SENSIO Technologies Corporate Presentation May 2011

SENSIO TECHNOLOGIES CORPORATE PRESENTATION

NICHOLAS ROUTHIERPresident and CEO, SENSIO Technologies Inc.

May 2011

5/16/2011

3D PIONEERS

First live 3D simulcast on multi-platform; cinema, stadium and home, with ESPN (2009)

First worldwide live 3D event in cinemas: FIFA World Cup soccer (2010)

First live 3D event in theatres: BCS Bowl (2009)

First 3D technology to be standardized: DVD Forum (2009)

First Full HD 3D for broadcast (2008)

First satellite transmission of 3D content with Cinedigm (2007)

First Live 3D solution demonstrated with IDC (2007)

First 3D console game using SENSIO –Ubisoft: Avatar: The Game (2009)

First proprietary format integrated into a mass market 3DTV: Vizio (2010)

Integration into chips from 6 major chipmakers including Mediatek, Trident, Sigma Design.

12 YEARS CREATING THE INDUSTRY

• Founded in 1999 by current CEO and EVP

• Specialized in the development and marketing of stereoscopic (3D) image-processing technologies, and supporting services

• SENSIO® Hi-Fi 3D: the worldwide leading 3D proprietary format

• Based in Montreal, Canada

• 27 employees in Montreal office

• Publicly-traded company on TSX Venture (SIO.V)(SIO.V); year-end May 31

First release of 3D DVDs of movies from Hollywood studios - Spy Kids 3D, first title (2005)

First demonstration of multi output playback from a single source (2004)

First full-resolution consumer 3D product anaglyph, page flip and 2D (2003)

2

DISTRIBUTIONREGULAR TV OR 3D READY

DISPLAY

3D CONTENT CREATION PLAYBACK

ENABLING TECHNOLOGIES

Award-winning SENSIO® HI-FI 3D Technology

SENSIO® 3D Encoder SENSIO® Hi-Fi 3D

SENSIO® 3DDecoder SENSIO® Hi-Fi 3D

5/16/2011

3


DISPLAY




SENSIO® 3D Encoder SENSIO® Hi-Fi 3D

SENSIO® 3DDecoder SENSIO® Hi-Fi 3D

SENSIO® S2D Switch2D or 3D selection

and formatting

5/16/2011

4


DISPLAY




SENSIO® 3D Encoder SENSIO® Hi-Fi 3D SbS TaB

SENSIO® 3DDecoder SENSIO® Hi-Fi 3D SbS TaB Noise reduction


and formatting

5/16/2011

5


DISPLAY




SENSIO® 3D Encoder SENSIO® Hi-Fi 3D SbS TaB

SENSIO® 3DDecoder SENSIO® Hi-Fi 3D SbS TaB Noise reduction


and formatting

SENSIO®

Autodetect

5/16/2011

6

5/16/2011

DIVERSIFIED MARKETS

PROFESSIONAL & BROADCASTING

LIVE 3D IN CINEMAS

CONSUMER ELECTRONICS

SENSIO POWERS…

7

LIVE 3DIN CINEMAS

5/16/2011

A FAST-GROWING MARKET LIVE 3D IN CINEMAS

Evolution of 2D and 3D digital screens worldwideVolume (Ku)

Evolution of 2D and 3D digital screens worldwideVolume (Ku)

Source : ScreenDigest et RealD

The “Avatar Effect” - December 2009

20% 29%Penetration 3D screens/ Digital screens 61%61%61%55%

+26 pts

5156

6257 7346

14306

21645

27065

1299 2543 8989

21936

33855

42395

0

5 000

10 000

15 000

20 000

25 000

30 000

35 000

40 000

45 000

2007 2008 2009 2010 2011 2012

Unit sales (K

)

2D Screens 3D Screens

9

5/16/2011

GROWING OUR EXPERTISE

TECHNOLOGY PROVIDER

2009 BCS BOWL

DISTRIBUTION FACILITATOR

2010 FIFA WORLD CUP™

EVENT PROMOTER

2011 NBA

LIVE 3D IN CINEMAS

10

5/16/2011

QUALITY LEADING THE WAY LIVE 3D IN CINEMAS

LINE OF BUSINESS

MARKET POSITIONING BUSINESS MODEL

TECHNOLOGY PROVIDER

SENSIO® Hi-Fi 3D is the dominant format for the distribution of live 3D events in theatres worldwide:• Over 800 screens installed• More than 50 events

presented on 5 continents

IP licensing – 2 models• Fixed amount payable as

one-time or per-event• Ongoing – as a fixed

amount per ticket sold

LIVE 3D CONTENT DISTRIBUTION

SENSIO’s aim: to be a leading supplier of quality live 3D content to theatres part of its worldwide network

Box office share

11

UNIQUE, READY-TO-GO, EVER-EXPANDING, WORLDWIDE

The SENSIO® 3D Live Network:839 cinemas

Over 50 events

12 LIVE 3D IN CINEMAS

5/16/2011

2011 OUTLOOK LIVE 3D IN CINEMAS

• CONTINUE TO EXPAND OUR SENSIO® 3D LIVE NETWORK– EXPANSION IN ASIA – MAIN FOCUS IN 2011

– NEW OPPORTUNITIES IN USA

• MORE SPORTS, CONCERTS AND ENTERTAINMENT EVENTS DRIVEN BY SENSIO

“ WE ARE EXPECTING STEADY GROWTH IN THE COMING YEAR"

13

CONSUMER ELECTRONIC

MARKET

0 1 3,1 18,8 36,4 67,9 102

205 215 226 235 243 251 261

0

50

100

150

200

250

300

2008 2009 2010 2011 2012 2013 2014

Other TVsshipped3DTVsshipped

5/16/2011

3D MOVING INTO THELIVING ROOM

Evolution 3DTVs worldwideVolume (Mu)

Evolution 3DTVs worldwideVolume (Mu)

0% 0.5%Penetration3DTVs / Total TVs

27%15%8%1.4% 39%


Total TVs shipped

15

5/16/2011

QUALITY LEADING THE WAY

LINE OF BUSINESS MARKET POSITIONING BUSINESS MODEL

TECHNOLOGY PROVIDER– CE MANUFACTURERS AND CHIP MAKERS

SENSIO® Hi-Fi 3D is the leading non-open-source format in the CE market.

SENSIO’s aim: to be the leading provider of stereoscopic (3D) image-processing cores in the industry

IP licensing oftechnology cores based on volume and packaged pricing

CONTENT AGGREGATOR

SENSIO’s aim: to be a leading supplier of quality 3D content to VOD distributors

VOD rental revenueshare


16

5/16/2011

PERMEATING THE ECOSYSTEMCONSUMER ELECTRONICS

• SENSIO® HI-FI 3D• SENSIO ® S2D SWITCH• SENSIO® AUTODETECT

SENSIO PRODUCTS

S/W MEDIA PLAYERS

17

5/16/2011


GAMES

VODPPV

3D TITLES

SENSIO® 3D Content Library

SENSIO PRODUCTS

SENSIO® Hi-Fi 3D technology for console games

SENSIO PRODUCTS


SENSIO PRODUCTS

S/W MEDIA PLAYERS

18

5/16/2011


GAMES

VODPPV

3D TITLES

SENSIO® 3D Content Library

SENSIO PRODUCTS

SENSIO® Hi-Fi 3D technology for console games

SENSIO PRODUCTS

TIER-ONE

CHIP MANUFACTURERS

TIER-ONE

SENSIO PRODUCTS

• SENSIO® Hi-Fi 3D• SENSIO® Autodetect• Image enhancement

- scaling- noise reduction- de-interlacer


SENSIO PRODUCTS

S/W MEDIA PLAYERS

19

5/16/2011

2011 OUTLOOK CONSUMER ELECTRONICS

• CE MANUFACTURERS – EXPANSION DRIVEN BY DIFFERENTIATION– SENSIO ® Hi-Fi 3D – the high-fidelity format – will make significant inroads

• VIZIO effect

• Appeal of SENSIO ® 3D Content Library (VOD)

• SEMICONDUCTORS– Leverage success of SENSIO® Hi-Fi 3D to generate sales with SENSIO ® Autodetect

• SENSIO® S2D SWITCH– Negotiations are going well – snowball effect

20

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

TECHNOLOGY

CONTENT - VOD

TECHNOLOGY

DEVELOPMENT SALES AND REVENUES (PRODUCTS ON THE MARKET)

LINES OF BUSINESS 2008 2009 2010 2011

CONTENT - LIVE 3D DISTRIBUTION

RESEARCH

2012

TIMELINE



TECHNOLOGY - CE MANUFACTURERS

TECHNOLOGY - CHIP MAKERS

LIVE 3D IN CINEMAS

MARKETS

5/16/2011

COMING TO FRUITION21


TECHNOLOGY

CONTENT - VOD

TECHNOLOGY




RESEARCH

2012

TIMELINE





LIVE 3D IN CINEMAS

MARKETS

5/16/2011


MARKET DRIVERS: WHAT TO LOOK FOR

2011-05-16

24

• BLA

• BLA

FINANCIALS

5/16/2011

MONETIZING THE OPPORTUNITIES

LIVE 3D IN CINEMAS

• Average acquisition cost of SENSIO technology at maturity: $2,000

• Worldwide potential market as of December 2010:22,000 screens x $2,000 = $44 million

• Worldwide potential market at maturity :150,000 screens x $2,000 = $300 million

FYE FYE 9 months

2009 2010 2011

Revenue – Technology (000’s) 427 641 1,000

Percentage growth n/a 50.1% 56%

25

SENSIO® 3D screensY1 = 2008

RealD 3D screensY1 = 2005

TOTAL WORLDWIDE 3D SCREENS: 21.9K (CYE 2010)

Growth assumption (based on RealD historical growth figures):

82 241718

105

6741100

2108

5321

0

2000

4000

6000

Y1 Y2 Y3 Y4 Y5

X 10,5

X 8,7

?

?

?

?

LIVE 3D IN CINEMAS


• FYE 2012: 800 new screens = 1500 network• FYE 2013: 2500 new screens = 4000 network

26

5/16/2011



• Price between $0.25 to $2.50

• Average price / product = $0.50

2011 2012 2013 2014

Assuming Vizio share of 3DTVs similar to 2DTVs in North America USA, Canada, Mexico (20%)

1.06M 1.86M 3.23M 4.86

27

5/16/2011

OTHER REVENUE SOURCES FOR FYE 2012

• SENSIO® S2D Switch (patent licence)

• SENSIO® Autodetect to chip makers

• SENSIO® Content Library (via VOD)

• Live 3D content

• Professional and broadcast market

28

5/16/2011

LONG-TERM POTENTIAL MARKET

MARKETS WW 2D MARKET 2010

PENETRATION RATE AT

MATURITY

AVERAGE PRICE / UNIT

$ POTENTIAL

TV sets 226 M ? $0.50 ?

PC & laptops 333 M ? $0.50 ?

STB 148 M ? $0.50 ?

Mobile 281 M ? $0.50 ?

Total 988 M ? $0.50 ?


You do the math!

29

5/16/2011

COMPARABLES

GLOBAL IP LICENSING COMPS Trdg Curr

Local Price Pot. Mkt. Cap. Revenue (USD) P/E EV/Sales EV/EBITDATicker Rtg 09-mai Target Return (US$M) C11E C12E C11E C12E C11E C12E C11E C12E

D-BOX Technologies Inc. TSX:DBO SO CAD 0,56 1 79% 95 9 20 NM NM 8,4 3,9 NM 25,7SENSIO Technologies, Inc. TSXV:SIO SO CAD 0,81 3 270% 42 3 8 NM 52,3 11,9 4,2 NM 32,7Wi-LAN Inc. TSX:WIN SO CAD 5,93 11 85% 718 111 146 9,6 6,7 4,9 3,7 7,5 5,1QUALCOMM Incorporated QCOM NR USD 56,66 64,67 14% 94 596 14 990 16 671 18 16 5,5 5 12,2 11Dolby Laboratories, Inc. DLB NR USD 49,78 60,04 21% 5 578 936 1 053 18,6 15,9 5,2 4,6 10 9,1Rovi Corporation ROVI NR USD 49,42 67,27 36% 5 566 780 926 20,8 16,5 7,2 6 16 13InterDigital, Inc. IDCC NR USD 46,02 51 11% 2 087 366 403 17,5 15,4 4,3 3,9 6,3 5,5RealD Inc. RLD NR USD 31,03 29,5 -5% 1 592 359 406 NM 35,8 4,3 3,8 16,7 11,2Tessera Technologies Inc. TSRA NR USD 18,98 28 48% 970 303 346 14 11,3 1,6 1,4 5,3 4,1Acacia Research Corporation ACTG NR USD 39,82 45 13% 1 703 182 227 32,9 22,5 7,7 6,1 19 13,8DTS Inc. DTSI NR USD 44,24 48,69 10% 769 104 126 32,9 24,2 6,5 5,4 16,2 11,8MIPS Technologies Inc. MIPS NR USD 8,23 12 46% 427 84 96 22,2 15,8 3,9 3,4 13,1 9,7MOSAID Technologies Inc. TSX:MSD NR CAD 28,75 35,5 23% 353 89 124 10,3 7 2,6 1,9 4,7 NM SRS Labs Inc. SRSL NR USD 8,26 11,17 35% 123 37 44 27,1 14,5 2,5 2,1 NM NM 01 Communique Laboratory Inc. TSX:ONE NR CAD 0,4 0,75 88% 25 1 12 NM NM NM 1,6 NM 2DEQ Systems Corporation TSXV:DEQ NR CAD 0,39 NA NA 28 NA NA NM NM NM NM NM NM

Mean 21,4x 17,7x 4,7x 3,8x 11,9x 9,1x

Median 19,7x 15,9x 4,3x 3,9x 12,6x 10,3x

SOURCE: NCP, Capital IQ (SIO-V, DBO.A-V, and WIN-T are NCP estimates; DBO.A-V is covered by Rob Goff; SIO-V, WIN-T are covered by Ralph Garcea)

30

5/16/2011

CAPITAL STRUCTURE

1 - As of market close on May 13, 2011 2 - As at February 28, 2011

SHARE PRICE1 $1,08

52.4M

$0.76

2M

54.3MFD SHARES

FD MARKET CAP

$41.3M

52 WEEK HIGH

52 WEEK LOW

$2.15

$0.72

CASH2

DEBT

$7.2M

$0

BASIC SHARES

OPTIONS & WARRANTS

SHAREHOLDER STRUCTURE:• Board and management 20%• Institutional 30%• Free Float 50%

31

MARKET DRIVERS: WHAT TO LOOK FOR

2011-05-16

32

• BLA

• BLA

QUESTION PERIOD

SENSIO Technologies Corporate Presentation May 2011

Technology

Transcript of SENSIO Technologies Corporate Presentation May 2011