NINE ENERGY SERVICE INVESTOR PRESENTATION Q1 2019 1
COMPANY OVERVIEW
NINE COMPANY OVERVIEW OUR COMPANY Focused on ROIC 2019 annual target of 7% Leveraged to increasing completion intensity including mega-well pads, lateral lengths and stage count Super lateral, deep reach capable service offering…
NINES UNIQUE STRATEGY Sustainability Returns (ROIC) Mitigation of financial risk Cash flow generative Capital Intensity Capital Light Wellsite Execution Customer Legitimacy Real-time information R&D 5
DRIVING VALUE FOR CONSTITUENTS CUSTOMERS Ability to decrease cost to complete and increase EUR VALUE EMPLOYEES INVESTORS Socioeconomic Financial movement & career Sustainability progression & Returns 6
TECHNOLOGY-DRIVEN COMPLETIONS OFFERING Nine is capable of addressing 100% of the onshore wells drilled in North America, regardless of completion type PRE & POST STIMULATION HORIZONTAL LATERAL TOE OF THE WELL Large Diameter Coil +…
PREMIER ISOLATION TOOL PROVIDER ABLE TO SERVE THE ENTIRE ADDRESSABLE ISOLATION TOOL MARKET WITH PROVEN DISSOLVABLE AND COMPOSITE OFFERINGS 2 MARKET SHARE IN DISSOLVABLE FRAC PLUGS AND 1 IN POLYMER-BASED (PLASTIC) DISSOLVABLE PLUGS…
INTEGRATED COMPLETIONS SOLUTION NINE CAN HELP OPERATORS DESIGN AND EXECUTE THE MOST COST-EFFICIENT AND PRODUCTIVE DEEP-REACH LATERALS THROUGH BROAD OFFERING OF COMPLETION TOOL PORTFOLIO ILLUSTRATIVE HYBRID WELLBORE SOLUTION FlowGun…
SUSTAINABLE VALUE PROPOSITION OF SERVICE & TECHNOLOGY Service and technology drives efficiencies and lowers total cost of ownership for operators SERVICE/TECHNOLOGY PERFORMANCE DAYS SAVED REVENUE GENERATION FOR OPERATORS1 BreakthruTM…
MULTI-WELL PADS CONCENTRATE RISK BARRIERS TO ENTRY AND OPERATIONAL EFFICIENCIES CONTINUE TO INCREASE SINGLE-WELL PAD COMPLETIONS MULTI-WELL PAD COMPLETIONS LONGER LATERALS TIGHTER SPACING PAD DRILLING l l Concentration of dollars…
BROAD FOOTPRINT ENABLES TECHNOLOGY LEADERSHIP FOOTPRINT IN EVERY Canada 4% MAJOR NAM BASIN EXCELLENT NAM REACH CAPABILITY Bakken 6% LOCALIZED TEAMS WITH REGIONAL Rockies 3% KNOWLEDGE Marcellus / Utica 19% MidCon 10%…
BARRIERS TO ENTRY THROUGH TECHNOLOGY AND SERVICE HOW DOES NINE BUILD MOATS AROUND THE BUSINESS Service + technology / equipment + people to service the longest laterals today and tomorrow COMPLETION SOLUTIONS PERFORMANCE BARRIERS…
ADVANCEMENTS IN CEMENTING SOLUTIONS SLURRY HIGHLIGHTS Light-density slurry engineered to build strength 60% faster and deliver 40% higher compressive strength than similar density slurries Blend 27 Provides the lightness needed…
CONSISTENT PROFITABLE MARKET SHARE GAINS Demonstrated Market Share Gains Throughout Cycles +233% 20% 16% 11% 8% 6% 6% 2014 2015 2016 2017 2018 Q1 2019 Nine US Wireline & Completion Tools % of stages completed1 Nine Holds a…
ASSET LIGHT BUSINESS MODEL PRESSURE PUMPING E-LINE Pressure pumping E-line 16
CUSTOMERS WHO TRUST US Diverse, blue-chip customer base with minimal concentration COMPLETION PRODUCTION 17
SAFETY IMPROVEMENT THROUGHOUT NINE NINE TRIR 2.47 64% 1.50 1.44 REDUCTION 1.26 0.88 2014 2015 2016 2017 2018 18
RETURNS-FOCUSED GROWTH PHILOSOPHY Balance of Organic Growth and Strategic M&A: Augment technology portfolio + Enhance NAM footprint ORGANIC GROWTH DISCIPLINED M&A Strategic expansion of existing service lines within NAM Continue to…
FINANCIAL OVERVIEW 20
Q1 2019 FINANCIAL SNAPSHOT Q1 2019 FINANCIAL & OPERATIONAL PERFORMANCE Q1 2019 results in-line with Managements Guidance with one of the highest adjusted EBITDA margins 230 REVENUE amongst peers Net Income of 17.3mm and basic…
3/31/19 CAPITALIZATION PRO FORMA CAPITALIZATION COMMENTARY As of March 31, 2019 During Q1, Nine paid down approximately (MM) 20 million of the outstanding ABL credit facility borrowings Cash 31.2 Total liquidity of 160.9 million as…
UNIQUE VALUE PROPOSITION Completions focused Technology and service differentiation Ability to service the most technically demanding wells Returns-focused business philosophy Access to entire addressable market Leading market…
CLOSE TO PERFECTION. FAR FROM ORDINARY. DRIVEN TO SUCCEED. 24
APPENDIX
OUR LEGACY 26
2018 FINANCIAL PERFORMANCE REVENUE (MM) 2018 FINANCIAL AND OPERATIONAL HIGHLIGHTS 827 2018 ROIC of 12% for legacy Nine business, +52% 544 exceeding Managements target of 8% and 8% for consolidated Nine, Magnum and Frac Tech…
NINE ADJ. EBITDA RECONCILIATION Three Months Ended Year ended December 31 ( mm unless otherwise noted) 31-Mar-19 31-Dec-18 30-Sep-18 30-Jun-18 31-Mar-18 2018 2017 EBITDA Reconciliation Net income (loss) 17.3 (77.3) 13.7 9.0 1.7 (53.0)…
Q1 2019 ROIC RECONCILIATION Three Months Ended ( MM UNLESS OTHERWISE NOTED) 31-Mar-19 After-tax net operating profit reconciliation: Net Income (loss) 17.3 Add back: Impairment of property and equipment - Impairment of goodwill -…
2018 ROIC RECONCILIATION Nine Legacy Consolidated Three Months Ended Year Ended Three Months Ended Year Ended ( MM UNLESS OTHERWISE NOTED) 31-Dec-18 31-Dec-18 31-Dec-18 31-Dec-18 Net Loss (77.3) (53.0) (77.3) (53.0) Add back:…
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