ELECTRO OPTIC SYSTEMS HOLDINGS LIMITED — AGM Information 2016

May 29, 2016

EOS

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Company Update 30 May 2016

This document contains proprietary and copyright material which may not be copied or distributed without the consent of EOS. EOS Proprietary

ELECTRO OPTIC SYSTEMS HOLDINGS LIMITED

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PROXY SUMMARY FOR ANNUAL GENERAL MEETING ON FRIDAY 30 MAY 2016 AT 9.30 AM

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Disclaimer

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This presentation and any related communication may contain statements that are forward looking with regard to the business and future performance of Electro Optic Systems Holdings Limited [“EOS”] and its subsidiaries.

These statements reflect EOS’ current views, assumptions and projections based on, but not limited to, currently available information with regard to its existing and potential customers, markets and the prevailing economic conditions.

These statements involve risks and uncertainties which cause EOS actual financial may may performance to differ materially from those inferred from any forward-looking statements. Such statements, therefore, should not be regarded as an expressed or implied forecast of the future financial performance of EOS. You are cautioned not to put undue reliance on this presentation.

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SUMMARY

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1. Results for 2015

2. Defence Systems Sector200 200

3. Space Systems Sector

4. Outlook

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Revenue (A$ millions)

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35.0
30.0
25.0
20.0
15.0
10.0
5.0
-
200
2012 2013 2014 2015
6
Profit (A$ million)
4.0
2.0
0.0
2012 2013 2014 2015
-2.0
-4.0
-6.0
-8.0
-10.0
-12.0
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FINANCIAL SUMMARY

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1. Profitable as forecast

2. Cash at 2x 4-year average

3. Stable revenue (ca. $27M) excludes product impact 4. Margin improved to 10% net in 2015

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Cash (A$ million)
14.0
12.0
10.0
8.0
6.0
4.0
2.0
0.0
2012 2013 2014 2015
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Defence Sector: Status and Outlook

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P
P
p
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EOS RWS Product Family

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 R-1600 Turret [1600 kg]  R-600 Dual [400 kg]  R-400 [CROWS 1] [200 kg]  R-200 [100 kg]

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All RWS are plug-and-play compatible and have common LRU and training

R-400S firing on M-ATV

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Key Developments and Trends: Defence

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1. Profitable and at full capacity with current facilities 2. Diversified customer base in Europe, Asia and Australia 3. New licensed production site in Asia came on line 3. Unprecedented product inquiry rates and demonstration bookings 4. New products have strong prospects in major programs globally 5. Support revenue growing as more units deploy and age 6. Production output and quality increased through 2015 in an initial response to long-term programs for continuous improvement Global trends suggest the business environment will improve thru 2016

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Copyright EOS R-400S firing on NIMR
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Space Sector: Status and Outlook

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EOS Proprietary

Key Developments and Trends: Space

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1. Space Network Expansion

EOS capacity in the ACT will increase by 50% in 2016 with a new telescope installation.

A new site in Western Australia is expected to achieve initial operations in Q3 2016.

An additional new site in Queensland is expected to be operational in Q3-2017. This expansion is funded and will establish a fully resilient EOS tracking network for key space data customers. The network will establish EOS as the largest provider of space data in this hemisphere by Q4 2017.

Network Expansion 2016/17

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Site 2 Site 3 Site 1

These three sites are independent in terms of weather and collectively provide highly reliable space services.

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Unclassified

EOS Space Tracking Facility: WA

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With sites in WA, QLD and ACT, EOS will be the largest provider of space data in this hemisphere

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Key Developments and Trends: Space

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1. Space Network Expansion

1. Defence White Paper

The Commonwealth of Australia’s Defence White Paper, Industry Policy and Infrastructure Investment Plan were released early in 2016. These indicate outlays of up to $2 billion over 20 years for space data by Australia.

EOS capabilities will be vigorously competing for contracts which apply those funds.

Key Developments and Trends: Space

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1. Space Network Expansion

2. Defence White Paper

1. New Technology

EOS developments in adaptive optics will soon allow EOS sensors to improve data acquisition efficiency and accuracy, as well as increase data transmission and receiving capacity, beyond all expectations up to now.

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Key Developments and Trends: Space

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1. Space Network Expansion

1. Defence White Paper

2. New Technology

3. Space Data Agreements

Negotiations with parties for space data access are ongoing. The key requirement of having available capacity is rapidly being met by EOS deploying its tracking network, which reaches critical mass and resilient operational status in 2017.

OUTLOOK

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Market requirements for EOS weapon systems across Asia, Europe and the Middle East are growing due to escalation of threats, confrontation and actual conflict. EOS is well placed in all those markets because its advanced products provide cost-effective defence capability.

However drastic falls in the price of oil and other resources have reduced defence funding in developing economies, even as regional conflicts escalate. At the same time there has also been a deterioration of government revenue and consequently defence funding in developed economies, even as strategic 200 200 threats escalate. These conflicting pressures have caused delays in order placement, and have added 6 7 uncertainty to EOS revenue forecasts.

However overall the outlook for defence systems sector remains positive. Growth is expected to continue, but with significant disruption to contract award processes.

The outlook for space sector is also positive. EOS is rapidly building its space infrastructure to achieve critical mass of capability to meet customer demand for reliable and accurate space data. Customer contract negotiations are building momentum as EOS capacity expands. EOS expects to be profitable in the first half of 2016, and to hold in excess of $6 million in cash at 30 June 2016.

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