DJO Global, Inc. Company Presentation June 2013 Safe Harbor - PowerPoint PPT Presentation

DJO Global, Inc. Company Presentation June 2013

Safe Harbor Statement This presentation has been prepared by DJOFL. The information contained in this presentation is for information purposes only. The information contained in this presentation is not investment or financial product advice and is not intended to be used as the basis for making an investment decision. This presentation has been prepared without taking into account the investment objectives, financial situation or particular needs of any particular person. No representation or warranty, expressed or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in this presentation. To the maximum extent permitted by law, none of DJOFL, its directors, employees or agents, nor any other person accepts any liability, including, without limitation, any liability arising out of fault or negligence for any loss arising from the use of the information contained in this presentation. The historical and projected financial information in this presentation includes financial information that is not presented in accordance with generally accepted accounting principles (GAAP). Non-GAAP financial measures may be considered in addition to GAAP financial information, but should not be used as substitutes for the corresponding GAAP measures. Non-GAAP measures in this presentation may be calculated in a way that is not comparable to similarly titled measures reported by other companies. This presentation includes “forward - looking statements” that reflect DJOFL’s current views and information currently available. This information is, where applicable, based on assumptions and analysis that DJOFL believes, as of the date hereof, provide a reasonable basis for the data contained herein. Forward-looking statements can generally be identified by the use of forward- looking words such as “may”, “will”, “would”, “could”, “expect”, “intend”, “plan”, “aim”, “estimate”, “target”, “anticipate”, “believe”, “continue”, “objectives”, “outlook”, “guidance” or other similar words, and include statements regarding DJOFL’s plans, strategies, objec tives, targets and expected financial performance. Forward-looking statements include statements concerning our plans, objectives, goals, strategies, future events, capital expenditures, future results, our competitive strengths, our business strategy, the trends in our industry and the benefits of and the anticipated cost savings related to our recent acquisitions. These forward-looking statements involve known and unknown risks, uncertainties and other factors, many of which are outside the control of DJOFL and its officers, employees, agents or associates. Actual results, performance or achievements may vary materially from any projections and forward-looking statements and the assumptions on which those forward statements are based. Readers are cautioned not to place undue reliance on forward-looking statements as a predictor of future performance. These forward looking statements are within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, and are intended to be covered by the safe harbors created thereby. Some of the factors that we believe could affect our results include the risks discussed in the “Risk Factors” section in DJOFL’s Annual Report on Form 10 -K for the year ended December 31, 2012, filed on February 27, 2013 with the Securities and Exchange Commission. We caution you that in light of the risks and uncertainties described in this “Risk Factors” section, the matters referred to in the forward looking statements contained in this presentation may not in fact occur. There can be no assurance that the data contained herein is reflective of future performance to any degree. All information herein speaks only as of (1) the date hereof, in the case of information about DJOFL, or (2) the date of such information, in the case of information from persons other than DJOFL. DJOFL undertakes no duty to update or revise the information contained herein, publicly or otherwise. Forecasts and estimates regarding DJOFL’s industry and end markets are based on sources we believe to be reliable, however there can be no assurance these forecasts and estimates will prove accurate in whole or in part. 2

DJO Profile Net Sales and Adjusted EBITDA (1) Business Overview ($ in millions) 4.5% CAGR Net Sales  Headquartered near San Diego, CA 6.2% CAGR Adjusted EBITDA $1,129.4 $1,074.7 $966.0  Approximately 5,300 employees in 27 countries $948.5 $946.2  Leading orthopedic company with unique strategy $262.4 $264.3 $271.0 $250.4 focusing on injury prevention, conservative $212.7 treatment and rehabilitation 2008 2009 2010 2011 2012 Revenue Adjusted EBITDA  Innovator with robust pipeline of products and 2012 Net Sales by Segment solutions that are more cost effective and less invasive than most surgical or pharmaceutical Surgical alternatives Implant 6.5% Bracing and  Solutions that keep people active – “Motion is International Vascular Medicine” 24.8% 39.4%  Financial sponsor – The Blackstone Group Recovery Sciences (1) Adjusted EBITDA for all periods presented excludes impact of non-recurring costs and other adjustments as permitted by Senior Secured Credit Agreement; excludes pre-acquisition EBITDA and future cost savings related to acquisitions. 29.3% 3

Bracing and Vascular 39.4 % of 2012 Sales Bracing Products Vascular Products Bracing and Vascular Highlights Bracing and Vascular Net Sales ($ in millions)  Broad range of soft goods – key to GPO penetration  Innovative rigid bracing, walking boots and cold therapy  Exos thermoformable bracing and splinting $444.4 $388.9  Retail pharmacy offering with Bell Horn $312.2  Vascular systems (DVT prophylaxis) $108.1 $105.8  Broad range of compression therapy garments 2010 2011 2012 Q1-2012 Q1-2013  Diabetic footwear  #1 share in U.S. Bracing and Supports market of approximately (1) 2009 Frost & Sullivan. $1.7 billion (1) (2) Growth rate based on average sales per day. 4

Recovery Sciences 29.3% of 2012 Sales  Home Electrotherapy - TENS Pain  Promotes healing of Non-Union Bone  Clinical Electrotherapy Management & NMES Muscle Fractures and Spinal Repair Surgery  Continuous Passive Motion Stimulation  Clinical Traction Devices  Home Traction Devices  Treatment Tables  Iontophoresis Recovery Sciences Net Sales ($ in millions) $346.6 $341.7 $331.5 $83.7 $75.5 2010 2011 2012 Q1-2012 Q1-2013 (1) Growth rate based on average sales per day. 5

International – 24.8% of 2012 Sales 2012 Sales Mix by Geography International Net Sales ($ in millions) Spain, UK Nordic Benelux & 5.1% 3.5% Germany Italy $279.3 $280.5 29.2% 8.4% $244.5 Canada 8.8% $71.5 $73.9 France ROW 19.7% 25.3% 2010 2011 2012 Q1-2012 Q1-2013 (1) Excludes impact from changes in foreign currency exchange rates (constant currency) and based on average sales per day. 6

Surgical Implant – 6.5% of 2012 Sales Shoulders Knees Hips  Diverse portfolio of orthopedic reconstructive joint products for knees, hips and shoulders  Primary focus on shoulder segment with a track record of innovation – over 50% of net sales  Niche market position with less than 1% share in total, but higher in shoulders  U.S. market over $5 billion (1) Surgical Implant Net Sales ($ in millions) $73.0 $64.9 $62.7 $21.5 $17.9 2010 2011 2012 Q1-2012 Q1-2013 (1) 2006 Frost & Sullivan. (2) Based on average sales per day. 7

Leading Market Positions: Defensible, Comprehensive Product Offering Strong brand names  Market leader in multiple market segments and product categories  Established global presence with over 60 years of history in the physical therapy market and over 30 years of history in orthopedics market  Brand recognition and comprehensive product range promotes loyalty from prescribing physicians and physical therapists  Low regulatory and technology substitution risk 8

Significant Diversification Reduces Risk Sales Channels Patient Need Customers We call on many providers and No customer greater than 3% of We treat a diverse set of patient prescribers minimizing risk that revenue and top 10 customers needs, making us less reliant than products are dispensed beyond our less than 10% of revenue many medical device companies reach on one technology, one reimbursement code, or one treatment protocol 2012 Sales by Segment 2012 Sales by Payor Surgical Medicare / Implants Medicaid 6.5% 6.4% Insurances Healthcare Bracing and International 21.8% Professionals Vascular 24.8% 39.0% 39.4% Recovery Dealers & Sciences Distributors 29.3% 32.8% 9

Diverse Sales Forces Provide Differentiated Presence with Multiple Prescriber & Provider Groups  = primary market(s) Distribution 10

Competitive Advantages in Manufacturing, Distribution and R&D  Main manufacturing facility in Tijuana, Mexico (286,000 square feet) is renowned for operational excellence and low cost manufacturing  Best practices in “lean manufacturing” in all facilities and culture of continuous improvement yield margin expansion  Expanded plant in Tunisia for European products  Vertically integrated manufacturing competencies  Efficient, automated distribution capabilities  Comprehensive mechanical and electronic R&D competencies 11