1. © Copyright 2003 Frost & Sullivan. All Rights Reserved. North American HVAC Thermostat Markets Legislation, Environmental Concerns, and Energy Conservation are Boosting Electronic Thermostats HVAC/Building Controls Group “Increasing energy prices, environmental concerns and energy conservation initiatives drives the market for sophisticated energy saving electronic thermostats in North America. Ease of use, accuracy, reliability, and competitive pricing are considered key attributes of HVAC thermostats.”

2. © Copyright 2003 Frost & Sullivan. All Rights Reserved. Industry Trends Economic slowdown and September 11 incidents have created a sharp impact on the commercial building industry reducing the demand for thermostats Increasing retrofit applications sustains the demand for thermostats in the North American market Legislations against the use of mercury based thermostats retards the growth for electromechanical thermostats Advanced customers-needs forced the users to migrate from pneumatic thermostats to sophisticated DDC controls Increasing energy prices and energy conservation initiatives drives the market for electronic thermostats Perception of complexity in programming by the end-users slows the growth for electronic thermostats Integration of thermostats with other building controls has led to the emergence of communicating thermostats

3. © Copyright 2003 Frost & Sullivan. All Rights Reserved. Key Features Frost & Sullivan provides: Drivers, restraints, challenges, and strategic recommendations Market sizing and competitive analysis Revenue and unit shipment forecasts Forecasts by end-user and analysis Forecasts by application type and analysis Forecasts by geographic regions and analysis Technology trends List of key market participants

4. © Copyright 2003 Frost & Sullivan. All Rights Reserved. What We Offer In-depth regional coverage: Four U.S. census regions and Canada Proven methodology encompassing extensive primary and secondary data and research Focused information and strategies that cover business and technology issues Credible data and analysis highlighting industry dynamics Winning strategies to help you create precise business plans

5. © Copyright 2003 Frost & Sullivan. All Rights Reserved. Who Will Benefit? Current Market Participants Find out how large is the North American thermostat market Identify how you compare to the competition Assess current and future drivers and restraints Determine and exploit new market opportunities Understand the growth prospects across each end-user segment New Entrants Analyze challenges associated with the industry Look out for possible alliance or acquisition targets

6. © Copyright 2003 Frost & Sullivan. All Rights Reserved. Who Will Benefit? (Cont’d) Manufacturers Identify competitors that are getting involved in different market segment Assess the levels of current and future demand for thermostats. Understand the trend and type of thermostats that are becoming increasingly popular Find out whether it is profitable to enter the thermostat market Investment Community Determine which participants will outperform the competition Understand the investment opportunity in the thermostat market

7. © Copyright 2003 Frost & Sullivan. All Rights Reserved. What’s Included Electromechanical thermostats Pneumatic thermostats Electronic thermostats - Electronic non-programmable thermostats - Electronic programmable thermostats Trends, drivers, restraints, forecast and analysis for all three main segment and two sub segments in electronic thermostat category

8. © Copyright 2003 Frost & Sullivan. All Rights Reserved. Key Market Participants  KMC Controls, Inc.  Lightstat, Inc.  Lux Products Corp.  PSG Controls, Inc.  Senercomm, Inc.  TCS/Basys Controls  Totaline  Viconics, Inc.  White-Rodgers/ Division of Emerson Electric Co.  XCI Corp.  Aprilaire/ Research Products Corp.  Aube Technologies, Inc.  Carrier Corp. / subsidiary of United Technologies Corp.  Danfoss - Building and Comfort Controls  Honeywell International, Inc.  Hunter Fan Co.  Invensys Building Systems, Inc.  Johnson Controls, Inc.  Kele Associates

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