Argan, Inc. · NYSE:AGX
Argan — Investor Presentation (December 2013)
29 slides from Argan's investor presentation, Dec 27, 2013
Slide 1: Argan, Inc.
AGAN, INC. June 2010 June 2011 December 2013
Slide 2: Disclaimer
Disclaimer All statements in this presentation that are not historical are forward- looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements may be identified by words such as "believe," "intend," "expect," "may," "could," "would,"
Slide 3: Investment Highlights
Investment Highlights Demonstrated track record of performanceSubstantial industry growth prospectsStrong backlog and bidding pipelineCompelling financial characteristicsExperienced management team
Slide 4: Company Overview
Company Overview Year founded - 1961Headquarters - Rockville, MDTicker - NYSE:AGXMarket cap (12/06/13) - $357 millionFY 2013 Revenue - $279 millionFY 2013 EBITDA - $37 millionYTD (10/31/13) Revenue - $168 millionYTD (10/31/13) EBITDA - $53 millionEmployees - 400Backlog at 10/31/13 - $832 million
Slide 5: Senior Management Team
Senior Management Team Rainer Bosselmann - Chairman and CEOArthur Trudel - Chief Financial OfficerRichard Deily - Corporate ControllerManagement has an established track record of creating value for the shareholders of Jupiter National, Inc. (AMEX:JPI), Arguss Communications, Inc. (NYSE:ACX) and Arg
Slide 6: Senior Gemma Management Team
Senior Gemma Management Team William F. Griffin, Jr. - Co-Founder & Chief Executive OfficerDaniel L. Martin - PresidentBill and Dan have more than 60 years combined experience in all facets of engineering, detailed design, procurement, construction management and other support services in the buildi
Slide 7: Business Overview
Business Overview Gemma Power Systems ("GPS") - provides engineering, procurement and construction ("EPC") services to power generation and renewable energy marketsGPS accounted for 96% of total revenues during the nine months ended October 31, 2013Southern Maryland Cable, Inc. ("SMC") - provides te
Slide 8: Industry Growth Drivers
Industry Growth Drivers Substantial capacity additions will be required to meet rising electricity demand as the US economy continues to recoverThe retirement of older and inefficient plants and coal- fired generation facilities will further drive investment in new gas fired generation capacity
Slide 9: Overview of GPS
Overview of GPS Acquired by Argan - December 2006Purchase price - $33.1 million$12.9 million in cash$20.2 million from issuance of 3.7 million sharesFunded in part by $8.0 million secured four year amortizing term loan, which has been paid-in-full.Cumulative EBITDA since acquisition - $207 millionSe
Slide 10: Revenue and EBITDA Growth
Revenue and EBITDA Growth GPS's revenue and EBITDA have remained strong since the acquisition by Argan in December 2006 Revenue for Years Ended January 31 * Represents YTD October 2013 only 2006 2007 2008 2009 2010 2011 2012 FY2013 *YTD October 2013 Full Time 48.6 134.4 180.4 202.3 209.8 174.9 132.5
Slide 11: GPS Track Record
GPS Track Record More than 10,000 megawatts of generating capacity installed and under contract on an EPC basis More than 435 megawatts of wind power facility development More than 370 million gallons per year of installed renewable fuels capacity 36 major turnkey engineering, procurement and constr
Slide 12: National Footprint
National Footprint GPS has the ability to provide EPC services to customers throughout the United States Historical Project Locations States in which GPS has completed projects.
Slide 13: Extensive Project Portfolio
Extensive Project Portfolio Power facilities - simple cycle solutionCPV Sentinel Energy Project A.L. Pierce Re-powering ProjectVandolah Power ProjectDeSoto County Power ProjectIndigo Energy FacilityLarkspur Energy FacilityRichmond County Phase I Power Monroe Power Project Richland Peaking Project Ro
Slide 14: Current Projects: Panda Liberty Energy Project
Current Projects Panda Liberty Energy Project - Panda Liberty, LLC (previously named Moxie Liberty) - design and construction of natural gas-fired power plant in Bradford County, PA825 MW natural gas-fired combined cycle electrical generating facilityJoint venture with Lane Construction. Gemma's sha
Slide 15: Current Projects: East Texas Electric Cooperative
Current Projects East Texas Electric Cooperative, Inc. (ETEC) - Woodville, Texas - engineer-procure-construct (EPC) contract to design and build a 49.9 MW biomass-fired power plant. Contract Value: $167 millionCommenced Project: May 2012Scheduled Completion: December 2014
Slide 16: U.S. Natural Gas Development
U.S. Natural Gas Development Argan is participating in Marcellus Shale Region development activities with the object of developing large- scale power plants. The approach is to take principal positions in the initial stages of development, secure the rights for an EPC contract for the large scale po
Slide 17: Renewable Energy - Alternative Fuels
Renewable Energy - Alternative Fuels Gemma Power Systems (GPS) has accepted the assignment to design and build facilities to produce alternative fuels. To date, GPS has performed the process design, detail engineering, procurement and construction of more than 370 million gallons per year of install
Slide 18: Renewable Energy - Wind and Solar
Renewable Energy - Wind and Solar Gemma Renewable Power (GRP) is well positioned to respond to our clients' needs for the installation of wind and solar projects throughout North America. GRP's integrated team of experienced professionals provides all the following elements of a turnkey installation
Slide 19: Competitive Landscape
Competitive Landscape Larger Projects / Traditional Fuels Smaller Projects / Alternative Fuels
Slide 20: Growth Strategy
Growth Strategy Establish additional strategic alliances in the EPC spaceMake additional strategic acquisitions that complement our unique market positionExploit long-term relationships throughout the industry to aggressively build backlog of traditional and renewable energy projectsMake strategic i
Slide 21: Backlog
Backlog Argan has significant contract backlog Historical Contract Backlog as of January 31 * * * 2007 2008 2009 2010 2011 2012 2013 Oct 31 2013
Slide 22: Investment Summary
Investment Summary Demonstrated track record of performanceSubstantial industry growth prospectsStrong backlog and bidding pipelineCompelling financial characteristicsExperienced management team
Slide 23: Financials: Consolidated Statements of Operations
Financials Consolidated Statements of Operations Three Months Ended October 31, Three Months Ended October 31, Three Months Ended October 31, Three Months Ended October 31, Three Months Ended October 31, Nine Months Ended October 31, Nine Months Ended October 31, Nine Months Ended October 31, Nine M
Slide 24: Financials: Consolidated Statements of Operations, continued
Financials Consolidated Statements of Operations, continued Earnings (loss) per share attributable to the stockholders of Argan: Continuing operations Basic $ 0.85 $ 0.44 $ 2.21 $ 1.24 Diluted $ 0.83 $ 0.43 $ 2.16 $ 1.21 Discontinued operations Basic $ -- $ -- $ -- $ (0.02 ) Diluted $ -- $ -- $ -- $
Slide 25: Reconciliation to EBITDA - Power Industry Services
Financials Reconciliation to EBITDA - Power Industry Services Reconciliation to EBITDA - Power Industry Services Reconciliation to EBITDA - Power Industry Services Nine Months Ended October 31, Nine Months Ended October 31, Nine Months Ended October 31, Nine Months Ended October 31, Nine Months Ende
Slide 26: Reconciliation to EBITDA - Continuing Operations
Financials Reconciliation to EBITDA - Continuing Operations Reconciliation to EBITDA - Continuing Operations Reconciliation to EBITDA - Continuing Operations
Slide 27: Consolidated Balance Sheets - October 31, 2013 & January 31, 2013
Financials Consolidated Balance Sheets - October 31, 2013 & January 31, 2013 Consolidated Balance Sheets - October 31, 2013 & January 31, 2013 Consolidated Balance Sheets - October 31, 2013 & January 31, 2013
Slide 28: Consolidated Balance Sheets, continued
Financials Consolidated Balance Sheets, continued - October 31, 2013 & January 31, 2013 Consolidated Balance Sheets, continued - October 31, 2013 & January 31, 2013 Consolidated Balance Sheets, continued - October 31, 2013 & January 31, 2013
Slide 29: Infrastructure Services Peer Group
Infrastructure Services Peer Group Infrastructure Services Peer Group