Nabors Industries Ltd. · NYSE:NBR
Nabors Industries — Investor Presentation (December 2010)
20 slides from Nabors Industries's investor presentation, Dec 16, 2010
Slide 1: Investor Presentation December 15th, 2010
Investor Presentation December 15th, 2010 Presenter: Denny Smith Director, Corporate Development President, Nabors Alaska Drilling
Slide 2: Forward Looking Statements
Forward Looking Statements We often discuss expectations regarding our markets, demand for our products and services, and our future performance in our annual and quarterly reports, press releases, and other written and oral statements. Such statements, including statements in this document incorpor
Slide 3: Nabors Operational Map
Nabors Operational Map 13 JACK-UPS 8 Drilling 5 Workover 3 BARGE RIGS 38 PLATFORM RIGS 24 Workover/Re-Drilling 14 Drilling 728 LAND WORKOVER RIGS 554 LAND DRILLING RIGS Actively Marketed Rigs Only As of September 30, 2010 DRILLING INSTRUMENTATION TOP DRIVE MANUFACTURING OILFIELD SERVICES
Slide 4: A Conservative and Flexible Financial Position
A Conservative and Flexible Financial Position Cash & Securities (1) Cash & Securities (1) $809,917 $809,917 $809,917 Accounts Receivable Accounts Receivable 1,002,974 1,002,974 1,002,974 Working Capital (1) Working Capital (1) 304,404 304,404 304,404 Property, Plant and Equipment, Net Property, Pla
Slide 5: Capital Structure Progression
Capital Structure Progression In $ millions Debt EBITDA (1) Debt / EBITDA @ 9/30/2008 $4,212 $1,567 2.7x New borrowing: Jan. '09 $1,125 Repayment: Aug. '09 ($225) Repurchase: 2009-2010 ($1,307) New borrowing: Sep. '10 $700 @ 9/30/2010 $4,509 $1,605 2.8x Repayment: May '11 ($1,442) @ 6/30/2011 $3,067
Slide 6: Business Unit Overview: Alaska, US Well Servicing, US Offshore
Business Unit Overview Alaska: Activity down with BP spending curtailment Results down 20% 09-10; 2011 down another 40% Longer-term opportunities and broader applications emerging Leading position in coiled-tubing drilling and AC technology US Well Servicing: Hours have steadily improved year-to-dat
Slide 7: Business Unit Overview: Canada and Other Segments
Business Unit Overview Canada: Increasingly positive versus last year's loss 2011 outlook continues to improve with oil activity & B.C. Shales We remain optimistic on our long-term position as market direction favors NBR fleet Other Segments: Innovative, technology-based products are currently being
Slide 8: US Lower Land
US Lower 48 Land As of 12/10/10, NDUSA has 186 rigs on revenue Virtually all PACE(r) rigs committed Full utilization of PACE(r) rigs has improved the market for SCR rigs Activity increasing in oil & liquids driven regions 2006: 85% Gas - 15% Oil & Liquids 2011E: 32% Gas - 68% Oil & Liquids Leading e
Slide 9: Premium Domestic Rig Fleet
Premium Domestic Rig Fleet U.S. Land Fleet 223 Electric 97 Mechanical A/C 31% MECH 30% SCR 39% NDUSA AC New Builds NDUSA AC New Builds In fleet @ 9/30/2010 100 To be deployed 17 Total 117
Slide 10: International Drilling
International Drilling Deeper trough & slower recovery than expected (mainly Mexico & Saudi) High confidence that 2010-2011 is the bottom 2011 higher rig count yields EBIT up $50 million 2011 jack-ups re-pricing yields EBIT down $50 million Largest impact is 1Q11 followed by 2Q11 Dry docking on jack
Slide 11: SWSI Acquisition
SWSI Acquisition Purchase price of approximately $900,000 Closed 34 days (September 10th) following announcement. 3Q 2010 results: $12 million EBIT in 20 days. Implies +/- $200 million EBIT 2011
Slide 12: SWSI Locations
SWSI Locations Service centers located in nearly all major U.S. basins Leadership in the Marcellus, with 127,000 hp operating in the region Significant presence in other unconventional plays including Haynesville, Bakken, Woodford and Barnett
Slide 13: Deal Strategic Rationale
Deal Strategic Rationale Broadens Our Portfolio Immediately Accretive Regardless of Synergies Enhances Our Growing Marcellus Position Complementary Technical Leadership Significant Synergy Opportunities Utilization of Nabors' Economies of Scale Consolidation of Other Assets with NBR Well Servicing,
Slide 14: Summary & Outlook
Summary & Outlook Macro Risk Still Present: Risk remains in North American Gas Markets Risk remains on International timing Nonetheless 2011 is Promising: International and U.S. Offshore - 2nd Half Turnaround Canada - growing with rig activity U.S. Land Well Servicing - growing with volume, pricing
Slide 15: SHOW ME!!! To Do List
SHOW ME!!! To Do List: Realize E&P values Demonstrate SWSI value Resume International growth Post sequential quarterly growth with clean numbers Enhanced multiple on increasing income Earn back premium to peers
Slide 16: Auxiliary Information
Auxiliary Information @)) nasons mousrmiEs 70.
Slide 17: Margins and Activities
Margins and Activities Margin = gross margin per rig per day for the period. Gross margin is computed by subtracting direct costs from operating revenues for the period. 3Q10 3Q10 2Q10 2Q10 3Q09 3Q09 Margin (1) Rig Yrs Margin (1) Rig Yrs Margin (1) Rig Yrs US Lower 48 8,629 182.2 7,788 172.3 9,673 1
Slide 18: Quarterly Adjusted Income Derived from Operating Activities
Quarterly Adjusted Income Derived from Operating Activities ($000's) 3Q10 2Q10 3Q09 US Lower 48 70,452 58,169 46,382 Nabors Well Services 9,049 3,231 342 US Pressure Pumping 11,987 ----- ----- US Offshore (1,090) 8,104 (163) Alaska 14,299 12,388 11,145 Canada 1,013 (9,497) (10,448) International 64,
Slide 19: Non-GAAP Financial Information
Non-GAAP Financial Information Within the preceding slides in this presentation, we present, both historically and on a forward-looking basis, our adjusted income derived from operating activities, which is a "non-GAAP" financial measure under Regulation G. The components of adjusted income derived
Slide 20: Non-GAAP Financial Information (continued)
Non-GAAP Financial Information (continued) The following table provides a reconciliation of adjusted income derived from operating activities for our reportable segments to income (loss) from continuing operations before income taxes for the three months ended September 30, 2010, June 30, 2010 and S
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