www.apcplc.com

Sales platform built for growth

September 2017

Design, specification and distribution of specialist electronic components, products and systems

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Our product and application focus today

Aerospace | Broadcast | Commercial Real Estate | Counter-IED Data Centres | Defence | Education | Facilities Management

Finance | Healthcare | Manufacturing | Military | Oil and Gas | Retail Space | Systems Integrators | Telecommunications | Transport

Our strategy for growth

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Growth by signing new proven technology partners:

• Three new signings in FY 2017 Q4 already

• Robust pipeline of other target technologies

Increased revenue through our established & growth technologies:

• Re-organised and incentivised sales teams, hunters not order takers

• £16m of orders taken in 2017 (i.e. future orders are greater than billings pointing to growth)

• Growth technologies: compliance driven (eg time synchronisation) or market driven (eg lighting solutions)

Sales growth through bolt on acquisitions

• Targeting established companies with T/O £1M+ that can provide additional revenue and bank of existing customers

Restructure debt with ABN / Other

• £3.3m of debt is costing 10% plus pa

• Restructure to £4m at lower cost improving PBT and freeing funds for investment in growth£

Growth through incentivised sales teams

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Marketing:Market, customer and competitor research. Clearly defined plan of campaigns to align with sales objectives

Specialist business teamsSpecific technical expertise | In-depth industry and

product knowledge | Incentivised sales teams

Account managers

Experiencedteam leader

Product managers

Group Support for Sales and Marketing Execution

Internal sales:Office-based team receive all incoming calls and respond promptly to quotations and order placements

Post sale processing:Order management, compliance with specification and standards. Import, storage and onward logistics

A proven track record of growth in targeted technologies:

Top 15 technology partners in 2017 – consistent growth (16% in FY)

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2010 2011 2012 2013 2014 2015 2016 2017

Growth through established technologies

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Key Hi-Rel Partner Case Study:

• Late in 2006 APC was approached by a leading manufacturer of electronic components for military and aerospace applications.

• The manufacturer’s UK sales were flat and short term outlook was a decline in sales.

• The number of new project engagements had fallen and little feedback was available.

• APC was appointed in 2007 and began a detailed promotional programme to increase sales.

AnnualBookingsValueGrowth

APC doubled the order intake in 3 years and achieved a 4x

increase in 8 years

2017 - A record year for APC Hi-Rel

• Team reinvigorated and incentivised – entering 2018 with double the order book of 2017• Record bookings of £7.1m in the year • Billings up by 31% and bookings by 38% in 2017

The Background:

• APC has been working with a leading German manufacturer of specialist systems for telecoms, broadcast, finance and power sectors for over a decade.

• In 2014 new legislation was introduced within the finance sector that required the use of this technology to meet compliance.

• APC undertook a year-long targeted campaign including events, webinars, white papers, email marketing and a focussed telesales campaign using a specialist technical telesales company.

• Evolving technologies within the broadcast sector have lead to an increase in the requirement for our product, providing our next growth focus.

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Increased revenue through growth technologies

Over a 4 year period total sales increased by 50%, with a 65%

increase between 2016 to 2017. Compliance driven sales to the

finance sector grew by 129% between 2016 to 2017.

2017 - A record year for APC Time

• Team targeted on specific technology with market compliance and digitalisation growth drivers • Bookings of £1.2m in the year • Billings up by 65% and bookings up by 74% in 2017

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APC Time Annual Revenue

Increased revenue through growth technologies

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Refocused Service:

• Our lighting division has refocused their activities on offering turnkey solutions for FM companies and commercial real estate organisations who manage multiple properties across a national spread.

• A year long strategy to achieve preferred supplier status with leading FM companies has resulted in the signing of preferred supplier agreements (PSA) with 3 of the largest global real estate services firms.

• PSAs are in progress with another two market-leading FM companies.

APC lighting has a substantial pipeline at advanced quote

negotiation stage with 12 FM / property management companies

2017 – Building a bespoke lighting solutions business

• Team targeted on specific solution to a specific set of customers • New relationships built with European suppliers

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PSA 1 PSA 2 PSA 3

FY 2017 Billed and Quotes in Progress

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Quoted

Trading Statement - Results to 31 August 2017

• The unaudited full year results to 31 August 2017 are expected to show revenue of £15.6m (2016: £17.9m), gross profit of £5.5m (2016: £6.4m), an operating profit before interest, amortisation, depreciation and exceptional costs of £0.8m (2016: £0.3m) and a profit before tax (“PBT”) in the region of £0.2m.

• This will be the Group’s first PBT since the year ended August 2014.

• These results reflect the commitment of the Board to deliver a profitable business and to concentrate on activities where the Group can create value and upon which APC can grow.

• Net debt at the end of the year is expected to be £3.1m (2016: £3.2m) of which £2.5m (2016: £2.7m) related to amounts owed under the Group’s £6m invoice finance facility with ABN Commercial Finance.

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Our pedigree in specialist electronics

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1982

APC is incorporated as a distributor of high reliability electronic components.

1996

APC lists on London Stock Exchange.

UK wide offices:

Present day

UK wide coverage:Rochester, Kent (HQ)Central LondonNettleham, Lincolnshire

• Regional field sales

70 Employees42 customer facing positionsProduct Managers, Technical Sales, Internal Sales, Sales Administration

2006 to 2016

APC plc acquires:• Hero Electronics (2006)• Contech Electronics (2008)• Novacom Microwaves (2008)• Minimise Limited (2013)

TurnoverFY 2017 revenue c. £16M

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