EXFO Annual General Meeting - January 2015

Germain Lamonde
Chairman, President and CEO
January 8, 2015

2© 2015 EXFO Inc. All rights reserved..
Certain statements in this presentation, or given in response to your questions, may constitute
forward-looking statements within the meaning of the Securities Act of 1934. The Private
Securities Litigation Reform Act of 1995 provides “safe-harbors” for such forward-looking
statements and we intend that any forward-looking statements made today be subject to the
safe harbors. We caution you that any forward-looking statements are just predictions. They
are not guarantees of future performance and involve risks and uncertainties. Actual results
may differ materially from those projected in forward-looking statements and we invite you to
review the company’s most recent filings with the Securities and Exchange Commission or
Canadian securities commissions for a discussion of the factors at risk. These forward-looking
statements speak only as of the date of this presentation and, unless required by law or
applicable regulations, we will not be reviewing or updating the material that is contained
herein.
Annual financial data in this presentation is prepared in accordance with international financial
reporting standards (IFRS) and Canadian generally accepted accounting principles (GAAP).
Quarterly financial data is prepared in accordance with IFRS. For a reconciliation of adjusted
EBITDA to net earnings, refer to the Q1 2015 press release or the “Non-IFRS Measures”
section on EXFO’s website.
All amounts in millions of US dollars, except otherwise noted.
Forward-Looking Statements

FY 2014 Financial Highlights
› Sales: $230.8 M (-4.7% YoY)
› Reduced carrier spending in the Americas
› Merger activity (mostly in USA)
› Weighing major network changes
› Bookings: $240.4 M (+3.0% YoY)
› B/B ratio: 1.04 (0.96 in 2013)
› Replenished backlog in 2014
› Gross margin: 62.4% (61.8% in 2013)
›Raised gross margin for 8X in last 10 years
› Adjusted EBITDA*: $14.4 M (6.2% of sales)
›Reduced OPEX by $6.2 M
› Cash flows from operations: $19.8 M
* Adjusted EBITDA represents net earnings before interest, income taxes, depreciation and amortization,
stock-based compensation costs and foreign exchange gain.

Segmented Sales—FY 2014
PHYSICAL & PROTOCOL BOOKINGS UP 3.0% YoY
Sales down 6.3% and 1.2% for
Physical and Protocol lines in 2014
Weakness in the Americas in 2014
GEOGRAPHICAL SALES
FY 2014
PHYSICAL/PROTOCOL SALES

Technology Acquisitions
• SNMP polling
• Integrated into SA offering
• Unmatched end-to-end
visibility and scalability
ByteSphere
• CEM analytics
• Combined with wireless
probes
• End-to-end solution
Aito
Technologies

6© 2015 EXFO Inc. All rights reserved.
Key Contract Wins
• Tier-1 MNO (US)
• Optimize efficiency
• EXFO Connect
SERVICE
ASSURANCE
• Tier-1 MNO (Europe)
• Mobile backhaul
• Ethernet One solution
WIRELESS

Hardware to
Virtualized
Environments
Legacy to
Packet-based IP
Architectures
Fixed to Mobile
Networks
Major Shifts in Network Operator Spending

8© 2015 EXFO Inc. All rights reserved. 8© 2015 EXFO Inc. All rights reserved..
Growth Strategy
Top-line driven: Bolster sales and gross margin
INCREASE
Wireless presence. Bookings to
wireless customers reached 30-32%
of total bookings in FY 2014.
EVOLVE
Into a solutions supplier. End-to-
end solutions deliver higher margins.
ACCELERATE
Profitability. Combining revenue
growth with a tight control on costs.
EXPAND
Share of wallet with tier-1 network
operators. Top-15 operators
account for ~65% of total spending.

9© 2015 EXFO Inc. All rights reserved. 9© 2015 EXFO Inc. All rights reserved..
Transformation into Solutions Supplier
Enabling Network Operators to Cope with Real-World Challenges
› Five-plus years with Brix
Networks (SA solution)
› EXFO Connect represents
unique advantage
› Important wins in FY 2014
› Continuing journey with
ByteSphere and Aito
Technologies acquisitions
DEPLOY NEW
REVENUE–
GENERATING
SERVICES
INCREASE
NETWORK
CAPACITY
REDUCE
OPERATING
COSTS
IMPROVE
QUALITY OF
EXPERIENCE

Intelligent Platforms
Contextual AnalyticsEXFO Connect
Service & Network Assurance
Leveraging Key Assets

Management Priority
* Adjusted EBITDA represents net earnings before interest, income taxes, depreciation and amortization, stock-based compensation costs
and foreign exchange gain or loss.
MEDIUM-TERM PROFITABILITY TARGET

Q1 2015 Highlights
› Sales totaled $56.7 M (up YoY)
› Bookings reached $54.2 M (book-to-bill ratio of 0.96)
› Gross margin1 attained 62.6% (up YoY)
› IFRS net earnings totaled $1.5 M (up YoY)
› Adjusted EBITDA2 amounted to $3.2 M (Up YoY)
1Gross margin before depreciation and amortization is a non-IFRS measure and represents sales less cost of sales, excluding depreciation
and amortization.
2Adjusted EBITDA represents net earnings (loss) before interest, income taxes, depreciation and amortization, stock-based compensation costs
and foreign exchange gain.

Substantial Issuer Bid (SIB)
› Modified Dutch Auction of C$30 M
› Shares can be tendered between C$4.20 and C$4.60
› Or at lowest purchase price set by SIB
› EXFO will select lowest price that allows company to
purchase maximum number of shares
› Current share price does not reflect full value of business
› EXFO believes SIB is a good use of cash and creates
value for shareholders
› Offer expires on Feb. 13, 2015

Committed to Building Value
Growth Strategy
• Top-line driven
• Targeting market
share gains
• Not relying on
end-markets to
vastly improve
Cost Savings Share Buybacks
• $6.2 M in 2014
• $9.0 M in 2013
• Tight cost
controls in
effect
• SIB (C$30 M)
• NCIB ($0.9 M) in
Q1 2015
• Good use of
cash and
creates value

EXFO Annual General Meeting - January 2015

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