STEP Energy Services — Q1 2025 Earnings Presentation
21 slides from STEP Energy Services's earnings presentation, May 2025
Slide 1: Investor Presentation First Quarter 2025
HYDRAULIC FRACTURING | COILED TUBING | FLUID PUMPING | NITROGEN INDUSTRIAL SERVICES INVESTOR PRESENTATION FIRST QUARTER 2025 MAY 2025
Slide 2: STEP Energy Services by the numbers
Step energy services BY THE NUMBERS: 474,800* Montney Fracturing horsepower *78% of horsepower is dual-fuel capable Deep Basin Duvernay 6 Viking Calgary Fracturing fleets (active) 22 Bakken Coiled tubing units (active) Powder River Basin 10 Niobrara Service centers serving North America’s most activ
Slide 3: Primary service lines
Primary service lines HYDRAULIC FRACTURING • Hydraulic fracturing is a critical well stimulation technique used to enhance oil and gas production, particularly in shale formations such as the Montney, Duvernay, Bakken, Permian, and Eagle Ford • The process involves pumping specially engineered fluid
Slide 4: World class resource plays: Montney & Duvernay
World class resource plays: Montney & Duvernay Canada has two of North America’s premier resource plays in the Montney and Duvernay. STEP leverages strategic positioning, a dvanced technology, and strong industry partnerships to support long-term energy growth. WHY THE MONTNEY? UNTAPPED DUVERNAY POT
Slide 5: STEP's value proposition in these resource-rich plays
STEP’s Value proposition in these resource-rich plays 1. STRATEGICALLY LOCATED FOR OPERATIONAL CONTINUITY • Service centers in Red Deer, Grande Prairie, and Fort St. John provide strong regional coverage • Enables seamless access and consistent execution across the Montney and Duvernay Montney 2. EX
Slide 6: The U.S. region – service intensity expected to rise
The u.s. region – service intensity expected to rise LATERAL LENGTHS IN THE MIDLAND BASIN (EXAMPLE) • The U.S. shale plays have been extensively developed, depleting much of the Up 4% 11500 best acreage and forcing oil and gas producers to deploy increased service intensity to achieve similar result
Slide 7: LNG export capacity to more than double by 2028
LNG EXPORT CAPACITY TO MORE THAN DOUBLE BY 2028 NORTH AMERICAN LNG EXPORT CAPACITY BY PROJECT (2016-2028) billion cubic feet per day ~6.7 Bcf/day in LNG export projects proposed and under construction in Canada, 2025 Capacity Project Status Timeline (Bcf/d) Nearing completion LNG Canada Phase 1 (Kit
Slide 8: Canadian natural gas demand outlook
Canadian natural gas demand outlook INCREASED DEMAND FORECASTED THROUGH 2030 Source: Peters & Co. Limited, WCSB Natural Gas Update (March 2025) CLIENT ACTIVITY IN MONTNEY EXPECTED TO SURGE IN THE SECOND HALF OF THIS DECADE • 35% increase in demand anticipated through to the end of the decade; LNG ex
Slide 9: Driving shareholder returns through performance
Driving shareholder returns through performance FRACTURING COILED TUBING • Canada pumped record setting ~631 thousand metric tons (MT) of sand in • Completed largest annular fracturing job in North America (299 stages) in Q1-25 Q1-25 - Set company record of over 6,183 MT of sand pumped in one day in
Slide 10: Financial performance
FINANCIAL PERFORMANCE Q1-2025 – A QUARTER IN REVIEW VALUATION MULTIPLE • Fracturing saw another record revenue setting quarter amidst a declining 4.0x $7.00 commodity price environment overshadowed by the uncertainty of trade $6.50 3.5x tariffs $6.00 EV/EBITDA Multiple - Margins came under pressure
Slide 11: 2025 macro outlook
2025 macro outlook • The global economy faces uncertainty as U.S. trade actions and international responses create volatility, potentially slowing growth and pressuring commodity prices • Natural gas prices are recovering from multi decade lows set in 2024, but crude oil prices may see pressure from
Slide 12: Generation of free cash flow creating shareholder value
GENERATION OF FREE CASH FLOW CREATING SHAREHOLDER VALUE ~$270 MILLION REDUCTION OF NET DEBT SINCE 2018 >$300 MILLION OF FREE CASH FLOW GENERATION SINCE 2021 EBITDA Net Debt Net Debt/EBITDA $120,000 $111,788 $350,000 8.0x $300,000 7.0x $100,000 $82,811 $85,715 Free Cash Flow (000s) $250,000 6.0x Net
Slide 13: Capital allocation framework
Capital allocation framework CAPITAL BUDGET • 2025 capital budget of $79 million includes optimization capital of $47 million and sustaining capital of $32 million - STEP at closely matches its capital budget to depreciation – sign of a well-maintained fleet • Optimization capital is focused on natu
Slide 14: Cutting edge coiled tubing technology
CUTTING EDGE COILED TUBING TECHNOLOGY EXTENDED-REACH SOLUTIONS STEP-IQ REAL-TIME DATA SERVICES • STEP is the largest deep-capacity coiled tubing provider in North America • STEP-conneCT: Real-time down hole data acquisition tool - Capability to reach depths of over 8,500 meters (28,000 feet) - Large
Slide 15: Next-generation frac innovation: natural gas strategy
Next-generation frac innovation: natural gas strategy 1. 100% NATURAL GAS-POWERED FRACTURING PUMP – THE NGx • STEP is trialing the industry’s first 100% natural gas-powered reciprocating engine that could lead to the near elimination of diesel on client locations – Supports lower-cost, alternative f
Slide 16: STEP's last mile logistics fleet
STEP’S LAST MILE LOGISTICS FLEET A Montney well may require up to 6,200 MT of sand pumped in a 24-hour period. This equals about 145-150 truck loads (b-trains), or one truck every ten minutes. INVESTMENT IN INTERNAL HAULING AND SAND SUPPLY EFFICIENCY • STEP has one of the largest internal hauling fl
Slide 17: Logistics and last mile solutions increasingly important
LOGISTICS AND LAST MILE SOLUTIONS INCREASINGLY IMPORTANT CANADA PROPPANT SUPPLY/DEMAND million tonnes per annum Source: Peters & Co. Limited: WCSB Frac Sand Market Overview (November 2024) DEMAND AND WELL INTENSITY INCREASING – NORTH AMERICAN PROPPANT METRICS • Forecasts point to continued sand dema
Slide 18: Summary
SUMMARY HOW STEP CREATES SHAREHOLDER VALUE • Q1-2025: - Canadian fracturing saw another quarter of record setting revenue even as commodity prices remained unsettled - Coiled tubing services on both sides of the border saw strong quarters similar to the same period in the prior year - Results have b
Slide 19: Why invest in STEP Energy Services?
Why invest in step energy services? Operating regions shareholder returns technology VALUATION MULTIPLE STEP strategically operates in Operational performance drives Cutting-edge technology and Measured against peers, STEP some of North America’s largest, financial results, creating services like ST
Slide 20: Disclaimer
DISCLAIMER The information contained in this presentation does not purport to be all-inclusive or to contain all information that prospective investors may assumptions, risk factors, limitations, and qualifications as set forth in the above paragraphs. The actual results of operations of STEP and th
Slide 21: Investor Relations contact
403-457-1772 Investor_Relations@step-es.com www.stepenergyservices.com 21