National Energy Services Reunited Corp · NASDAQ:NESR
National Energy Services Reunited — 11th Annual East Coast IDEAS Investor Conference (June 2021)
22 slides from National Energy Services Reunited's conference presentation, Jun 16, 2021
Slide 1: National Energy Services Reunited Corp. The National Champion of MENA
National Energy Services Reunited Corp. The National Champion of MENA June 2021 Sherif Foda Chairman and Chief Executive Officer
Slide 2: Safe Harbor and Other Disclaimers
Safe Harbor and Other Disclaimers This presentation (the “Presentation”) is for informational purposes only and does not constitute an offer to sell, a solicitation of an offer to buy, or a recommendation to purchase any equity, debt or other financial instruments of National Energy Services Reunite
Slide 3: NESR – Largest Indigenous OFS in the Region
NESR – Largest Indigenous OFS in the Region Iraq Bahrain UAE § Head office in Houston and regional offices across MENA and Asia Pacific § Operations Bases: 15 Countries Egypt § 5,500+ Employees USA Algeria Libya § 20 Product Lines India Chad Saudi Arabia § Clients Portfolio: 30+ Customers Indonesia
Slide 4: Global Demand Expected to Rebound into 2022
Global Demand Expected to Rebound into 2022 |4 Note: Assumes $70 crude StrictlySource: confidential – Do notJames IEA, Raymond reproduce or distribute Research Copyright NESR Corp.
Slide 5: OPEC+ Must Maximize Production by 2022
OPEC+ Must Maximize Production by 2022 |5 Note: Assumes $70 crude StrictlySource: confidential – Do notJames IEA, Raymond reproduce or distribute Research Copyright NESR Corp.
Slide 6: US Activity is highly dependent on Oil Price
US Activity is highly dependent on Oil Price |6 Strictly confidential – Do not reproduce or distribute Copyright NESR Corp. Source: IEA, Raymond James Research
Slide 7: Most Resilient, Lowest Cost Markets to Meet Increasing Demand
Most Resilient, Lowest Cost Markets to Meet Increasing Demand NESR is Exclusively Focused on Mission Critical Oil and Gas Regions Gulf Cooperation Council (GCC) is a More Resilient Onshore Rig Market¹ 350 GCC Rig Count 300 250 Rig Count Decline Mar-14 to Mar-21 200 GCC North America 150 -21% 100 50
Slide 8: NESR – We are unique
NESR – We are unique § Started as a SPAC in May 2017 Enhanced services portfolio § Agreed to merge National Petroleum WL WL Stim Coil Cem DM DTR SWT Fluids AL WS Services (NPS) and Gulf Energy OH CH SAOC (GES) in November 2017 NPS GES § Transaction closed June 2018 NESR § Trades under the “NESR” tic
Slide 9: Executing on Our MENA Consolidation Thesis
Executing on Our MENA Consolidation Thesis NESR Strategy 2021 Action Energy Company Acquisition § Build the “National Champion” of MENA Background § Cultivate relationships with major upstream operators across footprint § Action Energy is one of the leading indigenous oilfield services companies § D
Slide 10: NESR is a unique OFS play
NESR is a unique OFS play OFS… NESR “… is going to be affected long term In forecasts that predict a drastic shift away from Oil and 70% reduction in carbon emissions by 2050, the Middle East changes by the energy transition” is the major oil producer with the lowest cost/bbl, in countries where NES
Slide 11: Our Investment in New ESG IMPACT Initiative
Our Investment in New ESG IMPACT Initiative Our target return for investments in these initiatives will be substantially similar to those in the existing business segments The Need Our Strong Commitment and Objectives § Drive increased conversion of produced water to fresh water § Become a force for
Slide 12: Open Platform approach on Technology
Open Platform approach on Technology Strategic partnerships for R&D and portfolio expansion Rotary Steerable System Multiphase Flow Meter Perforation Systems Wireless Tools for Production Chemicals (RSS) (MPFM) (PERF) Slickline (CHEM) Advanced Production Well Head System for Next Gen Well Head Downh
Slide 13: NESR Oilfield Research and Innovation (NORI)
NESR Oilfield Research and Innovation (NORI) NORI’s model, akin to the larger technological changes we are seeing globally, will create an open platform for innovative technology companies in the upstream space to come to the Kingdom and will benefit the Saudi oil and gas industry - Dr. Mohammed Y.
Slide 14: Exceptional and Unmatched Growth to continue
Exceptional and Unmatched Growth to continue 1,213 On target to Growth in the worst surpass the +1B$ downturn in mark 25 years 992 CAGR 2 1% 834 658 9% CAGR 553 458 415 431 369 328 315 246 213 186 141 147 162 111 129 104 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Revenue ($mm) Analyst Analyst
Slide 15: and Significant Upside Potential
and Significant Upside Potential TEV/EBITDA 2021E TEV/EBITDA 2022E (1%) 4% 0% 0% (11%) 19% YOY Rev Growth* 17% 26% 10% 12% 24% 22% 14.7x 23.8x Significant 19.7x 10.3x valuation Significant 10.0x upside valuation 8.1x potential upside 12.8x 12.2x 6.3x 11.6x potential 5.3x 6.8x Equipment North Interna
Slide 16: Outperforming the Big 3 in Critical Markets
Outperforming the Big 3 in Critical Markets Why NESR? NESR Outperforms the Big 31 in International Revenue Growth Indexed to International Revenue ü Superior execution and efficiency 175 150 ü Leading edge products and techniques 125 100 ü Local content in workforce 75 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19
Slide 17: NESR beats the Big 3 in every metric…
NESR beats the Big 3 in every metric… Ø Superior projected financial performance 2020 – 2022 Revenue Change % 2022 EBITDA % 2022 Net Margin % 45.4% 26.0% 11.4% 22.2% 9.1% 18.4% 7.4% 14.1% 17.6% 4.1% 6.6% 6.4% OFS 1 OFS 2 OFS 3 NESR OFS 1 OFS 2 OFS 3 NESR OFS 1 OFS 2 OFS 3 NESR Ø Significant upside v
Slide 18: And beats the US Top Tier Independent Frac
And beats the US Top Tier Independent Frac Ø Also exceeding in projected financial performance 2020 – 2022 Revenue Change % 2022 EBITDA % 2022 Net Margin % 45.4% 26.0% 11.4% 34.0% 33.7% 20.4% 24.8% 13.1% 13.0% 2.8% 2.8% -0.9% OFS 4 OFS 5 OFS 6 NESR OFS 4 OFS 5 OFS 6 NESR OFS 4 OFS 5 OFS 6 NESR Ø Als
Slide 19: NESR is the First and Only NASDAQ listed MENA Energy Company
NESR is the First and Only NASDAQ listed MENA Energy Company
Slide 20: Adjusted EBITDA by Quarter
Adjusted EBITDA by Quarter (Non-GAAP reconciliation) NESR ($million) Q1 2021 Revenue 212.4 Operating Income 15.7 Depreciation and amortization 31.8 Other income/expense, net 0.7 Transaction, Integration and Start- Up Costs 2.0 Adjusted EBTIDA 50.2 Source: Company financial information as published i
Slide 21: 2019/2020 Adjusted EBITDA
2019/2020 Adjusted EBITDA (Non-GAAP reconciliation) NESR ($million) 2020 2019 Revenue 834.1 658.4 Net income (loss) 50.1 39.4 Depreciation and amortization 128.6 93.8 Finance cost 15.9 19.0 Tax 10.7 13.1 Charges & credits 7.9 20.7 Adjusted EBTIDA 213.2 186.0 | 21 As reported in quarterly earnings pr
Slide 22: Historical Adjusted EBITDA
Historical Adjusted EBITDA (Non-GAAP reconciliation) Adjusted EBITDA NPS financial results for 2013, 2014 are prepared under IFRS, and 2015-2017 are prepared under US GAAP; GES 2013-2017 financial results are prepared under IFRS. | 22 EBITDA is adjusted for impairment, which is not recognized as par