Gilat Satellite Networks Doron Elinav – VP Strategic Accounts April 2012 This presentation constitutes proprietary and confidential information of Gilat Satellite Networks Ltd. This presentation may not be disclosed, used or duplicated, in whole or in part, without the prior written consent of Gilat Satellite Networks Ltd. Confidential and proprietary information
Forward-Looking Statements This presentation contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are outside our control. These forward-looking statements include statements about our business strategy, objectives, and expectations, our future operating results, projections of capital expenditures, competitive pressures, revenues, growth prospects, product development, financial resources and other financial matters. The inclusion of forward-looking statements should not be regarded as a representation by us that any of our plans will be achieved. Actual results may differ materially from those set forth in this presentation due to the risks and uncertainties inherent in our business including, without limitation, slower than anticipated growth in the wireless communications markets; failure to win or maintain large-scale contracts; difficulties or delays in developing, producing and marketing new products, applications and services; competition from other network communications companies; our ability to control our expenses; and other risks detailed in the “Risk Factors” section of our latest Annual Report on Form 20-F. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement and we undertake no obligation to revise or update information herein to reflect events or circumstances after the date hereof. Information regarding market and industry statistics contained in this presentation is based on information available to us that we believe is accurate. It is generally based on industry publications and reports that are not produced for purposes of securities offerings or economic analysis. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. 2 Confidential and proprietary information
Gilat 1987 Confidential and proprietary information
Gilat Today… Vision: Lead the Satcom Industry with Innovative Commercial & Defense Products and Solutions, Enabling our Customers to Excel Growth Strategy: Ka-band broadband services SOTM for defense and homeland security Employees: ~1400 employees worldwide Financials: 2011 Revenues: $339.2M 2011 EBITDA: $33.5M Management 2012 Revenues: $340 - $350 million Objectives: 2012 EBITDA: 10% 4 Confidential and proprietary information
Annual Financial Indicators ($M) Annual Revenues Operating Income 17. 5 339.2 233.0 1.3 2010 2011 2010 2011 (6.2) 2010 2011 (12.3) GAAP Non GAAP EBITDA Backlog 33.5 264.6 232.1 14.2 2010 2011 2010 2011 Confidential and proprietary information
Worldwide Presence 5 R&D Centers; 6 NOCs (Network Operation Centers); Revenue Breakdown 20 Sales Offices 90 Countries APAC R&D Center 15% EMEA 430 networks USA & 9% NOC CAN 46% >1,000,000 VSATs shipped Sales office LATAM 30% 6 Confidential and proprietary information
Satellite Communications ● Satellite communication is growing – both in market size and importance ● DTH and an enabler for HDTV ● Satellite Radio ● Broadband satellite services ● NextGen Ka Band satellites are opening new markets ● Stronger and higher capacity, at relatively lower cost ● NBN Ka Band satellites are examples of this Confidential and proprietary information
Where is Satellite used? Some typical examples RF and Indoor unit antenna 8 Confidential and proprietary information Main antenna Hub
Where is Satellite used? Some typical examples ● Broadcast / Multicast ● Satellite TV ● Stock Market ● High availability ● Lottery ● Banking ● Ubiquitous Broadband ● Schools ● UAV ● Rapid deployment RF and Indoor unit ● Emergency response antenna ● Elections 9 Confidential and proprietary information Main antenna Hub
Ka Band Market Satellite Capacity by Band ● Typical spot-beam satellites cost $400M-$500M (vs $150M-$250M for traditional satellites) ● Spot-beam satellites provide 40Gbps-90Gbps (vs 2Gbps-6Gbps for Source: Comsys 2011 traditional satellites) Eutelsat’s Ka-SAT coverage ● Spot-beam satellites promise to drive growth by enabling capacity at about 1/10 th the cost of traditional capacity! Source: Eutelsat 10 Confidential and proprietary information
GESAC – bringing Internet to Brazil 11 Confidential and proprietary information
Russian Elections 12 Confidential and proprietary information
Strengths in the Commercial Market ● Focus on Technology and System Integration Consumer: Aries ● Solutions for Consumer, Enterprise, Government & Enterprise: WebEnhance ISP and Governments ISP and Trunking: Accent ● Focus on Emerging Markets ● Ka Band Solutions ● Leading Ka Band Technology ● Credibility ● Local presence and partnerships ● Flexibility and customization 13 Confidential and proprietary information
Why is Satellite used in Defense & Security? Some typical examples ● Provide Video from/to the battlefield ● UAVs and other sensors ● Real-time communication ● Network-Centric Warfare ● Tactical units need connectivity that radio cannot provide everywhere ● Independence from terrestrial networks ● Cannot depend on existing infrastructure ● Security ● Control over network Confidential and proprietary information
Israel Magen David Adom Exercise 15 Confidential and proprietary information
Fox News 16 Confidential and proprietary information
Gilat Colombia and Gilat Peru ● Peru ● Colombia ● 8,000 telephony and Internet Sites ● 2,000 telephony and Internet Sites ● Won School connectivity project and ● Won Fitel 10 ( $14.5 million) extensions of existing Compartel ● Project Implementation underway contracts ($34.5 million) to 770 communities ● Deployment of School connectivity project underway to 1600 schools Panama Panama 17 Confidential and proprietary information
USA Services Leadership ● Providing seamless End-to-End Services and Solutions ● Focused on Enterprise and Government ● Service to >130,000 sites ● High quality of service ● Highly reliable services ● Growth in Managed Network Services ● Technology agnostic broadband solutions ● Wins in the retail market: Dollar General ● Leveraging on CICAT acquisition 18 Confidential and proprietary information
Gilat and Australia 19 Confidential and proprietary information
Gilat in Australia ● Our local office was established in 1996 in Melbourne ● We employ Australian staff ● provide training overseas ● subcontract to local companies service ● Provide comms solutions to the Pacific ● Gilat value: improving the quality of life through affordable broadband service anywhere under the sky Confidential and proprietary information
Gilat in Australia We provide solutions to variety of customers: ● Consumer market – FRSS NBN (Interim), transitioning HIBIS \ABG customer base to higher speeds ● Emergency - Victoria Police, LSE, NSW-Fire Brigade, NZ IGNS ● Education - School of the air and DEET ● Corporate – FORD intranet, ● Optus is our biggest customer in the region ● Shipped >35,000 VSATs to date ● From Australian office, we support the Pacific region; Indonesia, Malaysia, Papua New Guinea, Fiji, etc… Confidential and proprietary information
Australian NBN Interim Satellite Service ● Agreement with Optus for Australian Government’s National Broadband Network Company’s Interim Satellite Service ● Optus Ku Band capacity and iPSTAR Ka/Ku Band multi-spot Australia: HiBIS installation beam capacity ● SkyEdge II VSAT network ● 11 hubs and 20k VSATs, to be deployed within 3 years ● Installation, operation and maintenance for 5 years ● Expansion of hubs and up to 48k VSATs - dependant on uptake ● Potential value up to A$120M 22 Confidential and proprietary information
Australian NBN Interim Satellite Service Ranch in Wallaloo – a suburb of Victoria One of the first pilot installations for NBN Co Collocated antenna in Kalgoorlie Hubs in Kalgoorlie Confidential and proprietary information
Why was Gilat chosen? ● Excellent product and technology ● Local presence – Australians working on the project ● Ability to work as a partner – Pre- NBN award… Optus and iPSTAR now staffing 24 people and growing ● Tight integration with Optus’s OSS/BSS system – Long lasting relationship between the companies ● Willing to set up local operations and take broader responsibilities ● Manage network and installations for Optus ● Relocation of experts from US to Australia Confidential and proprietary information
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