Credit Suisse Energy Summit Vail, Colorado February 8, 2011
Market Dynamics We have taken a 20 year view of markets with the following expectations: Major growth in oil & gas will come from outside the US National Oil Companies will become increasingly prominent in supply decisions The…
Dresser-Rand Investment Highlights g g Well positioned to benefit from continuing energy infrastructure investment: Traditional T diti l oilil & gas upstream t and dddownstream t growth th opportunities t iti Emerging market…
Global Supplier of Energy Infrastructure Solutions Approximately 90% of sales for the twelve months ended 12/31/09 of 2.3 billion from oil and g gas infrastructure spending g Future g growth fueled by y markets outside of…
Energy Infrastructure Expansion
Upstream FPSO / LNG Floating Production, Storage & Offloading FPSO (FPSO) O Over 100 projects j t nextt 5 years Asia, West Africa and Latin America 200,000 of compression equipment per one million SCF of gas production Liquefied…
Midstream Pipelines & Storage Investment driven by increasing gas consumption, increase in unconventional gas (coal bed methane & shale) and aging / inadequate infrastructure Growth in Asia, China, India, US Acquisitions strengthen…
Downstream Refining / Petro-Chemical Major Market Drivers Environmental Compliance Capacity Expansion Energy Conservation Increased Demand Difficult Crudes Expect considerable activity in Latin America, the Middle East, India and…
Compressed Air Energy Storage (CAES) Concept: Compress air into cavern at night use energy Expand air during day produce energy McIntosh Alabama CAES Facility DRC Experience & Technology - Only operating installation in North…
Carbon Capture, Utilization, and Sequestration Large emerging market Over 100 projects per year by 2020 2 billion per year in compressor equipment needed Driven by pending carbon policy l i l ti legislation Compression 1/3 off…
Leveraging Product Platforms Across Energy Infrastructure Markets 100 % product technology overlap 12
Focus on Technology Leadership Separator / compressor differentiates DRC as only one in- in-class 14
Technology y Platform Build Out Integrated Compression/Subsea Supersonic Compression Steam Turbines (ICS) Game Changing g g Compression p High g Efficiency c e cy a at Lower o e Separator/Compressor Technology Cost…
Extensive Global Presence Headquarters Houston, Texas Houston Texas, USA Global Operations (12) Paris, France Olean, New York Le Havre, France Regional Centers Wellsville, New York Oberhausen, Germany Painted Post, New…
Infrastructure Initiatives Significant growth opportunity in emerging markets Brazil China India Korea Indonesia Kazakhstan Saudi Arabia Angola A l Sub Sahara Africa Can better serve these markets through localization…
Unique Business Model Characteristics
Unique Business Model Characteristics revenues tied to energy infrastructure build-out build out cyclical Flexible manufacturing model used to effectively meet demand swings enhances ability to maintain new unit margins revenues…
Increase Operating p g Income Two key financial objectives: 1) Increase new unit margins Keyy new unit initiatives: Operational excellence Supply chain management P Process innovation i ti Value selling Flexible manufacturing…
Low Capital Intensity NWC as a % of Sales Capex as a % of Sales 4.0% 2.0% 1.5% 2.0% 3.9% 3.6% 2.7% 1.0% 1 4% 1.4% 1 8% 1.8% 1 8% 1.8% 1 7% 1.7% 0.0% 1.3% 1.3% 1.4% -0.8% 0.5% 1.1% -1.5% -2 0% -2.0% 0 0% 0.0% 12 pt.…
Result - Significant Free Cash Flow ( in Millions) Flexible manufacturing + dependable aftermarket + low capital intensity = strong cash flow generation 22
Under-leveraged Balance Sheet Following F ll i 2004 LBO used d FCF to t pay down d debt d bt 23
Internal Uses of Cash 2011 through 2013 ( in Millions) Free Cash Flow expected to significantly exceed internal funding requirements 24
Business Results ( in millions, except EPS ) 25
Cumulative Total Shareholder Return Indexed returns based on 100 investment on August 5, 2005 (DRC IPO date) 26
Conclusion Strong end markets in Oil and Gas + Emerging Environmental opportunities + Dependable aftermarket Growth + Targeted strategic initiatives (Technology/Infrastructure) = 15% Revenue and 30% EPS CAGR through 2015 +…
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