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Credit Suisse 25th Annual Energy Summit – MRC Global Inc.

MRC Global Inc. · Mar 3, 2021 · 34 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.

Slides

  1. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 1
    Credit Suisse 25th Annual Energy Summit 1 Credit Suisse 25th Annual Energy Summit March 3, 2020 Kelly Youngblood Executive Vice President & CFO Monica Broughton Investor Relations
  2. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 2
    Credit Suisse 25th Annual Energy Summit 2 Forward Looking Statements and Non-GAAP Disclaimer This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act Statement Regarding Use of…
  3. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 3
    Credit Suisse 25th Annual Energy Summit 3 Global Leader in PVF Distribution Largest pipe, valves and fittings (PVF) distributor TTM Sales of 3.7B Upstream 30% Industrial Distributor with Diversified Business Mix Counter-cyclical…
  4. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 4
    Credit Suisse 25th Annual Energy Summit 4 Strategy for Creating Shareholder Value Maximize Working Optimize Capital Grow Market Share Maximize Profitability Capital Efficiency Structure Focus on higher margin Optimize…
  5. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 5
    Credit Suisse 25th Annual Energy Summit 5 Compelling Investment Opportunity Market leader in PVF distribution, serving critical function to the energy industry Diversified across sectors, regions and customers Counter-cyclical…
  6. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 6
    Credit Suisse 25th Annual Energy Summit 6 Diversified by Region, Industry Sector and Product Line - Well Positioned Through Cycle Revenue by Geography Revenue by Product Line Stainless Steel Alloy Pipe & Fittings International…
  7. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 7
    Credit Suisse 25th Annual Energy Summit 7 Upstream Providing Completion Infrastructure to E&P Operators Provide well hook-ups via on-site product trailers, above-ground infrastructure PVF products for flow lines & tank batteries…
  8. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 8
    Credit Suisse 25th Annual Energy Summit 8 Midstream Providing PVF to Pipeline Infrastructure Customers and Gas Products to Gas Utility Customers Gas Utilities Business drivers: o independent of commodity prices o integrity…
  9. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 9
    Credit Suisse 25th Annual Energy Summit 9 Downstream Providing PVF to Refining, Chemical & Industrial Customers Refining Recurring MRO revenue from planned & unplanned maintenance Provide on-location zone store inventory…
  10. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 10
    Credit Suisse 25th Annual Energy Summit 10 MRC Global is a Critical Link Between Its Customers & Suppliers Energy Carbon Steel Tubulars Valves Fittings, Flanges and Other Customer Value Proposition Outsource non-core supply…
  11. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 11
    Credit Suisse 25th Annual Energy Summit 11 Global Footprint Strategically Located in Key Geographies to Deliver Solutions to Customers North America International Stavanger, NO Nisku, AB CANADA NORDIC Bradford, UK Munster,…
  12. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 12
    Credit Suisse 25th Annual Energy Summit 12 MRC Global is committed to responsible governance of the enterprise and its interaction with its stakeholders. Core Values Drive Actions for All Stakeholders 2018: Top Quartile Safety…
  13. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 13
    Credit Suisse 25th Annual Energy Summit 13 End Market Growth Opportunities UPSTREAM Secular growth in oil & gas demand drives E&P capital and maintenance spending Steep shale decline curves and manufacturing mentality for shale…
  14. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 14
    Credit Suisse 25th Annual Energy Summit 14 Strong Record of Customer Contract Wins and Renewals Yields Growth Opportunities 1. Renew Existing & Obtain New MRO Contract Selected Recent Contract Awards and Renewals Customers…
  15. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 15
    Credit Suisse 25th Annual Energy Summit 15 Houston Operations Complex at La Porte, TX Supporting Growth & Continued Operational Efficiencies More than 620,000 sq. ft. of space to deliver our customers actuation, modification…
  16. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 16
    Credit Suisse 25th Annual Energy Summit 16 MRC Globals Valve-Centric Strategy U.S. oil & gas valve sales were 5.2B1 (2.6B through distribution) 2.2B Upstream & Midstream 3.0B Downstream MRC Globals 1 is in U.S. distributed…
  17. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 17
    Credit Suisse 25th Annual Energy Summit 17 Market Penetration in Midstream Valves: Investment in Value-Added Valve Modification Capabilities New midstream Valve Engineering & Modification Center at La Porte complex in-house…
  18. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 18
    Credit Suisse 25th Annual Energy Summit 18 Maximizing Profitability: Expanding Higher Margin Opportunities - Valve Products & Services Positioning Offerings to Higher Margin Products & Services 2013 Sales - Product Mix 2019 Sales…
  19. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 19
    Credit Suisse 25th Annual Energy Summit 19 U.S. Gas Utility Business Largest provider of products & services to U.S. Gas Utilities Expect to build a 1 billion revenue base in 2-3 years Contracts with 18 of the top 25 largest gas…
  20. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 20
    Credit Suisse 25th Annual Energy Summit 20 Maximizing Profitability and Working Capital Efficiency Product Margin Investment in higher margin products and services: Portfolio Optimization Enhancement VAMI services - Valve…
  21. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 21
    Credit Suisse 25th Annual Energy Summit 21 Investing in Technology for Long-Term Growth & Efficiency MRCGOTM - A Comprehensive Digital Supply Chain Solution for Oil & Gas Pipe, Valve & Fitting Purchases End-to-end digital supply…
  22. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 22
    Credit Suisse 25th Annual Energy Summit 22 E-Commerce Platform Capabilities Increase Efficiencies Mill Test Reports (MTRs) Catalog Order status history Online chat Proof of Delivery (POD) View inventory Expedite a delivery PVF…
  23. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 23
    Credit Suisse 25th Annual Energy Summit 23 Strategic Capital Decisions Support Growth Effectively Positioned the Balance Sheet = Capital Deployment Opportunities Advantageous debt agreements with favorable terms, low interest…
  24. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 24
    Credit Suisse 25th Annual Energy Summit 24 Capital Allocation Opportunities and Priorities All options are available & evaluated continually Return Cash to Organic Growth Shareholders Working capital for business Track record…
  25. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 25
    Credit Suisse 25th Annual Energy Summit 25 Quarterly & YTD Financial Performance ( millions, except per share data) Sales Adjusted Gross Profit and % Margin1 819 714 4,172 3,662 1,009 942 202 188 766 146 20.0% 20.0%…
  26. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 26
    Credit Suisse 25th Annual Energy Summit 26 Strong Balance Sheet Provides Financial Flexibility ( millions) Total Debt Capital Structure December 31, 684 2019 627 Cash and Cash Equivalents 32 551 Total Debt (including…
  27. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 27
    Credit Suisse 25th Annual Energy Summit 27 Strategy - 4Q19 Accomplishments Grow Market Share Added new customer contracts and awards (e.g. Chevron Canada, INEOS) Maximize Achieved 40% of revenue from valves in 4Q 2019 and 39%…
  28. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 28
    Credit Suisse 25th Annual Energy Summit 28 Appendix
  29. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 29
    Credit Suisse 25th Annual Energy Summit 29 Financial Outlook (as of February 14, 2020 earnings call) 2020 Outlook Revenue Profitability & Cash Flow 2020 annual 3,200 to 3,700M Adjusted Gross Profit 19.6% to 19.8% By sector…
  30. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 30
    Credit Suisse 25th Annual Energy Summit 30 Impact of Tariffs Work Closely with Customers to Optimize the Global Supply Chain In general, inflation is a positive Multiple tariffs levied from Section 232 and Section 301 directly or…
  31. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 31
    Credit Suisse 25th Annual Energy Summit 31 Annual Financial Performance ( millions, except per share data) Sales Adjusted Gross Profit and % Margin1 5,933 1,120 5,571 1,058 5,231 1,009 4,529 814 819 4,172 3,646 3,662 677…
  32. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 32
    Credit Suisse 25th Annual Energy Summit 32 Balance Sheet ( millions) Total Debt Capital Structure December 31, 1,447 2018 1,245 Cash and Cash Equivalents 32 978 Total Debt (including current portion): Term Loan B due 2024…
  33. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 33
    Credit Suisse 25th Annual Energy Summit 33 Adjusted Gross Profit Reconciliation Expected for year Three months ended Year ended December 31 ending December 31 (mid-point) ( millions) Dec 31, 2019 Sept 30, 2019 Dec 31, 2018 2019…
  34. Credit Suisse 25th Annual Energy Summit – MRC Global Inc. – slide 34
    Credit Suisse 25th Annual Energy Summit 34 Adjusted EBITDA Reconciliation Expected for year Three months ended Year ended December 31 ending December 31 (mid-point) ( millions) Dec 31, 2019 Sept 30, 2019 Dec 31, 2018 2019 2018…

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