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Spectrum investor presentation nov 2018

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Spectrum Global Solutions (OTC: SGSI)

Spectrum Global Solutions operates through its subsidiaries AW Solutions and ADEX Corp. The Company is a leading provider of telecommunications engineering and infrastructure services across the United States, Canada, Puerto Rico, Guam and Caribbean. For more information about the company and its technologies, visit www.sgsiinfo.com for more information.

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Spectrum investor presentation nov 2018

  1. 1. Carriers, consumers and enterprises will spend ~$1.5 trillion on telecommunications services. LISTED SGSI NOVEMBER 2018 INVESTOR PRESENTATION © 2018, Spectrum Global Solutions, All Rights Reserved telecolead.com, February 2018
  2. 2. This presentation contains forward-looking statements. The statements contained in this presentation that are not statements of historical fact, including but not limited to, statements identified by the use of terms such as "anticipate," "appear," "believe," "could," "estimate,“ "expect," "hope," "indicate," "intend," "likely," "may," "might," "plan," "potential," "project," "seek,“ "should," "will," "would," and other variations or negative expressions of these terms, including statements related to expected market trends and the Company's performance, are all "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and involve a number of risks and uncertainties. These statements are based on assumptions that management believes are reasonable based on currently available information, and include statements regarding the intent, belief or current expectations of the Company and its management. Prospective investors are cautioned that any such forward looking statements are not guarantees of future performances, and are subject to a wide range of external factors, uncertainties, business risks, and other risks identified in filings made by the company with the Securities and Exchange Commission. Actual results may differ materially from those indicated by such forward-looking statements. The Company expressly disclaims any obligation or undertaking to update or revise any forward-looking statement contained herein to reflect any change in the company's expectations with regard thereto or any change in events, conditions or circumstances upon which any statement is based except as required by applicable law and regulations. FORWARD LOOKING STATEMENTS 2LISTED SGSI
  3. 3. The 5G rollout will create 3 million American jobs and drive over $500 billion U.S. GDP growth. 1991 1998 2008 2020 0.1 Mb/s 1.0 Mb/s 15 Mb/s 1.4 Gb/s WE ENGINEER, UPGRADE, INSTALL AND MAINTAIN NEXT-GENERATION TELECOMMICATION NETWORKS 3LISTED SGSI
  4. 4.  We are a comprehensive, single-source provider for the development, deployment and maintenance of network infrastructure  Our Services range in scope from a single activity, to multi-year, multi-region large scale turnkey development contracts  Our experience encompasses national/international programs worth over $1.5 billion, management of 1500+ staff  We are professionally registered in 49 States, 3 US territories (Puerto Rico, USVI, Guam), 6 Canadian Provinces in support of our clients. ABOUT SPECTRUM GLOBAL Spectrum Global Solutions have successfully executed on projects across the United States and internationally. We provide cost-effective, scalable and robust solutions for communication carriers, utilities, enterprise clientele, OEMs and professional service companies. 4LISTED SGSI COMPANY HISTORY Feb 2017 ACQUISITIONS :AW Solutions Inc., AW Solutions Puerto Rico LLC. and Tropical Communications Inc. (Formed respectively 2006, 2011 & 1984) Jan 2007 FORMATION Mantra Venture Group Formed Dec 2017 RENAMING Spectrum Global Solutions, Inc. Feb 2018 ACQUISITIONS : ADEX Corporation and ADEX Puerto Rico LLC (Formed respectively 1993 & 2008)
  5. 5. LAYING FIBER Connecting metro and local areas, telecom sites and facilities with new and upgraded fiber CONSTRUCTING NEW SITES Working as the local contractor for new site design, construction and installation INSTALLING & CONNECTING LOCATIONS Delivering new network infrastructure ENABLING NETWORKS ONE OF THE FEW ELITE, NATIONWIDE, FULL-SERVICE ENGINEERING, CONSTRUCTION, INSTALLATION, MAINTENANCE AND PROFESSIONAL SERVICE FIRMS 5LISTED SGSI LONG HAUL AND LOCAL FIBER TO METRO LOCATIONS COMMISSIONING CELL TOWERS AND SMALL CELLS LAST MILE CONNECTIONS TO LOCAL NODES ENABLING PRIVATE NETWORKS
  6. 6. CARRIERS AGGREGATORS ORIGINAL EQUIPMENT MANUFACTURERS UTILITIES PROJECT MANGEMENT ORGANIZATIONS (PMOs) OUR CUSTOMERS THE LARGEST AND MOST RESPECTED COMPANIES IN THE INDUSTRY 6LISTED SGSI ENTERPRISE/GOVERNMENT
  7. 7. ROGER PONDER CEO & Director Mr. Ponder has served as a director of the Company since April 2017. Mr. Ponder has been the President and Chief Executive Officer of Summit Broadband LLC, and Summit Capital Advisors, LLC, a provider of consulting services to private equity and institutional banking entities in the telecommunications, cable and media/internet sectors since August 2009. Mr. Ponder has served as a member of the board of directors of InterCloud Systems, Inc., and served as its Chief Operating Officer from November 2012 to March 2015.. From January 2005 to August 2009, he was the President - Midwest/Kansas City Division of Time Warner Cable. Mr. Ponder was a member of the United Way Board of Trustees - Kansas City from January 2006 to January 2011. Mr. Ponder started his telecommunications career with Winter Park Telephone in 1972 and after many successful years retired from Time Warner as President/CEO of Time Warner Cable-Kansas City Division in 2009. Mr. Ponder has held many senior executive leadership positions in the telecommunications, broadband and entertainment industry with Time Warner, Sprint and United/Sprint Management Company. During his career he also held the positions of President of Oceanic Communications/TWC Hawaii and prior to that Vice President Business & Strategic Planning, Time Warner Telecom in Denver Mr. Ponder received his B.S. from Rollins College in Business Administration and Economics. Mr. Ponder brings extensive business development, strategic planning and operational experience to the Company. INDUSTRY EXPEIENCE PUBLIC MARKETS CUSTOMER RELATIONSHIPS 45 YEARS YES INDUSTRY EXPEIENCE PUBLIC MARKETS CUSTOMER RELATIONSHIPS 40 YEARS YES MANAGEMENT 7LISTED SGSI KEITH HAYTER President & Director Mr. Hayter has served as a director of the Company since April 2017. Mr. Hayter also served as the Chief Executive Officer and President of AW Solutions Inc. and AW Solutions Puerto Rico LLC since November 2006. Mr. Hayter has been the Vice President and General Manager of Alcoa Wireless Services from November 2001 to November 2006. Mr. Hayter has been the Principle and Vice President of Pacific 17 from April 1997 to November 2001. Mr. Hayter has been the Vice President of Kercheval Engineers April 1993 to April 1997. Mr. Hayter also served in both the US and British armies. Mr. Hayter has held many senior executive leadership positions in the telecommunications and broadband industry. Mr. Hayter has over 40 years of international and national industry expertise in operations, business development, operational financial management, sales/marketing and business start-ups, business integrations, mergers, acquisitions and divestitures, managing businesses with headcounts of over 450 personnel in multiple service locations generating revenues of over $120 million a year. Mr. Hayter brings extensive multi- national experience in the start-up, development, management and growth of companies in the telecommunication, engineering and construction industry. 42% INSIDE OWNERSHIP
  8. 8.  PROVEN OPERATOR IN THE HIGH-GROWTH telecom infrastructure and Enterprise Solutions market  ONE OF THE FEW ENGINEERING, PROFESSIONAL SERVICE AND INSTALLATION COMPANIES able to provide a full suite of telecom and enterprise services and the ability to bundle its services for telcos, all delivered by highly-experienced engineering teams  PROVEN TRACK RECORD with top-tier Fortune 1,000 companies worldwide  REPLICABLE, SCALABLE SERVICES MODEL supported by industry-recognized strategic partnerships  EMBEDDED CUSTOMER RELATIONSHIPS FOSTER REPEAT CUSTOMERS at minimal customer acquisition costs  PROFESSIONALLY REGISTERED IN 49 STATES, 3 US TERRITORIES (PUERTO RICO, USVI, GUAM) AND 6 CANADIAN PROVINCES  INTERNATIONAL EXPERIENCE IN ASIA AND CENTRAL AND SOUTH AMERICA  PROVEN, EXPERIENCED MANAGEMENT TEAM with extensive industry, sector and public market experience INVESTMENT HIGHLIGHTSGROWTH COMPANY  HIGH-GROWTH MARKETS  SEASONED TEAM  UNIQUE SERVICES 8LISTED SGSI
  9. 9. TELCOS’ RACE TO GIVE CUSTOMERS MORE SPEED, BANDWIDTH AND FUNCTIONALITY CREATES A GROWTH SECTOR FOR ENGINEERING & INSTALLATION FIRMS 9LISTED SGSI
  10. 10. 3,076 4,384 5,980 8,274 12,042 17,457 2018 2019 2020 2021 2022 2023 US MOBILE DATA GROWTH – 4x (‘000 of Terabytes) INCREASED WIRELESS COVERAGE  5G, 300,000 new sites  FirstNet, 20,000 –40,000 new sites nationwide  Dish Network, 30,000 –50,000 new sites  FCC to auction new Spectrum for carriers / services  4G Maintenance and upgrades of 190,000 sites  Small cell deployments - 849,000 new sites  IOT & BYOD technology explosion  Enterprise & Private new networks 5G is really where the world's going. We are about 5G and building out the next layer of connected consumers. INCREASED FIBER CONNECTIONS  $130.0 B to $150.0 B in new fiber investment 5-7 years (Deloitte) Ericsson Traffic Exploration, 2018 Tim Armstrong, CEO, OATH, a Verizon Subsidiary June 8, 2018 – CNBC Interview Excerpt GROWTH DRIVES SPEND OUR MARKET IS IN GROWTH MODE 10LISTED SGSI US CARRIER CAPEX SPENDING ($US Billions) $50.2 $51.8 $53.4 $55.2 $57.0 2017 2018 2019 2020 2021
  11. 11. 1. RULE CHANGE: Contractors must now bundle services, respond more timely, and provide seamless delivery of multilocation projects. Michael O'Mara, CEO, NTA CRITERIA REVIEW Years Operational Nationally-Licensed Engineers on Staff No. of Active MSAs Range of Services OEM Expertise METRIC  10+ Customer and 2/3/4G experience  PREFERRED Ability to service multiple states  DEDICATED Benefit to inhouse vs. sub- contracting  50+ Recognized performance  FULL Ability To provide comprehensive services through one company.  YES 2. Telcos expectations for contract award have increased 11LISTED SGSI INSTALLATION DEMAND SPIKES, BUT SUPPLY OF QUALIFIED FIRMS IS LOW A MARKET TREND WE CAN LEVERAGE 3. Previous sector contraction, plus current firms’ inability to meet service standards are creating attractive acquisition opportunities. ENABLING ~$150B IN TELECOM CAPEX UPGRADES PLANNED THRU 2023
  12. 12. WE ARE TRUSTED AND QUALIFIED TO BUILD AND SERVICE END-TO-END COMMUNICATION NETWORKSSERVICES PROJECT MANAGEMENT RF DESIGN ASSET AUDIT / REVIEW R.O.W / R.O.E LEASING/ACQUISITION  ZONING REGULATORY COMPLIANCE ENVIRONMENT  GEOTECHNICAL STUDIES 12LISTED SGSI North American enterprises are forecast to deploy a total of 400,000 small cells during 2018, up compared to 292,000 the previous year. Small Cell Forum, 2018 DRONE SERVICES / STRUCTURAL MAPPING ENGINEERING  CIVIL  STRUCTURAL  ELECTRICAL PERMITTING CONSTRUCTION MANAGEMENT / INSPECTION CONSTRUCTION (OSP / ISP) INSTALLATION / TECHNICAL SERVICES WAREHOUSING, PROCUREMENT & LOGISTICS STAFFING SOLUTIONS MAINTENANCE & DECOMMISSIONING
  13. 13. 13 13SGSI 1313LISTED SGSI CASE STUDY #1 CASE STUDY #2 Client: Tier 1 National Carriers Project Locations: Alabama, California, Florida, Louisiana, Mississippi, New Mexico, Texas Project Details: Deployment of over 450 fully equipped copper and fiber splicers, installation and repair technicians, T-40 line crews, engineers and other personnel to repair and restore voice and data telecommunications networks and cabling after natural disaster events Client Benefits: Cost effective, single source, multi-region, rapid response and resource sustainable full service vendor Revenue Value: $80 million Emergency Telecommunications Restoration Services Client: Tier 1 National Infrastructure Aggregator Project Locations: US, Puerto Rico, USVI Project Details: Site Acquisition/Zoning, A&E Design, Structural Engineering, Asset Audits, Permitting, Construction Management/Inspection, Construction, Modifications, Installations, Logistics and Procurement for the development and Installation of macro sites, small cells and fiber optic networks. Client Benefits: Cost effective, single source, multi-region, discrete and turnkey vendor for full service offerings Revenue Value: $43 million Infrastructure Development Services
  14. 14. OUR FAST GROWTH IS DUE TO CLIENTS WHO FOUND VALUE IN OUR.. NOW, SEE HOW WE GROW EVEN MORE  WE CREDIT OUR GROWTH TO OUR.. SEE SELECT PROJECTS AND OUR GROWTH PLANS 14LISTED SGSI
  15. 15. OUR TRACK RECORDUnparalleled Industry and Professional Staff Experience  PROJECTS COMPLETED – 150,000+ National & International  STAFFING SOLUTIONS – 138,000+ Personnel Database  SITES ENGINEERED – 70,000+ National & International  SITES CONSTRUCTED/INSTALLED – 8,500+ Towers, Antennas, Small Cells, Facilities  FIBER AUDITED – 3,456,000 Strand Miles  FIBER INSTALLED – 586,944 Strand Miles  SAFETY RECORD - 100% Accident Free Zero lost work days, Zero Incidents  CLIENT RE-ENGAGEMENTS - 98%+ 15LISTED SGSI
  16. 16. Through our sector research and industry relationships we have identified multiple companies who meet our acquisition criteria and can be immediately accretive to earnings. We look for… CRITERIA  Synergistic Strategic Value  Accretive to Earnings & Growth  History of Profitability  Strong Management/Retention  Long Term Customer Relationships  Sufficient Size to Add Scale CONSIDERATIONS  Clean (No Issues)  Ease of Acquisition  Speed of Acquisition  Cost : Value and return to shareholders  Ease of Integration  Geographic Location/Overlap  New Clients  New Business Lines  Established and reputable wireless and wireline companies  Servicing carrier, enterprise, government, utilities and OEM’s  Strong management teams and controls  Profitable  Structured for growth  Excellent client relations/retention  Private or public, clean companies STRATEGIC AND TACTICAL ACQUISTIONS GROWTH OPPORTUNITY #1 16LISTED SGSI SPECTRUM REVENUE PROJECTIONS POST-ACQUISITIONS ($USD Millions) $10.7 $11.5 $12.0 $13.5 $22.0 $23.0 $26.0 $6.0 $7.5 $16.0 2017 Actual 2018 Forecasted 2018 Projected 2019 Projected SGSI ADEX Acquisition 2 Acquisition 3 $41.0 P $31.5 F $63.0 P
  17. 17. 1. Focus sales team at new service provider targets The inability of competitors to meet the recent increase in service provider criteria puts us in an advantageous position to win more contracts GROW MARKETSHARE AND LEVERAGE ORGANIC REVENUE AND MARGIN GROWTH While assessing highly-accretive acquisition opportunities, we will close on organic market opportunities to grow our current streams of infrastructure and staffing service revenues. We will…. GROWTH OPPORTUNITY #2 2. Expand corporate margins The low number of qualified services firms in the expanding market is raising fee pressures on competing carriers for our in-demand services. Also, the bundling of services boosts revenues and margin potential on projects 3. Execute new OEM and PMO partnerships New market entrants create expanded opportunities for our comprehensive suite of services. Targeting companies in the sector that SGSI has not marketed to or penetrated to-date. 4. Expand and deepen relationships with current clients Expansion of service footprint and new services allows SGSI to provide a deeper and wider breadth of services fulfilling more in-demand deployment service needs over a longer period of time. 5. Execute on coordinated sales strategy Leverage operating subsidiaries clients, services and relationships to maximize cross-selling opportunities 17LISTED SGSI
  18. 18. PERFORMANCE METRICS & FINANCIAL REVIEW PROJECTS TO DATE 150,000 + 2018 REVENUE FORECAST $32 M 2018 9 MONTH REVENUE GROWTH 543 % TRADING AS % OF SALES 7.5 % 18LISTED SGSI LISTED SGSI INDUSTRY:TELECOMMUNICATIONS $2.4 M MARKET CAP $0.33 SHAREPRICE 42% INSIDE OWNERSHIP
  19. 19. $0.1 $10.7 $32.0 2016 2017 2018 REVENUES ($M) (Excludes pending acquisition) GROSS MARGIN TRENDING ($M) (Excludes pending acquisition) KEY FINANCIAL METRICS $0.1 $1.4 $5.2 2016 2017 2018 301,787 257,780 381,217 438,400 2016 2017 2018 2019 BILLABLE STAFFING HOURS $0.0 $20.0 $137.0 2016 2017 2018 OPPORTUNITY PIPELINE ($M) 19LISTED SGSI
  20. 20. 2017 A September 30 9M2018 A NET REVENUE 10,775,456 28,604,856 Cost of Revenue 9,411,552 24,436,225 GROSS PROFIT 1,363,904 4,168,631 Operating Expenses 3,058,116 4,688,369 EARNINGS (LOSS) FROM OPERATIONS - EBITDA (1,694,212) (519,738) Depreciation and amortization 239,051 194,043 Gain on disposal of subsidiaries 0 (577,299) Accreditation on Conv Debt 1,603,407 1,477,620 Gain /Loss in Change in FV 2,093,536 175,889 Interest Expense 451,123 796,866 Gain/loss extinguishment of lia 0 (290,814) Loss on Settlement of Debt (3,960,048) (574,375) Stock compensation 3,976,068 (1,116,808) Impairment Loss 1,164 0 Initial Derivative Expense 2,436,259 0 Taxes 42,554 217,419 Noncontrolling Interest (IS) 0 (53,429) Preferred Stock Redemption 0 152,187 NET INCOME (8,577,345) (3,154,653) ADJUSTMENTS TO EBITDA Duplicate accounting people - 80,682 Legal settlements 0 6,500 Severance 0 42,000 Legal fees -ADEX 0 58,663 Exchange Gain & Loss (6,782) 0 Legal & accounting acquisition and financing related 899,379 633,851 Hurricane Impacts, Bad Debt 552,803 Investment Fees 0 - AEBITDA (248,812) 303,454 INCOME STATEMENT 20LISTED SGSI
  21. 21. Cash 301,080 Accounts Receivable (Net of Allowance) 8,022,749 Other Current Assets 16,126 TOTAL Current Assets 8,339,955 Property and Equipment 62,400 Other Assets 3,854,971 TOTAL ASSETS 12,257,326 Accounts Payable 5,527,973 Accrued Liabilities 867,295 Current Maturities of Long-Term Debt 8,221,159 Other Current Liabilities 6,032,521 TOTAL Current Liabilities 20,658,299 Long-Term Liabilities 0 Other Labilities 0 TOTAL LIABILITIES Redeemable Common Stock 0 Preferred Stock, Common Stock, Additional Paid-in Capital, Accumulated Deficit (6,848,219) Other Equity 0 TOTAL Stockholders’ Equity (6,848,219) TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY 12,257,326 BALANCE SHEET DAYS SALES OUTSTANDING (DSO) 1Q2017 65.8 2Q2017 75.1 3Q2017 61 4Q2017 66.6 1Q2018 53.9 2Q2018 58 3Q2018 87.2 AVERAGE DSO 66.8 21LISTED SGSI
  22. 22. CASH FLOWS FROM OPERATING ACTIVITIES: Net Loss (2,546,890) Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities 1,049,163 Net Cash Used in Operating Activities (1,497,727) CASH FLOWS FROM INVESTING ACTIVITIES Net Cash Used in Investing Activities 176,001 CASH FLOWS FROM FINANCING ACTIVITIES Net Cash Provided by Financing Activities 1,593,913 Effect of Exchange Rate Changes on Cash 0 NET INCREASE IN CASH 272,187 Cash, Beginning of Year 28,893 Cash, End of Year 301,080 CAP STRUCTURE CASH FLOW STATEMENT COMMON SHARES OUTSTANDING 7,136,772 PREFERRED SHARES SERIES 1 (AS CONVERTED TO COMMON) 1,127,115 PREFERRED SHARES SERIES 2 (AS CONVERTED TO COMMON)* 0 WARRANTS (WAEP $7.89) 741,323 OPTIONS (WAEP $5.02) 0 22LISTED SGSI
  23. 23. INVESTORS and EXECUTIVE Investor Relations (561) 672-7068 Keith Hayter, President khayter@spectrumgs.com (407) 260-0231 INVESTMENT SUMMARY CONTACT US 300 Crown Oak Centre Drive Longwood, Florida 32750 407-512-9102 spectrumglobalsolutions.com LISTED SGSI 1. PROVEN MARKET OPERATOR in a high-growth telecommunication market segment 2. CLEAR, QUANTIFIABLE ORGANIC growth opportunities 3. NEAR TERM ACQUISITION OPPORUNITIES accretive to growth and synergistic 4. ONE OF THE FEW ENGINEERING AND INSTALLATION COMPANIES able to provide all services and bundle products for telcos 5. EMBEDDED RELATIONSHIPS FOSTERS REPEAT CUSTOMERS at minimal customer acquisition costs. rates 6. REGISTERED IN 49 STATES, 3 US TERRITORIES (PUERTO RICO, USVI, GUAM), 6 CANADIAN PROVINCES 7. PROVEN, EXPERIENCED MANAGEMENT TEAM with extensive industry, sector and public market experience.

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