Team, Inc. · NYSE:TISI
Team — Investor Presentation (November 2018)
39 slides from Team's investor presentation, Nov 6, 2018
Slide 1: Investor Presentation – September 2018
Investor Presentation – September 2018 (NYSE: TISI) ©Copyright 2018. TEAM, Inc. All Rights Reserved.
Slide 2: Safe Harbor Statement
Safe Harbor Statement + Certain forward-looking information contained herein is being provided in accordance with the provisions of the Private Securities Litigation Reform Act of 1995. We have made reasonable efforts to ensure that the information, assumptions and beliefs upon which this forward-lo
Slide 3: TEAM at a Glance
TEAM at a Glance + Premier provider of specialized industrial services to a broad range of energy and industrial end markets + Our customers view our services as required for uptime and safe operations and not discretionary – vital to their ongoing operations + Broad and differentiated set of techno
Slide 4: Core Values
Core Values SAFETY FIRST / SERVICE PRIDE AND QUALITY ALWAYS INTEGRITY LEADERSHIP INNOVATION RESPECT TEAMWORK In everything we do Uncompromising Leading service Supports For our customers, Global teamwork standards of integrity quality, continuous growth for each other and and and ethical conduct pro
Slide 5: Key Investment Highlights
Key Investment Highlights Premier provider of + Provider of inspection and assessment, turnaround, and on-stream services for ~45 years Maintenance and + Broad and deep specialty of standard services and products portfolio Inspection Services + Cross-selling service and integrated solutions opportun
Slide 6: Agenda
Agenda + 7,300+ highly trained and experienced specialty Who We Are technicians delivering services locally through 200+ locations What We Do Market Dynamics OneTEAM Financial Highlights Driving Execution Excellence 6 ©Copyright 2018. TEAM, Inc. All Rights Reserved. ©Copyright 2018. TEAM, Inc. All R
Slide 7: Enterprise Legacy of Growth
Enterprise Legacy of Growth 1960 METALOCK LTD ACQUIRED 2007 MECHANICAL 2004 AITEC 2010 SERVICES ADDED 1980 COOPERHEAT- INSPECTION QUEST INTEGRITY TO COMPANY INITAIL PUBLIC MQS SERVICES GROUP, LLC OFFERINGS OFFERING ACQUIRED ACQUIRED ACQUIRED 1929 1973 1999 2006 2008 FURMANITE TEAM X RAY INSPECTION,
Slide 8: Leading Technological Advancements
Leading Technological Advancements 2008 2005 QUEST INTEGRITY 2013 1924 1929 TEAM INTRODUCES LAUNCHES SUITE OF TEAM INTRODUCES METHOD 21 REPORTER UT ILI TOOLS L-CATT, LDAR EUGENE CLAY FURMANITE SOFTWARE FOR QUALITY COMPLIANCE FURMAN DEVELOPS BECOMES FULL TEAM INTRODUCES AND COMPLIANCE ASSURANCE TICKE
Slide 9: High Standard of Safety
High Standard of Safety 2.00 1.87 Total Lost Time Incident Rate (TLIR) Total Recordabe Incident Rate (TRIR) 1.50 1.22 1.19 1.12 1.02 1.00 0.71 0.68 0.60 0.57 0.49 0.51 0.52 0.50 0.54 0.32 0.39 0.36 0.31 0.33 0.25 0.24 0.18 0.17 0.13 0.16 0.09 0.08 0.09 0.06 0.07 0.07 0.05 0.02 0.04 0.05 0.00 2002 20
Slide 10: Worldwide Footprint. Local Responsiveness.
Worldwide Footprint. Local Responsiveness. Employees 7,300+ Operational Countries 20 Total Locations 200 Global Support Centers 34 Corporate Headquarters Sugar Land, Texas Driving Execution Excellence 10 ©Copyright 2018. TEAM, Inc. All Rights Reserved. ©Copyright 2018. TEAM, Inc. All Rights Reserved
Slide 11: Geographic and Service Diversification Strength
Geographic and Service Diversification Strength Revenue by Segment Revenue by Geography Quest Integrity Inspection & RoW ($82 M) Europe 6% 7% Heat Treating 10% ($588 M) Canada United 49% 11% States 44% 73% Mechanical Services ($530 M) Global Footprint Key Benefits of Scale + Attract, develop and ret
Slide 12: Agenda
Agenda + 7,300+ highly trained and experienced specialty technicians Who We Are delivering services locally through 200+ locations + Provider of inspection and assessment, What We Do turnaround, and on-stream services for ~45 years Market Dynamics OneTEAM Financial Highlights Driving Execution Excel
Slide 13: Unparalleled Breadth and Depth of Solutions
Unparalleled Breadth and Depth of Solutions INSPECTION MAINTENANCE HEAT TREATING ASSET INTEGRITY SOLUTIONS & REPAIR SOLUTIONS MANAGEMENT SOLUTIONS SOLUTIONS Validate the integrity Eliminate the need for Ensure pinpoint Improve operational of materials, parts costly shutdowns with precision and therm
Slide 14: Enabling Digital Data-Driven Integration
Enabling Digital Data-Driven Integration Integrated Workflow - Collect, Assess and Repair (CAR) Repair or Asset Tagging High Quality Data Collect Data Replace Line Tracing Cross-Customer Inspection & Spatially Referenced Benchmarking Heat Treating Mechanical Recommend Maintenance Data Consistency Vi
Slide 15: Multi-Level Customer Relationship
Multi-Level Customer Relationship Nested/Resident Project/Turnaround Emergency/Call-out + On-site, full time personnel + Highly planned SOW’s + Personnel dispatched as + Field overhead billable + Location proximity highly needed + Performance based valuable + Expertise and proximity dependent + Regu
Slide 16: Leverage Size and Scale
Leverage Size and Scale Local Competitors ~7,300+ employees across 200 Insufficient resources to meet peak locations demands Adept at escalating from standard to Lack technicians and equipment specialty services Less location proximity increasing Ability to fully integrate solutions trav
Slide 17: Differentiating Engineered Technologies
Differentiating Engineered Technologies Proprietary Inspection Technologies and Software Solutions + Advanced Inspection – globally standardized inspection solutions + InVista – In-line Inspection (ILI) system for un-piggable pipelines and buried or inaccessible process piping MANTISTM external craw
Slide 18: Team Digital
Team Digital Team Digital is our proprietary platform that maximizes quality and efficiency through digitally enabled workflows Planning, Remote Dispatch, Management, QA/QC Driving Execution Excellence 18 ©Copyright 2018. TEAM, Inc. All Rights Reserved. ©Copyright 2018. TEAM, Inc. All Rights Reserve
Slide 19: Agenda
Agenda + 7,300+ highly trained and experienced specialty Who We Are technicians delivering services locally through 200+ locations + Provider of inspection and assessment, What We Do turnaround, and on-stream services for ~45 years + Diverse customer base across several large Market Dynamics industr
Slide 20: Industrial Services to Support Any Industry
Industrial Services to Support Any Industry REFINING PETROCHEMICAL PIPELINE OFFSHORE POWER CHEMICAL NUCLEAR MANUFACTURING AEROSPACE MINING PULP PAPER GOVERNMENT AUTOMOTIVE Driving Execution Excellence 20 ©Copyright 2018. TEAM, Inc. All Rights Reserved. ©Copyright 2018. TEAM, Inc. All Rights Reserved
Slide 21: Industrial Services Spend by Industry
Industrial Services Spend by Industry Petroleum Refining and Chemical Processing industries are projected to increase from 2017 to 2018 $10.2B $9.9B $9.2B $8.6B Power is a potential area for greater market penetration by Team Notes: IIR data filtered to Mechanical Completion, Maintenance Programs, L
Slide 22: Petroleum Refinery Industry U.S. Turnaround Maintenance Spend Forecast
Petroleum Refinery Industry U.S. Turnaround Maintenance Spend Forecast INPUT OUTPUT (Southwest U.S.A) Crude Prices WTI 321 Margin Brent 321 Margin Historical Turnarounds Future Turnarounds DOE EIA Inventories Independent Refiners Integrated Refiners Seasonality Trends Refinery Utilization Unit Costs
Slide 23: Long Standing Blue Chip Customers
Long Standing Blue Chip Customers 2017 Revenue 10% $1.2 Billion 20% Driving Execution Excellence 23 ©Copyright 2018. TEAM, Inc. All Rights Reserved. ©Copyright 2018. TEAM, Inc. All Rights Reserved.
Slide 24: Agenda
Agenda + 7,300+ highly trained and experienced specialty Who We Are technicians delivering services locally through 200+ locations + Provider of inspection and assessment, What We Do turnaround, and on-stream services for ~45 years + Diverse customer base across several large Market Dynamics industr
Slide 25: OneTEAM Introduction
OneTEAM Introduction + What is OneTEAM? – A transformational change effort identified by TEAM leadership focused on: + Revenue Enhancement + Operations Improvement + Center-Led Functions Cost Improvement – Development and implementation of processes, standards, and training – Enables greater coordin
Slide 26: Addressing the Change - OneTEAM Pillars
Addressing the Change - OneTEAM Pillars + Drive customer value through specialized services leading to above market growth + Increase efficiency with integrated operations and standards / quality + Create Center-Led Functions that are value added to enable operations and financial performance Revenu
Slide 27: Agenda
Agenda + 7,300+ highly trained and experienced specialty Who We Are technicians delivering services locally through 200+ locations + Provider of inspection and assessment, What We Do turnaround, and on-stream services for ~45 years + Diverse customer base across several large Market Dynamics industr
Slide 28: Financial Highlights
Financial Highlights + Q3 2018 – highest Quarter 3 Revenues since the Qualspec and Furmanite acquisitions – Inspection & Heat Treating + Consistently delivered 6% year over year Revenue growth over the last 3 quarters + Q3 2018 adjusted EBITDA margin increased to 9.5% compared to 7.7% in Q3 2017 Mec
Slide 29: Long History of Organic Growth and Strategic Acquisitions
Long History of Organic Growth and Strategic Acquisitions ($ in millions) Acquired Furmanite $1,600 ~15% CAGR for (February 2016) 2006 - 2017 $1,400 Acquired Qualspec (July 2015) $1,197 $1,200 $1,200 Acquired Quest Integrity (Nov 2010) $1,000 $926 $813 $800 $714 $624 $600 $545 $479 $498 $508 $400 $3
Slide 30: Balance Sheet Data
Balance Sheet Data ($ in millions) Dec-16 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Bank Credit Facility Debt $ 367 $ 163 $ 178 $ 176 $ 198 $ 183 Letter of Credit Outstanding $ 22 $ 23 $ 22 $ 23 $ 22 $ 23 Total Sr. Secured Debt $ 389 $ 186 $ 200 $ 199 $ 220 $ 206 Convertible Senior Notes Due 2023 1 $ - $ 2
Slide 31: Revenues and Adjusted EBITDA
Revenues and Adjusted EBITDA (in thousands) Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Revenues IHT 147,529 138,383 467,621 439,751 MS 119,011 130,768 400,890 385,154 Quest Integrity 24,316 15,916 68,619 58,972 290,856 285,067 937,130 883,877 Operating Incom
Slide 32: Key Performance Objectives for 2018
Key Performance Objectives for 2018 + TEAM is well positioned to benefit from overall market growth by leveraging our strengths: our people, technology, size & scale and our blue-chip client base + Strengthen our leadership position and reputation for safety, quality, and shareholder returns Safety
Slide 33: Investment Consideration
Investment Consideration 1 Premier provider of Maintenance and Inspection Services Long-standing 5 Poised for Diversified, 2 Growth Blue Chip Customer Base Deep Domain Driving Expertise 4 Execution Driving 3 Excellence Technology Advantage Driving Execution Excellence 33 ©Copyright 2018. TEAM, Inc.
Slide 34: Investor Relations
Investor Relations +1 281.388.5500 | IR@teaminc.com 13131 Dairy Ashford, Suite 600 | Sugar Land, Texas 77478 ©Copyright 2018. TEAM, Inc. All Rights Reserved.
Slide 35: Appendix Supplemental Financial Information
Appendix Supplemental Financial Information
Slide 36: Non-GAAP Financial Measures (Unaudited)
Non-GAAP Financial Measures (Unaudited) The Company uses supplemental non-GAAP financial measures which are derived from the consolidated financial information including adjusted net income (loss); adjusted net income (loss) per share, earnings before interest and taxes ("EBIT"); adjusted EBIT (defi
Slide 37: Revenue Reconciliation
Revenue Reconciliation $(000's) Reported FRM Total FY2016 Jan-Feb 2016 FY 2016 Inspection & Heat Treating 589 1 590 Mechanical Services 540 43 582 Quest Integrity 68 - 68 Total 1,197 44 1,240 Source: Company disclosures. Furmanite acquired in March 2016 hence prior 2 months shown to obtain a Reporte
Slide 38: Adjusted EBITDA and Free Cash Flow Reconciliation
Adjusted EBITDA and Free Cash Flow Reconciliation (in thousands) Driving Execution Excellence 38 ©Copyright 2018. TEAM, Inc. All Rights Reserved. ©Copyright 2018. TEAM, Inc. All Rights Reserved.
Slide 39: Adjusted EBITDA Reconciliation by Segment
Adjusted EBITDA Reconciliation by Segment (in thousands) Driving Execution Excellence 39 ©Copyright 2018. TEAM, Inc. All Rights Reserved. ©Copyright 2018. TEAM, Inc. All Rights Reserved.