Building Global Connections

Building Global Connections Connectivity | Wireless | Wireline | Professional Services ADC Corporate Profile ADC AT A GLANCE Building Global Connections In the unrelenting drive for bandwidth, com-municationsserviceprovidersacrosstheglobe increasingly rely on ADC to eliminate the bot-tlenecks in the delivery of high-speed, high-quality video, data and voice services to con-sumers and businesses — in the home, in the office and on the go. With an industry-leading portfolio of network infrastructure solutions and services, ADC is supporting our customers as they continue to invest heavily in the migration to next gen-eration networks. This transformation impacts the “last mile/ kilometer”—thenetworkareawhereADChelpssmooththe convergence of wireline and wireless applications and transi-tions infrastructure from its legacy copper and circuit origins to a fiber and packet architecture. The demand for broadband services is dramatic. There is a rapidly increasing dependence on multi-service communica-tion networks to support a wide range of business or per-sonal needs, along with subscriber expectations to conduct communications anywhere over a single IP-based network connection. ADC provides innovative, cost-effective and high-quality solutions for both public and private networks as they evolve to provide dynamic combinations of services at the highest possible speeds. In the year ahead, ADC will continue to satisfy the demands of copper-based networks, be a leader in the migration to fiber infrastructure and move to the forefront in offering a new generation of wireless capacity and coverage solutions — both in our core and developing markets worldwide. MARKETS ADC’s NETWORK INFRASTRUCTURE SOLUTIONS CONNECTIVITY ADC is a leading global fiber infrastructure supplier with solutions that accelerate the deployment of fiber-intensive broadband networks serving business, residential and mobile subscribers. Service providers worldwide are looking to ADC connectiv-ity products to simplify network installation, maintenance and management from the central office/headend, through the outside plant, all the way to the premises. Our fiber and copper connectivity portfolio, including OmniReach® FTTX Solutions for the outside plant, offers scalable cost-efficient solutions for any type of architecture, providing enhanced services to subscribers and new sources of revenue for ser-vice providers. In addition, our acquisition of Century Man Communication in China strengthens our position in this fast-growing connectivity market and enables us to meet the unique needs of developing countries. From global financial institutions to universities to govern-ment agencies, new technologies and advanced business requirements that consume more bandwidth require rethink-ing the entire enterprise network infrastructure. Engineered to maximize uptime, ADC’s TrueNet® portfolio provides cop-per and fiber cable, connectivity and cable management so-lutions for the world’s most sophisticated data centers and local area networks. ADC products are designed to use less space, protect fiber-optic cables and promote energy effi-ciency, while supporting the high-speed delivery of mission-critical services. ADC continues to innovate. Connectivity products, such as our reduced-bend radius fiber cables, high-density frames PRODUCT AND SERVICE GROUPS 2007 sales: $1,322 million Outside of the United States = 39% WIRELESS 3% • Coverage and capacity enhancement PROFESSIONAL 16% SERVICES • Plan, deploy and maintain communication networks 4% WIRELINE • High-capacity access 77% GLOBAL CONNECTIVITY SOLUTIONS • Broadband connectivity • Enterprise connectivity 2 and multiple dwelling unit (MDU) solutions, lead the industry in supporting the delivery of high-bandwidth services. We are also a leading supplier for reliable, high-performance high-definition video and multichannel audio connectivity products used by broadcasters and service providers worldwide. WIRELESS With today’s converged wireless applications outstripping wireless networks’ capabilities, ADC is delivering the next-generation Radio Access Network (RAN) to improve both coverage and capacity in high-demand and hard-to-reach locations. We are helping change the way people communi-cate through our high performance and scalable FlexWave™ solutions for wireless networking. From extending fiber reach, to increasing indoor and outdoor coverage and capacity, to providing high-speed wireless backhaul, carriers consistently look to ADC for reliable solutions that increase revenue, lower churn and improve customer satisfaction. ADC is well positioned to meet the diverse customer and geo-graphic needs of the constantly evolving wireless marketplace. Our recent acquisition of LGC Wireless and its innovative in-building solutions expands our wireless product portfolio and accelerates the execution of ADC’s All-IP RAN, creating a com-prehensive portfolio of market-leading solutions for carriers and the enterprise. WIRELINE ADC’swirelineproductsenabledeliveryofhigh-capacityvoice and data services over copper or optical facilities in the “last mile/kilometer” of communications networks, while integrat-ing capabilities that can help reduce capital and operating costs. The LoopStar® and PONy Express™ product families CUSTOMERS provide flexible and economical optical transport platforms for both legacy voice and next-generation protocols. When building a new network or managing or expanding an exist-ing one, our solutions support the delivery of a wide array of business service and cell site backhaul offerings for carriers and the enterprise, for a variety of different transmission rates and protocols. PROFESSIONAL SERVICES With deep experience in multivendor, multitechnology and multiservice networks, ADC supports customers throughout the technology lifecycle. We help create and maintain wire-line,wireless,cableandenterprisenetworksinNorthAmerica and Europe — from network design, build-out, turn-up and testing to ongoing maintenance and training. Customers rely on ADC to plan, deploy and maintain networks delivering commercial and residential broadband services. ADC is also expanding support of wireless carriers and cable operators while continuing to serve as a cost-effective resource for our customers. A GLOBAL CONNECTIVITY LEADER Leading the way through a transforming communications mar-ketplace, ADC is focused on the network needs and business challenges of customers in more than 130 countries around the world. Our ability to design and manufacture innovative equipment for any type of network sets us apart. We enable network operators everywhere to migrate successfully to next generation networks that deliver against the advanced ser-vice expectations of businesses and consumers. ADC’s strong commitment to anticipating and meeting market demand is evident in our portfolio of products and services with a repu-tation for reliability, superior performance and value. PRIMARY COMPETITORS Global Connectivity: WIRELESS 7% CABLE TV/ 2% BROADCAST ENTERPRISE 16% ORIGINAL EQUIPMENT MANUFACTURERS 69% TELECOM 3M, CommScope, Corning, Furukawa, Nexans, Panduit, Telect, and Tyco Wireless: Andrew, Mobile Access and Powerwave Wireline: ADTRAN and Schmid Professional Services: AFL Telecommunications, Alcatel-Lucent, Böke & Walterfang, EMBARQ Logistics, Ericsson, GAH Group, Mastec, NEC, Nokia Siemens Networks, SAG, and Telamon 3 FIVE-YEAR FINANCIAL HIGHLIGHTS1 INCREASE SALES... Net sales (in millions) REDUCE EXPENSES... R&D and selling & administration expenses as % of sales INCREASE EPS... Earnings (loss) per share from continuing operations $1300 40% $0.90 $1040 32% $0.60 $780 24% $0.30 $520 16% $0.00 $260 8% $-0.30 $0 03 04 05 06 07 0% 03 04 05 06 07 $-0.60 03 04 05 06 07 Years ended October 31 (dollars in millions, except per share data) Selected results and ratios from continuing operations Net sales Sales outside the United States Gross margin Research and development (% net sales) Selling and administration expense (% net sales) Amortization of purchased intangibles (% net sales) Impairment charges (% net sales) Restructuring charges (% net sales) Operating income (loss) margin Pre-tax income (loss) margin Effective income tax rate Income (loss) Income (loss) margin Income (loss) per diluted share (EPS) Return on average shareowners’ investment (ROE) Total cash provided by operating activities Depreciation and amortization Capital expenditures, net of disposals Selected balance sheet data and ratios Accounts receivable, net Inventories, net Current assets Property and equipment, net Total assets Accounts payable Current liabilities Long-term notes payable Shareowners’ investment (equity) Working capital Current ratio Debt-to-equity ratio Number of employees 2007 $ 1,322.2 $ 518.4 33.5% 5.3% 20.2% 1.8% 0.3% 0.8% 5.1% 8.8% 2.8% $ 113.3 8.6% $ 0.96 12.0% $ 152.5 $ 68.5 $ 31.3 $ 189.4 $ 170.2 $ 1,008.2 $ 199.2 $ 1,764.8 $ 92.5 $ 474.1 $ 200.6 $ 1,007.6 $ 534.1 2.1 19.9% 9,047 Growth 07 vs. 06 3.2% (2.4)% 18.9% 18.5% 62.9% 6.9% 9.5% 79.7% 15.4% 5.4% 2006 1,281.7 531.2 32.2% 5.5% 19.3% 2.0% 0.1% 1.5% 3.7% 4.5% (65.5)% 95.3 7.4% 0.81 12.4% 93.6 68.0 32.1 169.3 165.4 942.7 206.4 1,611.4 88.2 263.9 400.0 873.5 678.8 3.6 45.8% 8,580 2005 1,128.9 488.9 37.7% 6.2% 21.4% 1.6% 0.0% 0.9% 7.5% 9.4% 6.8% 98.8 8.8% 0.82 13.8% 75.4 66.9 18.7 180.6 140.3 854.8 220.2 1,537.2 69.2 288.8 400.0 773.9 566.0 3.0 51.7% 8,185 2004 733.9 266.4 40.9% 8.1% 27.2% 0.6% 0.2% 1.6% 3.3% 4.6% 6.0% 31.6 4.3% 0.27 4.9% 77.5 40.9 3.2 142.9 97.5 835.8 231.4 1,428.1 65.0 302.0 400.0 659.3 533.8 2.8 60.7% 7,502 2003 545.1 NA 38.7% 11.0% 28.5% NA NA NA (7.4)% (13.6)% (6.9)% (69.0) (12.7)% (0.60) (10.1)% NA NA NA 71.1 56.7 1,032.4 173.5 1,296.9 37.2 266.8 400.0 627.7 765.6 3.9 63.7% 5,700 Investment information Stock price - close $ 18.70 - high $ 21.06 - low $ 13.40 ... - tailieumienphi.vn