Patterson-uti Energy, Inc. · NASDAQ:PTEN
Patterson-uti Energy — Barclays CEO Energy-Power Conference 2022
41 slides from Patterson-uti Energy's conference presentation, Sep 7, 2022
Slide 1: Patterson-UTI Energy, Inc. Barclays CEO Energy-Power Conference
Patterson-UTI Energy, Inc. Barclays CEO Energy-Power Conference September 6-7, 2022
Slide 2: Forward Looking Statements
Forward Looking Statements This material and any oral statements made in connection with this material include "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Statements made which provide the Company’s or management’s intentions
Slide 3: Market Update
Market Update Market fundamentals are strong as demand is increasing and industry supply is constrained Strong demand for drilling and pressure pumping equipment and services • Customers indicating demand for more rigs than PTEN can provide this year • Recent oil price volatility has not had an impa
Slide 4: Patterson-UTI Segments
Patterson-UTI Segments DRILLING PUMPING DIRECTIONAL DATA ANALYTICS POWER RENTALS RELIABILITY Onshore contract Full-service pressure Comprehensive Space flight Electrical Large selection of API-certified drilling drilling in U.S. and pumping focused on suite of directional navigation engineering, equ
Slide 5: Leading Provider of Critical Path Services
Leading Provider of Critical Path Services ~50% of E&P total well spend includes services provided by Patterson-UTI Drilling Services Completion Services 35% of total shale well cost1 60% of total shale well cost1 1. Estimated well cost data provided by Rystad Energy 5
Slide 6: Patterson-UTI Segment Synergies
Patterson-UTI Segment Synergies Breadth of our service offerings provides us with Deeper customer relationships Greater market intelligence Technical collaborations across businesses Shared infrastructure for data analytics 6
Slide 7: Patterson-UTI Marketing Synergies
Patterson-UTI Marketing Synergies Strong Customer Alignment Between Contract Drilling and Pressure Pumping Percentage of Pressure Pumping Revenues from Contract Drilling Customers1 80% 68% 68% 58% 2019 2020 2021 1H22 1 Percentage of pressure pumping revenues from customers that also utilized PTEN ri
Slide 8: Contract Drilling
Contract Drilling PATTERSON-UTI DRILLING COMPANY LLC
Slide 9: Patterson-UTI Drilling
Patterson-UTI Drilling WHERE WE ARE NOW OUR HISTORY 1978 2001 2006 2015 2017 2018 2021 - = - TODAY Patterson Patterson eel 8 PTEN acquires PEN acquires PTEN acquires figemceneclimy © PTEN acquires Drilling formed (snes ged Rig Warrior Rig Seventy Current Power [EEReRMMEMem Pioneer Energy UTI Energy
Slide 10: What is a Tier-1, Super-Spec Rig?
What is a Tier-1, Super-Spec Rig? Patterson-UTI is a market and technology leader Mast rated for at least 750,000 pound hookload 1,500 hp elevated drawworks for more room under rig floor High pressure circulating system (7,500 psi) Third mud pump for greater hydraulic horsepower Multi-well pad capab
Slide 11: Patterson-UTI Drilling: The market is tight!
Patterson-UTI Drilling The market is tight! Total U.S. Rig Fleet Active U.S. Rigs1 Utilization Tier-1, Super-Spec 117 112 96% Super-Spec 55 12 22% Total Super-Spec 172 124 72% AC-Powered APEX® Rigs 12 5 42% Total U.S. Land Rig Fleet 184 129 70% • Industry utilization of Tier-1, Super-Spec rigs is ve
Slide 12: U.S. Drilling Margins per Operating Day
U.S. Drilling Margins per Operating Day Upside remains to prior peak margins U.S. Drilling Average Adjusted Gross Margin per Operating Day1 $12,820 $9,390 $7,170 $6,260 $6,310 $5,450 2014 AC rigs only 2Q21 3Q21 4Q21 1Q22 2Q22 (Estimated) 2 1. Adjusted gross margin is defined as revenues less direct
Slide 13: Pressure Pumping
Pressure Pumping MUNIVERSAL
Slide 14: Universal Pressure Pumping
Universal Pressure Pumping 14
Slide 15: Digital Transformation
Digital Transformation Remote operations, enhanced analytics • Operational data aggregation and equipment health monitoring • Condition-based decision-making coupled with predictive analytics Edge automation • Automated pump controls and fuel optimization provide safer, more reliable and consistentl
Slide 16: Technical Expertise and Collaboration
Technical Expertise and Collaboration Engineered solutions • Changes to completion design increased frac intensity and improved stimulated reservoir volume while lowering costs • Remote simul-frac operation cut completion time by 38% for Permian customer • >30% reduction in treatment schedule deviat
Slide 17: Technical Expertise and Collaboration
Technical Expertise and Collaboration Intelligent fluid chemistry • Domain experts formulate frac chemistry • Real-time water rheology with friction reducing performance • Environmentally friendly formulations Customer value • Optimizing frac fluid chemistry has lowered well completion costs and imp
Slide 18: Directional Drilling and Data Analytics
Directional Drilling and Data Analytics
Slide 19: MS Directional
MS Directional A leading provider of directional drilling services Strong reputation for the reliability and durability of downhole performance motors and measurement-while-drilling (MWD) tools Remote MWD operations with reduced personnel are standard on all directional drilling jobs 19
Slide 20: Superior QC
Superior QC Space flight navigation algorithms ™ ™ Improved well placement Better steering to target zones Better wellbore quality 20
Slide 21: EcoVerse™
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Slide 22: PTEN Sustainability Firsts
PTEN Sustainability Firsts 22
Slide 23: Natural Gas Generators, Dual Fuel Frac, Lithium Batteries
100% Natural Gas Dual Fuel Frac Lithium Batteries on Generators on Spreads and Drilling Drilling Rigs Drilling Rigs Rigs Hi-Line Power Automated Engine Management Software 23
Slide 24: Natural Gas Powered Engines on Drilling Rigs
Natural Gas Powered Engines on Drilling Rigs Offering fuel flexibility and utilizing local infrastructure Substituting natural gas for higher-priced diesel helps to reduce fuel costs Cleaner burning natural gas helps to reduce emissions PTEN is a leader in rigs capable of using natural gas as a fuel
Slide 25: EcoCell™
EcoCell™ Optimizing efficiency and reducing the carbon footprint of our rig • Leveraging stored energy helps to optimize fuel efficiency and reduce fuel costs. • Reduced fuel consumption helps to reduce emissions. • Patterson-UTI is a leader in the use of lithium batteries on drilling rigs. 25
Slide 26: Hi-Line Electrical Power
Hi-Line Electrical Power Current Power designed and manufactured utility substation • Patterson-UTI provides in-house electrical engineering, hardware packaging, and installation services to power our rigs from electric utility lines • This full-service offering enables our customers to utilize an o
Slide 27: Engine Automation
Engine Automation Automating efficient engine management to optimize fuel savings and emission reduction • Automation to start and stop engines as needed to meet fluctuations in rig power demand • Helps to reduce fuel costs and emissions by optimizing the average genset load and decreasing the overa
Slide 28: Power Management Dashboard
Power Management Dashboard Real time remote monitoring of rig fuel consumption and emissions Monitors real time rig power usage to effectively manage fuel consumption and reduce fuel costs Interactive analytical tools allow monitoring of 40 different engine data fields (pressures, temps, speed, alar
Slide 29: Natural Gas Powered Frac Spreads
Natural Gas Powered Frac Spreads Improved fuel emissions, optimized consumption Dual-fuel equipment capable of instantaneous substitution up to 85% Majority of frac spreads are dual-fuel >18K dual-fuel frac stages Saved >23MM gal diesel 29
Slide 30: Financials
Financials @\PATTERSON-UTI 4
Slide 31: Focused on Shareholder Returns
Focused on Shareholder Returns PTEN has returned more than $1 billion to shareholders in the last 10+ years Cash Returned to Shareholders ($ in millions) Dividends Buybacks $287.9 $200.6 $192.3 $102.6 $71.8 $66.8 $40.0 $47.5 $27.2 $23.1 $21.9 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022E 3
Slide 32: Capital Allocation
Capital Allocation MAINTAIN STRONG CAPITAL SPENDING SHAREHOLDER RETURNS BALANCE SHEET • Primarily focused on • Focused on maintaining • While no near-term maintenance, which a stable dividend with debt maturities, increases with activity increases when opportunistically build levels economics allow
Slide 33: Strong Financial Position
Strong Financial Position ~1.5x Net Debt to Adjusted EBITDA forecast by end of 2022 • Net debt of $864 million at June 30, 2022 No near-term debt maturities at June 30, 2022 • $510 million 3.95% senior notes due 2028 • $349 million 5.15% senior notes due 2029 • $25 million under revolving credit fac
Slide 34: No Near-Term Debt Maturities
No Near-Term Debt Maturities Debt Maturity Distribution ($ in Millions) 600 $510 500 400 $349 300 200 100 $25 0 2022 2023 2024 2025 2026 2027 2028 2029 At June 30, 2022, we had $25 million outstanding under our $600 million revolving line of credit that matures in 2025 ($550 million available after
Slide 35: Environmental & Social Sustainability
Environmental & Social Sustainability
Slide 36: Patterson-UTI Core Values
Patterson-UTI Core Values Safety and Environment The safety of our employees and the protection of our environment is a cornerstone, and we are committed to providing a safe, incident-free work environment for all. Operational Excellence We partner with our customers to achieve their goals, through
Slide 37: Environmental
Environmental Air Quality We utilize natural gas engines, dual-fuel equipment and other technologies that reduce our air emissions Water Quality We strive to conduct our drilling and completion activities in a manner that protects the quality of ground and surface water Land Use We employ spill prev
Slide 38: Social
Social Our people are our most important asset and our greatest strength Health and Safety • Our goal is to provide an incident-free work environment. The safety of our employees and others is our highest priority. • We regularly audit and review our HSE performance in all of our businesses. Diversi
Slide 39: Patterson-UTI
@ PATTERSON-UTI 4 ree, Qepartenson-u) = QUNIVERSAL —_B$GSpiectional suerorgc = -<LcuRRENT § ——great plains
Slide 40: Appendix
Appendix PATTERSON-UTI
Slide 41: Non-GAAP Financial Measures
Non-GAAP Financial Measures U.S. Drilling Average Adjusted Gross Margin (unaudited, dollars in thousands) 2Q 2022 1Q 2022 4Q 2021 3Q 2021 2Q 2021 Revenues $ 285,258 $ 239,683 $ 215,121 $ 157,925 $ 141,732 Direct operating expenses $ (181,784) $ (165,339) $ (161,870) $ (111,500) $ (100,070) Less depr
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