CANADA CAPITAL ONE SOUTHCOAST, INC. 7TH ANNUAL ENERGY CONFERENCE New Orleans, LA December 3-6, 2012
FORWARD LOOKING STATEMENTS This document contains statements that constitute forward-looking statements within the meaning of applicable securities legislation. These forward-looking statements include, among others, the Companys…
OVERVIEW OF TRICAN Large, world-wide, full service 2012 REVENUE BY GEOGRAPHY pressure pumping company as of September 30, 2012 International 12% International Russia (majority) Kazakhstan Algeria 36% 52% USA Canada…
TRICAN STRENGTHS
TRICAN STRENGTHS 1,158,150 HP current fracturing Fracturing HP Growth capacity 1,400,000 1,200,000 At end of 2012: 1,000,000 1,197,000 HP fracturing 800,000 capacity 600,000 400,000 92 Cement & 34 Acid Units…
TRICAN STRENGTHS Our people are our strength 5,776 skilled employees worldwide Hiring and training people are key to growth Total hours of training for new hire orientation and upgrading over the last eight years:…
STRENGTHS FULL SERVICES Service Line % of 2012 Revenue (at Sept. 30, 2012) Fracturing 77% Cementing 11% Nitrogen 5% Coiled Tubing 4% Acidizing & Specialty 2% Chemicals Industrial & Pipeline 0.5% Services Geological Services…
COMPETITIVE ADVANTAGES Customer-focused provider of technical solutions Separate ourselves with technology Named one of Canadas top 100 Corporate R&D spenders in 2011 (by Research Infosource Inc.) Product development is a…
AREAS OF OPERATION Canada United States Russia Kazakhstan Algeria Australia 9
CANADA
GEOGRAPHIC COVERAGE Horn River FORT NELSON HIGH LEVEL Shale British Columbia Alberta Saskatchewan Manitoba Montney FORT ST. JOHN Shale RED EARTH Duvernay GRANDE PRAIRIE Shale WHITECOURT HINTON NISKU LLOYDMINSTER DRAYTON…
CANADA Trican Frac Stages Per Well Horizontal Wells Only 18 16 Increase in fracturing jobs / 14 well Average Stages Per Well 12 Majority of activity is on oil or 10 liquids-rich gas plays 8 6 Almost all fracturing…
CANADA - OUTLOOK Rig count down in fourth quarter Expect reduced activity in Q4 Activity levels anticipated to bounce back in Q1 2013 New play developments in the Duvernay, Nordegg, Slave Point, Beaverhill Lake and Muskwa…
CANADA - PRICING Expect price softening in Canadian Pricing Levels Canada in the second half of 45% 2012 as new equipment enters 40% the market 35% 30% 25% Margins expected to drop as 20% 15% competition increases…
CANADA EQUIPMENT - 2012 Canadian HP Growth Expected fleet by end of 2012 450,000 400,000 414,000 fracturing HP 350,000 56 Cementing units 300,000 250,000 38 N2 Pumpers 200,000 150,000 19 Acid Units 100,000 20 Coil…
USA
GEOGRAPHIC COVERAGE - FRACTURING WOODWARD Woodford Shale Fayetteville Shale Barnett Shale: 1 crew Oklahoma City SEARCY SHAWNEE Haynesville OKLAHOMA Shale: 1 crew Little Rock ARKANSAS Eagle Ford 2 crews DENTON Shale:…
GEOGRAPHIC COVERAGE - FRACTURING Marcellus Shale: 2 crews Bakken Shale: 1 crew MINOT Bakken Current Shale USA HP: 670,000 NORTH DAKOTA MILL HALL Marcellus PENNSYLVANIA Shale 18
USA EQUIPMENT - 2012 US HP Growth 700,000 600,000 500,000 400,000 Expected fleet by end of 2012 300,000 200,000 670,000 fracturing HP 100,000 0 2007 2008 2009 2010 2011 2012* 25 Cement units USA Cement & Coil…
USA PRICING AND MARGINS Pricing off 30-35% in dry gas areas US Pricing Levels Pricing is down in oil and 90.0% liquids areas 80.0% 70.0% 60.0% Margins down due to 50.0% increases in guar, freight, 40.0% R&M, and…
USA OUTLOOK - 2012 Guar prices have declined and will positively impact Q4 and 2013 margins Will continue to focus on cost cutting initiatives 1 new crew started operations in the Bakken in Q3 2 new crews will remain idle…
RUSSIA
RUSSIA AND THE FSU Started operations in 2000 Grown to become the largest fracturing company Primarily work on oil wells All work is on 1 or 3 year contracts Services: Fracturing 79% Deep Coiled Tubing 10% Cementing 8%…
RUSSIA AND THE FSU Barents Sea Arctic Shelf Kara (Barents, Pechora, Sea Kara Seas) Timan- Pechora Eastern Siberia Western Siberia Sakhalin Volga-Urals Shelf Northern Caucasus Traditional regions for oil…
2012 EQUIPMENT CAPACITY: RUSSIA & KAZAKHSTAN 16 14 12 10 8 6 4 2 0 Coiled Tubing Nitrogen Cement Frac Crews 109,300 Fracturing HP * Expected equipment capacity at the end of the year based upon approved…
RUSSIA - OUTLOOK Revenue below forecast Customers are behind schedule Increased use of horizontal fracturing Successful implementation of Burst Port (BPS) technology 26
INTERNATIONAL
INTERNATIONAL Algeria Improving market conditions Obtained additional contracts in 2012 on existing equipment Australia Activity increasing throughout 2012 Kazakhstan Very busy Middle East Tendering work for 2013…
INNOVATION
INNOVATION Trican focuses on separating itself with technology SRVmaxTM Integrated technical solution Combines geology, microseismic, frac modelling and reservoir modelling Want to assist customer in choosing horizontal…
INNOVATION BPS - Burst Port System Patented tool technology for multi-zone fracturing Replaces perforating Lowers cost and saves time Very successful in Canada Successful introduction to Russia in 2012 EcoClean Fluids…
INNOVATION Water Management Developed new dry-add friction reducers which allows for less fresh water use Introduced water recycling services in Q2 Polar Frac Developed ultra low temperature fracturing fluid for Eastern…
FINANCIAL OVERVIEW
FINANCIAL RESULTS Nine months ended Sept. 30 Comparison* 2012 2011 % Change Revenue 1,727,535 1,615,433 7% Operating Income 204,945 417,229 (51%) Net Income 61,415 223,786 (73%) Earnings per share: - Basic 0.42 1.54 (73%) -…
FINANCING Long-term notes payable US 375 million o US 95 million of this balance is hedged CA 60 million CA 500 million revolving credit facility US 20 million Russian revolving credit facility 35
PROJECTED 2012 CAPITAL BUDGET Remaining capital expenditures of 150 million to 200 million Have reduced initial capital budget by over 300 million over the last 9 months Expect capital expenditures of 70 million to 90…
BALANCE SHEET STRENGTH As at Sept. 30* Cash & Available 309 Million Debt Long Term Debt to 30% Capitalization Long Term Debt to 1.9 times Trailing Cash Flow Substantial room on Yes our debt covenants * The above data does…
BALANCED GROWTH Dividend increased from 10 to 30 per year Approximately 2.5% yield Implemented share buyback program in March 2012 38
INVESTMENT ADVANTAGES Growth stock ROCE Strong management team 45.00% 40.00% 35.00% Capital disciplined strong 30.00% balance sheet 25.00% 20.00% Future growth opportunities 15.00% Decline in worldwide reservoir…
SUMMARY Number of Outstanding Shares (as of Oct. 31, 2012): 146.5 million 146.8 million (diluted, monthly, weighted avg.) (approx., estimated) Average Daily Volume (30 day period): 946,887 (mo. ended Oct. 31, 2012)…
CANADA CAPITAL ONE SOUTHCOAST, INC. 7TH ANNUAL ENERGY CONFERENCE New Orleans, LA December 3-6, 2012
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