LED Medical Diagnostics Inc TSXV: LMD / OTCQX:LEDID
FORWARD-LOOKING STATEMENTS The contents of this presentation are for information purposes only. This presentation is not to be construed as an offering of securities. Certain information contained in this presentation of LED Medical Diagnostics Inc. (the “Company”) constitutes “forward-looking statements“ within the meaning of securities laws. Actual events or results could differ materially from expectations and projections. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “outlook”, “objective”, “may”, “will”, “expect”, “intent”, “estimate”, “anticipate”, “believe”, “should”, “plans”, or “continue”, or similar expressions suggesting future outcomes or events. Forward-looking statements include, but are not limited to, statements regarding LED’s future plans, strategies, objectives, performance, revenues, growth, profits, operating expenses or LED’s underlying assumptions, LED’s plans to optimize current relationships and VELscope sales channels and LED’s intention to expand its technology beyond dental applications. Persons reading this presentation are cautioned that such statements or information are only predictions, and that LED’sactualfuture results orperformance maybe materially different. Factors that could cause actual events or results to differ materially from those suggested by these forward-looking statements include, but are not limited to: history of losses; the risk of material adverse effects in relation to a warning letter issued by the United States Food and Drug Administration, uncertainty of additional financing; third party product risks; regulatory risk; intellectual property risk; economic conditions; dilution; limited history of operations; operational risk; distributor risks; working capital; potential conflicts of interest; speculative investment; disruptions in production; equipment leases; reliance on key personnel and employees; seasonality; management’s estimates; development of new customers and products risks; stock price volatility risk; sales and marketing risk; competitors and competition risk; changes in barriers to entry for the market; regulatory requirements; reliance on few suppliers; reliance on subcontractors; operating cost and quarterly results fluctuations; fluctuations in exchange rates; fluctuations in interest rates; product liability and medical malpractice claims; access to credit and additional financing; taxation; market acceptance of LED’s products and services; customer and industry analyst perception of LED and its technology vision and future prospects; technological change, new products and standards; risks related to acquisitions and international expansion; reliance on large customers; concentration of sales; international operations and sales; management of growth and expansion; dependence upon key personnel and hiring; LED not adequately protecting its intellectual property; risks related to product defects and product liability; and including, but not limited to, other factors described in the preliminary short form prospectus and the documents incorporated by reference therein. In drawing a conclusion or making a forecast or projection set out in the forward-looking information, LED takes into account the following material factors and assumptions in addition to the above factors: LED’s ability to execute on its business plan; the acceptance of LED’s products and services by its customers; the timing of execution of outstanding or potential customer contracts by LED; the sales opportunities available to LED; LED’s subjective assessment of the likelihood of success of a sales lead or opportunity; LED’s historic ability to generate sales leads or opportunities; and that sales will be completed at or above LED’s estimated margins. This list is not exhaustive of the factors that may affect LED’s forward-looking information. Theseand otherfactorsshould be consideredcarefully and readers should not place unduereliance on suchforward-lookinginformation. Except as required by law, the Company disclaims any intention or obligation to update or revise the forward-looking information, whether as a result of new information, future events or otherwise. The forward-lookingstatementsin this documentareprovided for the limited purpose of enabling potential investors to evaluatean investmentin the securitiesof the Company. In this presentation, all references to dollars or“$” are to the lawful currencyof Canada and all amountsare in Canadian dollars, unless otherwise indicated. 2
WHO WE ARE LED Dental is a technology company that combines a unique offering of best in class dental imaging software and hardware device solutions andservices Proprietary technologies include: • Apteryx suite of open architecture imaging software systems • Industry's first cloud based SaaS imaging module • VELscope and TUXEDO sensor devices imaging devices The Company has experienced rapid growth since 2013 and the recent acquisition positions LED to become a leading player in the US dental imaging market 3
KEY INVESTMENT CONSIDERATION Dental technology company with significant opportunity for revenue, EBITDA and cash flow growth Recent transformative accretive acquisition adding thousands of dentist customers, extensive IP portfolio and patented imaging software suite Industry’s first affordable cloud based SaaS imaging module adding high value recurring revenue – key product in rapidly growing Dental Service Organizations (large group) market Market share growth to be driven by leveraging newly acquired customer base, SaaS based platform and unique blend of leading hardware solutions through established sales and marketing and distribution channels US market for dental digital imaging is world’s largest and growing with market estimated to exceed $1.7B by 2020 4
AN ENHANCED BUSINESS STRATEGY To leverage the Apteryx brand equity, user base and established distribution channels to drive software and image devicesales Align with large distribution partners for XV Web SaaS offering and device distribution bundle Rapid customer acquisition and recurring revenue addition through targeting DSO with dual offering 5
APTERYX OPEN SOFTWARE ARCHITECTURE 3rd Party Dental Practice Management Software 3rd Party Dental Imaging Hardware Devices Patented integration with wide variety of imaging devices and management software applications • 6
COMPETITIVE ADVANTAGES Proven management and software development teams in niche market Patent protected “capture to cloud” Picture Archiving System (PACS) offering available in dental industry at affordable subscription price Large “already digital” customer base Ability to leverage the joint sales, distribution and marketing efforts of both LED and Apteryx Ability to cross sell hardware and software products to dental practitioners and DSO’s “Open architected patented software solutions that integrate with a wide variety of imaging devices and dental management software systems Strong intellectual property portfolio - 28 issued digital imaging related patents 7
SALES & DISTRIBUTION Hybrid sales approach, direct and distributor sales model Sales teams can cross sell Apteryx Software with LED dental devices and products More attractive offering for customers for integration purposes and ease of use dealing with one vendor Apteryx software currently installed in tens of thousands of US dental offices – key relationships and trust established Targeting US based Dental Service Organizations (DSOs), currently representing 25% of dental offices and Dental Specialties (Ortho, Oral Surgery & Periodontics) 8
PRODUCT PORTFOLIO PATENTED PROPRIETARY PATENTED LICENSED • APTERYX • LED TUXEDO Sensor • VELscope Vx • RAYSCAN α • XrayVision • Next Generation • LED IC100 / IC200 DCV • Subscription Bundle • 3 ShapeTRIOS • XrayVision • XV Lite • XV Web 9
LED IMAGING ECOSYSTEM 3rd Party Service Providers Cloud Management Software Dental Lab Services Radiology / Oral Medicine Insurance • LED’s open architected “end to end” integrated imaging solution 10
HISTORICAL REVENUE GROWTH US$13.1M Current management joined in early 2014 and led consistent YOY growth US$10M US$9.0 M 2016 balance sheet weakness and focus on Apteryx acquisition impacted the year 2017 EXPECTING SIGNIFICANT BOUNCE BACK US$2.5M 2013 2014 2015 2016 2017 11
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