Investor Conference Presentation

1CoAdna Confidential

Investor Conference

Presentation

CoAdna Holdings, Inc.

March 23, 2012


DisclaimerTHESE MATERIALS HAVE BEEN PREPARED BY COADNA HOLDINGS, INC. (“THE COMPANY”) SOLELY FOR USE AT THIS PRESENTATION TO RESEARCH ANALYSTS AND

PROPSECTIVE INVESTORS. THE INFORMATION PROVIDED AT THIS PRESENTATION IS BEING FURNSIHED TO YOU SOLELY FOR YOUR INFORMATION AND MAY NOT BE

REPRODUCED OR REDISTRIBUTED TO ANY OTHER PERSON, IN WHOLE OR IN PART. BY ATTENDING THIS PRESENTATION, YOU ARE AGREEING THAT YOU HAVE READ AND

AGREED TO COMPLY WITH THE CONTENTS OF THIS DISCLAIMER.

THIS PRESENTATION CONTAINS FORWARD-LOOKING STATEMENTS. SUCH FORWARD-LOOKING STATEMENTS ARE BASED ON A NUMBER OF ASSUMPTIONS ABOUT THE

OPERATIONS OF THE COMPANY AND OTHER FACTORS, MANY OF WHICH MAY BE BEYOND THE COMPANY’S CONTROL. BY THEIR NATURE, FORWARD-LOOKING

STATEMENTS INVOLVE RISKS AND UNCERTAINTIES BECAUSE THEY RELATE TO EVENTS AND DEPEND ON CIRCUMSTANCES THAT MAY OR MAY NOT OCCUR IN THE

FUTURE. ACCORDINGLY, THE COMPANY’S ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THESE EXPRESSED OR IMPLIED FORWARD-LOOKING STATEMENTS. IN

ADDITION, EVEN IF THE COMPANY’S FINANCIAL POSITION, RESULTS OF OPERATIONS AND CASH FLOWS AND THE DEVELOPMENT OF THE OPTICAL NETWORKING

INDUSTRY ARE CONSISTENT WITH THE FORWARD-LOOKING STATEMENTS CONTAINED IN THIS PRESENTATION, THOSE RESULTS OR DEVELOPMENT MAY NOT BE

INDICTIVE OF RESULTS OR DEVELOPMENTS IN FUTURE PERIODS. IN SOME CASES, YOU CAN IDENTIFY THOSE FORWARD-LOOKING STATEMENTS BY WORDS SUCH AS

“MAY”, “WILL”, “EXPECTS”, “ANTICIPATES”, “AIMS”, ESTIMATES”, BELIEVES”, “INTENDS”, “PLANS”, “IS LIKELY TO” OR SIMILAR WORDS. THE COMPANY DOES NOT

UNDERTAKE ANY OBLIGATION TO UPDATE OR REVISE ANY FORWARD-LOOKING STATEMENTS, WHETHER AS A RESULT OF NEW INFORAMTION, FUTURE EVENTS OR

OTHERWISE.

PROSPECTIVE INVESTORS SHOULD BE AWARE THAT INVESTMENT IN THE COMPANY’S SECURITIES INVOLVES SIGINFICANT RISKS. THE INFORMATION CONTAINED IN

THIS PRESENTATION HAS BEEN COMPILED AS OF THE DATE OF THIS PRESENTATION, AND WILL NOT BE UPDATED TO REFLECT MATERIAL DEVELOPMENT

WHICH MAY OCCUR AFTER THE DATE OF THIS PRESENTATION, AND IS SUBJECT TO CHANGE WITHOUT NOTICE. THE SLIDES FORMING PART OF THIS PRESENTATION

HAVE BEEN PREPARED FOR THE PURPOSE OF PROVIDING BACKGROUND INFORMATION ABOUT THE COMPANY. THIS PRESENTATION CONTAINS, AMONG OTHER

THINGS, INFORMATION AND STATISTICS RELATING TO THE OPTICAL NETWORKING INDUSTRY. THE COMPANY HAS DERVIED SUCH INFORMATON AND DATA FROM

UNOFFICIAL SOURCES. THE COMPANY CANNOT GUARANTEE THAT SUCH INFORMTION IS ACCURATE OR COMPLETE. YOU SHOULD NOT PLACE UNDUE RELIANCE ON

STATEMENTS IN THIS PRESENTATION REGARDING THE OPTICAL NETWORKING INDUSTRY. A DESCRIPTION OF EVENTS OR CIRCUMSTANCES WHICH COULD HAVE A

MATERIAL ADVERSE EFFECT ON THE COMPANY’S BUSINESS, FINANCIAL SITUATION OR RESULTS OF OPERATIONS, OR ITS ABILITY TO FULFILL ITS OBJECTIVES, WILL BE

DESCRIBED IN THE “RISK FACTORS” SECTION OF THE PROSPECTIUS TO BE PUBLISHED IN RELATION TO THE OFFERING. NO REPRESENTATION OR WARRANTY, EXPRESS

OR IMPLIED, IS MADE AS TO, AND NO RELIANCE SHOULD BE PLACED ON, THE FAIRNESS, ACCURACY, COMPLETENESS OR CORRECTNESS OF ANY INFORMATION OR

OPINION CONTAINED HEREIN. IT IS NOT THE INTENTION TO PROVIDE, AND YOU MAY NOT RELY ON INFORMATON FURNISHED TO YOU AT THIS PRESENTATION AS

PROVIDING A COMPLETE OR COMPREHENSIVE ANALYSIS OF THE COMPANY’S FINANCIAL OR TRADING POSITION OR PROSPECTUS.


Content

• Financial Review

• Company Status/Future Prospect/New

Products

• Q&A


2011 vs. 2010

*2010 excluded preferred shares** With preferred shares and stock options

(in US$'000s) 2011% of NetRevenue

2010% of NetRevenue

Net Revenue 44,536$ 100% 41,234$ 100.0%

Cost of Good Sold 22,910$ 50% 19,474$ 47.0%

Gross Margin 21,625$ 50% 21,761$ 53.0%

Operating Expense 12,317$ 27% 9,869$ 24.0%

Operating Income 9,308$ 23% 11,892$ 29.0%

Non-Operating Items 678$ 1% 317$ 1.0%

Net Income Before Tax 9,986$ 24% 12,209$ 30.0%

Income Tax ( 83 )$ 1% 5,793$ 14.0%

Net Income 10,068$ 22% 6,416$ 16.0%

EPS - Basic* 0.26$ 0.57$

EPS - Diluted** 0.25$ 0.21$


2011 Q4 Income Statement (QoQ)

2011/Q3 Stock Option Expense: US$ 550,5322011/Q4 Stock Option Expense: US$ (-373,299)

(in US$'000s) 2011 Q4% of

Revenue2011 Q3

% ofRevenue

Net Revenue 5,151$ 100% 11,131$ 100.0%

Cost of Good Sold 3,282$ 64% 5,825$ 52.3%

Gross Margin 1,869$ 36% 5,307$ 47.7%


Operating Income 119$ 2% 1,960$ 17.6%

Non-Operating Items ( 281 )$ -5% 130$ 1.2%

Net Income Before Tax ( 161 )$ -3% 2,090$ 18.8%

Income Tax ( 451 )$ -9% ( 195 )$ -1.8%

Net Income 289$ 6% 2,285$ 20.5%

EPS - Basic 0.01$ 0.06$

EPS - Diluted 0.01$ 0.06$


2011 Q4 Income Statement (YoY)

(in US$'000s) 2011 Q4% of

Revenue2010 Q4

% ofRevenue

Net Revenue 5,151$ 100% 13,913$ 100.0%

Cost of Good Sold 3,282$ 64% 6,321$ 45.4%

Gross Margin 1,869$ 36% 7,592$ 54.6%


Operating Income 119$ 2% 4,093$ 29.4%

Non-Operating Items ( 281 )$ -5% 251$ 1.8%

Net Income Before Tax ( 161 )$ -3% 4,344$ 31.2%

Income Tax ( 451 )$ -9% 2,647$ 19.0%

Net Income 289$ 6% 1,697$ 12.2%

EPS - Basic 0.01$ 0.15$

EPS - Diluted 0.01$ 0.06$


Balance Sheet (2011/12/31)

Debt to Asset 8%

ROA 21%

ROE 26%

(in US$'000s) 2011/12/31 2011/9/30Current Asset 51,974$ 53,978$

Cash 33,580$ 32,319$

A/R 5,360$ 8,273$

Inventory 9,409$ 10,160$

Other Current Asset 3,625$ 3,226$

Non-Current Asset 6,194$ 6,232$

Intangible Asset 160$ 320$

Other Asset 258$ 635$

Total Asset 58,586$ 61,165$

Current Liability 3,062$ 6,040$

Other Liability 1,679$ 1,318$

Total Liability 4,741$ 7,358$

Owner's Equity 53,845$ 53,807$

Shares Outstanding 42,674 42,526


Industry Update and Future Trend2011

• Overall Operators’ CAPEX increased year on year in 2011 at an

average of 9%

• Global optical components quarterly revenue peaked in

1Q/2011 from the bottom in 1Q/2009

• Global economy started to slow down in second half of 2011

and revenue # dropped

• CoAdna revenue was affected by the slow down in global

economy, primarily in N. America and Europe and saw the

revenue bottomed in 4Q/2011


Operator CAPEX

Source: ICCSZ

• CAPEX for most tier-one global operators increased in 2011 at

average growth rate of 9.1%.

China Mobile China TelecomChina Unicom

Global Operator CAPEX

10CoAdna ConfidentialCoAdna Confidential

Global Optical Component Quarterly Revenue Trend

• Quarterly revenue peaked in 1Q/2011 from the bottom of 1Q/2009

• Revenue trend went down in Q4’11 due to slowdown in global

economy

Global Optical Component Quarterly Revenue Trend

Source: ICCSZ


2011 WSS and ROADM Market Share

Source: Infonetics Research March 2012

• The WSS component market amounted to US$312Million in CY11, 5% lower than CY10 US$329 Million


Industry Update and Future Trend

2012 and Beyond

• Governments recognize the data traffic booming is inevitable

and plan to invest on the infrastructure

• Internet communication and cloud service are the new life

style

• Searching for efficient and cost effective way to expand the

bandwidth and increase the speed

• Telecommunication infrastructure: FTTH => Data traffic =>

Bottleneck in central office => Upgrade infrastructure

• Balance among: CAPEX, REVENUE, OPERATING COST, PROFIT

• Government/Policy endorsement/support

• Industrial cycle vs. bandwidth demand


Optical Telecom Infrastructure Countries around the world plan to increase the broadband coverage and FTTH penetration

Continent Country Optical Telecommunication Infrastructure Plans

Oceania New Zealand Construction of NZ$ 300 million rural broadband network in NZ

Australia Construction of the US$ 38 billion national high-speed broadband network

America

United States Obama stated US$ 7.2 billion broadband subsidies and loans scheme

Brazil Start a national broadband plan, investing $ 7.23 billion within five years, expanding broadband

network coverage

Uruguay Antel, State-owned fixed-line operators, will invest 800 million dollar to expand broadband

network in 2011-2014

Europe

United Kingdom BT investment of 2.5 billion pounds have optical coverage reached 2/3 by 2015

French $ 2.8 billion national loan for broadband projects

Italy Three operators investment US $ 3.22 billion to provide high speed network to one million

users in 5 year

Germany Deutsche Telekom invests 10 billion euros to set up fiber-optic access network in 3 years

Country Optical Telecommunication Infrastructure Plans

China 160 billion RMB investment on optical communication investments in Twelve-Five projects,

India Government special funds, $ 3.5 billion, to provide internet service to half million villages in the

next 2 years

Indonesia $ 9.2 billion broadband budget

Japan Government intends spin off NTT optical fiber business group to improve the FTTH coverage

Taiwan 4 year 40 billion NTD of Taipei City Government to invest on optical communication network

infrastructure


Telecom Investment Cycles

• A financial crisis triggered the global recession and stimulus packages

implemented in China, Europe and the U.S. moderated the decline

• A new, moderate investment cycle starts in 2011 according to Infonetics latest

report on 3/16/2012 with CAGR of 19% for WSS ROADM in next 5 years


WSS of ROADM

• CY10% Market switch to higher port count which is higher ASP



Infonetics Forecast

WSS Will Grow at CAGR 19% from 2011-2016


• Demand for WSS product will continue healthy growth

• ASP will also continue to drop during this period


CoAdna Status and Strategy• Anticipate price competition from other WSS suppliers

• Expect to maintain moderate growth in market share at

existing customers

• Revenue growth comes primarily from North America,

European customers and new products

• Inventory correction expects to complete in coming months

and demand resumes gradually

• New products announced at OFC in March with good

customer acceptance

• Continually focus on product line expansion and new

customer development, in addition to products cost

reductions.


DCEB/DGE

WSS 100G 1xN/Nx1

WSS 50G 1xN/Nx1

One Stop Shop for WSS and ROADM Products

Optical Module Product Lines

OEM

Customers

LightFlowTM

Core Technologies

LC Chips

LC Wafer

HPC WSS 50G

TMX 1xN/Nx1

BXC

ODM ServicesLine card Platforms

ASCI - I ASCI - II

LC Chips

LC Wafer

Flex BandSeries

Twin Series


Features of Next-Gen ROADM

& CoAdna’s Solutions

CoAdna’s solutions Features of next-gen ROADM

New products

New technologies Route&Select

WXC

Colorless

Add/Drop

Colorless Directionless

Add/drop

Colorless Directionless

Contentionless Add/Drop

Flexible bandwidthFlexible

BWDualPackage

HPC WSS(1X20 ~1x23) √√√√ √√√√ √√√√ √√√√ √√√√ √√√√ √√√√

TMX (1x16+) √√√√ √√√√Enables CDC on B & S WXC √√√√ √√√√ √√√√ √√√√

Multicast Switch BXC ( 8x16)

NA √√√√ NA NA NA √√√√ √√√√

980nm Variable pump splitter

NA NA NA NA NA √√√√ √√√√


Thank You!

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