DATADOT TECHNOLOGY LIMITED — Investor Presentation 2015

Mar 10, 2015

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Corporate Overview March 2015

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Company Presentation - September 2013
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DataDot Technology Limited - Disclaimer

Disclaimer:

This presentation has been prepared by DataDot Technology Limited (“DataDot”) based on information available at the time of preparation. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained within this presentation.

To the maximum extent permitted by law, neither DataDot or any member of the DataDot group, their directors, employees or agents, nor any other person accepts any liability arising from the use of this presentation or its contents or otherwise arising from fault or negligence on the part of their directors, employees or agents.

General Securities Warning:

This presentation is not an offer or invitation for subscription or purchase of or a recommendation of securities. It does not take into account investment objectives, financial situation and particular needs of the investor. Before making an investment in DataDot, the investor or prospective investor should consider whether such an investment is appropriate to their particular investment needs, objectives and financial circumstances and consult an investment advisor if necessary.

All information including business forward plans in this presentation should not be considered as a recommendation in relation to holding purchasing or selling, securities or other instruments in DataDot. Due care and attention has been used in the preparing of this information. However, actual results may vary from projected results and any variation may be material positive or negative. Forward plans, by their very nature, are subject to uncertainty and contingencies many of which are outside the control of DataDot.

Past performance is not a reliable indication of future performance.

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Index

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1.0 Overview

1.1 Corporate Data

1.2 Global Network

1.3 Core Technologies

1.4 Key Automotive Clients 1.5 Key Industrial Clients

2.0 Diversification and Growth Strategy

• 2.1 DataDot DNA

• 2.2 DataTrace DNA

• 2.3 Markets

• 3.0 Financial Performance

• 4.0 Investment Summary

• 5.0 Directors & Management

• 5.1 Directors

5.2 Senior Management Operations 6.0 Appendix

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1.1 Corporate Data

• Leading asset protection, theft deterrence, anticounterfeiting and authentication company

• Australian Stock Exchange listed in 2005 (ASX:DDT)

• Market capitalisation: $22.6 million (at 3.0₵ per share)

• Issued Capital: 752 million shares

• Available Cash: over $4 million (as at 1 March 2015)

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• Major Shareholders:

• Thorney Investments - 5.55%

• Rathie Investments - 4.06%

• Bannaby Investments - 3.99%

• Dixson Trust - 3.32%

• Colin Hwang - 3.15%

• CSIRO - 1.82%

Directors:

• Bruce Rathie (Exec. Chairman) - Gary Flowers

• Alison Coutts

August 2013 to February 2015

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1.2 Global Network

Distributors and Subsidiaries (UK & USA) in more than 20 countries, with manufacturing in five countries

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1.3 Core Technologies

DataDotDNA[®] Tiny polymer or metal discs with unique identifying codes, can be brushed or sprayed onto assets.

DataDotDNA can be read with a simple magnifying device and has the primary objective of deterring and preventing theft. The asset and its owner can be identified via a specific purpose database, accessible by law enforcement.

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0.5 to 1mm
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DataTraceDNA[®]

Forensic Tracers bond to the molecular structure of the host material, detectable in very small concentrations by a sophisticated smart reader developed by CSIRO and DataDot. The Tracers withstand explosions, fire and heat.

DataTraceDNA delivers authentication and detection management for the life of the product.

This technology was developed and patented by the CSIRO. DataDot now owns the technology and patents outright.

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1.4 Key Automotive Clients

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1.5 Key Commercial Clients

USA

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Heavy Equipment

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2.0 Diversification & Growth Strategy

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DataDotDNA DataTraceDNA
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2.1 Diversification & Growth Strategy

Regional Strategy for DataDotDNA

Australia

UK / Europe

• Push into industrial space including National Equipment Register + National Marine Register.

• Develop France as a major market given appointment of distributor.

• Add Theft Deterrent System (warranty) where appropriate.

• Promote industrial product through distributors and direct where appropriate.

• Service existing customers (eg Club Marine, HSV and Subaru).

• Build relationships with insurers and law enforcement.

• Explore deployment of DataDot Live in insurance sector.

• Pursue auto opportunities.

USA

• Aggressively market Industrial products in utility, telco, oil & gas and transport sectors based on success with Con Ed and Excel Energy. Expand reach through Grainger and other distributors

Asia / China

• Grow Auto OEM.

• Expand industrial applications.

• Deploy new and improved products.

• Develop additional distribution partners for CopDots using new smaller product design.

• Continue to expand US Auto market.

• Further expand into Canada.

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2.2 Diversification & Growth Strategy

Global Strategy for DataTraceDNA

• Build on existing client base in gaming pharmaceuticals, food and beverages, tobacco etc.

• Pursue global branded product companies in US, Europe, Asia and elsewhere.

• Grow initiatives in China in tobacco, consumer products, alcoholic beverages & auto spare parts.

• Exploit major opportunity in Australian and Asia and US defence industry.

• Continue development of reader capability to broaden target applications in uncontested market segments such as bulk materials.

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2.3 Markets

**THEFT ***

Automotive > $6.5 Billion US annually

COUNTERFEIT **

$650 Billion Global annually > $200 Billion US annually

Cargo / Transportation > $15 Billion US annually Industrial Assets (Copper, Physical assets) > $5 Billion US annually

• Sources: NICB (National Insurance Crime Bureau, DOE Copper report)

• ** Source: Havoscope, Llc., 2015

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3.0 Financial Performance

AUD$m

Year	2011	2012	2013	2014	1H FY 2015
Revenue	7.4	7.1	7.0	7.2_(*1) _	3.4
EBITDA	(0.19)	(1.21)	0.30_(*3)_	(0.84)	0.10
NPAT	(0.58)	(1.65)	(0.22) (*3)	(1.28)(*2)	(0.10)

• Substantial turnaround in profitability (EBITDA) for 1H FY 2015 based on cost reduction and efficiency gains.

• Revenue growth anticipated in 2015 due to strong pipeline underpinned by additional sales resources and product expansion.

• Strong cash position – over $4.0 million cash in bank.

• No capital requirements anticipated.

Note 1: $7.37 if adjusted for revenue from Taiwan converted to royalty. Note 2: $0.57 loss if adjusted for start up and one-off expenses. Note *3: EBITDA and NPAT restated.

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4.0 Investment Summary

• Return to profitability (EBITDA) 1H FY 2015 with revenue growth anticipated in 2015

• Strong cash position (over $4m) with no capital requirements anticipated.

• With nearly 50% of revenue coming from US and Europe, earnings are leveraged to reductions in the value of the AUD.

• Multiple “shots on goal” for material revenue growth in 2015:

• →Industrial product sales, particularly in US.

• →Recovery in auto sector, particularly in US.

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• →DataTraceDNA has a strong pipeline with new opportunities in China and US coming on line.

• →Auto spare parts opportunities particularly attractive.

• →Registers being well received in the Australian market – particularly National Marine Register & National Equipment Register – with municipal councils and utilities targeted.

• →Global expansion – Asia & Latin America targeted.

• →Newly developed products to be deployed in 2015.

• →Opportunity for CopDots in insurance sector & other geographies.

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5.1 Directors

Mr Bruce Rathie B.Com., LL.B., MBA, Grad Dip CSP, SA Fin., FAICD, FAIM Executive Chairman

Mr Rathie joined the Board as a non-executive Director and Chairman in October 2009 and was appointed Executive Chairman in January 2012. He is a lawyer having held several senior positions in investment banking and commercial law including: Managing Director, Jardine Fleming Australia Capital Ltd; Director, Corporate Finance, Ord Minnett Inc; and Director, Investment Banking, Salomon Brothers/Salomon Smith Barney Australia. Mr Rathie is now a professional company director and is, in addition to Executive Chairman of DataDot, Chairman of eftpos Payments Australia Limited, a Director of Capricorn Society Limited and PolyNovo Limited. He is a member of the DataDot Remuneration and Nomination Committee and Audit and Risk Management Committee.

Mr Gary Flowers B.Com., LL.B., FAICD Independent Non-Executive Director

Mr Flowers joined the Board as a non executive Director in November 2007. Until 2007, Mr Flowers was Managing Director and CEO of Australian Rugby Union, CEO of SANZAR and a Council Member of the International Rugby Board. From 2008 to 2013 he was COO of Mirvac Limited and also Chairman of Mirvac Hotels Group. Previously, he was National Managing Partner of Sparke Helmore Lawyers. He is currently Chairman of Mainbrace Constructions Pty Limited, Chairman of SkyFii Limited and a director of Sparke Helmore. He is Chairman of the DataDot Audit and Risk Management Committee and a member of the Remuneration and Nomination Committee.

Ms Alison Coutts B.E (Chem), MBA, Grad Dip Biotech Independent Non-Executive Director

Ms Coutts joined the Board as a non-executive Director in July 2010. Ms Coutts has degrees in Chemical Engineering and Business Administration, a Graduate Diploma in Biotechnology and extensive experience across a number of industry sectors and disciplines. This includes international engineering project management with Bechtel Corporation in the UK, USA and NZ, strategy consulting, management training and organisational structuring with

Boston Consulting Group, and executive search with Egon Zehnder. Ms Coutts is Chair and acting CEO of NuSep Holdings Limited and formerly Chair of CSIRO’s Health Sector Advisory Council. She is a member of the DataDot Audit and Risk Management Committee.

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5.2 Senior Management Operations

Mr Jim McCallum., B Science

CEO DataDot North America

Jim McCallum brings over 20 years of leadership and executive management experience spanning the technology, enterprise and digital media industries. He is a veteran who has lead growth and continuous improvement across a broad range of disciplines including corporate strategy, operations, business development, sales and product marketing.

Prior to DataDot Technology Mr. McCallum served as Vice President of Business Development at Ericsson, the global leader in cellular networks and digital solutions. Previously he served as SVP General Manager of North America and EMEA for Visionbytes, an international web and mobile video technology company. Jim also held management positions at VeriSign, Pathfire and Cox Enterprise.

Jim holds a Bachelor of Science Degree from Susquehanna University and is a member of the Atlanta Technology Development Center (ATDC) in Atlanta, GA.

Dr Gunther Schmidt., PhD (Natural Science)

Managing Director DataTrace

Dr. Gunther Schmidt brings over 20 years of international leadership and executive management experience in the B2B and consultancy environment in a wide range of industry segments. He was involved in various corporate functions as Corporate Strategy, Business Development, Sales & Marketing, Change Management, Innovation Management, Product Development, Market Due Diligence, Post Merger Integration and Supply Chain Management.

Prior to DataDot Technology, Dr. Schmidt was Partner and MD of the boutique consultancy house Synidea AG, specialized in Business Innovation. Previously he worked as management consultant at Management Engineers, Germany and in various marketing functions at Bayer AG and General Electric. Gunther holds a PhD in Natural Science from University of Hamburg, Germany

Mr Andrew Winfield., B Eng

Managing Director DataDot UK/Europe

Andrew Winfield has a strong background in B2B sales in the last 18 years, having previously been involved with automotive engineering. His experience ranges through the automotive, oil and gas, and utilities sectors where he has successfully built up sales in the European and other global markets marketing technically specialised equipment via distributor networks and key customer accounts.

Prior to DataDot Technology, Mr. Winfield was head of export Sales for a company supplying capital equipment in the water and oil and gas sector. His key role in developing strategy, and leading the sales team were instrumental in taking the business from 10m GBP T/O to over 30m GBP in just under 3 years. Andrew has responsibility for running the European factory facilities in the UK, as well as utilising his experience to re-energise the European market for DataDot technology to maximise its potential in this complex market, through both effective distributor management and expansion of direct customer links. Andrew holds a Bachelor of Engineering Degree from Middlesex University in London, UK

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6.0 Appendix

6.1 Industrial Product

• 6.2 National Registers

• 6.3 China Anti Counterfeit initiative

• 6.4 Global Genuine Parts Security Program

• 6.5 Australian and Asia and US Defence Industry 6.6 Bulk Materials

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6.1 Industrial Product

• Industrial application gains in traction with adoption by Excel Energy and Con Ed (see ASX announcements).

View Con Edison’s press release http://www.coned.com/newsroom/news/pr20140730.asp

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• Large and growing pipeline in the US.

• Theft of copper in North America is a cost to public safety, corporate productivity and profitability.

• Direct losses are substantial - insurance claims to replace stolen air conditioning units alone exceeded US$1 billion in 2010 - and productivity losses resulting from copper theft are estimated to exceed US$1 billion per annum.

• Now 100% owned.

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6.2 National Registers

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• Built on a shared platform for simple, global law enforcement access

• Insurance agencies actively support the Registers because: policy holders who participate in theft prevention programs are usually a better risk; a theft alert enhances the likelihood of recovering the asset, the risk of fraudulent claims is diminished, investigators are motivated.

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6.3 China Anti Counterfeit Initiative

• Capitalise on new Chinese Govt regulations aimed at stamping out counterfeit consumer products manufacturing.

• Work with our existing clients in alcohol, tobacco, pharmaceutical, automotive and spectacle frame industries and their industry associations to increase recognition of the fail-safe nature of our DataTraceDNA technology.

• Proven advantages are copy-proofing, stopping divergence – including out of territory trading by distributors, false warranty claims, brand reputational damage caused by sub-standard substitutes.

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6.4 Global Genuine Parts Security Program

The purpose of the DataDot Technology Genuine Parts Security Programme is to protect the integrity of the OEM Brands and legitimise authentic parts in response to damaging activities of:

• Counterfeit Manufacturers

• Third Shift Operations

• Parallel Imports

The outcomes targeted by the programme :

• Ensuring OEM customer safety/corporate integrity

• Mitigating risk of liabilities for failed false parts

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• Minimising warranty obligations against false parts

• Creating imperatives for authentic parts for insurers and repairers

• Increased sales for legitimate OEM parts

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6.5 Australian and Asia and US Defence Industry

• Counterfeiting is a major risk within the military and defence materiel industry.

• In the US and Asia and Australia, investigations are underway to reduce this risk.

• DataDot Technology solutions are being considered in these investigations.

• A wide range of potential applications are possible, including but not limited to:

• Assets and Parts

• Explosives and their chemical precursors

• Weapons and Ammunition

• ID and Security Cards

o Documents

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6.6 Bulk Materials

• DataTrace has identified as a growth area the application of its technology in industrial bulk materials. Selected industry segments are

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• Construction materials (paints, coatings, concrete)

• Agricultural products (seeds, fertiliser)

• Benefits include anti-counterfeit protection, eliminating false warranty claims and improving quality control.

• These high-volume segments are not comprehensively serviced by covert authentication solutions and therefore offer a promising opportunity for growth and differentiation.

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• DataTrace is developing an innovative reader which will make the technology commercially feasible to be used in bulk materials.

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