Energy Recovery, Inc. · NASDAQ:ERII
Energy Recovery — Sidoti Spring Small Cap Virtual Conference 2022
24 slides from Energy Recovery's conference presentation, Mar 23, 2022
Slide 1: Driving Industrial Sustainability
NASDAQ: ERII Driving Industrial Sustainability Sidoti Spring Small Cap Virtual Conference March 23-24, 2022
Slide 2: Forward looking statement
Forward looking statement This presentation contains forward-looking statements within the “Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this report include, but are not limited to, statements about our expectations, objectives, antic
Slide 3: Ongoing Strong Fundamentals
Ongoing Strong Fundamentals Avg. Product Revenue Rapid Growth 20% Growth, 2015-2021 High Margin >68% 2021 Gross Margin Strong Balance Sheet $108M Cash & Securities and No Debt 3
Slide 4: Share Price Growth of 3.5X Since 2018 – Outpacing U.S. Indices
Share Price Growth of 3.5X Since 2018 – Outpacing U.S. Indices 70% 60% +58% $22.632 50% +45% $6.531 40% 30% +39% 20% 10% 0% 2019 2019 2020 2020 2021 2021 ERII S&P 500 Dow Jones NASDAQ Russell 1 As of December 28, 2018; 2 As of November 12, 2021 4
Slide 5: We Have a Strong and Growing ESG Story
We Have a Strong and Growing ESG Story metric tons emissions avoided saved for customers on $2.6B energy expenses annually1 12.5M due to PXs – nearly 3M vehicles removed from the road annually1 product revenue from IR Magazine Nominee for “Best 90%+ energy-efficiency related products 2022 ESG Report
Slide 6: What Is Energy Recovery Trying to Achieve?
What Is Energy Recovery Trying to Achieve? We seek to achieve long-term sustainable growth by accelerating the environmental sustainability of our customers operations Our solutions reduce waste and energy consumption in industrial fluid-flow systems We revolutionized seawater reverse osmosis desali
Slide 7: Three Strategic Pillars for Long-Term Sustainable Growth
Three Strategic Pillars for Long-Term Sustainable Growth PILLAR 1 PILLAR 2 PILLAR 3 DIVERSIFIED REVENUE GROWTH INCREASE BOTTOM LINE ESG Protect position in SWRO by Maintain high margin story Accelerate environmental improving products and By creating customer value via PX sustainability for customer
Slide 8: The PX is Energy Recovery's Core Technology
The PX is Energy Recovery’s Core Technology • Best-in-class energy recovery • The PX = unbeatably low life-cycle costs • Our pressure exchanger technology works as a platform to build product applications • The technology is versatile – can handle liquid, gas, and a range of pressures • Benefits inc
Slide 9: PX Technology Platform – Excelling in a Wide-Range of Pressure Applications
PX Technology Platform – Excelling in a Wide-Range of Pressure Applications • The Pressure exchanger is Energy Recovery’s core technology. This versatile technology acts as a fluid piston, efficiently transferring energy between high- and low-pressure fluids and gases through continuously rotating d
Slide 10: Industries Benefiting from PX Technology
Industries Benefiting from PX Technology Reverse Osmosis Desalination Industrial Wastewater Treatment CO2 Refrigeration 10
Slide 11: Pressure Exchanger Technology in SWRO
Pressure Exchanger Technology in SWRO Incoming seawater routed to pump and PX Low pressure potable water Main pump size PX transfers energy reduced by up to from high pressure 60% brine to seawater 1Ocean or other geological mass The Ocean1 PX lowers energy consumption by up to 60% 11
Slide 12: World-Wide Demand for Fresh Water Continues to Outstrip Supply
World-Wide Demand for Fresh Water Continues to Outstrip Supply The United Nations estimates a 40% gap in freshwater supplies by 2030 – equivalent to 75% of the Mediterranean Sea 12
Slide 13: Global Water Stress Continues to Rise
Global Water Stress Continues to Rise World Economic Forum 13
Slide 14: The World Needs More Water
The World Needs More Water Saudi Water Partnership Company has released its Seven-Year Statement for 2020-26 Africa’s largest dam powers dreams of prosperity in Ethiopia – and fears of hunger in Egypt Alaska Villages Run Dry and Residents Worry About a ‘Future of No Water’ 14
Slide 15: We Help Address The Growing Water Gap In Two Fast Growing Industries
We Help Address The Growing Water Gap In Two Fast Growing Industries REVERSE OSMOSIS INDUSTRIAL DESALINATION WASTEWATER Addressable Market Addressable Market • Expect to double sales to ~$200M by 20261 • ~$1B with potential to triple by 20301 • 10-20% projected avg. annual market growth • Dependent
Slide 16: Our PX Platform Has Come To Dominate Large Scale SWRO Desalination
Our PX Platform Has Come To Dominate Large Scale SWRO Desalination CUMULATIVE WON MEGA PROJECT1 Desal Capacity (m3/day) 20M Millions 18M ERII Competitors 16M 14M 12M 10M 8M 6M 4M 2M 0M '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 TECHNOLOGY STRENGTH = HIGH MARGIN Our ceramics PX P
Slide 17: CO2 Refrigeration
NASDAQ: ERII CO2 Refrigeration PX Technology in Gas and Supercritical Liquid Applications
Slide 18: Transitioning from Harmful HFCs to Natural CO2 Refrigerants
Transitioning from Harmful HFCs to Natural CO2 Refrigerants Regulation is forcing a global transition to natural refrigerants such as CO2 due to global warming potential (GWP1) of existing HFC refrigerants Hydrofluorocarbons (HFCs) 1,000 - 13,000 GWP CO2 1 GWP (GWP) Global Warming Potential describe
Slide 19: ERII's PX Technology is a Game Changer for the Refrigeration Industry
ERII’s PX Technology is a Game Changer for the Refrigeration Industry ~$1B annual TAM for ERI by 20301 1Energy Recovery projections and estimates based on currently available information. Actual results and figures may differ. 19
Slide 20: Disrupting a Large Market with the PX G
Disrupting a Large Market with the PX G CO2 systems drive up operating costs to owners via higher energy consumption Our PX G1300 reduces energy consumption in CO2 systems by recycling pressure energy during operations, much as in desalination Signed first contract in November 2021 for delivery in 2
Slide 21: PX Technology in CO2 Refrigeration
PX Technology in CO2 Refrigeration PX G13001 Gas pressurized in PX bypasses the compressor Compressor PX converts low pressure pressurizes CO2 up to gas from evaporator to 1,300 PSI. High pressure gas from ~1300 PSI, saving energy gas cooler is converted in PX to low pressure to create cold We have
Slide 22: Targeting 25% - 40% avg. Revenue Growth Through 2026
Targeting 25% - 40% avg. Revenue Growth Through 2026 $570M Refrigeration Industrial Wastewater Desalination $300 $330M $100 $150M+ $70 $130M $30 $102M $200 $200 $127 $146 $102 2021 2022 2023 Low High 2026 Note: These revenue growth range goals, long-term vision and similar statements illustrate poss
Slide 23: Thank You
zo) energy recovery’ Thank You
Slide 24: Contact Us
Contact Us James Siccardi, VP, Investor Relations Energy Recovery, Inc. +1.832.474.7628 | Mobile 1717 Doolittle Drive jsiccardi@energyrecovery.com San Leandro, CA 94577, USA Lionel McBee, Sr. Mgr., Investor Relations energyrecovery.com +1.832.334.3685 | Mobile limcbee@energyrecovery.com ESG@energyre
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