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Annual Meeting of Stockholders
May 26, 2016
NYSE MKT: HRT
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www.arthrt.com
www.micronproducts.com
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NYSE MKT: HRT
Salvatore Emma, Jr. – President & CEO
Derek T. Welch – CFO
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Safe Harbor Statement
These slides (and the accompanying oral discussion) contain “forward-looking statements” within the meaning
of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks and
uncertainties and should not be considered as guarantees of future performance. The factors that could cause
the actual results of the Company to differ materially from the results expressed or implied by such statements
include but are not limited to our ability to obtain and retain order volumes from customers who represent
significant proportions of net sales; our ability to maintain our pricing model, offset higher costs with price
increases and/or decrease our cost of sales; variability of customer delivery requirements; the level of and
ability to generate sales of higher margin products and services; our ability to renew our credit facility and
manage our level of debt and provisions in the debt agreements which could make the Company sensitive to
the effects of economic downturns and limit our ability to react to changes in the economy or our industry;
failure to comply with financial and other covenants in our credit facility; reliance on revenues from exports
and impact on financial results due to economic uncertainty or downturns in foreign markets; volatility in
commodity and energy prices and our ability to offset higher costs with price increases; continued availability
of supplies or materials used in manufacturing at competitive prices; variations in the mix of products sold;
continued availability of supplies or materials used in manufacturing at competitive prices; and the amount
and timing of investments in capital equipment, sales and marketing, engineering and information technology
resources. More information about factors that potentially could affect the Company's financial results is
included in the Company's Annual Report on Form 10-K and other filings with the Securities and Exchange
Commission.
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Market data as of May 10, 2016, Source: Bloomberg, Shares Outstanding as of March 10, 2016; Ownership as of most recent filing
Who We Are
A diversified contract manufacturing organization that produces
highly-engineered, innovative medical device components
requiring precision machining and injection molding
NYSE MKT
HRT
Market Capitalization
$11.9 million
AVG Daily Volume (3 mos.)
3,500
Recent Closing Price
$4.24
Ownership:
ATF Licensed | FDA Registered
52 Week Low-High
$3.55 - $6.81
.Institutional
21%
Shares Outstanding
2.8 million
.Insider
11%
ISO 13485 Certified
ISO 9001 Certified
ITAR Registered
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Building the Micron Brand
Rapid
Delivery
Machining
and Finishing
Highly
Automated
Precision Injection
Molding
Proprietary
Sensors and
Coating
Contract manufacturing
organization providing value
to Medical, Industrial, and
Automotive OEMs
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Key Growth Drivers
.In-depth plastic injection molding expertise, capability, &
capacity
.Multi-product international business
.Strong and growing focus on medical sector (80% medical)
.Innovative process for new products, capabilities, ideas.
.3 focused business sectors
.Strong, highly motivated team
.Excellent customer portfolio including several major OEMs
.Partnership alliances for logistics and supply
.Expanding product portfolio shipping to 35 countries
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.Rapid production of personalized and off the shelf
implants; offer just-in-time replenishment for customers
.State-of-the-art machining equipment produces complex
components to tight tolerances; best in class surface
finishes
.FDA-registered facilities and ISO 13485 certification
Best-in-class machining and finishing of orthopedic implants & instrumentation
Differentiators
Market Size
$8 billion outsourced market
Machining
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Market Size
Differentiators
Molding
.High-quality automated processes; Engineered-to-order
.Expertise to produce to extremely tight tolerances required
by medical, industrial, consumer and defense markets
.Molding capacity from 15-tons through 300-tons
.More than 35 horizontal and vertical injection molding
machines for high volume and low volume applications
.Environmentally-controlled manufacturing
Forward Looking Infrared Scope Diopter Ring
Class 10,000 Clean Room Molding/Assembly
Festooned Clip for Auto Seat Bolstering
>$300 billion
Expert in high precision injection molding
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Differentiators
Market Size
Sensors
.The Micron process guarantees durability and superior
electrical performance: higher quality, higher yields
.Meets or exceeds all AAMI industry standards and
customer specifications
.FDA-registered facilities and ISO 13485 certification
.Servicing the medical electrode industry since 1978
Leading manufacturer of silver/silver chloride sensors for electrodes
Silver Sensor MicroSense Gemini E3912A2-085
Silver Sensor E3311A2
Silver Sensor Micro Sense Gemini G3911
Nickel Plated Sensor, Micro Sense Gemini MS4205-N
Micro Sense Agility Sensor A4626A2
Micro Sense Agility Sensor A5020A2
MicronSense Radio Translucent Carbon Sensor F4209C
Micro Sense Agility Sensor A4606A2
MicroSense Profile Series Silver Sensor D4208C
$20 million
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NYSE MKT: HRT
Financial Overview
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Net Sales
Machining
•Sales of machined orthopedic implant components was down due to lower than expected
volume from a large customer versus their forecast
Sensors
•Trend to smaller parts, less silver
•Strong US dollar
•Aggressive competition
Custom Thermoplastic Injection Molding
•Increased demand for automotive, consumer and medical device components
2016 Outlook
•Expanded sales force creating new business
•Have added new customers in the second quarter Q2-16
•Orders for new machined and finished orthopedic implants, surgical instruments, and plastic
injection molded components are in production
•Increased orders for the design and manufacture of tooling which is good indication of
future production
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Sales Composition
Medical
78%
Consumer
Products
3%
United
States
62%
Canada
5%
Europe
9%
Asia 23%
Other 1%
By Industry
By Geographic Market
Q1 2016 Revenue (TTM): $20.6 million
Military & Law
Enforcement
5%
Automotive
14%
Orthopedics
25%
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Sales and Profitability Strategy
Top-line Growth
.Expanded sales force
.Strengthen existing customer relationships and grow new opportunities by
cross-selling plastic and machining capabilities.
.Vertical integration, control supply and distribution, do more for customers
.Leverage expertise in engineering and development to manufacture
proprietary products for OEMs
Expand margins and improve profitability
.Drive growth in higher margin markets by expanding manufacturing capacity
and increasing technical capabilities
.Invest in state-of-the-art automation and technology
.Improvement in efficiency and productivity
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Debt Comparison & Outlook
$5.4
$4.4
$4.1
$4.4
2013
2014
2015
3/31/16
Total Debt Comparison
•Increase in 2016 is due to $470k in net draws
from revolver offset by $145k in payments to
service debt
•While there were no draws on the 2015-2016
Equipment Line of Credit (ELOC) in the first
quarter of 2016, there will be in the second
quarter as we continue to acquire equipment
to improve automation and prepare for
growth from new orders in machining
•We continually evaluate our working capital
and capital expenditure requirements, as well
as our credit facilities, to ensure we have
sufficient resources with the best terms to
fund our growth strategy
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Questions
NYSE MKT: HRT
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