U.S. Silica William Blair & Company 2015 Growth Stock Conference June 9, 2015
THE U.S. SILICA STORY Industry Leader. Capitalizing on Market Dynamics. Adj. EBITDA Competitive Business growth Balance Sheet advantages model 2009-2014 38% Strong Resilient Best CAGR 3
AT A GLANCE U.S. Silica Strength in Numbers Frac sand provider in world Top 3 Market positions in ISP 1 or 2 Operating facilities 17 Tons of reserves 363M Annual production in 2014 (tons) 10.9M Earnings from non-energy,…
THE U.S. SILICA STORY Industry Leader. Capitalizing on Market Dynamics. GOALS: 1 Differentiated business model 2015-2016 Resilient performance 2 Capitalizing on market dynamics 2020 Increase scale Substantial EBITDA Growth 3…
A Differentiated Business Model 1 Unmatched scale and resources 2 Advantaged distribution Strong, sustainable competitive advantages 3 Attractive customer mix 4 Strong financial position 7
1. Unmatched Scale and Resources C A N A D A 17 operating facilities Low cost production 35 transload terminals Well positioned in best basins Operating Facilities Oil & Gas ISP Planned Transload Terminals 8
2. Advantaged, Highly Flexible Distribution Moving Large Volumes Leverages our Highly Flexible of Proppant Supply Chain Example: Railcars and trucks needed to complete one well 430 Ability to redirect trains mid-trip Extensive…
3. Attractive Mix of Customers and Markets Long-term contracts: provide leverage in current market conditions Oil & Gas efficiency gains in production and supply chain planning Proppants Top five customers 50 year relationships…
4. Strong Financial Position 200 Unlevered balance sheet 46.9M available 150 Cash Flow from Ops. under revolver Total liquidity of 375M 100 as of March 31, 2015 Expect to be operating cash 50 Capex flow positive in 2015 0…
THE U.S. SILICA STORY Industry Leader. Capitalizing on Market Dynamics. GOALS: 1 Differentiated business model 2015-2016 Resilient performance 2 Capitalizing on market dynamics 2020 Increase scale Substantial EBITDA Growth 3…
Responding Aggressively to Declining Demand Market Demand Down 25-30% in 2015 Average rig More sand count per well down 45% up15-20% 2014 2015E 13
Leveraging Our Speed, Scale & Strength SPEED SCALE STRENGTH Working with our supply chain partners to take Leveraging barge Strong balance costs out opportunity sheet Deferring rail car Multiple mines on Talented & capable…
THE U.S. SILICA STORY Industry Leader. Capitalizing on Market Dynamics. GOALS: 1 Differentiated business model 2015-2016 Resilient performance 2 Capitalizing on market dynamics 2020 Increase scale Substantial EBITDA Growth 3…
Key Initiatives to Drive Success 4 Consolidator accretive 3 Enhance acquisitions Industrial & Specialty performance 2 Leverage logistics to gain share in market 1 Effectively manage downturn 16
INITIATIVE 1 Effectively Manage the Downturn Capture share Partner with the right customers Laser focus on cost Focus Increase fixed cost leverage Disciplined capital spending Help drive industry consolidation Utilize our…
INITIATIVE 2 Leverage Distribution Network Facilities in the right places, with the right products, at the best price Gain market share Emphasize high-velocity transloads Get even closer to the wellhead Improve the customer…
INITIATIVE 3 Enhance Industrial & Specialty Performance Solid, stable cash flow business Investing in Innovation Introducing higher-margin, value 37 added specialty products to grow EBITDA Optimizing product mix On track for…
INITIATIVE 4 Grow in a Fragmented Industry Poised for Consolidation Customers are consolidating Reducing suppliers Scale matters 40 Top 10: smaller Strong financial suppliers 65% position Source: PropTester, Inc. and…
2015 Outlook Expect 2015 to be challenging Volumes and pricing under pressure Lower fixed cost leverage ISP markets still strong and contribution margin growing Continuing to make strategic investments Numerous opportunities…
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