3 Recurring

2nd NAMESA TECHNICAL CONFERENCE 2008 5-6 MAY 2008 DUSIT LAGUNA, PHUKET Maintenance and Recurring

RECURRING REVENUE REGION 1 2 3 4 5 6 7 8 9 10 11 12 13

UAE Saudi Arabia G4Kuwait India Oman Qatar Morocco Philippines Thailand Jordan Singapore Egypt Yemen

10% 6% 1% 13% 8% 7% 10% 17% 22% 12% 14% 23% 22%

14 15 16 17 18 19 20 21 22 23 24 25 26

Pakistan Malaysia Bahrain Lebanon Al Mulla Kuwait Bangladesh Nepal Bhutan Mauritius Cambodia SriLanka Mauritania Syria

28% 0% 4% 0% 29% 4% 11%

CMS NAMESA Region 31-Dec-06 Oct 07 Bahrain Bangladesh Bhutan Egypt India Jordan Kuwait G4 Kuwait Securicor Lebanon Mauritania Mauritius Morocco Nepal Oman Pakistan Philippines Qatar Saudi Arabia Singapore Sri Lanka Syria Thailand UAE Yemen Total

2

Mar 08 2

621

506

476

8 60

10 64

10 64

500 20

566 22 n/a 1436 55

640 22 1496 20

250

267

267

579

650 2 40

650 2 40

65

40

2143

3,620

3,689

Maintenance & Repair

A Post Installation Business

Maintenance & RepairWhat are they? – Services are provided post system handover.  Can be on a single contract but are separate, distinct services  Maintenance- preventative actions, training etc.  May also include small modifications and additions.

 System Repair- correction of system faults.  Provided free during any warranty period

Maintenance & RepairAttractiveness • Provides stable Recurring Revenue • Not unduly price sensitive  Typical GM 45% - 65%

• Provides a regular contribution to the overhead cost base • Ensures a regular contact with the customer • Provides opportunities for additional work

Maintenance & RepairService Combinations  System Repair on an ad-hoc chargeable basis  System Repair with a service contract charged per visit  System Repair with a comprehensive service contract, customer pays for damage, operational errors etc.  As 2 above but with maintenance included  As 3 above but with maintenance

Maintenance & Repair Point to note:• Very important to get a post installation service contract signed at time of order or system handover  Not ideal to re-open negotiations once initial order placed  Provides terms and conditions to cover the warranty period  Good business practice

Maintenance & RepairGrowing the business Steps:• Mandatory inclusion of a service contract with every new quote • Use a dedicated sales resource to sell service to existing customers • Use a dedicated sales resource to sell service to non customers

Typical M&R Marketing Strategy Target:Existing customers with small installations for Preventive / Comprehensive Maintenance sales  Existing customers with large installations for Static Maintenance sales  Third party installations with equivalent makes of products, replace with G4S equipment when need arises

 Third party installations with other range of products, equipment provided by the customer when replacement is needed.

 Include M & R charges and contracts in the proposals when quoting for new projects

Good Work Practices

– – – – –

Standard Template for Agreement Separate team for Maintenance Technicians/Engineers Proper Hand over of the Job from Project Division Monitor MTBF & MTTR for better customer Satisfaction Planning and adherence for regular scheduled Maintenance visits – Availability of Fast moving spares

Recurring Apart from Maintenance other recurring revenue streams: • Adhoc Maintenance • CMS and small alarms • SecureTrak

Recurring First Aim : Recover all direct costs from Recurring Then indirect too All profit from installation will be net profit

Challenge • Do you have specialists sales for : – Maintenance ? – CMS ? – SecureTrak ? • Are you above the 10% recurring revenue threshold ? • Are all new contracts inclusive of maintenance contract ? • Is all recurring income being recorded as such ? • Enhancing CMS and SecureTrak

Thank you