Black Diamond Group Limited · TSX:BDI
Black Diamond — Investor Presentation (August 2021)
34 slides from Black Diamond's investor presentation, August 2021
Slide 1: Investor Update
INVESTOR UPDATE INVESTOR RELATIONS August 2021 © Black Diamond Group Ltd. All Rights Reserved investor@blackdiamondgroup.com
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements. The use of the words “anticipate”, “continue”, “estimate”, “expect”, “will”, “project”, “should”, “believe”, “intend” and similar expressions identify forward-looking statements. These statements involve known and unkn
Slide 3: Introduction
Introduction Black Diamond Group rents and sells modular space and workforce accommodation solutions to customers in Canada, the United States and Australia. We serve diverse sectors including construction, education, engineering, resources, financial institutions, military, and government. Ticker T
Slide 4: Creating a Better Way
Creating a Better Way • Disruptive digital platform • Rapidly scaling LL • Unique solution focused on essential workforce travel LodgeLink • Diversified, steady, growth • Predictable, improving returns MSS • • Strong free cash flow characteristics Long-lived rental assets Modular Space Solutions • L
Slide 5: Operating Overview
Operating Overview Modular Space Solutions (MSS) Fleet 8,767 Units 1 WFS Rental Fleet 3,903 Units1 Consolidated Rentable Square Feet ~6.8 mm 160,439 TTM LodgeLink Bookings 2 $47.7 mm TTM Adjusted EBITDA 1,2,3 $399 mm PP&E Book Value 1 1. Source data: Q2 2021 Financial Statements, Management, Discuss
Slide 6: Revenue Diversity
Revenue Diversity Revenue by Industry Construction Education Government Mining Oil and Gas Other Power and Energy Infrastructure 0% 5% 10% 15% 20% 25% 30% 35% Q2-21 Q2-20 Revenue by Country Australia US Canada 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 6 Q2-21 Q2-20 © Black Diamond Group Ltd. All Rig
Slide 7: Black Diamond Group - Who We Are
Black Diamond Group - Who We Are Specialty rentals and industrial services provider organized into two business units Consolidated Rental Revenue MSS: 17.0 Modular Space Solutions 15.0 • Diversified Rental 13.0 • Custom, Major Project or Used $mm 11.0 Sales • Ancillary, Value Added Products & 9.0 Se
Slide 8: MSS Overview
MSS Overview Modular Space Solutions • 8,767 units across 19 branches in North America with attractive returns on long-lived assets • Targeting average annual net fleet growth of 10%. With added scale and additional product offering, return metrics are improving. Rental revenue growth expected to ou
Slide 9: MSS Overview – Revenue Detail
MSS Overview – Revenue Detail MSS Rental Revenue Modular Space Solutions 17.0 15.0 14.6 13.0 13.9 • Rental revenue up 60% Y/Y $mmm 11.0 11.3 • Strengthening rental revenue 9.0 9.9 8.9 9.1 driven by continued capital 7.0 8.2 8.8 8.7 investment, higher rates, 5.0 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 Q4
Slide 10: WFS Overview
WFS Overview Workforce Solutions • Includes Camps, Lodging, Energy & Industrial Services, Australia and LodgeLink • Geographic Diversification • U.S. • Eastern Canada • Continued growth in Australia • Industry Diversification • Disaster Relief • Homeless Initiatives • Mining • Green Energy • 2021 WF
Slide 11: WFS Overview – Revenue Detail
WFS Overview – Revenue Detail Workforce Solutions WFS Rental Revenue 10.0 9.0 8.0 8.6 8.9 8.6 8.2 7.0 7.7 7.5 • Added over ~$55 million of contracted 6.0 6.7 6.0 $mm revenue (rental, sales and non rental) 5.0 5.3 4.0 in 1H/2021. 3.0 2.0 1.0 • Continuing growth in eastern Canada, 0.0 Q2-19 Q3-19 Q4-1
Slide 12: Significant Asset Coverage Against Debt
Significant Asset Coverage Against Debt • Q2/2021 net debt1 of $161 mm remains well below hard asset coverage on a net book value and third-party appraisal basis • In conjunction with Vanguard deal, expanded existing credit facility to $300 million • Value of eligible rental fleet (for borrowing bas
Slide 13: Financial Flexibility
Financial Flexibility Leverage Ratio Net Debt/EBITDA (TTM as at last reported Quarter ) 5 4.5 4.5 4 4 3.5 3 3.5 2.5 2 1.5 3 1 0.5 2.5 0 Q1-20 Q2-20 Q3-20 Q4-20 Pro Q1-21 Pro Q2-21 Pro Forma Forma Forma Vanguard* Vanguard* Vanguard* 2 Debt to Adjusted EBITDA BDI Pro Forma Vanguard* MSS Comparables WF
Slide 14: Growth Through Disciplined Capex
Growth Through Disciplined Capex 2021 Capital Program • Net capex of $25 to $30 mm after used asset sales • Realizing return on assets for new capital (defined as annualized rental revenue divided into the cost of a new asset) of 18% or higher • MSS: ~$25 mm (gross) growth capital to Primary markets
Slide 15: Digital B2B Platform for Workforce Travel
LodgeLink is a multi-sided marketplace for the $320 billion of Digital B2B Platform for Workforce Travel crew travel and related goods and services consumed by crews each year.
Slide 16: LodgeLink Gaining Market Traction
LodgeLink Gaining Market Traction Total Unique Customer Accounts Multi-sided B2B Platform focused on crew travel 700 • Efficiently connect the supply/demand of room and accommodation bookings for 580 600 companies employing field crews 500 500 • Custom-built platform to remove inefficiency at every
Slide 17: LodgeLink - Room Bookings
LodgeLink - Room Bookings Gross Booking Revenue ($mm) 9 8 7 • Continued growth in unique customer accounts 6 5 4 • Growing share of travel wallet within existing 3 customer base 2 1 0 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 • Record booking volumes and gross revenue Total Gross Booking
Slide 18: Black Diamond Investment Attributes
Black Diamond Investment Attributes MSS fleet growth ahead of plan as a result of Spectrum and Vanguard acquisitions in 2020 MSS EBITDA growth to outpace fleet growth driven by Growth stronger rental revenue, economies of scale, VAPS and other service offerings LodgeLink platform is scaling qu
Slide 19: Appendix
Appendix 19 © Black Diamond Group Ltd. All Rights Reserved
Slide 20: Sources of Revenue
Sources of Revenue MSS Business Unit WFS Business Unit • Rental Revenue • Rental Revenue • Sales Revenue • Sales Revenue • Non-Rental Revenue • Non-Rental Revenue • Lodging Revenue 21 © Black Diamond Group Ltd. All Rights Reserved
Slide 21: MSS – Drivers Behind Rental Revenue Growth
MSS – Drivers Behind Rental Revenue Growth Rental Revenue 17.0 15.0 13.0 11.0 $mm 9.0 7.0 5.0 Average Rental Rate Unit Count Utilization $700 90% 10,000 85% $650 8,000 80% 6,000 $600 75% 4,000 70% $550 2,000 65% $500 - 60% 22 © Black Diamond Group Ltd. All Rights Reserved
Slide 22: MSS – VAPS Penetration
MSS – VAPS Penetration • Value Added Products & Services (VAPS) VAPS as a % of Rental Revenue 20% revenue continuing to grow 18% 16% • VAPS as a % of revenue down in Q2/21 14% due to addition of Vanguard rental 12% 10% revenue which currently has 8% 6% comparatively lower penetration 4% 2% 0% Q2-19
Slide 23: Rental Utilization
Rental Utilization MSS and WFS Rental Utilization • Utilization showing further improvement after pandemic 90% low in Q2 2020 80% 70% • MSS rental fleet maintaining 60% utilization above 70% 50% • WFS improvement in rental 40% utilization supported by 30% diversification of assets outside 20% of wes
Slide 24: MSS & WFS Fleet Overview
MSS & WFS Fleet Overview MSS Fleet Unit Count 10,000 9,000 • Continued growth in MSS rental 8,000 7,000 fleet, supported by organic investment and recent 6,000 5,000 acquisition of Vanguard 4,000 3,000 2,000 1,000 - Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 WFS Room Count 16,000 14,000 C
Slide 25: Adjusted EBITDA Detail By Quarter
Adjusted EBITDA1 Detail By Quarter Quarterly EBITDA Detail 20.0 15.0 13.3 13.5 11.1 10.5 10.6 10.0 9.9 9.9 9.8 10.0 5.0 0.0 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 (5.0) Modular Space Solutions Workforce Solutions Total Consolidated Corporate 1. See “Non-GAAP Measures” at the end of th
Slide 26: Revenue Detail by Quarter
Revenue Detail by Quarter Consolidated Revenue by Quarter 80 70 60 31.8 50 30.5 24.9 $mm 40 26.8 23.7 25.9 17.3 30 28.6 15.4 20 35.2 37.1 31.4 22.3 21.4 22.0 23.9 10 20.6 16.5 0 Q2-19 Q3-19 Q4-19 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 MSS WFS 27 © Black Diamond Group Ltd. All Rights Reserved
Slide 27: LodgeLink - The Problem
LodgeLink - The Problem Crew (workforce) travel is a complex task that adds costs to running a business • When groups or crews are required to travel for work, finding, booking and managing travel and accommodations is challenging • Solutions for consumer travel exist, however, they ignore the added
Slide 28: LodgeLink – The Problem (continued)
LodgeLink – The Problem (continued) LodgeLink addresses many of the problems faced by companies needing to book crew travel accommodations and the crew members themselves Company Perspective TRAVEL DIRECT HOTEL EMPLOYEE SELF • Booking and managing travel and accommodations LODGELINK MANAGEMENT GROUP
Slide 29: LodgeLink - Market Opportunity
LodgeLink - Market Opportunity Global Business Travel Market Annual Spend 2019 Target Market ($billions) Global Workforce Crew Travel U.S. 65 ~$1.6 Trillion Canada 6 Per Year ~$320 Australia 6 Billion Per Year South America 13 Rest of World 230 Countries listed above are areas where LL Management te
Slide 30: LodgeLink – The Solution
LodgeLink – The Solution Save time. Control costs. • A web-based solution for workforce travel management o LodgeLink is an end-to-end solution focused on the needs of crews o The platform applies web-based technology that simplifies the crew travel process • Delivering efficiency and cost control f
Slide 31: LodgeLink – Business Model
LodgeLink – Business Model Current Future Future Margin On Transactions Advertising Data & Other Services • LodgeLink profits on the spread • Advertise travel support services • SAAS Application - Potential for between buy and sell price for (dining and entertainment, remote enhanced features, data
Slide 32: LodgeLink - Value Proposition
LodgeLink - Value Proposition Example of an existing corporate customer: Room Nights: 5,000 Administrative Assumptions: Avg Number of Rooms Per Transaction: 3 Cost to issue one invoice: $15 Total Transactions: 1,667 Cost to issue one purchase order: $150 Room Rate: $100/night Traditional Use Average
Slide 33: Non-GAAP Measures
Non-GAAP Measures • Adjusted EBITDA is not a measure recognized under IFRS and does not have standardized meanings prescribed by IFRS. Adjusted EBITDA refers to consolidated earnings before finance costs, tax expense, depreciation, amortization, accretion, foreign exchange, stock-based compensation,
Slide 34: Thank You
THANK YOU INVESTOR RELATIONS © Black Diamond Group Ltd. All Rights Reserved investor@blackdiamondgroup.com
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