Investor Presentation

1
Investor Presentation

• Craig Hallum Roadshow
• May/June 2006

2
Forward-looking Statements in this Presentation

• Include various risks and uncertainties
• Actual results may differ materially from those
  in the forward-looking statements
• Investors are directed to the Company's filings
  with the Securities and Exchange Commission
• For example Form 10K, 10Q, etc.
• Includes a more complete description of the risks
  and uncertainties relating to forward looking
  statements made by the Company
• Also includes a description of other aspects of
  the Company's business

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FINANCIAL PERFORMANCE
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Income Statement Q1 2006 vs Q4 2005
Proforma
Proforma
Q1 2006 Q4 2005
Total revenue 112.0 128.9 Gross
margin 16.7 14.9 15.5 12.0 Operating
expenses 24.9 22.2 24.7 19.1 Operating
(loss)/income (8.2) (7.3) (9.2) (7.1) Non-operat
ing expense (7.0) (6.3) (0.4) (0.3) Income
before tax (15.2) (13.6) (9.6) (7.4) Net
income (15.3) (13.6) (8.9) (6.9) EPS
(0.39) (0.22)
Q1 2006 and Q4 2005 results exclude nonrecurring
charges/(benefits) of 1.1M and (1.0)M,
respectively
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Balance Sheet 3/31/06 vs 12/31/05
3/31/06 12/31/05
Cash Marketable Securities 78.2
80.1 Accounts Receivable 69.2 70.9 Inventories
49.9 66.4 PPE 8.7 7.2 Other Assets
32.2 39.2 Total Assets 238.2
263.8 Accounts Payable 66.3 74.7 Accrued
Liabilities 28.9 30.9 Other LT Liabilities
3.0 3.0 Equity 140.0 155.2 Total Liability /
Equity 238.2 263.8
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2005 10-K and Q1 10-Q Filing Update

• Nasdaq granted extension for filing10-K and 10-Q
  until July 7 and July 17, respectively
• Believe we will be able to meet deadlines
• Audit committee investigations now substantially
  complete
• Import/export findings with OFAC and BIS for
  review
• China and revenue recognition reports being
  drafted
• KPMG currently reviewing work of investigators
• Findings
• Import/export situation results in a handful of
  reported possible violations, significantly less
  than originally anticipated
• No major findings at this point in China or
  revenue recognition investigations

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Restructuring Plan Delivering Improving Financial
Results

• Core projection business focus
• Alternatives for wireless initiative and The
  University Network expected to be complete in
  late Q2/early Q3
• Reduced quarterly operating expenses
• Headcount down 15 worldwide
• Lower infrastructure costs
• Control of discretionary spending
• Improved gross margins
• Expect to achieve targeted range of 16 to 18 in
  Q2
• Supply chain efficiencies
• New products shipping now resulting in lower
  product costs (volume shipments a little later
  than originally planned but now ramping)

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Major Restructuring Initiatives

• Focus on largest and most profitable
  international geographies
• UK, France, Germany, Nordics, Australia, China,
  India
• Focus on largest, most profitable and fastest
  growing US channels
• Retail, PC Distribution, direct fulfilled
• Driving supply chain efficiency to reduce product
  costs
• Leveraging new contract manufacturing
  relationships
• Changing the game regarding key business terms
  with partners
• Improving inventory velocity and touches between
  contract manufacturers and end user customers
• Driving end user awareness and preference to pull
  product through retail, our web store, and other
  channels where customers want to buy

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UNIQUE STREGTHS
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Industry Leading Products
Commercial
Consumer
Home Cinema
SP777
Installation / Integration
8xx Family
Home Theater
IP74 and IN76
Meeting Room
LP 600 and 640
Home Entertainment
IN72
Value / Mobile
IN24 and IN26
LP 120
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Consistent Award Winning Products
InFocus ScreenPlay 5700 Best Buy and Test
Winner for cinematic dexterity and fine
detail response. What Projector? UK, August

• Global industry awards recognize our excellence
  in product design and innovation

IN72, IN74, IN76 CES Innovations Award Winners,
January
InFocus ScreenPlay 4805 Group Test Winner
described as The Swiss army knife of
projectors. WHAT HI FI? Sound and Vision UK,
August
IN72 CEA Technology is a Girls Best Friend
Winner, January
IN72 PC Magazines Last Gadget Standing Finalist,
January
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And the award goes to.
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Strong Channel Position

• 1 market share in the business and consumer
  retail projector market
• 1 market share in PC Distribution
• 1 recognized brand among projector buyers

Source NPT Intellect, TFCInfo
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Low Cost Supply Chain

• ODM Partners Foxconn, Funai, Delta.
• Joint Venture SMT, a JV between InFocus and TCL
  (China)
• Supplier to parent companies and OEM vendor to
  third parties
• 50 of profits and royalty stream to InFocus
• Use lowest cost resources on mainstream product
• Invest InFocus RD on breakthrough innovations

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ATTRACTIVE MARKET DYNAMICS
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Our Market Is Growing
DTC Q1 2006 Forecast
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Key Industry Growth Trends

• Growth in Consumer (Home Theater) and Educational
  markets
• Home Theater expected to grow 65 annually
  through 2008 (per IDC)
• Total market is 1/3rd education that is less than
  30 penetrated (PMA,SRI)
• Growth in retail channel
• 2004 thru 2007 CAGR for the retail channel is 55
  (IDC)
• Growth in value categories at 799 to 1,099 ASP
  sweet spot

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Major Growth Opportunities

• Less than 4 of mobile professionals carry a
  projector when they travel.
• 80 of small businesses dont use projectors
• Only 5 of conference rooms are projector
  enabled.
• There is only 1 projector for every 3 to 4
  classrooms (NA).
• Over 13 million big screen displays sold to
  consumers in 2005.
• Over 20 million gaming consoles sold in USA in
  2005

Source DTC, IDC, iSuppli, Jupiter Research, PMA,
QED
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Market Growth Drivers Over the Next 12 Months

• Lower ASPs
• Increased awareness
• CE retailer adoption, validation of projection
  category
• New content / devices
• HD gaming consoles, HD broadcast content, HD DVD,
  iPod type devices
• New technologies driving device costs down

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OUR FUTURE
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InFocus Focused

• Positioned for growth
• Consumer insights driven, marketing company
• Bring to market award winning, breakthrough
  products
• Drive demand with consumer focused marketing

• Positioned for profits
• 80/20 geographic / channel distribution plan
• World-class operations manufacturing and
  logistics
• Lean SGA cost base
• Positioned for continued leadership

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New Products in 1H 2006

• Introduced new home and business projector models
  all new design language based on customer
  research
• Now its about usage, usability and style
  beyond feeds and speeds

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Brand Health - Why its so important.
Consumer Purchasing Cycle
Awareness
Knowledge
Desire
Satisfaction
Purchase
Metrics
Total Awareness Aided Un-Aided
Brand equities Emotional (Personality) Rational
(Benefits)
Consideration Persuasion Recommendation
Satisfaction Loyalty Advocacy
Sales / Revenue
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Brand Personality Traits
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1H Brand Campaign Print Creative

• Target Audience Young Indulgent Male
• Publication Golf DigestSporting News

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In Summary

• We have a strong competitive position
• An industry and market share leader
• Breadth and depth of product portfolio
• The market opportunity for our products is
  robust
• Improving financial results
• Restructuring substantially complete-lower costs
• Supply chain efficiencies increasing gross
  margins
• New products shipping positioning us for revenue
  growth as we enter 2H 2006.
• Strong balance sheet

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THANK YOU