USCOM LIMITED — Investor Presentation 2015

Oct 1, 2015

**October

2015 Uscom
(UCM)
–
Global
Medical Devices
and
Revenue
Growth**

Rob Phillips

PhD(med), MPhil(med), FASE, DMU(cardiol) Associate Professor, Critical Care Research Group, School of Medicine, The University of Queensland Executive Chairman/CEO

The Measure of Life

Disclaimer

This
presenta,on
is
intended
to
provide
a
general
outline
only
and
is
not
intended
to
be
a
defini,ve statement
on
the
subject
ma9er.
The
informa,on
in
this
presenta,on,
whether
wri9en
or
verbal,
has been
prepared
without
taking
into
account
the
commercial,
financial
or
other
needs
of
any
individual or
organisa,on.

While
Uscom
(the
"Company”)
has
taken
due
care
in
compiling
the
informa,on,
neither
the
Company nor
its
officers
or
advisors
or
any
other
person
warrants
the
accuracy,
reliability,
completeness
or ,meliness
of
the
informa,on
or
guarantees
the
commercial
or
investment
performance
of
the Company.
Certain
informa,on
may
relate
to
protected
intellectual
property
rights
owned
by
Uscom. By
viewing
this
presenta,on
the
viewer
accepts
the
terms
of
the
accompanying
Company
NDA. The
informa,on
does
not
cons,tute
advice
of
any
kind
and
should
not
be
relied
on
as
such.
Investors must
make
their
own
independent
assessment
of
the
Company
and
undertake
such
addi,onal enquiries
as
they
deem
necessary
or
appropriate
for
their
own
investment
purposes.
Any
and
all
use of
the
informa,on
is
at
your
own
risk.

2

Disclaimer

==> picture [649 x 415] intentionally omitted <==

3

Uscom

“A rapidly growing Australian medical device company with world leading products and a strategic global vision…”

4

Uscom

_**“Products

generate
profit”**_

Outstanding
science Experienced
and
sector
leading
people High
growth
(+50%
pa),
innova,ve
medical
device
company Key
cardiovascular
pulmonary
markets
with
mul,ple
products De-­‐risked
technology Strategic
growth
from
recent
acquisi,ons Valuable
IP
with
high
margins
(75+%) Growth
from
US
focus
and
reimbursement Marke,ng
of
new
product
lines Fundamentals
to
drive
value Value
investment

5

==> picture [701 x 395] intentionally omitted <==

6

Uscom vision

Company
of
the
Year,
2014 Johnson
&
Johnson
InnovaAon
Industry
Excellence
Awards “A
milestone
driven,
rapidly
growing
global medical
device
company,
with
real
products, real
revenue,
real
growth
and
an
aggressive growth
strategy”

==> picture [368 x 47] intentionally omitted <==

==> picture [204 x 90] intentionally omitted <==

7

Current Business

§ Premium
noninvasive
cardiovascular
and
pulmonary
monitoring
devices § Addressing
the
growing
threat
of
superbugs,
heart
failure,
hypertension
and
asthma § Validated,
clinically
accepted,
cost
and
life
saving
devices
with
cri,cal
applica,ons § IP
protected
with
regulatory
approvals § Uscom
BP+
for
market
2016
-­‐
$7m
over
5years
Chinese
contract
in
place § +50%
revenue
growth
in
Asia
and
Europe,
with
US
market
ahead

• Corporate Board
  &
  Management Financials

• § ASX
  listed
  (UCM) § Rob
  Phillips,
  Chairman
  &
  CEO § Sales
  +59%
  2015 § Headquartered
  in
  Sydney § Sheena
  Jack,
  Director § Revenue
  +48%
  2015 (HCF,
  Money,me
  Health) ($2+m)

• § Market
  cap
  of
  $15m § Chris,an
  Bernecker,
  Director § Cash
  consump,on
  -­‐
  <$1m

• § 92m
  shares
  on
  issue (Stream) § Gross
  Margins
  ~
  78%

• § Rob
  Phillips,
  Founder
  and § Nick
  Schicht,
  General
  Manager

• CEO,
  holds
  20%
  of § Cash
  ~
  $2m company

8

• Uscom
  Annual
  report

Strategic growth _**Complementary

products
and
technology**_

**Fluid,

Sepsis &
Heart
Failure** § US
1.3bn
market[
*
]

• § CAGR
  of
  7.6%[

• ]

• § CE,
  FDA,
  TGA,
  CFDA

Hypertension
& Vascular
Health

• § US
  1.7bn
  market[
  *]

• § CAGR
  of
  11.5%[

• ]

• § CE,
  FDA,
  TGA

COPD &
Asthma

• § US
  400m
  market[
  *]

• § CAGR
  of
  6.5%[

• ]

• § CE,
  TGA,
  FDA

USCOM
1A Cardiac
Output
Monitoring

==> picture [176 x 181] intentionally omitted <==

BP+ Blood
Pressure
Monitoring

==> picture [122 x 124] intentionally omitted <==

Acquired
July
2013

Thor Pulmonary
Monitoring

==> picture [162 x 99] intentionally omitted <==

Acquired
Sept
2015

9

• Source:
  MedTech
  Insight;
  Transparency
  Market
  Research

USCOM 1A

Non invasive, accurate, compact technology platform solution Heart failure, hypertension, sepsis

Accurate cardiac output Cardiac stroke volume Systemic vascular resistance Left + right heart measurement

==> picture [285 x 232] intentionally omitted <==

Works with all other hospital equipment Intuitive touch screen Real time data Platform technology with multiple uses

Non invasive, real time, beat-to-beat haemodynamics

10

Uscom BP+

==> picture [119 x 71] intentionally omitted <==

Central BP - New Wave Supra-systolic Oscillometry Central Blood Pressure and Pulse Pressure Wave Analysis The new standard for hypertension

• FDA, CE Mark, TGA approvals

• Supra-systolic Central BP+

• Reliable and

• • accurate

• • Central and

• • Brachial BP

• • Replaces sub-systolic methods (cuff)

• Home or clinic

• PPW Analysis

• Results in

• 30 seconds

No training required Platform

technology with multiple uses

Stand alone, non invasive, accurate, compact system

11

Uscom Thor Spirometry

Central BP – High fidelity digital Ultrasonic spirometry For asthma, COPD, and drug compliance monitoring

• Digital ultrasonic spirometry

• Dual pathway ultrasonic sensing

• FDA, CE Mark, TGA approvals

==> picture [163 x 99] intentionally omitted <==

• Reliable and accurate

• Auto calibration

• Research, home and clinic

• Wireless transmission

• Thorsoft analysis software

==> picture [41 x 47] intentionally omitted <==

==> picture [255 x 144] intentionally omitted <==

• FloFree tube – low resistance

• Software guided examination and report

• Simple to sterilise

• Platform sensors with medical and industrial applications

Stand alone, non invasive, accurate, compact system

12

De-Risked technology

Featured in 400+ peer reviewed publications and presentations

==> picture [95 x 126] intentionally omitted <==

==> picture [91 x 108] intentionally omitted <==

==> picture [97 x 112] intentionally omitted <==

==> picture [94 x 116] intentionally omitted <==

==> picture [89 x 106] intentionally omitted <==

==> picture [85 x 104] intentionally omitted <==

==> picture [91 x 103] intentionally omitted <==

==> picture [87 x 102] intentionally omitted <==

==> picture [87 x 104] intentionally omitted <==

==> picture [74 x 99] intentionally omitted <==

Sepsis, Heart failure, Hypertension, Fluid management, Emergency, Pediatrics, Cardiac transplantation, Electrophysiology, Emergency transport, Anesthesia, Liver transplantation, ICU, Pre-eclampsia, Pulmonary hypertension, Nurse outreach, Organ procurement, Haemodialysis, Neonates, infants, Children etc……..

13

Global People

Nick Schicht Steve Haken Andrew Kenig Denise Pater Tina Wu Rik Denicke Rob Phillips

==> picture [103 x 116] intentionally omitted <==

==> picture [95 x 117] intentionally omitted <==

==> picture [93 x 116] intentionally omitted <==

==> picture [86 x 119] intentionally omitted <==

==> picture [96 x 116] intentionally omitted <==

==> picture [79 x 117] intentionally omitted <==

==> picture [98 x 118] intentionally omitted <==

Global Euro Aus Global Global USA Global

Bev Jacobson Richard Scott George Tang Lindy Belleza George Ferenczi Hagay Gilad Steve Wilson

==> picture [88 x 117] intentionally omitted <==

==> picture [99 x 115] intentionally omitted <==

==> picture [95 x 116] intentionally omitted <==

==> picture [91 x 115] intentionally omitted <==

==> picture [91 x 116] intentionally omitted <==

==> picture [87 x 116] intentionally omitted <==

==> picture [95 x 117] intentionally omitted <==

Global Global Aus Aus Global Aus USA

14

Results - Growth

==> picture [681 x 299] intentionally omitted <==

----- Start of picture text -----

Revenue and Income
Distribution Agreements
$2,500,000
40 38
$2,039,426
$2,000,000 35
30 27
$1,500,000 $1,377,716
25
$1,010,942 20
$1,000,000
15 12
10
$500,000
5
$0 0
2013 2014 2015 2013 2014 2015
----- End of picture text -----

Current
revenue
only
from
USCOM
1A BP+
and
Thor
revenue
in
2016 DistribuAon
–
sales
–
revenue

15

==> picture [206 x 128] intentionally omitted <==

New Acquisition

==> picture [204 x 85] intentionally omitted <==

==> picture [159 x 100] intentionally omitted <==

_**Uscom

has
acquired
100%
of
Thor
Laboratories
-­‐
Asthma**_

*

Company
Overview

• § High
  fidelity
  digital
  Doppler
  spirometry
  devices

• § Established
  manufacturing
  -­‐
  15
  years

• § Global
  reach

• § Reimbursement
  in
  mul,ple
  markets

• § Strong
  R&D
  and
  grant
  history

• § Partners
  in
  Home
  Care
  Asthma
  in
  the
  USA

Uscom
benefits

• § Cash
  flow
  posi,ve,
  revenue
  of
  $500k

• § Accredited
  interna,onal
  manufacturing

• § 4

• 3
  products,
  CE,
  FDA,
  TGA
  approvals

• § Global
  distribu,on

§ Technical
R&D
team
16
engineers

• § Marke,ng
  and
  management

Synergy
of
science,
operaQons
and
strategy

16

• Agreement
  subject
  to
  DD
  and
  Uscom
  capital
  raise

New Products - Asthma **Products

in
Market New
Products**

**New

Products**

Digital
Doppler
Spirometer Home
use

With
DiagnosQcs
and
WIFI Digital
wifi
spirometer

Professional
System Desktop
with
advanced
sopware
analy,cs

==> picture [182 x 115] intentionally omitted <==

==> picture [181 x 103] intentionally omitted <==

New
–
AsthmaHero Drug
delivery
measure Telemetry
to
iPhone
app Smart
spacer Pa,ent
interac,ve

==> picture [145 x 131] intentionally omitted <==

==> picture [129 x 82] intentionally omitted <==

==> picture [128 x 100] intentionally omitted <==

New
-­‐
BreatheSmart Digital
wifi
spirometer Remote
clinical
monitoring Cloud
diagnosis

New
-­‐
Whistler Neonatal
Asthma
diagnos,c

17

People and Manufacturing

Post acquisition headcount

Total Headcount

40 34 35 30 25 +183% 20 15 12 10 7 5 0 Uscom 2011 Uscom 2015 Uscom 2016

Combined Headcount

==> picture [305 x 199] intentionally omitted <==

----- Start of picture text -----

7
Manufacturing and
6
engineering
5
4
3
2
1
0
Headcount
----- End of picture text -----

==> picture [282 x 58] intentionally omitted <==

Thor Uscom

More people and More Manufacturing = More Revenue

18

Thor Manufacturing

==> picture [222 x 166] intentionally omitted <==

ü Global
approvals ü Manufacturing
and
R&D ü Experienced
engineers ü Established
reputa,on ü USCOM
and
BP+
reserve ü University
Budapest
links

==> picture [213 x 154] intentionally omitted <==

==> picture [214 x 144] intentionally omitted <==

==> picture [223 x 147] intentionally omitted <==

==> picture [217 x 144] intentionally omitted <==

InternaAonally
ISO
accredited
medical
device
manufacturing

15

Revenue Targets

==> picture [621 x 375] intentionally omitted <==

----- Start of picture text -----

Thor
Total Revenue
20,000,000
18,000,000
16,000,000
BP+
14,000,000
12,000,000
Thor
$ 10,000,000
BP+
USCOM
8,000,000 USCOM
6,000,000
4,000,000
2,000,000
0
2015 2016 2017 2018 2019 2020
----- End of picture text -----*

_**$20m

revenue
by
2020
-­‐
5
year
CAGR
of
58%**_

20

Maintaining growth

OperaQons
growth 1. Uscom
Aus 2. Uscom
UK 3. Uscom
Budapest 4. Uscom
USA

2 • •• ••• •[•] •[•][•] 3 • • • •[•] •[•] •• •

4 •[•] • • • • • • • • • • • •

• •

[•] 1

• Key
Markets • • 1.
AsiaPAC
–
65% 2/3.
Europe
–
27% 4.
Nth
America
– 8%

==> picture [90 x 111] intentionally omitted <==

US
Focus
2016 Stephen
Wilson
–
Former
VP
Corporate Development
Welch
Allyn
appointed

21

The Future

_**Value

Cascade**_

Comple,on of Capital Raise Products USCOM 1A Uscom BP+ Spirotube O9hon S roDesk BreatheSmart AsthmaHero ThorSop		Sales New appointments Current distribu,on Thor distribu,on New distribu,on Major partners Re-imbursement US market focus		OperaQons Global opera,ons Increased products Increased scale Cost efec,ve manufacture Revenue growth Proftability		OpportuniQes Share price growth Dividend Transac,on
Comple,on of Capital Raise USCOM 1A Uscom BP+ Spirotube O9hon S roDesk BreatheSmart AsthmaHero ThorSop							Share price growth Dividend Transac,on

Products
–
Sales
–
Revenue
-­‐
OpportuniAes

22

Business Risks & Mitigants

§ Global markets unpredictable § Compe,,veness of market sectors § Thor integra,on & key staf reten,on § Ongoing Thor business management § Thor distrac,on from USCOM & BP+ § Regulatory costs and ,melines § Distribu,on & revenue growth § Working capital requirements to meet increased product demand Risks		§ Diversifed and expanded products § Senior sales and marke,ng personnel § Earn outs in Thor deal structure § Earn outs in Thor deal structure § Product and revenue diversifca,on § Addi,onal focused resources § Key Uscom and Thor staf § Addi,onal WC from capital raise MiQgants

23

UCM Investment

==> picture [444 x 289] intentionally omitted <==

----- Start of picture text -----

ASX 10yr CAGR
14
12
10
8
% 6
4
2
0
Mining Financials Health BHP NAB Resmed
-2
----- End of picture text -----

UCM
sales
growth 2014
–
67% 2015
–
59%

Health
is
Growth,
UCM
is
more
growth

24

ASX:UCM

**Disconnect

between
performance
and
price But
markets
ulQmately
align!**

==> picture [662 x 263] intentionally omitted <==

----- Start of picture text -----

UCM share price Revenue and Income
$4,000,000
$3,500,000
$3,500,000
$3,000,000
$2,500,000
$2,039,426
$2,000,000
$1,377,716
$1,500,000
$1,010,942
$1,000,000
$500,000
$0
2013 2014 2015 2016
----- End of picture text -----*

Tightly
held,
few
traders,
difficult
to
acquire
volume

9

• Estimate

Industry comparators

==> picture [685 x 347] intentionally omitted <==

----- Start of picture text -----

Reported and Predicted EBITDA Capitalised Value
2 100
1.5 88
90
1.5
80
1 0.8
70
0.5
0 0 0 0 60
0 50 46.7 x7
-0.5 UCM ACG ADH 40
30
-1 x4
20
-1.1 12.5
-1.5
FY 15 10
-2
FY16 0
UCM ACG ADH
-2.5 FY 17
-2.3
-2.6
-3
AUD (m)
AUD (m)
----- End of picture text -----

*
-­‐
esAmate ADH
–
no
forecast
available
in
market

26

Uscom

✓ Value
investment ✓ Experienced
management ✓ Strong
underlying
business ✓ Strong
growth
phase ✓ Invested
in
future
growth ✓ Premium
global
markets ✓ Diversified
and
lifesaving
technologies ✓ Aggressive
global
growth
strategy ✓ Two
new
product
ranges
for
market
in
the
next
12mths ✓ Right
Tme
–
Q1
2016
results
imminent

27

**October

2015 Uscom
(UCM)
–
Global
Medical Devices
and
Revenue
Growth**

Thanks

Rob Phillips

PhD(med), MPhil(med), FASE, DMU(cardiol) Associate Professor, Critical Care Research Group, School of Medicine, The University of Queensland Executive Chairman/CEO

USCOM 1A Competitive Advantage

Method	Manufacturer	Technology	Rel+Rep	Non- invasive	Simple	Cost	Portable	SV beat to beat
USCOM 1A	Uscom	Doppler	✓	✓	✓	✓	✓	✓
BioZ	Samsung	BioImpedance	✗	✓	✓	✗	✓	✗
NiCOM	Cheetah	BioReactance	✗	✓	✓	✗	✓	✗
Nexfin	Bmeye	APP	✗	✓	✓	✓	✓	✗
CardioQ	Deltex	Doppler	✓	✗	✓	✗	✓	✗
LiDCO	LiDCO	LiCl dilutio +APP	✓	✗	✗	✗	✗	✗
LiDCOrapid	LiDCO	APP	✗	✗	✓	✗	✗	✗
PiCCO (mod Tx + PP)	Pulsion	APP	✓	✗	✗	✗	✗	✗
FloTrac	Edwards	APP	✗	✗	✗	✗	✗	✗

29

Testimonials

“This
machine
is
saving
lives,
there
are
no
two
ways
about
it.”

Professor
Brendan
Smith,
AnestheTst,
Intensivist
and
Emergency
Physician,
N.S.W.
Dept
of
Health,
Australia

“USCOM
has
changed
the
way
I
look
at
the
cardiovascular
status
of
my
paTents. It’s
part
of
the
iniTal
shock
evaluaTon
and
monitored
regularly
therea]er….
USCOM
has
now
been established
as
the
standard
of
care.”

Dr
Akash
Deep,
Director
of
Paediatric
ICU,
King's
College
Hospital,
London

“The
USCOM
device
is
a
simple
method
of
accurately
and
noninvasively
measuring
central
circulaTon,
a goal
of
cardiology
for
many
years.
The
device
has
the
potenTal
to
change
the
way
we
approach management
of
sepsis,
heart
failure
and
hypertension.”

Professor
Malcolm
West,
Cardiologist,
Mayne
Professor
of
Medicine
at
The
University
of
Queensland
School
of
Medicine,
Brisbane,
Australia
and
Uscom
Medical
Advisory
Board Member.

“I
have
used
USCOM
for
over
5
years
now
on
our
very
sick
children,
and
use
it
to
guide
management. We
are
now
beginning
mulT-­‐centre,
global
research
which
will
define
the
way
USCOM
is
used
in Paediatric
Departments
across
the
world.”

Dr
Joe
Brierley,
Consultant
Intensivist,
Great
Ormond
Street
Hospital
for
Sick
Children,
London,
UK.

“The
USCOM
device
is
really
good;
I
use
it
in
all
my
aneastheTcs.
I
think
there
should
be
one
on
every ICU
bed
and
on
every
anaestheTc
paTent.”

Dr
Steve
Woodford,
Consultant
AnaestheTst,
circulatory
researcher
at
Australian
School
of
Advanced
Medicine,
and
Uscom
Investor,

“To
parents
and
doctors
this
machine,
USCOM,
is
priceless.
This
machine
is
thought
to
have
saved
baby

Abbie’s
life.

BBC
Documentary
“New
machine
helps
save
babies
life”,
2010,
Nofngham
Children’s
Hospital

30

==> picture [163 x 195] intentionally omitted <==

BP+ Competitive Advantage

==> picture [87 x 88] intentionally omitted <==

==> picture [121 x 83] intentionally omitted <==

==> picture [125 x 81] intentionally omitted <==

==> picture [97 x 69] intentionally omitted <==

Uscom BP+	TensioMed	BPLab	IEM	Centron	AtCor
Australia	Hungary	Russia	Germany	UK	Australia
USD 3,500	USD 6,000	USD 7,000	USD 7,000	USD 6,300	USD 20,000
1 min	2 min	2 min	2 min	1 min	1 min
Stand-alone	ABP, needs computer	ABP, needs computer	ABP, needs computer	Stand-alone	Needs computer
CE, FDA, TGA	CE	CE	CE, FDA	CE	CE, FDA
Aortic + brachial waveform	Central systolic BP	Rough waveform	Rough waveform	Rough waveform	Rough waveform
Physical model	Statistical regression	Transfer function	Transfer function	Transfer function	Transfer function

31

Why ?

_**Independent

research
from
Cambridge
University,
Weill
Cornell, University
of
California,
Wales
Heart
InsAtute
–
BP+
=
Four
stars**_

==> picture [604 x 274] intentionally omitted <==

_**BP+

is
on
the
internaAonal
space
staAon**_

36

McEniery CM, Cockcroft JR, Roman MJ, Franklin SS, Wilkinson AB. Central blood pressure: current evidence and clinical importance. Euro Heart J 2014;doi10.1093/ eurojeartj/eht565

Thor Competitive Advantage

==> picture [87 x 50] intentionally omitted <==

==> picture [100 x 100] intentionally omitted <==

==> picture [90 x 67] intentionally omitted <==

==> picture [74 x 80] intentionally omitted <==

==> picture [70 x 69] intentionally omitted <==

==> picture [82 x 81] intentionally omitted <==

==> picture [68 x 71] intentionally omitted <==

==> picture [92 x 70] intentionally omitted <==

Uscom Thor	Welch Allyn	Schiller	Sibelmed	Vitalograph	MIR	Carefusion	NDD
Australia	USA	Switzerland	Spain	USA	Italy	USA	Switzerland
USD 1,790	USD 2,100	USD 1,850	USD 2,300	USD 2,030	USD 1,750	USD 2,180	USD 1,990
Dual Path Ultrasound	Diff Pressure	Diff Pressure	Turbine	Diff Pressure	Turbine	Turbine	Single Path Ultrasound
Accurate Auto calibration SpiroReporter Fully digital FreeFlo sensor Hygeinic	Multiple iterations	Multiple iterations	Multiple iterations	Multiple iterations	Multiple iterations	Multiple iterations	Accurate

33