Energy Focus, Inc. · NASDAQ:EFOI
Energy Focus — Investor Presentation (May 2022)
24 slides from Energy Focus's investor presentation, May 2022
Slide 1: Investor Presentation
Investor Presentation Energy Focus, Inc. May 2022 © Energy Focus, Inc. 1
Slide 2: Forward Looking Statements
Forward Looking Statements Forward-looking statements in this presentation are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements can generally be identified by the use of forward-looking terminology, including the terms “believes,”
Slide 3: Cutting Edge Technology for the Lighting Market
Cutting Edge Technology for the Lighting Market Innovator of LED lighting technologies and solutions: Military - Proven track record for superior quality and innovation in LED since 2004 Specialty Standard - Marquee enterprise customers, including U.S. and foreign military, U.S. Maritime government,
Slide 4: Senior Leadership
Senior Leadership Stephen Socolof, Interim Chief Executive Officer Glenn Potter, VP of Operations • Experienced venture capitalist • 25 years in operations management in the electrical • Managing Partner of Tech Council Ventures and hydraulic manufacturing industries • 25 years investing in enterpri
Slide 5: Board of Directors Includes Strong Recent Adds
Board of Directors Includes Strong Recent Adds Jeff Parker, Independent Director Brian Lagarto, Independent Director • 30 years managing LED companies in the display, • Retired EVP & CFO of SharkNinja Operating LLC, a leading lighting, and medical markets global producer of small household appliance
Slide 6: At the Forefront of Lighting Evolution
At the Forefront of Lighting Evolution Lighting industry is transitioning to new platform of full-spectrum controllability and multi-purpose functionality 2017: Energy Focus remains at the forefront of development Energy Focus launches RedCap Emergency battery 2007: backup line 1st Energy Focus 2003
Slide 7: Critical Installations for a Variety of Use-Cases
Critical Installations for a Variety of Use-Cases Military (MMM) Commercial Healthcare Education Energy and maintenance savings, LEDs replace linear fluorescents Environmental sustainability, Quality of lighting and low flicker and improved quality of lighting which quickly burn out and change quali
Slide 8: Smart Lighting & Wellness Lighting to Emerge & Grow Rapidly
Smart Lighting & Wellness Lighting to Emerge & Grow Rapidly Estimated Market Sizes 2021-2027* Current Market Opportunity $ Billions • Covid slowed adoption over the past two years • Expect penetration to accelerate $27 • Significant greenfield opportunity (75% of the total market) $11 $6 $1 2021 202
Slide 9: Post-Pandemic Construction Upturn
Post-Pandemic Construction Upturn Commercial Construction Starts in Energy Focus Target Sectors Are In Upswing. Significant Increases Forecast in Years 2023- 2026 9 © Energy Focus, Inc.
Slide 10: Go-forward Strategy Commercial Lighting Market
Go-forward Strategy Commercial Lighting Market • Enhanced and expanded commercial lighting portfolio encompassing both LED tubes and fixtures • Improved sourcing and quality assurance across all product lines • New products for military and industrial applications • Broadened application for EnFocus
Slide 11: Growing Portfolio Of Advanced Products Planned to Launch
Growing Portfolio Of Advanced Products Planned to Launch September 2022 Q1 2023 JJune 2022 Enhanced Version of EnFocus 2.0 Fully Updated Line of Successful REDCAP Title 24 Compliant Commercial LED Emergency Lighting Powerline Control Tubes and Fixtures Solution System July 2022 August 2022 September
Slide 12: EnFocus Groundbreaking HCL Control Platform
EnFocus™ Groundbreaking HCL Control Platform • No additional control wires • No wireless connections • Simple, secure, cost effective, turnkey lighting control system • Market opportunity to interface with all 0-10v commercial lighting fixtures • EnFocus help usher in and foster adoption of control
Slide 13: Circadian Lighting Influencers
Circadian Lighting Influencers Features Benefits Sleep: “Students exposed to Human Centric Lighting, Stan 2/3 of adults fail to obtain lighting with higher light Walerczyk, CLEP, LC, the recommended intensity and light https://humancentriclighting.or temperature levels had, by g/wpcontent/uploads/20
Slide 14: Bringing Circadian Powerline Control to Existing Buildings & Homes
Bringing Circadian Powerline Control to Existing Buildings & Homes for the First Time • The most sustainable • Much lower cost and affordable lighting to install than control solution versus • Simple retrofit other wired or other LED alternatives. • Network safe and installation, with wireless dimmi
Slide 15: Improving Market Channel Penetration
Improving Market Channel Penetration Commercial Channel Expanding existing agency coverage to handle Southwest and Central US states Hiring new agencies for deeper coverage into Northeast, Northwest and Northern CA Military Channel Addition of Senior Director for Government Sales
Slide 16: Finally, Redoubling Cost-Out Initiatives
Finally, Redoubling Cost-Out Initiatives • Aggressively pursuing cost reduction opportunities above and below the line to improve margins and reduce SG&A • Headquarters/plant footprint trimmed effective 7/1, reducing annual rent costs by ~$415k annually • Logistics optimization expected to lower fre
Slide 17: Financials
Financials 17
Slide 18: Revenue
Revenue Recovery from pandemic slower than expected; New products launched in early 2022 $ in millions Net Sales $6.0 $3.8 $3.7 $3.3 $2.6 $2.7 $2.4 $2.1 $2.1 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Commercial Military © Energy Focus, Inc. 18
Slide 19: Expenses and Adjusted EBITDA
Expenses and Adjusted EBITDA New leadership has restructured organization $ in millions Adjusted EBITDA Operating Expenses (Net loss excluding restructuring, interest, gain on forgiveness of PPP loan, loss on extinguishment of debt, depreciation and amortization, stock-based compensation, change in
Slide 20: Net Inventory (After Reserves)
Net Inventory (After Reserves) Significant Assets to Convert to Cash With Improved Sales Execution $8,129 $7,755 $7,866 $7,515 $7,367 $5,641 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 © Energy Focus, Inc. 20
Slide 21: Summary Balance Sheets
Summary Balance Sheets As of As of ($ in thousands) 3/31/2022 12/31/2021 Cash $225 $2,682 Capital Structure Total current assets $10,532 $13,424 (as of March 31, 2022) Total assets $12,549 $14,391 Total current liabilities $7,936 $8,156 Total liabilities $9,117 $8,182 Stockholders’ equity1 $3,432 $6
Slide 22: Thank You!
THANK YOU! Energy Focus, Inc. © Energy Focus, Inc. 22
Slide 23: APPENDIX - Adjusted EBITDA Reconciliation
APPENDIX - Adjusted EBITDA Reconciliation As of As of As of As of As of As of As of As of As of As of ($ in thousands) 12/31/19 3/31/20 6/30/20 9/30/20 12/31/20 3/31/21 6/30/21 9/30/21 12/31/21 3/31/22 Net Loss $ (1,308) $ (541) $ (4,340) $ (1,165) $ 65 $ (1,642) $ (2,473) $ (1,140) $ (2,631) $ (2,8
Slide 24: APPENDIX – Total Availability Reconciliation
APPENDIX – Total Availability Reconciliation As of As of As of As of As of As of As of As of As of As of ($ in thousands) 12/31/19 3/31/20 6/30/20 9/30/20 12/31/20 3/31/21 6/30/21 9/30/21 12/31/21 3/31/22 Total borrowing capacity under credit facilities $ 2,407 $ 2,025 $ 2,566 $ 4,577 $ 4,121 $ 4,25