Divestco — Investor Presentation (September 2005)
37 slides from Divestco's investor presentation, September 2005
Slide 1: Divestco Inc. Investor Relations Presentation
Divestco Inc. Investor Relations Presentation September 2005 www.divestco.com TSX-V:DVT
Slide 2: Disclaimer
Disclaimer This presentation may contain forward-looking statements, including statements regarding the business and anticipated financial performance of Divestco Inc. “(the Company”). These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause t
Slide 3: Investment Highlights
Investment Highlights •Attractive valuation compared to peers •Demonstrated growth profile •Numerous growth initiatives •Strong customer base •Solid recurring revenue base •Significant insider ownership www.divestco.com TSX-V:DVT
Slide 4: Company Snapshot
Company Snapshot •Stock Symbol : DVT (TSX-V) •Shares Outstanding: 29,611,663 •Insider Ownership: 35% •Employees: 245 •52 Week High/Low: $2.80/$0.76 •Current Share Price: $2.65 •Current Market Cap: $79,000,000 •Enterprise Value1: $83,000,000 www.divestco.com TSX-V:DVT 1) Market Capitalization + Prefe
Slide 5: Corporate Profile
Corporate Profile Divestco is an oil and gas software, data, technical services, and seismic brokerage company committed to offering superior products and services to the oil and gas industry. By implementing a strategy of integration between our software offerings, our services and datasets, we are
Slide 6: Officers & Directors
OFFICERS & DIRECTORS Stephen Popadynetz – CEO & Director Terry Barnhart – President Roderick Chisholm – Chief Financial Officer John Brussa – Chairman (1)(2) Wade Brillon - Director M. Scott Ratushny - Director(1)(3) Edward L. Molnar - Director(2) Brent Gough - Director(1)(2)(3) 1) Member of Audit C
Slide 7: Revenue Profile
Revenue Profile Divestco is comprised of 4 verticals or revenue pillars. •Services •Data •Software •Brokerage www.divestco.com TSX-V:DVT
Slide 8: Sources of Revenue
SOURCES OF REVENUE 2003 2004 $15MM $26MM 14% 22% 31% 28% 19% 34% 13% 39% Services Data Software Brokerage www.divestco.com TSX-V:DVT
Slide 9: Sample Customer Profile
Sample Customer Profile www.divestco.com TSX-V:DVT
Slide 10: Financial Highlights - 2004
FINANCIAL HIGHLIGHTS - 2004 For the year ended Dec 31 % ($000’s, except per share) 2004 2003 Change Revenue $25,912 $15,043 72% EBITDA 6,745 1,697 297% Operating Income 3,520 153 2201% Net Income 3,948 719 449% Per share (basic) 0.156 0.042 271% Per share (diluted) 0.155 0.041 278% Funds from operat
Slide 11: Financial Highlights - 2004
FINANCIAL HIGHLIGHTS - 2004 • Revenues grew to a record $26 million in 2004 from $15 million in 2003 and $5 million in 2002 • EBITDA grew by more than $5 million from 2003 and over $6 million from 2002 • Net income increased by more than 400% and 1400% from 2003 and 2002, respectively www.divestco.c
Slide 12: Financial Highlights by Year
FINANCIAL HIGHLIGHTS BY YEAR 30 Revenue 25 EBITDA 20 Net Income $ Millions 15 Funds from 10 Operations Working 5 Captial 0 (5) 2002 2003 2004 www.divestco.com TSX-V:DVT
Slide 13: Financial Highlights - Q2 2005
Financial Highlights – Q2 2005 10.0 Revenue 8.0 EBITDA 6.0 Net Income $ Millions 4.0 Funds from 2.0 Operations Working 0.0 Captial (2.0) (4.0) Q2 2004 Q2 2005 www.divestco.com TSX-V:DVT
Slide 14: Financial Highlights - Q2 2005
Financial Highlights – Q2 2005 For the Quarter ended % June 30 ($000’s) 2005 2004 Change Revenue $9,221 $6,073 52% EBITDA 3,814 891 328% Operating Income 1,019 151 576% Funds from Operations 3,584 831 331% Net Income 599 388 55% Per share (basic) 0.024 0.015 60% Per share (diluted) 0.024 0.015 60% w
Slide 15: Financial Highlights - YTD June 2005
Financial Highlights – YTD June 2005 20.0 Revenue 15.0 EBITDA Net Income $ Millions 10.0 Funds from Operations 5.0 Working Captial 0.0 (5.0) YTD June 04 YTD June 05 www.divestco.com TSX-V:DVT
Slide 16: Financial Highlights - YTD June 2005
Financial Highlights – YTD June 2005 For the Six Months % ended June 30 ($000’s) 2005 2004 Change Revenue $17,936 $12,270 46% EBITDA 7,928 2,366 235% Operating Income 3,472 930 273% Funds from Operations 7,543 2,294 229% Net Income 2,200 1,190 85% Per share (basic) 0.089 0.047 89% Per share (diluted
Slide 17: Financial Highlights - YTD June 2005
Financial Highlights– YTD June 2005 • Revenue Increased by 46% however expenses increase by only 1% which included a 16% decrease in G&A expenses • Record Revenue, EBITDA, and Funds From Operations • 8.8 cents per share in earnings (diluted) vs. 4.6 cent per share (diluted) in 2004 - 91% increase •
Slide 18: Financial Highlights by Quarter
Financial Highlights by Quarter 10.0 9.0 Revenue 8.0 7.0 EBITDA 6.0 $ Millions 5.0 Net Income 4.0 3.0 Funds from Operations 2.0 1.0 0.0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2003 2004 2005 www.divestco.com TSX-V:DVT
Slide 19: Results of Operations - YTD 2005
RESULTS OF OPERATIONS – YTD 2005 Key factors: • Completion of Graham Creek, Red Willow, and Windsor Creek 3D seismic surveys resulting in $2.6 million in revenue • Closing of two acquisitions – PDS and Drilling Records • Closing of a $10MM brokered private placement • Record YTD and Quarterly Revenu
Slide 20: Results of Operations - 2004
RESULTS OF OPERATIONS - 2004 Key factors: • Purchase of Petro Canada’s Seismic Database and a successful bundling of seismic, software, and archiving with sales exceeding $3 million • Completion of the Kelly Lakes and Gunnell seismic survey • Record year in Services, Data and Software • Integration
Slide 21: Divestco Seismic Database
DIVESTCO SEISMIC DATABASE www.divestco.com TSX-V:DVT
Slide 22: Integrated Software
INTEGRATED SOFTWARE www.divestco.com TSX-V:DVT
Slide 23: 2005 Growth Initiatives and Outlook
2005 Growth Initiatives and Outlook www.divestco.com TSX-V:DVT
Slide 24: Strategic Objectives
Strategic Objectives Grow th Through Inte gration Acquis itions Organic Grow th Es tablis h Critical & Ope rational Proce s s e s Efficie ncie s Accountability & M ark e t Focus e d Re s pons ibility www.divestco.com TSX-V:DVT
Slide 25: Growth Through Acquisitions
Growth Through Acquisitions Announced acquisition of Petro Data Source, Inc. (PDS) on April 27, 2005 • Adds well header and production data for more than 4.3 million wells located in most of the producing states in the U.S., including federal waters of the Gulf of Mexico and offshore California and
Slide 26: Growth Through Acquisitions
Growth Through Acquisitions Announced acquisition of Drilling Records on September 2, 2005 • Adds libraries of drilling data throughout Canada and the United States containing thousands of wells that are added to daily • Adds Rig location data in regional report form with the data sorted by operator
Slide 27: Growth Through Acquisition
Growth Through Acquisition •Plan is to complete an additional share/asset acquisition during the remainder of 2005 in Canada www.divestco.com TSX-V:DVT
Slide 28: Service Objectives for 2005
Service Objectives for 2005 • Continue bundling of services with software/data sales • Potential exists for the creation of a consulting division • Move low margin/loss leader digitizing services offshore (India) • Cross train staff in archiving and digitizing departments • New Archive System Develo
Slide 29: Data Objectives for 2005
Data Objectives for 2005 • Expand on seismic database through acquisition of additional multi-client seismic data • Acquire one seismic asset in Western Canada of similar size to the Petro Can dataset • Leverage the Seismic Asset for additional acquisition capital www.divestco.com TSX-V:DVT
Slide 30: Software Objectives for 2005
Software Objectives for 2005 • Roll out of new and enhanced products for: - DataStore V.1.0 - WinPICS V5.2 - EnvisionVSX V1.1 - SeisScapeVSX V1.0 - GeoVista 4.2.5 - GeoCarta Tools 1.8 - Synthetic 1D • Convert Software to NAD83 Compliance www.divestco.com TSX-V:DVT
Slide 31: Brokerage Objectives for 2005
Brokerage Objectives for 2005 •Create Data Management subdivision using Divestco’s leading management software •Recruit Additional Brokers •Investigate opportunities to acquire additional brokerage assets/companies for possible expansion of division www.divestco.com TSX-V:DVT
Slide 32: Share Price
Share Price •Continue to produce positive operating results •Conduct investor relation presentations for potential institutional and retail investors and continue with significant road shows in Q3 and Q4 •Continue with strict austerity measures and focus on internal efficiencies •Look for accretive
Slide 33: Guidance for 2005
Guidance for 2005 35 30 Revenue 25 EBITDA $ Millions 20 Funds from Operations 15 Net Income 10 5 0 2002 2003 2004 2005 www.divestco.com TSX-V:DVT
Slide 34: Share Price Performance (1 year) Trading Volume
Share Price Performance (1 year) $2.75 500,000 $2.50 400,000 $2.25 $2.00 Trading Volume 300,000 Share Price $1.75 $1.50 200,000 $1.25 $1.00 100,000 $0.75 $0.50 0 8-Sep-04 8-Dec-04 9-Mar-05 8-Jun-05 7-Sep-05 www.divestco.com TSX-V:DVT Provided by First Associates Investments Inc.
Slide 35: Peer Comparison
Peer Comparison1 P/E P/CF EV / EBITDA EV / Sales 2 3 Company Ticker EV LTM 2005F LTM 2005F 3 LTM 2005F 3 LTM 2005F 3 Computer Modelling Group Ltd. CMG.TE $ 45.1 17.9x N/A 15.3x N/A 8.6x N/A 3.0x N/A Kelman Technologies Inc. KTI.TE $ 16.8 NMF N/A 18.0x N/A 11.7x N/A 0.8x N/A Pason Systems Inc. PSI.TE
Slide 36: Investment Highlights
Investment Highlights •Attractive valuation compared to peers •Demonstrated growth profile •Numerous growth initiatives •Strong customer base •Solid recurring revenue base •Significant insider ownership www.divestco.com TSX-V:DVT
Slide 37: Thank you for your interest
Thank you for your interest For further information, please contact: Stephen Popadynetz, CEO (403) 218-6466 or stephen@divestco.com or Roderick Chisholm, CFO (403) 218-6450 or rod.chisholm@divestco.com or investor.relations@divestco.com www.divestco.com TSX-V:DVT