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TouchIT Technologies • MISSION STATEMENT - Our mission is simple: to manufacture interactive products which are accessible and an asset for every classroom or meeting room in the world-wide market place. Using the latest technology, we strive integrate our products seamlessly with your environment aiding your learning, development and growth. Key Dates :- Founded in September 2008 • January 2009 – launched and shipped of the TouchIT Board to world-wide markets • August 2009 – launch of the TouchIT Vote to world-wide markets • August 2009 – launch of the TouchIT Tablet to world-wide markets • November 2009 – launch of the TouchIT LCD samples into Key Customers in preparation for a January 2010 launch to world-wide markets • January 2010 – launch of 57” TouchIT LCD • May 2010 – TouchIT Technologies goes public in the USA – TUCN.OB
The Investment Opportunity • Public by reverse merger 12 May 2010 – TUCN.OB • 67.2m Shares Outstanding • $18m Market Cap (11/08/10) • $12.9m Public Float • 2009 Revenue $2m • Q1 2010 – 1.046m up 191% NET Income up 552% • Revenue goals 2010 - $5-7m • Revenue goals 2011 - $12m
About the Partners • Ronnie Murphy – ronnie@touchittechnologies.com • 15 years of International Sales experience • Former Head of World-Wide Sales for Zoom Technologies, Virtual Ink and Luidia (the two latter companies being Interactive Whiteboard Manufacturers) • 8 Years experience in the Interactive Whiteboard marketplace • AndiBrabin – andi@touchittechnologies.com • 6 years of International Sales experience • Former Head of European Sales for Luidia, manufacturer of the eBeam Interactive Whiteboards. • Strong technical and product design background • Multi-linguist • RecepTanisman • Founder and CEO of EmkoEmayewww.ee.com.tr • EmkoEmaye is a whiteboard manufacturer established for over 30 years • Largest importer of P3 Enamel Steel in Europe • 100 000 whiteboards / chalkboards sold per anum • Emko turns over $8-10m per anum • Strong manufacturing background with 35 years of experience • Strong manufacturing contacts
Today • Public company on the OTCBB – 100m shares authorised – TUCN.OB • Shares Outstanding – 67.2m • Insider Holdings – 48.3m • Company formed in a freeport (Free Trade Zone) in CatalcaIstanbul • Shell company TouchIT Technologies Inc, Nevada incorporated • Freeport Manufacturer’s licence granted • 3 Partners, 17 full time staff • 2000m2 of rented factory space
Company Structure TouchIT Tablet TouchIT Vote (Trading Licence) (Public Company – TUCN.OB) (100% owned subsidiaries) TouchIT Board TouchIT LCD (Manufacturing Licence)
Company Structure contd. Operating offices in Newburport, MA, USA – 10 staff in the office supporting 65 sales reps nationwide Rayleigh Essex, UK – 5 staff in the office Ballycullen, Co Limerick, Ireland – 1 person in the office These offices are not owned or paid for by TouchIT Technologies, the offices are our distribution partners that act as the manufacturer for legitimacy in entering large reselling accounts. They also provide local service and support as the manufacturer and give us a presence in the country.
Freeport Advantages Both companies are situated in a Freeport in Catalca, Istanbul • 100% corporate tax exemption for manufacturers • 100% income tax exemption for manufacturers • VAT exemption • Free profit transfer • The profits and incomes obtained can be transferred to any country freely within the Exchange Regulations without being taxed • Custom Tax exemption • The RUSF Exemption • The 3% Resource Utilization Support Fund that is applicable to imports • Cheap Energy • Electricity and fuel are exempt from tax • Minimum Bureaucracy
Our Markets (We take our products and put another company’s name or brand on them.) OEM Channel Distribution (We sell our products through a master distributor who supplies resellers in their territory/country)
Market Overview – Interactive Products 2010 and beyond Data from FutureSource Consulting Ltd – Q4 2009 Report – Colin Messenger Futuresource Consulting Ltd, Kensworth Gate, 200 - 204 High Street South, Dunstable, Bedfordshire LU6 3HS UK
Executive Summary • 2009 reached the goal of $1 billion Interactive Whiteboard sales and ended with 748k boards, 34% growth which was 2% above the Futuresource forecasts of 734k made one year ago. • There was activity in all regions with major growth in many countries across the world. • 12 countries sold more than 10k boards in the year, in 2005 there were only 3 countries • At 205k boards Quarter 4 had a 55% YoY growth. • 2010 sales forecast to be almost one million boards and there is a justifiably strong mood of optimism amongst manufacturers. • 2009 volumes have been increased in China as we have collected evidence of a larger number of manufacturers, they are concentrating on their home market but with aspirations of exporting. • BETT had more: exhibitors, exhibitor’s personnel, products, new product launches, International delegates and budgets to spend than ever before. • In USA there is still the impact of the Stimulus packages, some States have only spent 15% and are expected to spend the remainder in 2010. WORLD IWB Quarter Volumes Quarter 4 had a 55% YoY growth 11
World – IWB Overview Value - (Billion US$) Annual Sales (Millions) WORLD IWB Quarter Volumes • 2009 sales ended at 748k boards, 34% growth, a value of over $1Billion, 33% growth. • At 205k boards Quarter 4 had a 55% YoY growth. • 2010 sales forecast to be almost one million boards, a value of $1.34 Bn, 27% volume and value growth as increased short-throw shares provide stability to prices. • From recent research we have identified many IWB manufacturers in China, although most sell small volumes, collectively they have significantly changed the volumes of “other” brands in China, we have backdated this to the start of 2009.
Technology Status - Product Line • TouchIT Board – Interactive Whiteboard • TouchIT Vote – Audience Response System • TouchIT Tablet – Wireless Slate • TouchIT LCD - Interactive LCD
Technology Status - Product Roadmap Company Launch September 2008 TouchIT Board Samples November 2008 TouchIT Board Shipping January 2009 TouchIT Vote Shipping TouchIT Tablet Shipping August 2009 TouchIT LCD Samples TouchIT LCD Shipping TouchITWizteach Software Launched November 2009 January 2010 TouchIT Goes Public in the USA May 2010
Technology Status – www.touchittechnologies.com • The Website • Developed in house • Full online Support • Online Downloads software/updates • Reseller/Customer Area • Downloadable Voting Activities • Newsletter Manager • Video Demos • Video Tutorials • Online Lead Generation • Full Google analytics support • Twitter & Facebook • YouTube
Technology Status - Patents Pending • Provisional US patent filed • Filing Date: February 17, 2009 • Attorney Docket No.: 42270-101 • Design Patent also filed for the Interactive Whiteboard • Patent concerns the use of Infra-red touch technology on a porcelain enamelled steel surface to create an interactive whiteboard. • The novelty lies in the surface as no other interactive whiteboard manufacturer has made a touch-based porcelain enamel surface with IR
Product Cost Breakdown – Interactive Whiteboard (78”) • TouchIT Technologies owns the designs and the moulds for the Aluminium and IR Plastic. • Electronics (currently sourced from China) $235 • Surface (purchased from EmkoEmaye) $100 • Frame $5 • IR Plastic $6 • Fixings $1 • Packaging $35 • Stylus, Mounting, Instructions CD $4 • TOTAL $386 • Average Distribution Price $770 • Average OEM Price $680 • Distribution Profit Margin (Gross) • 50.13 % • $384 per unit • OEM Profit Margin (Gross) • 44 % • $304 per unit
Product Cost Breakdown – Voting System • TouchIT Technologies owns the handset design. The receiver and customised software are purchased from a Taiwanese vendor called GTC. The package is unique to TouchIT Technologies • Handsets $10.20 • Receiver $55 • Carry Case $12 • Packaging $15 • Distribution Pricing • 24 handset pack $699 (cost $326.80) • 32 handset pack $799 (cost $408.40) • OEM Pricing • 24 handset pack $649 (cost $326.80) • 32 handset pack $749 (cost $408.40) • Average Distribution Gross Margin • 49% • $381.40 per unit • Average OEM Gross Margin • 47% • $330 per unit
Product Cost Breakdown – 57” Interactive LCD • We’re purchasing pure components from Taiwan, using a Chi Mei (CMO) panel and sourcing the internal electronics though a first tier distributor. The frame and housing are designed and manufactured by TouchIT Technologies. • Freight & Customs $417.17 • Panel $1,300.00 • Back and Front $200.00 • Electronics IR $222.00 • Glass $35.00 • Internal Electronics $490.00 • packaging $50.00 • Contingency $50.00 • $2,764.17 • Average Distribution Price $3950 • Profit Margin Distribution & OEM (Gross) • 30 % • $1185 per unit
Product Cost Breakdown – TouchIT Tablet • We OEM this product from Taiwan. • Product Cost $ 43.60 • (Shipped to Istanbul) • Internal Freight $ 10.00 • Packaging/Rebranding $ 20.00 • Average Distribution Price $ 110 (Cost $73.60) • Average OEM Price $ 100 (Cost $73.60) • Profit Margin (Gross) • 33% • $36.40 per unit • OEM Profit Margin • 26.4% • $26.40 per unit
Product & Technology Roadmap • Currently we are purchasing our IR technology from a Chinese vendor • We have started to develop our own IR Touch Technology and the first production run happened June 2010 • We own the design to the technology, gerbers, BOMs • Our aim is to reduce our IR Electronics cost to circa $100 which is a reduction of $135 from our current cost (78”) • This would be a gross profit increase of 13% • This will be the same saving across the Interactive Whiteboard and the LCD range. • The Technology will be improved, support for 2 additional OS (Mac & Linux) will be added • Annotation software (proprietary) will be completed September 2010 we will have ownership of the code and the finished product • New LCD range to be launched September 2010
Intellectual Property Roadmap • In designing the new IR touch array, we will be looking into filing patents of the following • On board diagnostics for an Interactive Whiteboard • Web browser connection for technical support directly to the board • Power-on self testing for an Interactive Whiteboard. • For the LCD we will be filing the following • Design patents on the frame and housing • Patent on the IR mounting mechanism
Current Financials - Revenue 2009 revenue hit $2m 2010 forecasted $5m – NET Income of $60k shown Q1 2010 2011 forecasted $12m
Justification for revenue increase Revenue forecasts have not taken into account the significant upside that a tender opportunity would create. We are aware of the following and are already in the mix • Tender Kuwait 2010 – circa 1000 units • Tender Italy 2010 – circa 2000 units • Tender Brazil 2010 – circa 10 000 units Other factors that will influence growth are • Cleverboard Dual expansion throughout Europe • New OEM opportunities in the Middle East and South Africa • Expansion into Australasia • Opening up new distribution networks throughout the world • Growth of the US market with increased presence for TouchIT Technologies
Plans for Growth – Overview on where the investment is going / has been spent • Increased liquidity in the business • We have the funds to keep up with demand for product • Increased inventory holding • Sales and Marketing Programs • $2m of revenue in 2009 was achieved with little to no marketing and limited travel to see customers • We will attend more tradeshows to increase the customer base and awareness of the products • We have a travel budget for visiting customers • Factory & Staff Development • In order to build the LCDs efficiently, we are changing the factory environment to a more electronics-based environment (Completed July 2010) • We have started to increase the workforce to speed up production • We plan to hire an in-house software development team • We are increasing the engineering/product development efforts • We have begun increasing the sales team (US Sales Manager Starts September 1 2010)
