NRC — Q1 2019 Earnings Presentation
28 slides from NRC's earnings presentation, May 7, 2019
Slide 1: Q1 2019 Earnings Presentation
Slide 2: Important Disclaimers
Important Disclaimers Tis presentation contains ancla information and forecasts with respect to NRC Group Holdings Corp. Our auditors didnot aul, review, comple o perform any ith respect to the included herein, and ;, do not express an opinion or provide any other form of assurance with respect ther
Slide 3: Q1 2019 Financial Summary
Q1 2019 Financial Summary * Operating revenue increased 41.1% to $100.5 million compared to $71.2 million in Q1 2018 + Net loss was $8.5 million, or $(0.23) per share’, compared to net loss of $0.4 million, or $(0.02) per share + Adjusted EBITDA? was $17.2 million compared to $17.5 million + Free Ca
Slide 4: Q1 2019 Summary
Q1 2019 Summary Continue to Execute on Plan All segments drove strong organic operating revenue growth of 14% in Q1 Better than expected performance at the Karnes County waste disposal facility Continue to expand the National Emergency Response Program in the Domestic Environmental Services segment
Slide 5: Financial Review
Karnes Waste Disposal Facility nNnCG FINANCIAL REVIEW
Slide 6: NRCG - Q1 Financial Performance Summary
NRCG - Q1 Financial Performance Summary (Bin milions) Q1 Revenue Q1 Adj. EBITDA te a1 2018 at 2019 oe at 2019 at 2018 (1.6%) 2019 18 fetta poen Revenue $100.5 $71.2 AAG (Operating Expense 13) (#84) 41.3% os (16.9) (10.4) 02.5% ‘Otec (129) (©.0) 43.1% Operating Income (80.6) $3.5 116.3% Net Income ($
Slide 7: Sprint Segment — Financial Performance
Sprint Segment — Financial Performance Sprint Segment is a key driver of NRCG’s 2019 growth with attractive margin, free cash flow and return profiles (Sin milions) Q1 Revenue Performance Summary + Q1 2019 revenue increase driven by 21.0% — environmental services outperformance and contributions fro
Slide 8: Domestic ES Segment - Financial Performance
Domestic ES Segment - Financial Performance Revenues growth from SWS acquisition and continued organic demand for services (Sin milions) (a) Operating Profitby Segment defined as reported revenues less reported Cost of Good Sold (COGS) and GBA expenses Q1 Revenue Qt 2019 Q1 Operating Profit « Qt 201
Slide 9: Standby Segment - Financial Performance
Standby Segment - Financial Performance Continued execution of organic growth strategy. Mexico expansion remains on track Sinmikon) Q1 Revenue Emergency 1 Response Retainer at 2018 Qt 2019 Q1 Operating Profit (6.1%) a —=—:—lUr at 2018 at 2019 (a) Operating Profitby Segment defined as reported revenu
Slide 10: International Segment — Financial Performance
International Segment — Financial Performance Strong revenue and operating profit contributions in the quarter — * Q1 revenue increase related to full contribution of Clean Line acquisition and new remediation work won in Turkey Continued focus on land based service offerings and driving more scale
Slide 11: 2019 Outlook
2019 Outlook Reiterating 2019 previously provided guidance v Revenue expected to be between $420 million to $460 million, an increase of 8% to 18% compared to pro forma revenue of $389 million in 2018 v Adjusted EBITDA‘ is still expected to be between $105 million to $115 million, an increase of 15%
Slide 12: Recent Developments
Recent Developments Continue to Execute on Plan and Drive Shareholder Value Acquisition of OIT, Inc. * Closed on April 26, 2019 + Provider of thermal treatment of non- hazardous petroleum contaminated soils, absorbent pads and sludges, and the treatment of Per- and Polyfluoroalkyl substances (PFAS)
Slide 13: NRCG 2019 Strategic Focus - Priorities
NRCG 2019 Strategic Focus - Priorities ¥ Build new waste disposal facilities including both landfill and wastewater facilities...on track for the Reagan County and Pecos County facilities to launch in Q2 in Permian Basin v Execute Mexico growth strategy for the Standby segment... recently awarded an
Slide 14: Emergency Response - Oil Spill
Emergency Response - Oil Spill
Slide 15: NRCG Core Services
NRCG Core Services v Offering three core services across four reporting Segments ¥ Unique and diversified portfolio of assets across environmental, compliance and waste management services Standby Services Environmental Services Waste Disposal Services Services Offered = Standby International Domest
Slide 16: Summary Financial Performance — 2019 Outlook
Summary Financial Performance — 2019 Outlook Continued Execution of Growth and Profital ity Revenue by Segment (6 in mitiions) Capital Expenditures ($ in mitions) * ite secnaon POS PR206 | PF2O7 2018 «20196 PF2018. P06” PF20I7 PF 2018-20106 Laie aes U.S. Standby Domestc ES Sprint (el. QR) Intemation
Slide 17: NRCG - Free Cash Flow & Capital Expenditures
NRCG - Free Cash Flow & Capital Expenditures NRCG Capital Expenditures ¢ in mitions) (Sin mitions) 20188 ff 2019 2020 | $58 Maintenance Capex $13 $20 Growth Capex 5 5 ee Subtotal Capex $18 $25 oa Asa % of Revenue 5% 6% 5-6% ate = One-Time Waste Disposal a 33 ~12 Gndiexe): Total Capex $25 $58 Asa % o
Slide 18: Numerous Drivers of Growth
Numerous Drivers of Growth 4) Established Acquisition Platform 3) Near-Term Waste Expansion mers pulling NRC into Permian Basin to support existing activities ¥ Exceptional unit economics and rapid payback period ¥_ Significant experience designing, permitting & operating lanaffils 1) Multi-Pronged
Slide 19: Near-Term Waste Disposal Expansion
Near-Term Waste Disposal Expansion > Strategically Located Sites to Support Exi: Commentary ‘ing Customers’ Demand Permian Basin — Facility Locations + Currently in various stages of development on three waste disposal sites in the Permian Basin, providing strategic access to customers in the Delawa
Slide 20: Competitive Advantages
Competitive Advantages Comprehensive Suite of Specialized Services National Scale with Global Service Capabilities Significant Barriers to Entry Highly Recurring, Non-Discretionary Demand Attractive Market Opportunity Exceptional Cash Flow Generation Multi-Pronged Growth Strategy Established Acquisi
Slide 21: Benchmarking to Peers — Valuation
Benchmarking to Peers — Valuation NRCG at a Discount to Peers Des; Premium Business 2017 - 2019E Revenue CAGR 2017 - 2019E Adjusted EBITDA CAGR 268% 7 2% # ole *” vsae re EV /2019E Adjusted EBITDA
Slide 22: NRCG Capital Structure
NRCG Capital Structure a Cash $179 Revolving Credit Facility $20.0 $60M Commitment as of May 1, 2019 ($40M Undrawn) Senior Term Loan“ $3405 Equipment Loan $05 Total Debt $361.0 Total Net Debt $343.1 Convertible Preferred $103.0 Convertible at $12.50 per share; quarterly dividend at 7% annualized rat
Slide 23: Statement of Operations
(S ousends) ‘operating revenue costs and expenses ‘Operating expenses, including cost ofrevenue (ecusive of ‘depreciation and amrtztion) ‘Genemland adninistative expenses Depreciation and anwtization Management fees ‘Acquisition expenses ‘Ghangen fir valne of contingent consideration ‘ther expense,
Slide 24: NRCG — 2019 Q1 Balance Sheet (Unaudited)
NRCG — 2019 Q1 Balance Sheet (Unaudited) 6
Slide 25: NRCG — 2019 Q1 Statement of Cash Flows (Unaudited)
NRCG — 2019 Q1 Statement of 6 Cash Flows (Unaudited)
Slide 26: NRCG — 2019 Q1 Segment Results (Unaudited)
NRCG — 2019 Q1 Segment Results (Unaudited) Domestic Domestic (tous) Standby Eawvionnentat Corporate Senioes Seve Intemational spi ee Tota ‘Thave Months Ended March 3), 2a Operating rvenne Cn = 8154 Operating expenses, inching oot of revenue (eluding depreciation, station and certain sa 31289 sais se
Slide 27: 2019 Q1 Adjusted EBITDA & Free Cash Flow Reconciliation
2019 Q1 Adjusted EBITDA & Free Cash Flow Reconciliation Ganib ests uenratnahencertc as 2 cic og" am ra Mogantee 2 ‘ene tematic Te one Bas Dir en aes He so va zr A Emo Aten ht Oe ee ase EGAAP nt income 2 Comte st. ofr roth ppt ia Mei senior management es, a wells epee an aq ssa, ceil em, cone Sh pol
Slide 28: Contact
CONTACT: Gateway Investor Relations Cody Slach or Jared Filippone, CFA 949.574.3860