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| We are advancing security and well-being every day. May 2007 |
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| 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. May 15, 2007 Safe Harbor |
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| About Federal Signal Key Statistics 5,500 employees $1.2 billion in revenue Trades on NYSE as FSS Key Competitive Advantages Product leadership and brand recognition Broadest array of municipal solutions Diversity of markets and customer base |
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| Segment Revenues $1.2 billion Customer Orders $1.2 billion 2006 Revenues and Orders Environmental Solutions 33% Fire Rescue 32% Tool 10% Safety & Security Systems 25% U.S. Municipal 39% U.S. Industrial/ Commercial 25% Non-U.S. 36% |
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| Product Leadership Drives Our Business 100+ year history of product leadership #1 or #2 in most markets Mission-critical products Trusted brands - proven performance FS Codespear interoperable communications platforms FS Legend Lightbar FS E-ONE Typhoon FS Vactor HXX Vacuum Excavator |
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| Our Global Presence and Expertise Our worldwide capability in security is unmatched. Interoperable industry platform Detroit, Mich. Tsunami warning systems Pudang, Indonesia Parking systems Beijing, China Glycol recovery vehicles St. John's, Newfoundland Industrial security systems Qatar Bronto aerial devices Moscow, Russia Command and control vehicle Chicago, Ill. |
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| PROTECT Foundation for a New Vision |
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| Federal Signal ... the leader in advancing security and well-being for communities and workplaces around the world. |
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| Broadband Wireless Network Community Video Surveillance Outdoor Warning Walking Path Emergency Station Water Meter Reader City Name SCADA IL 129 5678 License Plate Recognition Police Parking Gate Fire Truck City Garage SelecTone Command Smoke Heat Rate of Rise Fire Water Security Alarm Voice EOC Dash Board Warning Toxic Plume Radio TV Cable Satellite Internet Intranet Internet Warning Profiler Vactor Municipality/ Residence Industry/B usiness Vehicular Personnel/C itizen Meteoro- logical Smoke Detector w/ WiFi Cell PDA Pager Personal Warning Toxic Plume School House Child Tracking Elder Monitoring Traffic Light Alarm Monitoring V2V Municipality of the Future |
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| Federal Signal Smart Security Solutions Sense Analyze Command & Control Algorithms & Software Sensors CBNRE Magnetic Field Video/Thermal Climatic Algorithms & Software Prevent, Warn, Respond Recover, Maintain Traditional Federal Signal Products New Federal Signal Solutions |
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| Repositioning Underway Research indicates non- military security market growing at 8% per year worldwide Renamed some businesses to align with customer needs More sales will be into the public safety and security space Enhancing our customer- facing marketing efforts Expecting higher organic growth rates |
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| Growth and Enabling Strategies |
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| Growth Strategy Metrics 2005 2006 2007 Long-term Organic Growth in Orders 2% 12% 8-10% 6-8% Sales % outside U.S. 32% 35% 40% 50% Sales from New Products 9% 12% 15% 30% Target |
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| Enabling Strategy Metrics 2005 2006 2007 Long-term Operating Margin 5.1%* 5.8% 6-7% 10% Operating Working Capital 20% 20% <20% 15% Economic Value ($21 mm) ($12 mm) >$0 15% ROIC Target *Excluding 0.6% impact of product-line divestitures |
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| 2007 Priorities Continue expansion in China Launch initial operations in Eastern Europe Expand comprehensive security solution offerings Integrate one or two technology acquisitions Recover N.A. fire apparatus market share Expand capacity at Vactor/Guzzler and Bronto Increase credit facility to $250 million Achieve 30% growth in EPS |
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| Safety and Security Systems Group Mobile Vehicular Systems Industrial Communications, Safety and Security Public Safety and Transportation Systems Products Lightbars, beacons, sirens and speakers Beacons, horns, interoperable communications systems, mining and marine hazardous area lighting Gates, ticket dispensers, cash registers, card readers, software, all-hazard warning systems, interoperable communications systems Customers Police and fire departments, ambulance services, DOTs, utilities, tow truck operators Industrial plants, petrochemical plants, ship/rig builders, coal mines, municipalities, nuclear plants, military bases Parking operators, airports, municipalities, shopping centers, universities, hospitals, hotels, nuclear plants, military bases Channels Police and truck equipment distributors, catalog houses, installers, OEMs, direct Electrical wholesalers, catalog houses, OEMs, direct Parking equipment distributors, direct Competitors Whelen, Code 3, Ecco Edwards/GE, Gaitronics/Hubbell, Crouse-Hinds/Cooper, Whelen Amano, Ascom, Scheidt & Bachman, SkiData, Whelen, MadahCom |
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| 1st Qtr 2004 247 13.5 2005 277 13.9 2006 305 13.5 1Q06 68 10.9 1Q07 79 12 Safety and Security Systems Group Overview/Outlook Orders rose 18% in 2006 and 24% in 1Q07 Robust demand for police products and electrical products for arduous environments Customers seeking integrated systems for mission-critical situations Integration of FS Codespear Increasing R&D investment Sales ($M) Operating Margin (%) Sales vs. Operating Margin $ % * Excluding gain on product-line sale |
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| Fire Rescue Group Rescue and Homeland Security Pumper and Tanker ARFF Apparatus Aerial Fire Apparatus Products Custom and commercial rescues for command/ operation centers, bomb trucks, HazMat Custom and commercial pumpers and tankers for municipal and industrial markets Apparatus designed for rapid attack and intervention for aircraft or airfield events Aerial waterway, ladders, traditional and articulated devices Customers Cities, Counties, States, Federal Government Cities, Counties, States, Refineries Airports and Military Airbases Cities, Counties, States, Refineries Channels Dealer Network Dealer Network and Direct Sales Direct Sales Dealer Network Competitors Pierce / LDV, SVI, ALF Pierce, Rosenbauer, ALF Oshkosh, Rosenbauer ALF, Pierce, KME Rosenbauer |
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| Fire Rescue Group Overview/Outlook Robust demand for Brontos Enhanced Ez-ONE unveiled Four innovative new trucks launched in April Focused on profitable growth and improved market coverage Sales vs. Operating Margin Sales ($M) Operating Margin (%) 1st Qtr 2004 361 -6.6 2005 371 0.6 2006 385 1.8 1Q06 76 -4 1Q07 70 -3.2 $ % (4%) (3.2%) 1.8% |
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| Environmental Solutions Group Sweepers Vacuum Trucks - Municipal Vacuum Trucks - Industrial Water Blasters Products Street, parking lot and industrial sweepers Sewer and catch basin cleaners, glycol recovery vehicles, hydro excavating vehicles Vacuum loaders that clean up industrial waste or recover and recycle valuable raw materials Water blasters that clean and prepare industrial surfaces Customers Contractors, cities, counties, states, airports Contractors, cities, counties, states, airports Industrial contractors, plants and rental houses Industrial contractors, plants and rental houses Channels Dealers, direct Dealers Direct Direct, distributors Competitors Schwarze, Tymco, Allianz VacCon, Super Products, Clean Earth, Aquatech Super Products, GapVax, VacCon, Clean Earth NLB, Gardner Denver, Woma, Hammelman |
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| Environmental Solutions Group Overview/outlook: Orders rose 21% in 2006 and were flat in 1Q07 Strong growth in vacuum trucks and street sweepers Introducing innovative new products Increased demand from industrial and rental fleets Primary growth focus: globalization Significant investments underway - R&D, systems, China JV plant Sales ($M) Operating Margin (%) Sales vs. Operating Margin 1st Qtr 2004 295 8.6 2005 348 8.3 2006 399 9.3 1Q06 98 8 1Q07 114 8.9 $ % 8.9% |
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| Tool Group Die & Mold Tooling Products Punches, pins, components, retainers, matrices, mold bases Customers Automotive OEMs, injection molders, diecasters Channels Industrial distributors, direct Competitors OME, Progressive, Misumi, Husky, Anchor Danly |
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| Tool Group Overview/outlook: Cutting tool businesses divested Increased international volume Declining automotive market Operational issues stabilized Operating Margin (%) Sales vs. Operating Margin 1st Qtr 2004 122 8.1 2005 124 9.1 2006 123 6.7 1Q06 33 5 1Q07 31 6.9 $ % |
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| Vision Federal Signal ... the leader in advancing security and well-being for communities and workplaces around the world. |