ADT Investor Day Presentation 2013

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© 2013 ADT LLC dba ADT Security Services. All rights reserved.

The ADT Corporation

INVESTOR DAY PRESENTATION

DECEMBER 6, 2013


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Our reports, filings, and other public announcements may include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the

Securities Exchange Act of 1934, as amended. These forward-looking statements relate to anticipated financial performance, management’s plans and objectives for future operations, business prospects,

outcome of regulatory proceedings, market conditions and other matters. We make these forward-looking statements in reliance on the safe harbor protections provided under the Private Securities

Litigation Reform Act of 1995. All statements, other than statements of historical facts, included in this presentation that address activities, events or developments that we expect, believe or anticipate will

exist or may occur in the future, are forward-looking statements. Forward-looking statements can be identified by various words such as “expects,” “intends,” “will,” “anticipates,” “believes,” “confident,”

“continue,” “propose,” “seeks,” “could,” “may,” “should,” “estimates,” “forecasts,” “might,” “goals,” “objectives,” “targets,” “planned,” “projects,” and similar expressions. These forward-looking statements

are based on management’s current beliefs and assumptions and on information currently available to management that are subject to risks and uncertainties, many of which are outside of our control,

and could cause future events or results to be materially different from those stated or implied in this presentation. Specific factors that could cause actual results to differ from results contemplated by

forward-looking statements include, among others, the following:

• competition in the markets we serve, including new entrants in these markets;

• entry of potential competitors upon the expiration of non-competition agreements;

• unauthorized use of our brand name;

• risks associated with ownership of the ADT® brand name outside of the United States and Canada by Tyco International Ltd., our former parent company (“Tyco”);

• failure to enforce our intellectual property rights;

• allegations that we have infringed the intellectual property rights of third parties;

• failure to maintain the security of our information and technology networks;

• interruption to our monitoring facilities;

• an increase in the rate of customer attrition;

• downturns in the housing market and consumer discretionary income;

• our ability to develop or acquire new technology;

• changes in U.S. and non-U.S. governmental laws and regulations;

• increase in government regulation of telemarketing, e-mail marketing and other marketing upon cost and growth of our business;• risks associated with our non-compete and non-solicit arrangements with Tyco;

• shifts in consumers’ choice of, or telecommunication providers’ support for, telecommunication services and equipment;

• our dependence on certain software technology that we license from third parties;

• failure or interruption in products or services of third-party providers;

• our greater exposure to liability for employee acts or omissions or system failures;

• interference with our customers’ access to some of our products and services through the Internet by broadband service providers;

• potential impairment of our deferred tax assets;

• risks associated with acquiring and integrating customer accounts;

• potential loss of authorized dealers and affinity marketing relationships;

• failure to realize expected benefits from acquisitions;

• risks associated with pursuing business opportunities that diverge from our current business model;

• adverse developments in our relationship with our employees;

• potential liabilities for obligations of The Brink’s Company under the Coal Act;

• changes in our credit ratings;

• risks related to our increased indebtedness;

• capital market conditions, including availability of funding sources;

• potential liabilities for legacy obligations relating to the separation from Tyco;

• failure to fully realize expected benefits from the separation from Tyco; and

• difficulty in operating as an independent public company separate from Tyco.

Given the risk factors and uncertainties that could cause our actual results to differ materially from those contained in any forward-looking statement, we caution investors not to unduly rely on our forward-

looking statements. These risk factors should not be construed as exhaustive. We disclaim any obligations to and do not intend to update the above list or to announce publicly the result of any revisions

to any of the forward-looking statements to reflect future events or developments. If one or more of these risks or uncertainties materialize or if our underlying assumptions prove to be incorrect, actual

results may vary materially from what we projected, including the market prices of our common stock during the term and after the completion of the accelerated share repurchase, the ability of the broker

selected by us to buy or borrow shares of our common stock, the ability to complete the share repurchases within the proposed timing or at all, the number of shares that ultimately will be repurchased, and

the uncertainty regarding the amount and timing of future share repurchases by ADT and the origin of funds used for such repurchases. Consequently, actual events and results may vary significantly from

those included in or contemplated or implied by our forward-looking statements. More detailed information about these and other factors is set forth in ADT's most recent annual report on Form 10-K, ourquarterly reports on Form 10-Q and in other subsequent filings with the U.S. Securities and Exchange Commission.

Forward Looking Statements/Safe Harbor


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Naren Gursahaney

Chief Executive Officer

Michael Geltzeiler Chief Financial Officer

Don Boerema Senior Vice President and

Chief Corporate Development Officer

Luis Orbegoso

President, Small Business

Alan Ferber

President, Residential

Introduction


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Agenda

Business Overview

Year One Progress and FY14 Outlook

Growing Our Business

Residential Security and Automation

Small Business Security and Automation

PERS/Health

M&A and Other Adjacencies

Financial Overview and Cost Efficiency Program

Concluding Remarks

Q&A


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What We Are Excited to Share About ADT Today


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Leading Player in Residential and Small Business

Security and Automation Markets

Leading Player in Residential and Small Business Security & Automation Markets

Large, Resilient and Growing Industry with Strong Growth Outlook

ADT Has Clear Competitive Advantages:

Leading Brand

National and Local Scale for Sales, Service and Monitoring

Standard-setting Technology, Products and Services

Unique Multi-Channel Sales Network

Consistent Mid-Single Digit Revenue Growth, Industry-leading Profit Margins and Customer

Return Metrics that Drive Cash Flow Generation and Shareholder Returns

1

2

3


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Leading Player in Residential and Small Business

Security and Automation Markets

92% of RMR 8% of RMR

Market Size

Market Penetration

Market Growth

Residential

Security & Automation

Small Business Security &

Automation

$11.0 Billion $2.4 Billion

4%-5% 3%-4%

19% 50%

13%

1

Market Share

Rank in Market

Contribution

25%

1

Source: ADT Segmentation Study; ADT Penetration Study; IMS Americas Market for Remote Monitoring Services.

Note: Markets include US and Canadian monitoring & services and installation/equipment revenues, unless otherwise noted.(1) Monitoring & services only, based on Bain HS&A national consumer survey estimate of household growth, 80% driven by automation services with premium RPU.

(2) IMS Americas Market for Remote Monitoring Services , US and Canadian monitoring and services revenue growth.

(3) Bain HS&A national consumer survey, based on number of subscribers.

(1) (2)

(3)


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$14.4$14.5

$15.9 $16.3$17.2

$18.0$19.4

2006 2007 2008 2009 2010 2011 2012

Residential Small Business Commercial & Other

Large, Growing and Resilient Market

Continuous growth throughout

market downturns

(1) Barnes Industry & Market Overview. Residential and Small Business data based on IMS Americas Market for Remote Monitoring Services.

(2) Monitoring & services only, based on Bain HS&A national consumer survey estimate of household growth, 80% driven by automation services with premium RPU.(3) IMS Americas Market for Remote Monitoring Services, US and Canadian monitoring and services revenue growth.

(4) ADT Segmentation Study; ADT Penetration Study; IMS Americas Market for Remote Monitoring Services; Bain analysis. Addressable market includes monitoring & services and

installation/equipment revenues for residential, fire, small and medium businesses in the US and Canada. Non-compete provisions with Tyco expire on September 29, 2014.

US Monitoring & Services Revenue ($ in Billions) (1)

4% - 5%

Residential

Security and Automation

Annual Growth

(2)

3% - 4%

Small Business

Security and Automation

Annual Growth

(3)

Consistent Historical Growth

Strong Growth

Outlook

21B total ADT addressable market once non-compete expires in September 2014

(4)


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Clear Market Leader with Competitive Advantages

6x

size of our next largest competitor

25%

4%

4%

3%

2%

2%


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13%

14%

20%

23%

88%

Telco 2

Telco 1

Cable 1

Traditional 1

ADT Has Leading Brand Awareness

~90% Brand Awareness

Among Consumers

(1)

Most Considered by

Consumers When Choosing

Their Security Provider

(1)(2)

50% of ADT Customers Did

Not Consider Any Other

Competitor During Their

Purchase Process

(3)

3%

5%

5%

6%

41%

Telco 2

Traditional 2

Traditional 1

Cable 1

4%

4%

7%

8%

50%

Traditional 1

Telco 2

Cable 1

All Others

I did not consider

any other

companies

(1) Bain HS&A national consumer survey (N=1,461).

(2) Companies considered by


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National / Local Scale in Sales, Service, and Monitoring

• Monitoring Centers

> 50k customers

10k-50k customers

< 10k customers

Established and trusted across

North America

Lower marketing and sales costs

per subscriber relative to main

competitors

National Scale

Reduces Sales

and Marketing

Costs

High regional density reduces

monitoring and service costs

Lower cost to serve per

subscriber relative to main

competitors

Local Scale

Reduces Cost to

Serve

Leverage scale to enhance

Pulse upgrade campaigns

Enables more robust

technological innovation

Platform for partnering and M&A

Other Scale-

Driven

Advantages

Unparalleled Scale of

Over

6.5 Million

Customers

Proven Scale Benefits


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Connections

Automation and scheduling

Alerts

Savings from consumption

management and rate

reductions

Energy

The foundation and heritage of

ADT’s offer

Life Safety

Media integration and control

Real-time content

Lifestyle

Entertainment

Standard-Setting Technology, Products and Services

Comprehensive Safety

and Automation

Product Solutions

Obsession with

Protection

Industry-Leading

Innovation

Superior Customer

Experience

n

e

r

g

E

e

a

nm

e

Lifestyle

Life Safety

Smart

Meter


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Video: Our Greatest Advantage

Average tenure of sales representatives

3 years

Average tenure of call center representatives

4 years

Average tenure of service technicians

11 years

Average tenure of install technicians

7 years

17,000 Employees

who are Security Experts


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Multi-Channel Model Provides Unique Advantages

Indirect

ResidentialNational Sales

Center (NSC)

HealthSmall Business

(SB)

Broad network of 3,900 sales

professionals and 4,300

installation and service

technicians

Largest dealer network in North

America consisting of ~350

authorized third-party dealers

Strategic sales partners

Complementary customer segments, marketing channels, geographies and promotional strategies

Efficient use of overflow capacity

Innovation driven by leveraging best practices and processes from ~350 potential sources

Insulates against volatility

Ability to leverage lower-cost channel at any point in time

M&A

Grow customer additions

through acquisitions

Proven history of integration

capabilities

3rd-Party (Lead &

Sales Providers)

Authorized Dealers

Affinity

(Lead Providers)

Builder / HOAs

(Lead Generators)

Direct

Large Bulk

Acquisitions


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5.0%

1.2%

3.6%

Cable/Telecom

0.2%

3.9%

1.4%

FY2013

LTM Attrition

Lost to

Competition

Relocation

Non-Pay

Voluntary

excl. Lost to

Competition

Lost to

Competition

New Entrants Highlight Attractiveness of Industry

While ADT Continues to Win

Subscribers Lost to Cable / Telecom Account

for Only 0.2% of Customer Base

ADT Winning Consistent Share of New

Customers Despite New Entrants

46% 48% 44%

16%

25%

49%15%10%

3%

23%18%

4%

Past 12M 1-3 Years >3 Years

ADT Other Security Firms Cable/Satellite Telecom

Share of Total Subscribers by Installation Date (1)

Other

Competitors

ADT

Stability

(1) AlphaWise, Morgan Stanley Research, Survey of US Residential Security Market (2013, N=1,192).

(2) Based on July 2013 internal survey results.

(2)

13.9% 1.4%


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$1.8

$2.3

$3.0

43.8%47.5%

51.1%

$0

$1

$1

$2

$2

$3

$3

$4

$4

2007 2010 2013Recurring Revenue EBITDA Margin

Favorable Market Dynamics and Competitive

Advantages Drive Financial Performance

Strong Recurring Revenue Growth

Attractive Account Growth Opportunities

Consistent ~ 1 billion of steady-state free cash flow generated every year

(1) Pro-forma acquisition of Broadview Security in 2010.

(2) EBITDA is before special items and is a non-GAAP measure. For a reconciliation to the most comparable GAAP measures please see the Appendix.

(3) IRR is calculated on a 15-year after tax. basis

(2)

Dealer

Resi. Direct -Pulse

Resi. Direct – Trad.

Total Resi.Direct

SB - Pulse

SB – Trad.

Health

Devcon

Large BulkPurchase

0

200

400

600

5% 10% 15% 20%

IRR (3)

F Y 2 0 1 3 C u s t o m e r

A d d i t i o n s ( 0 0 0 s )

Weighted

Average Cost

of Capital

Customer IRRs well

above weighted

average cost of capital


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Agenda

Business Overview





PERS/Health



Concluding Remarks

Q&A


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Significant Progress Made In 2013, First Year as a

Public Company

Enhanced

Management

Team

Built

Momentum in

Pulse

Small

Business

Growth

Successful

M&A

Execution

More than doubled recurring revenue growth in FY2013

Accelerated Pulse take rates to 34% in Q4

Expanded security solutions offerings and cross-selling capabilities

Devcon added 117k customers with attractive retention profile Further strengthened self-generated sales via Absolute acquisition

Added 34k accounts via bulk purchase

Rolled out Pulse across all channels

32% Pulse take rate in Q4 resulting in 26% Pulse take rate for FY 2013

Continuing to expand capabilities and enhance customer experience

Mike Geltzeiler

Chief Financial

Officer

>30 years of public

company finance

leadership

experience

Alan Ferber

President,

Residential

Track record of

improving customer

retention in

subscriber business

Luis J. Orbegoso

President, Small

Business

Deep security

industry expertise in

commercial markets

Kathleen McLean

Chief Information

Officer

Broad information

technology and

operating

experience in

telecom market

Arthur Orduña

Chief Innovation

Officer

Emerging technology

and product

management

experience in cable

industry

Returned

1.4B of

Capital

1.3 billion in share repurchases and 112 million in dividends

Committed to additional $1.2B of share repurchases and dividend increase

subsequent to close of fiscal year


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Connecting Key Operating Levers and Financial

Metrics to Drive Total Shareholder Return

Customer Additions

Average Revenue Per

User (ARPU)

Cost to Serve

(CTS)

Attrition

Subscriber Acquisition

Cost (SAC)

Capital Structure &

Share Repurchases

M&A

Pre-SAC

EBITDA Margin

EBITDA Margin

Steady-State Free

Cash Flow

EPS using Cash

Tax Rate

Cash Tax Rate

Recurring

Revenue

Key Levers

Financial Metrics


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Adding Over 1 Million Customers Per Year

Customer Additions

Direct Channel Growth Accelerating with

Housing Recovery

Unique Multi-Channel Approach Boosts

Customer Additions

157

161163

173

Q1 2013 Q2 2013 Q3 2013 Q4 2013

Y-o-Y

Growth(1.3%) 0.6% 4.5% 8.1%

507 566597 634 654

464459

491 527 453

117

9711,025

1,0881,161

1,224

2009 2010 2011 2012 2013

Gross Direct Additions

Gross Dealer Additions and Bulk PurchasesTuck-In Acquisitions

(Thousand Customers)

(Thousand Customers)

2013 Direct Additions


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13.9%13.5%

12.2%

13.0%

12.6%

Net Attrition asReported

Net Attrition on a UnitBasis

Net AttritionAdj. for

Recaptures

Vivint Monitronics

Industry-Leading Customer Retention,

Committed to Further Improvements

Attrition

(1) T12M RMR of canceled subscribers divided by the T12M average total RMR. Net of dealer chargebacks (replacements contractually provided by dealers) and resale units (new subscribers

at a location with previously installed ADT system).

(2) T12M number of canceled subscribers divided by the T12M average number of subscribers, net of dealer chargebacks and resale units.(3) Net of relocated customers who re-enter contract with ADT at new location.

(4) Vivint investor presentation, as of September 30, 2013.

(5) Monitronics filings, as of June 30, 2013.

Y-o-Y +40bps +30 bps N/A +330bps +60 bps

(2)(3)

(4) (5)

~170 bps lower on a unit basis and

excluding customers that moved and re-signed

with ADT: most comparable to peers

LTM Net Attrition is More Stable than Peers

(2)(1)


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Consistent Growth in Revenue Per User

ARPU

$42.99$43.36

$43.94$44.20 $44.24

$38.87$39.27

$39.66$40.08 $40.31

Q42012

Q12013

Q22013

Q32013

Q42013

New Customers RPUAverage RPU All Customers

4.6%

3.7%

Pulse Adds Driving Higher RPU

RPU of Pulse customers is 25% higher than non-Pulse customers

Regular Price Increases

2.8%

3.1%

2.8%2.7%

2.8%

Q42012

Q12013

Q22013

Q32013

Q42013

(% of trailing 12 months recurring revenue)

Price Escalations

FY2013

YoY


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$1,187

$1,251 $1,245

$1,294$1,322

$10

$22 $32

$32$32

$1,197

$1,273 $1,277

$1,326$1,354

28.2x

28.8x

28.3x

29.3x29.9x

FY 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013

Net Subscriber Acquisition Cost Upgrade Cost Net Creation Multiple

Majority of SAC Increase Driven by Pulse Adoption

SAC

(1) Excludes upgrade costs associated with traditional customers upgrading to Pulse service. Estimated cost of $750-$800 per subscriber upgrade.

Increase in SAC Partially Offset by Higher ARPU of New Customers - Modest Increase in Net

Creation Multiple Reflects More Valuable Pulse Customers

(1)

($ / Customer Addition)


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High local density of subscribers leading to

high economies of scale for monitoring and

customer service $14

$18

FY2013 Monitronics Vivint

$13

Leveraging Scale for ADT Cost Advantage

Cost to Serve is Lower than Peers

(Cost to Serve per Customer per Month)

Cost to Serve

(1) Estimated based on Monitronics public filings as of September 30, 2013.

(2) Estimated based on Vivint public filings and press releases as of September 30, 2013, based on YTD 2013 figures, adjusted for transaction costs.

(1) (2)

Multiple Sources of Scale Advantage Driving

Down Costs

Large and diverse customer base reducing

concentration risk of bad debt

Synergies from acquisitions as a result ofintegrating operations and capabilities


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Strategy in Place to Drive Growth and Margin

Expansion in FY2014

Customer Additions Attrition ARPU

SAC Cost to Serve

Continued penetration

in Residential

Dealer channel

optimization

Expansion in Small

Business and Health Successful M&A

execution

Increasing Pulse take

rates to drive higher

ARPU

Consistent price

escalations

New initiatives and

Pulse will help offset

the impact of the

housing recovery

Impact of Pulse take

rates offset by

initiatives to reduce

cost, holding creation

multiple relatively

constant

Programmatic G&A

reduction

Initiatives in place to

streamline processes

and reduce cost

Comment Outlook Comment Outlook Comment Outlook

Comment OutlookComment Outlook


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Strengths and Opportunities Driving ADT Priorities

ADT Priorities

Large, resilient and

growing industry

Advantaged position as

industry acquirer/partner

of choice

ADT well positioned to grow

as clear leader with

competitive advantages

Invest in

Growth

Optimize Cost

Structure

Balanced

Capital

Allocation

Accelerate innovation and enhance

leadership position in Residential

Optimize Dealer network and stabilize attrition

Expand presence in Small Business

Capture opportunities in Health

Leverage M&A to accelerate growth

Efficiency program focused on cost to serve

and subscriber acquisition cost

G&A reduction

Strengthen business platforms to support

efficiency improvements and growth

Optimized capital structure

Dividend growth

Strategic M&A

Opportunistic share repurchases

Favorable Environment


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Agenda

Business Overview





PERS/Health



Concluding Remarks

Q&A


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Leverage M&A to Further Grow Share

and Improve Economics

Accelerate Innovation and Capture

Opportunities in Residential Security and

Automation Business

Strengthen PERS Platform and

Capitalize on Health Opportunity

Expand Presence and Market Share

in Small and Medium Business Market

Attrition

Customer Adds

ARPU

Customer Adds

Cost to Serve

1 2

3 4


Customer Adds

ARPU

Customer Adds

ARPU


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Alan Ferber

–

President, Residential

Prior Experience

Former Chief Strategy and Brand Officer and

Executive Vice President – Operations at U.S.

Cellular Co-founded Traq Wireless

Earlier career positions with Ameritech

Corporation and First Chicago Corporation

Areas of Expertise

Education

20+ years in technology-based, consumer subscription services

(wireless)

Marketing, sales, operations and customer service expertise

Driving loyalty through customer-obsessed culture and differentiated

customer experience

MBA from Northwestern University's Kellogg

School of Management

Bachelor of Arts from the University of

Michigan


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Clear Path to Grow Residential Business

Focused efforts to stabilize attrition

Optimize Dealer channel and expand partner network

Significant room for increased penetration

Positive Industry

Momentum

Net Customer

Additions Growth

Leverage consumer insights to drive innovation

Invest in Pulse to drive ARPU and net customer additions

Automation Growth

Clear Path to Growing Net Customers and Recurring Revenue

Market growth expected to accelerate with housing recovery,

automation trend and technological innovation

Positive Industry Momentum


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Significant Room for Further Penetration

Market Penetration of Home Services (U.S.)

100%

83%75%

64%

19%

1%

Wireless Internet HDTV Landline Phone Security HomeAutomation

Source: Industry Journals; penetration of home security from ADT 2010 Penetration study and 2008 Parks Associates.

Opportunity to expand

market by 3x if

penetration reaches that

of other home services

Automation

Net Customer Additions



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US Housing Market (2)


Pace of Growth to Accelerate with

Housing Recovery

Key Macro Considerations Indicate


75%

of new ADT customers start monitoring

when they move into a new home(1)

4.2 4.0 4.14.5

4.9 5.15.5

2009 2010 2011 2012 2013E 2014E 2015E

(1) Per ADT customer survey response to question “why start monitoring?”; n=1440.

(2) National Association of Home Builders (September 2013).

(Units in Millions)

Existing Home Sales New Home Sales

Automation


Key Considerations Potential impact

Housing

Market

Technology

Development

Customer

Demand

Demographic Trends

Economy & Consumer

Confidence

Crime

Rates

Regulatory

Environment

Aggregate

Impact



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Home Automation Solutions to Drive Growth

20% of current security users have or

intend to purchase automation services

(1)

(1) Bain HS&A national consumer survey (N=1461).

(2) Bain HS&A national consumer survey, estimated growth from 2013E to 2018E.

45% of home security intenders also

intend to pursue automation service

(1)

Automation Expected to Drive 80% of Market Growth

80%

Home Security

and Automation

20%

Home

Security

2013E-2018E Expected Sources of Growth

(2)

Automation




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Well Positioned to Capture Growth in

Automation Services

Needed to Win in

Automation Market

ADT?

Leading Security Capabilities Leading Home Automation

Solutions Positive Customer Service

Performance Preferred Industry Partner

Status

National and Local Scale

Source: Barnes Associates; Bain HS&A national consumer survey (N=1461)

Current 8% Pulse penetration reflects

untapped potential within existing

customer base

Automation


Pulse adoption has just begun in Dealer

channel and is accelerating

Continued innovation will drive growth

and additional partnership opportunities



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Pulse Take Rates Continue to Increase

11%

27%

49%

54%

8%

19%

35%

39%

0% 1%

13%

23%

FY 2011 FY 2012 FY 2013 Q4 2013

Direct New Only(Excluding Devcon)

New and Resale(Including Devcon)

Dealer

(% of New Customer Adds)

Pulse Take Rates

Automation


Pulse Customers have 25% Higher ARPU and Better Retention Characteristics

11

27

48

54

8

19

35

0

1

13

(Excluding Devcon)



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Further Innovation Driven by Consumer

Insights and Quick to Market Approach

Expanding Solution Set Benefits

Shift from physical to

physical + digital security

Additional peripherals

Enhanced user interface

Shift from fixed / premise based to

mobile / personal security

Increased customer engagementto drive ARPU and loyalty

ADT Everywhere increasescompetitive differentiation

Big Data generates new

partnership and value creation

opportunities

Automation




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Dealer Channel Continues to Contribute

High Quality Customer Accounts

Automation


Consistent creation multiple

Increase in ARPU more than offset

slight increase in SAC

High credit quality customers

Average of 700+ credit score

Initiatives underway to drive FY2014

growth in Dealer customer additions

Historical Dealer Channel Customer Additions

Avg. New

Customer

Credit Score

714 715 718

(1) Cost to acquire a dealer sourced customer, net of chargebacks.

491K527K

453K

29.6x 29.5x 28.2x

$41.10$42.57

$44.61

2011 2012 2013

Gross Dealer Adds

Net Dealer Creation Multiple

Dealer New ARPU

(1)



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Strengthen and Optimize the Dealer Channel

Initiatives Underway to Support Dealer Channel

Improvement

Enhanced install, sales and Pulse training

“Business-in-a-Box” comprehensive

startup program

Training &

Nurturing

Reach 100% of our Dealers each year

with greater frequency for planning &

performance management

Business reviews with Top 50

Execute

“Reach

Frequency”

Additional sales support, managerial

oversight, realignments

New recruitment and development team

Staffing &

Operational

Support

Changes Among our

Largest Dealers

Pace of Pulse

Adoption

FY2013 Dealer

Dynamics

Termination of a

Major Third PartyLead Generator

Improved funding to drive Pulse adoption

Improved funding for existing dealers

New Dealer recruitment

Funding &

Incentives

Dealer

Rationalization

Automation




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Expanding Lead Sources, Distribution

Channels and Innovation Partners

Home Insurance

Strategic Technology Partners

Energy

Lead generation

Take advantage of uptick in

home construction rates

Early access to movers

Lead generation

Leverage broadband

infrastructure


Lead generation

Distribution opportunities

including peripherals

Lead generation

Mitigate insurance risks

Pulse / product integration

ADT Everywhere

Enable innovation

Lead generation


Pulse / product integration

Builders

Broadband

Retail

Automation




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Improve lifecyclemanagement

Drive Pulse adoption

Leverage data toincrease resales and

recaptures

Enhance attractivecustomer metrics

through tighter credit

screening

Voluntary Relocations Non-Pay

FY2012 FY2013

Initiatives to Drive Further Improvements in

Attrition and Mitigate Relocation Impact

-5bps

-15bps +60bps

40bps of Overall Increase in Attrition in FY2013 Driven by Relocations

40% of

Disconnects38% of

Disconnects34% of

Disconnects

36% of

Disconnects

27% ofDisconnects 26% ofDisconnects

Automation


Disconnect Units by Reason (U.S.)



42/102

41

Comprehensive View of Customer Lifecycles

Improves Customer Experience and Retention

Customer Life

Attrition Risks

Proactive

Customer Experience

& Retention

Programs to

Lengthen Lifecycle

Welcome /

On-Boarding

Non-Pay Risk Relocation Risk

eactive / Trigger-

Based Risk

Upgrade Campaignsuto-Pay Adoption

Resale & Recaptureoyalty / Save Desk

Characteristics of customers with long lifecycle:

Larger system installation / investment

Have more services and interaction with system

Use automated payment methods

Automation




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42

Higher Pulse Penetration to Improve

Customer Retention

0 6 12 18 2

Months After Installation

Pulse Customers

Non-Pulse Customers

Increase Pulse take-rates across all

channels

– New and upgrade promotions

– Targeted base marketing efforts

Leverage 2G—3G truck rolls

Focused pursuit to upgrade non-

converters

Continued innovation of Pulse to driveadoption

Pulse Customers Show Better Retention

Characteristics

Initiatives

Cumulative Residential Customer Attrition Rate (1)

After 24 months, residential

cumulative Pulse attrition is

30% lower vs. non-Pulse

attrition

(1) Estimated based on FY2011-2013 new customers.

Automation




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43

Resale

Recapture

NetRelocation

Disconnects

FY 13 Relocation Disconnects

Resale and Recapture Efforts to Mitigate

Impact of Relocations

Faster detection of potential relocations

and planned response through more

vigilant customer tracking processes

Increase sales capacity dedicated to

resale

Increase resales by leveraging all sales

channels and strengthening training

programs

Enhance centralized relocation desk

Relocation Disconnects vs.

Resale and Recapture

Initiatives

Automation


For every relocation

disconnect today, we

are generating ~0.5 customers through

new sales, our goal is

to generate 1.5 newsales per relocation

disconnect



45/102

44

6%

45%

94%

55%

New Sales Cumulative Non-Pay Attrition

8 Months After Sale

Customers who Fail Credit Screening

Customers who Pass Credit Screening

Implementing Enhanced Credit Screening to Lower

Attrition and Reduce Collection Costs

New enhanced screening leverages

internal credit criteria and third-party

credit models

– Customers who fail screen areasked to pay annual monitoring

fees up front

National rollout of Phase 1 screening

program has begun

– Final rollout targeted for Q2 FY2014

Revised customer credit screening will impact Direct channel gross additions in the

short term but provide a dramatic improvement in overall non-pay attrition over-time

National Rollout of New Enhanced

Screening Program

Non-Pay Attrition Predictability

Automation


6% of new sales representing 45% of non-pay

attrition by the 8th month

100% 100%


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45

Clear Path to Grow Residential Business

Capture fair share of overall market growth

Increase net customer additions

– Dealer channel optimization

– Targeted customer retention initiatives

– Increase partnerships

Invest in Pulse to capitalize on premium

ARPU and better retention characteristics

Assert market leadership position through

continued innovation

Customer Adds

ARPU

Attrition


47/102

46





Automation Business





Attrition

Customer Adds

ARPU

Customer Adds

Cost to Serve

1 2

3 4


Customer Adds

ARPU

Customer Adds

ARPU


48/102

47

Prior Experience

Former President of the Global Detection and

Alarm segment of United Technologies

Corporation (UTC)

Former President of Lenel Systems International,a division of UTC’s Fire and Security segment

Chief Marketing Officer of GE Equipment Services

10+ years at GE Healthcare in various

commercial leadership roles

Areas of Expertise

MBA from Northwestern University’s Kellogg

School of Management

B.S.M.E. from the University of Cincinnati

Education

Commercial and Enterprise Security products and services

Commercial and Enterprise Fire products and services

Software and Electrical products development and manufacturing

Sales, Marketing, Six Sigma, P&L leadership

Luis Orbegoso – President, Small Business


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48

ProfessionallyMonitored

security

Self-

Monitored /Unmonitored

Security

No Security

ADT

Protection1Vivint

Monitronics

All OtherPlayers

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Security Use Monitored Security

Market Size

Market Penetration

Market Growth

Market Share

Rank in Market

Contribution

Market Snapshot Competitive Landscape

Source: ADT Segmentation Study; ADT Penetration Study; IMS Americas Market for Remote Monitoring Services.

Note: Markets include US and Canadian monitor ing & services and installation/equipment revenues, unless otherwise noted.

(1) IMS Americas Market for Remote Monitoring Services, US and Canadian monitoring and services revenue growth.

(2) Bain HS&A national consumer survey, based on number of subscribers.

$2.4 Billion

3%-4%

50%

13%

1

(1)

8% of RMR

7.0M 3.5M

Growing Small Business Market with Further Upside

Number of Addressable Small Businesses(2)


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49

$209

$224

$231

$247

2010 2011 2012 2013

ADT Outpacing Small Business Market Growth

$2.2

$2.3 $2.3

$2.4

2010 2011 2012 2013

Growing Small Business Security Market ADT Has Outpaced Market Growth

(1) ADT Segmentation Study; ADT Penetration Study; IMS Americas Market for Remote Monitoring Services.

Recurring Revenue ($M) US and Canada Alarm Monitoring & Equip/Install Revenue (1)


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50

2.9%

6.9%

FY 12 FY 13

(1.0%)

7.8%

FY 12 FY 13

Increased Focus Has Accelerated ADT Share Gain

Region realignment

Forecasting tool

Revamped sales

processes

Increased

Level of

Accountability

Technology – Pulse

Optimizing media

Business Journals ads

Restaurant Stakeout

sponsorship

Small

Business-

Specific

Marketing

Salesforce.com

investment

1200 iPads for the field

Model sales call

Investment in

Field Tools and

Resources

Focused Initiatives

Recurring Revenue Growth (%)

ecurring Revenue Growth (%)

Subscriber Growth (%)

(1)

(1) Includes accounts acquired through Devcon acquisition.


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51

0 6 12 18 2

Months After Installation

Pulse Customers

Non-Pulse Customers

Pulse Customers Show Better Retention

Characteristics

Cumulative Small Business Customer Attrition Rate (1)

After 24 months, small

business cumulative Pulse

attrition is 40% lower vs.

non-Pulse attrition

(1) Estimated based on FY2011-2013 new customers.

(2) Includes Devcon.

Higher Pulse Penetration Will Benefit Attrition

Pulse Take Rates are Accelerating

0.6%

10.0%

27.6%

34.2%

FY2011 FY2012 FY2013 Q4 2013

Small Business Pulse Take Rates (2)

Small Business Pulse

customers have27%

higher ARPU

than

non-Pulse customers


53/102

52

Video: Small Business Solutions


54/102

53

Vertical

Examples

Retailers

Convenience

stores

Restaurants

Bars/grills

Doctor offices

Health clinics

Laboratories

Financial advisors

Tax preparers

Insurance agents

Auto service

stations

Small distributors

Needs

Employee theft

Shoplifting

Time andattendance

Monitor premises

Secure high value

inventory

Ensure food safety

Adhere to

regulatory policies Employee efficiency

Process

standardization

and control

Secure and

monitor drug

inventory Restricted areas

Compliance

Automated

reports (Audits)

Protect

confidential

information Selective

employee access

to sensitive areas

Digital security

Ensure customer/

employee safety

Restrict access tohazardous areas

Some have retail

components (gas

stations)

Market

Size

350M 375M 190M 400M 190M

Customer

Value

High Medium Very High High Medium

Products

Vertical-Specific Approach Will Accelerate Growth

Bundled security products that address specific needs by vertical

Store-Front Food & Beverage Clinical Office Mechanical

Source: Bain analysis; ADT Segmentation Study; IMS Americas Market for Remote Monitoring Services.


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Multi-location account organization: single

point of contact

Coverage augmented by 1,200 local reps

Our Capabilities Are Well Matched for Multi-Location

Accounts and Franchises

Consistent configurations, capabilities and

products

Pre-defined budgeting process/ROIStandardized Offerings

Multi-Location Accounts and

Franchises have Specific Needs

ADT has Unmatched Capabilities To

Serve These Accounts

Account Management

Nationwide coverage

200 Branches

4,300 techniciansConsistent and Reliable Support


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55

Growth Strategy for Small and Medium Business

Consists of Three Phases

Optimize

12-36 months

Secure

Next 12 months

Grow

36-60 Months

Provide insights and

management tools that

accelerate profit/margins

Leverage analytics that

can be easily monetized

― E.g. buying patterns,

demographics, social

marketing

Uniquely positioned to

offer technologies and

insights to small

businesses previously

afforded by only giant

retailers

Optimize customer

operations

― Focus on

operational cost

reduction

Integrate solutions into

Pulse to drive business

efficiencies

Technology and

commercial partnerships

Provide right solution set

Optimize field processes

with vertical-specific tools

and training

Vertical specific

marketing/brand

awareness

Pursue franchises and

multi-location accounts


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Growth Phase Store-Front Vertical Example

Real-time promotions

Advanced video analytics

Customer insight on efficiency of

promotions

Increased sales and margins

Business Owner Benefits

Attracting more customers

Sound investment decisions

Increased differentiation

Scaling effectively with growth

Effective marketing

Business Owner Challenges

Business Management Tools

that Drive Growth


58/102

57

Addressable Small and Medium Business Market (1)

Small

Business

Medium

Business

Fire

2.2

2.4

10.4

2010 2013 2016E

Addressable Market Opens Up Significantly After

Non-Compete Expires on September 29, 2014

4x

Current Addressable Market

After Tyco Non-Compete Ends

Small Business Market

defined as sites


59/102


60/102

59





Automation Business





Attrition

Customer Adds

ARPU

Customer Adds

Cost to Serve

1 2

3 4


Customer Adds

ARPU

Customer Adds

ARPU


61/102

60

Prior Experience

Former Chief Marketing Officer for ADT North

America-Residential and Commercial

President and Chief Operating Officer at FDN

Communications

Senior VP Strategy & Business Development and

Senior VP Business Marketing at AT&T Wireless

Former leadership roles held at Pepsi and McCaw

Cellular Communications

Areas of Expertise

MBA and B.S. from Eastern Illinois University

Education

20+ years of experience in technology-based, consumer subscription

services (wireless/telecom)

Strategy, business development, marketing, sales, and operations

expertise

Creating new businesses leveraging disruptive technologies

Building partnerships that deliver win-win results

Don Boerema– Chief Corporate Development Officer


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61

Philips

Life Alert

Alert 1

TunstallConnect America

Alert USA

Other

North America PERS Market

Significant Opportunity in PERS and Health Market

Source: Frost & Sullivan – Analysis of the NA Telehealth Industry; Parks Associates; SDM; ABI Research; Credit Suisse.

Personal Emergency Response Systems (PERS)

Market Expected to Grow 10% per Year

ADT Has Significant Opportunity to Grow

Market Share

1.9M

ADT has opportunity to grow Health revenue to > 100 million by 2016

2%

$1.0B$1.1B

$1.1B$1.2B

$1.3B

$1.5B

$1.7B

2010 2011 2012 2013E 2014E 2015E 2016E

North America PERS Revenue ($B) 2012 North America PERS Market (subscribers)

Market

Share

The Healthcare Environment and Demographic


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Trends are Favorable to Health Business

Rising Cost of Institutional Care

Aging Demographics

Affordable Care Act Conducive to Home-Based Health Development

Tremendous Opportunities in Insurance Reimbursement

New Technologies Continue to Enhance Value Proposition

ADT’s Potential Areas of Focus

User Device Data Transmission Data User /

Institutions

Hub


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63

Health Product Evolution and Customer Segment

Expansion Drive Long-Term Growth

POTS based PERS

Cellular enabled in-premise PERS

mPERS

Telehealth

Monitoring

Mobile

Monitoring

Seamless integration

PERS, automation, telehealth

Non-Emergency

mPERs

Shared functionality:

PERS, automation, telehealth

Horizon I:

Focus on Elderly

Horizon II:

Bundle for Purpose

Horizon III:

Integrate with Lifestyle

In-premise

only

Integrated

Health

solution

Expand into New Customer Segments

P

o

E

o

u

o

Telehealth-Driven Business

ERS-Driven Business

Example of DT’s Remote Care Products Providing


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64

Supportive Virtual Care at Home and On-the-Go

1

2

3

4

4

1

3

2

5

PERs

Motion sensors (Video)

Heart rate Monitoring

PERs

Motion sensors

Glucometer, Medication (box/cabinet)

Weight Scale Monitoring

PERs

Motion sensors, Video

Device on/off Sensors

Cabinet/Fridge door sensors Door/window sensors

PERs


Thermostat control

HR, BP, Glucometer Monitoring

Medication (box/cabinet) + reminders

Door/window sensors (front door sensor)

Door locks

TV access

PERs


Wake-up

Bathroom

Meals

Daily activity

Outdoors around

the house

5

6

6

MPERs

Mobile Health Tracking

Activity Monitoring and Alerts

Strengthen PERS Platform and Capitalize on Health


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Opportunity

Customer Adds

ARPU

Opportunity for double-digit growth in PERS and

Health market

Leverage significant growth trajectory in Health

market to gain share and expand product offerings

Continue to increase ARPU and expand customer

segments by integrating product functionalities into

Pulse ecosystem


67/102

66





Automation Business





Attrition

Customer Adds

ARPU Customer Adds

Customer Adds

Cost to Serve

1 2

3 4


Customer Adds

ARPU

ARPU


68/102

67

M&A Strategy Aligned with Business Strategy

Invest in

Adjacencies

Strengthen

the Core

Extend Our

Leadership Position

Bulk account

purchases

Dealer account

purchases

Strengthen functional

capabilities

Increase scale

Leverage synergies

Expand geographic

coverage

Pulse penetration

Small Business

Health

Other adjacencies

Examples

Broadview/Brinks

Devcon Security

iControl

Ideal Life

Pinnacle

Absolute

Changing Security Market Will Witness Increased


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68

M&A Activity Over the Next Few Years

Increasing competitiveness of home security market place by well capitalized public companies

Combination of above dynamics is leading private-equity owned competitors to consider sale

Interactive, internet-based technologies being deployed that drive complexity into business

Changing Market Factors

Evolution of the market makes this an attractive time for M&A

Sunset of 2G wireless network by January 2017 will place financial pressure on all players


70/102

69

ADT is Well Positioned as the Acquirer of Choice

25%

4%

4%

3%

2%

2%


71/102

70

Capabilities and Accelerate Organic Growth

Sales capabilities

Self-generating lead/door knocking

Fire-NICET/NFPA certification

Enterprise selling

Marketing capabilities

Data analytics

Mobile, social media, location based services

Installation

Other in-home services

Home entertainment

Service

Online customer self service

Billing

Technology

Intellectual Property

Extend our

Leadership

Position

Strengthen

functional

capabilities

Increase scale

Leverage synergies

Expand geographic

coverage

Devcon Acquisition

–

An Example of Our Disciplined


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71

Acquired Devcon on July 31, 2013 for 146M (1)

― $2.9M of RMR excluding Mutual and Stat-Land

― 41x 2013 RMR acquisition multiple

Run-rate synergies of 14M by FY2015

― Represents 34% of projected operating costs

― On track to achieve synergies

― One-time integration costs lower than plan

117,OOO high quality customers with low attrition

Efficient self-generating salesforce with lower SAC

Strong presence and operating model in the Homeowners

Association market

Overall business maintaining positive operating trajectory

― Sales force successfully integrated into ADT’s with rapid adoption of Pulse

Large commercial Mutual and Stat-Land business divested on

November 21, 2013 at a positive valuation

― 43x 2013 RMR

Extend our

Leadership

Position

Strengthen

functional

capabilities Increase scale

Leverage synergies

Expand geographic

coverage

Approach to M&A

(1) Net of cash acquired.


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72

Vehicle― Pulse integration with voice

management

― Asset management

Software and solutions― Location based services

― Video analytics― Intellectual Property

Data management and

analytics

― Identity Theft

Other Investment Opportunities

Invest in

Adjacencies

Pulse Extension

Business

Health

Other Adjacencies Hardware― Industrial Design

― Exclusive core elements

Entertainment

― Actionable local content

― Entertainment and Smart TV

integration

Monitoring

― Solar, vehicle, healthcare

Health 20% preferred ownership position

― Board seat Access to solution and platform

― Rights worldwide

― Integration with Pulse

Pre-determined rights to expand

ownership position― Timing is performance based

― 100% pre-negotiated


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73

Guiding Principles for Disciplined M&A

Our M&A

Guiding

Principles

Be fast and nimble to take advantage of opportunities

Approach M&A collaboratively, internally and externally

Measure all deals against quantifiable economic, operational

and strategic criteria – target IRR of >12%

Position ADT as the “Partner/Acquirer of Choice” in the

marketplace

Involve integration team early in the deal process to enable fast,effective integration activities

Identify unknown/exclusive deals to avoid auctions


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74

Built Capabilities to Execute on M&A Opportunities

Deal Origination / Negotiation Due Diligence Integration Process

M&A

Team

SalesR

Operations

Tinance

Legal

Oversee M&A function &

champion acquisitions

Ensure alignment with strategy

Manage process and diligence

Prioritize opportunities

Determine valuations

Develop relationships with

potential target companies

Deal Process

Conduct diligence across all

functional areas

― Synergies

― Quality of customers andoperations

― Growth engine

― Identify risks/opportunities

Support contract negotiations

Integration

Leader

Finance IT Operations

HR Sales

Customer

Experience

Develop integration plan with

timelines and key deliverables

Assimilate into ADT

Integration of sales and

operations Deliver synergies

Execute terms of negotiated

contract with speed and quality

Ongoing assessment of performance and lessons learned

1 2 3

4

Leverage M&A to Further Grow Share and Improve


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75

Economics

Customer Adds

Cost to Serve

Leverage fragmented, changing Home Security and

Automation landscape for attractive M&A

opportunities

Capabilities in place to integrate customer accounts

and operations

Capitalize on synergies that arise from consolidating

operations and capabilities to lower cost to serve


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76

Agenda

Business Overview


Growing Our Business Residential Security and Automation


PERS/Health



Concluding Remarks

Q&A

Mike Geltzeiler – Chief Financial Officer


78/102

77

Prior Experience

Former Chief Financial Officer and Group

Executive Vice President at NYSE Euronext

Former Chief Financial Officer at the Reader’s

Digest Association

Former Chief Financial Officer at ACNielsen

Corporation

Served in a variety of senior finance positions

both in the US and abroad for Dun & Bradstreet

Areas of Expertise

MBA in Finance from New York University’s

Stern School of Business

CPA certification in the State of New York

Bachelor of Science in Accounting from the

University of Delaware

Education

Over 30 years of experience in finance executive roles, much of it atbusinesses with subscription models

Public company CFO for past 13 years, with track record of creating value

for shareholders

Extensive capital markets experience

Expertise in large, complex M&A

International background, includes 7 years work experience abroad

Favorable Market Dynamics and Competitive


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78

Advantages Drive Financial Performance

Strong Recurring Revenue Growth

Attractive Account Growth Opportunities

Consistent ~ 1 billion of steady-state free cash flow generated every year

$1.8$1.9 $1.9

$2.3

$2.8$2.9

$3.0

43.8% 44.4%46.3%

47.5%49.3% 49.8%

51.1%

66.5% 66.7%

$0

$1

$1

$2

$2

$3

$3

$4

$4

2007 2008 2009 2010 2011 2012 2013

Recurring Revenue

EBITDA MarginPro-Forma Pre-SAC EBITDA Margin

(2)(4)

(2)(3)

(1) Pro-forma acquisition of Broadview Security in 2010.

(2) Before special items and non-GAAP. For a reconciliation to the most comparable GAAP measures please see the Appendix.

(3) Not normalized for Dis-Synergies from spinoff from Tyco and Public Company Costs.(4) Normalized for Dis-Synergies from spinoff from Tyco and Public Company Costs.

(5) IRR is calculated on a 15 year, after tax basis.

Dealer

Resi. Direct -

Pulse

Resi. Direct – Trad.

Total Resi.Direct

SB - Pulse

SB – Trad.

Health

Devcon

Large BulkPurchase

0

200

400

600

5% 10% 15% 20%

IRR (5)

F Y 2 0 1 3 C u s t o m

e r A d d i t i o n s ( 0 0 0 s )

Weighted

Average Cost

of Capital

Customer IRRs wellabove weighted

average cost of capital


80/102

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Operating Focus

on Five Value Levers

Customer

Additions

Average Revenue

Per User

(ARPU)

Cost to Serve

(CTS)

Attrition

Subscriber

Acquisition Cost

(SAC)

Optimize Capital

Structure to Propel

Growth

Return Capital to

Shareholders

Organic Customer

Growth

Strategic M&A

3x Leverage Target

Share

Repurchases

Dividend Payout

Ratio of

40%-50%

Total Shareholder Return and Valuation on a Per Share Basis

Overview of Long Term Financial Strategy

ADT Enterprise Valuation


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Note: Unless otherwise noted, all figures are before special items and are non-GAAP measures. For a reconciliation to the most comparable GAAP measures please see the appendix.

(1) Increase mainly due to dis-synergies and public company costs associated with Tyco spinoff.

(2) Excludes subscriber upgrades.

(3) Includes repurchases completed after fiscal year-end.(4) Based on a $41.00 illustrative share price, reflects increase in dividends announced after FY2013 year end.

(5) Based on pro forma capital structure and a $41.00 illustrative share price.

Customer

Additions

Average Revenue

Per User

(ARPU)

Cost to Serve

(CTS)

Attrition

Subscriber

Acquisition Cost

(SAC)

Capital Returns

M&A

Pre-SAC

EBITDA Margin

67%

EBITDA Margin

51%

Steady-State

Free Cash Flow

939 M

EPS using Cash

Tax Rate

2.88

Cash Tax Rate

Recurring

Revenue

3,041 M

+1.1 million

new customers

+40 bps

net attrition

+3.7%

+0.8x

creation multiple(2)

2.4B share

repurchases(3)

2% dividend yield(4)

Devcon and

Absolute

5%-7% to 2022

+ 0.58

per subscriber(1)

Implied FY2013

Trading Multiples

(5)

EV / LTM RMR

47.3x

EV / Pre-SAC

EBITDA

5.8x

EV / SSFCF

12.8x

Cash P/E

14.2x

EV / EBITDA

7.1x

Overview of Cost Efficiency Program


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Cost to

Serve

(CTS)

Subscriber

Acquisition

Cost

(SAC)

Cost

Component

Initiatives in Place

Drive down SAC through sales / marketing

optimization and installation / equipment

rationalization

― Optimize sales and marketingactivities across channels

― Reduce installation costs and further

integrate and automate installation

activities

― Deploy Common Order Entry platform

Create lean support model and reduce G&A

― Continued business simplification and

automation

― Real estate optimization

Reduce CTS through improved maintenance

cost efficiency and use of tools and

technology

Significant Room to

Improve Cost Position

FY2013 focus…

― Separation from Tyco

― Establishing public

company capabilities

… Driving a ramp-up in costs

Renewed focus on cost

efficiency moving forward

― Three year efficiency

program underway

― Tangible opportunitiesidentified

Efficiency Program – Cost to Serve


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Cost to

Serve

(CTS)

G&A

Customer Service

Maintenance

Revenue Share

Bad Debt

Pre-SAC EBITDA Margin

(1)

Cost to Serve per Subscriber

Cost Component

$483M

$212M

$179M

$77M

$49M

66.7%

Cost Reduction Initiatives Impact

10% Overall Reduction

in Cost to Serve per

Subscriber by 2016

Including $50 Million

Reduction in G&Aotal Cost to Serve

12.88

$1,000M

2013

(1) Before special items and non-GAAP. For a reconciliation to the most comparable GAAP measures please see the Appendix.

Efficiency Program – Subscriber Acquisition Cost


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Subscriber

Acquisition

Cost

(SAC)

Net SAC per Subscriber

(3)

Net Creation Multiple

(3)

Cost Component 2013

1,277

Cost Reduction Initiatives Impact

Installation Revenue (P&L and Capitalized)

29.1x

($294)M

1x Reduction

in Net Creation Multiple (2)

by 2016

150bps Improvement

in EBITDA Margin (2)

by 2016

P&L

Portion

of SAC

(1)

Capitalized Direct SAC

Capitalized Dealer SAC

Selling incl.

Commissions

Advertising &

Marketing

Installation

Cost

EBITDA Margin

(2)

$217M

$171M

$60M

51.1%

$738M

$555M

(1) Over 90% attributable to Direct Subscriber Acquisition Cost.(2) Before special items and non-GAAP. For a reconciliation to the most comparable GAAP measures please see the Appendix.

(3) Excluding upgrade costs.

Net Subscriber Acquisition Cost $1,447M

New Steady-State Free Cash Flow (SSFCF) Definition


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Better Reflects Performance

Best proxy for analyzing the cash potential of existing subscriber base― Equalizes deferments and capitalization for cost of replacing attrition

― Strips out amortization complexities and inconsistencies

Captures full impact of all five key value drivers

More intuitive calculation reflects fundamental drivers of value

Simpler,

More Intuitive

Calculation

SSFCF is an

Important

Financial

Metric

Ties back to key value and financial drivers: – Pre-SAC EBITDA

– Direct and Dealer New RPU

– Direct and Dealer SAC

– T12M Disconnects Net of Price Escalation (trends with Net Attrition)

New Methodology Enhances and Simplifies SSFCF Definition to Achieve Greater

Transparency, Understanding and Comparability

Calculation now more aligned with key peers and enhances transparency

New SSFCF Definition Better Captures Performance


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Q4 T12M

FY2013

Free Cash Flow before Special Items

(4)

507

+Interest Paid 107

+Income Taxes Paid, Net of Refunds (2)

+Reduction in Dealer CAPEX 283

SSFCF before Special (Prior Definition)

(4)

895

Start

with fundamental

metric (Pre-SAC

EBITDA)

Q4 FY2013

Last Quarter, Annualized EBITDA (Pre-SAC) 2,108

- SAC to Maintain Recurring Revenue ($1,159)

- Maintenance CAPEX(1) ($10)

SSFCF Before Special Items 939

Last Quarter Average RMR 259

X T12M Disconnects Net of Price Escalation(2) 14.3%

X Last Quarter Gross RMR Creation Multiple(3) 31.3x

SAC to Maintain Recurring Revenue 1,159

Note: All values in $ millions except per subscriber amounts.

(1) Based on management’s estimate of maintenance CAPEX spending in Steady State.

(2) Average T12M recurring revenue disconnected net of price escalations. Disconnects account for dealer chargebacks.

(3) Gross creation cost includes amount held back from dealers for chargebacks.(4) Free Cash Flow before Special and Steady-State Free Cash Flow before Special are non-GAAP measures. For a reconciliation to the most comparable GAAP measure, please refer to the

Investor Relations section of our website at www.adt.com.

Trailing Recurring Revenue 3,063

Gross Attrition 17.1%

Recurring Revenue Lost to Attrition 524

Trailing Recurring Revenue from Price Escalation $85Price Escalation % 2.8%

Net Recurring Revenue Lost 439

Direct Gross Additions (thousands) 654

Direct New ARPU $43.4

Recurring Revenue Created Through Direct 341

Recurring Revenue required through Dealer Channel $98

Gross Dealer Annual Creation Multiple 2.78x

Dealer CAPEX Required to Maintain Recurring 272

Dealer CAPEX Required Under Growth Scenario $555

Dealer CAPX Required for Steady State Scenario $272

Reduction in Dealer CAPEX 283

Prior Definition New Definition

Simplify and relate to

key drivers

(attrition and

creation

multiple)

5% -10% FY2014 Growth 5% - 10% FY2014 Growth

Optimize Capital Structure - 3.0x Leverage


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Increasing leverage to 3.0x provides flexibility to invest in organic growth and pursue

opportunistic M&A while also continuing to return capital to shareholders

Recurring revenue

represents >90% of total

revenue, providing

stability and predictability

Opportunity to Invest in Attractive

Investments and Return Capital

Business Model Supports

3.0x Leverage

Predictable Cash

Flow Generation

Provides flexibility in

downturns to reduce

spending on subscriberacquisitions and limit

downside risk

Scalable and

Flexible Sales

Channel

Opportunity to lock-in

historically low interest

rates

Attractive

Interest Rate

Environment

Attractive Organic

Growth

Opportunities

Well Positioned

as Industry

Consolidator

Capital Return to

Shareholders

Customer accounts IRR

of mid-teens is

significantly higher than

cost of capital

Leader in fragmented

and rapidly changing

industry

Opportunity to return

capital to shareholders

via share repurchases

and dividends

Significant Sources of Capital Over Next Few Years


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~ 3.4 billion of capital available for M&A and shareholder return over the next 2 years and

~ 1.0 billion annually thereafter to invest in acquisitions and return to shareholders

2 Free Cash Flow generated

(2)

andincremental capital from growing EBITDA(1)

Sources of Capital

Total Available Capital

2014-2015

2016+

Annually

~ 1.7B

~ 3.4B

~ 1.0B

~ 1.0B

1~ 1.7B

Incremental capital from increasing

leverage (2.0x to 3.0x Debt/EBITDA(1))0.0B

(1) EBITDA before special items.

(2) Free cash flow after special items.

Note: Figures are illustrative. Free cash flow estimates and incremental capital from growing EBITDA estimates are

contingent on ultimate allocation between acquisitions and share repurchases.

2014 – 2015 Capital Allocation Framework


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~$3.4B

~$1.9B

~$0.3B

~$1.1B

Capital Available Dividends M&A and Share Repurchases

Sources of Capital Uses of Capital

Payout ratio of

40% - 50%

Advantaged position as

industry consolidator, and

opportunity to return significantcapital to shareholders

~$1.2B of share

repurchases

already completed

in FY 2014

M&A Criteria

IRR target >12%

Accretive to Steady-

State Free Cash Flow(1)

Alignment with

strategic criteria:

― Scale / density

― Geography

― Capabilities― Synergies

― Growth engine

Disciplined approach to capital allocation

~$3.1B

(1) Before special items on a levered, after-tax, per share basis.

Note: Figures are illustrative. Free cash flow estimates and incremental capital from growing EBITDA estimates are

contingent on ultimate allocation between acquisitions and share repurchases.

Pro-Forma Capital Structure


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FY 2012

Actual

FY 2013

Actual Pro-Forma

Total Debt $2,527 $3,376 $4.5B

EBITDAbefore special items(1)

$1,609 $1,690 $1.7B

Debt / EBITDA 1.6x 2.0x 2.6x

Diluted Ending Shares

(% reduction)235

212

(9.8%)

187

(20.0%)

Note: Pro-forma incorporates subsequent actions taken since year end:

• $1 billion debt offering closed Oct. 1, 2013

• Net $75M increase in revolver borrowings ($150M repayment and $225M drawdown)

• Share Repurchases: $300M open-market program (7.3 million shares), $400M accelerated

share repurchase program (initial delivery of 7.9 million shares), and $451M bulk purchase from

Corvex (10.2 million shares )

Note: $ in millions unless otherwise noted.(1) EBITDA is before special items and is a non-GAAP measure. For a reconciliation to the most comparable GAAP measures please see the Appendix.

There were no pro-forma adjustments to FY2013 EBITDA.

FY2014 Guidance


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Customer

Additions

Attrition

ARPU

SAC

Cost to Serve

O

a

o

Special Items

Share

Repurchase

M&A

t

a

o

a

o

Consistent growth

Levers Outlook

Expected to stabilize

Grow with Pulse and

escalations

$50-$65M, ~50% allocated

to 2G conversion program

Restructuring, Devcon

integration and Tycoseparation costs

$1.2B to date

Capitalize on advantaged

position as industry

consolidator

Stabilize with

initiatives

Improve with cost-

reduction programs

FY2013A FY2014E

Recurring

Revenue

Growth %

4.8% 4% - 5%

EBITDA Margin %

(before special

items)

51.1%50+ bps

Expansion

Steady-State Free

Cash Flow (1) $939M

+5% - 10%

Growth

Note: Unless otherwise noted, all figures are before special items and are non-GAAP measures. For a reconciliation to the most comparable GAAP measures please see the Appendix.

(1) Based on new definit ion of SSFCF.

Longer Term Outlook


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Recurring Revenue Growth

Adjusted EBITDA Margin Expansion

Steady-State Free Cash Flow Growth

Residential

Small Business

Healthcare

Mid-single digits

Mid-to-high single digits

Double digits

Mid-to-high single digits

150 bps margin expansion over the next three years

High-single digits

M&A


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Agenda

Business Overview


Growing Our Business Residential Security and Automation


PERS/Health



Concluding Remarks

Q&A

What We are Excited to Share About ADT Today


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Strong and

Stable Core

Business

Actionable

Priorities for

Improvement

Opportunity to

Meaningfully

Improve

Margins

Clear Multi-year

Plan for

Success

Right

Leadership

Team to Ensure

Success

25% residential

market share

6.5 million

customers with

>90% recurring

revenue

Attractive

incremental returns

Stabilize attritionOptimize Indirect

channel

Simplify the ADT

value creation story

Cost advantage opportunities in

cost to serve and subscriberacquisition cost

G&A reduction through business

simplification and real estateoptimization

Investing to grow organically

and via M&A

Key financial targets for long

term ADT business success

Complemented existing ADT management team with strong new

additions over the course of the year


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Q&A


96/102


Appendix

Non-GAAP Measures


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Earnings before interest, taxes, depreciation and amortization (EBITDA), EBITDA margin, EBITDA (pre-SAC), EBITDA margin (pre-SAC), steady-state free cash

flow (SSFCF), and EPS at cash tax rates in each case “before special items” and/or “pro-forma” are non-GAAP measures and should not be considered

replacements for GAAP results.

EBITDA is a useful measure of the The ADT Corporation’s (the Company) success in acquiring, retaining and servicing our customer base and ability to

generate and grow recurring revenue while providing a high level of customer service in a cost-effective manner. The difference between Net Income (the

most comparable GAAP measure) and EBITDA (the non-GAAP measure) is the exclusion of interest expense, the provision for income taxes, depreciation

expense and amortization expense. Excluding these items eliminates the impact of expenses associated with our capitalization and tax structure as well as

the impact of non-cash charges related to capital investments.

EBITDA (pre-SAC) is a useful measure of the Company’s success in retaining and servicing our customer base while providing a hig h level of customer service

in a cost-effective manner. The difference between Net Income (the most comparable GAAP measure) and EBITDA (pre-SAC) (the non-GAAP measure) is the

exclusion of interest expense, the provision for income taxes, depreciation expense, amortization expense, and subscriber acquisition related revenue and

expenses. Excluding these items eliminates the impact of expenses associated with our capitalization and tax structure, the impact of non-cash charges

related to capital investments, and the impact of growing our subscriber base.

In addition, from time to t ime, the Company may present EBITDA and EBITDA (pre-SAC) before special items, or on a pro-forma basis which are EBITDA and

EBITDA (pre-SAC), adjusted to exclude the impact of the items highlighted below. These numbers provide information to investors regarding the impact of

certain items management believes are useful to identify, as described below.

There are material limitations to using EBITDA and EBITDA (pre-SAC). EBITDA and EBITDA (pre-SAC) may not be comparable to similarly tit led measures

reported by other companies. Furthermore, EBITDA and EBITDA (pre-SAC) do not take into account certain significant items, including depreciation expense,

amortization expense, interest expense, and tax expense, which directly affect our net income. Additionally, EBITDA (pre-SAC) does not take into account

expenses related to acquiring new customers. These limitations are best addressed by considering the economic effects of the excluded items independently,

and by considering EBITDA and EBITDA (pre-SAC) in conjunction with net income as calculated in accordance with GAAP.

Non-GAAP Measures (continued)


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SSFCF is a useful measure of pre-levered c

ADT Investor Day Presentation 2013

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