Klx Energy Services Holdings, Inc. · NASDAQ:KLXE
Klx Energy Services — Investor Presentation (August 2023)
28 slides from Klx Energy Services's investor presentation, Aug 16, 2023
Slide 1: Investor Presentation August 2023
1 Investor Presentation August 2023
Slide 2: Disclaimer & Forward-looking Statements
2 Disclaimer & Forward-looking Statements Cautionary Statement on Forward-looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. This presentation includes forward-look
Slide 3: Company Overview
3 Company Overview
Slide 4: KLX Energy Services (KLXE) Overview
4 Rockies 28% Southwest 37% Midcon/Northeast 35% KLX Energy Services (KLXE) Overview Company Overview Areas of Operation Diversified Product Offering Diversified Business Model • Leading U.S. onshore provider of mission critical services for the full life-cycle of technically demanding wells across
Slide 5: KLXE / QES Merger Integration Success
5 KLXE / QES Merger Integration Success Strategic Fit ✓ Premier provider of drilling, completion, production and intervention solutions with a returns driven strategy ✓ Minimal customer overlap with significant cross-sell potential ✓ Positioned to participate in further industry consolidation People
Slide 6: A Transformed KLXE
6 A Transformed KLXE People Performance Asset Integrity Safety Customer Focus Profitability ✓ Veteran operators throughout the organization ✓ Deep technical expertise ✓ Transparent alignment of incentives ✓ Significant operating leverage ✓ Return on capital focus ✓ Performance culture ✓ Detailed KPI
Slide 7: Diversified and Complementary Product Service Offering
7 Diversified and Complementary Product Service Offering PSL1 Q2 2023 Rev. Contribution Rockies Southwest Northeast/ Mid Con Select Products & Services Directional Drilling 19% ✓ ✓ ✓ MWD, proprietary K-Series mud motor, directional electronics and other modules Accommodations 5% ✓ ✓ Living accommoda
Slide 8: Significant Operating Leverage Tied To Market Recovery
8 Significant Operating Leverage Tied To Market Recovery US Land Rig Count and KLXE Quarterly Adj EBITDA (Including Pre-merger Combined) Source: Company & Baker Hughes Rig Count. The Company’s results for the periods Q1’19 through Q1’20 are presented on a pre-merger combined basis, which is the sum
Slide 9: Greene's Acquisition Case Study
9 Greene’s Acquisition Case Study Cost Synergies ▪ Identified $2.0MM to $3.0MM recurring cost synergies ▪ Expect to realize savings within 12 months of transaction closing Accretive ▪ Expect the transaction to be accretive across all key metrics Deleveraging ▪ Greene’s had zero leverage and $1.7MM o
Slide 10: Top Operators Choose KLXE
10 Top Operators Choose KLXE ▪ Served over 760 unique customers in 2022 with no one customer accounting for more than 5% of 2022 revenue ▪ Diverse customer base – Top 10 2022 customers accounted for 30% of 2022 Revenue ▪ Significant leverage to the most active operators in the United States As of Q2
Slide 11: Profitability Continues to Improve
11 • Rapidly improving financial results as KLXE has grown back into the capital structure • Q2 2023 Revenue and Adj EBITDA of $234MM and $40MM, respectively Profitability Continues to Improve As of Q2 2023. Company disclosure. Q1 2023 includes only a partial month contribution from Greene’s. See Fr
Slide 12: Enhanced Capitalization & Leverage Profile
12 Enhanced Capitalization & Leverage Profile As of Q2 2023. Company disclosure Net Leverage Ratio reflects Last Quarter Annualized Adj EBITDA. See reconciliation on Slide 28 Net Debt & LQA Net Leverage Ratio (dollar amounts in millions) Current Capitalization Highlights $254 $226 $244 $202 1.7x 1.5
Slide 13: Go-Forward Strategy
13 Go-Forward Strategy Augment Balance Sheet Strength ▪ Continue to de-lever through a combination of EBITDA growth, free cash flow generation, debt reduction and consolidation Consolidation ▪ Believe KLX is the partner of choice for consolidation ▪ Greene’s acquisition is a blue-print by which KLX
Slide 14: Appendix
14 Appendix
Slide 15: Reconciliation of Consolidated Net Loss to Adjusted EBITDA (Loss)
15 Reconciliation of Consolidated Net Loss to Adjusted EBITDA (Loss) (dollar amounts in millions) Source: Company Disclosure Adj EBITDA Reconciliation *Previously announced quarterly numbers may not sum to the year-end total due to rounding. (1) Quarterly cost of sales includes $2.1 million of lease
Slide 16: Reconciliation of Consolidated Net Income (Loss) to Adjusted EBITDA (Loss)
16 Reconciliation of Consolidated Net Income (Loss) to Adjusted EBITDA (Loss) (dollar amounts in millions) Source: Company Disclosure Adj EBITDA Reconciliation (Continued) *Previously announced quarterly numbers may not sum to the year-end total due to rounding. (1) The one-time costs during the sec
Slide 17: Consolidated Net Income (Loss) Margin
17 Consolidated Net Income (Loss) Margin Reconciliation Source: Company Disclosure Consolidated Net Income (Loss) Margin Reconciliation (dollar amounts in millions)
Slide 18: Consolidated Adjusted EBITDA (Loss) Margin
18 Consolidated Adjusted EBITDA (Loss) Margin Reconciliation Source: Company Disclosure Consolidated Adjusted EBITDA (Loss) Margin Reconciliation (dollar amounts in millions) Q1’21 Q2’21 Q3’21 Q4’21 Q1’22 Q2’22 Q3’22 Q4’22 Q1’23 Q2’23 Adjusted EBITDA (loss) ............................. $ (9.4) $ 0.
Slide 19: Rocky Mountains Segment Adj EBITDA (Loss) Reconciliation
19 Reconciliation of Segment Operating Income (Loss) to Adjusted EBITDA (Loss) (dollar amounts in millions) Rocky Mountains Segment Adj EBITDA (Loss) Reconciliation Source: Company Disclosure
Slide 20: Southwest Segment Adj EBITDA (Loss) Reconciliation
20 Reconciliation of Segment Operating Income (Loss) to Adjusted EBITDA (Loss) Source: Company Disclosure (dollar amounts in millions) Southwest Segment Adj EBITDA (Loss) Reconciliation
Slide 21: Northeast/Mid-Con Segment Adj EBITDA (Loss) Reconciliation
21 Reconciliation of Segment Operating Income (Loss) to Adjusted EBITDA (Loss) Source: Company Disclosure (dollar amounts in millions) Northeast/Mid-Con Segment Adj EBITDA (Loss) Reconciliation
Slide 22: Segment Operating Income (Loss) Margin
22 Segment Operating Income (Loss) Margin Reconciliation Source: Company Disclosure Segment Operating Income (Loss) Margin Reconciliation (dollar amounts in millions)
Slide 23: Segment Adjusted EBITDA (Loss) Margin
23 Segment Adjusted EBITDA (Loss) Margin Reconciliation Source: Company Disclosure Segment Adj EBITDA (Loss) Margin Reconciliation (dollar amounts in millions)
Slide 24: SG&A Margin
24 SG&A Margin Reconciliation Source: Company Disclosure SG&A Margin Reconciliation (dollar amounts in millions)
Slide 25: Annualized Adjusted EBITDA (Loss)
25 Annualized Adjusted EBITDA (Loss) Reconciliation Source: Company Disclosure Annualized Quarterly Adj EBITDA (Loss) Reconciliation (dollar amounts in millions)
Slide 26: Free Cash Flow
26 Free Cash Flow Reconciliation Source: Company Disclosure Free Cash Flow Reconciliation (dollar amounts in millions)
Slide 27: Net Debt
27 Net Debt Reconciliation Source: Company Disclosure Net Debt Reconciliation (dollar amounts in millions)
Slide 28: LQA Net Leverage Ratio
28 LQA Net Leverage Ratio Reconciliation Source: Company Disclosure LQA Net Leverage Ratio Reconciliation (dollar amounts in millions)
KLX Energy Services Holdings — Investor Presentation (August 2023) on 6ix