ANACOMP(R)
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ANACOMP(R)
MANAGEMENT
FORMED A CROSS FUNCTIONAL MANAGEMENT TEAM THE "KITCHEN CABINET"
Focus on key areas of the business:
o Critical Cash Control
o Cost Management
o Business Unit Structure & Strategy
o Increase Sales
o Human Resources
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ANACOMP(R)
CRISIS MANAGEMENT "KITCHEN CABINET"
SPEED essential, TIME the enemy!
KITCHEN CABINET PRIORITIES
o Act FAST
o Daily communications & reports
o Teamwork
o Connection to all parts of the business
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ANACOMP(R)
THE BEGINNING - JULY 26TH
The Team somewhat blindly jumped into the process, but there were some positives
we had to work with:
o Good gross margins & cash generation from the core businesses
o Document Solutions - US
o Technical Services - Worldwide
o Strong fundamental capabilities
o Customer Service culture
o Thousands of existing customers
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ANACOMP(R)
SHORT-TERM ACTION PLAN
SUMMARY
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o Maintain positive cash balance
o Explore sale of non-strategic assets
o Stabilize financial performance
o Find investor for docHarbor
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CRITICAL CASH (JULY 26 -- DEC 31)
Had to improve cash position weekly
o Over $21 million improvement since July 26th
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COST CONTROL
REDUCING SPENDING THROUGH THE COMPANY
o Restructured docHarbor & Document Solutions - US
o Reduced CapEx spending to bare minimums
o Completed sale of Poway facility
o Downsizing Corporate Services
o Instituted new spending & travel approval process
o And many more...........
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ANACOMP(R)
SELL NON-CORE ASSETS
9 originally identified
o Data/Ware, Image Mouse & Archive Storage sold
o Document Solutions International in whole or parts in process
o Sales of other non-core assets also possible
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ANACOMP(R)
BUSINESS STRATEGY
Focus on digital services and sales vs. traditional COM business activities in
all 3 business units
Reorganize and restructure to improve leadership & focus
Sell non-core assets
Document Solutions and docHarbor - communicate and work in parallel together
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ANACOMP(R)
CLEAR LEADERSHIP & FOCUS
REORGANIZE DOCHARBOR
o Reduced headcount wherever possible
o Focus sales & development activities in Financial Services Market
o Increase revenue
o Preserve key employees
REORGANIZE DOCUMENT SOLUTIONS
o Reduced headcount wherever possible
o Focus sales & operations activities on new digital services
o Streamline all functional areas
o Preserve key employees
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ANACOMP(R)
FROM DECLINE TO GROWTH
SHARPER FOCUS ON INCREASING DIGITAL SALES
o New CD & On-Line Services
o Web Presentment using docHarbor
o Third-Party Maintenance
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ANACOMP(R)
HUMAN RESOURCES
THE PEOPLE OF THE COMPANY
o Restructure as necessary - match expense to revenue
o Communicate often & using multiple methods
o Meet face-to-face - talk & listen to People
o Centralize HR function for consistency
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ANACOMP(R)
BANK GROUP - EXTENSION
o Forbearance of default remedies for 120 days (through Feb. 28, 2001)
o Maintenance of the revolver facility during 120 day period
o Remittance of proceeds from Document Solutions International sale, net of
all international liabilities
o Maintenance of other current standstill provisions during 120 day period
o Authorization of letter of credit for new Technical Services office space
o Limited additional access to credit line
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ANACOMP(R)
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ANACOMP(R)
ANACOMP - 1997
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BUSINESS PORTFOLIO - SINGLE BUSINESS + MAGNETICS:
o COM equipment & Micrographic supplies (just added CD systems)
o COM equipment maintenance (just started TPM)
o COM outsource services (initial CD-R services)
o Magnetics
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ANACOMP(R)
ANACOMP - 2000
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BUSINESS PORTFOLIO - SEPARATE BUSINESS UNITS:
o Internet document services - docHarbor
o Document outsource services - Document Solutions
o COM & Third Party equipment maintenance - Technical Services
o COM/CD equipment & Micrographics supplies - DatagraphiX (disbanded as of
Sept 30th)
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ANACOMP(R)
TIMELINE 1997 - 2000
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<TABLE>
<CAPTION>
97 98 99 00
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
docHarbor Separate & brand
as DocHarbor
Establish Herndon
facility
DS - US Launch CD-R Acquire First Launch Internet Launch New
Services Image (COM) Document Services digital offerings
(using IBM - DFW) incl. Web Presentment
Launch FileNet Acquire WorkSmart
Concerto (Consulting) Acquire Adesso
Software
Launch ND EOM
product
DS - Int'l Initial Doc Solutions Additional acquisitions Additional acquisitions Swiss acquisition
acquisitions (3) in in IT, FR, UK (4) in IT, FR, UK & SW (5) (Bgin)
SW, UK, Benelux
TS - WW Initial TPM Acquisitions of Continued TPM Continued TPM
contracts small Xerox TPM growth, Xerox TPM growth, increased
businesses (2) acquisition (1) COM decline
DX - WW Acquire DWD Terminate Launch Contract H/W business
CD systems DragonCOM Mfg. business declines
Final Kodak Exit Dup Film Launch Image Terminate Mfg.
IW sale Resale business Mouse businesses
Magnetics Divest to Windward
Capital (eMag)
</TABLE>
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OVERVIEW
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ANACOMP(R)
Document Solutions
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ANACOMP(R)
Document Solutions
OFFERINGS
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o Media-based Document Services
- Computer Output Microfiche (COM)
- CD Document Services
- Image Capture (Scanning)
- Laser Print Services
o On-Line Document Services
- Web presentment
- Online access
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ANACOMP(R)
Document Solutions
LOCATIONS
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North America
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o 48 Outsourcing centers
Europe
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o 10 Outsourcing centers
o 3 key regions
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ANACOMP(R)
Document Solutions
MARKETS
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1999
Financial Services Sectors
66%
Banking 13%
Investment Services 32%
Insurance 21%
All Others 34%
Total: Financial Services 66%
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ANACOMP(R)
Document Solutions
DOCUMENT SOLUTIONS
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o US & International distinct businesses
o US business
o Cash positive business
o Net COM decline continuing
o Digital services continuing to grow
o Increase focus on digital - - new services recently introduced:
o Web Presentment Services: docHarbor platform
o On-Line CD Services
o PDF-CD Services
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ANACOMP(R)
Document Solutions
DOCUMENT SOLUTIONS
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o International business
o Revenue flat (without Bgin acquisition)
o Bgin acquisition (Swiss) results disappointing
o De-emphasizing systems integration business, focusing on recurring
services revenue
o Poor EBITDA overall
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OVERVIEW
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ANACOMP(R)
Technical Services
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ANACOMP(R)
Technical Services
OFFERINGS
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o On-site Installation & Maintenance of Computer Room & Networking Equipment
- COM systems and related equipment
- Storage (Optical, Tape, CD, RAID) systems
- Hi-volume Laser Printing systems
- Network Routers, Converters
o Micrographic supplies & refurbished COM systems added as of October 1st
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ANACOMP(R)
Technical Services
LOCATIONS
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North America
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o 175 service points
o 6 regions
Europe
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o 70 service points
o 7 regions
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ANACOMP(R)
Technical Services
MARKETS
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FY00 Market Segments
COM 69%
Storage 19%
Printers 12%
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ANACOMP(R)
Technical Services
TECHNICAL SERVICES
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o US & International very similar businesses
o Generally healthy business, but ...
o Significant decline in legacy COM maintenance
o COM Maintenance decline has increased in FY00
o No "net new equipment" being sold & installed
o Post Y2K transition
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ANACOMP(R)
Technical Services
TECHNICAL SERVICES
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o Business needs investment to grow over COM maintenance declines
o Many OEMs & equipment types covered
o Opportunity in Network Services
o Need to provide "one-stop shopping"
o No synergy with remaining Anacomp business after exit of equipment
manufacturing business
o Only "internal" equipment maintenance in DS service centers remains
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ANACOMP(R)
Technical Services
SUPPLIES BUSINESS
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Micrographics supplies
o Proprietary Film & Chemistry
o Non-Proprietary Film & other types of supplies
o Mostly recurring revenue to installed base of COM users
o 50% of revenue is proprietary film & chemistry for the DatagraphiX
XFP2000 COM system
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ANACOMP(R)
Technical Services
DATAGRAPHIX
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INTEGRATE DATAGRAPHIX SUPPLIES BUSINESS
o Exited manufacturing of new equipment on Sept. 30th
o Sold the rights to Data/Ware and Image Mouse assets
o Working to sell rights to COM systems & ANEW assets
o Integrated Supplies business and Repair/Refurb of COM equipment into
Technical Services
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ANACOMP(R)
Technical Services
DATAGRAPHIX
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o Exiting Manufacturing space in Poway
o Reduction would equal 200,000 sq.ft.
o Relocate Technical Services to separate facility in the area
o Savings of approximately $3M p.a.
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ANACOMP(R)
Technical Services
OVERVIEW
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docHarbor (Service Mark)
The place where e-documents work.(Service Mark)
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docHarbor (Service Mark)
The place where e-documents work.(Service Mark)
BACKGROUND
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o Startup business - launched in May 1999 in Document Solutions
o Capitalize on the potential of the ASP model
o Market study led by Chicago Strategy Associates & Kellogg School in 1999
o Blending of 2 organizations
- Adesso Software
- Anacomp
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docHarbor (Service Mark)
The place where e-documents work.(Service Mark)
OFFERING
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o Safe, secure, expert approach to storing, accessing & viewing customer
information
o Document indexing, hosting & display across the Web
o World-class process to design unique approach for each customer
o Application specific solutions for vertical markets
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docHarbor (Service Mark)
The place where e-documents work.(Service Mark)
MARKETS
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Investment
Insurance Banking Services
--------- ------- --------
Policies Item Archives Statements
Claims Statements Email Archives
Compliance Reports E-Confirms
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docHarbor (Service Mark)
The place where e-documents work.(Service Mark)
CUSTOMERS
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o AMEX
o Fidelity Investments
o Federal Express
o ADP Brokerage
o Pershing
o NCR
o Credit Suisse
o Mail 2000
o Delta Airlines
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