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Imation’s Profitable Growth Strategy

Frank Russomanno President & Acting CEO

November 14, 2006

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Corporate

Acting CEOFrank Russomanno

President

Acting CEOFrank Russomanno

President

EMEA RegionBrian Plummer, VP

EMEA RegionBrian Plummer, VP

Asia/Pacific RegionNobuyoshi Kawasaki, VP*

Asia/Pacific RegionNobuyoshi Kawasaki, VP*

Retail/ConsumerDivision - Americas

(Memorex US)Ron Zinke, VP

Retail/ConsumerDivision - Americas

(Memorex US)Ron Zinke, VP

Investor RelationsAnd Communications

Brad Allen, VP

Investor RelationsAnd Communications

Brad Allen, VP

FinancePaul Zeller

VP and CFO

FinancePaul Zeller

VP and CFO

Human ResourcesJackie Chase, VP

Human ResourcesJackie Chase, VP

LegalJohn Sullivan

SVP and Gen. Counsel

LegalJohn Sullivan

SVP and Gen. Counsel

CommercialData Storage Division

- AmericasJim Milligan, GM

CommercialData Storage Division

- AmericasJim Milligan, GM

SourcingRandy Christoffersen, VP

SourcingRandy Christoffersen, VP

Strategic Growth ProgramsJim Ellis, VP

Strategic Growth ProgramsJim Ellis, VP

R&D and ManufacturingDr. Subodh Kulkarni, VP

R&D and ManufacturingDr. Subodh Kulkarni, VP

Information TechnologyJack McNamara, Exec Director

Information TechnologyJack McNamara, Exec Director

Imation Board of Directors

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Our Goal…

To be the undisputed leading global removable media supplier across multiple brands and technology platforms

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Agenda

• Imation Overview & Opportunities

• Memorex Integration Update

• Lean Transformation

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Five Traits that Describe Imation

• Industry Legacy and Expertise • Broad Product Portfolio & Deep Technology

Capability• Global Footprint & Channel Expertise• Focused on Removable Storage Media• Financially Disciplined, Cost Focused & Lean

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The Company’s Heritage Goes Back to the 1950s …

1952 - 3M Introduces First Commercial Magnetic Data Storage Tape

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Imation/3M Industry Firsts

• First commercial audio tape

• First commercial computer tape

• First video tape (Emmy)

• First metal particulate tape

• First data cartridge

• A pioneer in optical recording

Imation/3M Industry Firsts

• First commercial audio tape

• First commercial computer tape

• First video tape (Emmy)

• First metal particulate tape

• First data cartridge

• A pioneer in optical recording

… and has a Long Legacy of Industry Innovation

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New Growth Area

#2 U.S; Growing Worldwide

#1 Worldwide

#1 Worldwide

Imation Market Position

Key CompetitorsMedia Type

Quantum, ADICRemovable Hard Disk

Sandisk, Lexar, PNYUSB Flash Memory

Verbatim, Maxell, TDKOptical Media

Fuji, Maxell, TDK, SonyMagnetic Tape

Imation Offers a Broad Product Portfolio Across Four Pillars of Removable Data Storage Media

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• R&D in magnetics, optical, solid state memory• Terabyte-class magnetic tape pilot factory• Blu-ray and HD-DVD manufacturing• 200+ technology scientists • 300+ U.S. patents

• R&D in magnetics, optical, solid state memory• Terabyte-class magnetic tape pilot factory• Blu-ray and HD-DVD manufacturing• 200+ technology scientists • 300+ U.S. patents

Imation’s Deep Technology Portfolio Grows out of the Discovery Technology Center

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Imation has a Broad Global Footprint(9 Months Revenue YTD)

Corporate HQ& Technical Center

Oakdale, MNOakdale, MN

Worldwide HeadquartersProduction FacilitiesProduction FacilitiesSubsidiaries, Sales Office

Percent of Global Revenue

European HQSchiphol, Netherlands

APAC HQTokyo, JapanTokyo, Japan

Americas~ 47%

APAC~ 19%

Europe~ 35%

EuropeanTechnical Center

112005 CY– Source: Company Reports, Imation Estimates

Imation SonyFujiMaxell

Data Storage Media Revenue All Other Revenue

100% <40% ~10% <3% ~1%$1,258.1M ~$700M ~$700M ~$600M ~$700M

TDK

% of Total Company Revenue from Data Storage MediaAnd CY 2005Data Storage Revenue (est.)

Imation is the Only Major Company Among Key Competitors 100% Focused on Data Storage

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Entering into new adjacencies2Defending or

enhancing the core1

Core – RemovableStorage Media• Tape• Optical• Flash• HDD

We Are Looking Beyond Our BaseBusinesses For Growth Opportunities

• Create/add value to justifies acquisition premium

• Markets include archiving, advanced optical applications

• Secure or fundamentally alter competitive positioning

• Translates into increased sales and profits

MainTheme:

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Summary Points on Memorex Acquisition

• Part of a systematic strategy begun February 2005.

• We brought together a premier brand, and combined it with a very strong data storage technology company.

• The combined annualized revenues is expected to approach $1.8 billion with operating profits of approximately $140 million.

• Memorex will take the lead in the retail business in the U.S., and Imation will take the lead in the B2B business.

• Brand strength varies by region.

• Transaction creates significant shareholder value and is highly accretive in 2007 and beyond.

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Memorex Enjoys High Brand Recognition & Regard in the U.S.

High

HighHighLow Regard

Rec

ogni

tion

Source: Proprietary Imation research by Lubin Lawrence

US Retail/Office Survey

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Most of Memorex’s Sales are in Optical Mediaand USB Flash Memory

2006 Estimate ~65% ~5% ~15% ~15%

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The top 100 U.S.A. consumer electronics retailers generated $106.6 Billion, representing over 69,869 retail locations

The Top 25 U.S.A. consumer electronics retailers equal over 89% of the total consumer electronic sales in the U.S.A. That represents over 23,822 retail locations

Memorex selling to 10 out of top 10 retailers

Memorex is in All of the Top-10 and in 21 of the Top-25 Consumer Electronic Retailers in the U.S.

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Memorex Integration is on Track

• Major Focus Areas- Supply Chain- Sourcing- Back Office- Sales and Marketing

• 285 Major Milestones• Results to Date (Day 198)

- 91% Complete- On Schedule in All Areas Except One- Synergy Benefits on Plan- No Customer Disruptions- Financial Contribution as Expected

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Imation is Transforming into a Lean Organization Across all Major Functions

and Key Business Processes

• Lean Principles Focus on Speed, Quality, Cost• In 2006 YTD:

~ 125 Training Events~ 630 Participants~ 47,000 hours (24 FTE) made available for other use~ $14MM in annualized cost reduction, cost avoidance

and savings

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WahpetonPancake

Supermarket Servo

MillingCoating

&Slitting

KanbanLoop

KanbanLoop

WahpetonLoop

InternalSuppliers

ExternalSuppliers

KanbanLoop

Data CenterPancake

Supermarket

Data Center Camarillo Pull – Scheduling Kanban System

KanbanLoop

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A Picture of Imation Camarillo 2007/2008

Measure Performance

Manufacturing Lead Time 2X to 3X FasterDelivered Quality 3 PPMDelivery Performance 99+%Inventory Turns 2X to 3X HigherConverting Costs (Materials 25-40% Less Than Pastto Finished Goods)Manufacturing Space 35-50% Less(Assembly/Pack out)

All Lean Tools Used

Baseline: January 2005

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Thank you!