PowerOne PWER Investor Presentation

1
Power-One (PWER)Investor Presentation
March 2007
2
Mission Statement

• To be recognized as the leader in system-level
  power and power management solutions from AC to
  the IC in the communications and high-technology
  markets, utilizing our technical leadership to
  deliver comprehensive low-cost solutions
  providing increasing value to customers,
  employees, and investors

3
Power-One Power Supplies Are Everywhere
Our products convert, process purify
electricity to the high levels of quality,
reliability, precise direct current required by
the digital economy

• Over 25 million power supplies shipped now
  SILICON

4
Power Conversion Products for Communications
High-technology Infrastructure Markets
AC/DC Power Powers Telecom, Networking
Industrial Equipment Controls Power at the
System Cabinet
DC/DC Power
Plus Digital Power Management Controls Power on
the Printed Circuit Board
5
Power-One Today

• 30 years of success
• One of the worlds top power supply companies
• Broad-line power conversion supplier 100s of
  standard product families
• Over 2,500 employees
• Top brand name quality reputation
• Industry leading Gross Margins
• Five acquisitions since 1999
• Highly-automated worldwide manufacturing
• Strong balance sheet (45M cash, 80M debt)
• 06 Sales 338M 29 Growth
• Investing 7M/yr in RD for silicon design

(Now 4000!)
(Now six!)
(530-550M in 07)
Today, Power-One is the technology leader in
power a consolidator and a developer of
silicon products
6
NEWS FLASH! Power-One Announced Acquisition of a
Power Conversion Company

• Power Electronics Group of Magnetek, Inc. for
  84M in late October 06
• Expected to increase revenue by over 50 with
  overall purchase price of only 0.5x forecasted
  2007 sales
• The acquisition is strategic and accretive
• Accretive in Q1 of 2007
• 90 of products are digitally based with
  micro/DSPs
• Synergies expected to be additive to earnings per
  share
• 0.07per share in 2007
• 0.30 per share in 2008
• Q4 07 exit rate Expect sales 150M and EPS
  0.10
• January 07 changes
• U.S. factory will be shutdown products moved to
  low cost areas
• Dr. Alex Levran joins Power-One as CTO from
  Magnetek

7
Overall Transaction Assets

• Three main factories
• 230K sq. ft. in Shenzen (Baoan) China
• 180K sq. ft. in Valdarno, Italy (Includes RD and
  Admin, with low-cost feeder plant in Hungary)
• 50K sq. ft. in Chatsworth, CA
• Best-in-class RD Center (80
  experienced engineers)
• Custom product capability
• New applications, like Alternative Energy (AE)
  digital control for motors
• High-volume purchasing leverage

Shenzhen, China
Valdarno, Italy
Chatsworth, California
8
Strategic Synergies Importance

• The acquisition is strategic and accretive
• Forecasting EPS in 2007 to be 0.20 per share
• Expect to exit 07 at a quarterly run-rate of a
  range around 150 million in sales and 0.10 EPS
• Primary drivers for margin improvement are
  synergies in purchasing and manufacturing
• Size and purchasing power of larger company
• Now the 7th largest power supply company in the
  world
• Economy-of-scale to compete with larger
  competitors
• High-volume, low-cost China operation
• Adds Custom products (largest fastest-growing
  market) and augments top customer base
• RD resources and technologies
• Alternative Energy initiative

9
Acquisition Highlights How Power Conversion
Power Management Are Changing to Digital

• Products range from smart motor driver and
  control circuits to large 50KW power modules
• 90 of products are digital implementations with
  micro/DSP and software
• Fewer competitors - less commoditization
• Higher margins over time
• Greater functionality - market diversity
• Higher performance
• Software-driven with reduced parts count higher
  reliability
• Augments Power-Ones board-level Z-One
  digital power management capabilities

DSP-based Motor Controls
Digital Smart Appliance Control Management
10
Alternative Energy Initiative In Power
InvertersUsing Digital Technology to Innovate

• Solar Wind Fuel Cells
• High reliability and efficiency power converters
• High power-density compact size
• Primary energy source control
• Grid interactive control
• System level control

Compact Fuel Cell Power Conditioners
Wind Power Converters
Photovoltaic Inverters
11
Quarterly Revenue
(M)
Q1 07 estimate range is between 125 to 135M
12
Power-Ones History Strategic Direction
Acquired PEG of MAG
Custom Products China Mfg.
Silicon Division
Silicon POLs 1st Power Mgt.
Acquired di/dt
High-density Bricks POLs
Silicon Initiative
Silicon RD Center Startup
Power Systems (Europe/Asia)
Power Systems (North America)
DC/DC Bricks (North America)
DC/DC Conversion (Europe)
AC/DC North America
1998 1999 2000 2001 2002
2003 2004 2005 2006
1997
1973
Strategic Direction
Entered Server/Storage markets acquired Custom
capability
A technology leader in powering communications.
Integrated five acquisitions, developed silicon
digital power mgt.
Strategic shift to communications infrastructure
markets acquisitions
Initial Public Offering (IPO)
Founded as AC/DC power conversion company
13
30 Years of Innovation in Power

• 1972 1st linear standard
• 1989 1st in configurable high power AC/DC
• 1993 1st DC/DC open frame converter
• 1995 1st dual ½ brick (DC/DC Converter)
• 1995 1st dual ¾ brick
• 1995 1st 50 Amp ¾ brick
• 1995 1st planar transformer
• 2000 1st 100 Amp AC/DC power supply in a 1U
  height
• 2001 1st 150 Amp ¾ brick
• 2001 1st Surface Mount ¼ brick
• 2002 1st 1/8th brick
• 2002 1st Surface Mount 1/8th brick
• 2002 1st triple-output scalable, sequenceable ½
  brick
• 2004 1st in digital power conversion (Z-One
  IBA)
• 2004 1st 97 efficient isolated DC/DC Converter
  
• 2005 1st 340W 1/8th DC/DC Brick Bus Converter
• 2006 1st to control both analog digital with
  Z-Series

14
Power-Ones New Global Footprint
Ireland
Slovakia
Andover, MA
Switzerland
Hungary
San Jose, CA
Italy
Chatsworth, CA
Baoan, Shenzhen, China
Camarillo, CA
Dallas, TX
Shekou, Shenzhen, China
Dominican Rep.
Carlsbad, CA
Penang, Malaysia
Singapore
Australia
Manufacturing Centers
NEW Mfg Centers
RD Centers
NEW RD Centers
15
Power-Ones Customers Acquisition Augments
Premier Customer Base
Bottom Row Shows Significant Additions to PWER
Base
16
Why Customers Select Power-One

• Comprehensive product selection
• Full range of options for power technology
  solutions. 100s of products to fit any
  application
• Designed-in technology solutions
• Vision-One process used to strengthen engineering
  relationships
• Newer technologies facilitate strong
  partnerships, especially on-board designs
• Reliable products at competitive prices
• Only 2-5 of system cost, but mission critical
  to performance
• Logistics and customer support
• Sophisticated Oracle ERP systems
• EDI links to customers
• Strong financial partner
• Excellent balance sheet
• Investing in infrastructure and RD

17
2005/2006 Major Restructuring/Sales Growth
2007 Integration Execution and Leverage

• 2005 Goal of profitability achieved in Q3 Q4
• Reduction of 30M in overhead SGA
• High-cost Norway functions moved to low-cost
  Slovakia China
• Telecom Power Systems combined with embedded
  business
• 2006 Return of Growth
• Return of sales growth was 1 goal
• Server Storage and Power Systems growth has
  been dramatic in 2006
• Original goal of 10-15 growth in 06 was at
  high-end without acquisition
• 2007 Executing the acquisition integration plan
• Acquisition will increase sales dramatically to
  530-550M
• Material costs and synergy are highest priority
  to improve profits
• Acquisition management teams are fully
  operational and motivated
• Shutdown Chatsworth, CA facility move products
  to low-cost areas
• Dr. Alex Levran joined as CTO in January 07

18
Core Business SuccessesPower Systems Telecom
Cell Base Station Backup Power

• Turned around our Telecom Systems Business to now
  one of the fastest growth lines in Power-One
• Seeing more new opportunities strong Bookings
  (esp. in Europe, Middle East, Russia).
• Datacom Telecom continue to converge there
  are many more new opportunities for rectifiers
  with existing OEMs
• Outdoor Cabinet for wireless that was developed
  in 06 is a new market for Power-One
• Gaining Market Share in Telecom Power Systems
• Supply Agreement with Ericsson announced in 2006
  is starting to generate sales

19
Core Business Successes Embedded Products
AC/DC Power Supplies

• More aggressive in custom products business
• Gained access to larger accounts in
  Storage/Server market
• Strategy standard platforms to develop customs,
  which lowers cost, risk, and time to develop
• Best distribution network Award from Arrow for
  largest sales of all products in the
  Electro-Mechanical (EM) category
• Good upside when ATE/Semi Equipment market
  improves
• New Product Introductions cement leadership, like
  the Best-in-Class, High-Density, Front-Ends (FNP
  Series of products)
• Penetrated two of the largest Server/Storage
  companies and working on others
• Supplier of the Year Award for ALL products
  from Xyratex
• Sun Computer Meritorious Achievement Award
  presented to Power-One. Only 17 companies were
  honored

20
Core Business Successes Embedded Products
DC/DC Converters

• Growing market share in our space
• World-class leadership
• One of the broadest DC/DC converter portfolios in
  the industry. We can control almost any
  application
• High-density bricks (latest example is 1/8th
  brick with 30A and best thermal performance in
  its class)
• Y POLs (standard analog) continuing to gain
  traction
• Using standard platforms for development of
  custom DC/DC bricks and POLs
• Reduced costs attained from moving U.S.
  manufacturing to Dominican Republic and Asia

21
Where Power-One Excels

• Worldwide Mfg. and RD (Asia, Americas Europe)
• Worldwide Customer Service and Support Including
  Field Applications, Sales Sophisticated IT
  Infrastructure (EDI)
• Technology
• In-house silicon development and packaging
  capabilities
• Digital Power Management, Z-One Digital IBA, the
  first complete power conversion AND power
  management solution
• Density leadership in DC-DC bricks and POLs
• Leadership in AC Front Ends and Telecom Power
  Systems
• Industrys highest efficiency and power density
• Competitive on a world class level
• We are a complete supplier from AC to the IC

22
Market Drivers Power-Ones Competitive Position
Global Market Trends
The Power-One Advantage
Vendor Consolidation Customers Demand Strong
Balance Sheet Global Operations.

• Leading Technology from Silicon to Systems
• Broad Product Line Standard Custom
• Leading Brand Top Quality Support
• Proven Consolidation Capabilities
• Global Blend of Outsourcing
  Vertical Mfg.
• Few Competitors Can Compete at Larger Customers.
  (Top Customers dominate TAM)

Product Choices Both Standard Custom. Silicon
to Systems offer One-Stop-Shop
DPA ? IBA ?Digital Distributed Pwr. Arch. Is
Moving to Intermediate Bus Arch. Digital Pwr.
Mgt.
23
Growth Opportunities

• NEW OPPORTUNITIES
• New Markets
• New Products
• Digital Power

• CORE GROWTH
• Technology Leadership
• High Density/Efficiency
• Broad Product Portfolio

Communications Industrial Markets
Server StorageMarkets
Standard Products
Custom Products
Power Systems(Indoor)
Power Systems(Outdoor Access)
AC/DC Power Supplies
AC/DC Front-ends
DC/DC Bricks
Analog POLs
Z-One Digital Power-Digital POLs-Digital Power
Mgt.
Acquisitions
24
Digital Power Revolution--- ZZZZ
A Digital Power Revolution
Conversion Communications Control
25
What Do Customers Want and Why The Inflection
Point Now..

• More and more lower voltages are needed by our
  customers
• Number of outputs are increasing
• Power management functions are escalating, as are
  of components
• Power takes too much space costs too much
• Power is getting more complex integration has
  been non-existent

26
Power Management and Power ConversionTwo
Separate Markets
Control (Pwr. Mgt.)
Conversion
Communication?
27
Power Management and Power Conversion Becomes One
with Digital Technology
Conversion
Communication
Control (Pwr. Mgt.)
Goal 20 Market Share in 5 Years
28
The Z Strategy Opportunity Win by Changing
the Rules of the Game

• Our Goal Comprehensively solve our customers
  power management problems
• Be first to market and gain share
• Establish leadership position with a new
  approach to power management
• Silicon strategy IP for higher margins and
  sustainable competitive advantage
• Attack new markets with disruptive technology

29
The Before Unmanageable with Analog
Analog Controller
48 V
Intermediate Bus Voltage (12V)
BRICK DC/DC Converter
POL
POL
POL
V6
V5
V7
30
The After Z-One DIGITAL IBA
Intermediate Bus Voltage (12V)
I2C from Host System
31
8-output Power System Comparison
BREAKTHROUGH
9
200
600
3.8 in2
10 in2
3 Days
8 Weeks
90
100
Virtually Unlimited
Limited
32
Z-One Architecture Benefits of Z-7000

• Any voltage, any current, any configuration
  architecture is highly adaptive flexible
  system reconfiguration on-the-fly
• Real-time telemetry continually monitors
  temperature, current, and voltage for precise and
  optimized control
• Open architecture communications with
  industry-standard I2C interface bus and affiliate
  program with BOTH module mfg. and silicon
  partners
• More reliable and flexible fault management
  strategies
• 90 reduction in time to market, development,
  of components board traces

Z-Series Digital Power Manager
Z-Point Of Load Converters
33
And Now Power Management for Free with No-bus
Z-1000 POLs

• NO bus, NO protocol, NO memory, NO software and
  NO programming are required
• NO external controllers are needed
• Power management features are inherent in
  Power-One developed silicon
• Based upon proven Z silicon technology
• Lower price point for No-Bus Z-1000 Series
  allows entry into lower-end applications.
  Simple, yet fully featured
• No other POL on the market has near the
  performance
• Configurable output voltages from 0.5 to 5.5v
• Manage sequencing with configurable delays,
  tracking and cascading between multiple outputs
• Can measure output current and temperature via
  monitoring pins
• Parallel up to ten Z-POL converters

34
The No-Bus Z-1000Power Management for Free
Intermediate Bus Voltage (12V)
35
Free Power Management Features Comparison -
Modules
Note If Analog Power Management Is Used by
Customer, 5-15 of Analog Components Would be
Required
Lynx is a trademark of Tyco Electronics Power
Systems, Inc
36
No-Bus Z-1000 Digital Power Advertisement
37
Choices in Cost and Functions
38
2nd Generation Digital Power Manager ZM7300

• One IC replaces entire module
• (1/6th the footprint)
• Increased functionality
• Controls non-Z converters, e.g., fans, VRMs
• Four non-Z-One devices can be controlled and
  monitored
• Monitoring enable lines synchronized with
  Z-POLs
• Industry standard 100khz and 400khz I2C comm. bus
• Supports hot-swapping of circuit boards

39
ZM7300 Now Control Non-Z Converters!

• Four enable lines synchronized with Z-POLs
• Four power good inputs for monitoring of non-Z
  Devices
• Can control any converter or other device with
  enable signal (e.g., fan)
• Enable turn-on/off delays and polarity are
  programmable via GUI

40
Z-One Digital (IBA) Outperforms Is Less Costly
POL Market is 1B with 15 Growth
Analog IBA
Cost
2nd Gen Digital Power Controls Analog
Full-Featured Digital Power Z-7000
Competitive Std. POLs (No Pwr. Mgt.)
No-bus Digital Power Mgt. Z-1000 POLs
Discrete Analog Solutions (No Pwr. Mgt.)
Performance
41
Results for Z-One Digital Power

• We have a significant head-start on the
  competition
• The Z-series disruptive architecture is a true
  revolution in power
• Licensed technology (second sourcing)
• Module 2nd source in Dec. 04 with CD
  Technologies (top 5 supplier)
• Semiconductor Z-affiliate announced with Atmel in
  July05 and with Micrel LDO (Low Drop-Out)
  regulator IC in Sept 06
• Silicon Labs joined the Z-Alliance in August 06
• Meeting with other potential partners
• Customers who implement the Z can offer
  products with additional system features and
  benefits and with faster TTM (time to market)
• New markets opened, e.g., Storage Server,
  Military, Aerospace Security (total POL market
  exceeds 1.0 billion)
• Core business is growing as a result of the Z
• 80 Z-One board-level design wins growing (now
  with top-tier cust.)
• Significantly more embedded in the customers
  systems architecture

42
Strategic Initiatives

• Execute on acquisition implementation
• Invest in most advanced power technologies
• Silicon-based products Protect IP
• Leading position in DC/DC bricks new POL
  converters
• Advanced AC/DC front-ends for DPA/IBA markets
• High-density Power Systems for telecom/ISP/infrast
  ructure
• Alternative Energy initiative
• Broaden portfolio into high-end data
  infrastructure
• Gain further traction in Storage/Server markets
  with the Z
• Custom AC/DC power supplies DC/DC converters
• New Telecom Power Systems outdoor cabinet
• Continue to reduce overall cost structure
• Bottom and top-line growth

43
Summary Take-a-ways

• 2006 was a return to growth 2007 is a year of
  execution and leverage
• Telecom Power Systems is now a high-growth
  business
• Server Storage design wins have turned into
  revenue
• Z-One digital power management gaining momentum
• Power-One is a consolidator and can compete with
  biggest competitors now 7 in worldwide sales.
• Power-One is the only significant Pure Power
  play
• High synergistic strategic value in
  acquisition very quickly accretive
• Power-One forecasts Q1 07 range to be between
  125-135M with acquisition, 530-550M in 2007
• Forecasting EPS in 2007 to be approximately 0.20
  per share
• Expect to exit 07 at a quarterly run-rate of a
  range around 150M in sales and 0.10 EPS

44
Z- Digital Power Revolution
A Digital Power Revolution
Changing the Shape of Power
45
Thank You!
46
Disclaimer Forward Looking Statements
This presentation includes forward-looking
statements within the meaning of the Safe Harbor
provisions of the Private Securities Litigation
Reform Act of 1995 that can be identified by the
use of forward-looking words such as will or
estimate or comparable words. These statements
are subject to a number of factors, risks and
uncertainties that could cause actual results to
differ materially from those projected. Risks
and uncertainties include, but are not
necessarily limited to the Companys success in
securing customer acceptance and adoption of the
Companys products and technologies the
Companys success in integrating the newly
acquired Magnetek PEG operations into the
Companys overall operations the Companys
success in achieving anticipated cost savings
from projected synergies relating to the Magnetek
PEG acquisition the size and pace of growth and
improvement in target and potential markets the
Companys success in establishing and maintaining
adequate and qualified manufacturing sources for
supply of products constraints and limitations
in the supply chain(s) for critical components
contained in Company products the Companys
ability to achieve and sustain gross margins at
levels anticipated and noted as comparable to
silicon-based companies the Companys ability
to continue spending at prior or desired levels
for research and development related to the
products and technologies discussed in this
presentation competitor advances and successes
in comparable, alternative or competing
technologies the Companys success in securing
protection for intellectual property incorporated
into the Companys products and/or enforcing such
intellectual property against use of same by
competitors intellectual property claims or
rights of third parties which are unknown to the
Company, and/or which are asserted in the future
against the Company. In addition, we refer you
to the Companys most recent SEC financial
filings, to include the Companys report(s) filed
with the SEC on Form 10-K and/or 10-Q for
disclosure and discussion, where applicable or
additional risk factors.