The Value is in the Data
Imation Corp.
Annual Meeting of Shareholders
May 8, 2003
William Monahan
Chairman and Chief Executive Officer
1
Risk Factors
Certain information contained in this presentation which does not relate to historical financial information, including
the 2002 Outlook and long-range goals, may be deemed to constitute forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties
that could cause the Company’s actual results in the future to differ materially from its historical results and those
presently anticipated or projected. Among these factors are continuing uncertainty in global economic conditions that
make it particularly difficult to predict product demand, the Company’s ability to meet its cost reduction and revenue
growth targets, its ability to implement its restructuring programs for the estimated costs on a timely basis and to
achieve the projected benefits, to introduce new offerings in a timely manner either independently or in association
with OEMs or other third parties, the competitive pricing environment, foreign currency fluctuations, the outcome of
litigation, the ability of Imation to secure adequate supply of certain high demand products, the ready availability and
price of energy, the market acceptance of newly introduced product and service offerings, the rate of decline for
certain existing products as well as various factors set forth in the Company’s filings with the Securities and
Exchange Commission.
2
Imation Is….
• Leading worldwide supplier of removable data storage media with 50
years of experience
• 2002 revenue $1.004 billion; $260 million in Q1’03
• 54% of revenue outside the U.S.; market presence in more than 60
countries
• 2,800 employees globally
• More than 300 technology scientists; more than 300 U.S. Technology
patents
• New York Stock Exchange ticker symbol “IMN”
• Headquartered in Oakdale, Minnesota
3
Imation’s Vision
… To be the recognized leader in the removable data storage media
industry; the trusted source for digital storage of information
important to consumers and businesses alike; and the independent
experts in data storage back-up, archiving, security and protection.
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Ethical Business Practices are a Top Priority
• Our corporate reputation is considered our most valuable asset
• Strong disclosure control procedures established
–
Meets all established requirements of Sarbanes Oxley/SEC & NYSE
– All financials are supported by extensive internal representations
– Independent Audit Committee has financial expertise
– Imation’s Board has been strong and independent since spin-off
• Business ethics apply to more than financial disclosure
– Business Conduct Policy and Manual and an employee hotline established
– Extensive leadership training conducted on enhancing ethical business culture
– High ethical standards are required in all business relationships:
• Fellow employees
• Customers
• Suppliers
• Partners
• Investors
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The Value is in the Data
1. The data storage removable media market is an attractive
sustainable growth market
• 5–10% CAGR
• Imation share ~16-18%
2. Imation is well positioned to grow profitably in this market
• Strong technology base
• Global presence
• Broad portfolio
3. Experienced management team and data storage removable
media focus create value for customers, employees and
shareholders
7
Data Storage Removable Media Market is a
Sustainable Growth Market
Total Market - 2002
Imation - 2002
~$6 Billion Market
$1.004 Billion Revenue
4 Year CAGR ~5-10 %
Market Share ~16-18%
Enterprise = ~$400 M; ~2-5% 4 Year CAGR
Network/Server = ~$2.3 B; ~5-10%
4 Year CAGR
Personal Storage = ~$3.2 B; ~6-12%
Source: Gartner/Dataquest, Forrester Research IDC, Imation estimates
4 Year CAGR
}
B2B - tape cartridges
B2C, B2B - diskette, optical
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Capacity, Levels of Automation and Transfer
Rates Vary Across Applications and Products*
Capacity starts at 1.44MB
Greater Single Use of Media
Transfer rate starts at ~ 12 Mb/sec
Personal Storage
Applications
CD-R, CD-RW,
DVD optical discs;
1.44 Mb diskettes,
Devices/Accessories
Entry-Level Network
Server Applications
Travan™/Travan™ NS
4mm/8mm, SLR
Tape Cartridges
*Product capacities may vary based on compression rate.
Highest Capacity: ~200GB
Greater Use of Tape Automation
~40 MB/sec peak transfer rate
Mid-Range Network
Server Applications
BlackWatch™ Ultrium,
BlackWatch™ DLTtape,
BlackWatch™SuperDLTtape
Cartridges
Enterprise-Class
Applications
BlackWatch™ 9840, 9940;
BlackWatch™ 3590, 3590E,
3480, 3490E;
Royal Guard™ 3480
9490EE Tape Cartridges
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Imation Reaches Customers in More Than 60 Countries;
54% of Revenue Comes From Outside the U.S.
Regional Revenue Mix
Q1 2003
30%
U.S. Sales
$126.8 Million
OUS Sales
$146.5 Million
17%
5%
46%
U.S.
Europe
2%
Asia
Latin America
Canada
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Financial Milestones - 2002
• Revenue growth in Data Storage across all geographies and customer
sectors
• Data Storage revenue grew 14.6% and topped $1 billion in 2002, setting a
record for this business
• Earnings per Share of $0.58 for Q4 and $2.05 for the year
• Cash reached a record $474.7 million; more than $13 per share
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Imation
StorageTek
S&P 400 Index
EMC
ADIC
Apr-03
Mar-03
Feb-03
Jan-03
Dec-02
Nov-02
Oct-02
Sep-02
Aug-02
Jul-02
Jun-02
May-02
Apr-02
Mar-02
Feb-02
210
200
190
180
170
160
150
140
130
120
110
100
90
80
70
60
50
40
30
20
10
Jan-02
Value
IMN Outperformed Peers and
Benchmarks; Gained 62.2% in 2002;
12th Best Performing U.S. Stock
Quantum DSS
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First Quarter 2003 Highlights
• Data Storage revenue increased 3.1% year-over-year to a record
$260 million
• Gross Margin of 31.9%
• Record low SG&A spending at 15.2% of sales
• Record operating income of $32.8 million
• Earnings per share of $0.59 vs. $0.45 last year
• Cash increased to $480.1 million
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Financial Condition is Strong
A financial turnaround of nearly $1 billion has
been achieved since Q1 1998
($ millions)
Debt
500
450
400
350
300
250
200
150
100
50
0
Cash
Cash/Stock
Share Repurchase
Debt
432
375 371
390 380
415
475 480
441
322 323
270 287
129
79
24
38
64
42
153
62
167
212
195 200 211
153 153 154 163 164 164
153 153
138 153
135
164
164
5
5
87
76
6
500
450
400
350
300
250
200
150
100
50
0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
98 98 98 '98 '99 '99 '99 '99 '00 '00 '00 '00 '01 '01 '01 '01 '02 '02 '02 '02 '03
Debt/Cap % 34
30
29
7
3
2
2
4
4
3
4
4
2
2
2
2
2
2
1
1
1
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Imation’s Business Model Provides
Significant Competitive Advantages
• Removable media business provides annuity-like revenue stream due to
large installed base of OEM drives
• The only company focused solely on data storage media
• Broadest portfolio of products in the industry
• Strongest distribution channel position worldwide
• Most extensive global presence
• Strong balance sheet can support profitable growth
• Strong and extensive OEM relationships
• Only U.S. based manufacturer in the industry
• Quality Improvement and Cost Reduction (QICR) focus and experience
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Key Strategic Objectives
10% Revenue Growth at 10% + O.I.
• Increase Imation’s value and relevance to all our customers and partners
• Drive technology development and leadership for competitive advantage
• Quality improvement/cost reduction and total quality process management
focus
• Supply chain excellence globally
• Talent development
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Leverage Our Strong Financial Position
to Achieve Profitable Growth and Shareholder Value
• Launch new products/strengthen market share
– Ultrium/LTO3
– DVD-R and DVD-RW
– 9840C+
• Implement MBI JV to increase share of the optical market
• Accelerate activity in new market opportunities
– Government and security
– China
– Broadcast
• Investigate adjacent opportunities
• While we continue disciplined cost management for ROI
17
The Value is in the Data
1. The data storage removable media market is an attractive
sustainable growth market
2. Imation is well positioned to grow profitably in this market
3. Experienced management team and data storage removable
media focus create value for customers, employees and
shareholders
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