National Energy Services Reunited Corp · NASDAQ:NESR
National Energy Services Reunited — SPAC Merger (November 2017)
30 slides from National Energy Services Reunited's SPAC merger presentation, Nov 20, 2017
Slide 1: Investor presentation National Energy Services Reunited Corp. November 2017
Investor presentation National Energy Services Reunited Corp. NASDAQ - NESR November 2017
Slide 2: Important notice
This presentation (the “Presentation”) is for information purposes only and is being delivered to you for the sole purpose of your consideration and evaluation of a potential investment in equity securities of National Energy Services Reunited Corp . (“NESR” or “the Company”) and does not constitute
Slide 3: Non-GAAP Financial Measures
Non - GAAP Financial Measures : This Presentation includes certain financial measures not presented in accordance with generally accepted accounting principles (“GAAP”) including, but not limited to, EBITDA and certain ratios and other metrics derived therefrom . NESR believes that these non - GAAP
Slide 4: Forward-Looking Statements
Forward - Looking Statements : This Presentation includes “forward - looking statements” regarding the Company and the target companies that reflect their current views and information currently available . This information is, where applicable, based on estimates, assumptions and analysis that mana
Slide 5: Proven Senior Leadership and Sponsors
5 Proven Senior Leadership and Sponsors
Slide 6: Transaction highlights
6 Transaction highlights ▪ National Energy Services Reunited Corp. (“NESR”) has agreed to acquire Gulf Energy SAOC (“GES”) and NPS Holdings Ltd (“NPS” o r “National Petroleum Services”) to be collectively named as National Energy Services Reunited Corp. (“NESR”) at the closing of th e contemplated t
Slide 7: Transaction structure
Transaction structure Source: 2017, 2018 and 2019 numbers based solely on NESR estimates. These figures may differ significantly from actual finali zed deal numbers until actual closing. As a result, investors should undertake their own analysis prior to making an investment. A dditionally, there ar
Slide 8: Key process milestones
8 Key process milestones Board Approval 11/11/2017 Transaction Announcement 11/12/2017 Obtain required regulatory approvals End 2017 - Q1 2018 Target closing End 2017 - Q1 2018 Transaction milestones
Slide 9: Targets detailed overview
Targets detailed overview Transaction overview Equity story 9
Slide 10: The combination will create the largest regionally focused oilfield services player
The combination will create the largest regionally focused oilfield services player NPS GES NESR ▪ Leading regional well services player ▪ Focus on local content ▪ Complementary service and product portfolio ▪ Potential for revenue and cost synergies ▪ Attractive partner for incremental M&A in regio
Slide 11: NESR is expected to compare favourably to its listed peers
11 NESR is expected to compare favourably to its listed peers Source: FactSet as of November 7, 2017 Note: NCS Multistage excluded from historicals as 2013 – 2016 financials are not available 1 Calculated as last reported net debt /estimated 2017 EBITDA Positioning vs. Key Peers Growth track record
Slide 12: NESR is expected to compare favourably to its listed peers (cont'd)
NESR is expected to compare favourably to its listed peers (cont’d) Source: FactSet as of November 7, 2017 ¹ Based on acquisition firm value (excluding potential earn - outs) and on estimated EBITDA 2017 of $157mm 12 20.6x 19.1x 15.9x 15.3x 15.1x 13.9x 12.7x FV/EBITDA 2017E Average: 16.1x 6.9x 1 Sig
Slide 13: NESR is expected to compare favourably to its listed peers (cont'd)
NESR is expected to compare favourably to its listed peers (cont’d) Source: FactSet as of November 7, 2017 ¹ Based on acquisition firm value (excluding potential earn - outs) and on estimated EBITDA 2018 of $200mm 13 12.8x 12.7x 11.5x 10.4x 10.1x 8.2x 7.5x FV/EBITDA 2018E Average: 10.5x 5.4x 1 Signi
Slide 14: Transactions compare favourably to precedent transactions in the sector
Transactions compare favourably to precedent transactions in the sector Source: MergerMarket, press releases, company filings Note: Average and median exclude NESR acquisition of GES and NPS 1 Metrics reflect the implied value and EBITDA of the combined entities NESR EV/EBITDA based on estimated 201
Slide 15: Equity story
Targets detailed overview Equity story Transaction overview 15
Slide 16: The combination will accelerate EBITDA growth through synergies and broad services
16 The combination will accelerate EBITDA growth through synergies, increased market share and a broad portfolio of services Unique equity story and demonstrable track record will drive premium valuation Unique exposure to high - growth MENA region 1 Proven and tested management team who have grown
Slide 17: The Middle East remains amongst the most profitable regions globally
17 The Middle East remains amongst the most profitable regions globally due to development costs at the bottom end of the curve ▪ Full - cycle break - even oil prices are among the lowest globally ▪ Activity levels expected to continue to grow even in a sub - $40/bbl environment Cost of supply¹ Sour
Slide 18: NESR's future growth story is supported by robust growth profile
18 NESR’s future growth story is supported by a robust growth profile across its key services and countries of operations… Source: Westwood Global Energy 1 Source: Baker Hughes, rig count for Kuwait, Saudi Arabia, UAE, Qatar, Oman Resilient and growing onshore rig market Middle East OFS spend by cou
Slide 19: Comprehensive provider of services with scalable platform
19 Comprehensive provider of services with scalable platform ▪ Integration of complementary businesses ▪ Footprint across key markets ▪ NOCs - focused and local positioning ▪ Substantial growth potential ▪ Middle East margins > North America ▪ Leverage management strength ▪ Leverage Board of Directo
Slide 20: NOC/IOC focused customer base – long-term contract structure
20 NOC/IOC focused customer base – long - term contract structure 3 Source: Company information Key NOC customers Large and diversified client portfolio providing operational stability and material growth upside Key IOC customers Diversified client portfolio Longstanding relationships with key opera
Slide 21: NPS and GES have demonstrated sector leading resiliency since 2013
21 NPS and GES have demonstrated sector leading resiliency since 2013 given strong service delivery and cost management 4 Growth Margins Source: NESR management, FactSet 1 Revenue and EBITDA CAGR 13A - 16A for groups defined as average revenue and EBITDA CAGR 13A - 16A for each group; Average EBITDA
Slide 22: Demonstrable track record of organic and inorganic growth
22 Demonstrable track record of organic and inorganic growth Source: Company information Note: Milestones stand for main service line introductions only for GES and main new locations of operations overtime only fo r N PS 5 264 328 369 428 437 2012 2013 2014 2015 2016 2004 Combined revenue ($mm) 200
Slide 23: Highly experienced management teams and supportive shareholder base
23 Highly experienced management teams combined with supportive pre - transaction shareholder base Supportive proforma shareholder base 1 Comments x x x x Strong and longstanding leadership with highly experienced executive management team Track record of successful strategic projects including intr
Slide 24: NESR – Strategy and Ambition
A unique opportunity to take part in creating a Middle - East bellwether with significant upside return potential NESR’s strategy to deliver superior returns and growth in shareholder value NESR – Strategy and Ambition 24 ▪ Create the leading regional MENA oilfield services player ▪ Leverage cost sy
Slide 25: Transaction overview
Transaction overview Target detailed overview Equity story 25
Slide 26: GES at a glance
26 GES at a glance Overview GES geographic presence and key clients Pre - transaction shareholder base ▪ Gulf Energy SAOC (“GES”) is a provider of high quality integrated oilfield service solutions in the Middle East and North Africa region, with a task force of ~1,200 people ▪ Structured as a holdi
Slide 27: GES at a glance (cont'd)
27 GES at a glance (cont’d) Business highlights Customer split of revenue Key services and 2016 revenue contribution Revenue split by geography 58% 11% 4% 27% MEDCO International expansion will reduce client concentration 41% Drilling equipment services Machining and repairs Rental of down hol
Slide 28: NPS at a glance
28 NPS at a glance Overview NPS geographic presence and key clients ▪ NPS Holdings Limited (“NPS”) is a leading regional provider of integrated energy services in the MENA and Asia Pacific regions ▪ Currently present in 12 countries across the MENASA region and through various regional subsidiaries
Slide 29: NPS at a glance (cont'd)
29 NPS at a glance (cont’d) Business highlights Key services and 2016 revenue contribution ~85% ~10% Coiled tubing services Cementing services Stimulation, pumping, nitrogen services Filtration and pipeline services Cased hole logging Slickline services Well Services and Intervention Wireline Loggin
Slide 30: NPS and GES EBITDA Reconciliation (UNAUDITED)
30 NPS and GES EBITDA Reconciliation (UNAUDITED) Source: Company/NPS/GES; Financial measures presented in accordance with IFRS/Local GAAP
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