Company Confidential Psion Teklogix Employee Communications Meeting May 2006

Company Confidential

Psion Teklogix

Employee Communications Meeting

May 2006


Agenda

2006 Goals

Focus

Innovation Focus

Employee Survey Results

EMEA

Asia

Americas


Our Ambition

Successful progress towards $0.5 billion revenues, growing market share

#3 in world overall but often #1 or #2 in country/market/product segment

Need better profits to achieve product roadmap and competitiveness

Which will secure our position in SCL and expand in GMM

Protect our differentiated business model - customer focus, direct sales in SCL, customization of product


Current Status Of Our Business

Good growth but reducing profitability over past 9 months

Gross margins weak - ie the difference between our selling price and our cost of making products

Operating expenses – spending is on budget but we need tight controls to prevent further declines in profitability (hence the Headcount freeze and the request to limit travel and other discretionary spend)


Revenue 100.0%

Cost of Sales 57.0%

Gross Margin 43.0%

Field Selling Costs 23.5%

R & D 7.5%

Admin 8.4%

Profit 3.6%

Cost of Sales includes: • Cost of materials for products• Manufacturing costs• Customer Service costs• Professional Services costs• Warranty costs• Freight & Duty

Gross Margin


Actions To Improve Profits

Short term: cost management

Short term: improve business processes - planning and inventory management

Short term: combine engineering and operations to create one team focused on speeding up product lifecycles and measurably improving new product quality

Medium term: define new manufacturing strategy to seek lower manufacturing costs

Medium term: exploit our higher volumes to get lower product costs

Medium term: use our existing capabilities to customize products


RoHS Update █ : EMEA █ : Americas/ Asia

2005 Q1 Q2 Q3 Q4

7535/30

7535/30 G2

WA MX

WA PRO

WA PRO G2

8525/30

8525/30 G2

8560/70

8560/70 G2

9500

9500 G2

9150

9160

9160 G2

NB

Non RoHS RoHS

NB

NB


Patents – Innovation at Work!

◄ Our Patent Portfolio is Growing ►

New Filings RFID Device Management Portable Image Reader Insulated Smart Battery Pack

New US Grants A Row Decoding Scheme for Double Sampling in 3T Pixel

Arrays Host Interface For Imaging Arrays Imaging Device



Extra Mile Awards - Americas

Maja Gracanin

Charlie Smith

Bob Stahl

Barry Watkinson


Contribution Awards

Martin ChristensenHe did an outstanding pioneering job in implementing TekSpeech for the following customers in Nordic: FAKTA, Schou Company, L'Oreal, Årstiderne and KESKO. KESKO was so satisfied with the pilot TekSpeech-SAP implemented in January that they placed an order for an additional 260 speech terminals (€800,000+) in March.

Subodh Kumar DasHe worked with the sales teams to help close new deals, specially JCB and Videocon. His efforts in a successful 9160 demo at Tata Motors were commendable – talking to support in Canada during the nights and working with the demo at the customer site during the days.


Contribution Awards

Nick QuinnFor his efforts in the establishment, development and success of the EMEA Help Desk. He moved to Aix en Provence in September 05 to help build this team and to serve as a link between the HD and Engineering in Mississauga. He has done an excellent job meeting his immediate responsibilities as a Support Analyst and has added value by training and developing the new analysts serving at the EMEA HD.

Elvira ZakFor doing an outstanding job maintaining the year end finance and audit process and showing great calmness while facing it single-handedly.


Bravo Team Awards

Benelux Technical Services Team – Benelux – For the commitment and effort they put into their job. Benelux had a good Q1 2006. The resources were limited for the job that had to be done but despite the workload the entire technical team kept their enthusiasm and accomplished a great job.

Competitive Teardown Team – U.S.A. –For their effort in the Yellow Roadway deal. This team did a comparison of our product against a competitive product. This analysis was then presented to the prospect and won us a 200 terminal pilot! This has now launched additional analysis for other competitive products with other deals.

*** Please see the “Source” for list of recipients ***


Bravo Team Awards

Production RoHS Readiness Team – Mississauga – For volunteering to help do the move and set up for RoHS. They worked together to ensure a smooth transition to the shop floor. They manually moved, set up and washed down benches and because of their efforts production was up and ready to go on Monday morning.

TekRF Initiative Team – Mississauga - For their efforts in implementing TekRF - configuration and installation. Due to their hard work we have been able to implement Cycle Counting, Replenishing, Transferring, Receiving and In-bounding with little or no interruption to the daily business in our Ops group.

*** Please see the “Source” for list of recipients ***


Long Term Service Award


20 Years of Service

Steve Riley - Technical Consultant(United Kingdom)


15 Years of Service

Don Adams - Sr. Channel Sales Manager(U.S.A.)

Peter Cormack - Production Tester

(Canada)

Jonas Mendiola - Technical Consultant, Ports(U.S.A.)

Shelley Swant - Receptionist/Office Services Group Leader(Canada)

Carla Thompson - Sr. Customer Support Coordinator(U.S.A.)

talentmapwww.talentmap.com

Psion Teklogix - Talentmap survey: Jan 11 - Feb 2, 2006

Employee Survey Results Presentation

Psion Teklogix

May 10, 2006



Agenda

Introduction Survey Overview Employee Profile Job Satisfaction Detailed Analysis Areas to Focus Employee Engagement



Talentmap’s Confidentiality

No data or reports will be provided unless there are at least SIX (6)

respondents.



Executive Summary: Most Important Dimensions

Basic

Social

Actualization

Growth

Performance

Feedback

External:

Customer Focus

Information &

Communication

Compensation

Involvement

Engagement

Personal & Professional

Growth

Internal:

Quality Imp.

Work

Resources

Teamwork

Senior LeadershipManagement Organizational Vision

Basic

Social

Achievement

Actualization

Performance

Feedback

External:

Customer Focus

Information &

Communication

Compensation

Involvement

Engagement

Personal & Professional

Growth

Internal:

Quality Imp.

Work

Resources

Teamwork

Senior LeadershipManagement Organizational Vision

Psion Teklogix most important dimensions circled



22

Survey Overview



Survey Overview

Your survey period: Jan. 11th – Feb. 2nd 2006 Benchmark analysis does not include your company

Response Rate

89%85%

79%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Psion Teklogix 2004

Psion Teklogix 2006

Benchmark

(% F

requ

ency

)

n = 968n = 847



24

Employee Profile



Gender Profile Gender nMale 684Female 269

72%

28%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Male Female

(% F

requ

ency

)

Psion Teklogix 2004 73% 27%



Age Profile Age nUnder 25 4525-34 28835-44 39445-54 18555+ 39

Psion Teklogix 2004 4% 33% 42% 16% 5%

5%

30%

41%

19%

4%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Under 25 25-34 35-44 45-54 55+

(% F

requ

ency

)



Level of Education Profile Level of education nSome / high school graduate 135Some college / university 170Technical / college diploma 208University degree 324Graduate degree 124

14%18%

22%

34%

13%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Some / highschool graduate

Some college /university

Technical /college diploma

Universitydegree

Graduatedegree

(% F

requ

ency

)Psion Teklogix 2004

11% 17% 24% 36% 12%



Length of Service Profile

Psion Teklogix 2004 17% 21% 23% 29% 10%

Length of service nLess than one year 181One - three years 224Three - five years 148Five - ten years 276Ten years (or greater) 132

19%23%

15%

29%

14%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Less than oneyear

One - threeyears

Three - fiveyears

Five - ten years Ten years (orgreater)

(% F

requ

ency

)



Level of Responsibility Profile

73%

22%

5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Individual contributor Manager Senior executive

(% F

requ

ency


74% 21% 5%

Level of responsibility nIndividual contributor 703Manager 207Senior executive 49



Functional Group Profile(Response rate by total survey respondents)

32%26%

21%

7% 5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

EMEA Americas Engineering Operations Finance &Admin.

(% F

requ

ency


23% 12% 17% 9% 8%

Functional group nEMEA 308Americas 250Engineering 205Operations 63Finance & Admin. 47



Functional Group Profile(Response rate by total survey respondents)

4% 2% 1% 1% 1%0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Asia Pacific Marketing HR Tech. Ed.& Contracts

Executives PLC

(% F

requ

ency


n/a n/a n/a n/a n/a

Functional group nAsia Pacific 34Marketing 18HR Tech. Ed. & Contracts 14Executives 13PLC 8



Functional Group Profile(Response rate by department)

100% 100% 100% 100% 100%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Finance &Admin.

HR Tech. Ed. &Contracts

Marketing Executives Engineering

(% F

requ

ency


97% n/a n/a n/a 95%



Functional Group Profile(Response rate by department)

Americas PLC Asia Pacific EMEA Operations

91%

73% 72% 71%

61%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

(% F

requ

ency


93% n/a n/a 67% 80%



34

Job Satisfaction



Overall Job Satisfaction Score

Psion Teklogix 2004

69

% unfavourable % favourable% neutral

% Favourable = Very satisfied + Satisfied

% Neutral = Neutral

% Unfavourable = Very dissatisfied + Dissatisfied

12

15

20

12

68

73

0% 20% 40% 60% 80% 100%

Psion Teklogix

Benchmark

(% Frequency)



Overall Psion Teklogix Satisfaction Score% unfavourable % favourable% neutral

Benchmark

73

68

Psion Teklogix 2004

69 12

13

20

21

68

66

0% 20% 40% 60% 80% 100%

Job satisfaction

Psion Teklogixsatisfaction

(% Frequency)

n/a



Overall Job Satisfaction Score By Length of Service

% unfavourable % favourable% neutralBenchmark

82

73

64

67

72

Psion Teklogix 2004

78

71

70

63

68

4

15

11

13

17

14

17

22

24

17

81

67

66

62

65

0% 20% 40% 60% 80% 100%

Less than one year

One - three years

Three - five years

Five - ten years

Ten years (orgreater)

(% Frequency)



Overall Job Satisfaction Score By Functional Group


10

13

8

15

9

14

33

22

18

25

19

16

23

17

25

21

6

17

26

50

71

71

69

68

66

64

61

60

56

25

0% 20% 40% 60% 80% 100%

EMEA

Americas

Executives

Finance & Admin.

Engineering

HR Tech. Ed. & Contracts

Marketing

Operations

Asia Pacific

PLC

(% Frequency)

Psion Teklogix

2004

71

76

n/a

80

60

80

n/a

63

71

71



39

Detailed Analysis



Key Areas of Focus 2004 - 2006

MOST IMPORTANT AREAS:

Survey Topic 2006

Basic Needs Personal and Professional Growth

(2004 – Personal Growth & Work Environment)

Social Needs Teamwork

Achievement Needs Quality Improvement

Growth Needs* Immediate Management

(2004 – Vision & Purpose)

*Represents a fundamental component of employee engagement



Satisfaction ScoresBy Main Survey Attributes


7377667062596059635261555022

211821

1318

1513151617

1212

2523

2419

2621

2223201915

1520

53565860616163636465

6874

68

0% 20% 40% 60% 80% 100%

Info. and comm.Pers. and prof. growth

Performance feedbackCompensation

Organizational visionTeamwork

Customer focusSenior leadership

Quality improvementImmediate management

Work resourcesInvolvement

Overall satisfaction

(% Frequency)

Psion Teklogix

200469n/a6663n/an/an/an/a68626556n/a

Bolded attributes were selected by respondents as most important



42

Areas to Focus

Personal and Professional Growth

Teamwork

Quality Improvement

Immediate Management



Personal and Professional Growth

Agreement

Imp

orta

nce

high

low

highlow

Career aspirations

Enough training

Opportunity to learn

Opportunity to do what I do best

Major Opportunities Major Strengths

Minor Opportunities Minor Strengths



Personal and Professional GrowthAgreement Scores


Benchmark

55

61

61

52

45

Psion Teklogix 2004

56

n/a

53

41

40

21

13

19

31

19

23

20

19

29

27

56

67

63

41

54

0% 20% 40% 60% 80% 100%

Overall personal &professional growth

Opportunity to dowhat I do best

Opportunities to learn

Enough training

Career aspirations

(% Frequency)

Strength

Opportunity



How could personal and professional growth opportunities be improved?

1231 defined points

692 respondents commented on this section

100%

24%19% 18% 18%

10% 8%3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Improvedtraining

Personaldev.

plans

Moreadv.opps.

Moreopps.

for growth

More timeand money

Satisfied Other

(% F

requ

ency

)




Improved training

*More 9 - 5 training - very difficult to attend after hours training after putting in a full day at Psion Teklogix

*Better training would be extremely helpful, we all learn differently

Personal development

plans

*No personal development plans

*It is also important to offer better vision of career path and promotion for experienced employees

How could personal and professional growth opportunities be improved?



Teamwork

Agreement

Imp

orta

nce

highlow



Strong feeling of team spirit

Share information

Co-operation is encouraged

Part of a team

high

low



TeamworkAgreement Scores


Benchmark

59

64

67

57

48

Psion Teklogix 2004

n/a

70

n/a

n/a

n/a

18

16

15

20

21

21

15

20

23

24

61

69

65

57

55

0% 20% 40% 60% 80% 100%

Overall teamwork

Part of a team

Co-operation isencouraged

Share information

Strong feeling ofteam spirit

(% Frequency)

Strength

Opportunity



How could teamwork be improved?1198 defined points


27%

19% 16% 16%10% 8%

4%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Improvecomm.

Demo.of teamwork

from leadership

More teambuilding

More collab. Satisfied More social / informal

Other

(% F

requ

ency

)




Improve communication

*Better communication between my manager on what projects are lined up for me

*Open communication to various project teams

Demonstration of teamwork

from leadership

*Psion Teklogix should keep asking and involving employees in decisions, etc.

*Manager should request employee opinions more frequently

How could teamwork be improved?



Quality Improvement

Agreement

Imp

orta

nce

high

low

highlow


Learning is an important obj.

Adopt new ways to work

Committed to high quality work

Failure is viewed as an opp.




Quality Improvement Agreement Scores


Benchmark

62

48

82

55

64

Psion Teklogix 2004

n/a

n/a

n/a

n/a

n/a

15

19

8

21

12

20

21

14

30

16

64

59

77

49

72

0% 20% 40% 60% 80% 100%

Overall qualityimprovement

Failure is viewed asan opp.

Committed to highquality work

Adopt new ways towork

Learning is animportant obj.

(% Frequency)

Strength

Opportunity



How could overall quality of output be improved?

997 defined points


24%21% 20% 20%

10%5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

More training

Clear direction

Better

comm.

More

commitment

Satisfied Other

(% F

requ

ency

)




More training *Better training of products

*More training in development rather than pigeon hole people into certain tasks and refuse to let them explore more responsibility

Clear direction *More commitment and clear direction from our senior (vp) managers

*While I appreciate each individual adopting their own way of working within their departments, there still needs to be specific guidelines on how we need to work

How could overall quality of output be improved?



Immediate Management

Agreement

Imp

orta

nce

high

low

low


high


Cares about me

Gives me constructive feedback

Acts consistently

Sets clear and measurable goals



Immediate Management Agreement Scores


Benchmark

70

65

69

66

79

Psion Teklogix 2004

63

n/a

n/a

56

n/a

16

19

18

17

12

19

21

17

22

15

65

60

65

60

73

0% 20% 40% 60% 80% 100%

Overall immediatemanagement

Sets clear andmeasurable goals

Acts consistently

Gives me constructivefeedback

Cares about me

(% Frequency)

Strength

Opportunity



How could your immediate manager improve?1060 defined points


25%19% 17%

14% 13%8%

3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Satisfied Better

comm.Clear

directionFair

treatment

More

supportive

More

approach.

Other

(% F

requ

ency

)




Satisfied *My manager is great! I am pleased with having him as a manager

*I’m quite happy with the relationship and performance of my manager

Better communication

*Clearer instructions, we are supposed to read his mind

*Communicate more in multi ways

How could your immediate manager improve?



59

Employee Engagement



EngagementAgreement Scores


71

82

73

75

67

71

68

64

Psion Teklogix2004n/a

71

73

n/a

*86

n/a

n/a

56

*Based on yes/no response scale

34

9

10

7

6

8

2

11

17

22

17

19

16

12

13

16

49

69

73

74

79

80

85

73

0% 20% 40% 60% 80% 100%

Manager has talked about my progress

This org. inspires me

Job provides me with sense of accomplish.

Recommend this org.

Optimistic about future

Work is challenging

Proud to work for this org.

Overall engagement

(% Frequency)



EngagementAgreement Scores by Functional Groups


11

13

13

7

11

11

10

12

11

2

48

23

19

23

17

15

16

14

14

14

40

64

69

69

72

74

74

74

75

84

0% 20% 40% 60% 80% 100%

PLC

HR Tech Ed & Contracts

Engineering

Asia Pacific

Finance & Admin.

EMEA

Operations

Marketing

Americas

Executives

(% Frequency)



Effectiveness of Immediate ManagerAgreement Scores


Psion Teklogix2004

63 16

14

19

16

65

70

0% 20% 40% 60% 80% 100%

Psion Teklogix

Benchmark

(% Frequency)



Effectiveness of Immediate ManagerAgreement Scores by Functional Groups


-

10

12

6

13

20

16

16

17

26

20

10

16

24

18

16

21

23

22

14

80

80

72

70

69

64

63

61

61

60

0% 20% 40% 60% 80% 100%

Executives

Marketing

Finance & Admin.

PLC

Americas

EMEA

HR Tech Ed & Contracts

Engineering

Operations

Asia Pacific

(% Frequency)

Psion Teklogix

2004

n/a

n/a

54

76

73

65

54

59

56

65



Are you looking for or thinking of accepting a job with another employer?

Benchmark Psion Teklogix

20%

80%

27%

73%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Yes No

(% F

requ

ency

)



Are you looking for or thinking of accepting a job with another employer?Yes by Functional Group

28%25%

19% 18% 18%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Engineering PLC Operations EMEA Asia Pacific

(% F

requ

ency

)



Are you looking for or thinking of accepting a job with another employer? Yes by Functional Group

18% 17% 15%8% 7%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Americas Marketing Finance &

Admin.

Executives HR Tech.Ed. &

Contracts

(% F

requ

ency

)



Do you think your opinions count, based on what you have seen?

70%

30%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Yes No

(% F

requ

ency

)



If not, how can Psion Teklogix better demonstrate that your opinions do count?

386 defined points


(% F

requ

ency

)

28% 26% 24%

12%

5% 3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

More

accountability

More follow

through

More

comm.

Departmental

action plan

Other Satisfied




More accountability

*We need more accountability and ownership in this organization

*I would like to see evidence of improved communication and accountability

More follow through

*More follow through from manager on a departmental level

*Follow through on major recommendations / opinions

If not, how can Psion Teklogix better demonstrate that your opinions do count?



“How likely are you to accept a position with another employer in the next 12 months?” is cross-tabbed with “Overall level of satisfaction with your current job”

to determine levels of commitment.

How likely are you to accept a position with another employer in the next 12 months?

Please rate your overall

level of satisfaction

with your current job.

Employee Commitment

Very unlikely Unlikely Neither Likely Very likely

Very dissatisfied

Dissatisfied

Neutral

Satisfied

Very satisfied

0.5 0.2 0.4 0.4 1.3

0.6 0.7 3.6 3.1 1.6

1.2 3.4 10.1 3.9 1.2

12.3 17.6 16.9 4.1 0.6

10.5 4.3 1.0 0.2 0.2



Employee Commitment

Psion Teklogix 2006 Commitment Index = 45%

Your 2004 Commitment Index = 34%

Commitment Index = Very committed + Committed

Very at risk6%

At risk19%

Satisfied but would leave

23%Dissatisfied

but would stay7%

Committed

35%

Very committed10%

Very at risk8%

At risk16%


35%

Dissatisfied but would stay

7%

Committed28%

Very committed

6%

2004 Benchmark Commitment Index = 39%



Employee Commitment

Benchmark Commitment Index = 44%

Commitment Index = Very Committed + Committed

Psion Teklogix 2006 Commitment Index = 45%

Satisfied but

Very at risk7% At risk

12%

would leaveDissatisfied but would

stay6%

14%

Committed

30%


12%

would leave

30%

Dissatisfied but would

stay6%

Very committed

14%

30%

Very at risk6%

At risk19%


23%Dissatisfied

but would stay7%

10%

Very at risk6%

At risk19%


23%Dissatisfied

but would stay7%

Committed

35%

Very committed10%



If you could deliver one message to your executive team, what would it be?

1144 defined points


17% 16% 15% 15% 14% 13%9%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Bettercomm.

Clearconsistent

vision

Improvelead.

Betterstrategies

Companydirection

Right direction

Other

(% F

requ

ency

)

Kudos 19%Better strategies 16%More communication 13%Compensation 11%Improve leadership 10%Employee recognition / respect 10%Training and development 5%

2006 comments self-coded,2004 comments coded by Talentmap

2004 comments




Better communication

*Better communication of plans down the ranks

*Improve communication internally, make sure vital info. does not get stranded somewhere along the chain

Clear consistent

vision

*Clear and consistent vision and better strategies

*Great job but provide a clear long term plan

If you could deliver one message to your executive team, what would it be?



What do you see as the single biggest obstacle to revenue and profit growth at Psion Teklogix?

444 defined points


Staffing issues

32%

14% 13%7% 6% 6%

39%

12%21%

7% 5% 5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Products Strategies Competition Comm. Management

(% F

requ

ency

)

Psion Teklogix 04 Psion Teklogix 06




Products *Insufficient product development investment

*Lack of specialized or highly configurable products / services to pursue a wider variety of opportunities

Staffing issues *Trying to achieve too much with too few people

*Talented people leaving the company as a result of competitive salaries elsewhere

What do you see as the single biggest obstacle to revenue and profit growth at Psion Teklogix?



77

Questions?


EMEAEMEA

Jacky Lecuivre, Senior Vice PresidentJacky Lecuivre, Senior Vice PresidentMay 2006May 2006


EMEA performance in Q1 06EMEA performance in Q1 06

Q1 06 Q1 06

Actual vs BudgetActual vs BudgetQ1 06 vs Q1 05Q1 06 vs Q1 05

RevenueRevenue +5%+5% +21%+21%

DOIDOI +1%+1% -13%-13%

With these numbers, EMEA has currently delivered With these numbers, EMEA has currently delivered

• 59 % of the Worldwide Q1 revenue59 % of the Worldwide Q1 revenue

• 67 % of the Worldwide Q1 DOI 67 % of the Worldwide Q1 DOI of our Company.of our Company.

To compare apple to apple, all of the ratios are taking into account the revenue and DOI we have delivered in Euros.


EMEA revenue in April 06 EMEA revenue in April 06

April 06 April 06

Actual vs BudgetActual vs Budget

April 06 vs April 06 vs

April 05April 05

RevenueRevenue -5%-5% -11%-11%

To compare apple to apple, the ratios are taking into account the revenue we have delivered in Euros.

Unfortunately and regarding what we currently have in our Unfortunately and regarding what we currently have in our

backlog, we should have been significantly over budget and over backlog, we should have been significantly over budget and over

last year if many orders excepted to revenue April had not slipped last year if many orders excepted to revenue April had not slipped

to May (2.5 M€!). to May (2.5 M€!).


Our best growth contributors Our best growth contributors by Country – to Q1 2006by Country – to Q1 2006

CountryCountry % of Budget% of Budget % of last Year% of last Year

Benelux 114% 148%

France 118% 113%

MNEA 104% 399%

Nordic 106% 146%

South Africa 263% 300%

Switzerland 141% 153%


EMEA Revenue and DOI breakdowns per country

RevenueRevenue

RSA 8%Dubai 2

%

UK 12%

MEAN 4%Ita

ly 6%

Swiss 1%

Benelux 8%

Spain 4%

France 36%

Nordic 6%

Germany 12%

;

RSA 15%

UK 9%

Benelux 9%Swiss 1%Italy 3%

MEAN 5%

Spain 2%

France 40%

Nordic 6%

Germany 10%

DOIDOI


We are still the bests in Ports:We are still the bests in Ports:

SAPOSAPO: US$ 1 000K: 8525, 7530 Narrow Band

YTD Revenue generation: our major SCL winsSCL wins

Mediterranean Shipping CompanyMediterranean Shipping Company: Valencia in Spain: US$ 520K: 8525, 7530, 9160 Antwerp in Belgium: US$ 270K: same configuration

Against LXE

PSAPSA : Antwerp in Belgium: US$ 280K: 8255 & 7530

Port of Dakar & DPA Nigeria Port of Dakar & DPA Nigeria : : US$ 340K: 7030, 7530 Narrow Band

Kenyan PortsKenyan Ports : US$ 360K: 8525, 7535 Narrow Band

ICTSI MadagascarICTSI Madagascar: US$ 100K: 7530 Narrow Band


DecathlonDecathlon: US$ 430K: more than 700x7535 deployed in their DC’s in France, China, Russia, Poland, Italy & Spain. Next target: thousands of WAP to be rolled out in their stores.

PSAPSA: US$ 360K: 8525 against LXE.

DachserDachser: US$ 250K: 7535 & 9150

YPO (Yorkshire Purchasing OrganizationYPO (Yorkshire Purchasing Organization): US$ 360K: 7535 against LXE

HeinzHeinz: US$ 360K: 7535, 8525 + MIS

London Metropolitan PoliceLondon Metropolitan Police: US$ 300K: 7535 + MIS

SonySony: US$ 180K: 7535 against Symbol

BorealisBorealis: US$ 300K: 8530 + RFID

Egyptian MilitaryEgyptian Military: US$ 180K: 7530 Narrow Band

AdidasAdidas: US$ 420K: 7535: Fruitful collaboration between Benelux and China

YTD Revenue generation: our major SCL winsSCL wins


ONFONF: US$ 420K: WAP Mx, data collection in French forests.

Cargo LineCargo Line: US$ 520K: WAPS + GSM, Transportation application.

Interspe / HarmannInterspe / Harmann: US$ 450K: WAPS + GSM, Logistics & Transport.

German Police:German Police: US$ 300K: WAP C, Ticketing application.

Comptoir LaitierComptoir Laitier: US$ 200K: WAP C, Van sales.

Standard BankStandard Bank: US$ 200K: WAP + RFID, Unique solution to banks.

Ufone PakistanUfone Pakistan: US$ 350K: WAP. Field service

YTD Revenue generation: our major GMM winsGMM wins


SNCFSNCF: We have already delivered more than 3 500 WAPS with Accelio configuration: more than US$5000K revenue.

SNCF MarCom department is massively advertising around the project. They have issued some posters and designed some Accelio WAP cut outs which are placed in their train stations and the star is clearly our magic WORKABOUT PRO !!!

YTD Revenue generation: our major GMM winsGMM wins


Christian SalvesenChristian Salvesen: US$ 300K: T2X, TekSpeech, 3PL for Metro.

PanaviPanavi: US$ 550K: T2X, TekSpeech, happy SCL customer.

ToyotaToyota: US$ 400K: Talkman T5, roll out of our successful 2005 pilot.

Kesko:Kesko: US$ 1000K: 260 T2X, TekSpeech connected to SAP.

L’oréalL’oréal: US$ 150K: 20 T2X + Scanners, Van sales.

WürthWürth: US$ 150K: T2X, TekSpeech, Pilot for their picking control center, very big potential

Norauto: Norauto: US$ 200K: T2X connected to Manhattan direct.

YTD Revenue generation: our major Voice Picking winsVoice Picking wins


Rest of the year revenue generation: the “special”projects we have in our funnel

DHL EMA (Emerging Markets)DHL EMA (Emerging Markets): After losing the projects for DHL USA & Europe, we have tried to understand how to recover on this major account.

During my last trip in Dublin, I have got a flash… In the last few months, I have drunk some good Guiness and… we have won DHL EMA for + 3 000 WAP GSM/GPRS and Imager for + US$ 4000K+ US$ 4000K.

+ 1000 units will have to be delivered before end of June.


Rest of the year revenue generation: the “special”projects we have in our funnel

SAPO (Saudi Arabia Post Office)SAPO (Saudi Arabia Post Office): We have finalized the contract for the delivery of 1.4 Million RFID UHF Tags and 500 RFID WAP.

The amount of the contract is US$ 2700KUS$ 2700K and we are expecting the first P.O. to arrive in the next few weeks.

Application: A RFID tag will be placed on each and every mail box in the Kingdom of Saudi Arabia and the Saudi postmen will have a WAP to read the relevant information.

This contract only covers 1 of the 8 regions concerned by the global project.


FedexFedex: US$ 420K: 7535.

Ingram MicroIngram Micro: US$ 850K: 7535 & Talkman T5. Symbol replacement

VolkswagenVolkswagen: US$ 600K: 8530

Argos:Argos: US$ 430K: 7535 roll out.

Intellident for HondaIntellident for Honda: US$ 500K: 7535 UHF RFID

Coop Ceramiche Imola : Coop Ceramiche Imola : US$ 360K: 7535. Strong competition with Symbol.

Salalah Port: Salalah Port: US$ 700K: 8525 + VoIP.

Rest of the year revenue generation: the big SCL projects we have in our funnelthe big SCL projects we have in our funnel


ISTAISTA: + US$ 2000K: WAP C. Strong competition with Unitech.

TISTIS: + US$ 1200K: WAPS & WAPC - 2 big projects to replace WAMX.

TobaccolandTobaccoland: US$ 500K: WAPC GSM.

Royal Mail:Royal Mail: + US$ 2500K: WAP. Imminent competitive decision.

TescoTesco: US$ 600K: WAP. Competing against Symbol, Intermec and HHP.

Swiss Post : Swiss Post : + US$ 15000K: WAP.Smart card reader and printer for delivery. We compete with everybody…

Correos: Correos: US$ 1300K: WAPS + WiFi + Imager.

KamstrupKamstrup: US$ 1500K. 1000 WAP. Special end cap.

Budapest ElectricityBudapest Electricity: US$ 350K. WAP. Meter reading.

Polish ForestsPolish Forests: Up to US$ 3500K. WAP. Struggling with internal politics.

SNCF: Another US$ 1200K to invoice on Accelio in 06.

Rest of the year revenue generation: the big GMM projects we have in our funnelthe big GMM projects we have in our funnel


DIORDIOR: US$ 240K: T2X, TekSpeech.

Kühne & NagelKühne & Nagel: US$ 420K: Talkman T5, TekSpeech.

EismannEismann: US$ 600K: Talkman T5, TekSpeech.

Direct Wines:Direct Wines: US$ 600K: 7535, 8525, Talkman T5, TekSpeech.

Capper / SPARCapper / SPAR: US$ 300K: Talkman T5, TekSpeech.

Manor : Manor : US$ 300K: T2X, TekSpeech

Brendolan: Brendolan: US$ 200K: T2X, TekSpeech.

Scania PartsScania Parts: US$ 180K. T2X, TekSpeech

TDGTDG: US$ 200K. Talkman T5

DFDS TransportDFDS Transport: US$ 600K. WAP Voice.

Rest of the year revenue generation: the big Voice Picking projects we have in our the big Voice Picking projects we have in our

funnelfunnel


EMEA Mobile Solutions groupEMEA Mobile Solutions group: Thanks to its creativity and talent, Rob Vandervecht’s group has developed outstanding solutions around our WAP and “small” Companies are courting us more and more frequently like:

Really pushing us for active collaboration on RFID and secure ID applications.

They are financing the development of our secure ID WAP portfolio (e-passports & any secure ID documents). Integration of RFID, biometrics, Imager, MRZ readers will give us a unique product for this promising new market.

Euro – USD Fx: Euro – USD Fx: The Fed Bank and European Central Bank have understood that our EMEA numbers were badly affected by the Q1 Euro / USD Fx and have decided to come back to a much better 1.27 Fx rate.

Some other good news for the rest of 2006

1 = 1.271 = 1.27


My recommendation for the next few months …

Let’s be as PUNCHY as possible!!!

SEXY will be for the 2nd Half…


Asia


Asia Pacific

Japan39%

China30%

PacRim8%

Australia13%

South Korea2%

India8%

2006 – Q1 Revenues by Countries


Asia Pacific

2006 Performance by Countries

Country vs. Budget vs. Last Year

Pacific Rim 131% 58%Australia 82% 96%Korea 50% -India 148% 155%Japan 100% 1000%China 51% 65%

Asia 73% 120%

DOI 0% -


Asia Pacific – 2006 Q1 Performance

• Asia Performance in Q1 was unsatisfactory at breakeven hampered by product delays and deliveries of low margin products (NetBooks to Japan)

• Restructured our Asia Operations by flattening Management.

• Eliminated management positions in Singapore.• Continued our decentralizing of Asia Operations by moving

people in the geographies they cover.• Finalized our presence in Australia/New Zealand by moving

Vani Saradhi to Sydney.• Created a Solution Engineering Group in Singapore• Expanded our RFID penetration in Korea


Asia Pacific – 2006 Q1 Activity

• 600 WAP with HF RFID sold to Omron in Japan with another 1000 on order for other customers.

• More than 300 WAP shipped to China.• Bidding a 5,000 WAP retail customer in Australia• Completed a 2,500 WAP bid for an Asia Police Force with the first 30

pilot units ordered• Completing a 500+ WAP order for a transportation company in

Australia• Bidding a 1,000 WAP order in New Zealand with a courier Service• First Evergreen Port shipped in Taiwan• Closed orders for Renault, GM Daewoo, ID Logistics, GE Fanuc,

Flextronics, all in cooperation with US and EMEA.• Strengthened our #1 position in the Automotive Vertical in India with

additional orders from TATA motors• First TekConsole installation in China at SuNing, the largest white good

manufacturer in China


Asia Pacific – 2006 Q2 Goals

• Bring working capital to target levels by aggressively

collecting cash owing• Limit spending to sales generation• Postpone any capital expenditures• Analyze margin on every opportunities• Recover Q1 missing DOI• Postpone all Hiring

Americas

• Americas Progress

• Our Secret Weapon

• 2006-2008 Way Forward

General Motors (Service and Parts Distribution)

• GM Service & Parts Operation. It is for six sites this year, with three more likely over• the next two years. This is the Mr. Goodwrench division of GM. This is where all• aftermarket parts are sold to dealerships across North America.

• Deal/Size: a potential 2.25 million this year. We are selling 7535s and 8530s. In addition, we have been hired by EDS to perform installation and project management services.

• The first order, that is already been received was for 3 sites totally 980K. This will be delivered this quarter. The next three sites will be done during the 3rd quarter and will total another 980K. If GM has enough money at the end of the year, they will add a seventh site this year, bringing the total deal to 2.25M this year. The remaining sites when completed over the next two to three years will bring the total deal to roughly 4 million, this is on top of the 3.5M the deal has been worth for the last 5 years.

• Solution: WMS system that GM has been rolling out to their Parts Distribution Centers across North America. GM S&PO has gone to a template concept in which all PDCs look exactly alike. Our solution beat out Symbol during the initial competition. We won because of support and product functionality and our willingness to enhance our products to meet GM's needs.

7535

8530

Goodyear

7535 RFID Reader

Goodyear manufactures automobile and truck tires. Goodyear is using

the Psion Teklogix 7535 with RD7950 UHF RFID Reader along with a

software application from CTI, Akron, OH, to track and manage its tires

at all three NASCAR top series in 2006, including the Nextel Cup

Series, Busch Series and Craftsman Truck Series.

Solutions/Products: (20) 7535 & RD7950

Deal Size: $110K

• With 43 cars at each Nextel Cup race and each car using about 10 sets of tires per race, the task of tracking all of the tires can be challenging and time consuming. Goodyear's goal is to optimize how it tracks the nearly 2,000 tires from manufacturing through distribution to the teams, and then to the final disposition of the tires after each race.

• The decision to fully deploy the Psion Teklogix RFID solution at all 2006 races follows Goodyear's successful testing session at the Homestead-Miami Speedway during the 2005 season finale of the Craftsman Truck Series, when Goodyear tires equipped with RFID were raced for the first time.

Pason Systems Inc. / Aurora Barcode

• Pason Systems Inc. is an industrial technology company providing design, manufacturing and rental of specialized drilling instrumentation systems for use on land-based drilling rigs. Pason's products and Services include data acquisition, well site reporting software, remote communications and Internet Information management tools.

• Problem: Pason Systems Inc. employs 255 field technicians which are contracted to various oil companies to service equipment at their remote land-based drilling rigs. These technicians were using rugged laptops to record the movement of equipment between the drilling rig, the truck, the warehouse, the service centre, etc. They needed a rugged, more portable device that could be used to scan the linear barcode labels on the equipment, and sync up to their laptop for upload to their hosted web service – where oil companies log into for status updates.

• Solution/ Products: 255 WORKABOUT PRO S devices with linear imagers will be installed into Powered Vehicle Cradles on 255 service trucks in Canada. The field service technician will scan the barcodes on any equipment he removes or installs from the land-based drilling rig. At any point the equipment is put onto a truck, or delivered to a warehouse, service location or courier, this is captured on the WORKABOUT PRO .

• Deal size: 255 WORKABOUT PRO S with vehicle docking stations – field technicians. 20 WORKABOUT PRO S for warehouse. Total net: $361,495 US.

WORKABOUT PRO S

MBM

• MBM is the largest privately held Restaurant Food Supplier in the country. There• customers range between Chick-fila, Red Lobster, Oliver Garden and Lone Star. They• Revenues are between 6 to 7 billion dollars and have distribution center located through• the US. Currently Teklogix core products are installed within 30 of there facilities and• have been a Teklogix customer for the past 12 years.

• Problem: Food Distribution mandates low margin and high volume. It is there objective to increase delivery accuracy while reducing cost. The cost of shipping errors and credits is costing MBM $644,000 for all their DCs. Internal Picking Auditors cost MBM $150,000 per location. The goal is to increase picking accuracy to 99.80; with a hopeful side benefit of productivity.

• • We tried to use 7030 terminals and ring scanners, but the they became bulky and

cumbersome. The equipment did not get the results we wanted. Do to the conservative nature of MBM they did not want to try anything to "bleeding edge", but after Chris Wappler spoke to them concerning the pros of speech and Vocollect, the owner was convinced.

• • Deal/Size: The entire deal encompasses 30 to 33 DCs and each DC is about $80,000;

a total of 2.4 million dollars. But more importantly savings for MBM close to $5,000,000.

http://www.olivegarden.com/

http://www.chickfila.com/Home.asp

DataStream

• Data Stream is an Enterprise Asset Management provider who offers 2 products. MP2 is designed for Small-Medium sized companies, and 7i is designed for large enterprise customers.Our partner, Blue Dot Solutions, uses their application development software (mNOW Framework) to create mobile versions of these two Data Stream products, that Data Stream then resells to it’s customers.

• Problem:

• When the Data Stream reps quoted Symbol or Intermec devices, they were forced to expose the device part number. Most customers would do an internet search and find the device cheaper, calling into question the rep’s credibility. As a result, the reps pulled back and quit quoting the devices. As a result, the revenue fell and the support costs skyrocketed.

• Solution/ Products:

• Private Branding was of great interest and the WORKABOUT PRO gave Blue Dot & Data Stream several advantages:

• The modular design gave their customers options for upgrades in the future

• Our ability to quickly implement RFID modules, such as Identec, has given them a competitive advantage

• The DS-1100 (WAP) is now the only “certified” device that they sell, and gives customers piece of mind when installing it, that they will have a solution that will work right out of the box. Please see the link attached.

• Deal size:

• We expect this to generate 400+ terminals annually. DS-1100WORKABOUT PRO

http://www.datastream.net/

UPS

• UPS is an International leader in express shipping with 2,000 airplanes and the 9th largest

• Airline in the world. UPS’s Louisville, KY is their main air hub and satellite site in Rockford, IL

• has had Psion Teklogix for over 10 years.

• Problem/Solution: Main goal was to keep existing software and capabilities but provide a technology refresh for the RF equipment & backbone. UPS decided to upgrade with Psion Teklogix as we proved during evaluation that the upgrade with the new products would be seamless to their users.

• Products: 560 -7530’s and 8530’s at the two sites. • Pilot at Rockford, IL has been successful and main hub will

receive over 300 -7530’s later this month.

• Deal size: Total deal will be $2M this year

7530

8530

Americas: 2006 to 2008

200

170

2008

Americas Revenues

91,350

110,348

83,41578,518

89,000

80,554

40

60

80

100

120

140

2000 2001 2002 2003 2004 2005 2006Projected

US

$ M

illi

on

s

2007

Americas Bookings by Region – 2006

March '06 YTD Non-Service Bookings vs. Prior Year

2006 2005 Over/(Under)

East 4,915 3,691 1,224 33%

Central 8,259 3,341 4,919 147%

West 5,141 4,096 1,044 25%

USA Commercial 18,315 11,128 7,187 65%

Canada 2,798 1,610 1,188 74%

Latin America 2,400 1,309 1,091 83%

Sub-Total 23,512 14,047 9,466 67%

Gov't 317 1,343 (1,025) (76%)

Total 23,830 15,389 8,441 55%

Americas Backlog by Region – March 2006

March '06 Backlog

Region Hardware Site Survey & Installation

Software & Prof Service

TOTAL

Canada 775 77 56 908Latin America 1,368 0 3 1,371Government 17 87 25 129USA-Central 5,076 215 103 5,394USA-Eastern 1,014 149 151 1,314USA-Western 606 235 310 1,152Total Region 8,856 764 648 10,268

Gross Margin% and Discount by Deal Size

CANUSA GM% by Order Size

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

< $10k $10k to $30k $30k to $100k $100k to $500k > $500k

GM

%

Direct VAR Co-Marketer

2004 & 2005 “Building Block” Transformation

Professionalism

Mission / Paradigm Shift

Service Differentiation

“Climbing the Mountain”

General Mobility

Market Launch

Regional Expansion

Professional Services

Teamwork and Collaboration

Americas and Sales Leadership Regeneration

Strategic Alliances

Performance Management towards a Performance Based Culture

Sol Engineering

Organizational Alignment

Channel

Inside Sales

Government

Market Focus

Marketing

2006-2008 Model

80,554 83,415

91,350

78,518

89,000

110,348

2006 - 2008 Transformation Continues

80,554 83,415

91,350

78,518

89,000110,348

2008 2000 2001 2002 2003 2004 2005 2006Projected

2007

4 Quadrant sales model

Gross margin project

RoHS

Beta Program

Speech / RFID

Competitive Bridge Chart = Total Cost of Ownership

• WAP-M WAP-C G2 MC3000 Notes

Hardware Costs

HW Durability

Years of Use

Cost of Flexibility

Productivity Gain

Network Mgmt.

Walkie-Talkie

Service

Problem Resolution

Total

$883

+ $ 0

+ $ 0

+ $ 0

+ $ 0

+ $ 25

+ $150

+ $243

+ $ 0

$1301

$1213

+ $ 0

+ $ 0

+ $ 0

+ $ 0

+ $ 25

+ $150

+ $320

+ $ 0

$1708

$600

+ $ 75

+ $375

+ $200

+ $120

+ $110

+ $350

+ $324

+ $ 50

$2204

Symbol price estimated based on product class.

Client License

3% more spares

PV $600 5yr. 10% rate

PTX Connect vs. WT

Usability features

3 year maintenance

PTX support

Future application

Components

Workabout Pro MC3000

The Workbout Pro has fewer parts and less chance of part failure

Display

The Workabout has larger fonts and a crisper display for much better readability

MC3000Workabout Pro

Key Contacts

• Scott Green – Competitive Tear down– [email protected]

• Doug Yust – Competitive Analysis– [email protected]

• Mike McGuriman – Speech Deals– [email protected]

• Peter Zanetti & Todd Matthews – RFID Deals– [email protected]– [email protected]

mailto:[email protected]



Employee Commitment – Secret Weapon

Americas Sales 2004 Commitment Index =

43%

Commitment Index = Very Committed + Committed

Psion Teklogix 2006 Commitment Index =

45%

Americas 2006

Commitment Index = 50%Very at risk

5%At risk18%


20%Dissatisfied

but would stay7%

Committed

37%

Very committed13%


14%


33%

Dissatisfied but would stay

6%

Committed

33%

Very committed10%

2004 Benchmark Commitment Index = 39%

. .. ..

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.. .

.......

.

. .

.......... ............

... ..

...................

.......

...

...

... .

..

.

.

....

...........

....

..

.............

.... .............

......

.. ........ .. . ... .......... ..

... .. ...

.

..

PSION TEKLOGIXPORT INSTALLATIONS

245 Port installs and counting

Warehouse

Ports

DoD

Manufacturing

Transportation

Cold Chain

Airport & Rail

FieldService/Data

Collection

Utilities/ Municipal

Asset Mgmt

Animal Tracking

Americas Market Focus ’04 – ‘08

2006 - 2008 Americas Way Forward

MI

IL IN

GA

Arizona

CA

UtahNevada

Oregon Idaho

Washington Montana

Wyoming

Nebraska

Colorado Kansas

Texas

Oklahoma

S. Dakota

N. DakotaMN

Iowa

Kentucky

AR

MO.

LA

ALMS

WI

WV

SCNew

Mexico

FL

Maine

NC

Virginia

Alberta Sask.British

Columbia Newfoundland

NB

Troy Ware

Devin Drambarean

Jason Lum

Errol Greene

IL

Ben Sabilano

Hawaii

North American Sales

Andrew Wright

Alaska

RSM Sales Map (K) 200510-21-05

Al Danielski

VTNH

MARI

MD

Tom Schwendt

Jim Higgins

Ron Stein

Central Sales Area

Eastern Sales Area

John Streppone, RVP

Glenn Lundgren, Director of Sales

Western Sales Area

Philippe Beaulieu, RVP Mark Oetken, RSM Ports/AirportsMatt Schwuchow, Mobile Sales

Stephanie Wagg, SAP Sales

Dan Zirkle

Heath Gaffney, Mobile SalesMike McGuriman, SAP Sales

Micheal Ghandy Francis Joannette

Mark Lamonde

OH

Canadian Sales Area

Bertrand Martelle, Country ManagerGreg Evans, Channel Sales

Linda Dutkowski, Channel ISR

Manitoba

Ontario Quebec

Nova Scotia

PA

New York

Randy CampbellNJ

Puerto Rico

Government Sales

Susan King, RVP Brian Adamson – Gov’t PartnersAlex Deli – Army and Air Force

Jim Ward – DeCA/Federal AgenciesStephanie Graham – PM

Darryl Ferguson

Steve Williams

Mexico

Alfonso EscamillaNorthern Mexico

(including Ports in Central America and

Caribbean)

Angel Estrada, MgrSouthern Mexico

Central America &Caribbean

( excluding Ports)

CT

TN

2001 – 2005 Geographic Model 2006 – 2008 Sales/Service Model

Transactional

Strategic

Existing Customers

New Business

ExistingCustomers

NewCustomers

TargetCustomers

KeyAccounts

1

2

3

4

High

Low

Trusted Advisor

Component Supplier

Enterprise Critical

Documents

Company Confidential Psion Teklogix Employee Communications Meeting May 2006