Slide presentation

EX-99.1 2 dex991.htm SLIDE PRESENTATION Slide presentation

Confidential | ©

2006 Planar Systems, Inc.

Planar Business Update

August, 2006

Exhibit 99.1

Confidential | ©

2006 Planar Systems, Inc.

This presentation contains forward-looking statements within

the meaning of the Securities Litigation Reform Act of 1995

that are based on current expectations, estimates and

projections about the Company's business, management's

beliefs, and assumptions made by management.

These statements are not guarantees of future performance

and involve certain risks, uncertainties and assumptions that

are difficult to predict. Therefore, actual outcomes and results

may differ materially from what is expressed in such forward-

looking statements.

These statements speak only as of today and the company

undertakes no obligation to update any such statements to

reflect events or circumstances occurring after today.

Safe Harbor Provisions

Confidential | ©

2006 Planar Systems, Inc.

In connection with Planar’s

acquisition of Clarity Visual Systems, Planar intends to file with the

Securities and Exchange Commission a registration statement on Form S-4 that will contain a Proxy

Statement/Prospectus. Investors and security holders are urged to read the Registration Statement and

the Proxy Statement/Prospectus carefully when they become available because they will contain

important information about Planar, Clarity and the acquisition.

The Proxy Statement/Prospectus and

other relevant materials (when they become available), and any other documents filed by Planar with

the SEC, may be obtained free of charge at the SEC’s web site at www.sec.gov. In addition, investors

and security holders may obtain free copies of other documents filed with the SEC by Planar by

directing a written request to: Planar Systems, Inc., 1195 N.W. Compton Drive, Beaverton, OR 97006,

Attention: Investor Relations. Investors and security holders are urged to read the Proxy

Statement/Prospectus and the other relevant materials when they become available before making any

voting or investment decision with respect to the proposed acquisition.

Planar and its directors and executive officers and Clarity Visual Systems and its directors and executive

officers may be deemed to be participants in the solicitation of

proxies from the shareholders of Clarity in

connection with the proposed transaction. Information regarding

the special interests of these directors

and executive officers in the proposed transaction will be included in the Proxy Statement/Prospectus

referred to above. Additional information regarding the directors and executive officers of Planar is also

included in Planar’s

Proxy Statement dated December 22, 2005, which was filed with the SEC on

December 29, 2005. This document is available free of charge at

the SEC’s web site (www.sec.gov)

and from Investor Relations at Planar at the address described above.

Additional Information about the

Merger and Where to Find It

Confidential | ©

2006 Planar Systems, Inc.

Planar Company Overview

Update on New Strategic Direction

Future Revenue Growth and Business Model

Q&A

Presentation Agenda

Confidential | ©

2006 Planar Systems, Inc.

Long history focused on Display businesses

U.S.

Based

Company

Founded

1983

(I.P.O.

1993

Nasdaq:

PLNR)

Panel

Manufacturing

Finland

(Number

one

world)

Strong balance sheet ($76M in Cash), profitable, no

debt

New leadership on board to drive shareholder value

Three established business units

Medical Displays

Industrial Displays

Commercial Displays

Planar at a Glance

Confidential | ©

2006 Planar Systems, Inc.

Medical Business Unit

FY 2005 -

$75M in Revenue

Focused on high end Digital Imaging

displays for medical applications

Significant new product introductions in

first quarter 2006

E4c -

First medically certified 4 mega pixel

diagnostic color monitor

New products, management and selling

resources are in place…..

Focused at the growing market for medical

displays

Confidential | ©

2006 Planar Systems, Inc.

Industrial Business Unit

FY 2005 -

$55M in Revenue

Leverages historical core competency in EL displays

Strong operating margin business

Focused on applications where usage conditions are

very demanding:

Rugged, temperature tolerance, shake/shock, etc.

Confidential | ©

2006 Planar Systems, Inc.

Commercial Business Unit

FY 2005 -

$102M in Revenue

Virtual business model

Products sourced from Asian partners -

leveraging our display knowledge

Sold through resellers (CDW, ICG, Insight,

etc.) –

B2B

Lean and efficient structure

Differentiated through quality and

support and high end products

Drives brand creation for Planar

Confidential | ©

2006 Planar Systems, Inc.

Financials –

Past and Present

Fiscal ’03 and ’04 had EPS of $1.04 and $0.62, respectively

First half of Fiscal ’05 saw large step down to breakeven level

of Non-GAAP EPS

Expense increase to fund growth initiatives

Margin pressure, revenue challenges

Cost actions to reduce ongoing overhead expenses were

taken at end of Q2 (2005) -

$3.4M per quarter reduction in

costs (est.)

Last five quarters profitability returned

9¢

per share in Q305

12¢

per share in Q405 (non-GAAP)

13¢

per share in Q106 (non-GAAP)

19¢

per share in Q206 (non-GAAP)

13¢

per share in Q306 (non-GAAP)

Confidential | ©

2006 Planar Systems, Inc.

P&L Trend

Sales

GM%

EPS (GAAP)

Restructuring/Inventory

Share-based Comp.

EPS (Non-GAAP)

Diluted Shares

-----

in $M (except per share data) ------

Fiscal Year

2005

$53.2

23.3%

$0.09

14.8

$54.5

18.9%

-$2.18

$36.9

$0.12

14.7

$57.1

25.0%

$0.10

$0.7

$0.13

14.8

Fiscal Year 2006

$52.9

28.3%

$0.13

$1.4

$0.19

15.5

$49.4

27.0%

$0.11

$0.7

$0.13

15.6

Confidential | ©

2006 Planar Systems, Inc.

* Non-GAAP amounts exclude share-based compensation.

GAAP EPS = $0.10, $0.13, & $0.11 per share for Q106, Q206, & Q306 respectively.

G&A includes $0.3M & $0.2M restructuring charges in Q106 and Q206 respectively.

Quarterly Income Statement

Non-GAAP*

Sales

Gross Margin

Operating Expenses

Research and Development

Sales and Marketing

G&A

Amortization of Intangibles

Operating Income

EPS

-----

$ in M (except per share data)------

$49.4

13.4

2.4

4.8

3.3

0.1

$ 2.8

$0.13

$57.1

14.3

2.5

5.1

3.9

0.1

$ 2.7

$0.13

Fiscal Year 2006

$52.9

15.0

2.5

4.6

4.1

0.1

$ 3.7

$0.19

Confidential | ©

2006 Planar Systems, Inc.

P&L Summary

Sales Flat to declining

Most of the decline is from our Commercial business

–

ASP’s for desktop monitors have dropped dramatically over the last 6-8 months

–

Focus on profit contribution rather than volume in general purpose monitors

Gross Margins increasing

Improved margins within the business units

–

Includes better performance in our Commercial segment despite falling prices

Improved mix of products

–

sales

higher

margin

Industrial/Medical

products

relative

Commercial

products

Profits/Cash Flow

Profitability relatively stable with non-GAAP EPS between 9¢-19¢

the last

5 quarters

At ~10¢

EPS we expect to generate $3M-$4M of cash per quarter

–

Driven

operating

profits

and

depreciation/amortization

higher

than

CAPEX

–

Assuming no material changes in working capital

Confidential | ©

2006 Planar Systems, Inc.

Cash and cash equivalents* ($M)

Current Ratio

Inventory ($M)

Accounts Receivable ($M)

Days Sales Outstanding (DSO)

Depreciation/Amortization ($M)

Capital Expenditures ($M)

*No Debt

Sep. ‘05

$65.2

3.7

$36.3

$22.5

$2.1

$1.4

Key Balance Sheet and Related

Metrics

Jun ‘06

$76.2

4.5

$37.5

$21.9

$1.8

$0.3

Mar. ‘06

$73.3

4.4

$37.0

$21.4

$1.9

$0.4

Confidential | ©

2006 Planar Systems, Inc.

Strategy Update

Reduce cost structure

Annual Non-GAAP exit

rate

$0.50

EPS

Begin leadership

change

Fisca

2005

2006

2007

and

thereafter

Stabilize profitability and cash generation

Build investor confidence

Re-charge Medical business

Rationalize current businesses and

develop new strategic growth strategy

Build out leadership to drive new strategy

Implement new strategic

growth strategy

Increase shareholder

value

Confidential | ©

2006 Planar Systems, Inc.

New Strategic Direction

Focus on specialty display technology segments

More opportunity for differentiation

Higher gross profit margins

Less emphasis on general purpose products

Leverage value from commercial business unit (Channels, suppliers, logistics,

service/quality, etc.)

Two

current

business

units

fit

this

focus

(Medical

and

Industrial)

Expand into additional specialty segments

Specialty Home Theater

Command and Control

Digital Signage

More in future…..

Leverage new strategy to drive substantial increase in shareholder

value over next 3 years

Confidential | ©

2006 Planar Systems, Inc.

Current Specialty Markets Served

Industrial

($1.5B)

Medical

Diagnostic

Imaging

($220M)

Commodity

Displays

Specialty Displays

Confidential | ©

2006 Planar Systems, Inc.

New Strategic Initiatives

Specialty Display Focus vs. Commodity

Specialty

Home Theater

($1.6B*)

Command &

Control

($400M)

Digital Signage

(>$1.3B*)

Other Specialty

Display Markets

* Fast Growing Markets (greater than 15% a

year)

Industrial

($1.5B)

Medical

Diagnostic

Imaging

($220M)

Commodity

Displays

Confidential | ©

2006 Planar Systems, Inc.

Strategic Actions

……Current Businesses

Medical (MBU)

Leverage recent investments to drive Digital Imaging growth

Industrial (IBU)

Initiated investments to drive revenue growth for EL and Custom

AMLCD displays (Europe/China last year, U.S. this year)

Launch new products (stereo mirror, police monitors, etc.)

Look for market consolidation opportunities

Commercial (CBU)

Continue focus on profit contribution from existing products

Seek out opportunities to improve margins and leverage channels

and supply base

–

Touch screens, projectors, large format monitors, digital signage solutions,

etc……

Confidential | ©

2006 Planar Systems, Inc.

Home Theater Initiative

Focus: High-end, valued added home cinema displays

Market Size (Addressable): $1.6B Worldwide

Projected Growth Rate: 25% CAGR through ‘09

Strategy:

Hire small, dedicated team of Home Theater experts to enter the

market

–

Scott Hix, former VP at InFocus

–

Brad Gleeson, former President Activelight

Establish strong relationships with specialty A/V distributors

Penetrate the market through highly differentiated product offering

(Xscreen)

Additional products soon…..

Confidential | ©

2006 Planar Systems, Inc.

Signage and Control Room

Clarity Acquisition -

$59M LTM Revenue

Focus on Command and Control Room and Digital

Signage marketplace

Anticipated close –

August through October, 2007

Anticipated to be slightly accretive compared to

internal standalone projections in first year (non-

GAAP)

Confidential | ©

2006 Planar Systems, Inc.

Clarity -

Command & Control

Strong market with growing opportunities

$400M annual sales worldwide, 15% CAGR*

Stable, growing market

High margin opportunities with room for product differentiation

Excellent channel partners for marketing and distribution

Go to market strategy:

Premium quality, innovative display solutions

Geographic sales support of qualified VAR network

Vertical market emphasis through customer success stories,

reference installations

–

Transportation and Traffic Control

–

Security and Defense

–

Energy and other Utility

–

Telecom and Broadcast

* iSuppli

2006 Planar Systems, Inc.

Clarity -

Command & Control

Control Room Visual Systems

Stock Exchanges, Trading Floors

Control Rooms

2006 Planar Systems, Inc.

Clarity -

Digital Signage

Market is experiencing rapid growth

Worldwide market for just displays is estimated at $1.3B in 2006, growing

to $2.3B in 2008*

Market Drivers:

Broadband delivery of multimedia content

Dropping display component prices driven from broad consumer adoption

Trends away from broadcast advertising towards targeted marketing

campaigns

Clarity / CoolSign is an industry leader

Over 5,000 networked signs installed and running

Strong partnerships with networking and integration companies

Synergies with Planar Kiosk investments

Focused on key verticals

Transportation

Retail Banking

Public Venue Advertising (indoor)

Retail

Casino/hospitality

* iSuppli

2006 Planar Systems, Inc.

Clarity -

Digital Signage

Public Venue Advertising

Transportation

Retail

Retail Banks

Casino and Hospitality

2006 Planar Systems, Inc.

Specialty Display Technology Strategy

Product Development & Technology

Supply Chain

Vertically Aligned Go-to-Market

2006 Planar Systems, Inc.

Expanding with a Multi-Niche Strategy

Target Revenue -

$365M to $400M in 2009

Medical

($75M)

Industrial

($55M)

Home

Theater

Command

& Control

($35M)

Digital

Signage

($15M)

Market

Growth &

Gains with

PACS

Suppliers in

Market

Growth &

Possible

Market

Consolidato

Market

Growth &

Leverage

unique

product

offering to

gain share

in the high-

end

Market

Growth &

Gains

Establish

Leadership

Position in

Emerging,

High

Growth

Market

$95M

$55M

$50M

$60M

New

Segments

Other

Specialty

Display

Segments

$10-45M

* Note: Excludes on-going general purpose display business

2006 Planar Systems, Inc.

Business Model

Sales

GM%

OPEX%

OIBT%

FY2006

(est.)

$208M

27%

21%

FY2008

(est.)

$330M

30%

20%

10%

Note:

All

estimates

are

Non-GAAP.

Non-GAAP

excludes

share-based

compensation,

intangibles

amortization,

and

restructuring/other

charges

2006

(est.)

assumes

middle

Q406

guidance

and

the

acquisition

Clarity

closes

Q107

Longer Term

Goals:

Sales Growth

= 10% to 20%

OIBT

10%

2006 Planar Systems, Inc.

Summary

Cost actions taken to solidify and sustain profitability

Strong balance sheet, cash position and operating cash

flow

Further utilization of cash position is under review

New Strategic Initiatives taken to fuel future growth and

Profits

Improving performance in existing lines of business

New strategic initiatives launched and being implemented

2006 Planar Systems, Inc.

Q&A