Patterson-uti Energy, Inc. · NASDAQ:PTEN
Patterson-uti Energy — Investor Presentation (September 2024)
29 slides from Patterson-uti Energy's investor presentation, Sep 3, 2024
Slide 1: Investor Presentation September 2024
Investor Presentation September 2024
Slide 2: Forward Looking Statements & Disclosures
2 This material and any oral statements made in connection with this material include "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Statements made which provide the Company’s or management’s intentions, beliefs, expectations o
Slide 3: Who We Are
Who We Are
Slide 4: Building a Diversified Oilfield Services Leader
4 Total Company Revenue ($) 1978 1980 2001 2010 2017 2021 LTM 6/30/2024 Pro Forma Patterson Drilling formed First frac job for Universal Pressure Pumping Patterson Energy and UTI Energy merge PTEN acquires Key Energy Services’ pressure pumping assets PTEN acquires Seventy Seven Energy PTEN acquires
Slide 5: Patterson-UTI at a Glance
5 Active Markets International markets primarily represented by drilling product sales over 30 countries With a diverse global footprint… 1Peer Group includes ACDC, BKR, HAL, HP, LBRT, NOV, Pro Forma SLB + CHX, as reported in SEC filings 2Bloomberg as of August 30, 2024 LTM 6/30/24 North America Rev
Slide 6: Integrated to Build a Sustained Operating Advantage
6 Hydraulic Fracturing Wireline Operations Natural Gas Fueling Oilfield Logistics Cementing 3.2 Million Hydraulic Horsepower1 Completion Services Other business includes Patterson Petroleum and Great Plains Oilfield Rental. 1Reflects deployed and idle equipment capacity as of June 30, 2024. 2Drillin
Slide 7: Peer Leading Combination of Shareholder Returns with De-Leveraging
7 Shareholder Returns as a % of Current Market Cap Includes Dividends and Share Repurchases Shareholder Returns as a % of Current Market Cap Includes Dividends and Share Repurchases 1Peer group includes OFS comps ACDC, BKR, HAL, HP, LBRT, NBR, PDS, PUMP, and SLB. Peer data sourced from company SEC f
Slide 8: Business Activity Update
8 Business Activity Update Drilling Services Segment ▪ Currently operating 106 rigs and now expect to operate 107 rigs on average for the third quarter ▪ Expect a modest net increase in active rigs from current levels early in the fourth quarter; drilling recovery expected in 2025 in natural gas bas
Slide 9: 2024E Depreciation, Depletion, and Amortization
9 2024E Depreciation, Depletion, and Amortization Purchase Price Accounting Impact on DD&A 2024E DD&A Purchase Price Step-Up D&A Intangible Asset Amort. Remaining D&A ▪ For 2024, Patterson-UTI expects to report Depreciation, Depletion, and Amortization expense of more than $1 billion ▪ Roughly 20% o
Slide 10: Key Takeaways
10 Differentiated business model with leading positions in both Drilling and Completions Integrated service model offers a unique opportunity to create value for customers and investors Predictable Capital Allocation Strategy Disciplined investment strategy with high-return investment opportunities,
Slide 11: Operational Excellence
Operational Excellence Efficiency Amplified by Integration
Slide 12: Drilling & Completions Industry Fundamentals
12 ▪ Industry Bifurcation: Top drilling contractors make up a substantial portion of the active super-spec rigs ▪ Equipment Differentiation: Tier 1 rig technologies enable maximum pad site efficiency and add value to the drilling process ▪ Returns-Focused Strategy: Providers with high-quality assets
Slide 13: Integration Advantage: Drilling Services and Products
13 Integration Advantage: Drilling Services and Products Patterson-UTI Drilling | Drilling Rigs Diverse rig fleet complete with innovative software solutions NexTier | Natural Gas Fueling, Well Cementing Integrated solutions unlocked through merger Ulterra | Drill Bits Leading provider of PDC drill
Slide 14: Integration Advantage: Completions Services
14 Integration Advantage: Completions Services Proppant Storage and Handling Maximum volume, precision blending Field Gas Conditioning Intelligent blending to maximize fuel cost savings Natural Gas-Enabled Frac Fleet Leading fleet of natural gas-powered Tier 4 and electric equipment Wireline Plug &
Slide 15: Industry Fundamentals: Completion Services
15 Industry Fleet Utilization Rate by Equipment Type1 Active Industry Fleets, U.S. Land, 3Q2024 Estimate Source: 1Patterson-UTI Estimates Next-generation natural gas-powered assets remain effectively sold out ▪ There is very little capacity to increase activity of premium natural gas-powered assets,
Slide 16: Power Services: Equipped for the Future of Power
16 Power Services: Equipped for the Future of Power DRILLING COMPLETIONS POWER DIGITAL INTEGRATION Patterson-UTI is leading innovation to optimize power from micro-grids and natural gas midstream for use in drilling, completions, and beyond 2024 Field Gas Patent Granted 2nd Generation Field Gas Tech
Slide 17: Power Solutions: NexTier's Natural Gas Fueling
17 Power Solutions: NexTier’s Natural Gas Fueling Power Solutions is a large-scale innovative and technology- driven diversified natural gas fueling solutions provider with a proven track record in US oil field markets. The differentiated technology and high-quality team has led to industry-leading
Slide 18: Electrical Controls, Automation, and Energy Management
18 Electrical Controls, Automation, and Energy Management Energy Automation Solutions Powered by the CORTEX® automation platform, delivering software solutions that monitor, automate, and optimize drilling rig power consumption for optimal fuel efficiency and reduced emissions. Electric Power System
Slide 19: End-to-End Digital Integration and Data-Driven Optimization
19 End-to-End Digital Integration and Data-Driven Optimization DRILLING COMPLETIONS POWER DIGITAL INTEGRATION Harnessing Data to Enable Lower Cost and Higher Impact Drilling & Completion Operations Automation & AI ▪ Simplify and reduce risk in daily operational tasks ▪ Enable repeatable execution in
Slide 20: Capital Allocation Framework
Capital Allocation Framework
Slide 21: Capital Allocation Framework
21 Organic Investing Strategy Targets Appx. 40% FCF Conversion Invest to protect and extend our operational advantage; Capex can be scaled in proportion to match opportunity set Strategic Allocation Target strong return on capital, increase shareholder return program, and/or further strengthen balan
Slide 22: Investment Grade Capital Structure
22 Financially Positioned for Through-Cycle Resilience TOTAL LIQUIDITY $688 M Includes cash and revolver as of 6/30/2024 LOW LEVERAGE <1 X Net Debt as of 6/30/2024 to Q2 Annualized Adjusted EBITDA CASH BALANCE $75 M Cash Position as of 6/30/2024 INTEREST COVERAGE >18 X Q2 adjusted EBITDA to Interest
Slide 23: Deliver a Repeatable Shareholder Return Program
23 $819 MILLION SHARE BUYBACK AUTHORIZATION1 ▪ For 2024 we expect to exceed our shareholder return target of 50% of our free cash flow – expect to return at least $400 million to shareholders this year ▪ Board of Directors has approved an $0.08 per share quarterly dividend for the prior eight consec
Slide 24: Track Record of Shareholder Returns
24 0% 2% 4% 6% 8% PTEN Peer Average A strong track record of shareholder returns Peer group includes HP, BKR, SLB, HAL, LBRT Cash Returned to Shareholders ($) millions Average Annual Shareholder Return as a % of Year-End Market Cap (%) Percent, 2018-2023 12024E assumes dividend continues at $0.08 pe
Slide 25: Delivering Value
Delivering Value
Slide 26: Sustainability as a Strategy
26 Sustainability as a Strategy Our Timeline of Innovation in Sustainability Our Vision: To safely and responsibly help provide the world with oil and gas for the products that make peoples’ lives better in a sustainable and profitable manner Find out more in our Sustainability Report at: https://es
Slide 27: Why invest in Patterson-UTI?
27 Differentiated service model Uniquely positioned as a leader in both U.S. shale drilling and completions, with an integrated service model that can add value for both customers and investors Leader in the high-growth oilfield power market The largest integrated frac plus fuels service provider in
Slide 28: Appendix
A PATTERSON-UTI
Slide 29: Reconciliation of Non-GAAP Financial Measures: Leverage Ratio
29 Reconciliation of Non-GAAP Financial Measures: Leverage Ratio (unaudited, dollars in thousands) Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization1 Three Months Ended June 30, 2024 Net income 11,621 Income tax expense 17,785 Net interest expense 16,046 Depreciation, depletion
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