Lattice Inc.
RedChip Conference
July 17, 2014
Ticker Symbol: LTTC
© 2011, Lattice Incorporated. All Rights Reserved.
Safe Harbor Statement
Management’s prepared remarks contain forward-looking
statements which are subject to risks and uncertainties and
management may make additional forward-looking statements in
response to your questions. Therefore, the company claims the
protection of the Safe Harbor for forward-looking statements that
is contained in the Private Securities Litigation Reform Act of 1995.
Actual results may differ from those discussed today, and therefore
we refer you to a more detailed discussion of the risks and
uncertainties in the company’s filings with the Securities and
Exchange Commission.
The Company
 Technology leader in the correctional facilities
market.
 700% revenue growth from 2009 to 2013.
 Provides a suite of cloud based services
enabling smaller facilities access to technology
traditionally only available to large facilities.
 Providing secure communications and
information technology since 1973.
Financials
2009 2010 2011 2012 2013
Revenue 1,096 3,554 4,572 7,530 8,270
COGS 464 2,343 3,243 5,094 5,461
GP 632 1,211 1,329 2,436 2,809
SGA 1,104 1,299 2,116 1,982 2,769
EBITDA
*
(472) 104 (483) 830 44
* Excludes Government services Division and associated corporate expenses
Correctional Technology Market Overview
 $5.0B+ Market total in Federal, State, and
County
 Additional revenue from other non-
communication based services
 2.3 Million Inmates
 Strong recurring revenue base
 Prison population steadily growing at 3%
annually, capturing market share.
 Communications revenues are split with
prison, alleviating pressure on state and
county budgets.
Innovisit Acquisition
 Industry Leader in Video Visitation Technology
 Integrated with Lattice ICON Platform in 2013
 Implemented first installation in Q1 2013
 Acquired Company Q4 2014
 Adds 15 new states
 Currently serving 90 correctional facilities
 Will add $1.5 - $2.0M additional revenue in 2014
Competitive Landscape
 Small Regional Service Providers
 Solid regional relationships with
smaller facilities
 Outdated Technology generating
lower revenues per inmate
 Large National Service Providers
 Focusing on larger facilities
 Multiple technology platforms through
acquisition making service
inconsistent to smaller facilities.
 Losing smaller facilities as customers
Business Model – US Market
 Exclusive Rights to Facility
 Revenue sharing with Facility
 Provides extra revenue for strapped
state budgets
 Range from 20-60%
 Up-sell Leading Features & Products
Provides customer stickiness
 Ability for family members to credit
inmate’s call account
 Video Visitation
 Kiosk for cash management and value
added services
 Integrated jail management software
solution (difficult to replace)
Sales and Marketing
 Direct Sales to Facilities
 Local sales presence
 Expand upon established local
concentration
 Referrals important for winning county
customers
 Indirect Wholesale & Technology License
Sales
 Utilized by channel partners for larger
facilities and State bids
 For out of direct sales region
 Builds Lattice footprint and brand
recognition
Foreign Market Overview
 Competitive Landscape
 Incumbent Telcos primary competition
 Legacy payphone model (collect
calling)
 New technology yet to be introduced
 Lattice has Unique Technology Advantage
 Lattice technology provides cost
reductions
 Lattice Model provides enhanced
revenue streams
 Lattice technology provides enhanced
security and investigative tools
Foreign Market Overview
 Business Model
 Technology sales/license revenue
 Transaction revenue
 Services revenue
 Current Foreign Sales Pipeline
Asia Canada
Israel Mexico
U.K. India
Belgium Caribbean
Foreign Market Overview
 Canadian Market
 Awarded four installations
 All 4 being implemented in 2013
 Partnered with Telus Canada for
larger provinces
 Smaller facilities partnering with
Wymactel
 U.K. Market
 First site operational in Gibraltar
(2011)
 Successful trial completed in 400
bed facility. Currently responding to
RFPs for multiple facilities
 90,000+ inmate potential in UK
Foreign Market Opportunity
 Retained Communication Media
Advisors to Accelerate International
Expansion:
 Identify most attractive markets for
expansion.
 Identify potential partners and
licensees that best enable Lattice to
successfully win new business in
these markets.
 Phase I of the project will be
completed in Q2 of this year.
Device Agnostic
SECURE COMMUNICATIONS CLOUD
COMMISSARY ORDERING
SCHEDULING SERVICES
LEGAL COUNSEL
INMATE E DEVICE
EMAIL
INTEGRATION SERVICES
MUSIC DOWNLOAD
EDUCATION
INVESTIGATION
VIDEO VISITATION
SOCIAL MEDIA
DEDICATED INMATE STATION
TEXT MESSAGING
VOICE MAIL
HOME PC
SECURE FIREWALL
Secure
Secure Communication Layer
ICON will consist of five major
components:
• Products and Services management
• Customer Information Database
• Payment Processing
• Accounting/Billing
• Customer Care
ICON Core
All communication between payments and
services will utilize ICON’s Secure
Communication Layer. Outside development
firms will have standard interfaces to utilize
Integrated Corrections Operations Networks (ICON)
Communication
ICON
Application
Management
ICON will provide centralized database
management and payment capability.
Utilizing the a central core engine will
allow multiple software applications
to reuse software processes saving
development time and producing far
more efficient business practices.
Jail Management
System
Secure
Products and Services managed and
accounted for by ICON
Communication
PIN Debit and PPC
Phone Accounts
ICON
Application
Management
Jail Management
System
Secure
The ICON JMS includes the
following features:
•Reporting
•Scheduling
•Multi-Facility/Multi Agency
Integration
•Special Diet/Meal Count
•Workflow
•Biometrics
•Booking
•Trust Accounting/General Ledger
•Medical Records
•Incident Reporting
•NCIC Background screening
Communication
ICON
Application
Management
The ICON Jail Management System
(JMS) is a key component to the ICON
core. The JMS stores and manages
correctional facility processes, inmate
booking, inmate information, and
trust accounting
Jail Management
System
ICON Jail Management System
Investment Highlights
 Rapid expansion of the Company’s
service and technology sales to drive
overall growth and margin improvement.
 Lattice offers industry leading proprietary
technology to traditionally underserved
area of the market—small and midsized
correctional facilities.
 International expansion with key
partnerships growing sales and margin
growth while increasing the Company’s
footprint.
 700% revenue growth over the last 4
years. Early stages of growth potential.
Q&A
Contact:
Jon Cunningham
RedChip Companies, Inc.
1.800.REDCHIP x107 | 407.644.4256 x107
Jon@Redchip.com
Paul Burgess
CEO
pburgess@latticeinc.com
856-910-1166 ext 2111

Lattice: RedChip's Global Online CEO Conference

  • 1.
    Lattice Inc. RedChip Conference July17, 2014 Ticker Symbol: LTTC © 2011, Lattice Incorporated. All Rights Reserved.
  • 2.
    Safe Harbor Statement Management’sprepared remarks contain forward-looking statements which are subject to risks and uncertainties and management may make additional forward-looking statements in response to your questions. Therefore, the company claims the protection of the Safe Harbor for forward-looking statements that is contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ from those discussed today, and therefore we refer you to a more detailed discussion of the risks and uncertainties in the company’s filings with the Securities and Exchange Commission.
  • 3.
    The Company  Technologyleader in the correctional facilities market.  700% revenue growth from 2009 to 2013.  Provides a suite of cloud based services enabling smaller facilities access to technology traditionally only available to large facilities.  Providing secure communications and information technology since 1973.
  • 4.
    Financials 2009 2010 20112012 2013 Revenue 1,096 3,554 4,572 7,530 8,270 COGS 464 2,343 3,243 5,094 5,461 GP 632 1,211 1,329 2,436 2,809 SGA 1,104 1,299 2,116 1,982 2,769 EBITDA * (472) 104 (483) 830 44 * Excludes Government services Division and associated corporate expenses
  • 5.
    Correctional Technology MarketOverview  $5.0B+ Market total in Federal, State, and County  Additional revenue from other non- communication based services  2.3 Million Inmates  Strong recurring revenue base  Prison population steadily growing at 3% annually, capturing market share.  Communications revenues are split with prison, alleviating pressure on state and county budgets.
  • 6.
    Innovisit Acquisition  IndustryLeader in Video Visitation Technology  Integrated with Lattice ICON Platform in 2013  Implemented first installation in Q1 2013  Acquired Company Q4 2014  Adds 15 new states  Currently serving 90 correctional facilities  Will add $1.5 - $2.0M additional revenue in 2014
  • 7.
    Competitive Landscape  SmallRegional Service Providers  Solid regional relationships with smaller facilities  Outdated Technology generating lower revenues per inmate  Large National Service Providers  Focusing on larger facilities  Multiple technology platforms through acquisition making service inconsistent to smaller facilities.  Losing smaller facilities as customers
  • 8.
    Business Model –US Market  Exclusive Rights to Facility  Revenue sharing with Facility  Provides extra revenue for strapped state budgets  Range from 20-60%  Up-sell Leading Features & Products Provides customer stickiness  Ability for family members to credit inmate’s call account  Video Visitation  Kiosk for cash management and value added services  Integrated jail management software solution (difficult to replace)
  • 9.
    Sales and Marketing Direct Sales to Facilities  Local sales presence  Expand upon established local concentration  Referrals important for winning county customers  Indirect Wholesale & Technology License Sales  Utilized by channel partners for larger facilities and State bids  For out of direct sales region  Builds Lattice footprint and brand recognition
  • 10.
    Foreign Market Overview Competitive Landscape  Incumbent Telcos primary competition  Legacy payphone model (collect calling)  New technology yet to be introduced  Lattice has Unique Technology Advantage  Lattice technology provides cost reductions  Lattice Model provides enhanced revenue streams  Lattice technology provides enhanced security and investigative tools
  • 11.
    Foreign Market Overview Business Model  Technology sales/license revenue  Transaction revenue  Services revenue  Current Foreign Sales Pipeline Asia Canada Israel Mexico U.K. India Belgium Caribbean
  • 12.
    Foreign Market Overview Canadian Market  Awarded four installations  All 4 being implemented in 2013  Partnered with Telus Canada for larger provinces  Smaller facilities partnering with Wymactel  U.K. Market  First site operational in Gibraltar (2011)  Successful trial completed in 400 bed facility. Currently responding to RFPs for multiple facilities  90,000+ inmate potential in UK
  • 13.
    Foreign Market Opportunity Retained Communication Media Advisors to Accelerate International Expansion:  Identify most attractive markets for expansion.  Identify potential partners and licensees that best enable Lattice to successfully win new business in these markets.  Phase I of the project will be completed in Q2 of this year.
  • 14.
    Device Agnostic SECURE COMMUNICATIONSCLOUD COMMISSARY ORDERING SCHEDULING SERVICES LEGAL COUNSEL INMATE E DEVICE EMAIL INTEGRATION SERVICES MUSIC DOWNLOAD EDUCATION INVESTIGATION VIDEO VISITATION SOCIAL MEDIA DEDICATED INMATE STATION TEXT MESSAGING VOICE MAIL HOME PC SECURE FIREWALL
  • 15.
    Secure Secure Communication Layer ICONwill consist of five major components: • Products and Services management • Customer Information Database • Payment Processing • Accounting/Billing • Customer Care ICON Core All communication between payments and services will utilize ICON’s Secure Communication Layer. Outside development firms will have standard interfaces to utilize Integrated Corrections Operations Networks (ICON) Communication ICON Application Management ICON will provide centralized database management and payment capability. Utilizing the a central core engine will allow multiple software applications to reuse software processes saving development time and producing far more efficient business practices. Jail Management System
  • 16.
    Secure Products and Servicesmanaged and accounted for by ICON Communication PIN Debit and PPC Phone Accounts ICON Application Management Jail Management System
  • 17.
    Secure The ICON JMSincludes the following features: •Reporting •Scheduling •Multi-Facility/Multi Agency Integration •Special Diet/Meal Count •Workflow •Biometrics •Booking •Trust Accounting/General Ledger •Medical Records •Incident Reporting •NCIC Background screening Communication ICON Application Management The ICON Jail Management System (JMS) is a key component to the ICON core. The JMS stores and manages correctional facility processes, inmate booking, inmate information, and trust accounting Jail Management System ICON Jail Management System
  • 18.
    Investment Highlights  Rapidexpansion of the Company’s service and technology sales to drive overall growth and margin improvement.  Lattice offers industry leading proprietary technology to traditionally underserved area of the market—small and midsized correctional facilities.  International expansion with key partnerships growing sales and margin growth while increasing the Company’s footprint.  700% revenue growth over the last 4 years. Early stages of growth potential.
  • 19.
    Q&A Contact: Jon Cunningham RedChip Companies,Inc. 1.800.REDCHIP x107 | 407.644.4256 x107 Jon@Redchip.com Paul Burgess CEO pburgess@latticeinc.com 856-910-1166 ext 2111