Advisories (Contd) Non-IFRS Measures: Financial measures in this presentation do not have a standardized meaning as prescribed by generally accepted accounting principles in Canada, which are International Financial Reporting Standards…
Transforming Natural Gas to Meet The Worlds Energy Needs PROVEN TRACK RECORD OF VALUE CREATION Focused on growth, maintenance, and handling of produced gas volumes. Complementary product lines and regions driving balanced revenue…
EXECUTIVE MANAGEMENT TEAM Marc Rossiter Sanjay Bishnoi Patricia Martinez President & CEO SVP, Chief Financial Officer Chief Energy Transition Officer & President, Latin America David Izett Greg Stewart Phil Pyle Helmuth…
ENERGY ACCESS IS FUNDAMENTAL TO SOCIAL PROGRESS Per Capita Energy Use vs. United Nations Human Development Index Score 7 Source: World Bank DataBank 2019; U.N. Human Development Reports.
CONSUMPTION TRACKS GDP GROWTH Global Gross Domestic Product (trillion 2015 US dollars) Global Aggregate Energy Consumption (000 Bcf equivalent) 300 1,000 History Projections High Economic 900 Non-OECD Growth 250 non-OECD 800 700…
GLOBAL ENERGY DEMAND IS SATISFIED BY A DIVERSE FUEL MIX Projected Global Energy Consumption (000 Bcf equivalent per year) 1,000 +31% ( 46,000 bcf) Global natural gas 900 consumption is projected 800 to increase by over 30%…
WITH GAS CONSUMPTION INCREASING ACROSS ALL SECTORS Global Natural Gas Consumption by Sector (000 Bcf) 225 175 Over time, natural gas use is expected to accelerate 125 from increased industrial activity, natural gas-fired…
SUPPORTING A LESS CARBON-INTENSIVE WORLD Pounds of CO2 emitted per thousand cubic feet Core products support a global transition Up to toward lower carbon fuel sources 49% Ancillary products support decarbonization 229 fewer CO2…
INCLUDING DURING AN ENERGY TRANSITION Electricity Generation from Select Fuels (billion kilowatthours) 45,000 40,000 Global energy demand will 35,000 continue to grow, primarily in 30,000 the form of electricity 25,000 Demand…
FOR WHICH ENERFLEX IS WELL POSITIONED ORGANICALLY Enerflex Cumulative Enerflex Firsts Energy Transition Projects 1982 1st e-Compression plant 150 CCUS projects 1983 1st CCUS plant 5 million tpy CO2 capacity 3 million hp Electric…
AND INORGANICALLY Enerflexs combination with Exterran creates a premier integrated global provider of energy infrastructure Transaction Highlights Announced on January 24, 2022 Expanded Product Lines and End Markets Enerflex to…
POSITIONED FOR GROWTH 15
ALL PRODUCED GAS REQUIRES COMPRESSION & PROCESSING (000 bcf) +46 200 193.2 150 147.3 Projected consumption increase of 46,0001 bcf by 2050 requires billions of compression, 100 processing, and maintenance investments…
GLOBAL LEADER IN DELIVERING NATURAL GAS SOLUTIONS Business Overview* Revenue: 960 MM Employees: 2,000 Operating Locations: 57 Manufacturing Facilities: 3 Countries: 17 Fleet HP: 800,000 Manufacturing Facility 0 90 bcf/d…
COMPLEMENTARY OFFERINGS ON A GLOBAL SCALE Engineered Systems Customized offerings for: Gas Compression and Gas Vertically Integrated platform Processing Plants, refrigeration solutions, Cryogenic Plants, Electric Power Generation,…
SOLUTIONS FROM THE WELLHEAD TO PIPELINE 19
DIVERSIFICATION STRATEGY USA Complementary offerings of Canada diversified product lines in diversified geographies ROW Vertically Integrated platform provides differentiation Focused on growth and Engineered maintenance of…
ADDITIONAL FOCUS ON RECURRING REVENUE GROWTH Engineered Systems Recurring revenues stabilize financial performance Higher margins versus manufacturing Strategic goal of generating Integrated Turnkey (ITK) 50% of revenue from…
WHAT IS ENERGY INFRASTRUCTURE 1 Products engineered, built, 2 Leased to Customers for and owned by Enerflex varying durations on a take-or- Energy Infrastructure pay basis = Contract Compression + BOOM 4 3 Contracted…
RATIONALE FOR ENERGY INFRASTRUCTURE PLATFORM Energy Infrastructure Revenues vs. Engineered Systems Bookings(1): EV/NTM EBITDA Multiples(2): C in millions 800 80 10 9 700 70 8 600 60 7 500 50 6 400 40 5 4 300 30 3 200 20 2 100…
CONTRACT COMPRESSION Contract Compression = leasing of necessary upstream gas compression infrastructure Demand is driven by both new production and maintenance of existing volumes Take-or-pay arrangements oriented toward…
STRONG U.S. CONTRACT COMPRESSION FUNDAMENTALS U.S. Contract Compression Market (million horsepower)(1) 16.0 History Forecast Changing field conditions 15.0 require continual equipment 14.0 modification, making leasing an 13.0 7%…
CAPTURING OPPORTUNITIES IN A SUPPORTIVE MARKET Low 35% 200% 89% High 47% Mid 18% Growth of US fleet from USA contract Diversified horsepower 130,000 hp to compression fleet profile across contract 400,000 hp since…
BUILD OWN OPERATE MAINTAIN BOOM Any Engineered System or Build-Own- ITK product on a Build- Operate-Maintain Own-Operate-Maintain (BOOM) basis in all target markets Larger scale compression and processing facilities…
BOOM EXPERIENCE CONTINUES TO GROW Early Processing and Compression Development Compression Facility, Bahrain Facility, Oman Facility, Oman Compression Processing and Early Production Compression Compression Gas Compression…
PRIORITY TO GROW RECURRING REVENUES Recurring Revenue C in millions 700 7% CAGR1 618 606 597 600 537 521 Recurring revenue 500 486 471 462 303 growth through 400 375 395 327 organic investment Recurring revenue has 321…
ENERGY INFRASTRUCTURE RISKS 01 Counterparty Credit 03 Asset Performance 02 Well and/or basin dynamics Risks mitigated when paired with financial + basin due diligence and Enerflex AMS 30
OPTIMIZED PLATFORM POSITIONED FOR GROWTH 1 2 VERTICAL INTEGRATION FINANCIAL STRENGTH Differentiated global Manufacturing cash platform with product flows fund investment in line synergies Energy Infrastructure platform 3 4…
COMMITTED TO SAFETY 2021 Global Consolidated Safety Record:1 0.23 0.50 0.33 LTI TRIR MVIR Total of Lost Total Recordable Motor Vehicle Time Incidents per Injury Rate per Incidents per 200,000 exposure 200,000 exposure 1,000,000…
ENHANCING AND STRENGTHENING COMMUNITIES Corporate citizenship through wellness and community development initiatives is an integral part of Enerflexs vision 33
FOCUSED REGIONAL PRESENCE 34
USA USA1 Eng. Systems 218 MM Service 154 MM Gas infrastructure Energy Infrastructure 98 MM Total Revenue 470 MM Fleet: 400,000 HP Average Fleet Utilization: 89%2 demand driven by gas % of Consolidated Revenues1 production…
REST OF WORLD LATIN AMERICA Rest of World1 Eng. Systems 23 MM Service 111 MM Energy Infrastructure 176 MM Total Revenue 310 MM Fleet: 355,000 HP Regional gas production is expected to grow by % of Consolidated Revenues1…
REST OF WORLD MIDDLE EAST / AFRICA The Middle East accounts for 35% of the worlds proven gas reserves 145,000 horsepower of owned and installed gas Rest of World1 % of Consolidated Revenues1 compression and Eng. Systems…
CANADA % of Consolidated Revenues1 Canada Eng. Systems Canada1 113 MM 19% NGL recovery drives Service Energy Infrastructure 62 MM 5 MM USA 49% infrastructure demand Total Revenue 180 MM Fleet: 45,000 HP ROW 32% in…
DISCIPLINED GROWTH THROUGH STRATEGIC INVESTMENTS CAPEX, M&A and ROCE % Less Product Organic cyclicality, sale cash flows Reinvestment investment + M&A Leads to sustained growth + 1.5B reinvested over returns the past nine…
BUSINESS MIX DRIVES PROFITABILITY Margin expansion supported by a growing energy infrastructure platform underpinned by take-or-pay arrangements Revenue and Gross Margin1 by Product Line Adjusted EBITDA and Adjusted EBITDA Margin %…
POSITIVE FREE CASH FLOW AND BALANCE SHEET STRENGTH Free Cash Flow Before Net Capital Spending(1) Net Debt to Adjusted EBITDA(2) C in millions 240.8 2.38 190.4 1.79 1.54 143.2 136.2 1.19 1.13 126.5 1.09 0.97 114.2 112.8…
DIVIDEND HISTORY Annually (C/share) 0.50 0.46 0.45 0.42 0.40 0.38 0.35 0.34 0.34 0.34 Enerflex has 0.30 0.28 0.30 maintained a 0.25 0.24 dividend through the 0.20 cycles since 2011 0.18 0.15 0.10 0.085 0.05 0.00 2011…
IGNITING THE FUTURE OF ENERGY 45
GO FORWARD CAPITAL ALLOCATION PHILOSOPHY Following 2022s Transaction-related capital project commitments, capital allocation in 2023+ will prioritize: balance sheet strength, sustainable shareholder returns, and growth Maintain ample…
EXECUTING ON A POWERFUL STRATEGY Proven track record of Creating Shareholder Value Strong balance sheet and free cash flow allows Enerflex to pursue strategic growth opportunities to further expand the business. Revenues derived…
APPENDIX RECONCILIATIONS 48
FREE CASH FLOW 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Cash provided by operating activities 134,795 134,208 69,024 64,611 104,173 91,792 179,251 242,868 54,169 220,248 225,155 Net change in non-cash working capital and…
GROSS MARGIN PROFILE BY PRODUCT LINE Three months ended December 31, 2021 Engineered Energy ( Canadian thousands) Total Systems Service Infrastructure Revenue 321,347 142,263 90,854 88,230 Cost of goods sold: Operating expenses…
COMPOSITION OF BORROWINGS ( Canadian thousands) December 31, 2021 December 31, 2020 Drawings on Bank Facility1 30,522 84,369 Drawings on Asset-Based Facility1 37,411 Notes due June 22, 2021 - 40,000 Notes due December 15, 20241…
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