Klx Energy Services Holdings, Inc. · NASDAQ:KLXE
Klx Energy Services — Barclays CEO Energy-Power Conference 2022
26 slides from Klx Energy Services's conference presentation, Sep 6, 2022
Slide 1: Barclays CEO Energy-Power Conference September 2022
1 Barclays CEO Energy-Power Conference September 2022
Slide 2: Disclaimer & Forward-looking Statements
2 Disclaimer & Forward-looking Statements Cautionary Statement on Forward-looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. Such forward- looking statements involv
Slide 3: Company Overview
3 Company Overview
Slide 4: Cycle-tested Executive Team with Deep Industry Experience
4 Cycle-tested Executive Team with Deep Industry Experience Management team successfully led merger integration Chris Baker President & Chief Executive Officer Keefer Lehner EVP, Chief Financial Officer Max Bouthillette EVP, General Counsel and CCO Previously QES’s Executive VP, General Counsel an
Slide 5: A Transformed KLXE
5 A Transformed KLXE Post-merger, KLXE transformed into industry leader People Performance Asset Integrity Safety Customer Focus Profitability Veteran operators throughout the organization Deep technical expertise Transparent alignment of incentives Significant operating leverage Return on
Slide 6: KLX Energy Services (KLXE) Overview
6 KLX Energy Services (KLXE) Overview Company Overview Areas of Operation Diversified Product Offering1 Diversified Business Model • Leading U.S. onshore provider of value-added, mission critical services focused on the entire well life-cycle for the most technically demanding wells across the major
Slide 7: KLXE / QES Merger Integration Success
7 KLXE / QES Merger Integration Success Strategic Fit Premier provider of drilling, completion, production and intervention solutions with a returns driven strategy Minimal customer overlap with significant cross-sell potential Positioned to participate in further industry consolidation People
Slide 8: Diversified and Complementary Product Service Offering
8 Diversified and Complementary Product Service Offering PSL1 Q2 2022 Rev. Contribution Rockies Southwest Northeast/ Mid Con Select Products & Services Directional Drilling 22% MWD, proprietary K-Series mud motor, directional electronics and other modules Accommodations 6% Living accommoda
Slide 9: Significant Operating Leverage Tied To Market Recovery
9 ($20) ($10) $0 $10 $20 $30 $40 $50 - 200 400 600 800 1,000 1,200 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Quarterly average rig count (US Land) KLXE Adj EBITDA Significant Operating Leverage Tied To Market Recovery US Rig Count
Slide 10: Many Top Operators Choose KLXE
10 Many Top Operators Choose KLXE Served over 740 unique customers in 2021 with no customer accounting for more than 10% of 2021 revenue Diverse customer base – Top 10 customers accounted for only 29% of 2021 Revenue (down from 33% in 2020) Significant leverage to the most active operators in
Slide 11: Go-Forward Strategy
11 Go-Forward Strategy Cost Controls Continue to manage through supply chain constraints and pass costs onto customers Retain personnel and maintain equipment quality while continuing to proactively manage the cost structure to drive incremental margins Continue to proactively manage working c
Slide 12: Industry Outlook
12 Industry Outlook
Slide 13: Improving Macro Backdrop
13 Improving Macro Backdrop Rig counts historically tracked crude prices, but the correlation has decoupled since April 2020 Source: Baker Hughes, FactSet, Wall Street Research Note: Market data as of 8/5/2022 1. Henry Hub is not to scale and is in $ / MMcf 1,761 1,862 978 509 876 1,032 943 433 478
Slide 14: U.S. E&P Cash Cycle Since 2010
14 $102 $125 $117 $141 $169 $103 $101 $126 $174 $154 $93 $244 $96 $121 $164 $171 $201 $137 $86 $119 $152 $140 $78 $84 $6 $4 ($46) ($30) ($32) ($35) $15 $6 $21 $13 $14 $159 ($100) ($50) $0 $50 $100 $150 $200 $250 $300 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 $ in b illi on s U.S. E
Slide 15: Supply / Demand Dynamics Favor U.S. OFS Market
15 Supply / Demand Dynamics Favor U.S. OFS Market Geopolitics Upstream Investment Pricing and Margins Oilfield service companies expected to gain significant leverage in current favorable commodity price environment driven partly due to tightness in the labor market Historical margin inequality
Slide 16: Financial Performance
16 Financial Performance
Slide 17: Improving Profitability
17 • Rapidly improving financial results with annualized Q2 Revenue and Adj EBITDA of $738MM and $70MM, respectively Improving Profitability Source: Company disclosure Note: Results in Q2 2021 and prior are reported using a January 31st fiscal year end; results in Q3 and Q4 2021 are reported using a
Slide 18: Balance Sheet & Capitalization
18 • Ended Q2 with cash and total debt balance of $32MM and $295MM, respectively • Q2 Annualized net leverage ratio reduced to ~3.8x and expect further improvement in our credit metrics based on our Q3 guidance • Ended Q2 with available liquidity of $57MM, which was up $2MM or 4% from Q1 levels • Ba
Slide 19: Appendix
19 Appendix
Slide 20: Reconciliation of Consolidated Net Loss to Adjusted EBITDA
20 Reconciliation of Consolidated Net Loss to Adjusted EBITDA (loss) (dollar amounts in millions) Source: Company disclosure Adj EBITDA Reconciliation
Slide 21: Rocky Mountains Segment Adj EBITDA Reconciliation
21 Reconciliation of Segment Operating Income (loss) to Adjusted EBITDA (loss) (dollar amounts in millions) Rocky Mountains Segment Adj EBITDA Reconciliation Source: Company disclosure
Slide 22: Southwest Segment Adj EBITDA Reconciliation
22 Reconciliation of Segment Operating Income (loss) to Adjusted EBITDA (loss) Source: Company disclosure (dollar amounts in millions) Southwest Segment Adj EBITDA Reconciliation
Slide 23: Northeast/Mid-Con Segment Adj EBITDA Reconciliation
23 Reconciliation of Segment Operating Income (loss) to Adjusted EBITDA (loss) Source: Company disclosure (dollar amounts in millions) Northeast/Mid-Con Segment Adj EBITDA Reconciliation
Slide 24: Segment Adjusted EBITDA Margin Reconciliation
24 Segment Adjusted EBITDA Margin Reconciliation Source: Company disclosure Segment Adj EBITDA Margin Reconciliation (dollar amounts in millions)
Slide 25: SG&A Margin Reconciliation
25 SG&A Margin Reconciliation Source: Company disclosure SG&A Margin Reconciliation (dollar amounts in millions)
Slide 26: Annualized Adjusted EBITDA (loss) Reconciliation
26 Annualized Adjusted EBITDA (loss) Reconciliation Source: Company disclosure Annualized Quarterly Adj EBITDA (loss) Reconciliation (dollar amounts in millions)
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