Cactus, Inc. Class A Common Stock · NYSE:WHD
Cactus, Inc. Class A Common Stock — Investor Presentation (March 2022)
30 slides from Cactus, Inc. Class A Common Stock's investor presentation, Mar 22, 2022
Slide 1: Investor Presentation
Exhibit 99.1 Investor, Presentation )Gactus; Inc. (NYSES WH March. 2022
Slide 2: Non-GAAP Measures and Forward-Looking Statements
2 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 EBITDA, Adjusted EBITDA
Slide 3: Management team biographies
3 ◼ 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. ◼ Mr. Bender successfully built and monetized Ingram Cactus Company (sold to Cameron in 1996) and led
Slide 4: Investment Highlights
4 Experienced Management Team with Significant Equity Ownership & Strong Industry Relationships Innovative and Differentiated Products & Services that Sustain Relative Margin Resilience A Leading Pure Play Pressure Control Equipment Solutions Provider for Onshore Markets Returns Focused with Large N
Slide 5: Company Overview
5 32.9% 39.1% 36.4% 34.7% 27.4% 28.2% Product 64% Rental 14% Field Service and Other 22% $341.2 $544.1 $628.4 $348.6 $438.6 $519.7 2017 2018 2019 2020 2021 4Q 2021 Ann. Revenue ($ in millions)2021 Revenue by Type ◼ Bakken ◼ Eagle Ford ◼ Permian ◼ Uinta Company Overview *Product Revenue Includes Dril
Slide 6: Proprietary Equipment Across Drilling, Completion, and Production Phases of a Well
6 Proprietary Equipment Across Drilling, Completion, and Production Phases of a Well ◼ Designed for pad drilling and intense completion environments ◼ Principal products: SafeDrill® wellheads, frac related rentals and production trees ◼ Time savings can exceed 30 hours of rig time per well Drilling
Slide 7: Cactus Rigs Followed and Historical U.S. Onshore Market Share
7 1,931 1,814 1,699 1,800 755 495 853 1,011 918 417 463 15 61 110 169 109 99 211 272 270 145 193 0.8% 3.4% 6.4% 9.4% 14.4% 19.9% 24.8% 26.9% 29.5% 34.8% 41.8% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 0 50 100 150 200 250 300 350 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Slide 8: Differentiated Margin Profile Through the Cycle
8 27% 18% 15% 9% 8% 7% 5% 4% Peer A Peer C Peer G Peer D Peer E Peer B Peer F 33% 26% 22% 18% 14% 13% 13% 13% Peer A Peer B Peer C Peer D Peer E Peer F Peer G Differentiated Margin Profile Through the Cycle Total Adjusted EBITDA Margin (2014 – 2021) (1)(2) Source: Factset, Company filings. 1) Peer d
Slide 9: Technologically Advanced Pad Drilling Wellhead Systems
9 Technologically Advanced Pad Drilling Wellhead Systems SafeDrill® Advantages Eliminates time consuming BOP manipulation No waiting on cement after running casing strings - Mandrel hangers, pack offs run and set through BOPs Fewer trips into confined space (cellar) - No BOP manipulation after
Slide 10: Favorable Macro Trends Benefit Cactus
10 Average Active U.S. Onshore Rigs(1) Total U.S. Onshore Wells Drilled(1) 1. Source: Spears and Associates. 419 460 700 811 2020A 2021A 2022E 2023E 12,898 16,794 19,284 21,683 2020A 2021A 2022E 2023E Favorable Macro Trends Benefit Cactus ◼ Recovery in energy demand driving increased need for oil &
Slide 11: Innovations Enhance Rental Business Value Proposition
11 ◼ SafeInject® ◼ Digital & remotely operated method to perform frac tree maintenance and collect valuable data at wellsite ◼ SafeClamp® ◼ Reliable method to connect the wireline lubricator to the frac tree without the need for human intervention within the exclusion zone Innovations Enhance Rental
Slide 12: Differentiated Offerings Enable Customers to Meet ESG-Related Goals
12 Differentiated Offerings Enable Customers to Meet ESG-Related Goals ◼ Cactus enables customers to drill and complete wells faster ◼ Translates to fewer rig and frac days & associated equipment ◼ Lower operator emissions per barrel of production ◼ Reduced carbon intensity per well ◼ Fewer drilling
Slide 13: Small Expenditures Can Have a Big Impact on Operators
13 Small Expenditures Can Have a Big Impact on Operators Components of Onshore Well Costs(1) ◼ Cactus offerings make up a relatively small portion of the overall cost to drill & complete a well ◼ Efficiency and reliability can cause a disproportionate amount of benefit for operators ◼ Operators prio
Slide 14: Flexible and Scalable Operating Footprint
14 Bossier City, Louisiana Manufacturing Facility ◼ Service centers support field services and provide repair services ◼ Spread across all key producing basins ◼ Flexible cost structure at branches & Bossier City ◼ Ability to scale costs and right-size in real-time ◼ Minimal maintenance capex requir
Slide 15: A Dynamic Manufacturing Advantage
15 Responsive manufacturing in the U.S. supplemented by high volume production in China Bossier City Facility Suzhou Facility ◼ Rapid-response manufacturing of equipment ◼ 5-axis computer numerically controlled machines ◼ “Just-in-time” product capabilities allow Cactus to offer fast delivery time f
Slide 16: Management ownership and track record
16 Current ◼ Management is well incentivized as it owns approximately 20% of the business ◼ Over 80% of executive compensation deemed “at risk” ◼ Performance-based stock compensation tied to Return on Capital Employed (“ROCE”) ◼ Management team has built the foundation of this company over four deca
Slide 17: Well Established Relationships With High-Quality Customer Base
17 2021 Total Revenue by Customer Type 2021 Rental Revenue by Customer Type Majority of customer base represented by larger, well capitalized operators 2021 Product Revenue by Customer Type Note: Cactus’ Field Service revenue driven by the Company’s Product & Rental activity. Large E&P represents ex
Slide 18: Recent Success With Private Operators
18 20 17 29 42 62 72 79 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Cactus’ U.S. Onshore Rigs Followed (Private Operators)(1) Cactus’ Onshore Rigs Followed with Private Operators Has More Than Quadrupled Since Mid-2020 Note: Private operators are firms that are not listed on a publicly t
Slide 19: Margins and ROCE versus peers
19 FTI DRQ WEIR NCSM SBO OIS HTG FET NOV 0.0% 10.0% 20.0% 30.0% 40.0% (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 available annual data. Cactus’ computation of Adjusted EBITDA may not be comparable to other similarly ti
Slide 20: Execution Has Driven Equity Outperformance
20 167% (49%) WHD OSX Share Price Performance of Cactus vs. the OSX since IPO Note: Data based on share price performance from 2/7/2018 to 3/17/2022.Cactus 2/7/2018 price set as IPO price of $19 per share. Source: Factset Share Price Outperformed the OSX in 2018, 2019, 2020 and 2021 Execution Has Dr
Slide 21: Cactus Has Recorded Zero Impairment Charges Through the Cycle
21 Goodwill, Intangible, Long-Lived & Other Asset Impairment Expenses ($mm) (2015 – 2021) Note: Peers include: ChampionX, Dril-Quip, Core Labratories, DMC Global, National Oilwell Varco, Oil States International and TechnipFMC. ChampionX data represents legacy Apergy prior to merger. TechnipFMC fina
Slide 22: Balance Sheet & Capital Summary
22 $17.4 $30.7 $68.2 $55.9 $18.1 $11.6 2016 2017 2018 2019 2020 2021 $14.8 $81.4 $144.4 $173.1 $102.9 $108.7 2016 2017 2018 2019 2020 2021 ◼ Year-end 2021 cash balance of approximately $302 million ◼ Full year 2022 net capital expenditure guidance of $20 million to $30 million ◼ Modest maintenance c
Slide 23: Recent Performance & Outlook
23 ◼ Revenues up 13% sequentially ◼ Product market share(1) of 42% ◼ Adjusted EBITDA margin(2) increased to approximately 28% Fourth Quarter 2021 Performance Outlook & Recent Developments ◼ Q1 2022 Product revenues expected to be up at least 5% sequentially ◼ Rigs followed expected to be up at least
Slide 24: Significant Growth Potential Through Geographic Expansion
24 24% 76% U.S. & Australia Rest-of-World Percentage of 2021 Global Rig Count (Excluding Russia & Central Asia) Source: Company estimates. Spears & Associates. 1. Excludes rigs in Russia and Central Asia. Significant Growth Potential Through Geographic Expansion Cactus has not yet sold into regions
Slide 25: Environmental, Social and Governance
25 3 4 5 6 7 At IPO Current Independent Directors Environmental Social Governance ◼ Cactus, Inc. is committed to reducing its impact on the environment. We will continue to strive to improve our environmental performance over time and to initiate projects and activities that will further reduce our
Slide 26: Appendix
Appendix
Slide 27: Ownership Profile and Organizational Structure
27 Public Float 79% Management & Employees 21% Ownership Profile(4) Company Organizational Structure Source: Company filings. 1. As of March 15, 2022. Excludes effect of dilutive securities. 2. As of March 17, 2022. Market capitalization utilizes total shares outstanding. 3. As of December 31, 2021.
Slide 28: Products and services across the well lifecycle
28 1 ▪ Wellheads are required by each well over production life ▪ One of the first pieces of equipment to be installed ▪ Cactus wellheads installed below surface ▪ Production trees installed on the wellhead after the frac stacks are removed Product Sold1 ▪ Frac stacks are connected to the wellhead f
Slide 29: EBITDA and Adjusted EBITDA reconciliation
29 Annualized Year Ended Three Months Ended Three Months Ended ($ in thousands) December 31, December 31, December 31, 2021 2020 2019 2018 2017 2016 2015 2021 2021 Net income (loss) $67,470 $59,215 $156,303 $150,281 $66,547 ($8,176) $21,224 $81,532 $20,383 Interest (income) expense, net 774 (701) (8
Slide 30: Investor Relations Contact
30 John Fitzgerald Director of Corporate Development & Investor Relations 713-904-4655 IR@CactusWHD.com Investor Relations Contact