Npk International Inc. · NYSE:NPKI
Npk International — Newpark Resources — Investor Presentation (September 2018)
33 slides from Npk International's investor presentation, Sep 25, 2018
Slide 1: Newpark Resources Presentation September 2018
N E W PA R K R E S O U R C E S P R E S E N TAT I O N S E P T E M B E R 2 0 1 8
Slide 2: Forward Looking Statements
F O R WA R D L O O K I N G S TAT E M E N T S This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. All statements that address expectations or projections about the future, including Newpark's strategy for grow
Slide 3: Non-GAAP Financial Measures
N O N - G A A P F I N A N C I A L M E A S U R E S This presentation includes references to financial measurements that are supplemental to the Company’s financial performance as calculated in accordance with generally accepted accounting principles (“GAAP”). These non-GAAP financial measures include
Slide 4: Company Overview
C O M PA N Y O V E R V I E W Consolidated Revenues $1,400 Balanced income contribution from two Full Year operating segments: $1,200 $1,118 First Half $1,042 $1,000 Fluids Systems 3rd largest global provider of Drilling and $800 $748 $677 Completions Fluids to Oil and Gas $600 $471 exploration** R
Slide 5: Global Strength
G L O B A L S T R E N G T H Revenue by Region – First Half 2018 U.S. Canada Latin America Eastern Hemisphere 25% 4% 7% 64% 5
Slide 6: Strengthened by Our Investments
S T R E N G T H E N E D B Y O U R I N V E S T M E N T S Infrastructure investments significantly enhance our competitiveness and support our market expansion and diversification initiatives Reflects our commitment to be the global leader in fluids and matting technology Fluids: Manufacturing Fac
Slide 7: Fluids Systems - Overview
F L U I D S S Y S T E M S - O V E R V I E W Total Segment Revenues $1,200 Full Year Largest independent Drilling $1,000 $965 $926 First Half and Completion Fluids provider $800 globally* $616 $600 $581 $395 $400 $357 $200 $287 Capitalizing on strong market Revenues ($ millions) ($ Revenues $0 po
Slide 8: Fluids Systems - Leading Technology
F L U I D S S Y S T E M S - L E A D I N G T E C H N O L O G Y Proven drilling fluid systems designed to enhance wellsite performance Evolution® high-performance, water-based technology for global applications Fusion™ brine fluid system creates a unique enhancement for shale basins Kronos™ de
Slide 9: Fluids Systems - North America
F L U I D S S Y S T E M S – N O R T H A M E R I C A North American Revenues $800 Hold #2 drilling fluids market share $687 $700 $654 Full Year position in U.S. land* $600 First Half $500 Significantly expanded share $395 $400 $352 through cycle $300 $183 Revenue ($ millions)($ Revenue $200 $23
Slide 10: Fluids Systems - International
F L U I D S S Y S T E M S – I N T E R N AT I O N A L $350 International Revenues International presence remains key to our Full Year strategy, leveraging IOC/NOC relationships $300 $278 $272 First Half globally $250 $229 $220 $212 More stable than NAM through the industry $200 cycles $150 Long
Slide 11: Mats & Integrated Services - Overview
M AT S & I N T E G R AT E D S E R V I C E S - O V E R V I E W Leading provider of engineered Total Segment Revenues $180 worksite and access solutions Full Year $160 $153 First Half Established core business in NAM $140 $132 $116 E&P market, where mats reduce $120 operator’s costs and improve $9
Slide 12: Mats - Competitive Advantages Across Industries
M AT S - C O M P E T I T I V E A D VA N TA G E S A C R O S S I N D U S T R I E S Superior Transportation, Install & Enhanced EH&S Scale & Quality Remediation Efficiency Attributes Responsiveness DO WE HAVE PHOTOS OF ACTUAL INSTALL? PHOTO FROM PG 3 OF BROCHURE? 12
Slide 13: Mats - Accelerating Market Diversification
M AT S – A C C E L E R AT I N G M A R K E T D I V E R S I F I C AT I O N Leveraging manufacturing capacity expansion to diversify market exposure. Primary markets targeted include: Utility Transmission Pipeline Utility Transmission & Distribution – Primary competitive offerings include wood mats a
Slide 14: Mats - Accelerating Product Development
M AT S – A C C E L E R AT I N G P R O D U C T D E V E L O P M E N T Leveraging R&D center to drive innovation, including next-generation matting systems, accessories and adaptations EPZ Grounding System – Patented system – Elevates worksite safety in utility transmission and distribution markets –
Slide 15: Financial Focus
F I N A N C I A L F O C U S Operating Cash Flow $200 Consistently generated positive operating $152 cash flow and maintained modest debt $150 $122 level throughout the cycle $100 $89 Short-Term Focus $ Millions $ $50 $38 $21 Pursue repatriation of available foreign $11 $0 cash following U.S. tax
Slide 16: Appendix
FT scwourx APPENDIX
Slide 17: Mats - Utility Transmission and Distribution
M AT S – U T I L I T Y T R A N S M I S S I O N A N D D I S T R I B U T I O N Market fully addressable by Newpark* Market partially addressable by Newpark* Site Access Market • Represents 5-10% of total industry spend * • Primary competitive offerings to composite mats include wood mats and gravel Ot
Slide 18: Mats - Utility Transmission and Distribution
M AT S – U T I L I T Y T R A N S M I S S I O N A N D D I S T R I B U T I O N Market % Spend Distribution by State 1 Infrastructure activity levels tend to track directionally with population distribution across the U.S. Targeted Customer Base • Utility Companies • EPC Companies • Construction Servic
Slide 19: Mats - Oil and Gas Pipeline
M AT S – O I L A N D G A S P I P E L I N E Market fully addressable by Newpark* Market partially addressable by Newpark* Site Access Market • Represents 5-10% of total industry spend * • Primary competitive offerings to composite mats include wood mats and gravel Other Key Demand Drivers (for Access
Slide 20: Mats - Oil and Gas Pipeline
M AT S – O I L A N D G A S P I P E L I N E % Spend Distribution by State 1 Infrastructure activity is concentrated in the regions close to oil and gas resources Targeted Customer Base • Pipeline Operators • EPC Firms • Integrity/Inspection Companies • Construction Service Companies Service company m
Slide 21: Consolidated Statements of Operations (Unaudited)
C O N S O L I D AT E D S TAT E M E N T S O F O P E R AT I O N S ( U N A U D I T E D ) Three Months Ended June 30, March 31, June 30, (In thousands, except per share data) 2018 2018 2017 Revenues $ 236,262 $ 227,293 $ 183,020 Cost of revenues 188,480 186,455 148,431 Selling, general and administrativ
Slide 22: Operating Segment Results (Unaudited)
O P E R AT I N G S E G M E N T R E S U LT S ( U N A U D I T E D ) Three Months Ended Six Months Ended June 30, March 31, June 30, June 30, June 30, (In thousands) 2018 2018 2017 2018 2017 Revenues Fluids systems $ 179,738 $ 177,379 $ 150,623 $ 357,117 $ 286,673 Mats and integrated services 56,524 49
Slide 23: Consolidated Balance Sheets (Unaudited)
C O N S O L I D AT E D B A L A N C E S H E E T S ( U N A U D I T E D ) (In thousands, except share data) June 30, 2018 December 31, 2017 ASSETS Cash and cash equivalents $ 71,722 $ 56,352 Receivables, net 252,154 265,866 Inventories 189,571 165,336 Prepaid expenses and other current assets 20,492 17
Slide 24: Consolidated Statements of Cash Flows (Unaudited)
C O N S O L I D AT E D S TAT E M E N T S O F C A S H F L O W S ( U N A U D I T E D ) Six Months Ended June 30, (In thousands) 2018 2017 Cash flows from operating activities: Net income $ 18,068 $ 649 Adjustments to reconcile net income to net cash provided by operations: Depreciation and amortizatio
Slide 25: Non-GAAP Financial Measures (Unaudited)
N O N - G A A P F I N A N C I A L M E A S U R E S ( U N A U D I T E D ) To help understand the Company’s financial performance, the Company has supplemented its financial results that it provides in accordance with generally accepted accounting principles (“GAAP”) with non-GAAP financial measures. S
Slide 26: Non-GAAP Financial Measures (Unaudited)
N O N - G A A P F I N A N C I A L M E A S U R E S ( U N A U D I T E D ) Six Months Ended Fluids Systems Twelve Months Ended December 31, June 30, (In thousands) 2013 2014 2015 2016 2017 2018 Operating income (loss) (GAAP) (2) $ 72,604 $ 95,600 $ (86,770) $ (43,631) $ 27,580 $ 23,804 Depreciation and
Slide 27: Non-GAAP Financial Measures (Unaudited)
N O N - G A A P F I N A N C I A L M E A S U R E S ( U N A U D I T E D ) The following table reconciles the Company’s ratio of total debt to capital calculated in accordance with GAAP to the non-GAAP financial measure of the Company’s ratio of net debt to capital: Consolidated December 31, June 30, (
Slide 28: Experienced Leadership
E X P E R I E N C E D L E A D E R S H I P • Paul Howes President & Chief Executive Officer • Gregg Piontek Senior Vice President & Chief Financial Officer • Chip Earle Vice President, General Counsel & Chief Administrative Officer, Chief Compliance Officer & Corporate Secretary • Phil Vollands Presi
Slide 29: Management Biographies
M A N A G E M E N T B I O G R A P H I E S Paul L. Howes, President & CEO: Paul L. Howes joined our Board of Directors and was appointed as our Chief Executive Officer in March 2006. In June 2006, Mr. Howes was also appointed as our President. Mr. Howes’ career has included experience in the defense
Slide 30: Management Biographies
M A N A G E M E N T B I O G R A P H I E S Edward “Chip” Earle, Vice President, General Counsel & Chief Administrative Officer, Chief Compliance Officer & Corporate Secretary: Chip joined Newpark in August 2018 as Vice President and Executive Advisor as part of a succession plan to become the Vice Pr
Slide 31: Management Biographies
M A N A G E M E N T B I O G R A P H I E S Matthew Lanigan, President Mats and Integrated Services: Matthew joined Newpark in April 2016, as President of Newpark Mats & Integrated Services. Matthew began his professional career at ExxonMobil in Australia working on rigs as a Drilling & Completions En
Slide 32: Board of Directors
B O A R D O F D I R E C T O R S Our Board members represent a desirable mix of diverse backgrounds, skills and experiences and we believe they all share the personal attributes of effective directors. They each hold themselves to the highest standards of integrity and are committed to the long-term
Slide 33: Dura-Base CCT-REX Mat Cleaning System
DURA-BASECCT-REX MAT CLEANING SYSTEM UR BIGGES
Newpark Resources — Investor Presentation (September 2018) on 6ix