corporate presentation june 2008. disclaimer this presentation may contain “forward-looking...

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CORPORATE PRESENTATION June 2008

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Page 1: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

CORPORATE PRESENTATIONJune 2008

Page 2: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

DISCLAIMERThis presentation may contain “forward-looking statements” that could present a number of risks and uncertainties. Forward-looking statements are typically identified by the worst “believe”, “expect”, “anticipate”, “intend”, “estimate” and similar expressions. Actual results could differ materially from those contemplated by these forward-looking statements as a result of certain factors. In light of these risks and uncertainties, there can be no assurance that the results and events contemplated but the forward-looking information will in fact transpire. Readers are cautioned not to place undue reliance on these forward-looking statements. SENSIO Technologies Inc. does not undertake the obligation to update or revise forward-looking statements.

Page 3: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

OUR MISSION:To become the world standard for 3D content distribution at home by having the SENSIO® 3D decoding technology available in consumer video equipment (Dolby of 3D)

OUR PLAN:Maintain our technological lead in the stereoscopic field while forging strategic relationships with key content partners (studios, producers, etc.) to quickly become a de facto standard.

Page 4: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

• Company specialized in the development and marketing of stereoscopic (3D) technologies, products and services

• Founded in 1999

• Based in Montreal, Canada

• 13 employees as at March 2008

• Publicly traded company TSX Venture (SIO.V); year-end May 31

EXPERTS IN STEREOSCOPY, FANATICS OF 3D!

Page 5: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

3D EXPLANATION AND CONTENT DISTRIBUTION

Page 6: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

WHAT IS 3D?

L

STEP 2:DISPLAYING

Using various methods, each eye is being presented only its respective image stream

R

2 points of view of the same scene are taken simultaneously at slightly different angles

STEP 1:SHOOTING 3D

STEP 3: PERCEIVING 3D

The brain then fuses both images and get the illusion that objects are in or out of the screen

Page 7: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

2D VS 3D

DISTRIBUTION 2D DISPLAY2D CONTENT CREATION

2D PLAYBACK

• Single camera

• Single film or storage

• Single channel (broadcast) or media (DVD)

• Single image at all times on the screen

• Single channel receivers or single disc players

Page 8: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

2D VS 3D

DISTRIBUTION 3D DISPLAY3D CONTENT CREATION PLAYBACK

3D READY CAMERAS

• Dual cameras• Dual storage• New settings• New rigs + controls

3D READY DISPLAYS• Must display 2 streams

on the screen• Must separate each

stream for each eye• Commercially available

on the CE market since 2007

ONE 3D MOVIE = 2 MOVIES (1 LEFT EYE, 1 RIGHT EYE)

There is no 3D ready distribution infrastructure for the home market

MAIN CHALLENGES

• Bandwidth (twice over 2D)

• Required modification to infrastructure

• Synchronization of the two streams

• Implementation costs

• Quality of 2D and 3D playback

??? ???*

* Except anaglyph

Page 9: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

SENSIO® 3D

DISTRIBUTION 2D DISPLAY2D CONTENT CREATION PLAYBACK

Page 10: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

SENSIO® 3D

DISTRIBUTIONREGULAR TV OR 3D READY

DISPLAY

3D CONTENT CREATION PLAYBACK

SENSIO encoder

SENSIO decoderConventional 2D distribution infrastructure

THE SENSIO 3D TECHNOLOGY USES THE 2D DISTRIBUTION

INFRASTRUCTURE FOR 3D CONTENT

Page 11: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

SENSIO 3Dencoded media

Conventional HD player or digital receiver

EXAMPLE OF INTEGRATION

SENSIO3DIP or chip

Page 12: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

• Stereoscopic compression / decompression with no visual loss (2:1)

• Universal stereoscopic formatter (anaglyphic, page flipping, dual stream, 2D, etc.)

SENSIO® 3D: Transforming the worldwide 2D distribution into 3D

HOLLYWOHOLLYWOODOD

ASIA

Page 13: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

MARKET AND PRODUCTS

Page 14: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

PRODUCT LINE

• PROFESSIONAL LINE– SENSIO LIVE! 3D encoder– SENSIO D-CINEMA decoder– SENSIO 3D software encoding

• CONSUMER LINE– SENSIO 3D decoder chip– IP licensing

Page 15: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

MID/LONG TERM: 200M$/yearGenerate a strong profitability by exploiting the consumer electronic market via the integration of the SENSIO 3D technology as either a chip or intellectual property

D-Cinema

Specialty market

Consumer market

•Chip – mid end•IP Integration – mass market

MARKETSEGMENTATION

SHORT TERM: 5M-10M$/yearCreate visibility to consumers by enabling live 3D events in digital theatres across North America

Page 16: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

BUSINESS MODELD-CINEMA (live events)

PRODUCERSDISTRIBUTORS

BROADCASTERSD-CINEMA

OPERATORS

1 32

PRODUCTSSENSIO 3D LIVE ENCODER

MARKET(USA)

POTENTIAL(total)

Estimated at 1 000 in USA

1 000 X 8K$ = 8M$

SENSIO D-CINEMA DECODER

38 000 screens (1,700 3D - 04/08)

38 000 X 1.5K$ = 57M$

Page 17: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

BUSINESS MODEL CONSUMER MARKET

STUDIOSHOME VIDEO

MANUFACTURERSOF PLAYERS MANUFACTURERS

OF 3D HDTVS

1 32

PRODUCTSSENSIO 3D SOFTWARE ENCODING

MARKET(USA)

POTENTIAL(annual)

Estimated at 30/year in USA

Minimal

SENSIO 3D IP CORE

28M units/year

28M X 5$ = 140M$/YEAR

BROADCASTERSAND TV PROD.

MAN. OF DIGITALRECEIVERS

SENSIO 3D IP CORE

35M units/year

35M X 1$ = 35M$/YEAR

Page 18: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

REST OF WORLD

50M

EUROPE

100M

ASIA

200M

USA

150M

ESTIMATED IP CORE MARKET AT MATURITY

Video products sold worldwide by territory (million units)

500M products X 1,00$ royalty =500M$ potential IP revenues

BUSINESS MODEL CONSUMER MARKET

Page 19: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

YOU WANT MORE?

• OTHER MARKETS

– Game console– PC Card– Mobile phone

Page 20: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

• Founded 16 years ago• Business Model: Licensing (1)

• Consumer division since 1996 (more than 300M DTS products on the market since)

• IPO value (07/2003): 220,5M$US• Market cap.(03/2008): 1,76B$US

(1) SENSIO is using a similar business model as DTS

Figures in 000’s USD 2001 2002 2003 2004 2005

Revenues 28 748 41 056 51 702 61 431 75 252

Gross profit 18 696 30 420 40 670 45 269 55 639

Net profit Net profit 3 9083 908 6 2506 250 9 8999 899 9 9769 976 7 9087 908

Licencing revenues 15 241 25 657 35 374 41 886 56 966

Gross profit 12 259 23 903 33 480 39 821 52 225

Net profitNet profit 4 1024 102 12 71212 712 18 71418 714 19 96919 969 N/AN/A

Page 21: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

Figure’s in 000’s USD 2007 2006 2005 2004

Total revenues $482,03 $391,54 $327,97 $289,04

Gross profits $407,76 $315,50 $247,75 $197,54

Operating income $186,95 $129,58 $$84,06 $67,84

Nets revenuesNets revenues $142,83$142,83 $89,55$89,55 $52,29$52,29 $39,84$39,84

Financial info•Gross margin of 84 %

•Net margin of 39 %

•Market cap.(03/2008): 3.91B$US

Page 22: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

SENSIO: More than a cool technology

Page 23: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

Depth Mapping (DDD, Philipps R&D)

Dual Stream (Dolby, Evertz)

Correlation techniques

(MPEG2 multi, QVis)

Additional bandwidth over 2D25 to 30% more than

2D100% more than

2D40-60% more than

2D

Compatibility with 2D distr. infrastructure

Incompatible Partly compatible Incompatible

Synch. issues DifficultVery difficult and

complexDifficult

Implementation costs for distributors and consumers

Very Costly Very expensive Very costly

Quality of 2D playback and 3D playback

Average 3D, good 2DVery high quality

2D and 3DVery good 2D and

3D

Acceptable Issue/challenging Unacceptable

COMPETITOR ANALYSIS

Page 24: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

The elegant and simple 3D solution

SENSIO 3D

Additional bandwidth over 2D

Same as 2D

Compatibility with 2D distr. Infrastructure

100% Compatible

Compatibility with various 3D displays

100% compatible

Implementation costs for distributors and consumers

Inexpensive

Synchronisation issues

None

Quality of 2D playback and 3D playback

Very good 2D and 3D

BONUS: Real time 2D to 3D Conversion

• Sub-licensing deal with JVC

• Natural depth effect

• Quality: 60% of real 3D content

• Infinite content availability

Page 25: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

We bring 3D content

• SENSIO recognized as the leader by Hollywood studios and producers

• Existing library of titles: 16 SENSIO 3D DVD titles available TODAY

• Upcoming Live 3D events (sports, concerts, shows) in PPV and VOD

• New HD titles from major studios coming soon in 2008

Page 26: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

• Proof of concept done with the award winning S3D-100 stereoscopic video processor (on the market since 2003)

• Alliance with Simplay for HDMI interoperability and consumer user-friendliness

• First SENSIO 3D integration deal signed with SpectronIQ for LCD 3DTV

• Two distributors (Hakuto and Microtek) to support the Japanese, Korean and global Asian markets

• Test platform, content and engineering support available

A practical solution

Page 27: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

A NEW PHASE FOR SENSIO: BECOMING THE DOLBY OF 3D

Page 28: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

PREVIOUS SENSIO MILESTONES

• Patent pending technology (China, India, Japan, Europe, Canada and USA)

• Proof of concept done with the award winning Library of 41 films including 8 from major studios (Disney and Universal)

• Links established with majors studios (clients such as Dreamworks, Disney, and Miramax)

• Advanced discussions with major CE manufacturers for integration (Toshiba, JVC, Sharp, Marantz, Optoma, SAMSUNG, etc.)

• First sales of development boards to CE manufacturers (05/2007)

• Signature of a deal with AccessIT and IDC for Live 3D deployment in digital theatres

• First technology integration inside a consumer 3D-ready display (SpectronIQ

Page 29: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

CONCLUSION

TV Manufacturers are ready to release 3D ready TV on consumer market

SENSIO is very well positionned to become the 3D standard for home consumer market

Recent milestones demonstrate that SENSIO can achieve his goal

Business model is very attractive and represent a huge return on investment opportunity for investors

Page 30: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

• FINANCIAL INFORMATIONS

Page 31: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties

FINANCIAL INFORMATION

Financial Summary – 2008/02/28Assets: $3,384KLiabilities: $1,268KEquity: $2,116KTTM Sales:$179KTTM EBITDA: $1,241KMarket Cap: $ 11.9M

TYPE OPTIONS WARRANTS TOTAL FULLY TOTAL FULLYSHAREHOLDERS ISSUED ISSUED DILLUTED DILLUTED

(K) % (K) (K) (K) %Management and Board 9 314 27.41% 1 201 528 11 043 23.60%Institutionnal 11 908 35.04% - 7 804 19 712 42.13%Float 12 759 37.55% 275 2 995 16 029 34.26%TOTAL ISSUED 33 981 100.00% 1 476 11 327 46 784 100.00%

SHAREHOLDING

Page 32: CORPORATE PRESENTATION June 2008. DISCLAIMER This presentation may contain “forward-looking statements” that could present a number of risks and uncertainties