Baker Hughes Company · NASDAQ:BKR
Baker Hughes — Baker Hughes, a GE company — 2018 Barclays CEO Energy-Power Conference
15 slides from Baker Hughes's conference presentation, Sep 6, 2018
Slide 1: 2018 Barclays CEO Energy-Power Conference
2018 Barclays CEO Energy-Power Conference Lorenzo Simonelli Chairman & CEO September 6, 2018 Confidential. Not to be copied, distributed, or reproduced without prior approval. © 2018 Baker Hughes, a GE company - All rights reserved
Slide 2: Caution Concerning Forward-Looking Statements
Caution Concerning Forward-Looking Statements This presentation (and oral statements made regarding the subjects of this presentation) may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of
Slide 3: One year in … CEO thoughts
One year in … CEO thoughts • Formed BHGE as the first fullstream company in the sector … differentiated investment opportunity • Opportunity to unlock significant value … synergies, running the company better • Broad, diversified portfolio … provides greater earnings stability • Clear priorities fro
Slide 4: Macro environment positive with multiple growth trajectories
Macro environment positive with multiple growth trajectories … speed of recovery varies by segment Global E&P spend ($B, CAPEX+OPEX) Global offshore spend ($B, E&P CAPEX) 1,500 350 300 +11% 1,250 CAGR +9% 250 ’19-’21 1,000 CAGR ’19-’21 200 750 150 500 100 2014 2015 2016 2017 2018 2019 2020 2021 2014
Slide 5: Delivering better outcomes is more critical than ever in this new environment
Delivering better outcomes is more critical than ever in this new environment BHGE focused on strategic steps to drive sustainable While breakevens have decreased >40% since 2013 … productivity in the O&G industry $100 Break-even price ($/bbl) MARKET LEADING INTEGRATED FULLSTREAM $75 PRODUCT SERVICE
Slide 6: BHGE … a differentiated investment opportunity
BHGE … a differentiated investment opportunity BHGE portfolio spans the value chain Unique differentiators 2017 revenue % 1 Balanced portfolio • Exposure across the value chain Other • Global presence … ~70% revenue outside NAM ~10% Downstream ~10% 2 Multiple growth trajectories • Leader in LNG and
Slide 7: Oilfield Services / Oilfield Equipment
Oilfield Services Oilfield Equipment $10.4B $2.7B • Leader in well construction & production • Strong execution & technology pipeline • Multi-basin NAM exposure • Leading subsea production & flexibles • Well positioned internationally & offshore • Collaborative partnerships & new models Growth Drive
Slide 8: Turbomachinery & Process Solutions / Digital Solutions
Turbomachinery & Digital Solutions Process Solutions $6.3B $2.5B • Technology leader in LNG & upstream production • Best in class sensing & measurement technology • Significant installed base … $13B service backlog • Differentiated software offerings • Proven track record in the most critical projec
Slide 9: Winning in the market … global commercial success
Winning in the market … global commercial success Johan Castberg Equinor NCS Siccar Point Buzzard Ph II Chrysaor OFS OFE NVIDIA Halfaya Zohr TPS Marjan Kinder Morgan ESP Tortue / DS Ahmeyim Qatar Petroleum Corpus Christi T3 Shwe Haradh & Fullstream W&T Offshore Hawiyah Nigeria LNG Twinza Gorgon Ph 2
Slide 10: Gaining share in OFS remains a top priority
Gaining share in OFS remains a top priority OFS revenue outgrowing rig count Focused on international growth OFS revenue indexed growth since 2Q’17 OFS international revenue indexed growth since 2Q’17 Rig count indexed growth since 2Q’17 International rig count indexed growth since 2Q’17 +14% +11% +
Slide 11: Driving efficiency and productivity … increased margin rates
Driving efficiency and productivity … increased margin rates Delivering on our plan in 2018 Clear plans in place for 2019 and beyond OFS Operating Margin 6.6% 1 Continue synergy execution 5.3% • $700M in 2018 … $1.6B in 2020 3.3% 3.7% 1.0% 2 Continue to expand OFS margins … close gap to peers 2Q'17
Slide 12: Investing in leading technology
Investing in leading technology R&D % of revenue … continuing to invest Building on a strong heritage 4% 2,800+ patents registered in 2017 3% $600M+ 2017 R&D spend* 2% 8,000+ engineers & scientists 1% 10+ global technology centers 0% 2016 1Q'17 2Q'17 3Q'17 4Q'17 1Q'18 2Q'18 Source: company filings *
Slide 13: Improving cash performance = shareholders
Improving cash performance Processes improving … more work to do Capital allocation progress Days Sales Outstanding* 103 Cash ~$0.8B 100 95 dividend ~$2.3B 89 86 = shareholders returned to since Share ~$1.5B deal close repurchases Inventory Turns* Focus remains unchanged 4.6 4.5 4.4 • ~90% FCF conve
Slide 14: Summary
Summary • One year in … significant progress • Macro environment encouraging • Phase 1 complete … foundation of BHGE built • 4 focus areas for the next year … synergies, growth, continue optimizing internal processes, GE separation • Company priorities unchanged … gain share, grow margins, generate
Slide 15: BAKER (46)
BAKER (46) UGHES a GE company
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