28 slides from Cactus, Inc. Class A Common Stock's investor presentation, March 2023
Slide 1: Investor Presentation
slnvestor Presentation Gactus, Inc: (NYSENWI Mareh 2023
Slide 2: Important Disclosures
Important Disclosures Non-GAAP Measures This presentation includes references to EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, and EBIT, which are not measures calculated in accordance with accounting principles generally accepted in the United States of America (“GAAP”). A reconciliation of EBIT
Slide 3: Experienced Executive Team
Experienced Executive Team ◼ Mr. Bender has served as President and CEO since co-founding Cactus Wellhead, LLC (“Cactus LLC”) in 2011. ◼ Mr. Bender previously was President of Wood Group Pressure Control from 2000 to 2011. Scott Bender ◼ Mr. Bender successfully built and monetized Ingram Cactus Comp
Slide 4: Investment Highlights
Investment Highlights A Leading Pure Play Equipment Solutions Provider 1 for Onshore Markets Innovative and Differentiated Products & Services 2 that Sustain Relative Margin Resilience 3 Dynamic Operating and Manufacturing Capabilities Through-Cycle Outperformance 4 Strong Margins and Free Cash Flow
Slide 5: Products & Operations Overview
Products & Operations Overview Cactus designs, manufactures, sells and rents highly engineered products which generate improved drilling, completion and production efficiencies while enhancing safety Cactus Provides Service, 33.4% Margin 37.1% Margin Installation & Maintenance for its Wellhead syste
Slide 6: Historical Financial Overview (Excluding FlexSteel)
Historical Financial Overview (Excluding FlexSteel) 2022 Revenue by Type Revenue ($ in millions) $628 $688 $544 Field Service $439 and $341 $349 Other 20% Rental 14% Product 66% 2017 2018 2019 2020 2021 2022 Adjusted EBITDA(1) ($ in millions) 37.1% 33.4% Margin Margin $229 $228 $213 Selected Active
Slide 7: Market Leader with Strong Wellhead Market Share
Market Leader with Strong Wellhead Market Share Historical U.S. Onshore Wellhead Market Share(1) 41.0% 0.8% Dec 2011 Dec 2022 Cactus U.S. 15 311 Onshore Rigs Followed Significant U.S. Market Share Gains Source: Baker Hughes Rig Count Data, as published on the Friday on or immediately preceding the 1
Slide 8: Differentiated Margin Profile Through the Cycle
Differentiated Margin Profile Through the Cycle Total Adjusted EBITDA Margin (2014 – 2022) (1)(2) 2022 Adjusted EBITDA Margin (1)(2) 33% 33% 25% 21% 17% 16% 15% 13% 13% 12% 10% 10% 9% 8% Peer A Peer B Peer C Peer D Peer E Peer F Peer C Peer A Peer D Peer F Peer E Peer B Strength of margin profile re
Slide 9: Technologically Advanced Pad Drilling Wellhead Systems
Technologically Advanced Pad Drilling Wellhead Systems Cactus SafeDrill® SafeDrill® Advantages Safety Time Savings Fewer trips into Eliminates time confined space (cellar) consuming BOP - manipulation No BOP manipulation No waiting on cement after intermediate after running casing casing has
Slide 10: Technologically Advanced Spoolable Pipe Systems
Technologically Advanced Spoolable Pipe Systems FlexSteel Spoolable Pipe FlexSteel Advantages Features Operator Savings Durable and corrosion- Lower maintenance cost resistant for operators Faster installation times Lower cost to install Withstands cyclic Reduced operating field loading
Slide 11: Spoolable Pipe Applications Across the Industry Value Chain
Spoolable Pipe Applications Across the Industry Value Chain Production Lines / Pipe-Under-Pad Gathering Lines Takeaway Lines Wellhead Tank Battery Midstream Sales Refining / End Use Meter Multiphase Production Oil / Gas / Water Oil / Gas / Water Gas Lift / CO2 CO2 / CCUS CO2 / CCUS Customer E&P E&P
Slide 12: Differentiated Offerings Enable Customers to Meet ESG-Related Goals
Differentiated Offerings Enable Customers to Meet ESG-Related Goals Faster Safer Cleaner ◼ Equipment takes less time to ◼ Equipment increases employee ◼ Switching from diesel to solar install versus legacy offerings safety powered generation in certain ◼ Enables customers to drill, ◼ Automation of h
Slide 13: North American Operating Footprint
North American Operating Footprint Operational Footprint ◼ Headquarters located in Houston, TX ◼ U.S. manufacturing facilities located in Bossier City, LA and Baytown, TX ◼ Significant overlap in Cactus and FlexSteel service centers & yards ◼ Service centers support field operations and provide repa
Slide 14: Global Operating Footprint
Global Operating Footprint Global Operations ◼ Manufacturing facility located in China ◼ Established legacy business in Australia ◼ Cactus started to provide rental equipment in the Middle East in late 2021 ◼ Approved as vendor in key Middle East markets ◼ First wellhead/production tree sales in Mid
Slide 15: A Dynamic Manufacturing Advantage; Responsive, Scalable and Low Cost
A Dynamic Manufacturing Advantage; Responsive, Scalable and Low Cost Bossier City Facility Suzhou Facility Baytown Facility ◼ Rapid-response manufacturing ◼ Less time-sensitive, high-volume ◼ Produces 100% of FlexSteel wellhead equipment equipment ◼ 5-axis computer numerically controlled machines ◼
Slide 16: Experienced and Well Aligned Management Team with Strong Industry Relationships
Experienced and Well Aligned Management Team with Strong Industry Relationships ◼ Management is well incentivized as it owns over 19% of the business ◼ Performance-based stock compensation tied to Return on Capital Employed (“ROCE”) ◼ Management team has built the foundation of this company over mor
Slide 17: Returns & Margins Have Outperformed Peers
Returns & Margins Have Outperformed Peers 2022 Adjusted EBITDA Margin (%) 40.0% (1) 30.0% NCSM SBO 20.0% FTI OIS WEIR NOV FET HTG 10.0% ROCE(2) 0.0% DRQ (2017 – 2022) (%) (10.0%) 0.0% 10.0% 20.0% 30.0% 40.0% Source: Company filings and Factset. Note: Adj. EBITDA Margins based on latest publicly avai
Slide 18: Execution Has Driven Equity Outperformance
Execution Has Driven Equity Outperformance Share Price Performance of Cactus vs. the OSX since IPO 102% 0% (48%) WHD OSX Share Price Outperformed the OSX in 4 of 5 years since IPO Note: Data based on share price performance from 2/7/2018 to 3/16/2023.Cactus 2/7/2018 price set as IPO price of $19 per
Slide 19: Steadily Increasing Return of Capital Profile
Steadily Increasing Return of Capital Profile Cactus’ Dividends & Associated Distributions to Members Paid Since 2018 ($ in millions) $40 $30 $20 $10 $- (1) 2018 2019 2020 2021 2022 Cactus Has Increased Shareholder Returns in Every Year Since Going Public Source: Company filings and annual reports.
Slide 20: Multiple Avenues of Growth for Spoolable Technologies
Multiple Avenues of Growth for Spoolable Technologies ◼ Growth In Core Production Products ◼ Transition from legacy offerings to spoolable technologies still underway ◼ Increase customer penetration for larger-diameter gathering-based technologies ◼ Expand customer penetration for on-pad application
Slide 21: Strong Balance Sheet & Low Capital Intensity
Strong Balance Sheet & Low Capital Intensity Balance Sheet & Capital Summary Adjusted EBITDA – Net Capital Expenditures ($ in millions)(1)(2) ◼ Net debt of approximately $100 million post FlexSteel acquisition closing(1) $202 $173 ◼ Full year 2023 net capital expenditure guidance $144 of $35 to $45
Slide 22: First Quarter Financial Outlook
First Quarter Financial Outlook Outlook & Recent Developments ◼ Q1 2023 U.S. land rigs followed(1) expected to be up approximately 5% versus Q4 2022 ◼ Cactus achieved record rigs followed as of mid- March 2023 ◼ Q1 2023 Product revenues expected to increase approximately 5% sequentially ◼ Q1 2023 Re
Slide 23: Cactus Is Committed to ESG
Cactus Is Committed to ESG Environmental Social ◼ Cactus, Inc. is committed to reducing its and its industry’s impact on the ◼ Cactus, Inc. is dedicated to improving lives of our employees and the communities environment. We will continue to strive to improve our products over time and to where they
Slide 24: Appendix
Appendix /
Slide 25: Company Organizational Structure
Company Organizational Structure Company Profile Organizational Structure(1) Ticker WHD (NYSE) Class A Shares Outstanding(1) 64mm CC Unit Public Class B Shares Outstanding(1) 15mm Holders Investors Total Shares Outstanding(1) 79mm Market Capitalization(2) ~$3.0bn Class B Common Stock Class A Common
Slide 26: FlexSteel Met Cactus' Acquisition Criteria
FlexSteel Met Cactus’ Acquisition Criteria Manufacturer of a Unique Highly Engineered Product Products Sold Directly to End-Users Variable Cost Business With A Strong Margin Profile Modest Capital Requirements Enhance Free Cash Flow Leverages Cactus’ Infrastructure & Customer Base Attractive Growth
Slide 27: Non-GAAP Reconciliation
Non-GAAP Reconciliation Important Disclosure Regarding Non-GAAP Measures EBITDA and Adjusted EBITDA are not measures calculated in accordance with GAAP. EBITDA and Adjusted EBITDA are supplemental non-GAAP financial measures that are used by management and external users of our consolidated financia
Slide 28: Investor Relations Contact
Investor Relations Contact John Fitzgerald Director of Corporate Development & Investor Relations 713-904-4655 IR@CactusWHD.com 28