Redline AGM 2012

© Redline Communications Inc. 2012. All rights reserved.

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June 2012

Annual General Meeting 2012Redline Communications Group Inc.

Eric Melka, CEO

http://www.rdlcom.com


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Forward-Looking Statements

From time to time Redline makes written and oral statements that constitute forward-looking information within the meaning of applicable securities laws (“forward- looking statements”). Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Business, or developments in Redline’sindustry, to differ materially from the anticipated results, performance, achievements or developments expressed or implied by such forward-looking statements. Forward-looking statements include all disclosure regarding possible events, conditions or results of operations that are based on assumptions about future economic conditions and courses of action. Forward- looking statements may also include, without limitation, any statement relating to future events, conditions or circumstances. Redline cautions you not to place undue reliance upon any such forward-looking statements, which speak only as of the date they are made.

These statements may include, but are not limited to, comments about: our objectives and priorities for 2012 and beyond, our strategies, expectations for our financial condition, the outlook for our operations, and external factors that may impact results, including global economies and industry trends. Forward-looking statements are based on management’s current plans, estimates, projections, beliefs and opinions, and Redline does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change. We caution that this list is not exhaustive of all possible factors. Other factors could adversely affect our results. For more information, please see the discussion on the principal risks that could affect our results, which is included in our most recent MD&A and in our latest annual information form, available on SEDAR at www. sedar.com. The assumptions behind our outlook are also discussed in our public filings.



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High-performance, high-reliability, high-speed wireless for Machine-to-Machine (M2M) communication for industrial applications

Recognized technology leader

Software-driven hardware platform

Very large diversified customer base in wide geographic regions in Energy, Military, Public Safety, Telecom Service Providers

Growing revenue

Profitable

Emerged from a turnaround in 2011 with new management

The New and Improved Redline



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We make high-speed wireless networking systems for machine-to-machine communications, systems that: control and manage oil fields connect video surveillance cameras over long

distances bring fast internet access to remote locations

We are quite simply the best at connecting people and machines in places where other technologies simply do not work

Redline Introduction



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What’s so special about our products?

4 things – they are: Incredibly Rugged Super Reliable Extremely Powerful Totally Secure

Redline is EVERYWHERE more than a 150,000 systems installed, in more than

100 countries.

And we are Growing

Introduction



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OIL & GAS

Redline creates a communication “canopy” for Oil & Gas companies to improve operational results and safety

Provides visibility into fields of operations over immense areas

Completes a communications layer and platform

Carries any type of Data – from VOIP to Wi-Fi, to H2S to Video and more

Creates platform for SmartField

Oil & Gas



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MILITARY

Redline off-the-shelf broadband radios are the most deployed radio in the US DoD

Rapid deployment in hostile environments

Instant & secure communications. The first PMP Broadband radio to receive the FIPS 140-2 Military Grade certification by US DoD

Everyone & everything connected: Smart Soldier, cameras, sensors, wi-fi clouds, people

Military



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PUBLIC SAFETY

Redline’s products provide the visibility critical to public safety

Extends distribution of video surveillance without the need to run wires.

Allows for high definition, face recognition cameras to be placed anywhere.

Multicasting

Monitors all types of sensors

Public Safety



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TELECOM

Redline's broadband wireless solutions are used globally by the telecom industry.

Delivery of high speed wireless allows telecome service providers to offer wireline high speed service to Schools, Hospitals, Compounds and Strategic accounts

Provides high performance Point to Multi-Point backhaul and business access

Expands high-value residential &business applications into underserved areas

An economical alternative to fiber in underserved and developing countries.

Telecom Service Providers



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Wireless Solutions = “Wireless Fiber”TM



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Machine To MachineMachine To Machine

Personal Mobile Voice

Mobile Data & Applications

Wave 1

Wave 2

Wave 3 >

The third wave of wireless is M2M



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Press Releases Distributed

Articles about Redline Published

Mentions of our Press Releases

Number of Search Results for Redline

Original Oil & Gas Video

973

500113000

1

Redline in the news

During the last 3 months…..



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Sample Coverage from March – May 2012



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Investor Roadshows

Analyst Introductions

One-on-Ones with Fund Managers

Analysts building models

Analyst Formally Covering

Stories about Redline’s turnaround

412

21315

Investor Relations – May to June



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Establishing relationships



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-

10

20

30

40

50

60

70

2008 2009 2010 2011

Revenues are growing…



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0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

120.0%

140.0%

2008 2009 2010 2011

Expenses are decreasing



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0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

2008 2009 2010 2011

Margins are growing



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$-

$10

$20

$30

$40

$50

$60

2009 2010 2011 2012* 2013*

WiMAX

BWI

* Analyst EstimatesByron Capital

Total Shipped Revenue

Shipped Revenue BreakdownMillions

Growth in core BWI Business

*analyst projections



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MILITARY:

SURVEILLANCE/PUBLIC SAFETY:

TELECOM SERVICE PROVIDERS:

ENERGY (OIL & GAS):

All logos the property of their respective owners

Customers



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Large Military OEM

Partners bring scale



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Profitable sustainable Growth by:

+ Maintaining technical dominance

+ Expanding software, solutions, services revenues

+ Developing strong strategic Partners like Cisco and Honeywell

+ Continuing with large customer opportunities

+ Balancing revenues globally

+ Keeping expenses in line

What to expect from us…



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New experienced management

Focused market strategy

Key Customers - Globally

Channel and Strategic Partner “go-to-market”

Major OEM with US military supplier

Over 20 patents (some pending)

Positioned to win



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Thank you and stay tuned for more great news at rdlcom.com



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June 28, 2012

AGM Presentation – FinanceGeorge Kypreos



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2011 P&L

(millions) 2011 % rev. 2010 % rev. Var. %

Revenue 58.0$ 54.4$ 6.6%

Cost of sales 24.2 24.3

Gross Profit 33.8 58.3% 30.1 55.3% 3.0 pts

Oper. Expenses 27.8 47.9% 27.6 50.7% 0.7%

Oper. Income 6.0$ 10.3% 2.5$ 4.6% 140.0%



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FY2011 – Other Operating Comments

Adjusted EBITDA increased by $4.4 million or 131.2% to $7.8 million for the year as compared to $3.4 million last year

Net income improved by 118.6% to $4.1 million as compared to $1.9 million for 2010

Diluted EPS of $0.18



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1Q’12 P&L

(millions) 1Q'12 % rev. 1Q'11 % rev. Var. %

Revenue 12.5$ 13.5$ (7.4)%

Cost of sales 6.0 5.1

Gross Profit 6.5 52.0% 8.4 62.2% (10.2) pts

Oper. Expenses 6.1 48.8% 6.8 50.4% (10.3)%

Oper. Income 0.4$ 3.2% 1.6$ 11.9% (75.0)%

(in thousands) Bookings % of totals Shipped % of totals Gross Backlog % of totals

Margins %

Product

BWI 7,035$ 58% 5,548$ 64% 61% 2,092$ 42%

RedMAX 1,661$ 14% 1,661$ 19% 48% -$ 0%

Professional Services & Other 1,165$ 10% 1,048$ 12% 35% 973$ 19%

Maintenance and support 2,213$ 18% 435$ 5% 100% 1,970$ 39%

Totals 12,074$ 100% 8,692$ 100% 5,035$ 100%

Three months ended

March 31, 2012



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1Q’12 – Other Operating Comments

Adjusted EBITDA of $700 thousand

Net loss of $6.6 million as a result of a non cash charge of $6.6 million on the FMV of the Debenture



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Balance Sheet

(Millions) 31-Mar-11 31-Dec-11 31-Mar-12

Cash 2.6$ 4.8$ 3.4$

Accounts Receivable 7.8 10.2 8.0

Inventories 5.0 7.9 8.1

Other assets 3.1 3.5 2.8

Assets before Deferred 18.5 26.4 22.3

Deferred cost of revenue 16.5 7.8 5.6

Total Assets 35.0$ 34.2$ 27.9$

Accounts Payable 9.3$ 9.4$ 6.8$

Borrowings (principal and interest) 6.3 7.5 7.7

Liabilites before FMV, Deferred and Deficit 15.6 16.9 14.5

FMV Adj. on Debenture - 2.9 9.5

Deferred revenue 31.3 16.5 12.3

Deficit (11.9) (2.1) (8.4)

Total Liabilities/Deficit 35.0$ 34.2$ 27.9$


Redline AGM 2012

Investor Relations

Transcript of Redline AGM 2012