AIVTECH INTERNATIONAL GROUP CO. (OTC BB: ECOH) March 2011
Safe Harbor Statement Safe Harbor Statement for Purposes of the “Safe Harbor” Provisions of the Private Securities Litigation Reform Act of 1995: This presentation contains “forward-looking” statements, which are not historical facts, but are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to analyses and other information based on forecasts of future results and estimates of amounts not yet determinable. These statements also relate to our future prospects and proposed new products, services, developments or business strategies. These forward-looking statements are identified by their use of terms and phrases such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “intend”, “may”, “plan”, “predict”, “project”, “will”, “continue” and other similar terms and phrases, including references to assumptions. Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to changes and to inherent known and unknown risks and uncertainties. We do not intend, and undertake no obligation, to update our forward-looking statements to reflect future events or circumstances.
Company Overview Provider of originally designed consumer electronics ~ 80 products in three product divisions High-quality Audio Furniture – Primary supplier of electronic components Multimedia Speakers  Video Products Founded in 2004: 323,000 square  foot  manufacturing facility in Dongguan China, Guangdong Province Strong Brand, AIV (Audio and Interactive Video) Strong financial growth (First 9 months of 2010) Revenue: $56.2 million  ▲ 102% YOY Net Income: $9.8 million or $0.49/share ▲ 81.5% YOY
Select Financials Fiscal Year End:  December 31 st   Symbol: (OTC BB: ECOH) Stock Price (3/2/2011): $2.08 Shares Outstanding (12/30/2010): 22.5 million  Fully Diluted Shares Outstanding (12/30/2010): 22.8 million Market Cap: $47 million Q3 2010 Revenue: $27.5 million ▲ 72.0 % YOY  Q3 2010 Net Income: $4.4 million ▲ 27.8 % YOY  Q3 2010 EPS: $0.22 ▲ 29.4 % YOY  2010 Revenue (first 9 mos.): $56.2 million ▲ 102% YOY 2010 Net Income (first 9 mos.): $9.8 million ▲ 81.6% YOY 2010 Make Good EPS: $0.44 2011 Make Good EPS: $0.60 2011 EPS Guidance: $0.61 Auditor Friedman LLP Legal Counsel: Anslow & Jaclin LLP
Revenue Breakdown 2010 First Nine Month Product Revenue Audio Furniture 65.4% LED TV 21.1% Multi-Media Speakers 13.5% First 9 Months of 2010 2009 % of Sales 2010 % of Sales YOY Change Gross Profit Margins Audio Furniture $22.2M 80% $36.8M 65.4% ▲  65.8% 26% Multimedia Speakers $5.6M 20% $7.6M 13.5% ▲  35.7% 24% Video Products $ -  -  $11.9M 21.1% - 15% Total  $27.8M $56.2M ▲  103% 21.7%
Competitive Advantage
Proprietary Technology 50 People on R&D team with budget 8-9% of employees Plan to quadruple the team within the next 5 years 11 patents, 6 software copyrights, hundreds of certifications  Patented Products Digital speaker with audio and video function Multimedia furniture chair with audio Core Technology Includes: Integrating multimedia digital products with furniture Ergonomic design features Key technology and application of a digital family doctor Ergonomic IT130
Awards/Certificates ISO9001: 2000 China Compulsory Certification (3C) South Korea electrical and electronic research institute Hong Kong standards and testing product certification European Union CE certification State FCC certification
30,000 Sq. Meter Facility Located in Dongguan, Guangdong Province with 600+ employees Utilization rate with one 12-hour shift: 90%.  Capacity can be expanded by: Overtime - up to 80 hours per month overtime Outsource production  Build new facility Production cycle  Existing products: 12-18 days New products: 15-21 days
Sales and Distribution Overview Audio Furniture Ace Bayou is recipient of products through Chinese furniture distributor  90% final sales in US, 10% in Europe ODM under X Rocker and V Rocker names Multimedia Speakers 100% of sales in China 20 distributors 50% under AIV brand / 50% ODM, OEM LED TV’s 100% of final sales in Europe Two distributors: Germany and Belgium (Qmedia, ALDI, Dixons) ODM model 2010 First Nine Month Sales by Distributor Da Kang 31.5% Other 12.5% Anji Chaoya 12.4% Guangdong Guanghong 34% Beijing Huaqi 5.2% Anji Weiyu  4.1%
High-Quality Audio Furniture Mainly electronic chairs Currently 12 models; several prototypes in pipeline 4 types of chairs: Gaming chair Music chair IT chair Health chair ODM Model:  Primary supplier of value added electronic components
Gaming Chair Award winning; PS and Xbox compatible 60% of total market share 90% final sales in US; 10% in Europe Retail price: $100 - $200 ODM Model:  Distribution: Ace Bayou in New Orleans;  Retail stores: Wal-Mart, Target Brands: X Rocker” and “V Rocker”
Multimedia Speakers ODM/OEM business model 20 distributors 100% sold in China, 50% of which under AIV brand Broad product base, 41 products in total Notebook, PC speakers, channel speakers, wireless speaker  kit an and, notably, Digi Panda 24% - gross margins; 16% - net Retail price: $6-$60 Industry Overview: In 2011, it is estimated that there will be 32 million units sold in China, or $780 million; worldwide sales to reach $3.4 billion*  Chinese speaker market is growing at 18+%, vs. the 9.6% globally Market share: < 0.5%  Significant growth opportunity due  to new products * Source – China  Electronic Speaker  Industry  Association and HZ Research
Video Products LED Backlit TV’s  ODM business model Established customer relationships with European  brands: ALDI, Dixons, Qmedia 2 distributors in Germany and Belgium Launched in April, 2010 39% or $10.7 million of total revenue during 3Q10 New product in 2011 Interactive Intelligent Panel – Video Conferencing System Fully equipped high-definition touch screen and on-screen handwriting recognition Anticipate revenue generation during the first quarter of 2011 and yield gross profit margins in the range of 30%
Near-Term Growth Strategy  Electronic Furniture Establish sales channel in China Gain wider distribution in the US and in Europe Multimedia / Digital Speakers Design and develop selling products Digital speaker Sound bar for TVs Video Products Continue to deliver high-margin small-order customized products Start production of Interactive Intelligent Panel for domestic sales Expedite the R&D of new products such as: Electronic menu  Electronic mahjong system
China Opportunity Begin Distributing Electronic Furniture Product Line in China AIVtech invented the electronic gaming furniture market Currently sales are entirely from outside of China Begin China distribution in 2011 through large, name brand electronic retailers Electronic Furniture Industry in China China: 338 million Internet users More than 170,000 Internet cafes Ranks number two with 27% of global video game revenue 2009 Online gaming sales in China were $3.8 billion, an increase of 39.5% YOY China’s online game industry is expected to grow 21% this year, according to Niko Partners.
Income Statement Highlights CONSOLIDATED INCOME STATEMENT  ($ Millions) Three Months Ended  Sep 30, 2010 Nine Months Ended  Sep 30, 2010  2010 2009 2010 2009 Sales, net  $27.5  $16.0  $56.2  $27.8  Cost of sales  (21.5) (11.7) (42.8) (20.3)  Gross profit  6.0  4.3  13.5  7.5 Selling, general and administrative expenses  (0.7) (0.5) (1.9) (1.5)  Income from operations  5.3  3.8  11.6  6.0  Other income/(expenses)  0.0  0.0  0.0  0.0  Profit before income tax  5.3  3.8  11.6  6.0  Income taxes  (0.7) (0.4) (1.5) (0.6) Net income  4.5  3.4  10.1  5.4  Net income per share  $0.22  $0.17  $0.49  $0.27
Strong Revenue Growth 64% CAGR * 2007 and YTD 2010 figures are unaudited +102% ($ millions)
Strong Net Income Growth 107% CAGR +81.6% * 2007 and YTD 2010 figures are unaudited ($ millions)
Balance Sheet Highlights * In December 2010, AIVtech  raised $7.54 million at $3.00 with 10% warrant coverage at $4.00 (5 years). * Make Good Provisions: 2010 EPS of $0.44 and 2011 EPS of $0.60.  CONSOLIDATED BALANCE SHEET  ($ Millions)  Sep 30, 2010 December 31, 2009 Cash and cash equivalents  $3.1* $3.6 Accounts Receivable 10.3 2.0 Other Receivables, net 0.17 0.04 Inventories 3.7 5.1 Total Current Assets 17.2 10.8 Total assets  18.3 11.8 Account Payables and Accrued Expenses 4.3 5.4 Short Term Loan 0.75 - Due to Related Party 4.0 0.029 Current liabilities  10.3 10.1 Total Shareholders’ Equity  8.0 1.7 USE OF PROCEEDS $7.54 Million Equity Financing in December 2010 Working Capital – Video Products
Industry Comparables Ticker Price 2/24/11 Shares  Out. (MM) Market Cap. ($MM) EV ($MM) TTM Revenue ($MM) EV /TTM Revenue P/E P/BV Op. Margin (%) ROA (%) Company Harman International Industries Inc.  NYSE: HAR $46.99  95.27 4,477  4,118  3,480  1.18 14.33 2.56 4.9% 4.03 NIVS IntelliMedia Technology Group Inc.  NYSE: NIV $2.69  47.97 129  175  299  0.59 4.01 1.05 12.0% 12.9 Mad Catz Interactive, Inc.  AMEX: MCZ $1.55  55.72 86  117  177  0.66 9.12 3.97 10.5% 11.85 Emerson Radio Corp.  AMEX: MSN $2.44  27.13 66  53  211  0.25 3.94 1.29 9.5% 15.03 AIVTech International OTCBB: ECOH $2.12  22.8 48  46  67  0.69 3.59 5.89 20.9% 53.4%
Management Team Name Position Background Mr. Jinlin Guo Chairman and CEO Founder, professional engineer, many years of design experience Mr. Xiaoyou Luo Vice Manager Professional advanced engineer, many years of design and project management experience Mr. Wenfeng He COO Former controller at Malata group and of Shenzhen Wei Zhi group Mr. Yilin Shi CFO Many years experience as financial manager and controller
Investment Highlights Pioneer and market leader in electronic furniture China distribution of AIV-brand electronic furniture will drive tremendous growth both in top line and bottom line New products, including Digital Speaker, Sound Bar, Interactive Intelligent Panels, to maintain near-term growth momentum  Strong R&D, combined with capable and aggressive management team, to maintain long-term competitiveness 102% Revenue Growth & 82% Net Income Growth YoY EV/EBITDA is $42.2M/ $14.4M = 2.9 2011 EPS guidance: $0.61
Contact Us AIVtech International Group Co. Teli Liao, VP/Secretary of Board PH: +86 755 2533 3022 [email_address] Investor Relations Contact: HSC Global, LLC Alan Sheinwald, President US +1-914-669-8885 Email: alan.sheinwald@hscglobal.net Corporate Information Investor Contact Auditor Counsel Friedman LLP 1700 Broadway New York, NY 10119 Anslow & Jaclin LLP  1350 Avenue of the Americas, 3rd Floor  New York, NY 10019

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AIVtech powerpoint

  • 1. AIVTECH INTERNATIONAL GROUP CO. (OTC BB: ECOH) March 2011
  • 2. Safe Harbor Statement Safe Harbor Statement for Purposes of the “Safe Harbor” Provisions of the Private Securities Litigation Reform Act of 1995: This presentation contains “forward-looking” statements, which are not historical facts, but are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to analyses and other information based on forecasts of future results and estimates of amounts not yet determinable. These statements also relate to our future prospects and proposed new products, services, developments or business strategies. These forward-looking statements are identified by their use of terms and phrases such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “intend”, “may”, “plan”, “predict”, “project”, “will”, “continue” and other similar terms and phrases, including references to assumptions. Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to changes and to inherent known and unknown risks and uncertainties. We do not intend, and undertake no obligation, to update our forward-looking statements to reflect future events or circumstances.
  • 3. Company Overview Provider of originally designed consumer electronics ~ 80 products in three product divisions High-quality Audio Furniture – Primary supplier of electronic components Multimedia Speakers Video Products Founded in 2004: 323,000 square foot manufacturing facility in Dongguan China, Guangdong Province Strong Brand, AIV (Audio and Interactive Video) Strong financial growth (First 9 months of 2010) Revenue: $56.2 million ▲ 102% YOY Net Income: $9.8 million or $0.49/share ▲ 81.5% YOY
  • 4. Select Financials Fiscal Year End: December 31 st Symbol: (OTC BB: ECOH) Stock Price (3/2/2011): $2.08 Shares Outstanding (12/30/2010): 22.5 million Fully Diluted Shares Outstanding (12/30/2010): 22.8 million Market Cap: $47 million Q3 2010 Revenue: $27.5 million ▲ 72.0 % YOY Q3 2010 Net Income: $4.4 million ▲ 27.8 % YOY Q3 2010 EPS: $0.22 ▲ 29.4 % YOY 2010 Revenue (first 9 mos.): $56.2 million ▲ 102% YOY 2010 Net Income (first 9 mos.): $9.8 million ▲ 81.6% YOY 2010 Make Good EPS: $0.44 2011 Make Good EPS: $0.60 2011 EPS Guidance: $0.61 Auditor Friedman LLP Legal Counsel: Anslow & Jaclin LLP
  • 5. Revenue Breakdown 2010 First Nine Month Product Revenue Audio Furniture 65.4% LED TV 21.1% Multi-Media Speakers 13.5% First 9 Months of 2010 2009 % of Sales 2010 % of Sales YOY Change Gross Profit Margins Audio Furniture $22.2M 80% $36.8M 65.4% ▲ 65.8% 26% Multimedia Speakers $5.6M 20% $7.6M 13.5% ▲ 35.7% 24% Video Products $ - - $11.9M 21.1% - 15% Total $27.8M $56.2M ▲ 103% 21.7%
  • 7. Proprietary Technology 50 People on R&D team with budget 8-9% of employees Plan to quadruple the team within the next 5 years 11 patents, 6 software copyrights, hundreds of certifications Patented Products Digital speaker with audio and video function Multimedia furniture chair with audio Core Technology Includes: Integrating multimedia digital products with furniture Ergonomic design features Key technology and application of a digital family doctor Ergonomic IT130
  • 8. Awards/Certificates ISO9001: 2000 China Compulsory Certification (3C) South Korea electrical and electronic research institute Hong Kong standards and testing product certification European Union CE certification State FCC certification
  • 9. 30,000 Sq. Meter Facility Located in Dongguan, Guangdong Province with 600+ employees Utilization rate with one 12-hour shift: 90%. Capacity can be expanded by: Overtime - up to 80 hours per month overtime Outsource production Build new facility Production cycle Existing products: 12-18 days New products: 15-21 days
  • 10. Sales and Distribution Overview Audio Furniture Ace Bayou is recipient of products through Chinese furniture distributor 90% final sales in US, 10% in Europe ODM under X Rocker and V Rocker names Multimedia Speakers 100% of sales in China 20 distributors 50% under AIV brand / 50% ODM, OEM LED TV’s 100% of final sales in Europe Two distributors: Germany and Belgium (Qmedia, ALDI, Dixons) ODM model 2010 First Nine Month Sales by Distributor Da Kang 31.5% Other 12.5% Anji Chaoya 12.4% Guangdong Guanghong 34% Beijing Huaqi 5.2% Anji Weiyu 4.1%
  • 11. High-Quality Audio Furniture Mainly electronic chairs Currently 12 models; several prototypes in pipeline 4 types of chairs: Gaming chair Music chair IT chair Health chair ODM Model: Primary supplier of value added electronic components
  • 12. Gaming Chair Award winning; PS and Xbox compatible 60% of total market share 90% final sales in US; 10% in Europe Retail price: $100 - $200 ODM Model: Distribution: Ace Bayou in New Orleans; Retail stores: Wal-Mart, Target Brands: X Rocker” and “V Rocker”
  • 13. Multimedia Speakers ODM/OEM business model 20 distributors 100% sold in China, 50% of which under AIV brand Broad product base, 41 products in total Notebook, PC speakers, channel speakers, wireless speaker kit an and, notably, Digi Panda 24% - gross margins; 16% - net Retail price: $6-$60 Industry Overview: In 2011, it is estimated that there will be 32 million units sold in China, or $780 million; worldwide sales to reach $3.4 billion* Chinese speaker market is growing at 18+%, vs. the 9.6% globally Market share: < 0.5% Significant growth opportunity due to new products * Source – China Electronic Speaker Industry Association and HZ Research
  • 14. Video Products LED Backlit TV’s ODM business model Established customer relationships with European brands: ALDI, Dixons, Qmedia 2 distributors in Germany and Belgium Launched in April, 2010 39% or $10.7 million of total revenue during 3Q10 New product in 2011 Interactive Intelligent Panel – Video Conferencing System Fully equipped high-definition touch screen and on-screen handwriting recognition Anticipate revenue generation during the first quarter of 2011 and yield gross profit margins in the range of 30%
  • 15. Near-Term Growth Strategy Electronic Furniture Establish sales channel in China Gain wider distribution in the US and in Europe Multimedia / Digital Speakers Design and develop selling products Digital speaker Sound bar for TVs Video Products Continue to deliver high-margin small-order customized products Start production of Interactive Intelligent Panel for domestic sales Expedite the R&D of new products such as: Electronic menu Electronic mahjong system
  • 16. China Opportunity Begin Distributing Electronic Furniture Product Line in China AIVtech invented the electronic gaming furniture market Currently sales are entirely from outside of China Begin China distribution in 2011 through large, name brand electronic retailers Electronic Furniture Industry in China China: 338 million Internet users More than 170,000 Internet cafes Ranks number two with 27% of global video game revenue 2009 Online gaming sales in China were $3.8 billion, an increase of 39.5% YOY China’s online game industry is expected to grow 21% this year, according to Niko Partners.
  • 17. Income Statement Highlights CONSOLIDATED INCOME STATEMENT ($ Millions) Three Months Ended Sep 30, 2010 Nine Months Ended Sep 30, 2010 2010 2009 2010 2009 Sales, net $27.5 $16.0 $56.2 $27.8 Cost of sales (21.5) (11.7) (42.8) (20.3) Gross profit 6.0 4.3 13.5 7.5 Selling, general and administrative expenses (0.7) (0.5) (1.9) (1.5) Income from operations 5.3 3.8 11.6 6.0 Other income/(expenses) 0.0 0.0 0.0 0.0 Profit before income tax 5.3 3.8 11.6 6.0 Income taxes (0.7) (0.4) (1.5) (0.6) Net income 4.5 3.4 10.1 5.4 Net income per share $0.22 $0.17 $0.49 $0.27
  • 18. Strong Revenue Growth 64% CAGR * 2007 and YTD 2010 figures are unaudited +102% ($ millions)
  • 19. Strong Net Income Growth 107% CAGR +81.6% * 2007 and YTD 2010 figures are unaudited ($ millions)
  • 20. Balance Sheet Highlights * In December 2010, AIVtech raised $7.54 million at $3.00 with 10% warrant coverage at $4.00 (5 years). * Make Good Provisions: 2010 EPS of $0.44 and 2011 EPS of $0.60. CONSOLIDATED BALANCE SHEET ($ Millions) Sep 30, 2010 December 31, 2009 Cash and cash equivalents $3.1* $3.6 Accounts Receivable 10.3 2.0 Other Receivables, net 0.17 0.04 Inventories 3.7 5.1 Total Current Assets 17.2 10.8 Total assets 18.3 11.8 Account Payables and Accrued Expenses 4.3 5.4 Short Term Loan 0.75 - Due to Related Party 4.0 0.029 Current liabilities 10.3 10.1 Total Shareholders’ Equity 8.0 1.7 USE OF PROCEEDS $7.54 Million Equity Financing in December 2010 Working Capital – Video Products
  • 21. Industry Comparables Ticker Price 2/24/11 Shares Out. (MM) Market Cap. ($MM) EV ($MM) TTM Revenue ($MM) EV /TTM Revenue P/E P/BV Op. Margin (%) ROA (%) Company Harman International Industries Inc. NYSE: HAR $46.99 95.27 4,477 4,118 3,480 1.18 14.33 2.56 4.9% 4.03 NIVS IntelliMedia Technology Group Inc. NYSE: NIV $2.69 47.97 129 175 299 0.59 4.01 1.05 12.0% 12.9 Mad Catz Interactive, Inc. AMEX: MCZ $1.55 55.72 86 117 177 0.66 9.12 3.97 10.5% 11.85 Emerson Radio Corp. AMEX: MSN $2.44 27.13 66 53 211 0.25 3.94 1.29 9.5% 15.03 AIVTech International OTCBB: ECOH $2.12 22.8 48 46 67 0.69 3.59 5.89 20.9% 53.4%
  • 22. Management Team Name Position Background Mr. Jinlin Guo Chairman and CEO Founder, professional engineer, many years of design experience Mr. Xiaoyou Luo Vice Manager Professional advanced engineer, many years of design and project management experience Mr. Wenfeng He COO Former controller at Malata group and of Shenzhen Wei Zhi group Mr. Yilin Shi CFO Many years experience as financial manager and controller
  • 23. Investment Highlights Pioneer and market leader in electronic furniture China distribution of AIV-brand electronic furniture will drive tremendous growth both in top line and bottom line New products, including Digital Speaker, Sound Bar, Interactive Intelligent Panels, to maintain near-term growth momentum Strong R&D, combined with capable and aggressive management team, to maintain long-term competitiveness 102% Revenue Growth & 82% Net Income Growth YoY EV/EBITDA is $42.2M/ $14.4M = 2.9 2011 EPS guidance: $0.61
  • 24. Contact Us AIVtech International Group Co. Teli Liao, VP/Secretary of Board PH: +86 755 2533 3022 [email_address] Investor Relations Contact: HSC Global, LLC Alan Sheinwald, President US +1-914-669-8885 Email: alan.sheinwald@hscglobal.net Corporate Information Investor Contact Auditor Counsel Friedman LLP 1700 Broadway New York, NY 10119 Anslow & Jaclin LLP 1350 Avenue of the Americas, 3rd Floor New York, NY 10019