Mind Technology, Inc. · NASDAQ:MIND
Mind Technology — Mitcham Industries — IPO Roadshow (May 2016)
27 slides from Mind Technology's IPO roadshow presentation, May 18, 2016
Slide 1: Mitcham Industries, Inc. Cumulative Preferred Roadshow Presentation
THE EXPLORATION EQUIPMENT SUPPLIERTM Mitcham Industries, Inc. Cumulative Preferred Roadshow Presentation Issuer Free Writing Prospectus Filed Pursuant to Rule 433 Registration Statement No. 333-208177 May 18, 2016
Slide 2: Statement about Free Writing Prospectus
Statement about Free Writing Prospectus This free writing prospectus relates to the proposed public offering of Series A Preferred Stock of Mitcham Industries, Inc. (the “Company”), which is being registered on a Registration Statement on Form S-1 (No. 333-208177) (the “Registration Statement”). Thi
Slide 3: Disclosure Slide
Disclosure Slide This presentation has been prepared by Mitcham Industries, Inc. (“the “Company”) solely for informational purposes based on its own information, as well as information from public sources. This presentation has been prepared to assist interested parties in making their own evaluatio
Slide 4: Transaction Overview
Transaction Overview
Slide 5: Company and Transaction Overview
Company and Transaction Overview Financial Summary FY 2016 Adjusted EBITDA: $13.7 million* Estimated Cash Flow Coverage ratio: 8.8x** Net Debt (1/31/2016): $17.0 million $30 million senior facility Libor + 3.50% Current book value of Leasing Equipment: $68 million Estimated Asset Coverage Ratio: 5.3
Slide 6: Proposed Terms: Series A Preferred Stock Offering
Proposed Terms: Series A Preferred Stock Offering See below proposed terms of the offering: Issuer: Mitcham Industries, Inc. Securities Offered: Series A Cumulative Preferred Stock Proposed Listing: MINDP (Nasdaq) Offering Type: New Issue Base Deal Size: $15 million Over-Allotment Option: 15% Divide
Slide 7: Mitcham Industries Corporate Overview
Mitcham Industries Corporate Overview
Slide 8: Company Overview
Company Overview Founded in 1987 Nasdaq: MIND Fiscal Year-End January 31 Two business segments Designer and manufacturer of marine seismic, oceanographic and hydrographic equipment Lessor of advanced seismic and hydrographic equipment Nine worldwide locations provide global footprint Recent diversif
Slide 9: Management
Management Robert P. Capps Co-CEO, CFO Over 35 years financial experience, 10 years with Mitcham Guy Malden Co-CEO, Marine Operations Over 35 years in marine seismic industry, 13 years with Mitcham Significant bench strength Over 200 employees in 9 offices worldwide Sales Operations Engineering Prod
Slide 10: Mitcham Advantages
Mitcham Advantages Broad geographic footprint Financial strength and flexibility Capabilities in marine market Engineering and support resources Manufacturing capabilities Domain knowledge Seismic Hydrographic/Oceanographic Large lease pool of state-of-the-art seismic recording equipment Not tied to
Slide 11: Adjusted EBITDA
Adjusted EBITDA* FYE January 31 See below historical adjusted EBITDA, since FY 2000. As illustrated below, despite the cyclicality of the business Mitcham has had positive adjusted EBITDA annually since 2000 and has only had one quarter of negative adjusted EBITDA in that time period. *Adjusted EBIT
Slide 12: Total Revenue
Total Revenue FYE January 31 See below historical revenue for Mitcham Industries since FY 2000. Over 90% of Mitcham’s historical revenues have come from outside the United States. Source: Company Filings
Slide 13: Solid Financial Liquidity
Solid Financial Liquidity January 31, 2016 (in thousands) Cash and short-term investments $3,769 Accounts receivable, net $19,775 Working capital $28,240 Seismic equipment lease pool, net $68,000 Outstanding credit facilities (short and long term) $20,484 Tangible net book value per share $7.48 Debt
Slide 14: Extensive Global Footprint
Extensive Global Footprint Canada Land Rental United States Corporate Headquarters Land Rental Marine Rental Oceanographic/hydrographic equipment manufacturing U.K Seamap Engineering Russia Land Rental Singapore Seamap Manufacturing Marine Rental Australia Land rental Oceanographic / hydrographic eq
Slide 15: Longstanding Customer Relationships
Longstanding Customer Relationships International seismic contractors Indigenous seismic contractors State-owned oil and gas companies International service companies
Slide 16: Global Seismic Market
Global Seismic Market Seismic industry is experiencing a dramatic decline in activity due to slow-down in exploration activity by oil and gas companies Excess capacity currently exists in the market, marine and land Most industry participants are reporting very weak financial results Some may not su
Slide 17: Leading Manufacturer of Specialized Marine Equipment
Leading Manufacturer of Specialized Marine Equipment Seamap designs, manufactures and sells a variety of industry-leading products for marine market. Strong market position for energy source controllers with over 100 installations BuoyLink RGPS systems are now the primary choice for streamer and sou
Slide 18: Provider of Hydrographic and Oceanographic Equipment
Provider of Hydrographic and Oceanographic Equipment Australian subsidiary, SAP, acts as manufacturer representative for various products. Provides integration, training and support services. Equipment used in numerous marine applications, most non-seismic related Hydrographic surveys Coastline and
Slide 19: Recent Acquisition
Recent Acquisition
Slide 20: Acquisition of Klein Associates
Acquisition of Klein Associates Klein is recognized as the leading provider of side-scan sonar products to the hydrographic/oceanographic industry. Purchase price - $10.0 million cash. Over past two years, Mitcham has been the largest distributor of Klein products through its Australian subsidiary.
Slide 21: Seismic Leasing Business
Seismic Leasing Business
Slide 22: World's Largest Equipment Lease Pool
World’s Largest Equipment Lease Pool Extensive state-of-the-art equipment inventory deployed worldwide addresses market needs quickly and efficiently. High Quality Equipment with current net orderly liquidation appraisal value of $132 million (current carried book value of $68 million) Land Over 290
Slide 23: The Leasing Advantage
The Leasing Advantage Why customers lease versus buy? Better utilization of capital Lowers prospect of idle equipment between jobs Reduces capital expenditures for new seismic equipment Allows use of capital for equipment that is not available for lease or rent Allows customers to supplement existin
Slide 24: The Mitcham Leasing Model
The Mitcham Leasing Model Unique business within seismic industry Leasing seismic equipment provides a cost effective alternative for seismic contractors Volume leverage in the business model at minimal incremental costs Equipment “agnostic” We support, not create, markets Customers dictate make-up
Slide 25: Appendix - EBITDA Reconciliation
Appendix- EBITDA Reconciliation
Slide 26: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation Non-GAAP Financial Measures: EBITDA is defined as net income before (a) interest income and interest expense, (b) provision for (or benefit from) income taxes and (c) depreciation and amortization. Adjusted EBITDA excludes non-cash foreign exchange gains and losses, no
Slide 27: Cash Flow & Asset Coverage Ratio Calculation
Cash Flow & Asset Coverage Ratio Calculation Balace Sheet Data as of 1/31/2016 MIND Book Value Total Assets 134,759,000 $ Intangible Assets (10,466,000) Goodwill (4,155,000) Book Value of Tangible Assets 120,138,000 Current Liabilities 12,456,000 $ Short-Term Debt (3,218,000) Current Liabilities - S