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Investor Relations
December 13, 2012

Monotype
Welcome to the New
Investor Relations
December 13, 2012

Forward-Looking
Statements

2

This presentation contains forward looking statements that involve
significant risks and uncertainties, including those discussed in the
“Risk Factors” section of Monotype Imaging Holdings Inc.’s Form
10-K, as amended, and subsequent filings with the SEC. We are
providing this information as of today’s date and do not undertake
any obligation to update any forward-looking statements contained
in this document as a result of new information, future events or
otherwise. No forward-looking statement can be guaranteed and
actual results may differ materially from those that are projected.
Business Discussion
Doug Shaw

Investor Relations
December 13, 2012

President and CEO

3
Key Takeaways

Investor Relations
December 13, 2012

• Serving large, growing markets undergoing
dynamic change
• Offer real value – Type, Technology and Expertise
• Meaningful growth opportunities – Printer Imaging,
Display Imaging and Creative Professional
• Proven and winning business model

4
Our Vision

Investor Relations
December 13, 2012

Our fonts and technologies empowering
every word and experience.

5
Our Foundation
Heritage Dating
Back 125 Years

350 Employees
10 Countries

Investor Relations
December 13, 2012

Founded in
1986
Long-Term
Customer
Relationships

6
* = Midpoint of guidance given on October 31, 2012

$148.8M Revenue*
$64.0M naEBITDA*
Market Trends
• Seamless access to content as the author intended
• Great user experience

Mobile

7

Implications

Ubiquity
of Screens

Investor Relations
December 13, 2012

Trend

• Immediate access to content regardless of location
• Minimal latency
• Context-specific content

HTML5

• Create content once and distribute everywhere
• Efficient/intuitive creative workflows

Global

• Access to all content in desired language
• Complete design flexibility regardless of language
Our Connected World
200 million
16 billion
connectable
consumer
devices by 2020

active websites
with 571 new
ones created
every minute

$12 billion
global mobile
app/ad market
in 2011 (153%
CAGR since
2008)

150 million

Investor Relations
December 13, 2012

tablets & e-readers
today, growing to
1.1 billion by 2020

8

90% of global 1000
companies will implement
cloud printing services
for mobile personnel
by 2014

Our
World

Source: Kleiner Perkins Caufield Byers; Pew
Research Center; DOMO; NetCraft; On Device
Research; Analysis Mason; Business Insider;
mediaIDEAS; ABI; Gartner Group

43% of

Americans
have read an e-book,
or digital newspaper
or digital magazine

46 million
app downloads from
iTunes store daily

2.3 billion

6.1 billion

Consume

Create

6 million

mobile phones,
with 1 billion
smartphones

internetenabled
cars sold in
2012,
growing to 50
million in
2017

global internet
users – growth
driven by
emerging
markets
CREATIVE PROFESSIONAL

Markets & Requirements
Brands

Graphic
Designers

Bloggers

Publishers

Creative
Directors

News
Organizations

Advertisers

Movie &
TV Studios

Individuals

Browsers

Cable Providers Mobile Networks

Create
• Create once and
distribute everywhere
• Consistent experience
for every user regardless
of consumption medium
• Easy and seamless
creative workflows

Publish/Distribute

9

Computers

OEM

Investor Relations
December 13, 2012

• Solutions that minimize latency
e-Book Readers

ISVs

Televisions

Tablets

Automobiles

Mobile Devices

Printers

Appliances

Consume
• Consume all kinds of content
• Present the content in the form
that the author intended
• Provide an appealing user
experience
Our Business

Investor Relations
December 13, 2012

Creative
Professional

10

~35% Revenue
~35% Revenue

OEM Display
Imaging

}

10-20%
Growth

}

3-10%
Growth

~25% Revenue
~25% Revenue

OEM Printer
Imaging

~40% Revenue
~40% Revenue
OEM Printer Imaging
Market Insights

Growth Initiatives

• Laser printer unit CAGR of 5%
(2012 – 2014)

• Printer drivers

• Emerging markets fueling
growth
• Mobile printing

• Mobile/cloud printing

• Page Description Language
technologies
• Document workflow enhancements

Investor Relations
December 13, 2012

Strategy

11

• Leverage our long term
relationships by providing
additional technology to
reduce cost or capitalize
on new printing paradigms

Laser Printer Market*
$50B
Monotype Opportunity*
$200M

Current Penetration*
~30%
Source: IDC reports
* Management estimates
OEM Printer Imaging
Investor Confusion

2012 PI Highlights

•

•

7 out of 10 OEMs experienced unit
growth…3 OEMs: +20%

•

Monotype realized single digit revenue
growth each quarter

•

Closed first PDL deal with growing
pipeline

•

Gaining traction in mobile printing

Perception that laser printer
market is declining and so may
Monotype’s PI business

Market Dynamics
•

Traditional market leaders have
gone from 54% to 35% share
(2008 – Q3 2012)

Market share gains by Asian
•
vendors which represent +80% of
our PI revenue (Ricoh, Kyocera,
Konica Minolta, Samsung…)

•
Investor Relations
December 13, 2012

•

Unit growth coming from color
multifunction devices, China and
ROW

•

90% of global 1000 companies
will implement mobile printing
(2014)

Source: IDC reports

12

Identified new opportunity to enhance
document workflow
OEM Display Imaging
Market Insights

Growth Initiatives

• Digital displays growing rapidly

• New design wins

• Emerging devices

• Expand within existing accounts
– New models and increased
royalties

•

e-Readers/Tablets: 200M units
(2015)

•

Automotive: 80M units (2014)

•

Mobile: 2.3B units (2016)

•

TVs: 290M units (2014)

• Focus on emerging devices

Display Market*
> $500B

Investor Relations
December 13, 2012

Strategy

13

• Develop innovative solutions to
optimize the use of text on all
digital displays

Monotype Opportunity*
$500M

Current Penetration*
< 10%
Source: IDC, Castellan, Display Search reports
* Management estimates
Go to Market Strategy - OEM
Printer
Imaging

Display
Imaging

Market Leaders
~ 100 customers

Market Leaders
~ 1,000 customers

Business Model

Per Unit Royalties

Per Unit Royalties
Recurring Term Licenses
Perpetual Licenses

Channels

Global Sales Force

Global Sales Force

Partners

System Integrators
ODMs
Adobe

System Integrators
Microsoft

Marketing

Industry Standards
Intimate Customer
Relationships

Thought Leadership (MIT)
Intimate Customer
Relationships

Investor Relations
December 13, 2012

Customers

14
Creative Professional
Market Insights

Growth Initiatives

• Digital publishing evolving
rapidly

• Web font services

• Number of active websites:
644M
• Mobile advertising spend: $8B
(2016) growing at 38%

Strategy

Investor Relations
December 13, 2012

• Our largest business in 2013

15

• Build a bridge for the creative
professional as publishing
needs shift from print to mobile,
web and applications

• Web publishing

• Mobile advertising
• Personalized and dynamic
content

Publishing Market*
> $200B
Monotype Opportunity*
$250M

Current Penetration*
~20%
Source: Forrester, Netcraft reports
* Management estimates
Web Font Services

Typographic Freedom for the Web
• Searchable, scalable text
• 20,000+ fonts for Web design
• Helvetica®, Frutiger®, other exclusives
• Over 40 languages supported

Investor Relations
December 13, 2012

• Instant display of Web pages

16

• Patent pending technology

• SaaS, recurring revenue
Go to Market Strategy - CP
Publishers, Agencies,
Corporate
Thousands of Customers

Professional and Casual
Creatives
Millions of Customers

Business Model

Perpetual Licenses
Recurring Term Licenses

Perpetual Licenses
SaaS Subscriptions

Channels

17

e-Commerce

Customers

Investor Relations
December 13, 2012

Enterprise

Global Sales Force

MyFonts, Fonts.com,
Linotype.com

Partners

Agencies

Adobe
Google
Affiliates

Marketing

Thought Leadership (Brand
Perfect, Pencils to Pixels)

Crowdsourcing
Community
Investor Relations
December 13, 2012

Typefaces
Technology

18

& Expertise
Monotype Libraries

Investor Relations
December 13, 2012

Monotype

19

• Gill Sans
• Soho
• Harmonia
Sans

Linotype
• Helvetica
• DIN Next
• Akko

ITC
• ITC Avant
Garde Gothic
• ITC Conduit
• ITC Charter

Ascender
• Droid Sans
• Kootenay
• Miramonte

Bitstream
• Arrus
• Aphasia
• Nuptial
Technology
Proprietary Technology Provides a Robust Solution
Set
HTML5
CSS3
JavaScript

Investor Relations
December 13, 2012

Edge
Rendering

20

Dynamic
Subsetting

Type
Desktop,
Mobile,
Web

PDLs
Android
& Linux
Investor Relations
December 13, 2012

Expertise

21

Global Team of Consultative Experts
Application of our Technologies
Custom Type Design
Global Language Scripts
W3C and ISO Standards
Web Typography
Primary Research
Products & Services

Investor Relations
December 13, 2012

Fonts &
Design Services

22

• Fonts
• Web Fonts
• Custom
Design

Screen Imaging

• iType
• WorldType
• iType
Connects

Print Imaging

Font Management

• FontExplorer
• UFST
• Fontwise
• PDLs
• Printer Drivers

Creative Tools

• Web Font
Services
• Typecast
• SkyFonts
Solutions

Investor Relations
December 13, 2012

Automotive

23

Document
Workflow

Tablets &
e-Readers

ISVs

White Goods

Mobile

Branding &
Design Agencies
Business Model and Financials
Scott Landers

Investor Relations
December 13, 2012

SVP and CFO

24
2012 Highlights
Financial
RevenueG
•

$148.8M ↑21%

naEBITDAG
•

$64.0M ↑17%, 43% mgn

ngEPSG
•

$1.03 ↑17%

CFFOE
Investor Relations
December 13, 2012

•

25

~$48M

Business
Creative Professional
•
•
•

> 60% growth
MyFonts
Web Fonts ~ $5M

Display Imaging
•
•
•

~25% of revenue
Doubled since 2010
e-Readers, Automotive

Printer Imaging
•
•
•

3-5% unit growth
7 of 10 OEMs experiencing
unit growth
First PDL win

G = Midpoint of guidance given on October 31, 2012
E = Management estimate as of December 5, 2012

Other
Acquisitions
• Bitstream
• Design By Front
Engineering
• India presence
Cash Flow
• Paid for Bitstream
in first year
Business Model
Diversified

Investor Relations
December 13, 2012

Profitable

26

Defensible

Growing

Recurring
and
Predictable
Defensible

Technology

Investor Relations
December 13, 2012

Typefaces

27

• More than 16,000 fonts
• Global library
• Trademarks are perpetual

• Proprietary technology
• 40% employees are engineers

Expertise

• Customized solutions
Diversified Revenue
Streams

Investor Relations
December 13, 2012

Creative
Professional

28

~35% Revenue
~35% Revenue

OEM Display
Imaging

}

10-20%
Growth

}

3-10%
Growth

~25% Revenue
~25% Revenue

OEM Printer
Imaging

~40% Revenue
~40% Revenue
Investor Relations
December 13, 2012

Diversified Customer Base

29
Recurring and Predictable Revenue
Perpetual licenses
Non-recurring services
NonRecurring
10 - 15%

High volume web
transactions
Services run rate

Predictable
15 - 20%

Investor Relations
December 13, 2012

Recurring
65 - 70%

30

~85% Recurring/Predictable

Per unit royalties
Renewable term licenses
Maintenance
Web font services
Revenue
$170

’05 – ’08
15%
CAGR

’09 – ’13
15%
CAGR

$165.2
$148.8

$150
$130
$110

$123.2
$105.2

$110.9

$106.7
$94.0

Investor Relations
December 13, 2012

$90
$70
$50
2007

2008

2009

G = Midpoint of guidance given on October 31, 2012

31

2010

2011

2012G 2013G
naEBITDA
$75
$70
$65

’05 – ’08
10%
CAGR

’09 – ’13
14%
CAGR

$70.2
$64.0

$60
$54.6

$55
$50

$48.1

$48.9

Investor Relations
December 13, 2012

$45

32

$47.8
$41.0

$40
$35
$30

2007

2008

2009

2010

G = Midpoint of guidance given on October 31, 2012
Note: Reconciliations of all non-GAAP measures are available at Monotype.com

2011

2012G 2013G
Net Income and ngEPS
$30

26% Net Income CAGR

$28.5

$1.20

$1.10

$25

$22.7
$1.03

$20

$18.4

$1.00
$0.90

$15.4

$15
$10

$0.80

$13.4

$0.70

$9.1

$0.60

Investor Relations
December 13, 2012

$5

33

$0.50
$0.53

$0

$0.40
2007*

2008

2009

2010

G = Midpoint of guidance given on October 31, 2012
* = 2007 ngEPS based on post IPO shares outstanding

2011

2012G
Cash Flow from Operations
70% Increase since 2008

$50

$43.7

$45

75%+
Cash for M&A,
debt reduction
and cash
replenishment

$39.3

$40
$35
$30

$48.0

$30.5
$27.3

$28.1

$25
$20

$15
$10
Investor Relations
December 13, 2012

$5
$0
2007

2008

2009

E = Management estimate as of November 20, 2012

34

2010

2011

2012E

Up to 25%
Cash available
for dividends or
share
repurchase
Dividend Program

Investor Relations
December 13, 2012

• Confidence in our business model and strategic plan
• Current quarterly rate of $0.04 per share of common
stock or $0.16 annually
• Capital allocation strategy supports growth and M&A,
while providing an additional source of equity return
• Goal to increase dividend over time

35
Goals and Outlook
Long Term Goals
•

Double digit organic
revenue growth

•

Tuck-in acquisitions

•

Net adjusted EBITDA =
40%+

•

Margin expansion with
revenue growth > 10%

Investor Relations
December 13, 2012

•

36

Strong cash flow
generation

DI
~25% Revenue

Recurring revenue

•

CP
~35% Revenue

•

Increased dividend

PI
~40% Revenue
Key Takeaways

Investor Relations
December 13, 2012

• Serving large, growing markets undergoing
dynamic change
• Offer real value – Type, Technology and Expertise
• Meaningful growth opportunities – Printer Imaging,
Display Imaging and Creative Professional
• Proven and winning business model

37

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Investor Presentation

  • 1. 1 Investor Relations December 13, 2012 Monotype Welcome to the New
  • 2. Investor Relations December 13, 2012 Forward-Looking Statements 2 This presentation contains forward looking statements that involve significant risks and uncertainties, including those discussed in the “Risk Factors” section of Monotype Imaging Holdings Inc.’s Form 10-K, as amended, and subsequent filings with the SEC. We are providing this information as of today’s date and do not undertake any obligation to update any forward-looking statements contained in this document as a result of new information, future events or otherwise. No forward-looking statement can be guaranteed and actual results may differ materially from those that are projected.
  • 3. Business Discussion Doug Shaw Investor Relations December 13, 2012 President and CEO 3
  • 4. Key Takeaways Investor Relations December 13, 2012 • Serving large, growing markets undergoing dynamic change • Offer real value – Type, Technology and Expertise • Meaningful growth opportunities – Printer Imaging, Display Imaging and Creative Professional • Proven and winning business model 4
  • 5. Our Vision Investor Relations December 13, 2012 Our fonts and technologies empowering every word and experience. 5
  • 6. Our Foundation Heritage Dating Back 125 Years 350 Employees 10 Countries Investor Relations December 13, 2012 Founded in 1986 Long-Term Customer Relationships 6 * = Midpoint of guidance given on October 31, 2012 $148.8M Revenue* $64.0M naEBITDA*
  • 7. Market Trends • Seamless access to content as the author intended • Great user experience Mobile 7 Implications Ubiquity of Screens Investor Relations December 13, 2012 Trend • Immediate access to content regardless of location • Minimal latency • Context-specific content HTML5 • Create content once and distribute everywhere • Efficient/intuitive creative workflows Global • Access to all content in desired language • Complete design flexibility regardless of language
  • 8. Our Connected World 200 million 16 billion connectable consumer devices by 2020 active websites with 571 new ones created every minute $12 billion global mobile app/ad market in 2011 (153% CAGR since 2008) 150 million Investor Relations December 13, 2012 tablets & e-readers today, growing to 1.1 billion by 2020 8 90% of global 1000 companies will implement cloud printing services for mobile personnel by 2014 Our World Source: Kleiner Perkins Caufield Byers; Pew Research Center; DOMO; NetCraft; On Device Research; Analysis Mason; Business Insider; mediaIDEAS; ABI; Gartner Group 43% of Americans have read an e-book, or digital newspaper or digital magazine 46 million app downloads from iTunes store daily 2.3 billion 6.1 billion Consume Create 6 million mobile phones, with 1 billion smartphones internetenabled cars sold in 2012, growing to 50 million in 2017 global internet users – growth driven by emerging markets
  • 9. CREATIVE PROFESSIONAL Markets & Requirements Brands Graphic Designers Bloggers Publishers Creative Directors News Organizations Advertisers Movie & TV Studios Individuals Browsers Cable Providers Mobile Networks Create • Create once and distribute everywhere • Consistent experience for every user regardless of consumption medium • Easy and seamless creative workflows Publish/Distribute 9 Computers OEM Investor Relations December 13, 2012 • Solutions that minimize latency e-Book Readers ISVs Televisions Tablets Automobiles Mobile Devices Printers Appliances Consume • Consume all kinds of content • Present the content in the form that the author intended • Provide an appealing user experience
  • 10. Our Business Investor Relations December 13, 2012 Creative Professional 10 ~35% Revenue ~35% Revenue OEM Display Imaging } 10-20% Growth } 3-10% Growth ~25% Revenue ~25% Revenue OEM Printer Imaging ~40% Revenue ~40% Revenue
  • 11. OEM Printer Imaging Market Insights Growth Initiatives • Laser printer unit CAGR of 5% (2012 – 2014) • Printer drivers • Emerging markets fueling growth • Mobile printing • Mobile/cloud printing • Page Description Language technologies • Document workflow enhancements Investor Relations December 13, 2012 Strategy 11 • Leverage our long term relationships by providing additional technology to reduce cost or capitalize on new printing paradigms Laser Printer Market* $50B Monotype Opportunity* $200M Current Penetration* ~30% Source: IDC reports * Management estimates
  • 12. OEM Printer Imaging Investor Confusion 2012 PI Highlights • • 7 out of 10 OEMs experienced unit growth…3 OEMs: +20% • Monotype realized single digit revenue growth each quarter • Closed first PDL deal with growing pipeline • Gaining traction in mobile printing Perception that laser printer market is declining and so may Monotype’s PI business Market Dynamics • Traditional market leaders have gone from 54% to 35% share (2008 – Q3 2012) Market share gains by Asian • vendors which represent +80% of our PI revenue (Ricoh, Kyocera, Konica Minolta, Samsung…) • Investor Relations December 13, 2012 • Unit growth coming from color multifunction devices, China and ROW • 90% of global 1000 companies will implement mobile printing (2014) Source: IDC reports 12 Identified new opportunity to enhance document workflow
  • 13. OEM Display Imaging Market Insights Growth Initiatives • Digital displays growing rapidly • New design wins • Emerging devices • Expand within existing accounts – New models and increased royalties • e-Readers/Tablets: 200M units (2015) • Automotive: 80M units (2014) • Mobile: 2.3B units (2016) • TVs: 290M units (2014) • Focus on emerging devices Display Market* > $500B Investor Relations December 13, 2012 Strategy 13 • Develop innovative solutions to optimize the use of text on all digital displays Monotype Opportunity* $500M Current Penetration* < 10% Source: IDC, Castellan, Display Search reports * Management estimates
  • 14. Go to Market Strategy - OEM Printer Imaging Display Imaging Market Leaders ~ 100 customers Market Leaders ~ 1,000 customers Business Model Per Unit Royalties Per Unit Royalties Recurring Term Licenses Perpetual Licenses Channels Global Sales Force Global Sales Force Partners System Integrators ODMs Adobe System Integrators Microsoft Marketing Industry Standards Intimate Customer Relationships Thought Leadership (MIT) Intimate Customer Relationships Investor Relations December 13, 2012 Customers 14
  • 15. Creative Professional Market Insights Growth Initiatives • Digital publishing evolving rapidly • Web font services • Number of active websites: 644M • Mobile advertising spend: $8B (2016) growing at 38% Strategy Investor Relations December 13, 2012 • Our largest business in 2013 15 • Build a bridge for the creative professional as publishing needs shift from print to mobile, web and applications • Web publishing • Mobile advertising • Personalized and dynamic content Publishing Market* > $200B Monotype Opportunity* $250M Current Penetration* ~20% Source: Forrester, Netcraft reports * Management estimates
  • 16. Web Font Services Typographic Freedom for the Web • Searchable, scalable text • 20,000+ fonts for Web design • Helvetica®, Frutiger®, other exclusives • Over 40 languages supported Investor Relations December 13, 2012 • Instant display of Web pages 16 • Patent pending technology • SaaS, recurring revenue
  • 17. Go to Market Strategy - CP Publishers, Agencies, Corporate Thousands of Customers Professional and Casual Creatives Millions of Customers Business Model Perpetual Licenses Recurring Term Licenses Perpetual Licenses SaaS Subscriptions Channels 17 e-Commerce Customers Investor Relations December 13, 2012 Enterprise Global Sales Force MyFonts, Fonts.com, Linotype.com Partners Agencies Adobe Google Affiliates Marketing Thought Leadership (Brand Perfect, Pencils to Pixels) Crowdsourcing Community
  • 18. Investor Relations December 13, 2012 Typefaces Technology 18 & Expertise
  • 19. Monotype Libraries Investor Relations December 13, 2012 Monotype 19 • Gill Sans • Soho • Harmonia Sans Linotype • Helvetica • DIN Next • Akko ITC • ITC Avant Garde Gothic • ITC Conduit • ITC Charter Ascender • Droid Sans • Kootenay • Miramonte Bitstream • Arrus • Aphasia • Nuptial
  • 20. Technology Proprietary Technology Provides a Robust Solution Set HTML5 CSS3 JavaScript Investor Relations December 13, 2012 Edge Rendering 20 Dynamic Subsetting Type Desktop, Mobile, Web PDLs Android & Linux
  • 21. Investor Relations December 13, 2012 Expertise 21 Global Team of Consultative Experts Application of our Technologies Custom Type Design Global Language Scripts W3C and ISO Standards Web Typography Primary Research
  • 22. Products & Services Investor Relations December 13, 2012 Fonts & Design Services 22 • Fonts • Web Fonts • Custom Design Screen Imaging • iType • WorldType • iType Connects Print Imaging Font Management • FontExplorer • UFST • Fontwise • PDLs • Printer Drivers Creative Tools • Web Font Services • Typecast • SkyFonts
  • 23. Solutions Investor Relations December 13, 2012 Automotive 23 Document Workflow Tablets & e-Readers ISVs White Goods Mobile Branding & Design Agencies
  • 24. Business Model and Financials Scott Landers Investor Relations December 13, 2012 SVP and CFO 24
  • 25. 2012 Highlights Financial RevenueG • $148.8M ↑21% naEBITDAG • $64.0M ↑17%, 43% mgn ngEPSG • $1.03 ↑17% CFFOE Investor Relations December 13, 2012 • 25 ~$48M Business Creative Professional • • • > 60% growth MyFonts Web Fonts ~ $5M Display Imaging • • • ~25% of revenue Doubled since 2010 e-Readers, Automotive Printer Imaging • • • 3-5% unit growth 7 of 10 OEMs experiencing unit growth First PDL win G = Midpoint of guidance given on October 31, 2012 E = Management estimate as of December 5, 2012 Other Acquisitions • Bitstream • Design By Front Engineering • India presence Cash Flow • Paid for Bitstream in first year
  • 26. Business Model Diversified Investor Relations December 13, 2012 Profitable 26 Defensible Growing Recurring and Predictable
  • 27. Defensible Technology Investor Relations December 13, 2012 Typefaces 27 • More than 16,000 fonts • Global library • Trademarks are perpetual • Proprietary technology • 40% employees are engineers Expertise • Customized solutions
  • 28. Diversified Revenue Streams Investor Relations December 13, 2012 Creative Professional 28 ~35% Revenue ~35% Revenue OEM Display Imaging } 10-20% Growth } 3-10% Growth ~25% Revenue ~25% Revenue OEM Printer Imaging ~40% Revenue ~40% Revenue
  • 29. Investor Relations December 13, 2012 Diversified Customer Base 29
  • 30. Recurring and Predictable Revenue Perpetual licenses Non-recurring services NonRecurring 10 - 15% High volume web transactions Services run rate Predictable 15 - 20% Investor Relations December 13, 2012 Recurring 65 - 70% 30 ~85% Recurring/Predictable Per unit royalties Renewable term licenses Maintenance Web font services
  • 31. Revenue $170 ’05 – ’08 15% CAGR ’09 – ’13 15% CAGR $165.2 $148.8 $150 $130 $110 $123.2 $105.2 $110.9 $106.7 $94.0 Investor Relations December 13, 2012 $90 $70 $50 2007 2008 2009 G = Midpoint of guidance given on October 31, 2012 31 2010 2011 2012G 2013G
  • 32. naEBITDA $75 $70 $65 ’05 – ’08 10% CAGR ’09 – ’13 14% CAGR $70.2 $64.0 $60 $54.6 $55 $50 $48.1 $48.9 Investor Relations December 13, 2012 $45 32 $47.8 $41.0 $40 $35 $30 2007 2008 2009 2010 G = Midpoint of guidance given on October 31, 2012 Note: Reconciliations of all non-GAAP measures are available at Monotype.com 2011 2012G 2013G
  • 33. Net Income and ngEPS $30 26% Net Income CAGR $28.5 $1.20 $1.10 $25 $22.7 $1.03 $20 $18.4 $1.00 $0.90 $15.4 $15 $10 $0.80 $13.4 $0.70 $9.1 $0.60 Investor Relations December 13, 2012 $5 33 $0.50 $0.53 $0 $0.40 2007* 2008 2009 2010 G = Midpoint of guidance given on October 31, 2012 * = 2007 ngEPS based on post IPO shares outstanding 2011 2012G
  • 34. Cash Flow from Operations 70% Increase since 2008 $50 $43.7 $45 75%+ Cash for M&A, debt reduction and cash replenishment $39.3 $40 $35 $30 $48.0 $30.5 $27.3 $28.1 $25 $20 $15 $10 Investor Relations December 13, 2012 $5 $0 2007 2008 2009 E = Management estimate as of November 20, 2012 34 2010 2011 2012E Up to 25% Cash available for dividends or share repurchase
  • 35. Dividend Program Investor Relations December 13, 2012 • Confidence in our business model and strategic plan • Current quarterly rate of $0.04 per share of common stock or $0.16 annually • Capital allocation strategy supports growth and M&A, while providing an additional source of equity return • Goal to increase dividend over time 35
  • 36. Goals and Outlook Long Term Goals • Double digit organic revenue growth • Tuck-in acquisitions • Net adjusted EBITDA = 40%+ • Margin expansion with revenue growth > 10% Investor Relations December 13, 2012 • 36 Strong cash flow generation DI ~25% Revenue Recurring revenue • CP ~35% Revenue • Increased dividend PI ~40% Revenue
  • 37. Key Takeaways Investor Relations December 13, 2012 • Serving large, growing markets undergoing dynamic change • Offer real value – Type, Technology and Expertise • Meaningful growth opportunities – Printer Imaging, Display Imaging and Creative Professional • Proven and winning business model 37