© 2009 Guidance Software, Inc. All Rights Reserved. The Leader in eDiscovery and Digital Investigations RBC Capital Markets 2009 Technology, Media & Communications Conference NASDAQ: GUID June 2009 Exhibit 99.01 |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 1 Forward Looking Statements This presentation contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that forward-looking statements in this presentation involve risks and uncertainties that could cause actual results to differ materially from current expectations. There can be no assurance that demand for the company's products will continue at current or greater levels, or that the company will continue to grow revenues, or be profitable. There are also risks that: the company's pursuit of providing network security and eDiscovery technology might not be successful, or that if successful, it will not materially enhance the company's financial performance; the company could fail to retain key employees; changes in customer requirements and other general economic and political uncertainties could impact the company's relationship with its customers; delays in product development, competitive pressures or technical difficulties could impact timely delivery of next-generation products; and other risks and uncertainties that are described from time to time in Guidance Software's periodic reports and registration statements filed with the Securities and Exchange Commission. The company specifically disclaims any responsibility for updating these forward-looking statements. |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 2 Guidance Software The World Leader in Digital Investigations Large, Global Customer Base Over 30,000 users of EnCase ® Forensic worldwide Over 650 customers of EnCase ® Enterprise including: — 50% of the Fortune 100 and nearly 25% of the Fortune 500 — Over 150 EnCase ® eDiscovery customers — Deployed on millions of desktops, laptops, and servers Global government agencies including: — FBI, DOJ, SEC, DOD, NATO, UK Foreign & Commonwealth Office, others of significance The Leading Court-Validated Technology Used in hundreds of thousands of cases worldwide Mentioned by name in over 70 published court cases Validated under Daubert/Frye — Courts have taken judicial notice of the validity of EnCase software World-Class Training Program Over 6,000 corporate, law enforcement & government professionals trained annually Industry esteemed EnCE ® (EnCase Certified Examiner) training certification Top-Ranked Professional Services Organization “Top 5” eDiscovery Software & Services Provider in Socha-Gelbmann survey |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 3 Guidance Software Opportunities and Drivers for Growth eDiscovery Market entering shift from Services to Software Rapid ROI to Customers Implementation is weeks, not months or years ROI realized on first cases and investigations Immediate operating cost reductions in Legal and IT Flexible pricing to meet customer needs and economic realities Perpetual pricing – Buy it once and pay ongoing maintenance Pay-Per-Use pricing – Pay per case with no upfront license fee New Product Introductions during 2009 EnCase ® Legal Hold (Q2 Release) – extends our eDiscovery value proposition EnCase ® Portable (Q3 Release) – opens up an entire new segment of users EnCase ® Cybersecurity (Q3 Release) – address #1 customer concern: the unknown threat |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 4 The EnCase ® Enterprise Platform and Add-on Products “Guidance “Guidance Software’s solution addresses virtually every aspect of eDiscovery and information security.” Litigation Counsel, Dell |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 5 EnCase ® eDiscovery and Legal Hold Expanding the EnCase eDiscovery platform |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 6 Product Leadership Key EnCase® Features Automated search, identification, collection, preservation, and processing Does not alter metadata – preserves it in Evidence Files throughout the electronic discovery process Maintains control of ESI and chain of custody Push-button load file creation for leading review platforms Distributed architecture for fastest response No upfront indexing Leverages laptops, desktops, and servers across the network Highly scalable enterprise solution Operates across network from central location Non-intrusive to custodians, works without business interruption Connectors to leading ECM solutions |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 7 Product Leadership Key EnCase® Features EnCase Evidence File is the standard preservation / authentication mechanism for digital evidence Integrated solution – from “Legal Hold to Load File” – provides speed and cost advantages Foreign language support For example, searches can be run with a mix of English and Asian language key words in the same search expression Leverages a common platform for enterprise digital investigations |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 8 EnCase ® eDiscovery Pay-Per-Use Overview and Key Benefits What is Pay-Per-Use? EnCase eDiscovery paid for on a usage basis Installed behind the firewall – same software used by perpetual license customers Key Benefits Low upfront cost – pay upfront only for training and implementation Cost is based on actual usage – data searched, collected, processed, and delivered as load files – with monthly bills per case Use operating, rather than capital, budgets Facilitates internal charge-backs Possible insurance reimbursement |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 9 EnCase ® Legal Hold Browser-based GUI Provides notification of a Legal Hold to custodians Create customized, case-related interview style questions for custodians Receives, compiles, and analyzes text-based answers from a custodian Schedules and sends recurring notifications To remind custodians they are subject to the Legal Hold To custodians who have not yet submitted their answers Full audit trail to monitor and enforce legal hold compliance Provides lawyers / paralegals ability to review all cases, custodians, data collections, data processing, etc. |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 10 EnCase ® Portable Benefits Provides automated forensic evidence search and acquisition capabilities from a thumb drive Enables users to search and collect data when — Target systems cannot be transported to a lab environment — Ultra portability is needed; transporting laptops with EnCase Forensic to the collection site is not possible — Acquisition on multiple systems simultaneously with laptops is cost prohibitive — Experienced personnel cannot be used for the collection of evidence Ease of Use – Novice computer user can be trained on the use of EnCase® Portable in a matter of minutes All in One Solution – EnCase® Portable is ready to use out of the box, just plug in and collect Ultra-portability – Everything needed fits in small case, take it anywhere Stealth Operation – Search and Collect without leaving a trace you were ever there Power of EnCase® - Data collected with EnCase® Portable is stored in the forensically sound, court validated EnCase® Logical Evidence File (LEF) format |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 11 EnCase ® Portable: Use Cases Law Enforcement - enable non-forensic experts in remote locations to collect evidence and send to regional lab for analysis Parole Officers - can collecting internet history and email artifacts to ensure parolees are complying with the terms of their parole Field Operatives - military personnel in hostile operating areas can rapidly collect potential intelligence data from computer systems found in the execution of patrols Law Firms - can assign collection duties to paralegals without the need to train them to be forensic experts Corporations - can assign collection jobs to novice personnel anywhere in the world |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 12 EnCase ® Cybersecurity Value Proposition Proactively audit for sensitive data and recover from classified spillage Proactively identify and recover from covert threats Determine threat level of endpoints Analyze process code Remediate registry entries, files, processes Identify malware, even if it changes Triage incidents across worldwide networks Combat insider threats Maintain endpoints in a trusted state Ensure compliance with government configuration standards |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 13 Summary EnCase Enterprise + EnCase eDiscovery = Fast ROI for Customer eDiscovery and Forensic investigation leader Customers are just starting to transition from expensive services-based offerings to technology / software solutions New Product Offerings expand reach EnCase ® Legal Hold EnCase ® Portable Encase ® Cybersecurity |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 14 Financial Information |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 15 Q1 2009 Financial Results Q1 Results $18.7 million Total Revenue, 14% year over year decline Tough economic environment after record Q3 and Q4 2008 $0.14 Q1 EPS Loss, excluding share-based compensation Initiated cost reduction measures beginning of Q2 Customers 21 New EnCase ® Enterprise customers in Q1 (vs 17 in prior year) 26 New EnCase ® eDiscovery customers in Q1 (vs 8 in prior year) 21 New Pay-Per-Use eDiscovery customers in Q1 Customer acquisition in 2008 was strong with 112 Enterprise and 60 new eDiscovery customers Balance Sheet $37.0 million in cash No debt DSOs 83 days – 8 day improvement over Q4 2008 $31.1 million in deferred revenues |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 16 Annual Revenue Growth 0 10 20 30 40 50 60 70 80 90 100 2004 2005 2006 2007 2008 ($ in M) $27.6 $39.5 $55.9 $78.9 $91.5 $11.8 $15.8 $16.4 $23.1 $32.6 $23.3 $27.2 $9.8 $16.3 $20.2 Product Revenue Consulting, Training, & Maintenance Revenue Deferred Revenue $44.3 $34.6 $33.3 $43.2 $48.3 |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 17 Quarterly Revenue Growth 2004 2006 2005 Product Revenue Consulting, Training & Maintenance Revenue 2007 ($ in M) $5.0 $5.0 $6.5 $6.5 $7.5 $7.5 $8.5 $8.5 $7.8 $7.8 $9.0 $9.0 $10.3 $10.3 $12.4 $12.4 $11. 2 $11. 2 $12.9 $12.9 $14.8 $14.8 $17.0 $17.0 $17.6 $17.6 $18.5 $18.5 $20.3 $20.3 $22.5 $22.5 2008 $21.7 $21.7 $21.5 $21.5 $23.1 $23.1 $25.2 $25.2 2009 $18.7 $18.7 |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 18 Revenue Composition Fiscal Year 2008 Total Company Revenue By Geography Total Company Revenue By Geography Enterprise License Revenue By Industry Enterprise License Revenue By Industry Public Sector (State & Local, Federal, & Foreign Government) 26% Media High Tech Telecomm 11% Energy & Utilities 4% Automotive & Transportation 2% Biotech Health Care Pharmaceuticals 6% Retail & Consumer Products 15% Other 5% US 79% Europe 14% Asia 5% Other 2% Industrials & Manufacturing 12% Education < 1% Insurance 6% Banking & Financials 13% |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 19 Operating Model Revenues: Q4 2008 2 – 3 Years Product 56% 55 - 60% EnCase Enterprise 41% EnCase Forensic 15% Services and Maintenance 44% 40 - 45% Professional Services 12% Training 10% Maintenance 22% 100% 100% Gross Margin 75.8% 75 - 78% Operating Expenses: Product Development 12.7% 13 - 15% Sales and Marketing 37.5% 33 - 35% General and Administrative 17.1% 12 - 14% Depreciation and Amortization 4.1% 4 - 5% Operating Margin 4.4% 10 - 14% (Excludes share-based compensation) |
© 2009 Guidance Software, Inc. All Rights Reserved. P A G E 20 |