Slide 1: Matrix Service Investor Presentation June 2003
JUNE 2003 MATRIX SERVICE INDUSTRIAL SERVICE CONTRACTOR INVESTOR PRESENTATION
Slide 2: Forward-Looking Statement
MATRIX SERVICE FORWARD-LOOKING INDUSTRIAL SERVICE CONTRACTOR STATEMENT This presentation contains certain forward-looking statements concerning Matrix Service Company's operations, economic performance and management's best judgement as to what may occur in the future. The actual results for the cur
Slide 3: Matrix Service Company Timeline
vvvVVv how NOPE ¥. v MATRIX SERVICE COMPANY INDUSTRIAL SERVICE CONTRACTOR TIMELINE April 1984 » Founded in Tulsa, Oklahoma September 1990 » Initial Public Offering December 1992 » Acquired Colt Construction Co. — Bellingham, Washington June 1993 » Acquired Heath Engineering Co. Ltd. — Sarnia, Ontari
Slide 4: Geographic Locations
MATRIX SERVICE GEOGRAPHIC INDUSTRIAL SERVICE CONTRACTOR LOCATIONS Pages
Slide 5: Core Values
MATRIX SERVICE INDUSTRIAL SERVICE CONTRACTOR CORE VALUES ® Core Values » Commitment to Safety Provide a safe work environment through effective training, planning & execution >» Integrity Do the right thing every time » Positive Relationships Build positive relationships through mutual respect and c
Slide 6: Operating Segments, Products & Services
MATRIX SERVICE INDUSTRIAL SERVICE CONTRACTOR OPERATING SEGMENTS PRODUCTS & SERVICES Aboveground Storage Tank (AST) Services ° oooe Tank Construction Tank Repair & Maintenance Power Work Fabrication Products > Allentech > Environmental Protection Services (EPS) Plant Services @ Plant Maintenance @ Re
Slide 7: Customer Base
MATRIX SERVICE INDUSTRIAL SERVICE CONTRACTOR CUSTOMER BASE Major Integrated Oil Companies Independent Refineries and Marketers Marketing and Pipeline Terminals Petrochemical Companies Power Manufacturing Plants and Facilities Pulp and Paper Agricultural/Fertilizer Industries Page 7
Slide 8: Strategic Relationships
TRIX SERVICE INDUSTRIAL SERVICE CONTRACTOR STRATEGIC RELATIONSHIPS Currently we have a strategic relationship, of some degree, with each of the following companies: ¢¢ @ @ British Petroleum/Amoco/Arco Chevron Colonial Pipeline Exxon/Mobil he MAP Sun These strategic relationships allow us to: » Reduc
Slide 9: Market Overview
MATRIX SERVICE MARKET INDUSTRIAL SERVICE CONTRACTOR OVERVIEW American Petroleum Institute Estimates Approximately 700,000 Aboveground Storage Tanks in the U.S. Industry Estimates That $100-200 Million Per Refinery Needed in Capital Improvements Over Next 3-5 Years to Meet EPA’s Clean Fuel Requiremen
Slide 10: Petroleum Industry Trends
TRIX SERVICE PETROLEUM Bh INDUSTRIAL SERVICE CONTRACTOR INDUSTRY TRENDS ¢¢ ¢ @ Consolidation of Downstream Facilities Major Personnel Reduction Through Staff Cutbacks, Early Retirement, and Attrition Has Led to More Maintenance & Repair Work Being Outsourced Bundled Services » Reduction in Quantity
Slide 11: Safety Performance
8 TRIX SERVICE SAFETY INDUSTRIAL SERVICE CONTRACTOR PERFORMANCE ¢@ The foundation of Matrix’s safety culture is communication, accountability and training. ¢@ Safety Accountability Program holds all levels of operations management accountable for safety performance. @ OSHA Recordable Rate is consist
Slide 12: Competitive Advantages
MATRIX SERVICE COMPETITIVE INDUSTRIAL SERVICE CONTRACTOR ADVANTAGES Broad Geographic, Operational & Fabrication Base within the U.S. Emerging as Domestic Industry Leading Provider of Tank Construction, Repair and Maintenance Services Full-Service Provider » Commitment to Safety with Established In-h
Slide 13: Competition
MATRIX SERVICE INDUSTRIAL SERVICE CONTRACTOR COMPETITION ¢ Tank Repair/Maintenance and Products » National/international Companies (Chicago Bridge & Iron/Pitt-Des Moines, Inc.) » Small Local or Regional Companies (Tanco, Tarsco, HMT, Consolidated) ¢ Tank Construction » National/international Compani
Slide 14: Management
MATRIX SERVICE INDUSTRIAL SERVICE CONTRACTOR MANAGEMENT Management Title Years in Industry Bradley S. Vetal Michael J. Hall George L. Austi Vance R. Davis John S, Newmeister Bradley J. Rinehart Glen W. Rogers James P. Ryan President, CEO and Director ice President Finance, CFO and Director ice Presi
Slide 15: Long-Term Objectives
SE3 MarAIx seRviCE sisi INDUSTRIAL SERVICE CONTRACTOR OBJECTIVES Long-Term Objectives ¢@ Grow Matrix to at least a $850 Million Company by May 2008 @ Achieve a Pre-Tax Pre-Interest Profit Margin of 7% @ Seek Accretive, Strategic Acqui Business ions to Enhance Core Page
Slide 16: Strategies
TRIX SERVICE Bh INDUSTRIAL SERVICE CONTRACTOR STRATEGIES Strategies @ Maintain Emphasis on Margins @ Implement Strategic Internal Growth Plans for Each Segment > Capitalize on the added capabilities and relationships resulting from the Hake acquisition. = Expand Plant Services Geographically =™ Incr
Slide 17: Strategies, continued
8 TRIX SERVICE STRATEGIES INDUSTRIAL SERVICE CONTRACTOR continued => Grow with the Market for Tank Repair & Maintenance = Focus Construction Services on Capital Spending of Core Client Base = Pursue Opportunities in Power Sector @ Train and Recruit Personnel to Facilitate Internal Growth @ Continue
Slide 18: Acquisition Strategy
eo © © © TRIX SERVICE ACQUISITION Bh INDUSTRIAL SERVICE CONTRACTOR STRATEGY Must complement core business. Immediately accretive to earnings. Of sufficient size (no one man shows). Shares our core values and has a similar culture. Not a consolidator or a liquidator. Bigger isn’t always better. We vi
Slide 19: Investment Opportunity
MATRIX SERVICE INVESTMENT INDUSTRIAL SERVICE CONTRACTOR OPPORTUNITY Hake was an attractive investment opportunity for a number of reasons: Outstanding revenue growth supported by valuable contracts in place and significant opportunities for continued expansion. @ Unique and unparalleled contracting
Slide 20: Financial Highlights
FINANCIAL HIGHLIGHTS MATRIX SERVICE INDUSTRIAL SERVICE CONTRACTOR Page
Slide 21: Historical Yearly Data
MATRIX SERVICE INDUSTRIAL SERVICE CONTRACTOR HISTORICAL YEARLY DATA Amounts in mil ions (except per share data) 2002 2008 2000 7999 1998 Total Total Total Total Total Consolidated Revenues $222.5 $190.9 $193 Ca $211 o® $225. re Gross Profit 25.3 226 205 140 186 Gross Margin 11.4% 118% 106% 6.6% 8.2%
Slide 22: Operating Results - Year Ended
MATRIX SERVICE OPERATING INDUSTRIAL SERVICE CONTRACTOR RESULTS - YEAR ENDED {8 in 000's except per share data) Year Ended May 31, 2002 AST Construction Plant Exited © Total Senices Sewices Services Total _Onevations Consolidated Gross reverues $1668800 § 26,800 § 30,900 $224,500 § 224,500 Less Inter
Slide 23: Nine Months Operating Results
MATRIX SERVICE INDUSTRIAL SERVICE CONTRACTOR NINE MONTHS OPERATING RESULTS (Sin 00s except per share data) Nine Months Ended February 28, 2003, AST Construction Plant Total Services Services Services Consolidated Gross revenues § 123400 § 29,100 § 14,200 § 166,700 Less inter-segment revenues 2,200)
Slide 24: Balance Sheet
MATRIX SERVICE INDUSTRIAL SERVICE CONTRACTOR BALANCE SHEET ASSETS (00'S) February 28, 2003 LIABILITIES & EQUITY (00'S) Total current assets Property, plant & equipment Less accumulated depreciation Net Goodwill Other assets Total assets $45,844 $69,720 $27,956 $41,764 $10,981 Total current liabiliti
Slide 25: Cash Flow
MATRIX SERVICE INDUSTRIAL SERVICE CONTRACTOR CASH FLOW Nine Months Ended Twelve Months Ended February 28 May 31 (8000's) 2003 2002 2002 2001 2000 Net Income $4528 $ 4029 $ 5881 $ 4.580 $ 6.616 Tax expense 2,554 2,483 3,607 2,480 580 Interest expense - net 195 141 218 230 291 Depreciation A777 3,448
Slide 26: The Hake Group
| THE HAKE GROUP RIX SERVICE COMPANY
Slide 27: History
E THE HAKE GROUP [A MATRIX SERVICE COMPANY History Through strategic acquisitions and new and expanded customer relationships, Hake has evolved into a diversified, full-service contractor. ‘Acquires Nelean Co, and founds Mechanical Canstruction, FO Alan Segal and COOs Sie Laytin and Selected as gene
Slide 28: Experienced Management Team
E THE HAKE GROUP Experienced Management Team [A MATRIX SERVICE COMPANY Hake’s management team includes individuals with a variety of complementary backgrounds in finance, operations, and corporate strategy implementation that have led the Company’s transformation into a diversified, large-scale cont
Slide 29: Safety
F- THE HAKE GROUP ‘A MATRIX SERVICE COMPANY Safety Hake maintains a strong safety record as a result of the numerous safety initiatives and goals established by the Company in the past ten years. Hake's strong safety record and reputation have benefited the Company's employee recruiting and retentio
Slide 30: Customers
E THE HAKE GROUP Customers [A MATRIX SERVICE COMPANY Hake serves a variety of blue-chip customers in the power, petroleum refinery, chemical, and manufacturing industries that are attracted by the Company’s diverse set of turnkey capabilities. ‘Top Ten Customers ‘ re ae we s conn pe Stone & Webster
Slide 31: Contract Structure
F- THE HAKE GROUP ‘A MATRIX SERVICE COMPANY Contract Structure A significant portion of Hake’s revenues are derived from low-risk, strong margin cost reimbursable contracts. The majority of Hake's projects in 2002 were structured as time and material (‘T&M’) contracts, under which Hake bills custorn
Slide 32: Competitors
F- THE HAKE GROUP [A MATRIX SERVICE COMPANY Competitors Hake competes against smaller, regional contracting firms such as Nooter and J. J. White that have limited service capabilities, as well as national companies such as Bechtel, Dick Corporation, Foster Wheeler, and Alberici. + Hake competes effe
Slide 33: Facilities
/E HAKE GROUP le [A MATRIX SERVICE COMPANY Hake utilizes two cost-effective, low-overhead facilities to support its operations. Headquarters - Eddystone, PA Pipe Fabrication Facility - Holmes, PA + Hake leases its 70,000 square foot headquarters. The Company owns a 15,000 square foot state- Faciliti
Slide 34: Labor
E THE HAKE GROUP Labor ‘A MATRIX SERVICE COMPAKY Hake, as a loyal union contractor, fills the majority of its permanent and temporary skilled labor needs through local unions with a broad range of skilled labor expertise. + The Company enjoys excellent, market leading relationships with all of the u
Slide 35: Divisional Overview
E THE HAKE GROUP Divisional Overview [A MATRIX SERVICE COMPANY Hake, through its five divisions, is the only contractor in the mid-Atlantic region capable of providing turnkey mechanical, electrical, and civil contracting, heavy transportation, and rigging services. Divisional Overview (8% 0005) enn
Slide 36: Divisional Overview - Frank W. Hake, Inc.
E THE HAKE GROUP AMATAUX SERVICE COMPANY H nal Overview - Frank W. Hake, Inc. HAKE. Frank W. Hake, Inc. specializes in heavy lifting, specialty transportation, and millwrighting. « Over its 80-year history, the division has developed expertise in hauling and lifting heavy components utilizing its ex
Slide 37: Divisional Overview - Bogan, Inc.
E THE HAKE GROUP ‘A MATRIX SERVICE COMPANY Divisional Overview - Bogan, Inc. BOGAN Bogan is a versatile electrical contractor for the power, petrochemical, and manufacturing industries. + This division was founded in 1976 by James D. Hake and Jim Bogan to broaden Hake's construction capabilities + B
Slide 38: Completed Project - Reliant Liberty Generating Station
E /E HAKE GROUP AluarnoxSenvce COMPANY Completed Project - Reliant Liberty Generating Station In 2001, Hake was awarded the electrical, piping, and heavy hauling of major components for the Liberty Generating Station construction project in Eddystone, Pennsylvania. + The Liberty facility, owned by R
Slide 39: Current Project - Conectiv Bethlehem Facility
E THE HAKE GROUP ‘AMATRIX SERVICE COMPANY Current Project - Conectiv Bethlehem Facility In 2002, Hake was awarded the turnkey CT erection, electrical and instrumentation installation, and heavy hauling components of the Conectiv Bethlehem project. + Allof the Company's divisions are involved in the
Slide 40: Current Project - Dominion Fairless Energy Works
E THE HAKE GROUP ‘A MATRIX SERVICE COMPANY Current Project - Dominion Fairless Energy Works In 2002, Hake, through a joint venture with Ragnar Benson, was awarded the above- ground contract for the Dominion Fairless Energy Works power generation facility project. + Hake will provide the power piping
Slide 41: End Markets - Power Generation
E THE HAKE GROUP End Markets ‘AMATROX SERVICE COMPANY Power Generation Hake’s 150-mile operating radius in the mid-Atlantic region is among the most robust in the country in terms of demand for energy-related contracting services, insulating Hake from the slowdown in new capacity additions at the na
Slide 42: End Markets - Power Generation
E THE HAKE GROUP End Markets ‘A MATRIX SERVICE COMPANY Power Generation In addition, management estimates that projects relating to the re-powering and/or environmental upgrades of aging power facilities in the mid-Atlantic U.S. will provide a valuable pipeline of opportunities in future years. + Th
Slide 43: Divisional Overview - Mid-Atlantic Constructors, Inc.
E THE HAKE GROUP ‘A MATRIX SERVICE COMPANY i: nal Overview - Mid-Atlantic Constructors, Inc. Mid-Atlantic Constructors, Inc. (“MAC”) provides mechanical contracting services, primarily pipefitting, for new construction and maintenance projects. + MAC owns and operates a state-of-the-art fabrication
Slide 44: Divisional Overview - I&S/HSI
E THE HAKE GROUP ‘A MATRIX SERVICE COMPANY nal Overview -1&S HsI 1&S/HSI is a full-service civil/general contractor that specializes in structural steel fabrication and erection and concrete construction. + Hake leverages the civil contracting capabilities of I8.S in order to gain an advantage over
Slide 45: Divisional Overview - Mechanical Construction, Inc.
E THE HAKE GROUP ‘AMATRIX SERVICE COMPANY ional Overview - Mechanical Construction, Inc. Mechanical Construction, Inc. (“MCI”) provides boiler installation and repair services for utilities, refineries, and manufacturers. + MCI recently added HRSG erection to its list of capabilities. + MCI differen
Slide 46: Completed Project - Kvaerner Shipyard
E THE HAKE GROUP ‘A MATRIX SERVICE COMPANY Completed Project - Kvaerner Shipyard In 2001, European conglomerate Kvaerner ASA contracted Hake to install the complex foundation and rail station for Dry Dock #4 at the Kvaerner Shipyard in Philadelphia, PA. + Hake's services for the project included + C
Slide 47: Completed Project - El Paso Eagle Point Refinery
E THE HAKE GROUP ‘A MATRIX SERVICE COMPANY Completed Project - El Paso Eagle Point Refinery In 2001, Hake performed turnkey services for the Eagle Point Refinery CO2 Boiler Installation project in New Jersey. + Hake's services for the project included + Installation of four CO2 auxiliary boilers + F
Slide 48: Current Project - Florida Power & Light Marcus Hook Facility
E THE HAKE GROUP ‘AMATRIX SERVICE COMPANY Current Project - Florida Power & Light Marcus Hook Fa ty In 2002, Hake was awarded the turnkey combustion and steam turbine mechanical erection, BOP mechanical and general services support contracts for the Florida Power & Light Marcus Hook project. All of
Slide 49: End Markets - Petrochemical
E THE HAKE GROUP ‘A MATRIX SERVICE COMPANY End Markets - Petroche: al Hake will benefit from several pieces of major new legislation driving significant contracting-related capital expenditures by petrochemical refiners for the next eight years. > Domestic petrochemical companies are expected to spe