Npk International Inc. · NYSE:NPKI
Npk International — Newpark Resources — FY2019 Earnings Presentation
29 slides from Npk International's earnings presentation, Feb 27, 2020
Slide 1: Newpark Resources Presentation February 2020
NEWPARK RESOURCES PRESENTATION FEBRUARY 2020
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. All statements other than statements of historical facts are forward-looking statements. Words such as “will,” “may,” “could,” “w
Slide 3: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES 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 earnings before inte
Slide 4: Company Overview
COMPANY OVERVIEW Consolidated Revenues $1,000 $947 . Newpark’s value-proposition is driven by $900 $820 a focus on providing leading technology $800 $748 that reduces customer’s total operating $677 $700 costs, risk, and environmental impact. $600 Two operating segments: $500 $471 $400 Fluids System
Slide 5: Global Strength
GLOBAL STRENGTH 2019 - Revenue by Region U.S. Europe, Middle East, Rest of World Africa 7% 22% 71% 5
Slide 6: Fluids Systems - Overview
FLUIDS SYSTEMS - OVERVIEW Total Segment Revenues . Leveraging position as third largest global provider of Drilling & Completion Fluids*, $800 $716 expanding presence with more stable IOC $700 $616 $620 & NOC markets $600 $581 $500 IOC/NOC customer base reflects ~ 1/3 of $395 segment revenue, incl
Slide 7: Fluids Systems – Leading Technology
FLUIDS SYSTEMS – LEADING TECHNOLOGY Developing Total Fluids Solutions . Our focus on sustainability is a driving force behind breakthroughs in our Evolution® high performance water-based drilling fluid systems, which offer environmentally-sound solutions to the rigorous operational demands of today’
Slide 8: Fluids Systems – North America
FLUIDS SYSTEMS – NORTH AMERICA North American Revenues 600 . Swift actions being taken to $477 500 $427 transition North American operations $395 400 $352 Reducing operational footprint while 300 maintaining presence in all key $183 markets 200 Reducing overhead and support by Revenue ($ million
Slide 9: Fluids Systems – Market Expansion Underway
FLUIDS SYSTEMS – MARKET EXPANSION UNDERWAY Manufacturing . Market expansion capitalizes upon existing Fluids Systems infrastructure, expertise and market credibility Deepwater Gulf of Mexico Expansion and extension of Shell contract through 2020, sets the stage for year over year growth Project
Slide 10: Fluids Systems – International
FLUIDS SYSTEMS – INTERNATIONAL International Revenues . Strong IOC/NOC presence has been key $250 $239 $229 $220 to more stable revenue and profitability $212 $200 $193 through the industry cycle Revenue reduction in 2019 resulted $150 primarily from contract transitions in $100 Algeria and Brazil
Slide 11: Mats & Integrated Services - Overview
MATS & INTEGRATED SERVICES - OVERVIEW Total Segment Revenues $250 . Leading provider of engineered $231 worksite access solutions, where our $200 $200 systems are designed to: Reduce customer operating costs Reduce customer execution risk $150 $132 Improve environmental sustainability $100 $96
Slide 12: Mats - Competitive Advantages Across Industries
MATS - COMPETITIVE ADVANTAGES ACROSS INDUSTRIES Transportation, Enhanced Superior Install, and Environmental Scale and Quality Remediation Sustainability & Responsiveness Efficiency Safety 12
Slide 13: Mats – Core Market Overview
MATS – CORE MARKET OVERVIEW Exploration & Production Pipeline SIZE SIZE PENETRATION PENETRATION HISTORY HISTORY Transmission & Distribution Construction & Other SIZE SIZE PENETRATION PENETRATION HISTORY HISTORY 13
Slide 14: Financial Focus
FINANCIAL FOCUS Free Cash Flow (1) Cash Flow and Liquidity Profile . Generating consistent positive free cash $60 $55 $41 flow while funding strategic growth initiatives $40 $21 . Modest debt burden provides flexibility $20 $15 Near-Term Focus $Millions $0 -$20 . Ongoing efforts to improve Fluids re
Slide 15: Appendix
APPENDIX ol -EL NEWPARK
Slide 16: Consolidated Statements of Operations (Unaudited)
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) 16
Slide 17: Operating Segment Results (Unaudited)
OPERATING SEGMENT RESULTS (UNAUDITED) (1) Fluids Systems operating loss for the three months ended December 31, 2019 includes a total of $17.0 million of charges, consisting of an $11.4 million non-cash impairment of goodwill and a total of $5.6 million of charges associated with facility closures a
Slide 18: Consolidated Balance Sheets (Unaudited)
CONSOLIDATED BALANCE SHEETS (UNAUDITED) 18
Slide 19: Consolidated Statements of Cash Flows (Unaudited)
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) 19
Slide 20: Non-GAAP Financial Measures (Unaudited)
NON-GAAP FINANCIAL MEASURES (UNAUDITED) The following tables reconcile the Company’s net income (loss) or segment operating income (loss) calculated in accordance with GAAP to the non-GAAP financial measure of EBITDA: (1) 2019 net loss and EBITDA include a total of $23.2 million of charges, consisti
Slide 21: Non-GAAP Financial Measures (Unaudited)
NON-GAAP FINANCIAL MEASURES (UNAUDITED) (1) 2019 Fluids Systems operating income and EBITDA include $18.7 million of charges, consisting of an $11.4 million non-cash impairment of goodwill and a total of $7.3 million of charges associated with facility closures and related exit costs, inventory writ
Slide 22: Non-GAAP Financial Measures (Unaudited)
NON-GAAP FINANCIAL MEASURES (UNAUDITED) The following table reconciles the Company’s net cash provided by operating activities calculated in accordance with GAAP to the non-GAAP financial measure of the Company's free cash flow: 22
Slide 23: Non-GAAP Financial Measures (Unaudited)
NON-GAAP FINANCIAL MEASURES (UNAUDITED) 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: 23
Slide 24: Experienced Leadership
EXPERIENCED LEADERSHIP 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 David Paterson President Fluids Systems Matthew
Slide 25: Management Biographies
MANAGEMENT BIOGRAPHIES Paul L. Howes, President & CEO: Paul L. Howes joined Newpark’s Board of Directors and was appointed as the Chief Executive Officer in March 2006. In June 2006, Mr. Howes was also appointed as the President. Mr. Howes’ career has included experience in the defense industry, che
Slide 26: Management Biographies
MANAGEMENT BIOGRAPHIES 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 President, General Cou
Slide 27: Management Biographies
MANAGEMENT BIOGRAPHIES 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 Engineer, progressing
Slide 28: Board of Directors
BOARD OF DIRECTORS 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 interests of
Slide 29: Rated
4 st Rated Fluids, Chemicals {4 & Proppants OILFIELD PRODUCTS NEWPARK 4 st Rated in Deepwater Applications OILFIELD SERVICES Drilling Fluids pucTs Applications = al — =