CFA Society Calgary 13 th Annual Oilfield Services Breakfast

Transcription

1 CFA Society Calgary 13 th Annual Oilfield Services Breakfast March 19,

2 Forward Looking Statements Certain statements contained in this presentation, including statements which may contain words such as anticipate, could, continue, should, seek, may, intend, likely, plan, estimate, believe, expect, will, objective, ongoing, project, view and similar expressions relating to oil and gas service industry activity estimates, estimates of drilling activity, oil and natural gas supply and demand estimates, estimates of Canadian wells required to maintain production, realization of the benefits from the C&J transaction, potential acquisition opportunities in the current market, expectations with respect to the relaxation of financial covenants in the Company s credit facility and similar facts and similar expressions and statements relating to matters that are not historical facts, are forward-looking statements. Such forward-looking statements involve known and unknown risks and uncertainties which may cause the actual results, performances or achievements of CWC to be materially different from any future results, performances or achievements expressed or implied by such forward-looking statements. Such factors include fluctuations in the market for oil and gas and related products and services; competition; our ability to integrate and manage acquired businesses; new products and services developed by CWC; the demand for services provided by CWC; changes in laws and regulations, including royalties and environmental, to which CWC or its customers are subject; CWC s ability to attract and retain key personnel and other factors affecting both the oil and gas business and oilfield services

3 Art of Transformation How Canada s Energy Sector Needs to Adapt & Change to Remain Competitive Rethink Business Model Adopt New Strategies Embrace Technology Leverage Core Competencies to: Expand into New Production Lines Win Customers in Other Industries Enter New Geographies 3 3

4 What Do We Do? Contract Drilling Production Services 9 Drilling Rigs (9 active) 148 Service Rigs (92 active) 13 Swabbing Rigs (8 active) 9 Coil Tubing (8 active) 2018 ACTUAL 2019 ESTIMATE REVENUE EBITDA REVENUE EBITDA 26% 74% 37% 18% 63% 82% 30% 70% 46% 54% Production Services Contract Drilling 4 4

5 Where Do We Work? Across the WCSB From BC to SK in all the oil and natural gas plays

6 Horizontal Drilling - Efficient 6 6

7 Horizontal Drilling & Fracturing 7 7

8 Fracturing site Source: Canyon Technical Services Ltd. website 8 8

9 Innovation & Technology 9 9

10 WCSB Equity Raised 1993 to

11 WCSB 2019 Cash Life Cycle Source: CIBC The Roughneck Review (March 6, 2019)

12 WCSB Drilling Rig Count

13 TTM Revenue & EBITDA 2014 to

14 Financial Results & Position ($ millions) Revenue $144.8 $112.2 $73.1 $81.3 $143.7 Adjusted EBITDA 1 $18.5 $16.1 $8.2 $12.0 $34.1 Funds from Operations 1 $18.5 $14.5 $8.2 $12.0 $33.2 Net Income (loss) $(1.7) $4.9 $(7.5) $(29.1) $(13.5) Long-Term Debt $44.9 $49.8 $33.1 $52.2 $65.7 Net Debt 1 $25.9 $30.3 $21.8 $40.4 $45.1 Cash Dividend nil nil nil $2.5 $14.5 Cash Dividend Payout Ratio (Cash Dividend/FFO) n/a n/a n/a 21% 44% 1 Refer to the Reconciliation of Non-IFRS Measures in the Management s Discussion and Analysis filed at

15 Capital Expenditures Summary ($ millions) 2019 Budget Maintenance/Infrastructure $5.4 $5.9 $5.2 $2.7 $4.7 Growth Organic nil $5.9 $1.8 nil $4.5 Growth M&A n/a nil $37.5 nil nil Total $5.4 $11.8 $44.5 $2.7 $9.2 Maintenance Capex: Level IV recertification for four single service rigs. Upgrades or additions to crew cabs/vehicles, recertifications for field equipment for drilling rigs, service rigs and IT infrastructure

16 How Do We Fix Canada? WE NEED PIPELINES!!! Bill C-69 needs significant overhaul by senators Keep National Energy Board s established process Clarity over duty to consult Amend ambiguous terms that require court interpretation Regulatory independence vs. political discretion. Remove discretion Have Impact Assessment Agency make recommendation not just a report Focus on positive impacts of national and regional growth, prosperity, competitiveness and opportunities for Indigenous economic reconciliation Make the whole process efficient with stated timeframes including clear policies on climate change and Indigenous rights

17 How Do We Fix Canada? A Canadian Energy Brand, a PSAC led initiative

18 Share Price Performance CWC +67%

19 CWC Energy Services Corp. Suite 610, 205 5th Avenue SW Calgary, AB T2P 2V7 Phone: (403) Fax: (403) Duncan Au, CPA, CA, CFA President & Chief Executive Officer Stuart King, CPA, CA Chief Financial Officer 19