Atlas Energy Solutions Inc. · NYSE:AESI
Atlas Energy Solutions — Q4 2023 Earnings Presentation
31 slides from Atlas Energy Solutions's earnings presentation, Feb 27, 2024
Slide 1: Investor Presentation February 2024
Investor Presentation February 2024 NYSE: AESI
Slide 2: Important Disclosures
Important Disclosures Forward-Looking Statements This Presentation contains “forward-looking statements” of Atlas Energy Solutions Inc. (“Atlas,” the “Company,” “AESI,” “we,” “us” or “our”) within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Sectio
Slide 3: Important Disclosures (cont'd)
Important Disclosures (cont’d) Reserves This Presentation includes frac sand reserve and resource estimates based on engineering, economic and geological data assembled and analyzed by our mining engineers, which are reviewed periodically by outside firms. However, frac sand reserve estimates are by
Slide 4: Atlas Energy Solutions (NYSE: AESI) at a Glance
Atlas Energy Solutions (NYSE: AESI) at a Glance YE 2023 Update Video Market Capitalization (1) ctrl + click to play $1.8B Enterprise Value (1) $1.7B Quarterly Dividend (2) $0.21 / share Resource Life (3) 115+ years Employees ~480 Headquarters Austin, Texas Stock Symbol NYSE: AESI (1) Source: Bloombe
Slide 5: Atlas's Acquisition of Hi-Crush Creates a Leading Proppant Logistics Provider
Atlas’s Acquisition of Hi-Crush Creates a Leading Proppant Logistics Provider and the Largest Proppant Producer in North America Acquisition includes Hi-Crush’s Permian Basin proppant production assets & Pronghorn Logistics platform (1) Please see the Acquisition Presentation posted to the Atlas Inv
Slide 6: Permian Basin Market Update
Permian Basin Market Update Completions efficiencies driving proppant demand growth; the Permian is the #1 basin in US shale Permian Basin Production & Rig Count (1,2) Permian Frac Fleets & Proppant per Fleet per year (1) 10.0 The Permian Basin is Driving U.S. Shale Production 70% Permian Frac Fleet
Slide 7: Atlas Energy Solutions FY2023 Operational & Financial Update
Atlas Energy Solutions FY2023 Operational & Financial Update Total Sales Adj. EBITDA (2) Adj. FCF (2) Net Income Cash Provided by Operating Activities $614mm $330mm $291mm $226mm $299mm (11.0mm tons) (1) (54% Margin) (47% Margin) (37% Margin) (45% growth YoY) Capital Projects Update: Dune Express, W
Slide 8: Atlas is a Leading Pure-Play Permian Proppant and Logistics Provider
Atlas is a Leading Pure-Play Permian Proppant and Logistics Provider Key Investment Highlights Pure Play Permian Asset Base (2) Compelling Valuation and Growth Profile Chaves Cochran Hockley Lubbock Crosby Dickens King Knox Trading at a discount to peer group (1) Terry Lynn Yoakum Midland Garza Kent
Slide 9: The Atlas Energy Solutions Advantage
The Atlas Energy Solutions Advantage Premium Giant Open Dune Geology 115+ years of resource life (1) at 16 mmtpy of production Lack of organics and impurities result in higher mining yields Premium quality product with high crush strength Advantaged Water Access Ample costless water provides Atlas w
Slide 10: The Permian's Giant Open Dunes are a Tier One Resource
The Permian’s Giant Open Dunes are a Tier One Resource Geology of open dunes separates AESI on scale, costs, margins & quality Premier Assets Bookending the Winkler Sand Trend Improved yields relative to off-dune deposits enhance economics Hi-Crush Kermit: • 1,226 gross acres Exceptional quality (hi
Slide 11: Atlas Plant Design & Dredge Mining Provide Operational Advantages
Atlas Plant Design & Dredge Mining Provide Operational Advantages Comparison of Electric Dredging vs. Traditional Mining Atlas has invested in automation to reduce labor costs Cost Impact Emissions Impact (1) Hours of Labor per Effective Nameplate Capacity (2) ~70% ~50% 160,000 Contract Mining Cost
Slide 12: Next Gen Dredges Expected to Drive Meaningful Cost Reductions
Next Gen Dredges Expected to Drive Meaningful Cost Reductions Operational Update – New Atlas Electric Dredges Operating Cab Falcon #1 in initial stages of commissioning Falcon #2 shipments expected to start arriving early March; Commissioning planned for early April Once Falcon dredges are commissio
Slide 13: Industry Leading Sustainability, Financial Performance & Growth
Industry Leading Sustainability, Financial Performance & Growth (1) Sales ($mm) Volume (mmtpy) 8.3 10.2 11.0 Avg. Price ($/ton) $17.21 $40.10 $42.63 Growing Sales $614 with High-Quality, $483 Diversified Customer Base $172 2021 2022 2023 Adj. EBITDA ($mm) & Adj. EBITDA Margin and Adj. EBITDA ($mm)
Slide 14: Exceptional Margins that Merit Multiple Expansion
Exceptional Margins that Merit Multiple Expansion EV / 2025E Adj. EBITDA and 2025E EBITDA Margins Atlas Trades at a Discount to Peers while Wall Street Consensus Margins Outperform Median EV / '25E Adj. EBITDA Median '25E Adj. EBITDA Margin per Wall Street Consensus 8.4x 8.3x 60.5% 6.8x 6.6x 48.1% 3
Slide 15: Consistent Long-Term Value Creation With a Well Positioned Framework for Shareholder Return of Capital
Consistent Long-Term Value Creation With a Well Positioned Framework for Shareholder Return of Capital Strong and Growing Dividend Profile ($ in millions) (Dividend Yield) Supports Atlas’s strong & growing dividend 3.3% 4.4% 4.4% +5% 4.6% $76 Atlas has paid $76 million ($0.76 / share) in +33% $55
Slide 16: Strong Balance Sheet and Liquidity Provides Financial Flexibility
Strong Balance Sheet and Liquidity Provides Financial Flexibility Financing Overview of Acquisition Pro Forma Capitalization and Liquidity Position ($ in millions) ABL Facility – Existing facility upsized to $125 million with $50 As of Pro Forma million draw planned at close of Acquisition 31-Dec-23
Slide 17: New Remote Command Center & Drop-Depot Facilities Expand Delaware Basin Footprint
New Remote Command Center & Drop-Depot Facilities Meaningfully Expands Atlas’ Delaware Basin Footprint in Advance of Dune Express Overview Expanding Operational Footprint Our remote in-field command center is Atlas will have a multi-trailer operational footprint in the Delaware Basin of presently lo
Slide 18: AESI Trucking Fleet Update: Significantly Expanding Payloads
AESI Trucking Fleet Update: Significantly Expanding Payloads Summary Update / Latest Developments AESI Payloads on Private Roads Far Exceed Industry Norm 120 5.0x ~9% of our 2023 deliveries utilized multi-trailers; seeing Atlas Record Job Average: 105 4.5x ~92 tons continued customer adoption 100 4.
Slide 19: Shortened Distances and Expanded Payloads Drive Efficiencies
Shortened Distances and Expanded Payloads Drive Efficiencies Positive disruption of the Permian trucking model reduces road traffic Conventional Trucking Atlas Drop-Depot Model Atlas / Dune Express ~23 tons ~23 tons ~70+ tons ~70+ tons 130-miles round trip 35-miles round trip 75-miles round trip 42-
Slide 20: The Dune Express: Proppant Midstream Infrastructure
The Dune Express: Proppant Midstream Infrastructure Project Overview Dune Express Update (as of February 27, 2024) The Dune Express is an overland conveyor system that will Right of Way Acquisition: Complete transport proppant to the Delaware Basin Pre-Construction Engineering: Complete — Expected c
Slide 21: AESI Logistics = Safer, More Reliable and Lower Emission Sand Delivery
AESI Logistics = Safer, More Reliable and Lower Emission Sand Delivery Daily Proppant Delivery Capacity per Truck (Current) Daily Proppant Delivery Capacity per Truck (Dune Express) (1) Today, a truck can deliver only With the Dune Express, a truck can ~125 to ~150 tons to this point deliver up to 5
Slide 22: The Dune Express and Distributed Mining Assets Drive Efficiency Gains
The Dune Express and Distributed Mining Assets Drive Efficiency Gains …is Increased by Dune Express, High-Capacity Trucking, Proppant Delivery Capacity per Truck per Day… and OnCore Mobile Mines The Dune Express is a logistical step change in the Delaware Basin Atlas Sand Mine The OnCore Mobile Mine
Slide 23: Selected Bulk Material Conveyor Systems Operating Around the World
Selected Bulk Material Conveyor Systems Operating Around the World Conveyors are commonly used to transport bulk materials globally Applying an Old Technology to a New Application: The Dune Express will be the First Long-Distance Conveyor to Transport Proppant Freeport-McMoRan Teck Resources Arch Re
Slide 24: Management's E&P Background and Track Record of Value Creation
Management’s E&P Background and Track Record of Value Creation Disruptive Oil & Gas Ventures with Track Record of Success Management’s E&P Background Drives Customer Success Pioneering Use of 3D Seismic, Disruption in Horizontal D&C What We Observed Through an E&P Operator’s Lens Techniques within t
Slide 25: Atlas Energy Solutions (NYSE: AESI) Investment Highlights
Atlas Energy Solutions (NYSE: AESI) Investment Highlights Atlas Conveyor Fed Silos at Kermit Facility Atlas Wellsite Delivery Assets Illustrative Dune Express Highway Overpass Robust Cash Flow Generation + Strong Financial Position High Quality, Differentiated Asset Base Compelling Valuation and Gro
Slide 26: Appendix
wh Atlas Appendix Energy Solutions
Slide 27: Reconciliation and Calculation of Non-GAAP Financial Measurements
Reconciliation and Calculation of Non-GAAP Financial Measurements EBITDA and Adjusted EBITDA to Net Income (in thousands) For the Year Ended December 31, 2023 2022 2021 Net income $ 226,493 $ 217,006 $ 4,258 Depreciation, depletion and accretion expense 41,634 28,617 24,604 Interest expense 17,452 1
Slide 28: Reconciliation and Calculation of Non-GAAP Financial Measurements
Reconciliation and Calculation of Non-GAAP Financial Measurements Adjusted Free Cash Flow to Net Cash Provided by Operating Activities (in thousands, except percentages) For the Year Ended December 31, 2023 2022 2021 Net cash provided by operating activities $ 299,027 $ 206,012 $ 21,356 Repayment of
Slide 29: Reconciliation and Calculation of Non-GAAP Financial Measurements
Reconciliation and Calculation of Non-GAAP Financial Measurements Net Debt Reconciliation (in thousands) For the Year Ended December 31, 2023 2022 2021 Total Debt $ 172,820 $ 147,174 $ 175,275 Discount and deferred financing costs 7,180 1,821 2,264 Finance right-of-use lease liabilities 422 20,155 —
Slide 30: Non-GAAP Financial Measure Definitions
Non-GAAP Financial Measure Definitions Non-GAAP Financial Measures Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Free Cash Flow, Adjusted Free Cash Flow Margin, Adjusted Free Cash Flow Conversion and Maintenance Capital Expenditures are non-GAAP supplemental financial measures used by our manage
Slide 31: Investor Relations Contact
Investor Relations Contact For more information, please visit our website at https://atlas.energy/ IR Contact: Kyle Turlington 5918 W Courtyard Drive, Suite #500; Austin, Texas 78730 (T) 512-220-1200 IR@atlas.energy NYSE: AESI
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