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Johnson Rice Energy Conference – Exterran Holdings, Inc.

Exterran Holdings, Inc. · Sep 29, 2015 · 45 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

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  1. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 1
    Exterran Holdings Johnson Rice Energy Conference September 29, 2015 Brad Childers Jon Biro President and Chief Executive Officer Senior Vice President and Chief Financial Officer 0 Exterran Exterran Holdings. All rights…
  2. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 2
    BUSINESS OUTLOOK In the second quarter 2015, we achieved solid operating performance across our businesses Expected impact of lower commodity prices on production-oriented businesses within the oil and gas industry should be less than…
  3. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 3
    NATURAL GAS MARKET PERSPECTIVES Forecasted International Supply Forecasted U.S. Supply 600 110 100 500 90 80 (Billion Cubic Feet Per Day) 400 70 Billion Cubic Feet per Day 60 300 50 40 200 30 20 100 10 0…
  4. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 4
    ENHANCED CREDIT PROFILE Total Debt Outstanding Exterran Holdings Debt to Adjusted EBITDA With our enhanced operating and financial positions, we believe that we are well-positioned to both navigate commodity price cycles and take…
  5. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 5
    Separation Plan 5 Exterran Holdings. All rights reserved.
  6. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 6
    UNLOCKING VALUE: CREATING TWO INDEPENDENT COMPANIES Archrock, Inc. (RemainCo) Exterran Corporation (SpinCo) Core Pure-play U.S. compression services International services & global fabrication Focus 2% GP1 and 39% LP1 interests…
  7. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 7
    STRATEGIC SEPARATION EXPECTED TO DELIVER SIGNIFICANT VALUE Opportunity to create value for shareholders Creates two industry-leading energy infrastructure companies Enhances overall long-term growth potential Provides strategic…
  8. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 8
    Archrock, Inc. (RemainCo) Overview 8 Exterran Holdings. All rights reserved.
  9. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 9
    KEY ARCHROCK INVESTMENT HIGHLIGHTS Fee-based contracts for must-run production and midstream infrastructure assets Cash Flow Stability Production, not exploration, leveraged business model results in more steady demand for services…
  10. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 10
    WHERE IS COMPRESSION USED Compression is an essential service utilized all along the production cycle to transport gas to the end user 82% of U.S. Fleet1 Power Generation Storage Industrial Residential Natural Gas Exports…
  11. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 11
    AFTERMARKET SERVICES OVERVIEW AMS Business Segments AMS Highlights Sales of field labor services concentrated around: Revenue stream from customers that Field Scheduled Maintenance Services Major Maintenance choose to own…
  12. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 12
    ARCHROCK WILL BE THE LEADING CONTRACT COMPRESSION SERVICES OPERATOR IN THE U.S. U.S. Outsourced Compression Competitors1 Archrock Highlights 4,000 Archrock will be a pure-play 3,618 3,500 Operating HP at EXH, to be renamed Archrock…
  13. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 13
    STABILITY OF BUSINESS MODEL Fee-based compression services provide stable cash flow Services Revenue and Oil & Gas Prices1,2 900 200% 800 150% 700 Revenue ( in millions) 600 100% Indexed to 12/31/08 500 50% 400…
  14. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 14
    GEOGRAPHIC DIVERSITY Presence in All Major U.S. Producing Basins HP by Play Type1 HP by Application1 ARCHROCK OPERATING UNITS Source: Energy Information Administration Note: Excludes offshore units in the Gulf of…
  15. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 15
    FAVORABLE CONTRACT OPERATIONS PROFITABILITY TREND Gross margin per horsepower benefitted from profit improvement initiatives and fleet high grading from the MidCon acquisitions Gross Margin per Horsepower per Month1,2 3 1…
  16. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 16
    OVERVIEW OF GROWTH STRATEGIES Demonstrated track record of executing all three growth strategies Distribution / Dividend Growth Demonstrated Capability Third Party Demonstrated ability to source & execute deals with MidCon…
  17. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 17
    DISTRIBUTIONS & COVERAGE Improvement in fleet profitability has led to strengthened coverage ratios at EXLP & increased distributions to EXH Distributable Cash Flow Coverage1 Distributions Declared to EXH 2 1 See Addendum I…
  18. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 18
    Exterran Corporation (SpinCo) Overview 18 Exterran Holdings. All rights reserved.
  19. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 19
    KEY EXTERRAN CORPORATION INVESTMENT HIGHLIGHTS Presence in approximately 30 countries Global Market Long history of reliable operations, technical expertise and product knowledge Leader Long-term customer relationships built on trust…
  20. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 20
    EXTERRAN CORPORATION OVERVIEW Exterran Corporation will provide compression, Gross Margin by Revenue by Geography1 Geography1,2 production and processing products and services Integrated suite of products across three business…
  21. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 21
    GLOBAL BUSINESS WITH LOCAL EXPERTISE Regional Headquarters Engineering and Manufacturing Centers Other Major International Locations North America Revenue: 1,073mm (50%) Kazakhstan Switzerland United States China Italy…
  22. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 22
    PRODUCTS AND SERVICES ACROSS THE VALUE CHAIN Natural Gas Sales Reciprocating Dehydration Screw Dewpointing Sweetening NGL extraction NGL stabilization Wellhead Oil Sales Separation Heating/Cooling Gas dehydration…
  23. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 23
    EXTERRAN CORPORATIONS INTEGRATED BUSINESS MODEL: OUR CUSTOMER SERVICE DRIVEN APPROACH Integrated Growth Description Financial Highlights Strategy Own and operate natural gas Revenue by Segment compression and production and…
  24. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 24
    STABLE, FEE-BASED CASH FLOWS UNDERPINNED BY INTERNATIONAL SERVICES BUSINESSES ICO projects largely tied to Historical ICO and AMS Gross Margin1 ( in millions) 400 100% long-term local infrastructure 264 351 340 313 317 319…
  25. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 25
    POSITIVE CASH GENERATION FROM LOW CAPITAL INTENSITY PRODUCT SALES BUSINESS 1,400 Product 1,262 Sales Backlog by Region ( in millions)1 2,000 1,200 1,064 953 Exterrans global engineering, supply chain 1,600 Revenue ( millions)…
  26. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 26
    Summary 26 Exterran Holdings. All rights reserved.
  27. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 27
    PROCESS OUTLINE Initial board authorization has been received Management teams and boards of Archrock (RemainCo) and Exterran Corporation (SpinCo) determined No shareholder approval required Next steps Raise debt financing for…
  28. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 28
    RE-CAP OF STRATEGIC RATIONALE Archrock (RemainCo) Exterran Corporation (SpinCo) Pure-play yield investment leveraged to significant Focused company leveraged to growth in global U.S. energy infrastructure redevelopment and energy…
  29. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 29
    Exterran Corporation Appendix 29 Exterran Holdings. All rights reserved.
  30. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 30
    HISTORICAL FINANCIAL PERFORMANCE EXTERRAN CORPORATION Revenue ( in millions) Gross Margin1 ( in millions) 33% 2,415 29% 27% 27% 27% 27% 2,173 2,164 24% 2,069 28% 1,963 23% 23% 1,809 1,840 1,662 597 576 23% 1,460 584 534 1,233…
  31. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 31
    ICO PROJECT MODEL STABILITY THROUGH THE CYCLES Project Initial Commercial Post Initial Commercial Execution Period Phase Contract Period Contract Contract award Exterran subject to meet agreed delivery Can be pre-agreed in original…
  32. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 32
    Addendum I: Exterran Holdings, Inc. and Exterran Partners, L.P. Non-GAAP Financial Measures 32 Exterran Holdings. All rights reserved.
  33. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 33
    NON-GAAP FINANCIAL MEASURES EXTERRAN HOLDINGS, INC. (to be Archrock, Inc. post-spin): Gross margin, a non-GAAP measure, is defined as total revenue less cost of sales (excluding depreciation and amortization expense). Gross margin…
  34. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 34
    NON-GAAP FINANCIAL MEASURES EXTERRAN HOLDINGS, INC.1 ( in millions) Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Q2-13 Q3-13 Q4-13 Q1-14 Q2-14 Q3-14 Q4-14 Q1-15 Q2-15 Revenues North America Contract Operations 142.1 142.1 143.1…
  35. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 35
    ( in millions) 2010 2011 2012 2013 2014 Revenues North America Contract Operations 568.9 570.8 596.0 627.8 729.1 International North America Contract Operations 465.1 445.1 464.0 476.0 493.9 Aftermarket services - North America…
  36. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 36
    (in thousands, except per HP amounts) 1Q 11 2Q 11 3Q 11 4Q 11 1Q 12 2Q 12 3Q 12 4Q 12 1Q 13 2Q 13 3Q 13 4Q 13 NACO Gross margin1 66,079 70,364 69,744 70,783 74,502 77,015 75,267 84,524 86,840 91,694 81,750 85,071 NACO Average Operating…
  37. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 37
    2010 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Q2-13 Q3-13 Q4-13 Q1-14 Q2-14 Q3-14 Q4-14 Q1-15 Q2-15 ( millions) Net income (loss) (113.2) (30.5) (30.2) (214.5) (64.4) 7.3 (166.9) 119.3 3.1 58.8 24.5 45.3 27.2 34.9 20.9 42.2…
  38. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 38
    ( in thousands) 2007 2008 2009 2010 2011 2012 2013 2014 Net income (loss) 19,401 29,847 14,784 (23,333) 6,053 10,509 64,023 61,719 Depreciation and amortization 16,570 27,053 36,452 52,518 67,930 88,298 103,711 128,196 Long-lived…
  39. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 39
    ( in thousands) 1Q 11 2Q 11 3Q 11 4Q 11 1Q 12 2Q 12 3Q 12 4Q 12 1Q 13 2Q 13 3Q 13 4Q 13 1Q 14 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15 Net income (loss) 223 (1,938) 3,253 4,515 4,505 (19,050) 10,380 14,674 14,733 27,896 10,035 11,359 6,939 17,752…
  40. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 40
    Addendum II: Exterran Corporation (SpinCo), excludes Archrock (RemainCo), Non-GAAP Financial Measures 40 Exterran Holdings. All rights reserved.
  41. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 41
    NON-GAAP FINANCIAL MEASURES EXTERRAN CORPORATION: EBITDA, as adjusted, a non-GAAP measure, is defined as net income (loss) excluding income (loss) from discontinued operations (net of tax), cumulative effect of accounting changes…
  42. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 42
    NON-GAAP FINANCIAL MEASURES (CONT.) EXTERRAN CORPORATION ( in millions) 2010 2011 2012 2013 2014 LTM Q2-15 Q1-14 Q2-141 Q1-15 Q2-151 Revenues ICO 465.1 445.1 464.0 476.0 493.9 484.4 111.0 134.4 120.7 115.3 AMS 120.6 162.3 145.0…
  43. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 43
    NON-GAAP FINANCIAL MEASURES (CONT.) EXTERRAN CORPORATION 2010 2011 2012 2013 2014 LTM Q1-15 Q1-14 Q1-15 ( millions) Net income (loss) 38.4 (232.3) 119.4 152.9 152.5 147.1 43.0 37.6 (Income) loss from discontinued operations, net of…
  44. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 44
    NON-GAAP FINANCIAL MEASURES (CONT.)1 EXTERRAN HOLDINGS 1 For the years ended December 31, 2008 and 2009, carve-out financial statements of Exterran Corporation have not been prepared. The amounts presented as Exterran Corporation…
  45. Johnson Rice Energy Conference – Exterran Holdings, Inc. – slide 45
    NON-GAAP FINANCIAL MEASURES (CONT.)1 EXTERRAN HOLDINGS ( in millions) 2008 2009 Net loss (935.1) (545.5) Selling, general and administrative 347.2 331.8 Merger and integration expenses 11.4 - Depreciation and amortization 323.1…

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