microcapclub invitational: xpel technologies (dap.u / xplt)
TRANSCRIPT
XPEL TECHNOLOGIES CORP. MicroCapClub Invitational
FORWARD LOOKING STATEMENTS
This Presentation contains certain forward-looking statements in respect of various
matters including upcoming events that involve known and unknown risks and
uncertainties that are beyond the control of Management. Those risks and uncertainties
include, among other things, risks related to: share prices, liquidity, creditworthiness,
currency, insurance, dilution, ability to access capital markets, interest rates, dependence
on key personnel and environmental matters. Management believes that the expectations
reflected in forward-looking statements are based upon reasonable assumptions and
information currently available; however, Management can give no assurance that actual
results will be consistent with these forward-looking statements. Factors and assumptions
that were applied in drawing conclusions and could cause actual results, performance, or
achievements to differ materially from those expressed or implied by forward-looking
statements, include, but are not limited to, general economic conditions, competition,
availability of manufacturing supply or quality, availability and quality of raw materials, the
Company’s ability to maintain key employees and other factors identified in the “Risk
Factors” section of the Company’s Management’s Discussion and Analysis (MD&A)
available at www.xpel.com/relations.
• Film Protects Painted
Surfaces from Rock Chips
and other Damage
• Made on a Roll, Cut to Fit
• Requires Professional
Installation
• Usually Sold Around
Vehicle Purchase
PAINT PROTECTION FILM
Rock Chips - #1 New Car CSI Issue
• Ticker: TSXV: DAP.U
• Founded 1997
• Based in San Antonio, Texas
• ~40 Employees
• Stock Price*: $1.47
• Market Cap*: $37.9M
• ~50% Insider Ownership
• No Warrants or Options
CORPORATE OVERVIEW
* Based on 25.7 million shares outstanding as of January 14th, 2014
REVENUE BY QUARTER
$880,755
$1,160,767
$4,898,729
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
Q1
2008
Q2
2008
Q3
2008
Q4
2008
Q4
2009
Q1
2010
Q2
2010
Q3
2010
Q4
2010
Q2
2011
Q2
2011
Q3
2011
Q4
2011
Q1
2012
Q2
2012
Q3
2012
Q4
2012
Q1
2013
Q2
2013
Q3
2013
Revamp
Sales
Force/Comp
First
ULTIMATE
Film Sale
Expand
Awareness
Campaigns
NET INCOME BY QUARTER
$596,895
$392,895
($1,200,000)
($1,000,000)
($800,000)
($600,000)
($400,000)
($200,000)
$0
$200,000
$400,000
$600,000
$800,000
Q1
2008
Q2
2008
Q3
2008
Q4
2008
Q4
2009
Q1
2010
Q2
2010
Q3
2010
Q4
2010
Q2
2011
Q2
2011
Q3
2011
Q4
2011
Q1
2012
Q2
2012
Q3
2012
Q4
2012
Q1
2013
Q2
2013
Q3
2013 Pre-Tax
Net
New
Management
PRODUCT OVERVIEW
Film
• ULTIMATE
• XTREME
• Stealth
• Industrial
• Headlight
• Window Tint
Services
• DAP
• Training
• Installation
Chemicals
• Installation
• Care
DIY
• Headlight
• Door Edge
• Door Sill
• TracWrap
• 10-Year Warranty
• Optically Clear, Minimal “Orange Peel”
• Resists Staining
• Self Healing
ULTIMATE™ FILM CONSTRUCTION
Release Liner
Adhesive
Polyurethane
“ULTIMATE” Clear Coat
• Internet-Based Cutting
Program
• Real Time Design Updates
• Over 70,000 Vehicle
Applications
• Key Differentiator, Pull Through
Tool
DESIGN ACCESS PROGRAM
INSTALLATION TRAINING
• 4-Day Starter Course
• 1-Day Advanced Course
• Training Starts Learning
Process
• Also Offered Offsite,
Internationally
FILM INSTALLATION
• We Sell Solutions First, Products Second
• Offer Highest Quality Products
• Generate Awareness, Loyalty Through Marketing
Campaigns and Referral Programs
XPEL VALUE PROPOSITION
Who You Are
Enthusiast
First Time
Buyer/Long
Term Owner
Serial Vehicle
Leaser
Dealership
Customer
Your car is your
passion
This is a largest
investment, it
needs to be
protected
Looking to save on
damage charges at
return
You buy what they
want you to buy
SALES DRIVERS
Where You Are
“Coast” Winter Weather China Middle East
Early adopter:
ex: California
Denver, SLC,
Alberta Acid Rain Sand
• Independent Installers ~ 70% of Customers
• New Car Dealerships
• Retail Public / Catalog
• International Distributors ~ 30% of Sales
• Largest Customer 7% of Sales
CUSTOMER BASE
International
Canada
China
Middle East
• Dealerships Need Tangible Products
• PPF Often Tops List of Most Profitable*
• Rock Chips Continues as Top CSI Complaint
• Independent Installers Seek New Products
• Where Will Penetration Go?
GROWTH PROSPECTS
*AddOnAuto 2013 Auto Accessories Annual Trend Report
• Current Industry: 2-4% Penetration
• Select Markets 20%+
• US 15M SAAR
– 15M * 10% Penetration * $120 wholesale per car
– = $180M at wholesale industry size
INDUSTRY GROWTH PROSPECTS
• Invest in XPEL Brand
• Increase Product Awareness
– Push – Consumer Awareness
– Pull – Dealership Education
• Develop Labor Force
• Open and Expand Markets Globally
• Create New Verticals
REQUIREMENTS FOR GROWTH