Advancing Security and Well-Being Every Day

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Transcription:

Advancing Security and Well-Being Every Day Robert D. Welding Stephanie K. Kushner September 19, 2007 Safe Harbor This presentation contains various forward-looking statements as of the date hereof and the Company undertakes no obligation to update these statements regardless of new developments or otherwise. Statements in this presentation that are not historical are forward-looking statements. These risks and uncertainties, some of which are beyond the company s control, include the cyclical nature of the company s industrial and municipal markets, technological advances by competitors, the Company s ability to improve its operating performance, risks associated with the execution of new product introduction, increased warranty and product liability expenses, risks associated with supplier, dealer and other partner alliances, changes in cost competitiveness including those resulting from foreign currency movements, disruptions in the supply of parts or components from sole source suppliers and subcontractors, retention of key employees and general changes in the competitive environment. September 19, 2007 2 1

Investment Highlights Strong management team 100+ years of product leadership Business transformation gaining momentum Focus shifting to higher-growth mission critical products Diversity of markets 3 Management Team Executive Officer Position (Years at FSS) Experience (Years in Industry) Robert Welding CEO 4 Borg Warner, Volkswagen, GM 37 Stephanie Kushner CFO 5 FMC, Amoco 25 Peter Guile President, E-ONE 11 Federal Signal, Concord Lighting 22 Dave McConnaughey President, SSG 2 Maytag, Borg Warner 30 Esa Peltola President, Bronto 27 Bronto 38 Mark Weber President, ESG 11 Cummins Engine 28 4 2

Product Leadership Drives Our Business Renewed focus on providing best-in-class products 100+ year history of product leadership #1 or #2 in most markets Mission-critical products Trusted brands proven performance Boosted new product engineers by more than 50% in past year FS Codespear interoperable communications platforms FS Legend Lightbar FS E-ONE Typhoon FS Vactor HXX Vacuum Excavator 5 2006 Revenues and Orders Segment Revenues $1.2 billion Customer Orders $1.2 billion Fire Rescue 32% Environmental Solutions 33% Tool 10% U.S. Industrial/ Commercial 25% Non-U.S. 36% Safety & Security Systems 25% U.S. Municipal 39% 6 3

Recent History Robert Welding joins as CEO Formalized New Product Development Process New Growth Strategy Launched Significant New Products Launched December February 2003 2004 2005 2006 2007 Initiated Shrink to grow strategy Closed 6 plants Sold/divested 7 business units Divested cutting tools Acquired Security Focused Technology Companies 7 Growth and Enabling Strategies 8 4

EV Growth Strategy Safety & Security Top line growth > 15% Retain 14% 15% margins Aggressive entry into software solutions Environmental Solutions E-One Bronto Global growth Adding intelligence to products Regain North American share Dealer network New products Restore profitability Increase capacity Accelerate North American growth Tool Non-core business Evaluate alternatives 9 Segment Overview ($ in millions) Assets (a) Revenue LT Organic Operating Margin % 12/31/06 2006 Growth 2006 LT Target Safety & Security $348 $305 10% 15% 13.5% 14% 16% Environmental 229 399 6 8 9.3 9 10 Fire Rescue (E-One & Bronto) 219 385 6 8 1.8 9 10 Tool 117 123 5 6 6.7 >7 (a) Adjusted for 2007 acquisitions. 10 5

Changing our Portfolio Shrink to Grow Leasing portfolio Plastisol Preble Justrite TTI Victor product lines Refuse FAPD do Brasil Cutting tools Superior Acquisitions Codespear $17M Riverchase $7M PIPS $117M $150 million proceeds $141 million 11 Acquisition Criteria Contribution to Growth ~1/3 growth from acquisitions plus One-time redeployment of shrink to grow proceeds Business Criteria Acquire new technologies Accelerate global growth Leverage channel Financial Criteria NPV (risk adjusted cost of capital) TTM EBITDA Multiples EV positive @ 10% after year 2 Robust Integration Process Extensive integration into FSS processes and systems Joint accountability between acquisition management and FSS corporate Standard integration plan, tailored to specific business 12 6

Global Safety and Security Products and Systems ($ in billions) INDUSTRY MARKET SIZE & GROWTH Physical Safeguards Security Market 2004 2008E Growth Rate Locks 5.9% Safes, Vaults, Fire Extinguishers 4.8 Market Size $5.0 $17.0 Monitor / Alert Access Control and Surveillance Systems 11.0 Alarm & Warning Systems 7.7 Other Electronic Security 9.9 Systems Integration 12.0 15.0 $4.0 $5.0 $14.0 $17.0 Respond / Enforce Response Management Systems > 10 Emergency Response Vehicles 4-6 (Police, Fire, Border, Ports) ~ $1.0 $10.0 0.0 5.0 10.0 15.0 20.0 $25.0 Source: Wall Street equity research, Freedonia, company estimates. 13 Global Safety and Security Products and Systems FSS Product Placement Residential Institutional Industrial Commercial Transp. & Parking Streets, Borders, Communites Ports Physical Safeguards $24B Monitor / Alert $43B Respond / Enforce $11B 14 7

Safety & Security Systems Group Municipal and Government Systems Mobile Systems Industrial Systems Transportation Systems % of SSG 8% 45% 27% 20% Product/ Solutions All-hazard warning Audible and visual warning devices Audible and visual warning devices Commercial vehicle enforcement Building and facility safety and security Fire rescue vehicles Critical communications Congestion tolling Command and control vehicle Heavy-duty vehicles Hazardous area lighting Parking revenue management and security Computer aided dispatch Mobile data terminals Indoor warning Tolling Critical communications Mobile video Industrial signaling Traffic study Emergency operations centers Police vehicles Travel time Emergency scenario management HazMat explosive monitoring Interoperable communications Mass notification Mobile data terminals Neighborhood watch Process management (SCADA) Public address, paging and emergency response Public safety broadband wireless network Public safety software Tsunami warning Vehicle location Water/wastewater monitoring Customers City, state and federal governments Department of Transportation Coal mines Airports Colleges and universities Fire and emergency response agencies High-profile facilities City, state and federal governments Department of Energy Police departments Industrial plants Department of Homeland Security Department of Homeland Security State and federal agencies Petrochemical plants Mass transit authorities Department of Transportation Tow truck operators Ship and rig builders Military bases Nuclear power plants 15 SSG Organic Growth ($ in millions) $400 +15% 40 +18% 300 CAGR = 2% 30 200 20 % 100 10 0 2001 2002 2003 2004 2005 2006 7/26/07 Guidance 0 Orders Operating Margin 16 8

What Drives Our Growth Opportunities Interoperability Communication Intelligence Infrastructure Data transfer White Space Opportunities Needs Capabilities Technology Broadband Wireless Video VoIP Voice recognition Sensors Unique footprint Product depth Employee talent Culture of innovation Customer relationships 17 Recent Acquisitions ($ in millions) Purchase Strategic Target Price Rationale Codespear $17M Personal alerting complements mass-warning Best interoperable communications product Software platform Riverchase 7M Software modules sought by EOC s Modules easily plug into Codespear platform Strong reseller channel in some U.S. regions PIPS 117M Leading provider of automated license plate recognition systems High-growth market addressing security Video analytic software 18 9

Codespear SmartMsg - IP-based software blends communications interoperability, alert notification, secure urgent messaging, and interactive data sharing Radio Interoperability - Voice-over- IP architecture enables simultaneous text and voice broadcasts from any device to any other device Scenario Manager - An integrated incident planning and execution tool that optimizes tiered response plans Mass Citizen Alert - A secure and reliable method for public safety leaders to notify citizens 19 Riverchase Technologies Enables 911 dispatchers to properly route municipal assets Captures video via a motionactivated camera Tracks and locates vehicles via GPS technology Automatic vehicle location Records Management Enables hand-held devices to access public safety databases Merges functionality of field reporting and in-house records management 911 Center Computer Aided Dispatch 20 10

PIPS Technology Largest installed base > 10,000 ALPR cameras 220 customers in 25 countries 20% 25% global market share Highest performing technology History of innovation and product leadership Captures and recognizes up to 3,600 plate images per hour at speeds of up to 160 mph Parking & Access Control Law Enforcement Tolling & Congestion Charging 21 Codespear Platform Links Municipal Assets prevent, warn, respond, recover, maintain Many assets with interoperability 22 11

Convergence of Interoperable Security and FRG Comms-ONE Command & Control Vehicle Mobile command and control for first responders Codespear platform for seamless communications interoperability Riverchase mobile data module provides real-time access to local & state databases Satellite link, landline, mobile two-way radio, Wi-Fi and video communications 23 Investment Highlights Strong management team 100+ years of product leadership Business transformation gaining momentum Focus shifting to higher-growth mission critical products Diversity of markets 24 12

Vision Federal Signal the leader in advancing security and well-being for communities and workplaces around the world. 13