Toromont Industries Ltd. · TSX:TIH
Toromont Industries — Merger or Acquisition (November 2010)
34 slides from Toromont Industries's merger presentation, November 2010
Slide 1: Creating Two Market Leaders
TOROMONT Creating Two Market Leaders
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements and information herein that are not historical facts are "forward-looking information". Words such as “plans”, “intends”, “outlook”, “expects”, “anticipates”, “estimates”, “believes”, "likely", “should”, "could", "will", "may" and similar expressions often ident
Slide 3: Toromont Today
Toromont Today REVENUE* $2.6 Billion EBITDA* $273 Million EBIT* $198 Million MARKET CAP $2.3 Billion EMPLOYEES 6,000 LOCATIONS 180 COUNTRIES 35 * 2009 Pro forma including Enerflex 21 Years of Consistent Dividend Increases 3
Slide 4: Growth and Profitability Throughout the Cycle
Growth and Profitability Throughout the Cycle Net Earnings* EPS (Millions) ($ Dollars per Share) 160 4.0 140.5 122.3 120.5 120 3.0 99.4 78.9 80 70.5 2.0 58.7 43.7 40.5 40 32.3 1.0 0 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Net Earnings EPS * Actual i.e. pre Enerflex 10 Year CAGR of 16% 4
Slide 5: Strong History of Shareholders Returns
Strong History of Shareholders Returns Total Return 350% 300% 250% 200% 150% 100% 50% 0% -50% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TIH CN Equity SPTSX Index Source: Bloomberg 3.5x TSX Returns over 10 Years 5
Slide 6: Creating Two Market Leaders
Creating Two Market Leaders TODAY POST SPIN OFF TSX Listed TSX Listed TSX Listed EQUIPMENT COMPRESSION ENERGY GROUP INDUSTRIAL GROUP SERVICES 6
Slide 7: Strategic Rationale
Strategic Rationale Creates market leaders with critical mass and momentum Sharper business and strategic focus Incremental growth opportunities Enhanced access to growth capital Improved market understanding and valuation Better ability to attract, retain and motivate key employees Tran
Slide 8: Transaction Timing
Transaction Timing Integration successful and largely complete Proven management teams are in place Increased bookings and order backlog improves visibility for emergent recovery and future results Recent significant orders reflective of major initiatives on both sides of business (Australia
Slide 9: World Leading Pure-Play Supplier of Natural Gas Production and Processing Equipment
World Leading Pure-Play Supplier of Natural Gas Production and Processing Equipment REVENUE* $1.5 Billion Sales & Service EMPLOYEES 3,000 Locations SALES & SERVICE LOCATIONS >50 COUNTRIES 35 * 2009 Pro forma Calgary, Alberta Nisku, Alberta Casper, Wyoming Houston, Texas Rijsenhout, Netherlands Perth
Slide 10: New Enerflex Investment Highlights
New Enerflex Investment Highlights World leading pure-play supplier of natural gas compression and production and processing equipment Strong growth platform in North American shale gas, Australian CBM to LNG and Middle East conventional gas Early stages of industry recovery with growing order
Slide 11: Integrated Distributor of Caterpillar and Other Industrial Equipment
Integrated Distributor of Caterpillar and Other Industrial Equipment REVENUE* $1.1 Billion EMPLOYEES 2,900 Cat Battlefield SALES & SERVICE Cat Mine LOCATIONS >100 AR Sites * 2009 Pro forma AL CIMCO Includes One of the World’s Largest CAT Equipment Dealers 11
Slide 12: The New Toromont Investment Highlights
The New Toromont Investment Highlights One of the world’s leading Caterpillar equipment dealers and the clear market leader in territories served Leading equipment rental operation Canada’s leading industrial and recreational refrigeration company Highly diversified by customer and end marke
Slide 13: ENERFLEX
ENERFLEX
Slide 14: Wide Range of Specialty Customized Equipment
Wide Range of Specialty Customized Equipment Natural Gas Compression Production and Processing Reciprocating, rotary screw and Systems for gas plants (dew point) scroll compression applications and refrigeration systems Medium to large horsepower Amine systems (H2S and CO2 (1,000 – 9,000) re
Slide 15: Midstream and Downstream Applications
Midstream and Downstream Applications Pipeline & storage facilities Power generation Petrochemical Service Offering Mechanical for natural gas engine compressors and power generators Construction product installation Equipment operating business Preferred Single Source Supplier 15
Slide 16: Balanced and Diversified Revenue
Balanced and Diversified Revenue Geographic Distribution Product Distribution Rentals 4% Canada Parts & International Services Fabrication 32% 72% 28% 25% US 32% 40% 2009 $1.6 Billion 2009 $1.6 Billion Pro forma Parts & Service and Rental Significant International Expansion are Key Growth Opportunit
Slide 17: Growing Order Bookings and Backlog
Growing Order Bookings and Backlog Enerflex (Pro Forma) ($ millions) 1,200 1,000 800 600 400 200 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2007 2008 2009 2010 Backlog Bookings Early Stages of Industry Recovery 17
Slide 18: U.S. Shale Gas Growth
U.S. Shale Gas Growth Shale development a substantial shift in natural gas proven reserves and U.S. energy fundamentals >$20 million invested in service infrastructure Well positioned for leading market position Casper, WY Marcellus PA UT CO Sale & Service Locations Fabrication Plants Shale Ga
Slide 19: Australian CBM to LNG Growth
Australian CBM to LNG Growth 4 multi-billion projects under development Queensland Train 1 deliveries 2012 – 2015 Train 2 deliveries 2015 – 2020 Gladstone LNG 2 1 GLNG QCLNG 4 3 $193 million lead order in APLNG October 2010 New Brisbane Facility Major CMB to LNG Projects 1. Santos (GLNG) 2.
Slide 20: Middle East Growth
Middle East Growth Kuwait Libya Egypt Qatar UAE Oman 44% of world gas supplies coming on stream LNG Power generation Fertilizer Water desalination Abu Dhabi office with sales, engineering and equipment operations Well Positioned for Growth 20
Slide 21: Management and Governance
Management and Governance Management Board of Directors Chairman Designate Blair Goertzen Chairman ─ ProspEx Resources Ltd. Stephen J. Savidant President & (Current Toromont Board Member) Director ─ Empire Company Limited CEO Former President & CEO ─ Esprit Energy Trust James and Canadian Hu
Slide 22: TOROMONT
TOROMONT
Slide 23: Complete CAT Product Line
Complete CAT Product Line New Used Rental Power Generation Product Support Clear Market Leader representing Industry’s Strongest Brand 23
Slide 24: Comprehensive Rental Solutions
Comprehensive Rental Solutions 24
Slide 25: Clear Market Leader in Industrial and Recreational Refrigeration
Clear Market Leader in Industrial and Recreational Refrigeration AR AL Canadian Market Leader with Worldwide Growth Opportunities 25
Slide 26: Revenue
Revenue PRODUCT SUPPORT EQUIPMENT 34% Power 53% Generation Cimco 1% Battlefield 8% General 2% Construction Cat 24% 38% Other 35% Cat 24% Infrastructure 26% Mining 15% Battlefield Battlefield 9% Cat Cimco 5% RENTAL 4% 9% 13% 2009 2009 Equipment Group by by Division Industry Diversified by Division, I
Slide 27: Growing Order Bookings and Backlog
Growing Order Bookings and Backlog New Toromont (Pro Forma) ($ millions) 350 300 250 200 150 100 50 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2007 2008 2009 2010 Backlog Bookings Early Stages of Industry Recovery 27
Slide 28: Ontario: Largest and Fastest Growing Mine Exploration Region in Canada
Ontario: Largest and Fastest Growing Mine Exploration Region in Canada Canadian Exploration Expenditures (1) 45% 44% Ontario Ontario 23% 30% Newfoundland & Labrador Manitoba Newfoundland & Labrador Nunavut Manitoba Nunavut 2005 $1.3 Billion 2010 $2.8 Billion Source: Natural Resources Canada Ontario’
Slide 29: Remote Mine Partnerships
Remote Mine Partnerships Cat Mine Sites 1. Agnico Eagle 2. Goldcorp Mining Sales 3. DeBeers ($ Millions) Nunavut 4. Detour Gold 5. Goldcorp 1 6. Vale Inco Baker Lake 166 181 6 Voisey’s Bay Newfoundland 130 107 94 Musselwhite 3 67 2 Victor Detour Lake 4 Porcupine 5 71 60 51 57 Ontario 13 15 2005 2006
Slide 30: Power Systems Group
Power Systems Group Commercial Truck Industrial Electric Power Marine Data centres Mining Lift trucks Aggregate Farm equipment Telecom Welding trucks Financial (pic) institutions (pic) Engine sales Prime Power, Peak Retrofit to Great Engine repair to OEMs Shaving, Stand-by Lake Fleets parts & servic
Slide 31: Broaden Product Offering and Services Strategy
Broaden Product Offering and Services Strategy Trimble Metso CAT Announces MWM Machine guidance Mobile and stationary Bucyrus Acquisition aggregate crushing and Sustainable Power control systems Generation Solutions Broader mining equipment screening product line 2005 2006 2007 2008 2009 2010 2011 H
Slide 32: Management and Governance
Management and Governance Management Board of Directors Robert Ogilvie Robert M. Ogilvie Chairman & CEO ─ Toromont Industries Ltd. Chairman & CEO President ─ Signalta Capital Corporation Robert M. Franklin Director ─ Barrick Gold Corporation, Canadian Paul Jewer Tire Corporation, Previous Chai
Slide 33: Summary Highlights
Summary Highlights Leading Market Positions Positive Long-term Industry Fundamentals Strong Track Record of Growth and Profitability Attractive Growth Opportunities Strong Management Teams with Strategic Focus Creating Two Market Leaders 33
Slide 34: Creating Two Market Leaders
TOROMONT Creating Two Market Leaders
Toromont Industries — Merger or Acquisition (November 2010) on 6ix