Key Energy Services Inc · OTC:KEGX
Key Energy Services — Barclays CEO Energy-Power Conference 2013
31 slides from Key Energy Services's conference presentation, Sep 12, 2013
Slide 1: Barclays CEO Energy-Power Conference
Barclays CEO Energy-Power Conference September 12, 2013 Dick Alario Chairman, President and Chief Executive Officer
Slide 2: Safe Harbor Language
Safe Harbor Language This presentation and related commentary may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements as to matters that are not of historic fact are forward-looking statements. These forward-looking statemen
Slide 3: Key Energy Services Investment Highlights
Key Energy Services Investment Highlights We have a strong reputation as a high value service provider throughout the well life cycle We are the global leader in onshore, rig-based well services We are well-positioned to benefit from long-term secular trends both in the U.S. and internationally We h
Slide 4: KEG: A Leader in Energy Production Services
KEG: A Leader in Energy Production Services Revenue from Continuing Operations during Q2 2013. Results from Continuing Operations exclude Key's Argentina operations which were sold effective September 14, 2012. Revenue from Continuing Operations in the U.S. during Q2 2013. Oil includes other liquids
Slide 5: High Value Service Throughout the Well Life Cycle
High Value Service Throughout the Well Life Cycle
Slide 6: Key's Suite of Services Throughout the Life of a Well
Key's Suite of Services Throughout the Life of a Well Rig Services Fishing & Rental Tools Rig Services Coiled Tubing Fishing & Rental Tools Fluid Management Services Rig Services Coiled Tubing Fishing & Rental Tools Fluid Management Services Rig Services Coiled Tubing Fishing & Rental Tools Fluid Ma
Slide 7: Rig Services Business Overview
Rig Services Wellbore Cleanout Business Overview Rig Services deploys well service rigs that have been built to increase safety and reliability while reducing the chance of unplanned downtime Services include: Completion of newly-drilled horizontal and vertical wellbores Recompletion of existing wel
Slide 8: Key has the #1 position in U.S. onshore, rig-based well services
Key has the #1 position in U.S. onshore, rig-based well services Rig Services Trends & Dynamics1 Well servicing has a greater percentage of small, independent service companies than any other oilfield service segment Top 5 companies have 57% of the segment with remaining 43% divided among as many as
Slide 9: The KeyView System
The KeyView(r) System The KeyView(r) system is a proprietary technology that provides equipment-verified data to achieve enhanced operational IQ Patented system with job activity monitoring, recording capabilities and automated controls that provides operators with an "intelligent" rig that can mean
Slide 10: Coiled Tubing Services Business Overview
Coiled Tubing Services Wellbore Cleanout Business Overview Key's Coiled Tubing Services delivers value and time savings by minimizing downtime and reducing time to completion Services include: Completion of newly drilled horizontal wellbores pre and post hydraulic fracturing Maintenance of producing
Slide 11: Coiled Tubing Services Trends & Dynamics
Coiled Tubing Services Trends & Dynamics Industry demand for large diameter coiled tubing is growing rapidly to service longer lateral horizontal wells Growth is highly correlated to well count, both horizontal and vertical Beneficiary of evolution to multi-stage frac jobs and pad drilling which cre
Slide 12: Fishing and Rental Services Business Overview
Fishing and Rental Services Business Overview Rental equipment used in the drilling and completion of wellbores including drill pipe, blowout preventers, frac stacks and well-testing equipment and services Rental equipment used in the maintenance and workover of producing wellbores including tubing
Slide 13: Fishing and Rental Services Trends & Dynamics
Fishing and Rental Services Trends & Dynamics1 Strong demand driven by growth of complex wellbores and increased need for specialty downhole services such as fishing and hole preparation for directional drilling As longer lateral wellbores are drilled on multi-well pads, the demand for more complex
Slide 14: Fluid Management Services Business Overview
Fluid Management Services Business Overview Transportation of fluids, including sourcing of brine and fresh water, used in the drilling and completion process Transportation of frac flowback and produced water from completed or producing wellbores Temporary on-site fluids storage via frac tank renta
Slide 15: Fluid Management Services Trends & Dynamics
Fluid Management Services Trends & Dynamics Performance correlated to unconventional activity Relatively low barriers to entry due to the nature of the asset base creates fragmented market Competitive environment remains fierce which pressures pricing Key Positioning Historical Revenue ($mm) Revenue
Slide 16: Financial Performance
Financial Performance
Slide 17: Key's Performance Through Market Cycles
Key's Performance Through Market Cycles Consolidated Operating Income Margin Source: Bloomberg 1. Source: Wall Street Research. Key demonstrated relative stability through the steep cyclical downturn of 2009 In cyclical upturn, Key demonstrated superior performance
Slide 18: Balance Sheet & Liquidity Overview
Balance Sheet & Liquidity Overview (1) Reflects $675.0 million of principal notes plus $4.3 million of unamortized bond premium. (2) Defined as total cash plus remaining credit facility capacity, less Letters of Credit outstanding. Revolver capacity available for borrowing herein has been adjusted t
Slide 19: Key's Capital Discipline
Key's Capital Discipline Note: 2013E operating cash flow based on IBES consensus forecast. 2013E capex based on Key guidance. 1. Peer group composed of BAS, SPN, PES, and FES. Key's capital discipline has provided flexibility and the ability to target modest leverage levels through market cycles 9.4
Slide 20: Operating Leverage Indicates Upside Opportunity
Operating Leverage Indicates Upside Opportunity Wellbore Cleanout U.S. Rig Hours & Rig Services Revenues U.S. Trucking Hours & Fluid Management Revenues Revenue upside without meaningful expenditure via potential for increased asset utilization Revenues ($ in millions) Revenues ($ in millions)
Slide 21: Balanced Approach to Capital Allocation & Rigorous Expense Management
Balanced Approach to Capital Allocation & Rigorous Expense Management Rationalize or Redeploy Underutilized Assets Discipline in Process, Accountability, Cost and Compliance Overall Aim to Deploy Capital to Achieve Best Possible Return for Shareholders Commentary Key constantly evaluates the best us
Slide 22: Key Energy's Differentiated Platform and Opportunities
Key Energy's Differentiated Platform and Opportunities
Slide 23: Key Energy's Differentiated Platform
Well Servicing Workover Drilling & Completion Fluid Management Coiled Tubing Fishing & Rental Well Servicing Workover & Completion Coiled Tubing Integrated Solutions Well Servicing Workover & Completion Well Servicing Workover & Completion Well Servicing Workover & Completion Reservoir Engineering D
Slide 24: International Markets Offer Significant Growth Opportunity
International Markets Offer Significant Growth Opportunity Key is well positioned to serve emerging international markets Strong, international brand recognition and highly capable local teams Capabilities unique to local markets to optimize maturing oilfields Diversifying customer base and geograph
Slide 25: U.S. Market Trends: A Changing Landscape
U.S. Market Trends: A Changing Landscape Horizontal drilling technology matures, the impacts of which are now being felt across the industry Operators have achieved meaningful efficiency gains through the optimization of horizontal drilling techniques and pad drilling Net effect of drilling efficien
Slide 26: Positioned to Benefit from Long-Term Secular Trends
Positioned to Benefit from Long-Term Secular Trends U.S. onshore shale development is entering the "manufacturing" phase of the cycle Sophisticated pad drilling programs aimed at speed and efficiency will be the industry model Relatively young horizontal wells will age and the complexity of these we
Slide 27: Key Energy: The Path Forward
Key Energy: The Path Forward Key will continue to carry out the actions necessary to thrive in today's service market: Leverage an asset base that has sufficient capacity to achieve meaningful growth Execute business development effort to broaden target customer base, targeting those operators most
Slide 28: Key Energy Services Investment Highlights
Key Energy Services Investment Highlights We have a strong reputation as a high value service provider throughout the well life cycle We are the global leader in onshore, rig-based well services We are well-positioned to benefit from long-term secular trends both in the U.S. and internationally We h
Slide 29: Appendix
Appendix ey
Slide 30: Appendix - U.S. Market Trends
Appendix - U. S. Market Trends US Commodity Price Dynamics Oil and Gas Rig Count
Slide 31: Appendix - Adjusted EBITDA Reconciliation
Appendix - Adjusted EBITDA Reconciliation Note: Represents results from continuing operations. "EBITDA" is defined as income or loss from continuing operations attributable to Key before interest, taxes, depreciation, and amortization. "Adjusted EBITDA" is EBITDA as further adjusted for certain non-
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