Hunting PLC · LSE:HTG
Hunting — Investor Day (September 2023)
124 slides from Hunting's investor day presentation, Sep 13, 2023
Slide 1: Hunting PLC - Capital Markets Day
HUNTING PLC - CAPITAL MARKETS DAY
Slide 2: Today's Agenda
Today’s Agenda Welcome Hunting 2030 Strategy and Investment Case Jim Johnson Perforating Systems Jason Mai Subsea Dane Tipton Advanced Manufacturing Scott George Questions and Answers Panel Coffee Break OCTG, Premium Connections and Accessories Jim Johnson, Scott George, Daniel Tan Energy Transition
Slide 3: Presenters
Presenters Jim Johnson Jason Mai Dane Tipton Scott George Chief Executive PERFORATING SYSTEMS SUBSEA OCTG AMERICAS & ADVANCED Managing Director, Hunting Titan Managing Director, Subsea Technologies MANUFACTURING Managing Director, North America Daniel Tan Sean O’Shea Stewart Barrie Bruce Ferguson OC
Slide 4: Hunting 2030 – a roadmap for robust profit growth and shareholder returns
Hunting 2030 – a roadmap for robust profit growth and shareholder returns 01 02 A compelling product, technology and Strong market fundamentals for manufacturing platform supported by strong oil and gas, non-oil and gas, geothermal IP and know-how and carbon capture sectors 03 04 Strong revenue grow
Slide 5: Strong revenue growth post-COVID
Strong revenue growth post-COVID Group financial performance 2020 – 2023e* 39% revenue growth delivered in 2022 1,000 100 >25% revenue growth projected for 2023* 900 90 800 80 700 70 725.8 EBITDA $m 600 60 626.0 7% EBITDA margin in 2022 Revenue $m 500 50 400 521.6 10 – 11% margin projected for 2023*
Slide 6: A diversified product portfolio to leverage energy and non-oil and gas growth to 2030
A diversified product portfolio to leverage energy and non-oil and gas growth to 2030 PERFORATING An international technology leader for well completions with Oil and gas SYSTEMS compelling IP, accessing all touch points of the well SUBSEA Products which deliver performance and cash flow faster, sup
Slide 7: A strategy to drive strong cash flows and returns
A strategy to drive strong cash flows and returns Revenue growth ambition EBITDA margin PERFORATING 2023 – 2025: CAGR c.10% SYSTEMS SUBSEA 2023 – 2025: CAGR c.26% OCTG Energy Transition 2023 – 2025: CAGR c.19% revenue ambition of $250 million p.a. by the end 14 – 16% by 2025 ADVANCED of the decade d
Slide 8: c.$2 billion revenue p.a. targeted by 2030
c.$2 billion revenue p.a. targeted by 2030 2022 Perforating OCTG Subsea Advanced Other Bolt-on 2030e Systems Manufacturing Manufacturing M&A Hunting PLC Capital Markets Day, 13 September, 2023 7
Slide 9: IP to drive innovation and competitiveness
IP to drive innovation and competitiveness Over 500 patents and trademarks across key technologies and geographies Strong R&D focus Competitive edge Market leadership Hunting PLC Capital Markets Day, 13 September, 2023 8
Slide 10: Established operating footprint for energy today...
Established operating footprint for energy today... Our operations and markets 18 8 sites sites Conventional oil and gas basins 4 Unconventional oil and gas basins sites Hunting PLC Capital Markets Day, 13 September, 2023 9
Slide 11: ...and tomorrow
...and tomorrow Our operations and markets 18 8 sites sites High-intensity geothermal and 4 sites carbon capture projects Hunting PLC Capital Markets Day, 13 September, 2023 10
Slide 12: Blue chip customer base across multiple critical markets
Blue chip customer base across multiple critical markets Hunting PLC Capital Markets Day, 13 September, 2023 11
Slide 13: ESG & Sustainability – skilled employees driving quality and HSE
ESG & Sustainability – skilled employees driving quality and HSE Manufacturing reject rate Strong culture 0.30% based on highly Leading 0.25% 0.24% skilled and Quality 0.20% trained Assurance 0.15% 0.13% 0.13% workforce 0.10% 0.05% 0.00% 2020 2021 2022 Reject Rate Robust Recordable incident rate / f
Slide 14: Continued improvement on key ESG metrics driving client loyalty
Continued improvement on key ESG metrics driving client loyalty Renewable energy purchased Strong culture 60% based on highly Leading 50% 50% skilled and Quality 40% trained Assurance 30% workforce 20% 20% 10% 16% 12% 8% 0% 2019 2020 2021 2022 2030 target Committed Robust Scope 1 and 2 GHG emissions
Slide 15: Strong market fundamentals to 2030 and beyond
Strong market fundamentals to 2030 and beyond Steady global oil and Deepwater / ultra Energy transition Key non-oil and gas gas demand to 2050 deepwater to see markets indicating markets, including strong growth robust growth to 2050 aviation, commercial for both geothermal space, defence and and ca
Slide 16: Robust oil and gas demand and committed industry capex
Robust oil and gas demand and committed industry capex Worldwide oil demand by region (2022 – 2030) Upstream capex by category (2022 – 2030) 120 600 100 500 80 400 mmbopd $bn 60 300 40 200 20 100 0 0 2022 2023 2024 2025 2026 2027 2028 2029 2030 2022 2023 2024 2025 2026 2027 2028 2029 2030 US - L48 R
Slide 17: Significant under-investment in production indicating c.20% supply gap
Significant under-investment in production, coupled with ongoing field depletions, indicating a c.20% supply gap Global oil supply Shale oil production profile 120 6.6 21.6 101.8 17.6 100 2.6 80 mmbopd 60 bopd 40 20 0 2023 Demand Demand growth by 2033 Non-OPEC projects Non-OPEC projects Supply gap b
Slide 18: Deepwater expenditures seeing high growth to the end of the decade
Deepwater expenditures seeing high growth to the end of the decade Deepwater and ultra deepwater capex by region (2022 – 2028) Top ten deepwater and ultra deepwater fields by capex (2020 – 2030) 100 Venus 90 Abadi 80 Sakarya 70 Mero 60 $bn Gorgon Project 50 Browse 40 Mozambique LNG (Area 1) 30 Rovum
Slide 19: Significant carbon capture capacity planned to end of decade
Significant carbon capture capacity planned to end of decade supporting the energy transition Planned CCUS capacity additions by year of announced start-up Over 200 Mtpa capacity is targeted for start-up post-2030 Capacity (Mtpa) 772 Mtpa capacity by 2030 221 Mtpa capacity by 2025 Source: Wood Macke
Slide 20: Non-oil and gas markets seeing impressive growth
Non-oil and gas markets seeing impressive growth providing visibility of opportunities for Advanced Manufacturing US defence budget Medical devices Commercial space market 900 1,200 The medical electronics 850 market was estimated at 842 1,000 $81.6 billion in 2020 and is 1,000 800 expected to hit $
Slide 21: A resilient long-term growth strategy
A resilient long-term growth strategy Oil and gas • Continued introduction of critical technologies • Broaden product offering through R&D and M&A DRIVE CASH FLOW Energy transition • Align technology portfolio and supply chain with this high growth, DELIVER accessible market • Leverage global presen
Slide 22: Core competencies for high-growth markets
Core competencies for high-growth markets Current market New market Hunting PLC Capital Markets Day, 13 September, 2023 21
Slide 23: A focused strategy and strong investment proposition
A focused strategy and strong investment proposition 01 A compelling portfolio of IP, technology 02 Blue chip customers for multiple 03 Long-term resilience through and manufacturing end-markets diversification and growth in energy transition 04 Exposure to high-growth markets, 05 HSE, Quality Assur
Slide 24: Perforating Systems in a Changing World
PERFORATING SYSTEMS IN A CHANGING WORLD Hunting PLC Capital Markets Day, 13 September, 2023 23
Slide 25: Perforating Systems – technology leader for global well completions
Perforating Systems – technology leader for global well completions Perforating Systems revenue 2020 – 2023e Comprehensive product offering supported 300 by strong IP 250 251.9 200 150 181.7 154.5 Market leader in components and 100 systems technology 50 0 2020 2021 2022 2023e Revenue - $m Analyst c
Slide 26: Strong growth opportunities in conventional and unconventional resource developments
Strong growth opportunities in global conventional and unconventional resource developments WIRELINE THRU TUBING TUBING CONVEYED • Vertical open and cased-hole wells • Offshore and onshore rigs CONVENTIONAL • Natural, unstimulated extraction • Long Guns • Perforating via Wireline (WL), Thru Tubing (
Slide 27: High performance technology – leading the North America market through innovation
High performance technology – leading the North America market through innovation TM HT71 Detonator H-3 V3.0 CF EquaFracTM OP PowerSet Guns HT Det Cord Switch Charges Recon 2011 2023 ENERGETICS Good Hole, Deep Penetrator EQUAfracTM EQUAfracTM OP (Oriented Perforating) INSTRUMENTS ControlFireTM Recon
Slide 28: Comprehensive and unmatched product offering to give market leadership
Comprehensive and unmatched product offering to give market leadership MANUFACTURER Integrated Service TITAN Comp 1 Comp 2 Comp 3 Company PCE - standard and coated line Product Automated Shooting Panel with Acquisition manufacturing Modular Gun & Hardware and services Release Tools offering Modular
Slide 29: Market leading reputation in North America
Market leading reputation in North America 2023 Improved HSE 49 Hunting Titan 38 0 Wellmatics 11 Differentiated technology 21 GEODynamics 16 13 Quality and reliability Core Lab/Owen 9 7 DynaEnergetics 10 Availability and delivery Halliburton 5 0 10 20 30 40 50 60 Shaped Charges Perforating Guns Cust
Slide 30: IP – the key to market leadership
IP – the key to market leadership IP by benefit to customer 185 granted patents representing 50 product lines and granted patent families active in 12 countries 34% Other Product Improvement 43% Internal Cost Savings Oriented Perforating Rental Tools 13% 90 pending applications representing 5% 5% Sa
Slide 31: Blue chip customers from wireline operators to E&Ps
Blue chip customers from wireline operators to E&Ps Hunting PLC Capital Markets Day, 13 September, 2023 30
Slide 32: Continued perforating systems growth across North America
Continued perforating systems growth across North America Hunting Technology Technology Introduction E&P Company Hunting Systems Products Complete Systems & PLG Service Providers 3rd Party Gun Components System Providers Service Providers Complete Systems & PLG with Internal Gun Systems Increase rec
Slide 33: North America – leading the technology and market evolution
North America – leading the technology and market evolution and delivering growth Conventional Unconventional Technology trends – horizontal integration • Hunting’s technological • Hunting’s unconventional • Integrated completion initiatives for technological initiatives activities at the well site
Slide 34: Compelling international market opportunity
Compelling international market opportunity – target revenue growth to $60m – $70m p.a. by 2030 Hunting aims to leverage its brand power International unconventional frac stages to expand its ControlFireTM platform into growing international unconventional 14,000 markets, while continuing to penetra
Slide 35: Perforating Systems – technology leader for global well completions
Perforating Systems – technology leader for global well completions 01 Hunting's high technology product offering 02 Strong IP will continue to support Hunting’s 03 Automation and horizontal integration of will lead the global market to 2030 value-added systems and components well site activities to
Slide 36: Subsea in a Changing World
SUBSEA IN A CHANGING WORLD Hunting PLC Capital Markets Day, 13 September, 2023 35
Slide 37: Subsea technology leader – strongly positioned to increase scale
Subsea technology leader – strongly positioned to increase scale Subsea revenue 2020 – 2023e Differentiated technologies: market-leading 100 90 position driving significant revenue growth 80 70 60 69.8 69.0 50 58.8 Diverse product offering delivering 40 cash flows across the asset lifecycle 30 20 10
Slide 38: Our unique competencies will deliver above market growth in deepwater
Our unique competencies will deliver above market growth rates in an accelerating deepwater market Deepwater and ultra deepwater capex by region (2010 – 2028) Significant deepwater project sanctioning 100 activity from 2023 – 2028 90 80 70 60 $bn 50 40 30 Surging greenfield & brownfield commitments
Slide 39: Portfolio of technologies presents multiple market touchpoints
Portfolio of technologies presents multiple market touchpoints SURF Technology • Titanium & Steel Stress Joints Intervention & Controls Technology – Decommissioning Services Components • 10k & 15k Hydraulic Intervention • Metal Seal Couplings • AOR Decommissioning • Production Control Valves • Chemi
Slide 40: Subsea controls technology – dominant market leader
Subsea controls technology – dominant market leader Metal Seal Hydraulic Couplings • Technology leader – used by all Tier 1 OEMs • 37 years of field history • +2 million installations globally • Commanding market position with high barriers to entry – low risk of substitution Production Control Valv
Slide 41: SURF technology – driving operational efficiencies
SURF technology – driving operational efficiencies Outstanding acquisition Sole supplier of TSJs for offshore riser applications with 28-year track record of success No FPSO draft constraint (TSJ can operate above water) Eliminate HSE risk and cost associated with personnel near the splash zone dur
Slide 42: Tieback & production technology redefining subsea architecture
Tieback & production technology enhancing asset returns by redefining subsea architecture Proprietary Technology Flow access module – FAM Faster, lower cost Subsea tiebacks Complements standard Subsea Production System Hardware enabling project specific technologies Defer capex No need to commit to
Slide 43: Aftermarket solutions – Life of Field revenue generation
Aftermarket solutions – “Life of Field” revenue generation Deepwater services – strong value coupled with “Life of Field” contracts Flow Intervention Services Decommissioning Services • 10k/15k field proven system • Patented anchor hub • Compact and modular hydraulic system • Attic oil recovery – 10
Slide 44: IP and execution experience – key to market leadership
IP and execution experience – key to market leadership Extensive library of intellectual property underpins position as market leader Strong technology footprint • Product design & engineering analysis • Manufacturing process trade secrets • Specialised welding & materials engineering 160 patents •
Slide 45: Trusted supplier to some of the world's largest producers
Trusted supplier to some of the world’s largest producers and service companies Major E&P Independent E&P Tier 1 OEMs Stress joints, Hydraulic Stress Joints, Hydraulic Couplings & Specialty Couplings & FAM Valves modules Stress Joints, Hydraulic Couplings, Chemical Hydraulic Couplings & Metering Val
Slide 46: Massive customer lifetime value opportunity
Massive customer lifetime value opportunity Initial Order Future Field Development Hunting PLC Capital Markets Day, 13 September, 2023 45
Slide 47: Subsea solutions built on proven domain expertise
Subsea solutions built on proven domain expertise – delivering significant profits & cashflows Customer benefits • Faster first oil • Capex reductions • System level flexibility • Simplified field management • Enhanced field economics Hunting benefits • Capture incremental market share • Greater sca
Slide 48: Subsea – opportunity to realise significant financial growth
Subsea – opportunity to realise significant financial growth 01 Significant incremental market share as we expand our 02 Strong IP and unique customer relationships across leadership position through organic and inorganic growth multiple subsea arenas provides defensible competitive advantage, which
Slide 49: Advanced Manufacturing in a Changing World
ADVANCED MANUFACTURING IN A CHANGING WORLD Hunting PLC Capital Markets Day, 13 September, 2023 48
Slide 50: Advanced Manufacturing – unique engineering capabilities
Advanced Manufacturing – unique engineering capabilities to lead non-oil and gas expansion Advanced Manufacturing revenue 2020 – 2023e Four differentiated businesses to drive non-oil 100 and gas diversification 90 80 70 74.3 75.1 60 50 59.6 Unique engineering capabilities to drive 40 new market entr
Slide 51: Businesses which deliver revenue diversification
Businesses which deliver revenue diversification Current market New market Hunting PLC Capital Markets Day, 13 September, 2023 50
Slide 52: Non-oil and gas markets seeing impressive growth
Non-oil and gas markets seeing impressive growth providing visibility of diversification opportunities for Advanced Manufacturing US defence budget Medical devices Commercial space market 900 1,200 The medical electronics market 850 was estimated at $81.6 billion 842 1,000 in 2020 and is expected to
Slide 53: Key certifications leveraging commercial and government contract work
Key certifications leveraging commercial and government contract work Certification Title or Scope ISO9001:2015 / AS9100:2016 Quality Management System ISO13485:2016 Medical devices — Quality management systems ISO9001:2015 / AS9100D Quality Management System Conventional Machining as a Special Proc
Slide 54: Compelling energy and non-oil and gas client base
Compelling energy and non-oil and gas client base Hunting PLC Capital Markets Day, 13 September, 2023 53
Slide 55: Electronics – a world leader in exotic alloy printed circuit boards
Electronics – a world leader in exotic alloy printed circuit boards processing and high temperature circuit manufacture Hunting PLC Capital Markets Day, 13 September, 2023 54
Slide 56: Electronics – driving new medical and defence printed circuit boards
Electronics – driving new medical and defence high performance printed circuit boards Electronics revenue 2020 – 2023e 60 Momentum building since H2 2022 as chip supply chain constraints ease 50 40 $m 30 35.5 35.9 31.1 20 Medical and defence sales building as 10 drive into new markets accelerates 0
Slide 57: Dearborn – unique engineering capabilities for critical end-use applications
Dearborn – unique engineering capabilities for critical end-use applications Spline milling Deep hole drilling Bottle boring Gun drilling Robotic shot peening Hunting PLC Capital Markets Day, 13 September, 2023 56
Slide 58: Dearborn – leading aviation, commercial space, and defence revenue growth
Dearborn – leading aviation, commercial space, and defence revenue growth Dearborn revenue 2020 – 2023e 45 Specialist manufacturing demands retention 40 40.5 of skilled engineers and fixed asset base, 35 35.8 capability retained through COVID 30 31.9 25 $m 20 15 10 5 ITAR compliance secured in 2017,
Slide 59: SHP – mission critical capabilities for end-use applications
SHP – mission critical capabilities for end-use applications • Precision machining of high alloy complex parts for the subsea industry • Deep hole, drilling capabilities • Plunge and wire EDM • Multi axis milling machines • Expert machining for extended turning and deep hole boring Hunting PLC Capit
Slide 60: Cumberland Additive Capabilities – accessing 3D manufacturing
Cumberland Additive Capabilities – accessing 3D manufacturing opportunities across multiple sectors 3D printing markets 80 70 69.5 60 50 $bn 40 • Metal Powder Bed Fusion • Plastic selective laser sintering 30 29.2 • CNC machining • Metal finishing 20 • Design engineering support 17.4 10 • Series pro
Slide 61: Advanced Manufacturing – unique engineering capabilities to lead
Advanced Manufacturing – unique engineering capabilities to lead non-oil and gas revenue expansion 01 Precision engineering for mission 02 Unique manufacturing capabilities 03 High growth end-markets, critical products where failure is attracting blue chip customers particularly in North America not
Slide 62: Questions and Answers
A compelling technology and manufacturing platform to deliver c.$2 billion revenue by 2030 Perforating Systems to grow materially on the international stage supported by stable North American market Subsea, a core growth area, QUESTIONS building on critical technologies and M&A AND ANSWERS Advanced
Slide 63: Oil Country Tubular Goods in a Changing World
OIL COUNTRY TUBULAR GOODS IN A CHANGING WORLD Hunting PLC Capital Markets Day, 13 September, 2023 62
Slide 64: OCTG – An independent global provider of connections and accessories
OCTG – An independent global provider of connections and precision engineered accessories for all resource types OCTG revenue 2020 – 2023e Multi-channel OCTG suppliers providing cost agility 400 350 300 250 264.7 Comprehensive connection solutions for global markets 258.8 $m 200 150 172.5 100 High m
Slide 65: OCTG – a critical product for the global energy industry
OCTG – a critical product for the global energy industry Global OCTG market demand Global demand for OCTG nearing 18 pre-COVID levels at c.16 Mtpa 16 14 12 North America accounts for c.40% of global consumption million tonnes 10 8 6 International markets are growing strongly 4 driven by energy secur
Slide 66: High performance connections delivered for all resource types
High performance connections delivered for all resource types WEDGE-LOCKTM SEAL-LOCKTM TEC-LOCKTM Hunting PLC Capital Markets Day, 13 September, 2023 65
Slide 67: Driving innovation in a changing market
Driving innovation in a changing market Conventional Deepwater/shale CCUS/Geothermal Acquired Commence Introduction of Commence Continued testing and SEAL-LOCKTM supply of TEC-LOCKTM supply of qualification of new OCTG to geothermal technology for CCUS and Geothermal Launch of OCTG to Eden Geotherma
Slide 68: OCTG – A key revenue driver to 2030
OCTG – A key revenue driver to 2030 01 OCTG – an independent, major product line 02 Hunting's broad-based connections technology for the global energy industry platform delivers for all resource types 03 Agile, low-cost product development strategy, 04 Across global operations, c.19% revenue leading
Slide 69: OCTG Americas in a Changing World
OCTG AMERICAS IN A CHANGING WORLD Hunting PLC Capital Markets Day, 13 September, 2023 68
Slide 70: OCTG Americas – A major strategic presence across the US and Canada
OCTG Americas – A major strategic presence across the US and Canada OCTG Americas revenue 2020 – 2023e Loyal customer base to support strong revenue 200 growth outlook 180 160 140 159.9 120 $m 100 116.9 80 99.4 Unique global supply chain provides cost-efficient 60 40 solutions for customers 20 0 202
Slide 71: TEC-LOCK a critical industry solution delivering strong cash flows
TEC-LOCK™ a critical industry solution delivering strong cash flows Revenue – $m 45 40 35 30 25 20 15 10 5 0 2017 2018 2019 2020 2021 2022 2023e Source: Company • In 2012 Hunting commissioned an in-house test facility • Since introduction, TEC-LOCKTM has generated greater than for rapid connection d
Slide 72: Continued production growth driving robust demand
Continued production growth driving robust demand US L48 oil and NGL production by key plays (2022 – 2027) US L48 oil production growth by key plays (2022 – 2027) 20 18 16 14 12 Million bopd 10 8 6 4 2 0 2022 2023 2024 2025 2026 2027 2022 Permian Other 2027 supply (incl. conventional) supply L48 NGL
Slide 73: Ongoing production declines in unconventional wells drive new drilling
Ongoing production declines in unconventional wells continues to drive new drilling momentum bopd Source: EIA Hunting PLC Capital Markets Day, 13 September, 2023 72
Slide 74: Loyal customers supported by our premium service offering
Loyal customers supported by our premium service offering Hunting PLC Capital Markets Day, 13 September, 2023 73
Slide 75: Unique global supply chains deliver value to clients
Unique global supply chains deliver value to clients • Commercial offering based on PIPE MILLS independence from pipe mills and distributors • Critical and unique component of the Oil and Gas Supply Chain • USP based on tailored technology and service • Demand for technology shapes the well design a
Slide 76: Strategically aligned locations with strong drilling outlook
Strategically aligned locations with strong and resilient drilling outlook Hunting PLC Capital Markets Day, 13 September, 2023 75
Slide 77: Strong growth in South America supporting huge revenue opportunity
Strong growth in South America supporting huge revenue opportunity Deepwater and ultra deepwater capex by region (2022 – 2028) Top ten deepwater and ultra deepwater fields by capex (2020 – 2030) 100 Venus 90 Abadi 80 Sakarya 70 Mero 60 $bn Gorgon Project 50 40 Browse 30 Mozambique LNG (Area 1) 20 Ro
Slide 78: Well completion revenues seeing large uplift driven by Brazil and Guyana
Well completion revenues seeing large uplift driven by Brazil and Guyana Annual projected revenue 45 40 40 35 30 25 25 20 $m 20 15 15 9 10 4 4 5 0.5 0 2019 2020 2021 2022 2023 2024 2025 2030 Source: Company Significant growth projections across Key product drivers Conventional South America • Specia
Slide 79: OCTG Americas – broad based domestic and international opportunities
OCTG Americas – broad based domestic and international opportunities supporting strong medium-term revenue growth 01 Americas' energy market projected 02 Hunting’s connection technology 03 Mission critical accessories for robust growth for the medium continues to broaden, which drives manufacturing
Slide 80: OCTG International in a Changing World
OCTG INTERNATIONAL IN A CHANGING WORLD Hunting PLC Capital Markets Day, 13 September, 2023 79
Slide 81: OCTG International – A platform aligned with high growth end-markets
OCTG International – A business platform closely aligned with high growth end-markets OCTG International revenue 2020 – 2023e Strategically located premium OCTG 200 manufacturing hubs 180 160 140 147.8 120 $m Driving US technology into international drilling markets 100 98.9 80 including Middle East
Slide 82: Strategically located manufacturing hubs to service international markets
Strategically located manufacturing hubs to service international markets Singapore Area: 5,400sqm Capacity: 5,000mtpa Indonesia Area: 36,000sqm Capacity: 60,000mtpa China Area: 40,000sqm Capacity: 100,000mtpa India Area: 18,300sqm Capacity: 50,000mtpa Hunting PLC Capital Markets Day, 13 September,
Slide 83: Key strategic partnerships delivering value to clients
Key strategic partnerships delivering value to clients STRATEGIC MILL APAC DELIVER TO PARTNERSHIPS MANUFACTURING HUBS GLOBAL CUSTOMERS Indonesia, Southeast Asia, Oceania, Middle East & Africa Wuxi – China Nashik – India China, Central Asia, Middle East, Africa, South America & Oceania Singapore Bata
Slide 84: Working with Asia Pacific's leading oil and gas companies
Working with Asia Pacific’s leading oil and gas companies Hunting PLC Capital Markets Day, 13 September, 2023 83
Slide 85: Asia Pacific OCTG addressable market
Asia Pacific OCTG addressable market OCTG addressable market 6,000 5,000 CAGR 4.5% 4,000 $m 3,000 2,000 1,000 0 2023 2024 2025 2026 2027 2028 2029 2030 Source: Spears & Associates/Company China Middle East Asia Pacific Africa Source: Spears & Assoicates / Company Hunting PLC Capital Markets Day, 13
Slide 86: India – accessing new markets by early mover alliance
India – accessing new markets by early mover alliance Gateway to robust First fully-fledged, One-stop shop Increased product Fully integrated OCTG growth markets premium offering widest range of offering, in tandem with supply chain of India, Middle East manufacturing hub OCTG and accessories strong
Slide 87: OCTG International – exposure to high growth end-markets
OCTG International – exposure to high growth end-markets 01 International OCTG platform 02 Critical supply channels 03 Strategically located hubs mitigate leverages Hunting's connection providing cost efficiencies to geopolitical risk technology to rest-of-world markets blue chip customer base 04 Al
Slide 88: Energy Transition in a Changing World
ENERGY TRANSITION IN A CHANGING WORLD Hunting PLC Capital Markets Day, 13 September, 2023 87
Slide 89: Energy Transition – Strong technology base and critical supply chain channels
Energy Transition – Strong technology base and critical supply chain channels for high-growth geothermal and carbon capture markets Good growth in geothermal orders, for premium connection OCTG in recent years Strong legislation driving underlying markets Immediate opportunities with current product
Slide 90: Geothermal market outlook across North America, Europe and Asia Pacific
Geothermal market outlook supported by numerous projects across North America, Europe and Asia Pacific Geothermal Energy Installed geothermal capacity (MW) • Geothermal energy is a 'wells 25,000 driven' market with rapidly growing CAGR 10% 21,991 demand for higher grade material 20,245 20,838 19,532
Slide 91: Carbon Capture – strong global legislative drivers
Carbon Capture – strong, global legislative drivers supporting near-term revenue and profit potential Carbon Capture Planned CCUS capacity additions by year of announced start-up • Widely considered by global authorities to be a vital part of their Net Zero strategies Over 200 Mtpa capacity is targe
Slide 92: Geothermal – high value technology required to address project complexity
Geothermal – high value technology required to address project complexity Geothermal extraction technologies are going through a step change from conventional geothermal to high-tech “unconventional geothermal” technologies providing opportunities to cross sell OCTG and perforating products Geotherm
Slide 93: Geothermal – 30% CAGR projected for OCTG to end of decade
Geothermal – 30% CAGR projected for OCTG to end of decade North America OCTG demand for geothermal wells in selected countries 16 14.62 14 12.03 12 9.88 10 000 tonnes 7.78 8 5.91 5.57 6 5.36 4.23 4 2 0 2023 2024 2025 2026 2027 2028 2029 2030 13 Cr Group 1 Group 2 Group 3 Group 4 Ni Alloy Super Duple
Slide 94: CCUS CRA OCTG – further rapid growth in the global market
CCUS CRA OCTG – further rapid growth in the global market Global OCTG demand for CCUS by grade 140,000 133,478 120,000 100,000 tonnes 80,000 74,731 68,301 63,244 60,000 40,000 34,465 28,928 31,082 20,000 19,437 0 2023 2024 2025 2026 2027 2028 2029 2030 13Cr Group 2 Group 3 S13Cr Super Duplex • CCUS
Slide 95: A low risk, high growth strategy
A low risk, high growth strategy IMAGE TO COME: ALISON TO ADVISE High-value technology offering Build supply chain partnerships • Short-term strategy to focus on OCTG and connections sales • Long-term agreements – critical CRA raw material supply • High potential for Perforating Systems technology i
Slide 96: Hunting's products ready for the market
Hunting’s products ready for the market NEW PRODUCT • API RP 5C5 CAL IV qualified • ISO/PAS12385 TWCCEP qualified Seal-Ring SEAL-LOCKTM XD Corrosion (SLXD) Barrier SEAL-LOCKTM FLUSH-SR-GL SEAL-LOCKTM FLUSH-SR- SEAL-LOCKTM XD – Perforating Systems: for CO2 GRE Lined LOD FLUSH CASING ISO/PAS 12835 TWC
Slide 97: Secured critical supply chains for CRA OCTG
Secured critical supply chains for CRA OCTG Global CRA OCTG – Suppliers by capacity Total capacity per year = 78,000 tonnes* • Current oil and gas demand for CRA is over 50k tonnes per year Abu Dhabi • Incremental demand from CCUS and Geothermal for 22 Chrome and 25 Chrome OCTG expected to exceed 25
Slide 98: Jiuli: A key partner for the next decade
Jiuli: A key partner for the next decade • 10-year Strategic Alliance Agreement signed • SEAL-LOCKTM XD Connection technology • Mill potential to increase premium connection OCTG supply by additional 20k tonnes per year • Only two competitors can match Jiuli for supply of 25 Chrome and Inconel OCTG
Slide 99: Novel technology for new markets
Novel technology for new markets • Hunting and CRA-Tubulars are joining forces to supply the North America market with Titanium Composite Tubing – corrosion resistant alternative OCTG technology • Five-year Collaboration Agreement signed – Hunting has secured exclusive manufacturing and distribution
Slide 100: Energy Transition – well positioned for high growth markets
Energy Transition – well positioned for high growth markets 01 Hunting well positioned for fast growth 02 Portfolio of OCTG technologies and 03 Strategic partnerships with Jiuli and Geothermal and CCUS markets precision manufacturing capabilities CRA-Tubulars provide critical supply provides early a
Slide 101: New Technologies in a Changing World
NEW TECHNOLOGIES IN A CHANGING WORLD Hunting PLC Capital Markets Day, 13 September, 2023 100
Slide 102: Accessing innovation and new technology
Accessing innovation and new technology Accelerates Facilitates the Supports the commercialisation Group’s entry into Group's engagement of new technologies new sectors and with energy transition product lines Hunting PLC Capital Markets Day, 13 September, 2023 101
Slide 103: TEK-HUB success stories
TEK-HUB success stories 01 Identify 02 Evaluate 03 Develop 04 Commercialise Titanium Composite Tubing Organic Oil Recovery Helios Micro-Hydro Anti-corrosion, enabling CCUS Enhancing existing production Scalable renewable energy Hunting PLC Capital Markets Day, 13 September, 2023 102
Slide 104: Organic Oil Recovery – game changing enhanced oil recovery
Organic Oil Recovery – game changing enhanced oil recovery Targeting $15 million p.a. in revenue by 2025 and $30 million p.a. by 2030 2019 2019 2019 2019 OOR establishes 1st North Sea 1st European OOR opens HQ in Aberdeen, UK Application Application office in the Middle East 2020 2020 2020 2020 1st
Slide 105: Blue chip interest and current field delivery
Blue chip interest and current field delivery 01 LAB TEST 02 PILOT TEST 03 FIELD ROLL OUT Hunting PLC Capital Markets Day, 13 September, 2023 104
Slide 106: OOR – extended asset life and increased cashflow
OOR – extended asset life and increased cashflow SINGLE WELL PROFILE 1ST OOR INJECTION 2ND OOR INJECTION 3RD OOR INJECTION 4TH OOR INJECTION PRODUCTION Decline curve Decline curve indicated Enhanced production through Reducing the need for new drilling well near end of life OOR extending well life (
Slide 107: International project reach and engagement
International project reach and engagement Hunting PLC Capital Markets Day, 13 September, 2023 106
Slide 108: New Technologies – facilitating entry into new sectors and product lines
New Technologies – facilitating entry into new sectors and product lines 01 TEK-HUB is a platform to accelerate the identification, 02 OOR is rapidly establishing itself as a high value evaluation, and commercialisation of new technology product solution for customers with brown-field developed by t
Slide 109: Financial Framework
FINANCIAL FRAMEWORK Hunting PLC Capital Markets Day, 13 September, 2023 108
Slide 110: Attractive investment case
Attractive investment case 01 Revenue projected to grow to 02 EBITDA margins increasing to c.15% 03 c.$325 million free cash flow c.$1.3 billion p.a. by 2025 driven by by 2025 with further progression generation by 2025 current market momentum, and to by 2030 >$1 billion cumulative free cash flow c.
Slide 111: Strong period of recovery and growth
Strong period of recovery and growth H1 2023 H2 2022 H1 2022 $m $m $m REVENUE 478 390 336 EBITDA 48.7 28.4 23.6 ADJUSTED PROFIT BEFORE TAX 23.1 7.7 2.5 ORDER BOOK 530 473 326 Half year 2023 highlights • Revenue up 42% on H1 2022 • EBITDA margin now >10% as volumes increase along with selected price
Slide 112: Future growth underpinned by record order book and tender pipeline
Future growth underpinned by record order book, growing tender pipeline and strong market fundamentals Order book by product Order book by year of delivery $22m $13m $26m $30m $101m $104m $248m OCTG 2023 Advanced Manufacturing 2024 Subsea 2025 $370m Perforating Systems $146m 2026+ Other Manufacturin
Slide 113: c.$2 billion revenue p.a. targeted by 2030
c.$2 billion revenue p.a. targeted by 2030 726 2022 Perforating OCTG Subsea Advanced Other Bolt-on 2030e Systems Manufacturing Manufacturing M&A c.13% of non-oil and gas sales by 2025 and c.25% by 2030 Offshore capex to double by 2028 South America to deliver strong Energy Transition to be a major M
Slide 114: Delivering a more efficient business platform
Delivering a more efficient business platform Efficiency 2020 – 2022 − Reduced fixed costs by $40 million p.a. − Disposed of EMEA OCTG pipe trading business − Divested high capex/low cash generating US drilling tools into joint venture − Consolidated Singapore facilities from three to one − Exited h
Slide 115: EBITDA margin growth to 14–16% through efficiencies and operating leverage
EBITDA margin growth to 14 – 16% through increased efficiencies and operating leverage Fixed cost 14 – 16% 16% Operational take out Pricing and leverage/volumes 14% operational 12% efficiencies 10 – 11% Portfolio EBITDA margin improvements 10% 8% 7% 6% 4% 2% 1% 0% 2021 2022 2023e 2025e Expect simila
Slide 116: Driving strong balance sheet efficiency
Driving strong balance sheet efficiency 80% Working Capital Targets: 70% 75% − Inventory days: 130 days 60% − DSO: 75 days − DPO: 45 days Working capital/Annualised revenue 50% 48% Working capital optimisation programmes to deliver 40% 44% 42% further improvements 35% 30% 20% 10% 0% 2020 2021 2022 H
Slide 117: Generating >$325 million of FCF by 2025
Generating >$325 million of FCF by 2025 500 2023 – 2025 450 c.$50m Targeting free cash flow 400 c.$100m conversion of 70% 350 $150m ABL Cash + ABL = $375 million 300 capacity for M&A and c.$130m $m 250 c.$480m shareholder distributions $25m opening cash 200 >$325m 2023 – 2030 Ambition EBITDA to FCF
Slide 118: Capital allocation policy
Capital allocation policy 01 02 03 04 Invest in Dividends Value accretive Additional the business Progressive M&A Shareholder Capex and dividend policy Disciplined Distributions investment in approach to valuation organic growth Target of 1.0 – 1.25 x 10% growth per annum Target sectors include Surp
Slide 119: Guidance for 2023 and 2024
Guidance for 2023 and 2024 Product Group 2023 Forecast 2024 Forecast EBITDA Margin EBITDA Margin OCTG 10 – 12% Stable Perforating Systems 11 – 13% Improving Subsea 8 – 10% Improving Advanced Manufacturing 9 – 12% Improving Other Manufacturing 5 – 7% Stable EBITDA: $96m – $100m EBITDA: $125m – $135m
Slide 120: Key deliverables
Key deliverables 01 Revenue projected to grow 02 EBITDA margins increasing to c.15% 03 c.$325 million free cash flow to c.$1.3 billion p.a. by 2025, driven by 2025 with further progression generation by 2025 by current market momentum, by 2030 >$1 billion cumulative free cash flow and to c.$2 billio
Slide 121: Questions and Answers
Global OCTG businesses growing strongly across all regions based on broad based technology High margin accessories / well completion businesses benefiting from strong South American growth International OCTG growth led by early QUESTIONS advantage in India and buoyant Middle East / Asia Pacific mark
Slide 122: Final comments
Final comments 01 A diversified product and technology 02 c.$2 billion revenue p.a. by 2030 and 03 c.$325 million of cumulative free cash offering to deliver growth to 2030 an EBITDA margin of c.15% by 2025 flow by 2025 c.$1 billion of cumulative free cash flow by 2030 04 05 06 Targeted ROCE of c.15
Slide 123: Glossary
Maneane 2030 PRE ENGINEERING GLOSSARY 3D Three-dimensional LNG Liquefied Natural Gas AGS Advanced Geothermal System m Million AOR Attic Oil Recovery M&A Mergers and Acquisitions APAC Asia Pacific MEA Middle East and Africa bn Billion mmbopd Millions Barrels Of Oil Per Day bopd Barrels of Oil per Day
Slide 124: 264.7 12.8 5% 172.5 (7.4) (4%) 258.8 16.2 6% 213.4 24.1 11% 154.5 6.4
264.7 12.8 5% 172.5 (7.4) (4%) 258.8 16.2 6% 213.4 24.1 11% 154.5 6.4 4% 181.7 8.5) 5%) 251.9 27.3 11% 126.8 13.7 11% 69.8 4.8 7% 58.8 4.7) 8%) 69.0 3.4 5% 42.5 3.2 8% 74.3 1.9 3% 59.6 0.7) 1%) 75.1 0.9 1% 53.1 4.5 8% 62.7 0.2 - 49.0 (3.4) (7%) 71.0 4.2 6% 42.0 3.2 8% 626.0 26.1 4% 521.6 3.1) 1%) 72