1. July 15, 2011 www.charliebarnhart.com Q2CY2011 Results Q3CY2011 Forecasts

2. © Charlie Barnhart & Associates LLC Insights into the world of global electronics manufacturing 2 None of the material contained or presented in this presentation may be reproduced or republished without the prior written permission of Charlie Barnhart & Associates LLC. In preparing this information Charlie Barnhart & Associates LLC used its best efforts to ensure accuracy. The material presented and/or provided is presented ‘as-is’ and neither Charlie Barnhart & Associates LLC or its Principals make any warranty or assume any liability for its contents. Outsourcing Navigator © Copyright 2011

3. © Charlie Barnhart & Associates LLC Insights into the world of global electronics manufacturing Outline for Today 3 Introduction Industry Insights Closing Comments and Q&A Upcoming ONC activities

4. © Charlie Barnhart & Associates LLC Insights into the world of global electronics manufacturing Industry Insights 4 Capacity utilization for electronics manufacturing services remains available globally (net of Japan)… Geography Q4 CY10 Q1 CY11 Q2 CY11 Trend USA /Canada 55%58%60% Consolidation vs. expansion Mexico 80%87%88% Cautious re-alignment South America 75% 76% TBD due to high cost Western Europe <30% Re-structuring E. Europe € ~60% Re-structuring E. Europe non € 80%82%86% Cautious re-Alignment SE Asia 65%72%84% Consolidation vs. expansion China 85%87% Consolidation vs. expansion Vietnam <50%~60% Consolidation vs. expansion Singapore ~25%<25% Needs to be re-structured Australia ~65%~70%~72% Cautious re-alignment Middle East~90% Some expansion expected India ~90% Consolidation vs. expansion Capacity Utilization by Geography

5. © Charlie Barnhart & Associates LLC Insights into the world of global electronics manufacturing Industry Insights 5 Migration of business from China to SE Asia (and to a lesser degree E. Europe) is lengthening lead-times in SE Asia and this trend is expected to continue… EMSQ4 CY10Q1 CY11Q2 CY11 Q3 CY11 (FCST) Trend USA/Canada 2322 22-23 Stable Mexico 24232423-25 Stable E. Europe 50485050+ Relatively Stable SE Asia 34323638-40 Lengthening due to uptick China 48 4645-46 Stable India ND >90 Very Hard to Measure ODM Mexico 42404240-42 Stable E. Europe62606466-68Lengthening due to uptick SE Asia 42404852-56 Lengthening due to uptick China 8078 ~80 Stable India ~88<8886>90 Very Hard to Measure Solution Cycle by EMS Type Note: Average lead-time, in calendar days from order release (with prior FCST) to FOB suppliers dock.

6. © Charlie Barnhart & Associates LLC Insights into the world of global electronics manufacturing Industry Insights 6 The cost of labor has increased in most geographies over the 1 st half of CY2011 due to currency translation and wage rates inflationary pressures. The largest of these increases were in the Euro and Non-Euro regions of Eastern Europe and China. Net of strengthening of the USD$ the burdened cost of labor in the 2 nd half of CY2011 (on new business) is expected to be: slightly higher in Mexico (~1%), much higher in China (>5%), and extremely variable in Eastern Europe while remaining generally flat elsewhere.

7. © Charlie Barnhart & Associates LLC Insights into the world of global electronics manufacturing Industry Insights 7 The cost of manufacturing in China has also increased as a result of escalating Corporate Costs… “CCs have hovered around 4-5% in the EMS sector while in the ODM sector these costs have climbed from less than 2% to almost 5%. Even more dramatic, in the indigenous Chinese National industry these costs have escalated from <1% to well over 4%” Corporate Costs by Supply Type (% of Selling Price) Corporate Costs Q1CY11 Act. Q2CY11 Act. Q3CY11 (FCST) Longer Term Trend EMS3.95% 4.0%4.1-4.3%Up slightly ODM4.12% 4.2%4.5-4.7%Up significantly (~5.5%) JDM5.38% 5.5% Flat to up slightly OEM to OEM8.05% 8.75%8.75-9%Up slightly China National4.0% 4.2%4.5-4.75%Up significantly (~5.5%) Note: These value are net of the new Provincial Taxes that are now being applied in China.

8. © Charlie Barnhart & Associates LLC Insights into the world of global electronics manufacturing Industry Insights 8 Exacerbating these increases is an ongoing trend of escalating Mark-up% expectation by the Chinese National Supply base and Taiwanese ODMs… Average Mark-up% by Sector/ODM M$ USD1-5 5- 10 10- 25 25- 50 50- 100 100- 250 250- 500 500- 750 750- 1B >1B Computing2928171311.588ND Communications2725191612.5107.57 ND ConsumerND 171412ND66.5ND Industrial (& Energy) ND 2218161388ND MedicalND 201715131211ND Mil/AeroND 1713ND AutomotiveND 252316ND Note: Since the beginning of CY2011 we have seen 2 increases for every 1 reduction by ODMs.

9. © Charlie Barnhart & Associates LLC Insights into the world of global electronics manufacturing EMS by Sector Q4 CY10 Q1 CY11 Q2 CY11 Trend Computing1.0 1.1Stable w/few exceptions Communications1.61.92.0Increased focus Consumer0.80.90.8Varies by product Industrial (& Energy)6.16.26.4Serious focus Medical6.46.36.8#1 Priority all tiers Mil/Aero3.22.61.6Being very cautious Automotiveo.91.01.6Improving ODM by Sector Computing4.64.54.7Still #1 priority all tiers Communications3.13.23.6Increased focus Consumer2.1 2.2Stable w/few exceptions Industrial (& Energy)2.02.13.4Increasing focus Medical2.3 2.2Increasing focus Mil/Aero0.1 NDMinimal activity globally Automotive1.82.12.4New push expected Industry Insights 9 The Mil/Aero sector has been a key market focus for domestic CMs but spending cuts are inevitable… Sector Pacing Ratio

10. © Charlie Barnhart & Associates LLC Insights into the world of global electronics manufacturing Industry Insights 10 The Composite Business Risk (CBR) has been indicating a consistently increasing level of risk in the Global Electronics Industry since CY2007. Risk has increased >45% in the past 4 years!

11. © Charlie Barnhart & Associates LLC Insights into the world of global electronics manufacturing Industry Insights 11 Why is risk going up? 1.Prices are down but costs are up 2.Fewer resources at OEMs worldwide 3.The demand cycle has shortened 4.Businesses are operating at higher velocities 5.Supply chain concentration in Asia 6.Loss of institutional continuity 7.Unpredictable/unstable capital markets 8.Geopolitical unrest & instability 9.Overtaxed infrastructure in low cost regions Note: The OIS and GRM of the ONS are being updated (to V12) to reflect this new reality!

12. © Charlie Barnhart & Associates LLC Insights into the world of global electronics manufacturing 12 Questions?