GILAT SATELLITE NETWORKS COMPANY OVERVIEW February 2019 NASDAQ, TASE: GILT
FORWARD LOOKING STATEMENTS DISCLAIMER Certain statements made in this presentation that are not historical are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. The words "estimate", "project", "intend", "expect", "believe" and similar expressions are intended to identify forward- looking statements. These forward-looking statements involve known and unknown risks and uncertainties. Many factors could cause the actual results, performance or achievements of Gilat to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic and business conditions, inability to maintain market acceptance to Gilat's products, inability to obtain financing and/or timely develop and introduce new technologies, products and applications, rapid changes in the market for Gilat's products, loss of market share and pressure on prices resulting from competition, introduction of competing products by other companies, inability to manage growth and expansion, loss of key OEM partners, inability to attract and retain qualified personnel, inability to protect the Company's proprietary technology and risks associated with Gilat's international operations and its location in Israel. Gilat undertakes no obligation to update or revise any forward- looking statements for any reason. For additional information regarding these and other risks and uncertainties associated with Gilat's business, reference is made to Gilat's reports filed from time to time with the Securities and Exchange Commission. Unaudited/Non-GAAP Financial Measures This presentation includes financial data that is not audited and financial data that was not prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP). Non-GAAP financial measures appearing in this presentation consist of GAAP financial measures adjusted to exclude, non cash share-based compensation expenses, impairment of goodwill and long lived assets, amortization of acquired intangible assets, restructuring, trade secrets litigation expenses, tax expenses under amnesty program, deferred tax benefit that was recorded for the first time and other non-recurring expenses and net income or loss from discontinued operations. Gilat believes these non- GAAP financial measures provide consistent and comparable measures to help investors understand Gilat ’ s current and future operating performance. However, our non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read in conjunction with Gilat ’ s consolidated financial statements prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies. 2 | Proprietary and Confidential
GILAT – BOUNDLESS COMMUNICATIONS 4G/5G 2G/3G Air Sea Land Consumer Enterprise MOBILE MOBILITY BROADBAND GLOBAL PRESENCE MOST ADVANCED TECHNOLOGY END-TO-END SERVICE 20 sales offices Terrestrial-grade user experience Most stringent service levels Established 1987 NASDAQ / TASE: GILT ~1,100 employees 3 | Proprietary and Confidential
GLOBAL FOOTPRINT – EXPANDING A DIVERSE CUSTOMER BASE SATELLITE OPERATORS CARRIERS & SERVICE PROVIDERS SYSTEM INTEGRATORS GOVERNMENTS 300+ customers 500+ Networks 90+ countries 4 | Proprietary and Confidential
BOOMING CAPACITY – GEO + LEO/MEO Global HTS Bandwidth Supply, Demand and Price per Mbps $/Mbps/Month Gbps 1,000 1,000 20,000 10,000 900 900 18,000 9,000 ~16 times today 800 800 8,000 16,000 700 700 7,000 14,000 ABUNDANCE 600 12,000 600 6,000 OF CAPACITY 500 500 10,000 5,000 UNLOCKS 400 400 8,000 4,000 NEW MARKETS 300 6,000 300 3,000 200 200 4,000 2,000 100 100 2,000 1,000 - 0 - 0 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 GEO-HTS Global Demand GEO-HTS Global Supply GEO-HTS Global Demand GEO-HTS Global Supply Weighted Avarage GEO-HTS Price Non-GEO HTS Global Supply Weighted Avarage GEO-HTS Price Source: Euroconsult, NSR, 2017 5 | Proprietary and Confidential
AFFORDABLE INTERNET EVERYWHERE IS BECOMING A “ BIRTH RIGHT ” WE ALL WANT BROADBAND WE ALL WANT BROADBAND SATELLITE DELIVERS Everywhere. Anytime. Affordable. Everywhere. Anytime. Affordable. Affordable, Plentiful, Terrestrial-grade User Experience Mobile Mobility Broadband 6 | Proprietary and Confidential
ACCELERATING CONNECTIVITY – GROWTH AREAS Mobile Mobility Broadband Cellular Backhaul, Broadband to the In the Air, at Sea, on the Ground Network Resilience, Public Safety Unserved and Underserved 7 | Proprietary and Confidential
MOBILE 8 | Proprietary and Confidential 8 | Proprietary and Confidential
LEADING THE FAST GROWING SATELLITE BACKHAUL MARKET Satellite Backhaul Market $3,300M “ Gilat continues to unlock new opportunities and capture a bigger share of the pie …” (2027) Source: NSR, April 2018 $790M (2017) 9 | Proprietary and Confidential
ENABLING “ TERRESTRIAL-GRADE ” USER EXPERIENCE Affordable true LTE Backhaul Global End-to-End Services Delivering “ terrestrial-grade ” User Experience Delivering comprehensive services Rapid network deployment Expertise in integrating ground and sat networks Experience with Tier-1 MNOs worldwide Expanding coverage to: rural, highways, islands, tourist centers, campuses, metro-edge and metro areas Generating recurring revenues Replacing leased lines and upgrading T1s/E1s 10 | Proprietary and Confidential
WORLD ’ S FASTEST BROADBAND FOR LTE BACKHAUL 11 | Proprietary and Confidential 11 | Proprietary and Confidential
METRO AREA - A LIVE EXMPLE 12 | Proprietary and Confidential 12 | Proprietary and Confidential
MOBILITY 13 | Proprietary and Confidential 13 | Proprietary and Confidential
MOBILITY – SUPERIOR PASSENGER EXPERIENCE DRIVES DEMAND Satellite Broadband Connected Aircrafts Commercial Aircrafts Business Aircrafts 27,800 8,800 (2027) (2027) 5,200 500 (2017) (2017) Source: EuroConsult, July 2018 Source: EuroConsult, July 2018 14 | Proprietary and Confidential
DELIVERING SUPERIOR PASSENGER EXPERIENCE >2,200 aircrafts World ’ s Fastest Speed In-Flight Connectivity One Network Global Coverage Over 25 Satellites 15 Teleports 15 | Proprietary and Confidential
Leading Performance Solutions for All In-Flight Connectivity Modules Dual Band 400Mbps Ku/Ka Antenna Modem ESA/PAA Ku and Ka Transceivers 16 | Proprietary and Confidential 16 | Proprietary and Confidential
BROADBAND 17 | Proprietary and Confidential
DELIVERING CORE INFRASTRUCTURE FOR NATIONAL BROADBAND Broadband to unserved & underserved NBN Gazprom Connecting nationwide Providing broadband Bridging the digital divide businesses and connectivity across Connecting communities and individuals to the world enterprises in Russia over new satellite – via broadband regional and rural Australia Yamal 601 Ka Innovating to deliver plentiful affordable Consumer and Enterprise solutions China Satcom JSAT Extending satellite coverage Delivering wide range of Large governmental projects in Peru and Colombia throughout China with new mobility and fixed satellite – CS-18, broadband Peru – FITEL projects sole solution to applications China ’ s HTS Ka in Japan o A $2B+ program to build terrestrial networks across Peru 14 Regional Projects awarded so far – o ISRO 6 to Gilat (~$548M) Boosting broadband – ~$333M construction revenue connectivity across India ’ s – ~$215M operational revenue over 10 years mainland and islands o Target: over new satellite – Recurring revenues >$50M / year, profitable, starting 2020 ISRO ’ s GSAT-11 18 | Proprietary and Confidential
NGSO 19 | Proprietary and Confidential
CONSTELLATIONS AND NETWORKS ARE GETTING MORE COMPLEX Multi-satellite Multi-orbit Multi-beam Multi-band 1K-10K/constellation GEO/MEO/LEO Thousands per satellite Ku, Ka, C GEO 35,786 km GEO MEO MEO 2,000-10,000 km LEO LEO 500-2,000 km Next-Gen Technologies Needed – Complex NMSs, Strong Modems, ESA 20 | Proprietary and Confidential 20 | Proprietary and Confidential
NGSO IS MATERIALIZING Several constellations in advanced stages: SpaceX, OneWeb, Telesat, mPower O3b mPO mPOWER WER Gilat involved in a number of them Opportunity is both baseband as well as ESA antennas o IFC demo – Telesat/GEE o Maritime connectivity demo – Telesat/Tier-1 Maritime service provider 21 | Proprietary and Confidential
5G-READY SATELLITE SOLUTION Service to regions without terrestrial network Service Ubiquity e.g. rural/remote, public safety, disaster, IoT Continuity between terrestrial and satellite networks Service Continuity e.g. aero, maritime, land Media service Service Scalability e.g. global feed, video backhaul 22 | Proprietary and Confidential
FINANCIAL INDICATORS AND ANALYSIS 23 | Proprietary and Confidential 23 | Proprietary and Confidential
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