EnerCom: The Oil & Gas Conference August 16, 2017 Troy Meier Christopher Cashion Chairman and Chief Executive Officer Chief Financial Officer NYSE American: SDPI 2017 Superior Drilling Products www.sdpi.com
Superior Drilling Products, Inc. An innovative, cutting-edge drilling tool technology company providing cost saving solutions that drive production efficiencies for the oil and natural gas drilling industry Market Capitalization…
Innovator, Designer and Manufacturer History of innovation and manufacturing ingenuity Solutions for the upstream oil & gas industry Drill-N-Ream well-bore conditioning tool (DnR) Strider oscillating system technology Drilling…
Drill-N-Ream Well-bore Conditioning Tool Flagship technology Leading industry operators standardizing on tool Being used throughout North America Increased use of multiple tools Driver: Well bore quality Demonstrating value…
Teaming up with Success Market channel partnerships Go-to-market strategy: Qualified partners Drill-N-Ream distribution: Market leader in downhole tool rentals Exclusive marketing rights requires successful market penetration:…
Technology Continues to Change the Game Driving out inefficiencies 1,000 60 Quality well bore critical to improving 900 drilling efficiencies 50 800 WTI Spot Oil Price2 U.S. Rig Count1 Drill-N-Ream improves well bore quality…
Financial Results 2017 Superior Drilling Products
Significant Revenue Growth ( in millions) Total revenue in 2Q 2017 up 263% 3.4 4.0 over prior-year period Sequential total revenue increased 20% 2.5 2.3 2.3 Tool revenue comprised 61% of total 2.3 revenue Market expansion and…
Tool Revenue Strength Success with sales business model Sales revenue from fleet build out by channel partner Life of tool revenue stream: includes royalty and maintenance Positive trend in royalty and repair revenue demonstrates…
Strong Cost Discipline Operating Expenses ( in millions) YOY cost of revenue as a percent of sales lower on higher volume and tool 4.0 sales mix 3.7 3.6 3.6 2Q 2017 included 215 thousand in 1.2 3.2 0.9 revenue from used tools…
Created Better Margin Business Model Adjusted EBITDA* ( in thousands) Achieved positive Adjusted EBITDA 1,496 37% of revenue in 2Q 2017 910 64% increase over trailing quarter 2.6M higher than prior-year period 176 67 Generated…
Managing Balance Sheet ( in millions) Cash and Equivalents YTD cash used in operations: 2.2 0.3 million 1.3 1.3 Higher accounts receivable Positive cash from operations in 2Q; expect to generate cash in 2H 2017 12/31/2015…
2017 Guidance* Revenue: Approximately 14 million to 16 million Operating margin, excluding amortization: Approximately 16% to 18% Depreciation: 1.3 million to 1.4 million Amortization: Approximately 2.4 million Interest…
Opportunities Drill-N-Ream Market share expansion Strong customer acceptance in multiple basins Channel partner focused on meeting 12.5% goal by year-end Progress with channel partner relationships for international expansion…
EnerCom: The Oil & Gas Conference August 16, 2017 NYSE American: SDPI 2017 Superior Drilling Products www.sdpi.com
Supplemental Information NYSE American: SDPI 2017 Superior Drilling Products www.sdpi.com
Proven Industry Experience Troy Meier, Co-Founder, Board Chairman and CEO More than 33 years of experience in the oil and gas industry, including 13-year career with Baker Hughes Annette Meier, Co-Founder, Director, President and…
Drill-N-Ream Channel Partner Agreement Drill-N-Ream four revenue streams 1. New tool sales Assumes horizontal rig count remains at current levels Average selling price: 40 thousand; Ranges from 30 to 50 thousand 2. Replacement…
World-Class Manufacturing Facility Industry leading techniques Created machine tools and systems Fully contained & environmentally friendly facility CHUCK, SDPs proprietary paperless enterprise management system Brazing station…
Adjusted EBITDA Reconciliation Three Months Ended June 30, 2017 March 31, 2017 December 31, 2016 GAAP net income (loss) 306,807 (385,985) (2,595,946) Add back: Depreciation and amortization 899,373 938,022 912,034 Impairment of…
Adjusted EBITDA Reconciliation Full Year Ended June 30, 2017 TTM December 31, 2016 GAAP net loss (3,848,556) (9,110,621) Add back: Depreciation and amortization 3,681,679 4,291,249 Interest expense, net 1,037,670 1,299,667…
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