Act Energy Technologies Ltd. · TSX:ACX
Act Energy Technologies — Cathedral Energy Services — Investor Presentation (June 2023)
14 slides from Act Energy Technologies's investor presentation, Jun 1, 2023
Slide 1: Corporate Presentation June 2023
C O R P O R AT E P R E S E N TAT I O N JUNE 2023 Confidentiality: This presentation is strictly confidential, is intended only for the specified recipient to provide information regarding the business affairs of Cathedral, and shall not be reproduced, published or distributed under any circumstances
Slide 2: Who We Are (CET-TSX)
WHO WE ARE (CET-TSX) ONE OF THE LARGEST NORTH AMERICAN PURE-PLAY DIRECTIONAL DRILLING COMPANIES Market Share ~25% • Significant Canadian and US footprint ~7% • Fully-integrated supplier of a proprietary fleet of premium downhole directional technology 2023E REVENUE MIX (%) • Comprehensive suite of s
Slide 3: What's Changed With CET?
WHAT’S CHANGED WITH CET? 1 New, Experienced Management Team focused on Size & Scale 2 Management and Board own 17.5%1. Plus two strategic shareholders who are supportive of our plan 3 Established as one of the largest independent directional drilling contractors in North America through Seven Acquis
Slide 4: Cathedral's Core Technology
CATHEDRAL’S CORE | TECHNOLOGY High-Performance Measurement Rotary Steerable Mud Motors While Drilling (MWD) (RSS) • Flexibility with multiple mud • Best-in-Breed reliability & performance • RSS applications continue to grow motor product lines • Build-cost advantage vs “Off the Shelf” • Established
Slide 5: Cathedral's Opportunities
CATHEDRAL’S OPPORTUNITIES T WO K E Y FO C U S A R EA S E N E R G Y T E C H N O L O G Y R E N TA L FULL-SERVICE DIRECTIONAL • Expand current technology • ~7% U.S. Market Share with room product offering to expand through consolidation to > 10% • Enables evolving “a la carte” direct-to- customer marke
Slide 6: Consolidation Strategy
Incremental market share gains in complementary markets Add experienced management teams CONSOLIDATION aligned with equity STRATEGY Scarcity of Buyers Cathedral is ideally positioned to be a key consolidator of directional Targeting accretive transactions on drilling services a per share basis Targe
Slide 7: Track Record of Consolidation
TRACK RECORD OF CONSOLIDATION SUCCESSFULLY COMPLETED SEVEN ACQUISITIONS SINCE MID-2021 LEXA Technologies strategic technology Precision Drilling’s directional drilling business acquisition improves MWD and positions expands market share and creates strategic company to build RSS fleet marketing alli
Slide 8: Size and Scale Matter
SIZE AND SCALE MATTER • The market is clearly rewarding larger OFS companies with higher valuations • Enterprise Value of $1.0bn is a key threshold for multiple expansion in OFS • Large Caps in OFS can aim for a 3.0-5.0x EV/EBITDA multiple Source: Stifel FirstEnergy CATHEDRALENERGYSERVICES.COM JUNE
Slide 9: Two Technology Alliances With Leading Land Drillers
TWO TECHNOLOGY ALLIANCES WITH • Cathedral has signed Strategic LEADING LAND DRILLERS Marketing and Technology Alliances with two of the world’s largest land drillers • Enhance customer value by improving performance and consistency through automation or auto-assisted drilling services • Collaborate
Slide 10: Consolidation Torque
HIGH GROWTH RATE POTENTIAL IN ALL KEY METRICS CONSOLIDATION TORQUE Revenue ($MM) Adjusted EBITDAS ($MM) 141 546 579 111 542 114 515 96 Cathedral’s consolidation 41 63 298 5 68 (3) strategy has achieved 2020A 2021A 2022A 2023E* 2024E* 2020A 2021A 2022A 2023E* 2024E* strong results with Street Low Str
Slide 11: Balance Sheet - Conservative Approach Through the Cycle
BALANCE SHEET - • Size and scale has substantially improved CONSERVATIVE APPROACH Free Cash Flow profile THROUGH THE CYCLE • On track for significant debt reduction this year NET DEBT TO 2023 ADJUSTED EBITDAS RATIO 1.2 1.0 • Any potential Acquisitions will require ≤ 1.0x 0.8 Net Debt/Adjusted EBITDA
Slide 12: Summary: A Leading North American Directional Driller
SUMMARY: A LEADING NORTH AMERICAN DIRECTIONAL DRILLER Lower capital intensity business Positive net earnings faster than other model translates to higher free industry verticals with market share, EBITDA cash flow and corresponding depreciation profile 1 New management team focused on value-added gr
Slide 13: Forward Looking Statements
Forward-Looking Information This presentation contains statements and information that may constitute "forward-looking information" within the meaning of applicable securities legislation, including statements identified by the use of words such as "will", "expects", "positions", "believe", "potenti
Slide 14: Forward Looking Statements & Disclaimers
Forward-Looking Information Outside Research Definitions (continued) “Net Debt to EBITDA” as defined by ATB Capital Markets is Net debt divided by current-year, 12-month EBITDAS (adjusted by Cathedral to current year for comparability) “Net Debt to EBITDA” as defined by Acumen Capital is Net debt di
Cathedral Energy Services — Investor Presentation (June 2023) on 6ix