ADT 2013 Annual Report Download - page 3

DEAR SHAREHOLDERS—
2013 was an exciting year for ADT. We began operating
as a public company, added new talent to our executive
management team, and continued to invest in technology
and innovation to fuel revenue growth, while also improving
our nancial performance and returning $1.4 billion of
capital to our shareholders.
THE ADT CORPORATION 2013 ANNUAL REPORT
It is a dynamic time for the electronic
security industry, and ADT’s unparalleled
size, scale and brand strength uniquely
position us for success. We have more
than a 25 percent share of the $11
billion residential security and automation
industry, and a 13 percent share of the
$2.4 billion small business security and
automation industry. Today, we are more
than six times the size of our nearest
competitor, with 6.5 million customers
across the U.S. and Canada. More than
90 percent of our revenue is recurring
revenue, and during the year we grew
this recurring revenue by nearly 5 percent
compared to 2012.
“ When consumers think of
security, they think of ADT.”
Our market leadership position gives
us several advantages over both new
and traditional competitors. First, we
have unparalleled brand awareness.
With nearly 90 percent aided brand
awareness, it is safe to say when
consumers think of security, they think
of ADT. More than 50 percent of ADT
customers surveyed told us they did
not consider any other company when
making their purchase decision. Second,
we offer consumers the benets of our
unique national and local scale. We have
six fully-redundant customer monitoring
centers across the U.S. and Canada to
ensure the reliability of our alarm signal
emergency response, and yet, a local
ADT sales representative or technician
can also come to your home or business,
wherever you are based, to design a
system that meets your unique needs or
service your existing system. Third, we
leverage our 139 years of experience in
the security industry and our commitment
to innovation to ensure that the quality,
reliability and user experience of our
technology is second to none. Our
interactive services platform, ADT Pulse,
has grown to more than one-half million
customers, and take rates continue to
improve each quarter. Fourth, we have
17,000 ADT employees and 350 ADT
Authorized Dealers who are proud to be
“customer obsessed.” The average ADT
employee tenure is six years, which is
longer than some competitors have been
in the industry.
Despite our compelling leadership position,
we are committed to acting with the agility,
speed and passion of a one-year-old
startup rather than a 139-year-old industry
titan. It is incumbent on us, as the industry
leader, to pioneer the evolution of security
for a mobile, always-on, on-demand world.
We navigate this dynamic environment by
staying focused on what matters most to
ADT’s stakeholders: our customers, our
employees, our shareholders, and the
communities where we live and work.
Our leadership team recently prepared and
began executing on a multi-year plan to
ensure ADT’s continued success. Over the
next three years, we will deliver innovations
that differentiate ADT and enhance
the customer experience, while also
meaningfully improving our prot margins
and returns to investors. With the freedom
and exibility to set our own course as a
standalone public company, and a new
management team fully aligned to drive
our strategy, ADT will continue to lead and
redene security for the next generation.
Thank you for your support and
partnership as we forge ahead.
Regards,
Naren Gursahaney
President & Chief Executive Ofcer
The ADT Corporation