May 2010 AIVtech Investor Presentation
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May 2010 AIVtech Investor Presentation

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Company Description - AIVtech International Group Co. (“AIVtech” or the “Company”) is a leading manufacturer of consumer electronics ...

Company Description - AIVtech International Group Co. (“AIVtech” or the “Company”) is a leading manufacturer of consumer electronics
products, such as furniture audio and multimedia speakers in China. The Company plans to capitalize on its strong domestic position
to become a well-known international brand. AIVtech focuses on the integration of electronic devices, such as multimedia speakers, with
furniture and has coined the term “electronic furniture” to describe its products. The Company’s brand—AIV—stands for “Audio & Interactive
Video” and describes the integration of audio and video to provide complete audio-visual systems for its customers. Currently, the
Company classifies its products within three categories: (1) casual furniture audio such as rocking chair speakers and video game chairs;
(2) hi-fi digital and multimedia speakers; and (3) LCD/LED televisions, which entered into production in April 2010. The Company was
founded in October 2004 and is headquartered in Shenzhen, China, and its manufacturing facility is located in Dongguan.

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    May 2010 AIVtech Investor Presentation May 2010 AIVtech Investor Presentation Presentation Transcript

    • AIVtech International Group Co. Investor Presentation May 2010 1
    • Safe Harbor Statement Safe Harbor Statement for Purposes of the “Safe Harbor” Provisions of the Private Securities Litigation Reform Act of 1995: This presentation contains “forward-looking” statements, which are not historical facts, but are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to analyses and other information based on forecasts of future results and estimates of amounts not yet determinable. These statements also relate to our future prospects and proposed new products, services, developments or business strategies. These forward- looking statements are identified by their use of terms and phrases such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “intend”, “may”, “plan”, “predict”, “project”, “will”, “continue” and other similar terms and phrases, including references to assumptions. Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to changes and to inherent known and unknown risks and uncertainties. We do not intend, and undertake no obligation, to update our forward-looking statements to reflect future events or circumstances. 2
    • Equity Snapshot Symbol OTCBB:ECOH Price / 52-Week Range $4.60 / N/A Basic Shares Outstanding 20 million Market Cap. $92 million Revenues (CY09) $38.5 million EBITDA (CY09) $8.3 million EPS (CY09) $0.37 EV/Sales (CY09) N/A Cash (12/31/09) $3.6 million Total Debt (12/31/09) $0 Fiscal Year End December 3
    • Investment Highlights Leading consumer electronics manufacturer with strong brand Innovative product design Proprietary technology and intellectual property New LED TVs to drive growth in 2010 Rapid growth in revenue and net income Experienced management team 4
    • Company Overview Leading audio furniture, multimedia speaker and LED-TV manufacturer with a strong brand name Founded in 2004 and headquartered in Shenzhen Products sold in North America, Europe, Southeast Asia, Australia and China 30,000 sq. m of manufacturing space located in Dongguan 600+ employees 5
    • Product Overview Audio Furniture Multimedia Speakers (80% of CY09 Sales) (20% of CY09 Sales) LED/LCD TVs (Launched in 2010) 6
    • AIV-Branded Audio Furniture Leading brand with approximately 60% share of international market Generated 80% of revenue in 2009 Award-winning video-game chair Works with PS, Xbox 26% gross and 18% net margins 7
    • Avid China Gaming Market Number of Internet Users and Growth Avid gaming market in China Rate in China 384 million Internet users and 450 80% 170,000+ Internet cafes 400 70% China ranks #2 with 27% of 350 60% global network gaming revenue (Iresearch) 300 50% (Millions) (Percent) Chinese online game market to 250 hit $9.2 billion by 2014 (Niko 40% 200 Partners) 30% 150 Market for online games 100 20% expected to grow by 11% through 2013 (yStats.com) 50 10% U.S. growth rate: 29% 0 2002 0% 2003 2004 2005 2006 2007 2008 2009 China: 21% Number of Internet Users Growth Rate Source: China Internet Network Information Center (CINIC) 8
    • Multimedia Speakers Broad product line Notebook PC speakers Channel speakers Wireless speaker kit Generated 20% of revenue in 2009 24% gross and 16% net margins Hot new product: Digi Panda 9
    • Multimedia Industry Outlook Global market for multimedia speakers is forecast to hit 127.3 million units and $2.9 billion in 2010, growing 10% in 2011 (HZResearch) The Chinese market for multimedia speakers is forecasted to hit 26.9 million units and $615.8 million (HZResearch) Steady growth of multimedia speaker sales in China. Expect to gain higher market share in 2010 with fast-selling Digi Panda 10
    • LCD/LED TV Opportunity Global LCD TV market 171 M Worldwide TV Market by Technology units in 2010 (+21%) (Corning) The China LCD TV market is expected to hit 37 million units (+32%) LCD TV penetration is expected to increase by 18 points to 86% in China Rapid increase in LED- Backlit TVs (DisplaySearch) 35 million units (20% penetration) sold in 2010 100 million units (40%) Source: DisplaySearch via Semiconductor Today estimated to be sold in 2013 11
    • LED-Backlit Televisions New LED-TV line for 2010 LED TVs offer superior lifetime and image quality Professional and powerful build-in audio technique Excellent design team in digital circuits and industrial design Established customer relationships with many well-known European brands such as ALDI , Dixons, Qmedia, etc. Expect significant revenue contribution in 2010 Offers 15% gross and 6% net margins 12
    • Sales Channel LED TV and Furniture Audio businesses are 100% ODM CY 09 Sales by Distributor Multimedia speaker business is 50% ODM Others International retailers (80% of total 16.3% 16.3% sales): Ace Bayou, Target, TC-STAR, and Wal-Mart Anji Weiyu 4.1% 4.1% Beijing Huaqi 7.7% 7.7% 47.3% 47.3% 10.2% Guangdong 10.2% Guanghong Da Kang Domestic distributors (20% of total 14.5% 14.5% sales): Dakang Holding, Anji Chaoya, Anji Weiyu, Beijing Huaqi, and Anji Chaoya Guangdong Guanghong 13
    • Proprietary Technology Several patents awarded and hundreds of international product certifications Innovative and unique patented products Digital speaker with audio and video function Multimedia furniture chair with audio Core technology includes: Integrating multimedia digital products and furniture “Seat-back linkage” in the under-bed of an intelligent chair Key technology and application of a digital family doctor 14
    • Disciplined Manufacturing Manufacturing facility located in Dongguan, Guangdong Province Strict production management Forecast of annual production capacity of furniture audio, multimedia speakers, and LED TVs (in 2010, post-financing): 1.8 million, 1.2 million, and 1.2 million units, respectively Fast response time Existing products: 12-18 days New products: ready for shipment in 15-21 days 15
    • Awards and Certifications Awards and certifications include: ISO9001: 2000 China Compulsory Certification (3C) South Korea electrical and electronic research institute Hong Kong standards and testing product certification European Union CE certification State FCC certification 16
    • Competitive Advantages Established, stable distribution channels such as Ace Channel Bayou, Carrefour, Target, Wal-Mart, and TC-STAR, etc. More than 60 domestic distributors nationwide Transportation Close proximity to waterways and railways Several patents and hundreds of international product Technology certifications in multimedia speaker and furniture audio, as well as LED technology Team Experienced R&D and aggressive management team Well-known brand in domestic and global market for Brand producing high quality, innovative products 17
    • Growth Strategy LED TVs Entered rapidly growing market for LCD TVs with LED backlighting Leverage strong brand name and sales and distribution network Audio Furniture Introducing new exciting and unique products in international markets Further penetrate China, Australia, United States and Southeast Asia: huge market potential Multimedia / Digital Speakers Design, develop and produce innovative products such as the Digi Panda to attract new customers and gain share 18
    • Management Team Name Position Background Founder, professional engineer, Chairman and Mr. Jinlin Guo many years of design CEO experience Professional advanced engineer, Mr. Xiaoyou Luo Vice Manager many years of design and project management experience Former controller at Malata Mr. Wenfeng He COO group and of Shenzhen Wei Zhi group Many years experience as Mr. Yilin Shi CFO financial manager and controller 19
    • Strong Revenue Growth $45 $40 $38.5 $35 Revenue ($ millions) R C AG $30 % 64 $25 $20.7 $19.1 $20 GR CA $14.4 $15 %0 39 $10 $5 $3.9 $0 2007(*) 2008 2009 3mo ended 3mo ended 03/31/09 03/31/10 (**) * 2007 figures are unaudited * Q1 2010 figures are unaudited 20
    • Strong Net Income Growth $8.0 $7.5 $7.0 Net Income ($ millions) $6.0 R C AG $5.0 7 % 10 $3.9 $3.8 $4.0 GR $3.0 CA $1.8 0% $2.0 66 $1.0 $0.5 $0.0 2007(*) 2008 2009 3mo ended 3mo ended 03/31/09 03/31/10 (**) * 2007 figures are unaudited * Q1 2010 figures are unaudited 21
    • Income Statement Highlights CONSOLIDATED INCOME STATEMENT Three Months Ended Year Ended March 31, December 31, ($ in Millions) 2010 2009 2009 2008 Sales, net $19.1 $3.9 $38.5 $20.7 Cost of sales 14.0 2.8 28.1 15.1 Gross profit 5.1 1.0 10.4 5.6 Selling, general and administrative expenses 0.7 0.4 2.1 1.7 Income from operations 4.4 0.6 8.3 3.9 Other income/(expenses) 0.0 1.6 0.0 0.0 Profit before income tax 4.4 0.6 8.3 3.9 Income taxes 0.5 0.1 (0.8) 0.0 Net income before minority interest 3.9 0.5 0.0 0.0 Minority interest 0.1 0.0 0.0 0.0 Net income 3.8 0.5 7.5 3.9 Net income per share $0.19 $0.03 $0.37 $0.21 22
    • Balance Sheet Highlights CONSOLIDATED BALANCE SHEET ($ Millions) March 31, 2010 December 31, 2010 Cash and cash equivalents $3.6 $3.6 Other current assets 22.0 7.2 Non-current assets 1.0 1.0 Total assets 26.6 11.8 Current liabilities 21.5 10.5 Total liabilities and shareholders’ equity 26.6 11.8 23
    • Investment Highlights Leading consumer electronics manufacturer with strong brand Innovative product design Proprietary technology and intellectual property New LCD TVs to drive growth in 2010 Rapid growth in revenue and net income Experienced management team 24
    • Contact Information Company Contact: Investor Relations Firm: AIVtech International Group Co. CCG Investor Relations Mr. Teli Liao, VP/Secretary of the Board John Harmon, CFA, Sr. Account Manager Tel: +86-755-2533-3022 Tel: +1-646-833-3424 Cell: +86-135-1052-0564 Email: john.harmon@ccgir.com Email: terryliao@aivtechgroup.com Website: www.aivtechgroup.com Auditor: Counsel: Acquavella, Chiarelli, Shuster, Anslow & Jaclin LLP Berkower & Co., LLP 1350 Avenue of the Americas, 3rd Floor 1 Penn Plaza, 36th Floor New York, NY 10019 New York, NY 10119 25
    • Thank You!