ATOMOS LIMITED — Investor Presentation 2019

Aug 28, 2019

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FY19 Results Presentation

Atomosunlockscreativityandprofitforvideocontentcreators Advanced technology allows faster, higher quality, more flexible productions

29 August 2019

Agenda

About Atomos FY19 in Summary Financial Results Operational Update Growth Initiatives Appendices Presenting: Jeromy Young Managing Director & CEO James Cody CFO

3 6 9 15 20 23

“Our vision is to invent and deliver ground breaking and disruptive technologies that enhance, simplify and ultimately democratise video content creation”

Content Creation Workflow

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CAPTURE PROCESS &ENHANCE
From the sensor of Atomos products enhance contentcreation, quality and
all major cameramanufacturers creativity
Atomos’ devices are compatible
with all levels of contentcreation
& equipment
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FINISH &DELIVERY
Edit, Colour Grade, Titles, Graphics
Finish in Post
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© Atomos 2019 | FY19 Results Presentation 4

Target Markets – Current & Future

Atomos’ growing product portfolio will address a US$10B camera equipment market[1]

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Content
Social ProVideo Entertainment
Creation
Camera Equipment
Phone & PhotoCameras Pro Video Cameras Broadcast, TV & Cinema
SHINOBI
NINJA
Atomos
Products SHOGUN
SUMO
NEON
23% CAGR 18% CAGR 35% CAGR
NEWMARKETS NEWMARKETS
Social Entertainment
Future Markets
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Expansion into growing Social & Entertainment video content markets

© Atomos 2019 | FY19 Results Presentation 5

1 CIPA Report, 2017

Agenda

About Atomos 3 FY19 in Summary 6 Financial Results 9 Operational Update 15 Growth Initiatives 20 Appendices 23

FY19 Financial Summary* (Full year ending, 30 June 2019)

	•	Revenue up 51% year on year to $54.0m
Sales	•	Exceeded FY19 Prospectus revenue forecast of $42.2m by 28%
	•	Driven by strong sales of new products Ninja V and Shinobi, coupled with existing flagship product Shogun Inferno
	•	Gross profit up 39% to $24.0m year on year and above Prospectus forecast by 21%
Gross Profit / Expenses	•	Gross profit margin of 45%, 2H19 improved over 1H19 driven in part by improved component costs for Ninja V as flagged at the interim results
	•	Invested in marketing to support Atomos’ entry into the emerging Social segment in FY19 and to support further growth
Earnings	• •	EBITDA up $1.4m year on year to $1.6m Exceeded FY19 Prospectus EBITDA forecast of $0.3m by $1.3m
	•	Strong cash position of $5.1m at year end. Raised a further $7.5m (before costs) via placement in July 2019
Cash Flow	•	Continued disciplined working capital management as sales growth accelerated – inventory levels reduced versus 1H19
	•	Capex of $3.1m in line with Prospectus

• All numbers are Pro forma and exclude items outside the ordinary course of business, a full reconciliation is contained in slide 14. All figures are based on the consolidated financial statements that are in the process of final auditor review.

© Atomos 2019 | FY19 Results Presentation 7

FY19 Operational Summary

	•	Completed development of Ninja Platform, the core technology platform underpinning current product range
	•	Ninja V (5” monitor recorder) released in September 2018, first product powered by Ninja platform
New Products	•	Released two versions of Shinobi (5” monitor), catering to different users
	•	Shogun 7 (7” monitor recorder) – upgrading current Shogun Inferno
	•	Neon series of HDR Cinema monitors - four sizes announced in June 2019 and shipping late Q1 FY20
	•	Strengthened partnership with Nikon allowing RAW video output over HDMI and Apple ProRes RAW video capture
Partnerships	•	Finalised license agreement with RED.com LLC
	•	Announced license agreement with Dolby Vision
	•	94.8 million shares released from 6-month escrow on 28 June 2019
Corporate	•	Successfully raised $7.5m (before costs) via Institutional Placement
	•	Concurrent with the Institutional Placement, 27 million shares (of the 94.8m released from escrow) were placed with institutional investors

© Atomos 2019 | FY19 Results Presentation 8

Agenda

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|||
|---|---|
|About Atomos|3|
|FY19 in Summary|6|
|Financial Results|9|
|Operational Update|15|
|Growth Initiatives|20|
|Appendices|23|

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Pro Forma Income Statement*

	Income Statement - Pro F orma ( A$m) F Y18 Revenue 35.6 COGS (18.3) Gross Profit 17.3 Gross profit margin % 48.5% Other Income 0.3 Distribution expenses (1.2) Wages & Salaries (6.5) Marketing (2.3) General & Administration (3.6) Op erating Exp enses ( 13.3) EBITDA( p re R&D) 4 .0 R&D Expenses (3.8) EBITDA 0 .2 Depreciation & Amortisation (0.3) EBIT ( 0 .1)	F Y19 54.0 (29.9) 24 .0 44.6% (0.0) (1.6) (7.7) (5.6) (3.4) ( 18.3) 5.8 (4.1) 1.6 (1.5) 0 .2	V ariance 51% (63%) 39% (108%) (29%) (19%) (141%) 7% ( 37%) 4 5% (10%) 64 2% (428%) 4 13%	F Y19 Prosp ectus 42.2 (22.4) 19.9 47.1% 0.2 (1.6) (7.6) (3.3) (3.2) ( 15.5) 4 .4 (4.1) 0 .3 (1.2) ( 1.0)

Key Insights:

• Revenue up 51% year on year to $54.0m

• Exceeded FY19 pro forma Prospectus revenue forecast by 28%

• Gross profit up 39% year on year and $4.1m ahead of Prospectus forecast

• Gross profit margin lower than Prospectus forecast due to higher than anticipated initial component costs for Ninja V in 1H19

• Gross profit margin improved in 2H19 compared to 1H19

• Invested in marketing to support Atomos’ entry into the emerging Social segment in FY19 and to support further growth

• Pro forma EBITDA of $1.6m, up $1.4m on prior year and ahead of Prospectus forecast of $0.3m

• D&A increased on FY18 reflecting the initial commercialisation of the Ninja platform during FY19

• The Company anticipates continued momentum which will be reflected through solid growth in sales and earnings and continued investment in market development

• All numbers are Pro forma and exclude items outside the ordinary course of business, a full reconciliation is contained in slide 14. All figures are based on the consolidated financial statements that are in the process of final auditor review.

© Atomos 2019 | FY19 Results Presentation 10

Atomos – A financial snapshot

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Pro Forma Revenue ($m) [1]
$60.0m 54.0
$50.0m
35.6 29.7
$40.0m
31.1 2H
30.5
27.5
$30.0m 17.3
16.7 2H
$20.0m 2H
24.2
$10.0m 14.4 18.… 1H
1H
$0.0m
FY15 FY16 FY17 FY18 FY19
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Pro Forma EBITDA ($m) [1]
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$6.0m 5.7
$4.0m
1.6
$2.0m
0.2
$0.0m
FY15 FY16 FY17 FY18 FY19
($2.0m)
($4.0m)
(4.6) (4.5)
($6.0m)
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Revenue by Market Segment (FY18 vs. FY19)
FY18 FY19
Social $4.3m
$3.5m
$8.3m
Pro Video
Entertainment
$30.9m
$41.0m
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FY19 Revenue by Region
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Asia
21%
US
50%
EMEA
28%
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• 1 FY15, 1H17, 2H17, 1H18 & 2H18 Unaudited

© Atomos 2019 | FY19 Results Presentation 11

Pro Forma Balance Sheet

Pro F orma ( A$m) H119 F Y19 Cash and cash equivalents 5.2 5.1 Trade and other receivables 6.1 8.0 Inventories 11.1 7.9 Other assets 2.6 3.0 Plant and equipment 0.9 1.7 Intangible assets 8.2 8.5 Total assets 34 .1 34 .2 Trade and other payables (10.9) (8.8) Current provisions (0.6) (0.6) Borrowings 0.0 (1.5) Non-currentprovisions 0.0 (0.0) Total liab ilities ( 11.5) ( 11.0) Net assets 22.6 23.2 Issued capital 44.3 44.1 Reserves 1.9 2.2 Accumulated losses (23.6) (23.0) Eq uity 22.6 23.2

Key Insights:

• Strong balance sheet with $5.1m cash as at 30 June 2019

• Raised additional $7.5m (before costs) in July 2019 via Placement

• Inventory levels reduced versus 1H19 as a result of:

• Sell-through of components and finished goods that had been built-up ahead of Chinese New Year

• Disciplined inventory management

• Trade and other payables also reduced by ~$2.1m compared to 1H19 reflecting sale of built up stock pre Chinese New year

• Utilised $1.5m EFIC working capital facility during 2H19 as sales increased above Prospectus forecast

• $17.6m of tax losses and R&D tax credits available to offset future tax payable (off balance sheet)

• All numbers are Pro forma and exclude items outside the ordinary course of business, a full reconciliation is contained in slide 14. All figures are based on the consolidated financial statements that are in the process of final auditor review.

© Atomos 2019 | FY19 Results Presentation 12

Statutory Cash Flows

Statement of Cash F lows ( A$m) F Y19 F Y18 Op erating activities Receipts from customers 52.9 34.9 Payments to suppliers and employees (57.0) (37.8) Interest received 0.0 0.0 Income taxespaid - - Net cash used in op erating activities ( 4 .1) ( 2.9) Investing activities Payments for property, plant and equipment (1.3) (0.7) Payments for intangible assets (1.8) (3.6) Net cash used in investing activities ( 3.1) ( 4 .4 ) F inancing activities Proceeds from issue of equity instruments in the Company 6.0 7.0 Proceeds from issue of convertible notes 7.0 1.1 Interest paid (0.1) (0.4) Payment for equity raise costs (1.5) (0.4) Proceeds from borrowings 1.5 - Repayments of borrowings (2.0) (0.1) Net cash inflow from financing activities 10 .9 7.2 Net chang e in cash and cash eq uivalents 3.7 ( 0 .1) Cash and cash equivalents, beginning of year 1.4 1.5 Exchange differences on cash and cash equivalents - (0.0) Cash and cash eq uivalents, end of year 5.1 1.4

Key Insights:

• Operating cash outflow reflects growth in working capital driven by successful product launches of Ninja V, Shinobi and Shogun 7:

• Higher inventory to satisfy demand, coupled with;

• Growing debtor balance from strong sales

• Negative cash conversion (operating cash flow: EBITDA) reflects build in working capital, particularly debtors ($3.2m) from stronger sales and inventory investment ($1.9m) to support the growth

• Capex (net cash used in investing activities) relates to payments to external parties for new product/technology projects

© Atomos 2019 | FY19 Results Presentation 13

Income Statement Reconciliation – Statutory to Pro forma

$’0 0 0 20 19 Rep orted Items not in the ord inary course of Und erlying Result Revenue 55,681 (1,720) 53,961 Cost of sales (29,782)  (130) (29,912) Gross p rofit 25,899 ( 1,850 ) 24 ,0 4 9 Gross profit margin % 47.0 % 45.0 % Operating Expenses – ongoing (22,404) (22,404) Operating Expenses – one-off (1,715)  1,715 0 EBITDA 1,780 ( 135) 1,64 5 Depreciation and amortisation (1,469) 0 (1,469) Finance costs (1,443)  1,442 (1) Loss b efore income tax ( 1,132) 1,30 7 175 Income tax(expense)/ benefit (827) 0 (827) Loss for theyear ( 1,959) 1,30 7 ( 652)

Items not in the ord inary course of b usiness ( 20 19) $’0 0 0 Revenue Sales to suppliers: supplierpass through sales at no margin (1,720) Revenue ( 1,720 ) Cost of sales Sales to suppliers: supplier pass through sales at no margin 1,720 One off Inventory write-off/ clearance 1,277 Resolution of European Customs dutydispute (3,127) Cost of sales ( 130 ) Op erating Exp enses Revaluation of embedded derivative and other financial instrum (1,018) IPO & other transaction costs 2,033 Accelerated vesting of pre IPO share options 535 Costs associated with resolvingEuropean customs dispute 165 Op erating Exp enses 1,715 Interest on convertible notes 1,442 Total Items not in the ord inary course of b usiness 1,30 7

© Atomos 2019 | FY19 Results Presentation 14

Agenda

About Atomos FY19 in Summary Financial Results Operational Update Growth Initiatives Appendices

3 6 9 15 20 23

Products – Social & Pro Video

• Completed development of Ninja Platform - core technology platform underpinning current product range

• Ninja V (5” monitor recorder) - first product powered by Ninja platform launched in September 2018

• Caters to both Social and Pro Video customers, enabling improved quality video productions at minimal cost

• AtomX modules allow for ongoing feature enhancement

• Released 2 versions of Shinobi (5” monitor only), each catering to different video users in the Social market

• Shogun 7 (7” monitor recorder) – upgrading current Shogun Inferno

• Flagship product continuing to build on competitive position in Pro Video market

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© Atomos 2019 | FY19 Results Presentation 16

Products - Entertainment (Neon Cinema Series)

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• Announced Neon series of HDR Cinema monitors

• Designed for on-set and in-studio

• Film & Episodic TV

• Live on-set TV

• Live Event Production

• Indie Filmmaking

• Four sizes – 17”, 24”, 31” and 55”

• High quality 4Kp60 / HDp240 Apple ProRes Raw recording

• Bluetooth controlled by Atomos iOS App

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© Atomos 2019 | FY19 Results Presentation

17

Products – Neon Cinema Series Product Workflow

• The overarching purpose of our products is to enhance the workflow of video professionals

• We believe the Neon series achieves this across multiple roles both on-set and in-studio

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© Atomos 2019 | FY19 Results Presentation 18

Partnerships – Continuing to build a global ecosystem of partners

• Further strengthened partnership with Nikon allowing RAW video output and Apple ProRes RAW video capture

• Established license agreement with Dolby Vision

• 1[st] globally with access to Dolby algorithm for incorporating into recording and playback device

• Atomos users can see at point of capture what viewer will see at home

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• Finalised license agreement with RED.com LLC

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© Atomos 2019 | FY19 Results Presentation 19

Agenda

About Atomos FY19 in Summary Financial Results Operational Update Growth Initiatives Appendices

3 6 9 15 20 23

Growth Pathways

Growth Drivers

Description

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Promoting Existing Products • Continue to drive sales of current product portfolio building upon momentum in FY19 whilst driving • Leverage technology portfolio to develop products consistent with roll-out strategy New Product Development Continue Expansion into Social • Build on strong base in Pro Video and Entertainment Markets • Expand further into adjacent high growth market segments of Social & Entertainment • Continue to strengthen relationships and partnerships with global camera makers and Evolve Strategic Relationships software video editing providers Continue to Seek exceptional • Seek out exceptional talent globally to enable continued development of leading content Management & Talent creation products

© Atomos 2019 | FY19 Results Presentation

21

Outlook for FY20

• Atomos is well placed to capitalise on existing market positions through:

• continued growth in traditional Pro Video segment;

• building on initial base in Social; and

• penetration and growth of presence in Entertainment

• This will be reflected through continued:

• solid growth in sales and earnings

• deployment of new products

• investment in market development

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© Atomos 2019 | FY19 Results Presentation 22

Agenda

About Atomos FY19 in Summary Financial Results Operational Update Growth Initiatives Appendices

3 6 9 15 20 23

Global Operations

Officesinmajorgloballocationsandstrongsaleschannels

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FY19 Sales
byRegion
•
95StaffGlobally
PORTLAND LONDON PARIS
FRANKFURT
NEWYORK
Asia 21%
• 10 Offices in 7 Countries LOSANGELES TOKYO
BEIJING
US
SHENZHEN US 50%
53%
• EMEA
Strong Global SalesChannel
28%
• Broadretailer and resellernetwork in
eachregion
MELBOURNE
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© Atomos 2019 | FY19 Results Presentation 24

* As of August 2019

Growth in Atomos’ Markets

Social Content

Accessibility of new social media platform allows individuals to produce, share & monetise their content

• New Technology is allowing Everybody to create quality video content

• Growing advert driven video capable platforms allow instant mass sharing of video

• Content creators have platforms to build significant followings & monetise their content

• DanTDM (YouTube) – US$16.5m earnings in FY17

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1 Boston Consulting Group, “The Future of Television”, 20 September 2016

Pro Video Content

Market wide increase in video-focused corporate marketing, advertising, event and content creation

• US$135B[1] 2017 spend on US digital video marketing

• Advertisers and publishers now ‘pivoting to video’ for brand exposure and marketing

• ~$20k ave. estimated spend in 2017 by US businesses on video marketing[1]

• Redefined Video Marketing

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• Create great, exciting content that audiences actively seek (Stratos Jump)

• Redbull use Atomos products

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• 1 Magisto Report, Oct 2017 – The Modern Marketing Dilemma and the State of Business Video 2 Juniper Research, Future Digital Advertising AI, Ad Fraud & Ad Blocking

Entertainment Content

Increased original content by new online streaming platforms is driving demand for enhanced content

• Growth of on demand streaming has driven investment in original content

• Netflix, Amazon and Apple are expected to grow their combined spend for original content from US$5B in 2017 to >US$23B in 2022[1]

• Massive growth in production of scripted TV Shows[2]

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• 1 Loup Ventures - Research, Gene Munster, Nov 21 2017

• 2 FX Network Research – Adweek.com article “There’s No Stopping Peak TV…”

© Atomos 2019 | FY19 Results Presentation

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Atomos unlocks the creative and commercial potential of digital cameras

Despite the advanced technology of modern digital cameras, users are limited by:

• Heavily compressed recordeddata

• Not designed for computerworkflows

• Short recordtimes

• Expensivemedia

• Small lower resolutionmonitors

• Complex menus andbuttons

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Lower
quality
monitor
Complex
menus
Short
record
Expensive
times
media
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© Atomos 2019 | FY19 Results Presentation 26

Atomosdevicestakeimages directlyfromthecamera’ssensor, thenenhance, recordanddistributethemforcontentcreation

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© Atomos 2019 | FY19 Results Presentation 27

Product Suite

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4K Monitor Recorders Production / Studio Broadcast & Accessories
Shogun Studio + Converters +
NINJA + SHINOBI Range SHOGUN Range SUMO Range NEON Cinema Series
Accessories
• Ninja HDMI only – includes AtomX • HDMI & Quad SDI inputs • Larger format 19” monitor recorder • HDR cinema monitor-recorder range Shogun Studio
adaptor range • Broad market application due – targeting studio usage for on-set and in-studio usage • Rack mount 4K monitor recorder
• Broad market application due to to portability • Quad SDI & HDMI in/out • Capable of 8K ProRes RAW recording solution
•• portabilityBoth 5” and 7” screen options Record ProRes®, DNxHR at 60p •• 7” high brightness screenRecord ProRes, DNxHR at 60p frame rates • Record ProRes/ProRes RAW, DNxHR, among others • by upgrading with Neon 8K Master Control UnitFour screen size options – 17”, 24”, • Converters Dual 7” screens with touchscreen interface
31” and 55”
• frame ratesAtomHDR monitoring •• ProRes RAW capabilityAtomHDR monitoring • Bluetooth controlled by using either Atomos iOS App or a physical •• Range of 4K convertersSDI to HDMI or vice versa
• Includes recently released 5” remote control
Accessories
Shinobi monitor only
• Shinobi available in both HDMI & SDI • Cables, Caddies & Adaptors
capability
Social / Pro-Video Segment Pro-Video / Entertainment Pro-Video / Entertainment Entertainment Various
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© Atomos 2019 | FY19 Results Presentation 28

Key Terms Explained

“ 4k60p ”

Refers to: Resolution / Frame Rates

• Resolution refers to the number of pixels displayed within each frame - simplistically, greater pixels (higher resolution) results in a sharper, clearer and more detailed image (video)

Standard Resolution (W x H)	Standard Resolution (W x H)
Standard Definition (SD)	720 x 480
Full High Definition (HD)	1920 x 1080
4K (UHD)	3840 x 2160
8K	7680 x 4320

• 4K contains 8 million pixels compared to 2 million pixels for Full HD

• The ‘p’ stands for progressive scanning and is increasingly become the standard over ‘i’ (or interlaced) which was popular in the early TV era

• Frame Rates refers to the frequency (no. of frames) that an image is recorded per second - the higher the frame rate the smoother the video appears

• There is a often a trade off between resolution & frame rate depending on application, setting, budget and editing software

Frame rates p/s (fps) Usage	Frame rates p/s (fps) Usage
24 / 30	Standard for home movies
60	Suited for faster paced video, e.g. sports
240	Slow motion video

“ ProRes recording”

Refers to: Recording Format

• Recording Format or “Codec” refers to how a video is captured & recorded by the camera or recording device

• The codec (abbreviation for Coder/Decoder) describes the type of compression used to record a video - the codec encodes a video stream thereby making the video file smaller & easier to manage/transport to editing software

• The editing software (assuming the codec is supported) is then able to decode (unpack) the video file based on the rules set by that codec, providing the user access to all the video information during post production (editing)

• For professionals some of the main codec’s include:

• ProRes or ProRes RAW  Apple

• DNxHR  Avid

• CinemaDNG  Adobe

• For simplicity, we are only referring to codec’s typically used by video professionals – that is users who require video to be edited via an editing suite in post production

• For ‘amateur’ video requiring only minimal editing with the aim of uploading to a video streaming site other codec’s may be more applicable (e.g. H.264)

• RAW refers to uncompressed video footage taken directly from a camera's sensor. Although it provides the highest level of colour and image detail, it requires huge data capability and therefore is impractical for most users

“ 1,500 Nits brightness & HDR”

Refers to: Screen Brightness (Nits) / HDR

• Nits refers to a measurement of light that a screen sends to your eyes (luminance) within a given area – the greater Nits the more light output the screen can display

• Tabled below are few examples for comparison:

Device Nits	Device Nits
iPhone X	625
Galaxy Note 8	1,200
Shogun Inferno	1,500
Samsung QLED Q9F TV	Up to 1,800

• HDR (High Dynamic Range) refers to the brightness range of an image and aims to present a similar range of colour and brightness to that experienced by the human eye

• In HDR video each pixel can capture a much wider and more granular range of light (whites appear whiter and darks appear darker)

• Atomos invented the ability to view (on an in-field monitor) what HDR video will look like once it has been through post-production

• Prior to Atomos, the only way to ‘approximate’ HDR while shooting in the field was to apply a LUT (colour style filter) to the video image

© Atomos 2019 | FY19 Results Presentation 29

Growing the Atomos Ecosystem…

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© Atomos 2019 | FY19 Results Presentation

30

Contacts

For further information on this presentation, please contact:

James Cody Matthew Wright Chief Financial Officer Media relations +61 3 9999 5908 +61 451 896 420 james@atomos.com matt@nwrcommunications.com.au

About Atomos

Atomos is a global video technology company delivering award-winning, simple to use monitorrecorder content creation products. These products give content creators across the rapidly growing social, pro-video and entertainment markets a faster, higher quality and more affordable production system.

Key upcoming Tradeshows / Conferences:

Name	Location	2019 Dates
IBC	Amsterdam	13 - 17 September
PHOTOPLUS	New York	24 – 26 October
Inter BEE	Tokyo	13 - 15 November
CES 2020	Las Vegas	7 - 10 January 2020
CABSAT 2020	Dubai	31 March – 2 April

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Key Tradeshow
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Atomos’ range of products take images directly from the sensor of all major camera manufacturers, then enhance, record and distribute them in high-quality formats for content creation using the major video editing software programs. Since being founded in 2010, Atomos has established strategic relationships with key technology providers within the ecosystem including Apple, Adobe, Sony, Canon, Panasonic, Nikon and JVC Kenwood.

Atomos is based in Australia with offices in the USA, Japan, China, UK, France and Germany and has a worldwide distribution partner network.

For more information please visit www.atomos.com

© Atomos 2019 | FY19 Results Presentation 31

Disclaimer

The information contained in this document (“Document”) has been prepared by Atomos Limited ACN 139 730 500 (referred to as “Atomos” or “Company”). This Document is current as at the date of this Document and should be read in conjunction with other Atomos periodic and continuous disclosure announcements filed with the Australian Securities Exchange (ASX), available at www.asx.com.au.

The information in this Document is not intended to form the basis of any investment decision in relation to the Company or its assets and should not be considered as a recommendation to the Recipient to acquire securities in the Company. This Document is not a prospectus, profile statement or disclosure document and does not constitute an offer or invitation to acquire securities or otherwise invest in the Company, and no agreement to subscribe for securities will be entered into on the basis of this Document.

No representation or warranty, expressed or implied, is or will be made, and no responsibility or liability is or will be accepted by the Company, any of their respective officers, servants, agents or advisers (collectively “Limited Parties”) as to or in relation to the accuracy, reasonableness, completeness or reliability of the information in this Document or any other written or oral information made available to any Recipients or their advisers. Any liability therefore is hereby expressly disclaimed. In particular, no representation or warranty is given as to the achievability or reasonableness of any future projections, management estimates or plans, prospects, returns or forecasts.

To the fullest extent permitted by law, the Limited Parties will not have any responsibility or liability for any loss or damage (whether foreseeable or not), however arising (including as a result of negligence), in relation to or in connection with the provision of this Document, the Recipient’s or any other person’s purported reliance on this Document, the failure to provide information of which any of the Limited Parties becomes aware or any errors in or omissions from this Document.

None of the Limited Parties makes or gives any representation, warranty or guarantee, express or implied, that the information in this Document is accurate, current, reliable or complete, has been or will be audited or independently verified, or that reasonable care has been taken in compiling, preparing or furnishing it. Various statements in this Document constitute statements relating to intentions, future acts and events including forecast financial information (“Forward Looking Statements”). Forward Looking Statements involve subjective judgment and analysis, known and unknown risks, uncertainties and other important factors that may cause those future acts, events and circumstances to differ from the way or manner in which they are expressly or impliedly portrayed herein. The Limited Parties do not make or give any representation, warranty or guarantee, express or implied, that any Forward Looking Statements will be achieved or proven correct, or that any assumptions or projections on which the Forward Looking Statements are based are reasonable. No historical financial information, forecast financial information, estimates or projections contained in this Document or any other financial information derived from that information, can be relied upon as a promise or representation, as to the past, present or the future. Past performance is not necessarily a guide to future likelihood of achievement or reasonableness of any Forward Looking Statement, forecast financial information or other forecast.

The Limited Parties do not undertake any obligation to (and expressly disclaim any obligation to) provide the Recipients with access to any additional information or to correct any inaccuracies herein which may become apparent or to disseminate any updates or revisions to any Forward Looking Statements in this Document to reflect any change in expectations in relation to any such statements or any change in events, conditions or circumstances on which any such statement is based.

This document also contains statistics, data and other information relating to markets, market sizes, market shares, market positions and other industry data pertaining to the Company's business and markets. Such information is generally based on independent market and industry data or research. The Company has not independently verified, and cannot give any assurances as to the accuracy and completeness of the information sourced from market and industry data or research contained herein. Accordingly, the accuracy and completeness of such information is not guaranteed. There is no assurance that any of the forecasts or projections contained in the independent market and industry data or research will be achieved. Forecasts and projections involve risks and uncertainties and are subject to change based on various factors. You should note that market data and statistics are inherently predictive and subject to uncertainty and not necessarily reflective of actual market conditions.

Neither the receipt of this Document by any person nor any information contained in it or supplied with it or subsequently communicated to any person in connection with a proposed investment in the Company constitutes, or is to be taken as constituting, the giving of investment or financial product advice (or any other advice) to any such person. Each such person should make their own independent assessment of the merits or otherwise of investing in the Company and should seek their own professional advice in respect of any future investment opportunity and not act on the basis of any matter contained in this Document. In providing this Document, the Company has not considered the objectives, financial position, taxation situation or other needs of any particular Recipient.

The distribution of this document in jurisdictions outside Australia may be restricted by law. Persons who come into possession of this document who are not in Australia, should seek advice on and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws. In particular, this document does not constitute an offer to sell, or a solicitation of an offer to buy, any securities in the United States.

Non-IFRS financial measures

Recipients should note that certain financial data included in this Document is not recognised under the AAS, and is classified as ‘non-IFRS financial information’ under Regulatory Guide 230 ‘Disclosing non-IFRS financial information’ published by ASIC. The Company believes that this non-IFRS financial information provides useful information to users in measuring the financial performance and condition of Atomos. The non-IFRS financial measures do not have standardised meanings under AAS, and therefore may not be comparable with similarly titled measures presented by other entities, nor should these be interpreted as an alternative to other financial measures determined in accordance with AAS. Investors are cautioned not to place undue reliance on any non-IFRS financial information, ratios and metrics included in this Document.

Non-IFRS information descriptors:

• EBITDA (before R&D expenditure) is earnings before research and development expenditure, interest, taxation, depreciation, amortisation and impairment charges;

• EBITDA is earnings before interest, taxation, depreciation, amortisation and impairment charges;

• EBIT is earnings before interest, taxation and impairment charges;

• Working capital is defined by the Company as trade and other receivables, inventory and other current assets less trade and other payables and other current liabilities;

• Net cash flows from operations: the operating cash flows generated by the Company calculated as EBITDA excluding non-cash items and allowing for changes in working capital; and

• Net cash flows before financing activities: being net cash flows from operations less capital expenditure and other investing expenditure.

© Atomos 2019 | FY19 Results Presentation 32

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© Atomos 2019 | FY19 Results Presentation