Redline Communications - Investor Update - November 2013
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Transcript of Redline Communications - Investor Update - November 2013
© Redline Communications Inc. 2012. All rights reserved.
1 | 1 | rdlcom.com
Fall 2013
An Introduction to Redline Communications
Rob Williams, CEO
© Redline Communications Inc. 2012. All rights reserved.
2 | 2 | rdlcom.com Forward-Looking Statements
From time to time Redline makes written and oral statements that constitute forward-looking information within the meaning of applicable securities laws (“forward- looking statements”). Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Business, or developments in Redline’s industry, to differ materially from the anticipated results, performance, achievements or developments expressed or implied by such forward-looking statements. Forward-looking statements include all disclosure regarding possible events, conditions or results of operations that are based on assumptions about future economic conditions and courses of action. Forward- looking statements may also include, without limitation, any statement relating to future events, conditions or circumstances. Redline cautions you not to place undue reliance upon any such forward-looking statements, which speak only as of the date they are made.
These statements may include, but are not limited to, comments about: our objectives and priorities for the future, our strategies, expectations for our financial condition, the outlook for our operations, and external factors that may impact results, including global economies and industry trends. Forward-looking statements are based on management’s current plans, estimates, projections, beliefs and opinions, and Redline does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change. We caution that this list is not exhaustive of all possible factors. Other factors could adversely affect our results. For more information, please see the discussion on the principal risks that could affect our results, which is included in our most recent MD&A and in our latest annual information form, available on SEDAR at www. sedar.com. The assumptions behind our outlook are also discussed in our public filings.
© Redline Communications Inc. 2012. All rights reserved.
3 | 3 | rdlcom.com
Designs, builds and manufactures high-performance, rugged, high-speed wireless network equipment
Enables Machine-to-Machine (M2M) communication for industrial applications
Software-defined radio platform
Very large and diversified customer base in wide geographic regions in Energy, Industrial, Military, Public Safety, Telecom
Redline
© Redline Communications Inc. 2012. All rights reserved.
4 | 4 | rdlcom.com
Publicly traded on Toronto Stock Exchange - RDL
135 employees in 15 countries, offices in Canada, USA, Europe and Middle East
90% of revenue comes from outside Canada, customers in 70 countries in energy, telecom service provider, municipal governments, military
$30M¹ in revenues in 2012, approximately 40% from Energy Sector
Redline
¹ net of WIMAX
© Redline Communications Inc. 2012. All rights reserved.
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Oil and Gas industry requires reliable, secure, high speed networks in
some of the toughest places on the planet
Redline has a unique differentiated solution for this market
Key Market – Oil and Gas
© Redline Communications Inc. 2012. All rights reserved.
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Oilfield Challenges
Large geography lightly populated with people and machines, harsh environment
Very expensive operations
Complex communications needs: M2M, access to internet and corporate systems, video for collaboration and surveillance for safety
Typically no wireless carriers except satellite, fiber is very expensive, other terrestrial wireless systems fail to deliver
© Redline Communications Inc. 2012. All rights reserved.
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Mobile Drilling Rig
Battery Tank RTU - Remote Terminal Unit PLC - Programmable Logic Controller
Emergency Response
Work Vehicle CWE - Collaborative Work Environment
Process Domain
Video Monitoring
To HQ Central Control Room SCADA Systems
SMART OILFIELD Well Pad
Field Office
Well Head Automation
Mobile Field Connectivity
Operational Video Surveillance
Micro Seismic Applications
Asset Tracking via RF-ID
Energy Management
Collaborative Working Env.
Smart Drilling
SCADA Wi-Fi
Powerful and Versatile Wireless
© Redline Communications Inc. 2012. All rights reserved.
9 | 9 | rdlcom.com
Mobile Rapid Alignment System
Drilling Rigs
Mobile Field Offices
Maintenance Vehicles
Long-Range Mobile Broadband
© Redline Communications Inc. 2012. All rights reserved.
10 | 10 | rdlcom.com
Rugged, Reliable and Secure Wireless
Lowest meantime between failure, widest temperature range Highly secure, FIPS 140-2 certified, approved for Military use
© Redline Communications Inc. 2012. All rights reserved.
11 | 11 | rdlcom.com
LTE vs Redline in an Oil Field Network
5.8 GHz Band, 10 Mhz Channel
Speed 5.3 Mbps Down, 2.6 Mbps Up
LTE
14 Towers 7 Towers
1,200 KM2 Coverage 1,200 KM2 Coverage
5.8 GHz Band, 10 Mhz Channel
Speed 5.3 Mbps Down, 5.3 Mbps Up
Redline
© Redline Communications Inc. 2012. All rights reserved.
12 | 12 | rdlcom.com
MILITARY:
PUBLIC SAFETY AND WELL-BEING:
TELECOM SERVICE PROVIDERS:
ENERGY :
Customers
ORASCOM
DEA
© Redline Communications Inc. 2012. All rights reserved.
13 | 13 | rdlcom.com
Sell and manage directly, install with local partners
Strategic Partners include Cisco, Honeywell, ABB and other Systems Integrators
Revenue comes from:
+ product sales
+ professional services
+ recurring support revenue
+ functionality upgrades via software
Each oilfield can support $2M to $5M of Redline revenue over several years, currently 21 fields in various stages of deployment plus many fields in pilots
Redline Business Model
© Redline Communications Inc. 2012. All rights reserved.
14 | 14 | rdlcom.com
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Q1 Q2 Q3 Q4 Q1 Q2 Q3
2012 2013
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Reported Revenue (net of WiMAX)
Normalized Revenue
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20%
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80%
Q1 Q2 Q3 Q4 Q1 Q2 Q3
2012 2013
Gross margin %
© Redline Communications Inc. 2012. All rights reserved.
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Energy Revenue
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Q1 Q2 Q3 Q4 Q1 Q2 Q3 Backlog
2012 2013 Backlog
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Energy Revenue
© Redline Communications Inc. 2012. All rights reserved.
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EBITDA
-3
-2
-1
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Q1 Q2 Q3 Q4 Q1 Q2 Q3
2012 2013
Adjusted EBITDA
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Dec 12 Sept 13
Mill
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Cash