Black Diamond Group Limited · TSX:BDI

Black Diamond — Investor Presentation (June 2022)

31 slides from Black Diamond's investor presentation, June 2022

  1. Slide 1: Investor Update

    INVESTOR UPDATE INVESTOR RELATIONS June 2022 © Black Diamond Group Ltd. All Rights Reserved investor@blackdiamondgroup.com

  2. 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

  3. 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

  4. 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 and improving returns MSS • • Strong free cash flow characteristics Long-lived rental assets Modular Space Solutions •

  5. Slide 5: Operating Overview

    Operating Overview Modular Space Solutions (MSS) Fleet $244 mm NBV 1 8,874 Units 1 Workforce Solutions (WFS) Fleet $141 mm NBV 1 6,879 Units 1 Consolidated Rentable Square Feet ~6.8 mm 250,298 TTM Total room nights booked2 $21.7 mm TTM Net Income or Profit $68.6 mm TTM Adjusted EBITDA 1,2,3 $399.2 m

  6. Slide 6: Revenue Diversity

    Revenue Diversity 6 © Black Diamond Group Ltd. All Rights Reserved

  7. 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 17.0 MSS: Modular Space Solutions 15.0 • Diversified rental stream through rental of 13.0 $mm modular buildings in Canada and U.S. 11.0 • Ancillary, Value

  8. Slide 8: MSS Overview

    MSS Overview MSS Rental Revenue • 8,874 units across 19 branches in North 17.0 America with attractive returns on long-lived 15.0 16.1 16.1 assets 15.3 14.6 13.0 13.9 • With added scale and additional product offering, return metrics are improving. $mm 11.0 11.3 Rental revenue growth expected to out

  9. Slide 9: WFS Overview

    WFS Overview WFS Rental Revenue • Includes large and small format 12.0 accommodation rentals, ancillary 10.0 10.7 11.2 10.8 surface rentals and services across Canada, U.S. and Australia. 8.0 8.2 8.6 • LodgeLink, the Company’s digital travel 7.5 Our WFS business $mm 6.0 6.7 platform is also within t

  10. Slide 10: LodgeLink Gaining Market Traction

    LodgeLink Gaining Market Traction LodgeLink leverages Black Multi-sided B2B Platform focused on crew travel Unique Corporate Customers • Efficiently connect the supply/demand of room and 700 642 Diamond’s extensive accommodation bookings for companies employing 600 544 knowledge of remote field crew

  11. Slide 11: LodgeLink - Room Nights Booked & Net Revenue

    LodgeLink - Room Nights Booked & Net Revenue Total Room Nights Booked 90,000 80,000 • Continued growth in unique customer accounts 70,000 60,000 50,000 • Growing share of travel wallet within existing 40,000 customer base 30,000 20,000 • Strong momentum into 2022 with strong 10,000 booking volumes e

  12. Slide 12: Significant Asset Coverage Against Debt

    Significant Asset Coverage Against Debt • Q1/2022 Net Debt1 of $156.6 mm and Long Term Debt of $160.5 remains well below hard asset coverage on a net book value and third-party appraisal basis • Asset Based Lending (“ABL”) facility extended out to fall of 2026. Average cost of debt in Q1/22 was 2.4%

  13. Slide 13: Financial Flexibility

    Financial Flexibility Leverage Ratio Net Debt/EBITDA (TTM as at last reported Quarter ) 5.0 4.00 4.5 3.50 4.0 3.00 3.5 2.50 3.0 2.00 2.5 1.50 2.0 1.00 1.5 0.50 1.0 0.00 0.5 BDI MSS Comparables WFS Comparables 0.0 Q2-20 Q3-20 Q4-20* Q1-21* Q2-21* Q3-21* Q4-21 Q1-21 Source: Factset Net Debt to Adjuste

  14. Slide 14: Strong Free Cash Flow Generation

    Strong Free Cash Flow Generation Free Cash Flow • Asset rental model has continued to 18 provide a strong base of Free Cash Flow1, generating over $13.5 million 16 in Q1/2022 and Cash flow from operating Activities of $13.0 million 14 12 • The company announced a quarterly 10 dividend of $0.015 per

  15. Slide 15: Growth Through Disciplined Capex

    Growth Through Disciplined Capex Organic Growth Capex • Annual organic growth capex of ~$35 to $45 mm after used asset sales • Realizing strong returns for new capital investment. Reported consolidated ROA1 of 17% in Q1/2022 • Vast majority of capex targeted for organic growth in MSS with opportunit

  16. Slide 16: Black Diamond Investment Attributes

    Black Diamond Investment Attributes  MSS fleet growth driven by ongoing organic expansion and acquisitions Growth  MSS EBITDA growth to outpace fleet growth driven by increasing rental revenue as a result of rising rates, strong utilization, economies of scale, VAPS and other service offerings  L

  17. Slide 17: Appendix

    Appendix 17 © Black Diamond Group Ltd. All Rights Reserved

  18. Slide 18: 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 • Lodge Services Revenue 18 © Black Diamond Group Ltd. All Rights Reserved

  19. Slide 19: Adjusted EBITDA Detail By Quarter

    Adjusted EBITDA1 Detail By Quarter Quarterly EBITDA Detail 30.0 25.0 19.7 20.0 17.5 17.9 15.0 13.3 13.5 11.1 9.9 9.9 9.8 10.0 5.0 0.0 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 (5.0) (10.0) Modular Space Solutions Workforce Solutions Total Consolidated Corporate 1. Non- GAPP financial mea

  20. Slide 20: Revenue Detail by Quarter

    Revenue Detail by Quarter Consolidated Revenue by Quarter 120.0 100.0 80.0 58.6 45.1 60.0 31.8 35.8 30.5 24.9 40.0 28.6 17.3 15.4 50.2 51.0 20.0 37.1 35.3 34.4 31.4 22.0 23.9 16.5 0.0 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 MSS WFS 20 © Black Diamond Group Ltd. All Rights Reserved

  21. Slide 21: Rental Utilization

    Rental Utilization MSS and WFS Rental Utilization • MSS rental fleet maintaining utilization above 80% 90% 80% • WFS improvement in utilization 70% supported by diversification of assets outside of western 60% Canada 50% 40% 30% 20% Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 MSS Utilizati

  22. Slide 22: MSS & WFS Fleet Overview

    MSS & WFS Fleet Overview MSS Fleet Unit Count 10,000 9,000 8,000 • Continued growth in MSS rental 7,000 fleet, supported by organic 6,000 5,000 investment and acquisitions 4,000 3,000 2,000 1,000 - Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 WFS Room Count 14,000 Canada US Australia • WFS camps

  23. Slide 23: MSS – Drivers Behind Rental Revenue Growth

    MSS – Drivers Behind Rental Revenue Growth MSS Rental Revenue 17.0 15.0 13.0 11.0 $mm 9.0 7.0 5.0 Average Rental Rate MSS Unit Count MSS Utilization $750 10,000 90% $700 9,000 85% $650 8,000 80% $600 7,000 75% $550 6,000 70% Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'

  24. Slide 24: MSS – VAPS Penetration

    MSS – VAPS Penetration VAPS as a % of Rental Revenue Excluding VAPS • Value Added Products & Services (VAPS) 16% revenue continuing to grow in line with 14% rental revenues 12% 10% • VAPS as a % of rental is down from 2020 8% due to an acquisition of units with little or 6% no VAPS contribution 4% 2

  25. Slide 25: 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

  26. Slide 26: 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

  27. Slide 27: 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

  28. Slide 28: 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

  29. Slide 29: LodgeLink - Value Proposition

    LodgeLink - Value Proposition • Assumptions: • Approximately 4,700 room nights @ $108/night • 3 rooms per transaction • results in 1,560 transactions per year (or 30 per week) • Assumes no additional savings on negotiated rates or direct billing 29 © Black Diamond Group Ltd. All Rights Reserved

  30. Slide 30: Non-GAAP & Supplementary Financial Measures

    Non-GAAP & Supplementary Financial Measures • Adjusted EBITDA is a non-GAAP financial measure, 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, amortizat

  31. Slide 31: Thank You

    THANK YOU INVESTOR RELATIONS © Black Diamond Group Ltd. All Rights Reserved investor@blackdiamondgroup.com

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