4’08 Guidance
• Overall Flat to Slightly up from Q3’08F
• Sales: $12.5M - $13.5M.
• Gross Profit Margin: 35.0% - 37.0%
• EPS: Non–GAAP Loss $0.04 - $0.09 / share
Confidential & Proprietary RF Monolithics, Inc.
2008 FY Estimates
• Sales - $56.0-57.0M. Flat with ‘07F
• Gross Profit Margin – 37-38%
Approx 500 Basis Points Improvement
• Non-GAAP EPS Loss: $0.03-$0.05 / share
• Full Year Operating Cash Flow Neutral to a
Small Net Cash Investment
Confidential & Proprietary RF Monolithics, Inc.
Summary
• Building upon a core profitable and positive cash flow Hardware business
• Implemented a series of cost reduction initiatives
• Monitoring near-term events to determine investment levels in the new business based on a goal of profitability and positive cash flow by early in calendar year ‘09
Confidential & Proprietary RF Monolithics, Inc.
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