Pulse Seismic Inc. · TSX:PSD
Pulse Seismic — Investor Presentation (May 2024)
37 slides from Pulse Seismic's investor presentation, May 1, 2024
Slide 1: Corporate Presentation Q1 2024
Corporate Presentation Q1 2024
Slide 2: Advisories
ADVISORIES FORWARD-LOOKING NON-GAAP MEASURES INFORMATION This presentation contains non-GAAP measures. The Company’s continuous disclosure documents provide This presentation contains information that constitutes discussion and analysis of “EBITDA”, “EBITDA per share”, “forward-looking information”
Slide 3: We Are Canada's Largest Seismic Data Library Provider
WE ARE CANADA’S LARGEST SEISMIC DATA LIBRARY PROVIDER
Slide 4: Licensed Multiple Times
65,310 Sq. km of 3D seismic LICENSED MULTIPLE 829,207 Lin. km of 2D seismic TIMES DATA LIBRARY SALES • Oil and gas producers of all sizes and new energy companies license our digitally stored 2D and 3D data. • We are a pure-play seismic data library company. The library is our main asset. • Pulse op
Slide 5: Metrics That Matter
METRICS THAT MATTER EBITDA EBITDA SHAREHOLDER MARGIN FREE CASH FLOW We are a data-driven, cash- EBITDA is calculated as EBITDA plus non-cash and based business. Pulse’s earnings or loss from non-recurring expenses, less EBITDA margin, on data operations before interest, interest on long-term debt li
Slide 6: Key Trading Facts
KEY TRADING FACTS Information as at March 31, 2024, unless otherwise specified PULSE SEISMIC INC. Trading Symbols TSX: PSD OTCQX: PLSDF TSX: PSD Corporate Headquarters Calgary, Alberta, Canada OTCQX: PLSDF Stock Price $2.24 Shares Outstanding 51,994,563 Avg. Daily Trading Volume (Q1 2024) 24,507 Ins
Slide 7: Q1 2024 YTD Financial Results
Q1 2024 YTD FINANCIAL RESULTS $8.8MM TOTAL REVENUE • NCIB Shares Purchased - $1.2MM (627,300 shares at $2.5MM average price of $1.89 per share) SCB and SG&A EXPENSES • Special dividend of $0.20 per share paid on January 8, 2024 $6.2MM (71% of revenue) • Regular quarterly dividend of $0.01375 per sha
Slide 8: The Company We Have Built
THE COMPANY WE HAVE BUILT Positioned for volatile commodity-price environment COSTS AND SPENDING CREDIT FACILITIES Pulse’s operating costs were $8.7M in 2023, generating The Company amended its credit facility positive EBITDA (78% of revenue) in February 2024 to save costs on and shareholder free ca
Slide 9: Value in Our Business
VALUE IN OUR BUSINESS
Slide 10: Understanding Our Business
UNDERSTANDING OUR BUSINESS Simplified geological column, greater Alberta What We Do: Deep Basin Pulse’s business model: To repeatedly relicense high-quality 2D and 3D data to traditional and new energy companies. Why 2D: 2D seismic allows exploration companies to plan broad land acquisition programs
Slide 11: 3D Seismic Enables Detailed Modelling of Geologically Complex Targets
3D SEISMIC ENABLES DETAILED MODELLING OF GEOLOGICALLY COMPLEX TARGETS › 3D seismic is more detailed and more expensive to shoot. › Critical for most horizontal drilling, unconventional plays like shale gas and tight light oil formations, as well as complex conventional drilling. › Pulse owns 65,310
Slide 12: Pulse: A Western Canada Market Leader
PULSE: A WESTERN CANADA MARKET LEADER ESTIMATED CANADIAN 2D MARKET ESTIMATED CANADIAN 3D MARKET SEI Seismic Sigma Exchange Sigma 68,000 Schlumberger 4,554 85,299 Others 10,827 829,207 PULSE 16,678 65,310 TGS Arcis 18,639 2D 3D (km2) PULSE (km) 39,552 SEI Seismic Exchange 2,767 Divestco (Charts exclu
Slide 13: Western Canada Data Library Play Coverage
WESTERN CANADA Data Library KEY PULSE DATA LIBRARY AREAS Play Coverage Montney 2D Coverage 191,726 km 3D Coverage 40,274 km2 Deep Basin 2D Coverage 127,505 km 3D Coverage 24,109 km2 Duvernay 2D Coverage 265,008 km 3D Coverage 24,313 km2 Cardium 2D Coverage 102,901 km 3D Coverage 9,642 km2
Slide 14: Our Customers: Diverse and Long-Term
OUR CUSTOMERS: DIVERSE AND LONG-TERM PULSE’S CUSTOMERS: › New energy customers include those › Concentrated in Alberta’s oil and exploring for hydrogen, lithium and natural gas and new energy geothermal, as well as related industries. resources such as helium, and those › 58% of purchases during the
Slide 15: Generating Revenue: Two Types of Library Data Sales
GENERATING REVENUE: TWO TYPES OF LIBRARY DATA SALES TRADITIONAL SALE TRANSACTION-BASED SALE A straightforward license New licensing fees on already- of 2D or 3D data from licensed library data triggered Pulse’s library related to by a change in control over the drilling in new areas or licensee or t
Slide 16: Drivers of Traditional Data Library Sales
DRIVERS OF TRADITIONAL DATA LIBRARY SALES
Slide 17: Types of Transaction-Based Sales
TYPES OF TRANSACTION-BASED SALES PARTNERSHIPS & CORPORATE JOINT VENTURES MERGER/ACQUISITION ASSET SALE New technical or Buyer has 30 days to Seismic licence does not operational participants decide to pay a transfer with the asset. must purchase a data discounted relicensing fee Pulse gains a potent
Slide 18: Seismic Data for Subsurface Exploration
SEISMIC DATA for SUBSURFACE EXPLORATION Existing and technology enhanced seismic data improves subsurface characterization for oil and gas and energy transition exploration. Pulse’s existing and technology optimized data improve subsurface characterization for structural mapping and validating and u
Slide 19: Data Sales Profiles
DATA SALES PROFILES Traditional Sales Transaction-Based Sales 35,775 ANNUAL BREAKDOWN BETWEEN 31,762 TRADITIONAL & TRANSACTION-BASED SALES (THOUSANDS OF DOLLARS) 24,051 19,607 19,114 16,629 14,985 12,923 11,763 11,095 10,119 9,970 19,606 9,112 6,740 12,942 4,369 4,028 949 233 2014 2015 2016 2017 201
Slide 20: Growing the Size of the Seismic Data Library
GROWING THE SIZE OF THE SEISMIC DATA LIBRARY SEISMIC 900,000 70,000 800,000 LIBRARY 60,000 700,000 50,000 600,000 3D (sq. km) 500,000 40,000 › January 15, 2019, Pulse acquired 100 percent of 2D (km) the shares of Seitel Canada Ltd. for $61.8MM. Includes approximately 36,354 net square 400,000 30,000
Slide 21: Strategic Investments at Opportune Moments
STRATEGIC INVESTMENTS AT OPPORTUNE MOMENTS › Acquired seismic assets from Divestco in 2010. › Acquired 100% of shares of Seitel Canada Ltd. › Purchase price of $75.5MM included $55.5MM in cash plus 14.3MM Pulse › Purchase price of $61.8MM . common shares. › 126% increase in Pulse’s 3D data library,
Slide 22: Current Seismic Coverage
CURRENT SEISMIC COVERAGE Western Canada’s Premium Licensable Seismic Dataset 65,310 Sq. km of 3D seismic 829,207 Lin. km of 2D seismic
Slide 23: Value in Our Results
VALUE IN OUR RESULTS
Slide 24: Seismic Data Library Sales Strongly Correlate to Shareholder Free Cash Flow
SEISMIC DATA LIBRARY SEISMIC DATA LIBRARY SALES VS. SFCF PER SHARE SALES STRONGLY 70.0 0.90 CORRELATE TO 60.0 0.80 SHAREHOLDER FREE 0.70 ($/Diluted Weighted Share Outstanding) 50.0 CASH FLOW 40.0 0.60 0.50 ($MM) 30.0 0.40 0.30 20.0 0.20 10.0 0.10 0.0 0.00 2007 2008 2009 2010 2011 2012 2013 2014 2015
Slide 25: How We Calculate Shareholder Free Cash Flow
Three months ended March 31, ($MM except per share) 2024 2023 2023 Full Year HOW WE Data library sales Less: 8,777 8,407 39,127 CALCULATE Salaries, internal commissions and benefits Other SG&A 1,928 620 1,281 511 6,500 2,196 SHAREHOLDER EBITDA 6,229 6,615 30,431 FREE CASH Add: Non-cash expenses 311
Slide 26: First Quarter Highlights
Year ended Three months ended March 31, (thousands of Canadian dollars except December 31, 2024 per share data and numbers of share) 2024 2023 2023 Revenue FIRST Data library sales 8,777 8,407 39,127 QUARTER Amortization of seismic data library 2,270 2,286 9,103 HIGHLIGHTS Net earnings Per share bas
Slide 27: Value for Shareholders
VALUE FOR SHAREHOLDERS
Slide 28: Shareholder Value Through Dividends and Share Purchases
SHAREHOLDER VALUE THROUGH DIVIDENDS DIVIDENDS AND SHARE PURCHASES ($MM) AND SHARE PURCHASES Dividends ($MM) Share Purchases ($MM) 21.4 TOTAL SPENDING ON DIVIDENDS AND SHARE PURCHASES ($MM) 10.9 10.8 10.5 $48.5 8.4 8.4 7.1 $138.3MM 6.3 5.3 4.8 4.5 4.7 5 4.1 3.5 3.4 2003-2023 0.02 2.8 0.31 2.7 2.3 2.2
Slide 29: Ten-Year Allocation of Funds
TEN-YEAR ALLOCATION OF FUNDS 2014-2023 FUNDS AVAILABLE ($MM) FUNDS ALLOCATED ($MM) Long Term Debt Unallocated $33 working $27 capital Common Share Cash and $19 Purchases Working Capital Debt $7 $55 Repayments $1 Equity Financing Dividend Net Capital Payments $70 $35 Expenditures $165 Shareholder Fre
Slide 30: Our People
OUR PEOPLE EXECUTIVE MANAGEMENT TEAM Neal Coleman Pamela Wicks Trevor Meier President & CEO Vice President Finance Vice President & Chief Financial Sales and Marketing Officer DIRECTORS Robert Robotti, Chair of Pulse Seismic Melanie Westergaard Dallas Droppo President and CIO, Robotti & Company Advi
Slide 31: Financial Appendix
FINANCIAL APPENDIX
Slide 32: Consolidated Statements of Financial Position
(thousands of Canadian dollars) (unaudited) M arch 3 1 , 2 0 2 4 December 31, 2023 Assets Cash and cash equivalents 1 3 ,7 6 5 15,948 CONSOLIDATED Trade and other receivables 294 6,281 Prepaid expenses 360 292 Total current assets 1 4 ,4 1 9 22,521 STATEMENTS Seismic data library 1 6 ,2 6 2 18,307 O
Slide 33: Consolidated Statements of Comprehensive Earnings
Three months ended March 31, (thousands of Canadian dollars) (unaudited) 2024 2023 Revenue 8,777 8,407 CONSOLIDATED Operating expenses STATEMENTS OF Amortization of seismic data library 2,270 2,286 COMPREHENSIVE Salaries, internal commissions and benefits Other selling, general and administrative co
Slide 34: Consolidated Statement of Cash Flows
Three months ended March 31, (thousands of Canadian dollars) (unaudited) 2024 2023 Cash flows provided by (used in): Operating: Net earnings and comprehensive income 2,681 2,908 CONSOLIDATED Adjustment for: Amortization of seismic data library Depreciation 2,270 20 2,286 21 STATEMENT OF Income tax e
Slide 35: Capital Structure: Shares Outstanding at Year-End
CAPITAL STRUCTURE SHARES OUTSTANDING AT YEAR-END 67.2 66.0 › Authorized unlimited number of 61.1 59.3 common and preferred shares (MILLIONS OF SHARES OUTSTANDING) 57.2 55.9 55.6 54.0 53.8 53.8 53.8 53.8 53.6 52.6 › 52,621,863 common shares outstanding (December 31, 2023) 2010 2011 2012 2013 2014 201
Slide 36: Reasons to Invest in Pulse
REASONS TO INVEST IN PULSE COMPETITIVE STRENGTHS OPPORTUNITIES TIME-TESTED BUSINESS MODEL › High barriers to entry both for E&P › Industry M&A activity creates › Strong balance sheet. companies shooting own data and potential for transaction-based data › Debt Free for competing data providers. sales
Slide 37: Pulse Seismic Inc.
Pulse Seismic Inc. 2700, 421 7th Avenue SW. Calgary, Alberta T2P 4K9 Toll-free: 1.877.460.5559 Telephone: 1.403.237.5559 Email: info@pulseseismic.com