Flotek Industries, Inc. · NYSE:FTK
Flotek Industries — Corporate Update (March 2022)
14 slides from Flotek Industries's corporate update, Mar 10, 2022
Slide 1: Sustainable Chemistry Collaborative Partnerships: ProFrac Partnership and Supply Agreement
Sustainable Chemistry Collaborative Partnerships Accelerating Green Chemistry, Powering Progress ProFrac Partnership and Supply Agreement NYSE: FTK Exhibit 99.1
Slide 2: Forward-Looking Statements
2FLOTEK 2022 Forward-Looking Statements Certain statements set forth in this presentation constitute forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934) regarding Flotek Industries, Inc.’s business, finan
Slide 3: Agenda
3FLOTEK 2022 AGENDA Company Overview 3 Business Philosophy 4 Strategic Rationale 5 Flotek Supply Agreement 6 • Current supply agreement • Proposed supply agreement amendment • Revenue impact • Operational alignment and risk management Investment Highlights 11
Slide 4: Flotek is a technology-driven chemistry and data analytics company
4FLOTEK 2022 Flotek Industries, Inc. is a technology-driven chemistry and data analytics company The Company operates through two divisions: - Chemistry Technologies segment provides sustainable, optimized chemistry solutions that maximize our customers’ value by elevating their ESG performance, low
Slide 5: Business Philosophy
5FLOTEK 2022 BUSINESS PHILOSOPHY Low Leverage - Use of equity instead of debt to position company for full cycle Sustainable Revenue - Multi-year contracted revenue Capital Discipline - Current infrastructure supports new contracts & organic business Focus on Profitability - G&A < 10% of revenue and
Slide 6: Collaborative Partnership (pending)
6FLOTEK 2022 • Integration of the largest private North American provider of hydraulic fracturing services by horsepower with industry leading sustainable chemistry provider • Emissions friendly conventional fleets equipped with new technologies reduce the environmental impact of operations and incr
Slide 7: Strategic Framework
7FLOTEK 2022 • Flotek will provide effectively all downhole chemicals needed for ProFrac’s hydraulic fracturing operations for a specified number of fleets • The baseline level of chemicals supplied to ProFrac per fleet is defined in the Current Supply Agreement and Proposed Amendment • In exchange
Slide 8: Current Supply Agreement
8FLOTEK 2022 • Current supply agreement closed on February 2, 2022 • Contract begins on April 1, 2022 • ProFrac received $10 million in Convertible PIK Notes as consideration for a 3-year committed volume contract • ProFrac has the right to nominate 2 directors • ProFrac owns greater than 16%1 CURRE
Slide 9: Proposed Supply Agreement Amendment
9FLOTEK 2022 • Amendment negotiated on February 17, 2022 • Anticipated to close in Q2 2022 subject to shareholder vote • ProFrac receives an incremental $50 million in Convertible PIK Notes as consideration for the amendment extension • ProFrac has the right to nominate 2 additional directors • ProF
Slide 10: Revenue Impact Comparison
10FLOTEK 2022 REVENUE IMPACT COMPARISON Current agreement value $225+MM Proposed amendment incremental value $1.8+BB Capex Minimal (maintenance) Required incremental SG&A Minimal $- $50,000 $100,000 $150,000 $200,000 $250,000 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 Current Supply Agre
Slide 11: Operational Alignment and Managing Risk
11FLOTEK 2022 • Collaborative supply chain partnerships • Flotek specialty chemical blending facilities • Flotek laboratory capabilities • Flotek prescriptive chemistry management OPERATIONAL ALIGNMENT AND MANAGING RISK Safety 0.00 TRIR in 2022 Service quality 0.00 hrs of NPT in 2022 Annual liquid b
Slide 12: Proposed Amendment Investment Highlights
12FLOTEK 2022 2022P Revenue ~ 4X growth YoY Contracted backlog revenue ~ $2.0+BB Total issued patents 125+ Management experience 150+ years Estimated positive EBITDA Q4 22 PROPOSED AMENDMENT INVESTMENT HIGHLIGHTS Green products and solutions reduce the environmental impact of energy Improved financi
Slide 13: Request for Approval
13FLOTEK 2022 REQUEST FOR APPROVAL Current agreement value $225+MM Proposed amendment incremental value $1.8+BB Capex Minimal (maintenance) Required incremental SG&A Minimal $- $50,000 $100,000 $150,000 $200,000 $250,000 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 Current Supply Agreement
Slide 14: Additional Information And Where to Find It
14FLOTEK 2022 Additional Information And Where to Find It The Company intends to file a preliminary proxy statement with the SEC in connection with the transaction discussed in this presentation, and will mail a definitive proxy statement and other relevant documents to its stockholders. This presen