Annual Needham Growth Conference


Published on

Published in: Investor Relations, Business
  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Annual Needham Growth Conference

  1. 1. 14th Annual Needham Growth ConferenceJanuary 11, 2012Jim Skippen, Chairman & CEO
  2. 2. SAFE HARBOURThis presentation may include predictions, estimates or other information relating to Wi-LAN Inc and its affiliates thatmight be considered forward-looking, including statements constituting “forward-looking statements” or “forward-lookinginformation” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and other UnitedStates and Canadian laws. These forward-looking statements and forward-looking information are based upon current g g pexpectations and assumptions regarding anticipated developments and other factors affecting Wi-LAN Inc. and itsaffiliates. They are not historical facts, nor are they guarantees of future performance. Because these forward-lookingstatements and forward-looking information involve risks and uncertainties, there are important factors that could causeactual results to differ materially from those expressed or implied by these forward-looking statements and forward-looking information. There can be no assurance that any forward-looking statements and forward-looking informationcontained i thi d t i d in this document will prove t b accurate. A t l results and f t t ill to be t Actual lt d future events could diff materially f t ld differ t i ll from th thoseanticipated in such statements.These and all subsequent written and oral statements containing forward-looking statements and forward-lookinginformation are based on the estimates and opinions of management on the dates they are made and expresslyqualified in their entirety by this notice Except as required by applicable laws Wi-LAN Inc. assumes no obligation to notice. laws, Incupdate forward-looking statements should circumstances or managements estimates or opinions change. Readers arecautioned not to place undue reliance on any statements of forward-looking information that speak only as of the dateof this presentation. Additional information identifying risks and uncertainties relating to Wi-LAN Inc.’s business arecontained under the heading “Risk Factors” in Wi-LAN Inc.’s August 3, 2011 Management’s Discussion and Analysisand its other filings with the various Canadian securities regulators which are available online at and g gwith the U.S. Securities and Exchange Commission available at Throughout today’s presentation, we willattempt to present some important factors relating to our business that may affect our predictions. You should alsoreview our SEDAR and SEC filings for a more complete discussion of our risk factors.Unless otherwise noted, all dollar amounts are in U.S. currency. TSX:WIN / NASD:WILN 2
  3. 3. PATENTS AS AN ASSET CLASS• Growing awareness of the value of patents July 2, 2011, Wall Street Journal August 15, 2011, National Post• C Companies exploring h i l i how t unlock value to l k l July 21, 2011, Wall Street Journal July 19, 2011, Reuters TSX:WIN / NASD:WILN 3
  4. 4. ABOUT WiLAN • US $730M market capitalization (Jan. 6, 2012) • Revenues: licensing large patent portfolio • Established business model Annual Revenues Qualcomm IBM InterDigital Tessera $4B $2B $300M $300M Rambus Acacia WiLAN RPX $300M $130M $105M* $100M* Fiscal 2011 financial guidance in US$ TSX:WIN / NASD:WILN 4
  5. 5. WORLD CLASS TEAM – LEADERSHIP Jim Skippen • 25 years licensing, $1B patent licensing CEO • Mosaid, Borden Elliot Shaun McEwan • 20 years financial and executive leadership CFO • Breconridge, Calian Paul Lerner • 25 years IP law and licensing Senior Legal Counsel • GPC, Black & Decker, ABB Andrew Parolin • 17 years engineering, marketing and licensing SVP Licensing • SIGE Semiconductor, Nortel Daniel Henry • 15 years IP business and litigationVP Business Development • ICAP Altitude Capital Baker Botts ICAP, Capital, Matt Pasulka • 14 years corporate and IP law VP Patent Litigation • AGA Medical, Sikorsky Aircraft, Martin Marietta Rob Scott • 15 years international patent lawVP Patent Administration • Registered U.S. Patent Attorney Christian Dubuc • 15 years engineering, marketing and licensingVP Licensing Technologies • Nortel, Communications Research Centre TSX:WIN / NASD:WILN 5
  6. 6. WORLD CLASS TEAM – MULTIPLE DISCIPLINES Education and Designations* Engineers 32 Masters/PhDs 27 Lawyers 9 MBAs 2 Patent Agents 6 Accountants 2 • 55 employees, highest revenue/employee of any Canadian public high-tech company ($2M+)* Indicates # of employees with given education/designation not # of employees serving in specific role, at October 25, 2011 TSX:WIN / NASD:WILN 6
  7. 7. GROWING & DIVERSE PATENT PORTFOLIO 3000 Technology Patents Patents* Wireless Communication 1000+ 970 Wireline Communication 300+ 750 280 300 Digital TV & Display 1500+ 20 Other 200 2006 2007 2008 2009 2010 2011* Issued and pending patents TSX:WIN / NASD:WILN 7
  8. 8. LICENSING EXCELLENCE• Over 250 companies licensed• Major litigations settled in early 2011 • Signed license agreements worth 100s of $M • WiLAN h d has demonstrated it can use liti ti t t t d litigation to enforce its rights TSX:WIN / NASD:WILN 8
  9. 9. STRONG REVENUE GROWTH 30%+ Annual Cash Revenue $105M* Growth $ 50.7M $ 35.4M $ 26.6M $19.2 M+ $ 2.1M 2006 2007 2008 2009 2010 2011+ Cash revenues* Fiscal 2011 financial guidance in US$ TSX:WIN / NASD:WILN 9
  10. 10. POSITIVE EARNINGS Dramatic earnings+ growth in 2011 due to litigation settlements $70M* $9M $4.8M $2.5M $2 5M $5M ($1.4M!) ($5.9M) ($23.9M) 2004 2005 2006 2007 2008 2009 2010 2011! Continuing operations* Fiscal 2011 financial guidance in US$+ Adjusted Earnings are earnings from continuing operations before stock-based compensation expense, depreciation & amortization expense, interest expense, unrealized foreign exchangegains or losses, provision for income taxes and certain other non-cash, one-time, or non-recurring charges. TSX:WIN / NASD:WILN 10
  11. 11. STRONG FINANCIAL POSITION Net cash* $ 197 M Long-term debt+ Long term $0 Deferred tax asset $25 M Listed on NASDAQ Global Select Market Annual dividend CDN $0.10 All figures in $US unless otherwise indicated* At September 30, 2011+ Excludes net proceeds from convertible debenture scheduled to be repaid 01/31/12 which was listed as long-term debt in Wi-LAN Inc. 2011 Third Quarter Consolidated Financial Results Interim Report TSX:WIN / NASD:WILN 11
  12. 12. WILAN HAS JUST BEGUN – FIVE YEAR STRATEGY• Increase revenue to $200M+ • Current programs • Gladios IP – licensing partnerships • New programs (acquisitions, R&D) (acquisitions TSX:WIN / NASD:WILN 12
  13. 13. WILAN HAS JUST BEGUN – FIVE YEAR STRATEGY• Deliver strong earnings while investing in: • Enforcement • Portfolio growth • Operations and team • Research and development • Licensing programs and capability TSX:WIN / NASD:WILN 13
  14. 14. REVENUE DRIVERS - CURRENT PROGRAMS Today Future 2010 Device Sales: 2014 Device Sales: 2010 Device Sales: Over $100B (WW) Over $25B (WW) Over $140B (WW) 3G 2010 Device Sales: 2010 Device Sales: Over $26B (NA) Over $100B (WW) Incremental Revenue Opportunity: $700M to $1.3B*Sources: Display Search, Dell’Oro, Strategy Analytics, IDC, WiLAN* Estimate considers unit volumes of infringing products, wholesale value of infringing products, fair royalty rates, remaining patent lives. Not an estimate of potential annual revenues TSX:WIN / NASD:WILN 14
  15. 15. REVENUE DRIVERS - LICENSE OPPORTUNITIESNew Licenses Products Renewed/Expanded Licenses Products Cellular infrastructure Digital televisions g Cellular handsets Cellular handsets Cellular handsets Cellular infrastructure Cellular handsets Cellular handsets Digital televisions Cellular handsets Cellular handsets DSL infrastructure Digital televisions TSX:WIN / NASD:WILN 15
  16. 16. SIGNIFICANT LITIGATIONSTechnology Devices Remaining Agreements Phase Timeline Defendants / Settlements 2011 2012 2013 2014 - SummaryV-Chip DTV LG Judgment (Expected June 2012)3GPP Cellular Alcatel-Lucent, LG Discovery Base Ericsson, Sony Ericsson, (April 8, 2013) Stations HTCWi-Fi, CDMA Cellular Apple, Initial Handsets Alcatel-Lucent, Pleadings (March 10, 2014) Dell, HP, HTC, Kyocera, Novatel Wireless Wireless, Sierra Wireless TSX:WIN / NASD:WILN 16
  17. 17. REVENUE DRIVERS – GLADIOS IP• WiLAN subsidiary• Partnerships to generate additional revenue with limited risk and investment• S partnerships to date Six Remote Access Internet Advertising On-line Gambling Networking Technology On-line Gaming Internet Connectivity TSX:WIN / NASD:WILN 17
  18. 18. NEW PROGRAMS - PATENT ACQUISITIONS• Significant financial resources on hand – $190M+• Proven ability to acquire undervalued assets DOCSIS patent Bluetooth patents Wireless patents TSX:WIN / NASD:WILN 18
  20. 20. RESEARCH AND DEVELOPMENT• R&D drives future revenue prospects and business opportunities• Next generation wireless technology • Spectrum sensing in Whitespace • LTE in picocell networks TSX:WIN / NASD:WILN 20
  21. 21. Q3 2011 – HIGHLIGHTS • Revenue of $27.8M, up 147% year-over-year • Adjusted earnings* of $22.8M, compared to $0.9M in Q3 2010 • Quarterly dividend of CDN $0.025 per share* Adjusted Earnings are earnings from continuing operations before stock-based compensation expense, depreciation & amortization expense, interest expense, unrealized foreign exchangegains or losses, provision for income taxes and certain other non-cash, one-time, or non-recurring charges. TSX:WIN / NASD:WILN 21
  22. 22. ANALYST COVERAGE All analysts have buy recommendations Analyst Rating Target Byron Capital Markets Buy CDN$7 Canaccord G C d Genuity it Buy B CDN$10 Craig-Hallum Capital Buy $15 CIBC Sector Outperform CDN$10 Davenport & Co Buy $11 Fraser Mackenzie Strong Buy CDN$14 Northland Capital Sector Outperform CDN$11 Paradigm Capital Buy CDN$11 Versant Partners Buy CDN$8.40 CDN$8 40 TSX:WIN / NASD:WILN 22
  23. 23. CONCLUSION• Significant value generated over last five years• Just beginning to realize business potential• Five year growth strategy to drive long-term and sustained increase in shareholder value VALUE GROWTH TSX:WIN / NASD:WILN 23