aivtech international group (otc: ecoh; twitter: $ecoh) - 2010 fye presentation
DESCRIPTION
AIVtech International Group (OTC: ECOH; Twitter: $ECOH) focuses on the integration of electronic products, such as multimedia speakers and video games, with furniture and has coined the term "electronic furniture" to describe its products.TRANSCRIPT
AIVTECH INTERNATIONAL
GROUP CO.
(OTC BB: ECOH)
April 2011
1
2010 YEAR END
CONFERENCE CALL
Safe Harbor Statement
Safe Harbor Statement for Purposes of the “Safe Harbor” Provisions of the Private Securities Litigation Reform Act of 1995: This presentation contains “forward-looking” statements, which are not historical facts, but are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Management may make additional forward-looking statements in response to your questions today. Therefore, the company claims protection under Safe Harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ from results discussed today and, therefore, we refer you to a more detailed discussion of these risks and uncertainties in the Company’s filings with the SEC. In addition, any projections as to the Company’s future performance represented by management include estimates today, as of April 13, 2011, and the Company assumes no obligation to update these projections in the future as market conditions change.
2
2010 Year in Review3
• Founded in 2004; publicly traded under symbol ECOH in May 2010
• Provider of originally designed consumer electronics products through 3 product lines; ~80 products in total 1. High-quality Audio Furniture, 2. Multimedia Speakers , 3. Video Products
• 30,000 sq. meter manufacturing facility in Dongguan, Guangdong Province
• 50 R&D team members
• Growth opportunity New and innovative products: Interactive Intelligent Panel/Electronic Restaurant Menu
Audio Furniture Opportunity in China
• 2010 Financial highlights: Revenue ▲ 77.6% to $68.3 million; Net income ▲ 47% to $11 million
• 2011 Net income guidance: $13.7 million or $0.61/share
Our Products4
Audio Furniture Multi-Media Speakers Video Products
Product Pipeline: Interactive Intelligent Panel & Electronic Menu
2010 Revenue Breakdown5
Audio Furniture 60.6%
Video Products
26.1%
Multi-Media Speakers
13.3%
Yr Ended Dec. 31st 2009 % of Sales 2010 % of Sales YOY % GPM
Audio Furniture $30.8M 80.2% $41.4M 60.6% ▲ 34.3% 26.3%
Multimedia Speakers $7.6M 19.8% $9.1M 13.3% ▲ 19.1% 25.5%
Video Products $ - - $17.8M 26.1% - 14.9%
Total $38.5M $68.3M ▲ 77.6% 23.2%?
High-Quality Audio Furniture6
• ODM Business Model: Primary supplier of value added
electronic components Distribution: Ace Bayou in New Orleans Retail stores: Wal-Mart, Target
Brands: “X Rocker” and “V Rocker” Retail price: $100-$200
• 12 models; several prototypes in pipeline
• 4 types of chairs: Gaming chair - Award winning; PS and
Xbox compatible Music chair IT chair Health chair
• Growth: Establish distribution in China
Multimedia Speakers7
• ODM/OEM business model
20 distributors
100% sold in China, 50% of which
under AIV brand
• Broad product base, 41 products
Notebook/PC, channel speakers,
wireless speaker kit, Digi Panda
• 26% - gross margins
• Retail price: $6-$60
Video Products8
• LED Backlit TV’s
ODM business model
Established customer relationships with European brands: ALDI, Dixons, Qmedia
2 distributors in Germany and Belgium
• Launched in April, 2010
• 26% total revenue during 2010
• New Products with Higher Margins Interactive Intelligent Panel
Electronic Menu
Electronic Mahjong System
30,000 Sq. Meter Facility9
Dongguan, Guangdong Province
Income Statement10
Net sales $ 68,334,543 $ 38,469,185
Cost of sales (52,459,912) (28,064,339)
Gross profit 15,874,631 10,404,846
Operating expenses
Selling expense (741,738) (644,757)
General administrative expenses (2,146,465) (1,433,254)
Total operating expenses (2,888,203) (2,078,011)
Income from Operations 12,986,428 8,326,835
Other income ( expenses)
Change in fair value of warrants liability 122,795 -
Interest income 20,755 9,834
Interest expense (19,607) (30,079)
Total other income (expense) 123,943 (20,245)
Income before income tax 13,110,371 8,306,590
Provision for Income taxes (1,715,218) (830,659)
Net income 11,395,153 7,475,931
Less: Net income attributable to non-controlling interest 406,162 -
Net income attributable to AIVtech International Group Co. $ 10,988,991 $ 7,475,931
Net income 11,395,153 7,475,931
Foreign currency translation adjustment 342,496 (4,348)
Comprehensive income 11,737,649 7,471,583
Comprehensive income attributable to non-controlling interest $ (102,749) $ 1,304
Comprehensive income attributable to AIVtech International Group Co. $ 11,634,900 $ 7,472,887
Basic and diluted income per common share
- basic $ 0.66 $ 0.72
- dliuted $ 0.66 $ 0.72
Basic and diluted weighted average common shares outstanding
- basic 16,566,205 10,375,000
-dliuted 16,568,189 10,375,000
Cash dividend per common share 0.27 0.85
2010 2009For the year ended December 31,
Revenue/Net Income Growth11
0
10
20
30
40
50
60
70
2007 2008 2009 2010
Revenue ($ in millions)
68.0%
CAGR
0
2
4
6
8
10
12
2007 2008 2009 2010
Net Income ($ in millions)
82.8%
CAGR
$14.4
$20.7
$38.5
$68.3
$1.8
$3.9
$7.5
$11
2010 Highlights
• Revenue of $68.3 million, up 77.6% YOY
• Gross profit of $15.9 million, up 52.6%
• Operating income of $13 million, up 56% YOY
• Net income of $11 million, up 47% YOY
Balance Sheet12
CURRENT ASSETS:
Cash $ 7,079,221 $ 3,605,741
Accounts receivable 7,192,694 2,040,088
Other receivable and prepaid expense 198,553 42,121
Inventories 571,602 5,073,436
VAT tax recoverable - 845,203
Total current assets 15,042,070 11,606,589
Property and equipment, net 1,127,334 1,015,570
TOTAL ASSETS $ 16,169,404 $ 12,622,158
CURRENT LIABILITIES
Account payables and accrued expense $ 962,099 $ 5,973,299
Taxes payable 785,636 536,101
Due to related parties 529,166 29,252
Dividend payable 3,948,125 -
Warrants liability 299,492 -
Total current liabilities 6,524,518 6,538,651
Long term loan 757,311 -
TOTAL LIABILITIES 7,281,829 6,538,651
STOCKHOLDERS' EQUITY
Common stock, $.001 par value, 75,000,000 shares authorized, 22,513,334 and
10,375,000 shares issued and outstanding as of December 31, 2010 and 2009,
respectively
22,513 10,375
Additional paid-in capital 7,566,593 631,541
Stock subscription receivable (7,540,002) -
Statutory reserve 482,377 346,991
Retained earnings 6,773,472 4,260,636
Accumulated other comprehensive income 737,196 394,700
8,042,149 5,644,243
Non-controlling interest 845,426 439,264
Total stockholders' equity 8,887,575 6,083,507
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 16,169,404 $ 12,622,158
2010 2009For the year ended December 31,
Investment Highlights13
• 3 Product lines: Audio furniture, multi-media speakers and video products Pioneer and market leader in audio furniture
• Distribution in China of AIV-brand audio furniture
• New Products: Interactive Intelligent Panel, Electronic Menu, Electronic Mahjong
System, Sound Bar
• Strong Management Team; R&D capabilities
• Strong Financial Growth: Revenue up 77.6% and net income up 47% YOY
• 2011 Net income and EPS guidance of $13.7 million and $0.61
Contact Us14
AIVtech International Group Co.Robinson Shi, CFO
PH: +86 755 2533 3022
Investor Relations Contact:
HSC Global, LLC
Alan Sheinwald, President
US +1-914-669-8885
Email: [email protected]
Corporate Information Investor Contact
Auditor CounselFriedman LLP1700 BroadwayNew York, NY 10119
Anslow & Jaclin LLP
1350 Avenue of the Americas, 3rd Floor
New York, NY 10019