LANDAUER, INC. Investor Presentation May 2012 Until superseded,
this presentation will be available at the Company website
www.landauer.com - in the Investors section.www.landauer.com Slide
2 This presentation may contain forward-looking statements,
including statements about the outlook and prospects for Company
and industry growth, as well as statements about the Companys
future financial and operating performance. Some of the information
shared here constitutes forward-looking statements that are based
on assumptions and involve certain risks and uncertainties. These
include the following, without limitation: assumptions, risks and
uncertainties associated with the company's development and
introduction of new technologies in general; introduction and
customer acceptance of the InLight technology; the adaptability of
optically stimulated luminescence (OSL) technology to new platforms
and formats, such as Luxel+; the costs associated with the
company's research and business development efforts; the usefulness
of older technologies; the anticipated results of operations of the
company and its subsidiaries or ventures; valuation of the
company's long-lived assets or business units relative to future
cash flows; changes in pricing of products and services; changes in
postal and delivery practices; the company's business plans;
anticipated revenue and cost growth; the risks associated with
conducting business internationally; other anticipated financial
events; the effects of changing economic and competitive
conditions; foreign exchange rates; government regulations;
accreditation requirements; and pending accounting pronouncements.
These assumptions may not materialize to the extent assumed, and
risks and uncertainties may cause actual results to be different
from what is anticipated today. These risks and uncertainties also
may result in changes to the company's business plans and
prospects, and could create the need from time to time to write
down the value of assets or otherwise cause the company to incur
unanticipated expenses. You can find more information by reviewing
the "Significant Risk Factors" section in the company's Annual
Report on Form 10-K for the year ended September 30, 2011, and
other reports filed by the company from time to time with the
Securities and Exchange Commission. 2 Safe Harbor Statement Slide 3
Landauer at a Glance 1954 Founded Glenwood, IL Headquarters 550
Employees 78,000+ Annual Customers Served 1.7 million Annual
Individuals Served 94%+ Customer Retention Rates $120.5M FY2011
Revenue (FYE September) ~90% Recurring Revenue 20+ Consecutive
Years of Revenue Growth $44.4M FY2011 EBITDA 60.6%, 36.9% FY2011
Gross, EBITDA Margins $165M 10-Year Cumulative Dividends Paid The
Global Leader in Radiation Science and Services 3 Slide 4
Investment Highlights Comprehensive Portfolio of Best-in-Class
Service Offerings and Technology Market Leading Positions in
Attractive Segments Global, Integrated Platform and Infrastructure
Large, Diverse Client Base Generating Recurring Revenue Deep and
Experienced Management Team Compelling Financial Model History of
Strong Cash Flows and Dividend Yield Global Leader in Radiation
Science & Services 4 Slide 5 Value Creation Deliver Upside
Growth 1.Optimize Core 2.Competitive Growth 3.Strategic Expansion
Strategic Priorities Landauer Strategy Overview Strategic
ExpansionOptimize the CoreCompetitive Growth New Management in 2006
New CFO in 1Q12 Restructure: Cost IT/ERP system upgrades OSL /
InLight new international market access New Channels and
Geographies Military, First Responder, International. New
Products/Existing/Channel Patient Monitoring Radiation Safety
Continuum Medical Physics acquisitions IZI Medical Products
Acquisition Leverage core competencies and footprint to expand
market opportunity 5 Slide 6 Therapeutic / Diagnostic Accessories
Information Imaging Physics Therapy Physics Patient Monitoring
Occupational Monitoring Consulting Strategic Expansion Existing
Services with Penetration Opportunities* Complementary Adjacent
Products / Services _____________________ (*)Average Revenue per
Facility greater than $405K. The Radiation Safety Continuum 6
Medical Products Medical Physics Radiation Monitoring Greater than
$1.5 Billion Market Opportunity Slide 7 Addressable Markets
2005201020112012 Occupational Monitoring Radon Military Emergency
Response Forensics Dose Reconstruction Patient Dose Consumer
Radiation Radiation Markers Radiation Shielding Occupation
Monitoring Radiation Instruments Radiation Measurements Patient
Dose Information Management Commissioning Data Analytics Peak
Demand Services Imaging Therapy Medical Products Medical Physics
Radiation Measurements Center For Innovation = OUR ROADS TO GROWTH
IN EXCESS OF $1.5 BILLION GLOBAL MARKET POTENTIAL Strategy Overview
Through the Lens of 2012 7 Slide 8 Global, Integrated Platform and
Infrastructure 8 National Offices Subsidiaries - # Affiliates - #
InLight Installations - # 8% 17% 75% Geographic Revenue Mix
Fairborn, OH So Carlos, Brazil Ibaraki-ken, Japan Oxford, U.K.
Beijing, China Drummoyne, Australia Fontenay-Aux-Roses Cedex,
France Mexico City, Mexico Uppsala, Sweden Stillwater, OK Glenwood,
IL Istanbul, Turkey 78,000+ Annual Customers Served Healthcare
Focused Customer Base (~90%) 1.7 million Annual Individuals Served
Global Reach Slide 9 Landauer Business Overview Investor
Presentation May 2012 9 Slide 10 10 Three Reportable Operating
Segments Radiation Monitoring Complete radiation dosimetry
services, including the manufacture, distribution and collection of
various types of radiation detection monitors, and the analysis and
reporting of exposure findings. Medical Physics Leading nationwide
provider of therapeutic and imaging physics services to the medical
community; medical physics services to hospitals, free standing
imaging centers and radiation therapy centers. Medical Products
Leading provider, internationally and domestically, of high quality
medical consumable accessories used in radiology, radiation
therapy, and image guided surgery procedures. Slide 11 Occupational
Radiation Monitoring Overview Service & Product Offering
Overview 84% contracted services / 16% equipment Occupational
Radiation Monitoring Radiation exposure measurement and monitoring
Full-service technical, analytical and client support Servicing
healthcare, energy, national security, and industrial markets Risk
Mitigation for Employers Comprehensive Data Management Emergency
Preparedness Patient Radiation Safety MicroStar InLight
ReaderLuxel+ InLight Model 2 11 Fiscal 2011 Segment Revenue: $100M
RadLight ReaderRadWatch Slide 12 Military and Emergency Response
Market Opportunity Expanding application of next generation
technology to pursue global military and first responder radiation
monitoring markets The U.S. military has now issued orders in
excess of $17 million to upgrade the Armys tactical dosimetry
capabilities, and dosimetry laboratory Substantially completed
first article testing and plan to begin Radwatch system shipments
in Q3 12 Currently pursuing two additional orders with the military
for approximately $5.5 million Recognition of global military
interest in the Radwatch system - discussions with six additional
military organizations outside of the U.S. Developing mutual aid
response strategy to synchronize first responders, military
radiation monitoring strategies, and the nuclear industry Shipped
the first FEMA emergency response order in Q1, with additional FEMA
shipments in Q2 12 Slide 13 Medical Physics Market Market Dynamics
/ OpportunitySize / Mix $1.0 billion domestic market (largest
player in market by 3x) Approximately 6,000 hospitals perform 37
million nuclear medicine procedures per year (10 million in U.S.)
Radiopharmaceutical utilization growing at over 10% per year Highly
fragmented and regional, primarily small competitors significant
consolidation opportunities Contractual relationship with ~5,000
hospitals for Occupational Radiation Monitoring provides
significant cross-selling opportunities for Medical Physics
business ($ in millions) $800 $200 Total U.S. Medical Physics
Market $1,000 13 Slide 14 Medical Products Overview 1991 Founded
Baltimore, MD Headquarters ~30 Employees 100% Recurring Revenue
1,000+ Annual Customers Served Expected Contribution* projected to
be $1.1 million to $1.5 million of net income in fiscal 2012
Products focused on four main categories: Tracking, Reference,
Positioning, & Comfort High Quality Medical Consumable
Accessories Provides high quality medical accessories used in
Radiology, Radiation Therapy, and Image Guided Surgery procedures
Over two decades of research and development expertise Products
increase procedural accuracy while decreasing procedural time
Demonstrates a history of new and innovative product launches Broad
consumable product portfolio used with: MRI, CT, and Mammography
technologies Image Guided Surgery procedures 14 * Impact of the
November 2011 acquisition of IZI Medical Products projected to be
$1.1 million to $1.5 million of net income for the 10 months
included in fiscal 2012 Slide 15 Financial Overview 15 Investor
Presentation May 2012 Slide 16 Landauer Financial Overview ($ in
millions, FYE 9/30) Revenue ($ in millions, FYE 9/30) EBITDA
Approximately 90% of revenue derived from subscription and is
recurring in nature Radiation Monitoring business growing
organically in the 3% to 5% range going forward Contract with U.S.
military to replace its antiquated radiation monitoring system
provides opportunities to expand to other global military and first
responder markets Strategic expansion contributing to long term
growth prospects. Strong history of EBITDA to support dividend
return to shareholders, reinvestment in the core business and
capital required to support strategic expansion. 27% growth in
revenue and 12% growth in EBITDA expected in FY2012 reflecting
execution of business strategy. FY2012 EBITDA adjusted for
non-recurring system start up costs is estimated to be between $53
and $57million. 16 * Midpoint of guidance Slide 17 17 Revenue grew
21 percent to $39.1 million Gross profit grew 11 percent to $23.1
million on increased revenue and improved business mix The US
military continued to expand relationship with Landauer, generating
international military interest Medical Products segment
contributed $4.0 million in Q2 Operating income of $10.1 million,
includes $1.3 million expense related to: Acquisition related
expense, $0.3 million IT Platform Enhancement, $0.3 million
Non-cash stock based compensation expense, $0.6 million GAAP Net
income of $7.1 million, or $0.75 per diluted share, included: $0.10
of non-recurring and non-cash charges, after giving effect to tax
Dividend paid of $0.55 per share for the second fiscal quarter of
fiscal 2012 Providing an annual dividend rate of $2.20 Paid on
April 3, 2012 Q2 Adjusted EBITDA of $14.9 million and YTD Adjusted
Free Cash Flow of $21.8 million Fiscal 2012 Second Quarter
Highlights Slide 18 *Note: Fiscal 2009 non-GAAP Net Income excludes
$1.8M after-tax impact of charges Historical GAAP Financial
Performance 18 Revenue, Net Income & Cash Flow from Operations
($ in Millions) Slide 19 19 Competitive Dividend Policy Competitive
Average Dividend Yield Slide 20 Current Dividend Policy and Outlook
20 Dividend Policy Board of Directors declared a regular quarterly
cash dividend of $0.55 per share for each of the first and second
quarters of fiscal 2012 This represents an annual rate of $2.20 per
share, consistent with fiscal 2011 levels The First Quarter
dividend was paid on January 4, 2012 to shareholders of record on
December 9, 2011 The Second Quarter dividend was declared on
February 28, 2012 and will be paid on April 3, 2012, to
shareholders of record on March 9, 2012. Fiscal 2012 Outlook
Expected Revenue $150 to $157 million, which includes 10 months of
contributions from the recent IZI Medical Products acquisition
Adjusted EBITDA of $53 to $57 million Net Income of $21 to $23
million, including non recurring charges reflected above The
accretive impact of the November 2011 acquisition of IZI Medical
Products projected to be $1.1 million to $1.5 million of net income
for the 10 months included in fiscal 2012 Slide 21 Appendix 21
Investor Presentation May 2012 Slide 22 22 Transition of Landauer
Financial Metrics Slide 23 Long Track Record of Growth and
Innovation 1954 19681991199520032006200820102009 Landauer is
founded Tech/Ops Landauer changes name to Landauer, Inc. 2011
Introduces InLight dosimetry system Signs first long- term military
contract ($12M) ($ in millions) 20+ Years of Consistent Revenue
Growth Landauer merges with Tech/Ops, Inc. Becomes the first U.S.
company certified by Canadas Atomic Energy Commission 19921998 An
office is opened in the United Kingdom Hired new management team
Signs contract with National Dosimetry Services of Health Canada
Completes 3 tuck-in Medical Physics acquisitions Develops new
technology specifically for the U.S. military and first responder
markets Acquires OSL crystal manufacturing facility Completes 2
tuck-in Occupational Radiation Monitoring acquisitions Acquires
Upstate Medical Physics 23 Acquires Global Physics Solutions
Introduces Luxel, first OSL dosimeter for broad market use Acquires
IZI Medical Products _____________________ (1)Indicates mid-point
of FY2012 guidance Slide 24 Radiation Safety Continuum Occupational
Radiation Monitoring Radiation Dose to Workers Market leader in
radiation dosimetry services and equipment Full range of products
and services utilizing proprietary technology continually evolving
over 50 years Utilize proprietary OSL dosimetry technology for
determining radiation exposure Critical services and products
applicable to multiple industries and new emerging opportunities
Medical Physics Radiation Dose to Patients Leading provider of
clinical physics support to monitor radiation delivered by imaging
equipment Offers full scope of medical physics services to
hospitals and oncology centers Thought leadership and unmatched
medical physics expertise 24 To Protect and Improve Health Globally
Through our Leadership in Radiation Science and Services IZI
Medical Products Radiation Dose Accuracy Provides high quality
medical accessories used in Radiology, Radiation Therapy, and Image
Guided Surgery procedures Demonstrates a history of new and
innovative product launches Broad product portfolio Over two
decades of research and development expertise Products increase
procedural accuracy while decreasing procedural time Slide 25
Radiation Monitoring Segment Overview Competitive Differentiators
Proprietary OSL (Optically Stimulated Luminescence) and InLight
technology Immediate notification of radiation overexposure
Complete historical records for individuals monitored Online data
and account management tools Comprehensive radiation exposure
reporting options Productivity leader with advanced automation and
IP infrastructure Recent Developments Innovation and new technology
expanding addressable market to include Global military & first
responders opportunity Provider of choice in newly developed market
Implementing consolidated front-end system to re-engineer legacy
order-to- cash systems complete with state-of-the- art web-enabled
capabilities Capital outlay largely complete Implemented state of
the art facility in Japan with JV partners in April 2010 Awarded
contracts ~17 nuclear power plant facilities, increasing market
share above 52% 25 Slide 26 Emergency Response Mutual Aid /
Synchronization National Guard Army - Tactical Army Overseas
Contingency Operations Army - CCMRF Army Redstone Arsenal NYC Fire
Department LA County Pennsylvania Emergency Management Agency
(PEMA) Illinois Emergency Management Agency (IEMA) FEMA Urban
Search and Rescue Nuclear Power Plant Japan Crisis 30% Margins60%
Margins Military First Responder Corollary Markets 26 Slide 27 $235
$365 Occupational Radiation Monitoring Market Market Dynamics /
Opportunity Size / Mix Annual growth rates of 3% to 5%
(international growing faster) Heightened awareness and concern for
worker safety and more workers in contact with radiation driving
increased demand Further expansion of addressable market into
nuclear, military, first responder, and medical patient monitoring
Two players of scale include Landauer and Mirion fragmented
landscape with further opportunities for consolidation Total
Occupational Radiation Monitoring Market $600 Outsourced
Occupational Radiation Monitoring Market $365 ($ in millions) 27
$45 $210 $25 $60 (1) _____________________ (1) Includes $100
million of U.S. military and first responder applications. Slide 28
Medical Physics Segment Overview Service Offering Overview
Full-service, national medical physics practice group Therapy
physics Diagnostic physics Equipment commissioning services
Accreditation support ~ 90% of revenue is recurring Provides full
scope medical physics services to: Hospitals Free standing imaging
and radiation oncology centers: Midwest, New York, Connecticut,
Texas, North & South Carolina, and Florida Uniquely positioned
to leverage the emerging C-Suite visibility trends Made upfront
investments in geography and in people who will add credibility in
future potential partnerships 28 Fiscal 2011 Segment Revenue: $21M
Slide 29 New accreditation requirements for imaging reimbursement
oMedicare and private payers oAnnual calibration and testing Growth
in equipment placement oDiagnostic imaging oLinear accelerators
Increasing physicist oversight of radiation departments
Technological improvements and complexities in imaging modalities
Demographic fundamentals oAging population oGrowth in cancer cases
Increased utilization of radiopharmaceuticals Increasing use of
Intensity-Modulated Radiation Therapy (IMRT) Current: Overall
market equilibrium for physicists oUnemployment rate
