National Energy Services Reunited Corp · NASDAQ:NESR
National Energy Services Reunited — J.P. Morgan 2020 Virtual Energy, Power & Renewables Conference
21 slides from National Energy Services Reunited's conference presentation, Jun 16, 2020
Slide 1: National Energy Services Reunited Corp. The National Champion of MENA
NEED TO ADD DIVERSITY PIC National Energy Services Reunited Corp. The National Champion of MENA J.P. Morgan 2020 Virtual Energy, Power & Renewables Conference - June 16, 2020 Sherif Foda Chairman and Chief Executive Officer
Slide 2: Safe Harbor and Other Disclaimers
Safe Harbor and Other Disclaimers This presentation (the “Presentation”) is for informational purposes only and does not constitute an offer to sell, a solicitation of an offer to buy, or a recommendation to purchase any equity, debt or other financial instruments of National Energy Services Reunite
Slide 3: NESR – Paradigm Shift for the Region
NESR – Paradigm Shift for the Region |3 Strictly confidential – Do not reproduce or distribute Copyright NESR Corp.
Slide 4: NESR – Largest Indigenous OFS in the Region
NESR – Largest Indigenous OFS in the Region Iraq Bahrain UAE ▪ Head office in Houston and regional offices across MENA and Asia Pacific ▪ Operations Bases: 15 Countries Egypt ▪ 5,000+ Employees USA Algeria Libya ▪ 20 Product Lines India Chad Saudi Arabia ▪ Clients Portfolio: 30+ Customers Malaysia I
Slide 5: COVID-19 Response
COVID-19 Response Maintained 100% operational capacity and customer first approach while ensuring personnel wellbeing ▪ Crisis Management Team (CMT) formed early in the cycle along with country Emergency Response Teams (ERT) Government ▪ Coordination with Customers and Local authorities Operations S
Slide 6: Middle East – The Strongest Activity Region
Middle East – The Strongest Activity Region The region has the capacity and ability ME Region - From potentially 8% expected growth to -13% As of now in terms of effect on reducing budgets - Downstream, Drilling and then Production in order of decreasing magnitude |6 Strictly confidential – Do not r
Slide 7: The Big Story for Each Country
The Big Story for Each Country |7 Strictly confidential – Do not reproduce or distribute Copyright NESR Corp.
Slide 8: North Africa Macro
North Africa Macro |8 Strictly confidential – Do not reproduce or distribute Copyright NESR Corp.
Slide 9: Unconventionals – A First for a Local Company
Unconventionals – A First for a Local Company ▪ Proposal to execution < 1yr ▪ Project management and 24-hour operations ▪ Sites & Camp (Pre-Frac, During Frac and in Flowback phase), Frac, Testing, SMS and Flowback, WL, Plugs, Coil, Slickline, Milling, Proppant, Chemicals, Water, Wellheads, Explosive
Slide 10: …and then to Conventionals
…and then to Conventionals ▪ Been done in the region for over two decades; primarily Acid Fracs ▪ Asset light model and leverage existing strategic partnerships ▪ 100% manned by NESR Nationals ▪ Smaller HHP fleet compared to Unconventionals, different operating methodology (more data, less stages pe
Slide 11: SAPESCO Acquisition
SAPESCO Acquisition ▪ Oldest oilfield service company in the region ▪ Transaction effective from June 1, 2020 ▪ Egypt ~ 1 B$ OFS Market, NESR does not exist in Egypt ▪ Addition of Industrial Cleaning (pipeline maintenance) product line which can be expanded to other NESR markets ▪ Non-overlapping pr
Slide 12: ESG & ICV at NESR
ESG & ICV at NESR | 12 Strictly confidential – Do not reproduce or distribute Copyright NESR Corp.
Slide 13: Employee Engagement and Corporate Giving
Employee Engagement and Corporate Giving ▪ 14 Community Involvement Teams (CIT) in the major countries ▪ Target approximately 5000 hours a year for community volunteering across the Company ▪ Donated to the Health Endowment Fund of the Saudi Arabian Ministry of Health to help fight the spread of COV
Slide 14: Diversity and Inclusion
Diversity and Inclusion ▪ Gender Diversity Targets ▪ WIN (Women In NESR) Initiative ▪ More than 60 nationalities ▪ Localization/Nationalization Targets and Initiatives ▪ Engagement on D&I with communities, clients and partners | 14 Strictly confidential – Do not reproduce or distribute Copyright NES
Slide 15: NESR - The Undervalued Growth Story
NESR - The Undervalued Growth Story | 15 Strictly confidential – Do not reproduce or distribute Copyright NESR Corp.
Slide 16: Exceptional and Unmatched Growth
Exceptional and Unmatched Growth Growth in the worst downturn in 25 years 800 777 700 658 600 553 500 458 415 431 400 369 328 300 186 195 200 147 162 129 141 104 111 100 0 2013 2014 2015 2016 2017 2018 2019 2020 Analyst Revenue ($mm) Adjusted EBITDA ($mm) | 16 NPS financial results for 2013, 2014 ar
Slide 17: and Significant Upside Potential
and Significant Upside Potential TEV/EBITDA 2020E TEV/EBITDA 2021E (27%) (45%) (27%) (21%) (41%) 18% YOY Rev Growth* (10%) (6%) (8%) (2%) (24%) 14% 23.6x 21.3x 20.4x 17.1x 14.9x Significant Significant valuation 11.7x valuation 10.8x upside upside 8.6x 8.5x potential 7.7x potential 4.5x 3.8x Equipme
Slide 18: National Energy Services Reunited Corp. The first Nasdaq listed company from MENA
NEED TO ADD DIVERSITY PIC National Energy Services Reunited Corp. The first Nasdaq listed company from MENA J.P. Morgan 2020 Virtual Energy, Power & Renewables Conference - June 16, 2020 Sherif Foda Chairman and Chief Executive Officer
Slide 19: 2020 Adjusted EBITDA by Quarter
2020 Adjusted EBITDA by Quarter (Non-GAAP reconciliation) NESR ($million) Q1 2020 Revenue 199.3 Net income (loss) 11.4 Depreciation and amortization 30.8 Finance Cost 4.5 Tax 2.5 Transaction, Integration & Start-Up Costs 1.7 Other Provisions - Adjusted EBITDA 50.9 Source: Company financial informati
Slide 20: 2018/2019 Adjusted EBITDA
2018/2019 Adjusted EBITDA (Non-GAAP reconciliation) NESR ($million) 2019 2018 (1) Revenue 658.4 552.5 Net income (loss) 39.4 39.5 Depreciation and amortization 93.8 69.5 Finance cost 19.0 19.5 Tax 13.1 13.1 Charges & credits 20.7 20.1 Adjusted EBITDA 186.0 161.7 | 20 (1) Successor and Predecessor Co
Slide 21: Historical Adjusted EBITDA
Historical Adjusted EBITDA (Non-GAAP reconciliation) Adjusted EBITDA NPS financial results for 2013, 2014 are prepared under IFRS, and 2015-2017 are prepared under US GAAP; GES 2013-2017 financial results are prepared under IFRS. EBITDA is adjusted for impairment, which is not recognized as part of