WORLDWIDE EXPERTS IN WATER TREATMENT TSX: OVI.A and OVI.B 1 INVESTOR PRESENTATION MARCH 2016
Forward-Looking Statements Certain information and statements contained in this presentation regarding management s objectives, projections, estimates, expectations or forecasts may constitute forward-looking statements within the meaning of applicable securities legislation. Management of Ovivo Inc. would like to point out that forward-looking statements involve a number of uncertainties and known and unknown risks such that the actual and future results of Ovivo could differ considerably from those stated. Additional information about the risks and uncertainties that could cause actual results to differ from expectations is provided in Ovivo s Management s Reports for the fiscal year ended March 31, 2015 and for the quarter ended December 31 st, 2015. All amounts are in Canadian dollars. The M$ symbol stands for million dollars. 2 2
We are A Pure Water Treatment Company A Technology Provider We design and sell equipment, systems and parts & services We take no construction risk Experts having Proprietary Products and System Integration Knowhow to treat the most challenging water in the world A powerful Global Brand with renowned Trademarks and a huge Installed Base of equipment around the world 3
Our Financials at a Glance Ovivo Inc. shares are traded on the Toronto Stock Exchange Ticker Symbols: OVI.A and OVI.B Share Price : $2.18 Market Capitalization: $96 M Net Debt: $14 M Enterprise Value: $110 M Key Financial Metrics LTM Revenues: $319 M LTM Adjusted EBITDA: $15 M Backlog: $283 M Revenue guidance for FY 2016 : $320 M * 4 5 * Fiscal Year-end is on March 31 st, 2016 Share Price and Market Capitalization as at March 1 st, 2016 / Balance Sheet and Backlog data as at Dec. 31, 2015 / Income Statement data are LTM ending Dec. 31, 2015
We Regrouped the Strongest Experts and Brands in the Industry 1991 Acquisition DORR-OLIVER Industrial Wastewater 2004 Creation Water Treatment Group 2005 Acquisition Jones + Attwood Headworks, Municipal Waste Water with presence in Europe and North America 2009 Acquisition CHRIST WATER TECHNOLOGY Pure and UltraPure Water Strong presence in Europe & Asia, Industrial Markets 2002 Acquisition EIMCO Municipal Wastewater Strong presence & reputation in North America 2005 Acquisition BRACKETT GREEN Headworks, Industrial and Municipal Wastewater. Strong presence in Europe, North America, Middle-East, Asia 2006 Acquisition ENVIROQUIP Municipal Wastewater, MBRs Strong presence in USA 2010 Creation of OVIVO Umbrella Brand 5
We Built an Integrated Global Platform 800 Employees Head Office in Montreal, Canada Canada United Kingdom Netherlands Germany Austria Revenue Geographic Breakdown* United States France Switzerland Hungary India China North America United Arab Emirates Taiwan Singapore 31% 54% Europe Australia 15% Rest of the World Knowledge & Service centers Service Centers * Last Twelve Month as at December 31, 2015 based on destination address 6
We have Clear Growth Objectives Current Fiscal Year FY 2016 Revenues Guidance: $320 M LTM Adjusted EBITDA: $15.2 M * Low Net Debt: $14.4 M * Our Objectives for FY 2020 $600 M in Revenues including $175 M through Acquisitions 6% Annual Organic Growth Improve EBITDA Margin to reach 8%+ 7 * as at Dec. 31, 2015
Our Positive Outlook is Supported by Strong Macro Drivers Growing world population (Support the growth from 7.3 billion human beings on earth today to close to 10 billion in 2050) Urbanization and improving living conditions in developing countries will increase water consumption (agriculture, domestic, industry) Aging infrastructures in developed countries ( 1 trillion US$ of investments will be required in USA in the next 25 years) Increasingly strict regulation for water and discharge of wastewater Climate change-induced water scarcity and floods will increase the need for sustainable water solutions, such as reuse and recycling Ovivo s Addressed Market $60 B PER YEAR 8
We Do Business in High Growth Markets MUNICIPAL INFRASTRUCTURE North America ELECTRONICS (Microchips, LCD, Circuit board) ENERGY (Power, Petrochemicals, Oil & Gas, LNG) 9
Customer Service Maintenance, Operations, Training, Replacement (P&S) Project Identification Business Development and Sale to endusers, EPC Contractors and Consultants Start-up & Commissioning Our Business Model is Strong Design and Engineering Meeting our Clients Specifications Installation Supervision Total Life Cycle Procurement Manufacturing Outsourcing Equipment's Delivery on Site Project Management 10 11
Our customers are Blue Chips Municipalities Energy Electronics END-USERS EPC CONTRACTORS CONSULTANTS 11
Intake Filtration Projects Ras Laffan, ME One of the largest Industrial intake facility in the world at 350 m 3 /sec. Lingo Ao Nuclear, China Four units at 60 ft. diam. with total flow at 100 m 3 /sec Asaluyah Petrochemical, ME Six units at 60 ft. diam. With total flow at 120 m 3 /sec 12
Pure & Ultrapure Water Production Projects Saudi Arabia Rabigh Project Six Conesep Condensate Polishing units of each at 2500 m 3 /hr each supplied to Doosan for Saudi Arabia Rabigh project South Africa Medupi project 9 banks of first & second pass Reverse Osmosis Systems for Boiler Feed with total of 1200 m 3 /hr at Medupi project GlobalFoundries Fab 8, NY Ultrapure water treatment system for 1200 gpm of ultrapure water supplied to a state-of-theart 300mm wafer foundry in Malta, NY 13
Wastewater Treatment Projects Grand Turk, Cozumel & Dominican Republic Ovivo supplied 3 microblox Systems for Carnival Corp. Cruise Centers partnering with them to pursue Carnival s corporate dedication to the environment. Canton, OH The largest MBR installation in the USA. Upgrade its water reclamation facility from 39 MGD to 88 MGD. GlobalFoundries Fab 8, NY Wastewater treatment system for industrial and hydrofluoric waste from a state-of-the-art 300mm wafer foundry 14
Quarterly Results Evolution Our Operating Performance is Improving 15
Our Parts and Services Business is a Profit Driver 100 90 80 70 60 50 40 30 20 10 0 Revenues from Parts & Services ($M) 93 84 67 56 FY 2013 FY 2014 FY 2015 LTM Q3-16 Perfectly complements our new equipment technology solutions offering Recurring revenues / attractive profit margins Significant investments in resources and electronic tools since FY 2013 Capitalizing on our large installed base of equipment and heritage brands Over 50% increase in backlog year-over-year Revenue growth of over 50% since FY 2013 16
Financial Position as at December 31, 2015 Our Balance Sheet is Solid Total Net Debt $14.4 M Shareholders' Equity $133.0 M -10 10 30 50 70 90 110 130 150 Total net debt of $14.4 M is 0.95x LTM EBITDA $40 M invested in net assets related to discontinued activities as at March 31, 2015: $12 M already collected during the first nine months of FY16 and $28 M to be collected over the next 2 to 3 years The monetization of these non-core assets will help finance our growth 17
Financial Position as at December 31, 2015 We have Good Financial Flexibility $25 M FTQ non-convertible debenture extended to November 2018 Revolving credit facilities committed until November 2017 Credit Facilities ($M) For general corporate purposes 3 57 60 For letters of credit issuances 51 29 80 0 10 20 30 40 50 60 70 80 90 Used Available 18
Looking Ahead 19
We have Strong Fundamentals More than 150 years of Expertise and References to treat the Most Challenging Water Experienced Management Team Huge Installed Base = Growing P&S Recurring Revenues Low Capex Requirements Acquisition and Organic Growth Opportunities Low Net Debt = Positioned for Growth 20
Looking Ahead Our FY 2017 to FY 2020 Strategic Plan 21 22 Municipal Electronics Energy Parts & Services Continue Expanding our Expertise in our Core Markets Continue Growing our P&S Business and our Installed Base of Equipment Reuse & Recycling R&D & Innovation $ Resource recovery Add new Breakthrough Technologies to our Platform Invest 1% to 2% of total Revenues in Product Innovation Growth Objectives for FY 2020 $600 M of Revenues including $175 M through Acquisitions 6% Organic Growth Improve EBITDA Margin to reach 8%+
In Summary Why invest in Ovivo? 1) Unique Pure Play in Water Treatment 2) Refocus and Turnaround Completed 3) Global Platform to Introduce new Technologies 4) Favorable Macro Drivers for the Future 5) Financial Flexibility to Finance our Growth Plan 6) Highly Fragmented Market (M&A Opportunities) 22
Thank you! 23 TSX: OVI.A and OVI.B