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To: david james who started this subject1/23/2003 7:52:01 AM
From: Sector Investor
   of 6931
 
Update Consolidated Links

Date January 23, 2003

KVH Industries, Inc., based in Middletown, Rhode Island, is an international leader in developing and manufacturing innovative, mobile, high-bandwidth satellite communications systems, tactical navigation products, and fiber optic products.

Company Overview --- kvh.com

Earnings and CC related links

Q2 1997 EPS release - Message 1813680
Q2 1997 CC Notes ----- Message 1816064
Q3 1997 downgrade --- Message 2269984
Q3 1997 EPS release - Message 2534856
Q4 1997 warning -------- Message 3187118
Q2 1998 CC analysis --http://www.siliconinvestor.com/readmsg.aspx?msgid=5387249
Q2 1998 CC notes1 ---- Message 5389093
Q2 1998 CC notes2 ---- Message 5512880
Q4 1998 EPS release - Message 8034473
Q4 1998 CC notes ----- Message 8303464
Q1 1999 EPS rel ------- Message 9085267
Q2 1999 EPS rel ------- Message 10705163
Q3 1999 EPS rel ------- Message 11659825
Q4 1999 EPS rel ------- Message 12862196
Q1 2000 EPS rel ------- Message 13470540
Q1 2000 CC notes ----- Message 13474450
Q1 2000 Analysts ------ Message 13476701
Q2 2000 EPS rel ------- Message 14077309
Q3 2000 EPS rel ------- Message 14615735
Q4 2000 EPS rel ------- Message 15318557
Q1 2001 EPS rel ------- Message 15686350
Q2 2001 EPS rel ------- Message 16098259
Q3 2001 EPS rel ------- Message 16543116
Q4 2001 EPS pre ------- Message 16876175
Q4 2001 EPS rel ------- Message 17091602
Q1 2002 Update -------- Message 17273314
Q1 2002 EPS rel ------- Message 17380588
Q1 2002 CC notes1 --- Message 17396999
Q1 2002 CC notes2 --- Message 17397004
Q2 2002 EPS rel ------- Message 17755541
Q2 2002 Fin Tables --- Message 17755543
Q2 2002 CC transcript1 - Message 17779637
Q2 2002 CC transcript2 - Message 17779657
Q2 2002 CC transcript3 - Message 17779670
Q2 2002 EPS rel ------- Message 18123917
Q3 2002 EPS fin ------- Message 18123927
Q3 2002 CC transcript1 – Message 18170264
Q3 2002 CC transcript2 - Message 18170268
Q4 2002 Nov Update - Message 18215521
Q4 2002 rcd qtr Pre-announce - Message 18410813
Q1 2003 Needham presentation - twst.com


Contract, Service or partnering announcements

1997 Swedish military --------------- Message 1818477
1998 US Army ------------------------- Message 5154917
1998 US Marines --------------------- Message 6641124
1999 River Park teams -------------- Message 11041324
1999 UK Army order ----------------- Message 11652006
1999 Delfin Contract ----------------- Message 11791701
1999 Marathon Coach --------------- Message 12170187
2000 $1.4M Repeat order ---------- Message 13215646
2000 $1.2 million FOG -------------- Message 13460763
2000 Entertain Coaches ------------ Message 13566973
2000 $17M US Army ----------------- Message 13904501
2000 $1M Crossbow partnership - Message 13997834
2000 Sportvision cameras ---------- Message 14021855
2000 First in Europe ------------------ Message 14078705
2000 $1.5 M Javelin Simulator ---- Message 14734776
2000 $4.7M Asian Military ---------- Message 15001558
2001 $3.2M Australian Army ------- Message 15141200
2001 $1.75M golfcart sensor ------- Message 15454327
2001 Russian market entry --------- Message 15471918
2001 UK selects Gyrotrac ---------- Message 15472306
2001 $2.7M French Army ----------- Message 15786386
2001 StagParkway -------------------- Message 15889621
2001 $1.5M New Zealand Military Message 16091879
2001 Swedish Navy ------------------- Message 16506811
2001 Bell ExpressVu ----------------- Message 16537495
2001 $3.9M FOG order -------------- Message 16632688
2002 Thane & Thrane ---------------- Message 17054427
2002 Lockheed-Martin Train system Message 17486946
2002 US Weapons simulators ------ Message 17464265
2002 $700K FOGs -turret stabilization - Message 17538721
2002 Optional equip on Fleetwood RVs - Message 17580267
2002 KVH becomes Inmarsat Global ISP- Message 17596838
……. Inmarsat Information -------------- Message 17597008
……. Comparison of Sat Networks ------- remotesatellite.com
2002 Std equip on Featherlite Coaches -- Message 17661922
……. About Featherlite ------------------- featherlitecoaches.com
…..... KVH TracVision L3 ------------- kvh.com
……. KVH Tracphone 252 ------------ kvh.com
……. KVH TracNet ---------------------- kvh.com
2002 Rexhall selects KVH antennas ----- Message 17677523
…….. US Class A Motorhome market -- Message 17677556
2002 $1M DSP IMU dev from L-3 Comm - Message 17715075
2002 ABB partners on Current Sensor - Message 17772501
2002 GCS-KVH Inmarsat partnership - Message 17965753
2002 $1M order for Ground Prophet --- Message 17994488
2002 Becker Celebrity Mobile Office PR Message 18009051
……... Becker Celebrity Customer List -http://www.beckerautodesign.com/clients/
……... Becker luxury Office Interiors -- beckerautodesign.com
2002 Std equip on Marathon Coaches Message 18032686
2002 $3.6M for Army Special Forces - Message 18066989
2002 SF funding in FY2003 budget - Message 18285367
2003 $1.6M UK/Saudi/Oman TACNAV - Message 18410816
2003 TracVision STD on Newell Coach - Message 18437078


Product announcements

1997 Trac Phone 50 ------------ Message 2147224
1998 Trac Phone 25 ------------ Message 3404697
1998 Trac Vision 45 ------------ Message 5200344
1999 Trac Vision LM ----------- Message 7402304
1999 KVH hits the road -------- Message 7402304
1999 Trac Vision Cruiser ------ Message 10653331
2000 Trac Vision G4 ------------ Message 12843047
2000 Trac Vision SA ------------ Message 13016180
2000 TracVison G6 DVB ------ Message 14616651
2000 TracVision L3 -------------- Message 14955234
2000 TracVision C3 ------------- Message 15040053
2001 Multilingual TacNav ------ Message 15471658
2001 Trac Vision L3 Truck ---- Message 15471899
2001 Trac Vision L3 vehicle -- Message 15472075
2001 ActiveFiber Technology - Message 15525677
2001 E-Core PM Fiber ---------- Message 15526177
2001 TracNet Server-Marine -- Message 16549100
2001 DirecPC -R Satellite ------ Message 16549104
2001 Tracphone 252 ------------- Message 16555352
2001 TracVision S3 -------------- Message 16677874
2001 TracNet Server-land ------ Message 16706826
….…. TracNet Brochure ------------ kvh.com
2002 TracPhone F77 ------------ Message 17060078
2002 DSP-5000 FOG ----------- Message 17336044
2002 TracNet 2.0 Caribbean- Message 18177880
2002 TracNet 2.0 Europe --- Message 18250252
2002 TracVision L2, S2 --------- Message 18294265
2003 TracVision G8 80cm ------ Message 18391791
2003 TracVision A5 preannounce - Message 18405663
2003 TracVision A5 announce - Message 18421432
….…. CNET interview with Martin – cnet.com



Management or I/R comments posted

1998 Tacnav related -- ------- Message 5191881
1998 general -------- ----------- Message 5678484
1999 mobile internet --------- Message 7177546
2000 Power sensing --------- Message 11697383
2000 CEO Interview ---------- Message 13647777
2002 CEO at Needham ------ Message 16876175
2002 Needham transcript ----- Message 16892251

Facility Tour posts

2000 Home Office Tour -------- Message 13483638
2000 FOG Sensors Tour ------ Message 13742694

KVH major customer list

From the 2001 Mission brochure -- Message 17489301

A few of the US patents

Under KVH Industries ---- patft.uspto.gov.
Under Dyott ------------------ patft.uspto.gov.
Dyott applications --------- appft1.uspto.gov.

Significant Personnel additions

1999 Charles Trimble joins BOD ------- Message 9802059
2000 Larry Dalton on Advisory Bd ----- Message 14592383
2000 John Seavey on Advisory Bd ----- Message 15085660
2001 New COO Joe Bookataub -------- Message 16238135
2002 Steve Buckingham joins KVH ------ Message 17486936
2002 New VP Eng. Dr. Kalyan Ganesan - Message 17553371
2002 New CFO Patrick J. Spratt -------- Message 17755516
2003 New VP Bus Dev. Daniel Conway - Message 18479195



Awards and Certifications

1998 Best in category awards ---------- Message 6624271
1999 ISO 9001 standards ---------------- Message 10052445
1999 US Army "Outstanding partner"---- Message 10063051
1999 Camping World award ------------ Message 11465314
1999 NMEA "Best" awards ------------- Message 11717969
2000 NMEA "Best" 3rd yr in row ------- Message 14659699
2001 NMEA "Best" 4th yr in row --------- Message 16596940
2002 StagParkway Peach Award -------- Message 17026775
2002 DOD Outstanding Quality Award -- Message 17611817
2002 NMEA "Best" 5th yr in row --------- Message 18168569


General/Miscellaneous


1999 Article on Trac vision II ------------ Message 8383221
1999 Briar Patch Invest Opinion ------- Message 8638735
2000 Datron Patent Lawsuit ------------ Message 12864170
2000 Datron response on lawsuit ------ Message 12941582
2000 Patent involved in the suit -------- patft.uspto.gov.
2000 GPS use poised to take off ------ Message 13600523
2000 Datron lawsuit terminated -------- Message 14139395
2001 $5M private placement ------------ Message 15107364
2001 Featherlite TracVision L3 std ----- Message 15581572
2001 $10M Private Placement ---------- Message 15678840
2001 Completion of financing ----------- Message 15875422
2001 KVH featured in Navy SBIR ------ Message 17487085
2001 Gyrotrac helps Playstation set record - Message 17487087
2002 TracNet Hits the Road w Internet -- Message 17450037
2002 Patent-reduced configuration Gyro Message 17480877
2002 First customers praise new F77 --- Message 17494877
2002 KVH Antenna During Tornados -- Message 17563489
2002 KVH praised by Congressional Delegation Message 17808743
2002 KVH Sailcomp helps J/24 Sailboat win - Message 17840526
2002 KVH selects CostGuard ASP for billing Message 18028816
2002 Patent-DSP for Open-loop sensors - Message 18090779
2002 Emergency Responders Hunterdon Co - Message 18344212
2002 WSJ article: Live TV to Cars - Message 18348909

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To: david james who started this subject1/27/2003 9:49:18 PM
From: Sector Investor
   of 6931
 
The full transcript of the KVH presentation at Needham will follow in the next post. The slides and the audio are presently available on the KVH website under Investor Relations.

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To: Sector Investor who wrote (1790)1/27/2003 9:49:53 PM
From: Sector Investor
   of 6931
 
KVH Needham Growth Conference 2003 presentation, January 8, 2003

Pierre Maccagno, Needham

… KVH presentation. It is a company we like very much, especially since the announcement of the low-profile satellite antenna, and that drove the stock quite a bit last Monday. So I have the pleasure of introducing Martin Kits Van Heyningen, the CEO of the company, who will be giving the presentation. And afterwards we have a breakout session in the Campo room. Thanks.

[Martin Kits Van Heyningen] Thanks Pierre,

You know, the one problem with the Needham conference is that it’s so early in the year; whatever we say here ends up being like our New Year’s resolutions. And as part of preparing for this year’s conference, I went back and looked at what we said here last year, and we talk about growing the business 30-40%, doubling our military business, introducing some new products, and developing technology and getting back to profitability. I’m pretty pleased to say that we actually did all those things. That despite the economy, we’ve been able to grow and prosper, and do pretty much what we said we were going to do.

So, I’m going to start with a little bit of an overview, high-level. KVH is an established company. We have two different technologies that we are focused on, fiber optics and mobile satellite antennas. We’ve been able to grow the business, actually in excess of our targets for last year, we grew about 45% overall. At the same time we reached breakeven about mid-year, and we have improving profitability. I think the company has demonstrated an ability to act successfully over the last year. That’s really evidenced by the fact that we are able to be the market leader in two different areas, one is the Defense market for tactical navigation systems, and the second is the mobile satellite area, for mobile satellite communications.

Now within both of those markets we are pursuing some very large opportunities, these are multi-billion dollar opportunities, so the company has significant growth potential in both sectors. And perhaps the most exciting thing that Pierre just alluded to, is that we have just announced that tomorrow at CES we will be introducing a revolutionary new product, which is a satellite antenna for cars and automotive products.

So the company addresses two markets, the Defense and Communications market, and within each of those markets we have two different technologies. We have the fiber optic and digital sensor technology including the digital compasses, and mobile satellite antennas for the communications market.

Given all that’s going on in the world, I thought I’d start with our Defense market. It represents about 30% of our business today on an annual basis. What we do is we provide our tactical navigation systems for vehicles within this market. As you know, the military’s role is evolving and changing quite a bit. It is now much more focused on rapid deployment, on high speed precision maneuvers, and a much greater use of Special Forces, a much more tactical type of military operation. And that’s exactly what our products do, these are tactical navigation devices that provide precision navigation, heading and pointing, essentially situational awareness for the troops. It is based on our digital compass technology, as well as our fiber optic gyros – a very cost effective solution for military NAV systems.

But perhaps the most important aspect of our product, is that it is completely self-contained, and it is jam-proof. Many of you have probably heard that the Iraqis have been buying these Russian made GPS jammers, so that they are able to now jam the GPS signals for a radius of 100 miles or more, with a device that costs about $100. This is a major concern to the military of course, and that’s one of the big benefits of our product, that it cannot be jammed. The market itself is fairly large for military vehicles. For what we consider to be our target market there are about 450,000 vehicles, and that includes Hum-vees and Light Armored vehicles, and we are actually a leading supplier in that market, as we’ve pioneered that whole concept of putting NAV systems on vehicles, which we did during Desert Storm, we were the first company to build NAV systems for Light Armored Vehicles.

As a result of that, we still are the market leader. We’ve installed about 8,000 systems so far, that’s roughly $80 million worth of product, so the penetration rates are still very low, and we are at the early stage of the adoption curve with this technology. Just recently we’ve gotten some major contract awards, which are fairly significant. In September, we were awarded the contract for our Special Forces vehicles, all their Hum-vees and light trucks are going to be equipped with our equipment, our NAV system.

As you know the U.S. military around the world is highly regarded, and people look to see what the U.S. military is buying, and within the military the Special Forces has by far the most prestigious group, so it’s a very important win for us, and we are very proud to be on those vehicles as they head over to the Middle East. Also, just yesterday we announced a couple of other contracts, the UK army – again this was an urgent operational requirement – we have to deliver all this equipment very quickly for those vehicles that are going overseas, and we also got contracts from the Marine Corps and the government of Saudi Arabia. A lot of business is happening right now in this area for KVH.

The technology that we are using here in our NAV systems is based on our Fiber Optic Gyros, but we also use these gyros for other applications and we sell the gyros separately, as a stand-alone sensor. Now these fiber optic gyros actually measure rotation rate very precisely. They are accurate enough that, if you put them on your desk, you’ll measure the rotation rate of the Earth, so they are very, very accurate. And they are used as a replacement for mechanical gyros, and they are also now much more accurate than the Micro Machine technology, or the MEMS technology.

And the reason that’s important is that the applications for fiber-optic gyros in what’s called IMUs or Inertial Measurement Units, is expanding. – drones, unmanned aircraft, and of course in missiles, and now Smart Bombs. All of these things require guidance. During Desert Storm 10 years ago, 90% of the bombs that were dropped were unguided, free-fall dumb bombs. This time around, it’s estimated that 80%-90% of the weapons will be smart – will be guided weapons, and those require three gyros per device.

Not too long ago, they would take a 2,000 pound bomb, and if you got it anywhere within a city block, you would wipe out the entire block. Now they want to be much more strategic, with a far higher level of precision, and that precision gets translated into a greater accuracy requirement for the sensing device. Now something that we are working on, just in the last year we got a $1 million development contract from L-3 Communications to integrate our fiber-optic gyros into one of these very high precision devices. It’s a very large market, it’s a growing market, and we estimate that it’s probably about a $2.7 billion addressable market just for our fiber-optic gyro technology.

Overall, if you look at our Defense business, the addressable market then, between the vehicles and the fiber-optic gyros, smart munitions type applications is about a $7 billion addressable market. In terms of overall trends, obviously Defense budgets are going up, but even within that, you may have heard Rumsfeld say yesterday that more money again is being allocated to Special Forces so the types of fast response groups, that use our equipment are getting more and more money as well, so that’s a good trend that helps our type of products.

And of course the focus on smart weapons and precision, that trend is important from a technology point of view, because if you think about the problem of strategically taking out one particular building where the bad guys are, in order to do that you need to very accurately designate where these targets are. That translates into better accuracy requirements for the vehicle, so that you know YOUR position, so that when you point to a target with your laser, you are accurately able to designate. So it’s driving demand for tactical navigation, as well as for the guidance system that’s in the munitions.

So, overall the military channel has been relatively good to us in the last year, our business has more than doubled. The military channel is a profitable channel for us, but it also provides good balance for the company, in that we have part of our business that’s not dependent on the current economic conditions. We’ve got some good backlog going into 2003, and we see significant upside in this part of our business, although we certainly don’t expect 100% growth like we had last year.

Now the technology that underlies these products, our fiber-optic technology is not just a military technology. There are a lot of applications here. We have a very unique technology base. We’ve got over 80 patents now that have been issued and that are pending. We have a state of the art fiber-optic facility where we make our own fiber. We make all the components that go into these optical systems. There are a lot of exciting new opportunities. Just last year we signed a contract with the ABB group to develop an optical Current Sensor which is based on our fiber-optic gyro technology, but uses a different kind of sensing coil, and a different type of fiber, and it measures electrical current in high voltage power lines. Today this is about a $500 million market a year, for high voltage current sensing, so we see that as a very exciting opportunity.

On the technology side we are also developing some interesting products based on the optical fiber itself. We have a project we call PhotonicFiber where we’re putting electro-optic polymers actually inside the fiber to make the fiber an active fiber to make optical components. Originally this was targeted towards something called the telecom market, which we haven’t been able to find recently, so instead we’ve redirected a lot of that effort in the sensing market. Just recently we got a contract from the Department of Defense to build a high-speed optical modulator in the fiber for a defense application. Also this technology can be used as a phase shifter for a photonic phased-array antenna. Of course antennas are very important to KVH, because that’s where a large portion of a business comes from today.

So the second part of our business, we’ve covered Defense now and I’ll move on to Communications, our Mobile Satellite business. On the satellite side, KVH really has an enabling technology. What we do is we allow mobile customers to receive the same type of services while they’re mobile, that they can get at home. The same broadband Internet, the same digital satellite quality television. Our antennas accurately track the satellites despite the motion of the vessel or the vehicle, giving it full video and broadband capability.

That’s actually a pretty challenging problem because you need to be pointed at the satellite to within 1 degree at all times, whether you are a boat rolling and pitching in 12 foot seas, or on an RV driving down the highway and making sharp turns. In order to do that you need a number of different technologies. It’s a software/hardware problem, you have fiber-optic gyros, robotics, antennas, antenna technology including phased-array antenna technology, and RF technology. So it’s a very difficult problem, and you have to integrate that with the satellite itself and the satellite services to make sure you are decoding the correct M-PEG II data streams from the correct satellite. So it’s a surprisingly difficult problem, that we’ve been able to solve. One of the advantages, I think it gives us some significant barriers to entry, and it has dramatically limited the competition in most of the markets that we are in.

On the demand side, we’ve seen a very, very strong demand for satellite television in the markets we are in now. The television screens are already on board just about every boat over 40 feet, and just about every motor home and RV, so the TV screens are there, and once the screens were there we saw a very rapid adoption of our technology. People wanted something to watch on those screens once they had the TVs onboard. Satellite TV as a product category in these mobile markets is now a leading after-market product, and at the OEM level, really every RV manufacturer and every boat builder is now offering some type of satellite television. So it’s becoming much more of a mainstream product.

We’re also seeing emerging demand for satellite high speed Internet. Those same customers that now have our product, we’ve introduced a product called TracNet, which will provide high speed Internet service. And this uses the same satellite antenna, the television antenna that our TracVision product uses. It’s an integrated server, router, and it has a 802.11 Wi-Fi connection to the laptop, so if you think about it, this is like having a roving 300 foot Wi-Fi hotspot that just travels around you wherever you go. So if you stop for lunch and you go into a restaurant, if you’re within 300 feet of your vehicle you can have a broadband connection.

Now we’re doing this though an exclusive partnership with DirecPC. We are the only mobile service provider for this capability, and today we are providing this for both the land market, the RV market, as well as the Marine market. And this is an important step for KVH because this is the first time that we are an actual service provider in addition to selling the hardware, so we have a recurring revenue stream from the airtime, from the minutes and from the connectivity as well as from selling the hardware.

Now, in the markets we’re in we’ve managed to become a dominant player in the satellite markets. We have accelerating growth in these markets, we’re estimating our 2002 revenues in the satellite segment will be up about 45% year over year. We’ve got about a 75% market share in both the RV market and the Marine market, so we’ve seen very solid growth there, and that’s really come from two areas, one is a very solid distribution channel in the after market, so we’re selling to retail and distributors and dealers, and we also are now for the first time, starting in June of last year, Fleetwood was our first major RV OEM. We’re now selling directly to the vehicle manufacturers. We are now selling to eight of the top ten OEMs, who are selling our satellite TV systems and our Internet systems, directly at the factory as standard equipment or optional equipment.

So we’ve done a good job in the markets that we are in. We’ve shown our ability to enter new markets, and to execute and grow the business, and now we’re expanding into a major new market, which is the automotive market. Back seat video systems are THE fastest growing automotive accessory. This is a tremendous new market for KVH. Obviously there are a lot more cars on the road than there are boats. In the U.S. there are 200 million registered vehicles, and roughly 16 or 17 million new cars built every year. Last year over a million automotive back seat video systems were installed, so this is now no longer a niche market or a specialty product, this is becoming a mainstream product. Not just for SUVs or minivans, but for the automotive market in general, you’re seeing it installed in a wide variety of cars.

This year, all 2003 minivans and SUVs will be offering video, either as standard equipment or as a factory option. Last year, actually 16% of the minivans sold, were sold with the back seat video systems, a very, very rapid adoption. We’re now seeing some very significant numbers, and in some classes of vehicles, those penetration rates are even higher, 31% of Ford Expeditions, 96% of Nissan Quests, 30% of Ford Windstars, so those are real, serious numbers. In fact J.D. Powers and Associates expects this to continue. Their research has shown that 49% of full size SUV owners want video in their next vehicle.

So, if we look at what we think the early adopters are going to be for this technology, is really the minivan market and the SUV market. And within that segment, if you forget the installed base and just look at new construction, you’re still talking about 5 million vehicles a year in that category, and for us, a 1% share of that sub-segment of new vehicles represents a $100 million a year opportunity.

So the main thing that we are doing here is banking on the fact that consumers prefer live programming. Now today, those TV screens, the only thing you can watch on them are pre-recorded media, which is videotapes or DVDs. Research has shown that people, in their cars, even if they have an MP-3 player and a CD player, 70% of the time they listen to the radio. And that’s just because consumers prefer live content, they like the feeling of having real-time information and real-time entertainment.

So, why is it then that people don’t have the capability to have satellite television? And the answer is simply that it hasn’t been done before, that it could not be done technologically. So we’ve spent the last two years applying our in-motion satellite technology and our antenna expertise to the problem of trying to make an antenna that’s attractive enough – you can see it on the top of this small Toyota SUV here, and low cost enough to be affordable for this market.

And that’s the product that we will be introducing tomorrow, it’s the product we’re calling the TracVision A5, “A” for Automotive antenna system, and this really a revolutionary product, it’s a hybrid phased array, a patent pending design. It’s a little difficult to see in the picture here, but there’s hundreds of elements here that are all linked together, tiny sensing cells that are connected via wave guides, the antenna is only about 1 inch thick itself, and it has an electro-magnetic lens that steers the beam.

So the benefit is that the antenna is very flat, and the innovation is that it works in motion and that it is relatively low cost. In terms of what it gives you it provides 300 channels of digital quality satellite television, and you get the 50 music channels that DirecTV and DISH network offer for free as well, so it comes with the television programming.

The product is designed to be very easy to install, it clips onto a roof rack, plugs directly into an existing video system, and we’ve architected it so that it is compatible with our high speed Internet product. We have a growth path here to introduce our TracNet type services to the automotive market using the same antenna. That will be a follow-on product.

So our strategy here really is similar to what we did when we entered the RV market, which was only 2 or 3 years ago, and that is, as I mentioned we are introducing it on Thursday at the Consumer Electronics Show in Las Vegas. The product will be delivered towards the end of the second quarter, and really we have the same introduction strategy that we have used effectively in other markets. The initial distribution will be through after market dealers and distributors.

We have already established a dedicated distribution channel for this product, and at the same time we will be pursuing the vehicle manufacturers in parallel. And that is something, you know, we can’t really push that rope, and we don’t expect to be selling to the vehicle manufacturers as the first customer. As the demand comes from their customers and we’ve proven the demand in the market, then we expect to get the OEMs.

One point I’d also like to make here is that what we won’t be doing is building any infrastructure. This product, unlike satellite radio, does not require building satellites, buying spectrum, launching satellites, or setting up a broadcast center. So all of that infrastructure already exists. We’re simply piggybacking off of all the satellite networks that are already in place and cover all of the United States today.

[audience question on pricing]. The pricing will be somewhere between $2,000 and $2,500, MSRP.

In terms of the infrastructure for what we’ve got in place, we see a lot of growth opportunities for the company, and what we’ve done over the last year is put a very experienced management team in place. We’ve made some key additions. We’ve added a new CFO in the last six months, so we’ve got a very strong management team, we’ve got a proven manufacturing capability, and we’ve been able to double our unit volumes very successfully and grow the business. We’ve got state of the art management systems in place, so we really feel that we have laid the groundwork to grow the business.

A couple of quick financial highlights, we did pre-release our top line and EPS estimates yesterday for Q4. It was a record for us, record quarterly revenue of roughly $13 million, that’s up 48% from a year ago. EPS was positive, it was in line with Needham analyst estimates, to around three cents, and that compares to a loss of about 11 cents a year ago.

For the full year, revenues were up about 45%. As I mentioned, we returned to profitability at mid-year and we have continued, and that’s really important that we have been able to do that, despite the fact that we are spending, for the last couple of years, about 20% on R&D, so before these new products have even come to market, we are above breakeven now, so this is an incremental revenue opportunity.

I think it is also a good validation for our distribution strategy, and the diverse market approach where we have a balance of consumer and defense business.

So to summarize the company, we’ve just finished a breakout year, solid revenue growth despite what happened in the economy, 45% increase, we returned to profitability, we made VERY SIGNIFICANT technological breakthroughs and technology developments.

In our core business we’ve got a couple of good market trends that are helping us, one is the increase in defense spending, the second is the growth in the RV market itself, the vehicle sales for RVs are increasing. So we think right now KVH represents a unique opportunity because the base business is growing, we’ve got improving profitability, we’re launching a breakthrough product, so I think we’ve got some significant upside potential, not just for 2003, but for the years beyond that as well.

Thank you very much.

Brief Q&A before moving to breakout room.

Q. Does this $2,000 to $2,500 include programming?
A. No. The programming is sold separately. We’ll do the activations as we do now, so it will be provided by us through the TV provider, so we’ll handle the actual activation for the consumer.

Q. Then the $2,500 includes the receiver as well?
A. In terms of the installed product you can either use one of our receivers … One second I’ll get that – [audio cut off]

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To: Sector Investor who wrote (1791)1/27/2003 11:46:22 PM
From: Dee Jay
   of 6931
 
thanks very much, Sector - reading that gives some important insights to flesh out the other facts already known.

Dee Jay

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To: david james who started this subject1/29/2003 9:19:21 PM
From: Lonnie
   of 6931
 
Hi,

There is a nice article in IBD, Thursday, 30 Jan, on page A6 about KVHI and RV's!!

Is this the first time KVHI has been mentioned in IBD?

New America next??

Lonnie

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To: Sector Investor who wrote (1791)1/30/2003 1:16:01 PM
From: Sector Investor
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Here is a direct link to the KVH Needham slides and audio from earlier this month. The slides download as a nice Powerpoint presentation.

ir.kvh.com

For completeness I'll add a link to the transcript that I posted a few days ago.

Message 18499228

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To: Lonnie who wrote (1793)1/30/2003 2:00:10 PM
From: robert b furman
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Hi Lonnie,

Thanks for the heads up.

Nice to see a little ink spent on our favorite.

Definitely a future New America stock.

When that happens we'll get a nice IBD bounce.

Bob

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To: robert b furman who wrote (1795)1/30/2003 2:09:09 PM
From: Sector Investor
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I couldn't get a copy of the IBD article. Could anyone post a brief summary about it? TIA

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To: Sector Investor who wrote (1796)1/30/2003 5:42:58 PM
From: Bridge Player
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"So it's only natural that on-the-road internet access would be the next step. KVH industries, etc that specializes in satellite comm gear, last month launched the Trac-Net 2.0 system. It gives RVs high-speed Internet access along with satellite TV and phone service
Such features started as a nich offering an aftermarket addition, say KVH CEO Martin etc. now the firm works with RV makers to include them as a factory option. He predicts they'll be stand on hign-end vehicles.

"People want to be connected anywhere, anytime," says vN H . "That used to mean having a phone, Then it meant television, then Internet, and now broadband Internet."

TV has overtaken phone service as the most requested feature, as most people have their own mobile phones. But the Internet is quickly gaining, he says.

The systems start at $1700 and can run as high as $5000, not including usage charges."

Thats it. The rest of the article is about the amenities that RV owners can get now. Including a picture of a pretty fancy interior of a coach at a base price of only 425G.

Pardon typos, I did this pretty fast.

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To: robert b furman who wrote (1795)1/31/2003 7:02:23 AM
From: Rich1
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So you think this is a good place to buy??

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