Annual Results for year ended 31 December 2013

Anthony Sethill, CEO

Jonathan Apps, CFO

31 March, 2014

1

Contents

1. Group Overview

2. Wireless Healthcare

3. Connected Audio

4. Digital Radio

5. Financials and Summary

2

• Wireless

Healthcare

Toumaz: semiconductors for low power wireless connectivity

• Connected Audio

• Digital Radio

• Focus on high growth markets

- pioneer in wireless healthcare

monitoring

- innovator in connected audio

(platform for Internet of Things)

- #1 provider of solutions for digital

radio

• Group revenues: £21.9m FY13 Core skills / common

technologies

3

• Toumaz’s ultra-low power connectivity solutions address opportunities within Internet of Things and

wearable technologies

Strategy and objectives

Lines of business What we do Goals for 2014/15

Wireless Healthcare • SensiumVitals®: wireless monitoring of

vital signs

- low power, disposable

- general wards, A&E (and home)

• Create effective global

sales & marketing platform

• Enhance functionality

Connected Audio • High quality solutions for mass market

- Bluetooth and Wi-Fi turnkey solutions

- integrated content streaming services

- enhanced functionality, e.g. multi-room

• Extend content streaming

partnerships

• Top two solutions provider

Digital Radio • DAB / DAB+ in Europe and Asia Pac

• Developing HD radio for US

• Drive growth of DAB /

DAB+ market

• Enter HD market (2014)

4

Significant milestones achieved

Funding • £17.2m (net) raised – to take Group to break-even in H2 2015

Healthcare

• Direct sales and distribution for territories accounting for 60% of world

healthcare expenditure

• First commercial order: Hurley Medical Center, Flint, Michigan (A&E)

• CE Mark (Sep 13); Spire Healthcare UK pilot in soft launch

Connected

Audio

• Partnerships with Spotify and Imagination content streaming services

• Design wins include Pure, Media Saturn and Revo

Digital

Radio

• International markets growing; UK government signals digital future

• Frontier retained 80% market share of consumer DAB market

• Next generation silicon (Chorus 4) samples – working / being tested by

strategic customers, e.g. Sony

5

Contents

1. Group Overview

2. Wireless Healthcare

3. Connected Audio

4. Digital Radio

5. Financials and Summary

6

• Market growth driven by

- growing demands on health providers

(aging populations, chronic diseases)

- pressure to improve patient care / save

costs

- capabilities of enabling technologies 82

128

185

264

370

2013 2014 2015 2016 2017

Global hospital wireless patient / vital

signs monitoring, $m revenue1

45%

CAGR

Sources: (1) ON World “Health & Wellness Wireless Sensor Networks” Report 2013; (2) Novasecta (March 2013), ON World (ibid)

Wireless monitoring - high growth opportunity

7

SensiumVitals® - turnkey solution for vital signs monitoring

• Disposable patch (five days battery life) for general wards and A&E

- patient data (heart rate, respiration, temperature) taken every two minutes

- sent wirelessly to hospital IT system - provides early warnings

Hub

• FDA 510k cleared

• CE Mark approved

• TGA approved

1

(1) Electronic Medical Records

8

SensiumVitals® addressing 60% of global healthcare spend

Sensium Healthcare direct salesforce: UK, France, Germany

Third party distributors: US, Canada, Mexico, Sweden, Norway, Denmark,

Portugal, Bahrain, Australia and New Zealand

New North American

distribution agreement

with NantHealth (Oct 13)

CE Mark

(Oct 13)

TGA approval

(Mar 14)

9

First US deployment: Hurley Medical Center, Michigan

Hurley Medical Center, Flint, Michigan

• Deployment in one of the largest

Emergency Departments in US

• Will monitor patients, post-triage,

who may wait for extended periods

• System installed; full launch May 14

10

First UK deployment: Spire Healthcare

Spire Healthcare, Montefiore Hospital,

Brighton & Hove, UK

• Leading UK private hospital group

(38 hospitals)

• System installed and tested at

Montefiore Hospital

• Soft launch underway

- being integrated with ADT system1

- full launch planned for May 14

(1) Admissions, Transfers and Discharges

11

• Hospital interest driven by

- enhanced patient care (early warnings)

- ability to monitor patients waiting in A&E

- monitoring of patients in private wards

- patient mobility (speeds recovery)

- financial benefits of early intervention

• Policy focus on technology in health1

45

7 8

UK, France,

Germany

North America Rest of World

Number of qualified prospects by region, March 2014

Current pipeline of 60 potential customers

(1) e.g. in response to Francis Report

12

Next steps

• Lower costs and extend range of patches

• Additional vital signs (SpO2, blood pressure, ECG)

Product

development

• At least one major health economics study in 2014 – to provide

additional evidence of SensiumVitals® benefits

Health

economics

• Assess opportunities in

- home health: post-discharge, long term chronic disease management

- assisted care

New market

sectors

• Extend distribution coverage – especially, Europe & Middle East

(2014) and Japan (2015)

New

territories

13

Contents

1. Group Overview

2. Wireless Healthcare

3. Connected Audio

4. Digital Radio

5. Financials and Summary

14

• Connected audio devices rising from 34m units

p.a. (2013) to 67m (2017)

- smart devices

- cloud-based content streaming

• Wi-Fi to become leading standard

- 37m units p.a. in 2017

- superior functionality to Bluetooth (at cost-

effective prices)

97.9

130.8

189.9

271.0

349.0

2013 2014 2015 2016 2017

Global Wi-Fi connected audio market1,

$m

37%

CAGR

(1) Solutions for speaker docks, home theatre systems, speakers, A/V receivers, mini-systems, networked audio players / adapters,

multi-room audio systems. Source: Park Associates (Jul 2013), Frontier Silicon analysis

Connected audio via Wi-Fi poised for take-off

15

• Significant experience

in Internet Radio

• Hardware, software &

systems engineering

skills

• Apps & cloud-based

services

Frontier well positioned

Technology

skills Partnerships

Turn-key

solutions

Customer

relationships

• Global brands

• Importers / retailers

• Technology from

Imagination

Technologies

• Content from Spotify

• Competitors more

focused on silicon

• Frontier’s solutions

approach speeds time

to market

16

Q2 14: Apple Airplay & multi-room added to connected solution

Cloud

Content

Integrated proposition

• Multi-room streaming to wireless

speakers demonstrated at CES in

Jan 2014, available in Q2.

• Airplay will be added in April 2104

– opens up market for Apple

devices

• Strong customer interest

17

2015: Symphony, next generation solution for Connected Audio

• Solution for mass market

high quality connected

audio systems

- superior audio

experience

- reduction in cost, power

consumption and size

• Revenues mid-2015

Baseband Apps

processor

Audio

DAC Bluetooth

Modem

Multi-channel

audio

Symphony Baseband IC

PA Wi-Fi RF

NFC

Symphony RF IC

Symphony – two chip solution

18

Contents

1. Group Overview

2. Wireless Healthcare

3. Connected Audio

4. Digital Radio

5. Financials and Summary

19

• DAB / DAB+ market growth driven by

- Germany up 52% (2013)

- new territories: NL, Poland, France

- first countries nearing DSO: Norway

(2017) – up 148% in 2013

- “digital future” for UK radio

• Upside: global development of Digital

Radio, e.g. HD Radio (US), DRM (India)

DAB/DAB+ sales (consumer and

automotive aftermarket), $m

Sources: GfK, Frontier Silicon estimates (Oct 2013)

Strong growth from DAB / DAB+; upside from HD

36

47

6164 66

2013 2014 2015 2016 2017

16%

CAGR

Units

(m) 4.4 6.5 8.9 10.9 13.2

20

Frontier Silicon – #1 provider of solutions for digital radio

Portable

radios

Home audio

systems In-car

Clock radios

& docks

(1) Consumer and automotive aftermarket DAB / DAB+ devices

• In 2013, leadership

position maintained

- 80% market share1

• New products included

- Bluetooth-enabled

solution

- next generation

automotive software

21

2014: targeting the US HD Radio market

• US digital radio based on HD

Radio standard

• To date, market predominantly

automotive

• Frontier partnering with iBiquity

(developer of HD Radio), to

target domestic receiver market

US population density map

22

Next generation IC (Chorus 4) – launching H2 2014

• Advanced single chip solution

- power consumption: 50%

lower

- enhanced functionality1

- cost: 36% lower

- multiple (global) standards

• Timetable

- engage with “alpha

customers”: Q1 14

- revenues: Q4 14

RF Baseband & apps

processor

ROM

Audio

DAC

Chorus 4 – “four chips in one”

(1) For consumers, faster scanning / tuning, improved radio performance; for manufacturers, tools to enable faster time to market

23

Contents

1. Group Overview

2. Wireless Healthcare

3. Connected Audio

4. Digital Radio

5. Financials and Summary

24

Income statement

• Volumes up year on year, but revenues and

gross margin down

- reduced selling prices, as digital audio

solutions reach end of life

• Q1 2014 trading in line with expectations

• Digital Radio and Connected Audio division

trading profitably when R&D costs excluded

Full year 2013 2012

£m £m

Revenue1 21.9 22.1

Cost of Sales (12.2) (12.1)

Gross margin 9.7 10.0

Research & development costs2 (9.1) (9.8)

Sales & administrative costs (10.0) (11.4)

EBITDA (9.4) (11.2)

Depreciation and amortisation (3.0) (12.8)

Other non trading costs3 (0.9) (0.1)

Loss for the period (13.3) (24.1)

Unit volumes shipped (m) 3.5 3.3

(1) 2012 comparatives on pro-forma basis including Frontier Silicon from Jan 2012 and excluding £0.3m of non-recurring consulting

revenue in Toumaz Healthcare and £0.5m bad debt incurred by Toumaz in 1H 2012 (2) Group policy to expense R&D costs where

possible. (3) includes costs of share based payments of £0.8m in 2013.

25

Balance sheet at 31 December

£m 2013 2012

Non-current assets

Goodwill 19.1 19.1

Other intangible assets 17.7 17.7

Property, plant and equipment 0.7 0.9

37.5 37.7

Current assets

Inventory 1.5 1.8

Tax receivable 2.7 1.6

Trade and other receivables 4.2 3.3

Cash and cash equivalents 21.5 15.3

29.9 22.0

Total assets 67.4 59.7

Current liabilities

Trade and other payables 8.3 7.8

Equity

Share capital 4.1 2.8

Contingent consideration 0.3 1.1

Share premium 114.9 98.0

Share based payment reserve 2.5 1.9

Foreign exchange (0.1) (0.1)

Retained earnings (62.6) (51.8)

59.1 51.9

Total equity and liabilities 67.4 59.7

• Cash/net working capital in line with

expectations at end February

26

Financial objectives

• Group expected to be cash-flow positive in 2015

• Mid-term: grow revenue 5x by 2017

• Overheads and indirect costs continue to be kept under tight control

• Gross margins expected to improve from today’s blended 44% as a result of new

chip developments

27

• Focus: three high growth sectors

• Strategic goals

- establish SensiumVitals® as global leader in vital signs monitoring – in-hospital and

later in-home

- in Connected Audio, establish Frontier Silicon as leading silicon platform

- in Digital Radio, leverage leadership position to drive global market growth

• Financial objectives

- cash-flow positive by H2 2015

- increase revenues 5x by 2017

Summary