Itex Corp. · OTC:ITEX
Itex — Investor Presentation (November 2010)
32 slides from Itex's investor presentation, November 2010
Slide 1: Investor Presentation
. Investor Presentation November 2010 1
Slide 2: Forward-Looking Statements and Solicitation Materials
Forward-Looking Statements and Solicitation Materials ITEX Corporation urges caution in considering its current trends and any outlook on earnings disclosed in this communication. In addition, certain matters discussed may constitute forward-looking statements. These forward-looking statements invol
Slide 3: About ITEX
About ITEX Symbol ITEX.OB Recent Price $4.75 52 Week Range $3.40- $5.50 Shares Outstanding 3.6 M Market Capitalization $17.1M Institutional Ownership ~20% Insider Ownership ~17% Fiscal Year End July 31 Revenue - 2010 $16.925M Cash Flow From Operations - 2010 $2.536M 3
Slide 4: Cashless Exchange Industry
Cashless Exchange Industry • $1.4B transaction value via local exchanges • 250 exchanges • Fragmented industry • 200,000 member companies • IRS codifies tax treatment in 1982 and requires 1099-B reporting Source – Estimates based on ITEX’s information and belief 4
Slide 5: ITEX Overview
ITEX Overview • Largest* membership B2B Trading Community in the United States and Canada • 24,000 members • Customer service provided by franchised Broker Network • Enables members to attract new customers and generate incremental sales • Members buy and sell within the Trading Community utilizing
Slide 6: Craigslist Barter Section
Craigslist Barter Section • Wed Oct 14 • 12 chocolate on chocolate cupcakes in antioch - (pittsburg / antioch) • Need keys for your Car..House..office ect - • A-1 Cabinet Maker/Remodel/Repair/New/Vanity Master - $1 - (santa rosa) • Kettle One Citroen - (mission district) pic • machanic for ford wago
Slide 7: Craigslist Barter Listing
Craigslist Barter Listing • Canon 40D, like new + 2GB compact flash (Renton) • Reply to: [email protected] [?] Date: 2010-10-14, 1:02PM PST I'd like to trade my year and a half old Canon 40D body. Like new condition. Always kept in a Crumpler bag, no scratches, etc. Includes box, manuals
Slide 8: ITEX Marketplace Listing
ITEX Marketplace Listing et Explorer provided by Dell http://www.itex.com/marketplace/ cs | Links | Personal ) Customize Links [4 Dashboard - Google Analy... |< > ITEX > > Marketplace > [ep Page ~ QT ITEX Username: ITEX Marketplace >> Search Join now! Forgot password? Login hetp? Introducing ITEX IT
Slide 9: Marketplace Detail
Marketplace Detail Ele Linke Links Pevronal Customize Linke Sy a 7 coolers “meeaatennanee ae) a Marketplace >> Listings >> Hilton Hotel Costa Mesa Introauing TEX ITE esi Servies Executive MBER (> ton Hotel Costa Mesa Teche © Conse information GS ‘Youmunt Sg inthe Community to vew e's conact Recent L
Slide 10: ITEX Member Benefits
ITEX Member Benefits • Obtain new customers • Utilize unique sales channel • Cash conservation by purchasing with ITEX dollars • Monetize unproductive assets, excess capacity and inventory • Broker Network for transaction support • Customer loyalty and retention 10
Slide 11: ITEX Community in Action
ITEX Community in Action Media Purchases hotel accommodations for sales promotions and business cards and stationery from a printer. Resort Hotel Hires contractors to expand and upgrade their facilities. General Contractor Trades for dental services for staff and purchases direct mail advertising, F
Slide 12: Member Example - Seattle Dentist
Member Example - Seattle Dentist Accepted ITEX $ from: Paid ITEX $ for : • CPA • Printing • Contractor • Auto detail • Advertiser • Flowers • Moving Company • Accommodations Total Sales: $47,367 Avg Transactions: 22 Total Purchases: $41,559 Avg Volume: $9,814 Total Cash Fees: $ 6,289 Avg Client: 6 y
Slide 13: ITEX Competitive Advantages
ITEX Competitive Advantages • Membership critical mass • Customer service capability • Products / services depth and diversity • Brand recognition and currency liquidity • Web based trading platform • Established Infrastructure 13
Slide 14: Transaction Methods
Transaction Methods 2) Online Capability 3) Automated Authorization Line – 1.800.426.5777 14
Slide 15: Member Account Statement
2926 160th Ave. SE Suite 100 Bellevue, WA 98008 wermeweitex.com STATEMENT ITEX Contact: JOHN Q. CITIZEN WORLDWIDE MARKETING 123 BUSINESS DRIVE SACRAMENTO, CA 95825 $15,184.12 500.00 Opening Balance: Sales: S$ Purchases: $ 2,010.00 Closing Balance: $13,674.12 RETAIN THIS STATEMENT FOR TAX PURPOSES ‘S
Slide 16: Member Products & Services
Member Products & Services • Accommodation & Travel • Retail – gifts, florists • Advertising & Media* • Architects & Design • Business Products/Services* • Consultants • Contractors • Restaurants • Professional Services • Entertainment* • Business Equipment • Printing • Real Estate & Related • Magaz
Slide 17: ITEX Strategic Objectives
ITEX Strategic Objectives • Establish the ITEX trading platform as the standard for B2B cashless transactions • Market penetration into the 25 million small businesses in the United States* • Brand recognition of ITEX dollars • Enhance, create and manage Marketplace Rules for the Trading Community •
Slide 18: ITEX Growth Opportunities
ITEX Growth Opportunities • Organic Growth • Increase transaction volume through registration growth • Increase number of locally owned offices • Supplement primary franchise system with online marketplace • Licensing • ITEX SaaS Platform - Powered by ITEX • SuperMedia’s Super Trade Exchange • Latin
Slide 19: Software as a Service (SaaS)
Software as a Service (SaaS) • Scalable platform technology • CRM • Payment processing • Record keeping • Billing functionality • Reports • Track digital currency; with any value • Calculates transaction or subscription fees in USD • Windows web-based platform • Co-location & backup data facility 19
Slide 20: Testimonials
Testimonials "ITEX has helped me connect with the exact customers we want -from Florida to California - that we wouldn't have had any other way. ITEX has also helped us pay for real business expenses with ITEX dollars instead of cash." - Nick Owner of a commercial printing business "Not only have we
Slide 21: Discover an innovative way to survive
Discover an innovative way to survive “Trading products and services is the PERFECT way to increase sales and improve your bottom line.” - Steven White, CEO, ITEX Corporation With the current economic uncertainty, your business can use barter to attract new customers and retain current ones. /TEX —
Slide 22: Revenue
Revenue tl WIE Titi 2003 2004S 00 00s C($:séiB 2009 = 2010 i $10,595 $10,283 $10,225 $14,646 $14,171 $15,964 $16,502 $16,925 22
Slide 23: Revenue Breakdown and Costs
Revenue Breakdown and Costs • Transaction fees: 67% • 5% to 7.5% of ITEX dollar transaction amount (assessed to buyer and seller) • ITEX retains 25%, balance to Broker • Subscription fee: 28% • $20 per member every four week billing cycle • ITEX retains 65%, balance to Broker • Other fees: 5% 23
Slide 24: Cash Flow & Income From Operations
Cash Flow & Income From Operations 2008 2004 2005 2006 2007 2008 2009 2010 CashFlow —$(74) $28 $843 $1,836 = $2,057 $2,374 «= $2,875 = $2,536 Income $(642) $621 $729 $1,341 $1,505 $1,501 = $1,027 «$1,674 24
Slide 25: Balance Sheet 7/31/2010
Balance Sheet 7/31/2010 Assets: Cash & ST Investments $ 5,169,000 Accounts receivable, net 859,000 Tax asset 6,018,000 Goodwill 3,282,000 Notes receivable (office sales) 605,000 Other assets & equip. 1,685,000 Total Assets $17,638,000 Liabilities & Shareholder Equity: Broker commissions $ 1,450,000
Slide 26: Stockholders' Equity & Cash Balance
Stockholders’ Equity & Cash Balance $15,000 $12,000 $9,000 $6,000 $3,000 $0 2003 = 2004 »=— 20052006 «20072008. 2009010 Equity $(481) $2,227 $4,969 $7,968 $12,330 $13,319 $13,981 $14,869 Cash $104 $215 «$569 $314 $1,753 $1,061 $2,557 $5,169 26
Slide 27: Stock Price
Stock Price $5.00 $4.00 $3.00 $2.00 $1.00 | — : | E $ 00 nil EGER ER ED. 2003 ~=—«-2004 = (2005 «= «2006 «= «2007«Ss«2008-_~«Sséi«é09——Ct«é $60 $1.05 $1.90 $288 $4.00 $440 $315 $4.75 27
Slide 28: Stock Price Compared to S&P 500
Stock Price Compared to S&P 500 28
Slide 29: Management Team
Management Team Years in Name Title Prior Experience Industry Steven White Chairman/CEO/CFO Ubarter.com, 26 Network Commerce Robert Benson VP Operations Ubarter.com, 17 Network Commerce Brian Argetsinger VP Marketplace ITEX Franchisee 17 Douglas Dagenais National Sales Chicago Barter 24 Shell Vacati
Slide 30: Reasons to Invest
Reasons to Invest • Industry leader with attractive growth potential • Strong cash flow • Scalable business model • Proprietary SaaS technology • Unique distribution channel and community • Intrinsic value of membership network 30
Slide 31: Investor Presentation November 2010
. Investor Presentation November 2010 31
Slide 32: 32
32