Attached files
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| 8-K - HERLEY INDUSTRIES INC /NEW | h8k.htm |
| EX-99.1 - PRESS RELEASE - HERLEY INDUSTRIES INC /NEW | exhibit1.htm |
Exhibit 99.2
2
Except for the historical information contained herein, this presentation may contain forward-looking
statements. Such statements are inherently subject to risks and uncertainties. Forward-looking statements
involve various important assumptions, risks, uncertainties and other factors which could cause our actual
results to differ materially from those expressed in such forward-looking statements. Forward-looking
statements in this discussion can be identified by words such as "anticipate," "believe," "could," "estimate,"
"expect," "plan," "intend," "may," "should," "we look forward" or the negative of these terms or similar
expressions. Although we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, performance or achievement. Actual results could differ
materially from those contemplated by the forward-looking statements as a result of certain factors including,
but not limited to, competitive factors and pricing pressures, changes in legal and regulatory requirements,
cancellation or deferral of customer orders, technological change or difficulties, difficulties in the timely
development of new products, difficulties in manufacturing, outcome of pending litigation, commercialization
and trade difficulties and current economic conditions, including the potential for significant changes in US
defense spending under the current Administration which could affect future funding of programs, and
allocations within the budget to various programs, as well as the factors set forth in our public filings with the
Securities and Exchange Commission. We undertake no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
statements. Such statements are inherently subject to risks and uncertainties. Forward-looking statements
involve various important assumptions, risks, uncertainties and other factors which could cause our actual
results to differ materially from those expressed in such forward-looking statements. Forward-looking
statements in this discussion can be identified by words such as "anticipate," "believe," "could," "estimate,"
"expect," "plan," "intend," "may," "should," "we look forward" or the negative of these terms or similar
expressions. Although we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, performance or achievement. Actual results could differ
materially from those contemplated by the forward-looking statements as a result of certain factors including,
but not limited to, competitive factors and pricing pressures, changes in legal and regulatory requirements,
cancellation or deferral of customer orders, technological change or difficulties, difficulties in the timely
development of new products, difficulties in manufacturing, outcome of pending litigation, commercialization
and trade difficulties and current economic conditions, including the potential for significant changes in US
defense spending under the current Administration which could affect future funding of programs, and
allocations within the budget to various programs, as well as the factors set forth in our public filings with the
Securities and Exchange Commission. We undertake no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
John A. Thonet
Chairman of the Board
Richard F. Poirier
Chief Executive Officer
and President
ž Markets include U. S. Military, Defense Contractors and
Allied Countries
Allied Countries
ž 1,000 employees at seven manufacturing facilities
ž Established in 1965. 2010 marks our 45th anniversary
ž Corporate Office in Lancaster, Pennsylvania
ž NASDAQ : HRLY
ž Revenues: FY 2010: $188 million
ž Leading supplier of electronic components and systems
specializing in microwave and millimeter wave technology
specializing in microwave and millimeter wave technology
ž Provide Design, Engineering and Manufacturing expertise to
meet high performance requirements
meet high performance requirements
ž Offer standard products to highly complex integrated systems
ž Goal is to be the market leader and “go-to” source for
microwave technology products and solutions
microwave technology products and solutions
ž FY 2010 sales to U. S. Government were approximately 15%,
ž FY 2010 sales to Northrop Grumman were 20% and Lockheed Martin were 13%
ž No other customer accounted for 10% or more of consolidated net sales
for FY 2010
Jan. 1999
General Microwave
General Microwave
Sept 2000
Mar. 2004
ž In 1992, Herley’s senior management made the strategic decision to take
advantage of the fragmented nature of the microwave industry and began
an acquisition plan to transform Herley into a focused and full service
defense microwave technology company
advantage of the fragmented nature of the microwave industry and began
an acquisition plan to transform Herley into a focused and full service
defense microwave technology company
ž Key to Herley’s growth strategy was acquiring complementary microwave
technologies and component level businesses and fusing the respective
technologies into one company, making the divisions both suppliers and
customers of each other
technologies and component level businesses and fusing the respective
technologies into one company, making the divisions both suppliers and
customers of each other
ž Consolidated acquisitions into six current production facilities
EWST
Herley
GMI EYAL
Micro Systems
Herley CTI
Herley
Lancaster
Herley
New England
Herley GMIC
Approximately 1,000 employees at seven manufacturing facilities, four in
the United States one in the UK, and two in Israel
the United States one in the UK, and two in Israel
($Millions; FY Ending July 31)
EA-18G
Trident
F-16
LAMPS
F-18
AMRAAM
EA-6B
SSST
SPEWS II
F-15
IFF
CALCM
AFSAT
ž Receiver/Exciter Subsystem
ž Receiver Protectors
ž Frequency Generator Subsystem
ž Landing Systems
ž Synthesizers
ž Low Noise Amplifiers
ž Phase Shifters
ž FET Amplifiers
ž Step Attenuators
ž Oscillators
ž Up/Down Converters
ž Altimeters
ž Simulators
ž Integrated Microwave Assemblies
F-15
F-16
F-18
Gripen
Firefinder
Eurofighter
ž Integrated Microwave Assemblies
ž Integrated Threat Radar, ECM,
Target Generation
Target Generation
ž Simulator Systems
ž CHAMELEON II ECM/Target
Generator
Generator
ž RSS8000 Series Radar Threat
Simulators
Simulators
ž MERTS Mobile EW and Radar Test
System
System
ž Radar Environment Simulators
(RES)
(RES)
ž Digital RF Memories (DRFM)
ž Power Amplifiers
ž Receiver Protectors
ž Receivers
ž Synthesizers
ž Hybrid Circuits
E-2C
E-2D
EA-6B
EA-18G
Rivet Joint
Test Ranges/Systems
|
ž Communication Jamming Systems
ž Ultra Wideband High Power Amplifier
ž 20 to 500 MHz in a single band
ž AM, FM, FSK, PSK, CW signals
ž Up to 600 W RF Output Power
ž Next Generation Network Radio
ž Power Amplifier Module
ž 225 to 400 MHz
ž 32-W CW Output Power
ž Extended Range Communications
ž UHF External Power Amplifier
ž 225 to 400 MHz
ž 100-W Output Power
ž Real-time Broadband Internet Service
ž Airborne SATCOM Power Amplifier
ž 128 kb/s Data Rate
ž 1600 to 1660 MHz
|
Missile Seekers
Communication
Systems
Systems
Medical & Scientific
IED Countermeasures
Jamming Systems
ž Radar and IFF Transponders
ž Flight Termination Receivers
ž Flight Termination Transmitters
ž PCM Encoder Systems
ž Telemetry Receivers
ž Mobile/Integrated Range
Instrumentation
Instrumentation
ž Radar Altimeters
ž Scoring Systems
ž GPS/INS Trackers
ž GPS Translators
ž Antennas
ž Test Sets
ž Encryption Modules
ž Integrated Telemetry Receive Station
ž Data Links
ž Instrumentation Support Packages
Trident II D-5
AMRAAM
SM3/SM6
JAGM
CALCM
JASSM
SDB
MALD
ž Command and Control Ground Stations
ž System of choice for US Army, US Navy,
and several international customers
and several international customers
ž Capable of flying four targets
simultaneously
simultaneously
ž GPS Waypoint navigation and Mission
planning
planning
ž Over-the Horizon capability to 400 NM
ž Software configurable to fly a variety of
targets
targets
ž Airborne Avionics
ž Command and control transponders
adaptable to Iridium based technology
adaptable to Iridium based technology
ž Built-in GPS receiver
ž Auto-pilots
ž Scoring systems
ž Identification Friend or Foe (IFF)
transponders
transponders
ž Power management and conditioning
ž Electro-explosive devices
ž Radar tracking beacons
BQM-34
BQM-74
MQM-107
BQM-167
QF-4
QF-16
Nuclear Magnetic Resonance (NMR)
Magnetic Resonance Imaging (MRI)
ž High Power Amplifiers
ž Rack-mounted amplifiers
ž Include detection/protection circuitry
ž Built-in power supplies
ž Front panel metering and interface
controls
controls
ž Well-diversified among mission-critical platforms
ž High barriers to entry limit competition
ž Cost and Length of development cycle
ž Risk associated with environmental and system
qualification
qualification
ž 45 years of dedicated service to the microwave
industry
industry
ž Proven performance leads to increased content
EA-18G
Trident
F-16
LAMPS
F-18
AMRAAM
EA-6B
MSST
SPEWS II
F-15
CALCM
The NASDAQ Global Select Market: HRLY
approximately 13.8 million shares outstanding at Fiscal Year End
approximately 13.8 million shares outstanding at Fiscal Year End
|
|
FY2007
(7/30/07)
|
FY2008
(8/3/08)
|
FY2009
(8/2/09)
|
FY2010
(8/1/2010)
|
|
Revenues
|
$137,850
|
$136,088
|
$160,089
|
$188,123
|
|
International Revenues
|
27%
|
32%
|
33%
|
34%
|
|
Operating Income (loss)(1)
|
$9,666
|
$(5,659)
|
$(3,326)
|
$21,609
|
|
LT Debt (1)
|
$5,951
|
$7,092
|
$12,246
|
$10,881
|
|
Shareholders Equity
|
$209,641
|
$193,435
|
$152,056
|
$158,984
|
|
Debt to Total Capital (1)
|
2.8%
|
3.7%
|
8.1%
|
6.8%
|
|
Common Share Data
|
||||
|
Diluted EPS -
Continuing Operations
|
$0.17
|
$(.78)
|
$(3.00)
|
$0.50
|
|
Diluted Average
Shares Outstanding
|
14,395
|
13,652
|
13,560
|
14,051
|
(1) Excludes employment and litigation settlements and impairment of Goodwill
ØWhere We Were
§ Protecting core business through
quality products and strong
customer relationships
quality products and strong
customer relationships
§ Gaining more content on existing
platforms by leveraging success
into integrated sub-system and
system work - “moving up the
food chain”
platforms by leveraging success
into integrated sub-system and
system work - “moving up the
food chain”
§ Evaluating acquisition
opportunities to target strategic
markets, programs, customers
and technologies
opportunities to target strategic
markets, programs, customers
and technologies
§ Aggressively pursuing new
business opportunities and new
programs
business opportunities and new
programs
§ Capitalizing on growth of
international militaries (e.g.,
India, South Korea, Turkey)
international militaries (e.g.,
India, South Korea, Turkey)
§ Long history of providing microwave
systems and components to
defense and commercial sectors
systems and components to
defense and commercial sectors
§ Settled all outstanding litigation,
including July 2010 settlement of
securities class action suits
including July 2010 settlement of
securities class action suits
§ New leadership team in 2009 and
2010
2010
§ Record financial performance in
2010, growing revenue to $188M
and adjusted EBITDA to $28.2M
2010, growing revenue to $188M
and adjusted EBITDA to $28.2M
§ Significant funded backlog of $187
million as of July 2010
million as of July 2010
§ Large number of single-source
positions on long-term and well-
funded defense programs
positions on long-term and well-
funded defense programs
ž Protect Our Core Business
ž Quality products and services
ž On-time delivery
ž Strong customer relationships
ž Gain More Content On Existing Platforms
ž Leverage success into higher level sub-system and system work - “move
up the food chain”
up the food chain”
ž Evaluate Acquisition Opportunities
ž Create synergies with existing companies
ž Target strategic markets, programs, technology, customers
|
Program / Platform
|
Description
|
|
P-8 Multi-Mission Maritime
Aircraft (MMA) |
n Next-generation maritime surveillance
aircraft to replace P-3 Orion |
|
Firefinder Radar System
Upgrade (EQ-36) |
n Mobile radar system designed to detect and
track incoming artillery and rocket fire |
|
Fire Scout UAV (MQ-8)
|
n Unmanned autonomous helicopter for ISR
and precision targeting support |
|
QF-16 Full Scale Aerial Target
|
n Reusable full-scale aerial target drone
modified from an F-16 |
|
Barak and Spyder Missiles
|
n Surface-to-air anti-aircraft missile systems in
use by foreign militaries |
|
Navy Sub-Scale Aerial Target
(SSAT BQM-167X) |
n Next-generation Naval unmanned aerial
target system |
|
Program / Platform
|
Description
|
|
Broad Area Maritime
Surveillance (BAMS) |
n UAS system for persistent maritime ISR data
collection and dissemination capability |
|
F-35 Joint Strike Fighter (JSF)
|
n Next-generation multirole fighter aircraft
|
|
Surface Electronic Warfare
Improvement Program (SEWIP) |
n Spiral-block program to provide improved
Fleet electronic warfare capability |
|
Joint Air-to-Ground Missile
(JAGM) |
n Next-generation air-to-surface missile to
replace current BGM-71 TOW, AGM-114 Hellfire and AGM-65 Maverick missiles |
|
Next Generation Jammer
(NGJ) |
n EW jammer pod intended for the EA-18G
Growler and F-35 Joint Strike Fighter |
|
Air and Missile Defense Radar
(AMDR) |
n Scalable solid-state radar suite intended for
future Naval surface combatants |
ž Approximately 34% of FY2010 Revenue was International
ž 1988 foreign sales were less than 1%
ž Growth in the international marketplace is a company goal
ž Facilities in Israel and the UK have expanded Herley’s
international reach
international reach
ž A strong backlog at EWST and Israel
ž An extensive network of knowledgeable sales representatives
around the globe
around the globe
ž Business development is being expanded in Taiwan, Japan,
Korea and India
Korea and India
ž Focused defense-technology company
ž Diversified portfolio of customers and programs
ž Strong customer relationships
ž Solid new business pipeline both domestic and international
ž Continued organic growth
ž Disciplined acquisition strategy
Market leader in microwave technology
v
State-of-the-art microwave design and production expertise
v
Highly experienced employees and management
v
Entrenched on mission-critical platforms with an established
and diversified customer base
and diversified customer base
Herley Industries, Inc.
3061 Industry Drive, Suite 200
Lancaster, PA 17603
Telephone: 717 397-2777
Fax: 717 735-8123
http://www.herley.com