Attached files
| file | filename |
|---|---|
| 8-K - 8-K - PIONEER ENERGY SERVICES CORP | a8kinvpres3-27x18.htm |
ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
SCOTIA HOWARD WEIL 2018 ENERGY CONFERENCE
March 27th, 2018
ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
Forward-looking Statements
This presentation contains various forward-looking statements and information that are based on management’s current expectations and assumptions about
future events. Forward-looking statements are generally accompanied by words such as “estimate,” “project,” “predict,” “expect,” “anticipate,” “plan,”
“intend,” “seek,” “will,” “should,” “goal” and other words that convey the uncertainty of future events and outcomes. Forward-looking information includes,
among other matters, statements regarding the Company’s anticipated performance, quality of assets, rig utilization rate, capital spending by oil and gas
companies, and the Company's international operations.
Although the Company believes that the expectations and assumptions reflected in such forward-looking statements are reasonable, it can give no assurance
that such expectations and assumptions will prove to have been correct. Such statements are subject to certain risks, uncertainties and assumptions, including
general economic and business conditions and industry trends, levels and volatility of oil and gas prices, the continued demand for drilling services or
production services in the geographic areas where we operate, decisions about exploration and development projects to be made by oil and gas exploration
and production companies, the highly competitive nature of our business, technological advancements and trends in our industry and improvements in our
competitors’ equipment, the loss of one or more of our major clients or a decrease in their demand for our services, future compliance with covenants under
debt agreements, including our senior secured revolving asset-based credit facility, our term loan and our senior notes, operating hazards inherent in our
operations, the supply of marketable drilling rigs, well servicing rigs, coiled tubing and wireline units within the industry, the continued availability of new
components for drilling rigs, well servicing rigs, coiled tubing units and wireline units, the continued availability of qualified personnel, the success or failure of
our acquisition strategy, including our ability to finance acquisitions, manage growth and effectively integrate acquisitions, the political, economic, regulatory
and other uncertainties encountered by our operations, and changes in, or our failure or inability to comply with, governmental regulations, including those
relating to the environment.
Should one or more of these risks, contingencies or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary
materially from those expected. Many of these factors have been discussed in more detail in the Company's annual report on Form 10-K for the fiscal year
ended December 31, 2016. Other unpredictable or unknown factors that the Company has not discussed in this presentation or in its filings with the Securities
and Exchange Commission could also have material adverse effects on actual results of matters that are the subject of the forward-looking statements. All
forward-looking statements speak only as the date on which they are made and the Company undertakes no duty to update or revise any forward-looking
statements. We advise investors to use caution and common sense when considering our forward-looking statements.
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ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
Pioneer Energy Services – Diversified Services
% of TTM REVENUE
(1) TTM revenue as of December 31, 2017
(2) Market Capitalization and Enterprise Value as of March 21, 2018; Enterprise value based on net debt
DRILLING SERVICES
Drilling Services - US 16 Rigs
Drilling Services – Colombia 8 Rigs
Total Drilling 24 Rigs
PRODUCTION SERVICES
Well Servicing 125 Rigs
Wireline 108 Units
Coiled Tubing 14 Units
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TTM REVENUE1: $447 MILLION
MARKET CAPITALIZATION2: $253 MILLION
ENTERPRISE VALUE2: $639 MILLION
SERVICE LINES: LAND DRILLING, WELL SERVICING,
WIRELINE, COILED TUBING
EMPLOYEES: 2,300
COMPANY OVERVIEW
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Premium Shale-Oriented Assets
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US DRILLING SERVICES PRODUCTION SERVICES
• 100% pad-capable AC rigs
• Framework of a super-spec rig:
• 7,500psi mud systems
• Integrated top drives
• Rapid rig moves
• Greater racking capacity
• Ability to walk over wellheads
• Ability to run four engines and three mud pumps
• Premium shale-capable equipment
• High horsepower and tall-masted well
servicing rigs capable of servicing
laterals of any length
• Emphasis on large-diameter coiled
tubing services
• Completion-weighted services (56%)
ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
Balanced Revenue Mix Between Completion and
Remedial Services
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COILED TUBING WIRELINE WELL SERVICES
PRODUCTION SERVICES TOTAL
Note: Based on Q4 2017
ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
Established Customer Base with Premier Customers
KEY CUSTOMERS
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• Long-standing, high quality client relationships with a diverse group of large independent oil and gas
exploration and production companies
ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
Industry-Leading Safety
• For many years, Pioneer has been a leader in safety. Our commitment to industry-leading
safety helps us retain high-quality employees, broaden our client base, and reduce
operating costs.
• 2017 Total Recordable Incident Rate less than 1.0.
0
1
2
3
4
2011 2012 2013 2014 2015 2016 2017
PES - US IADC & AESC- without PES
Total Recordable Incident Rate
(injuries per 200,000 man-hours)
7
Source: IADC/AESC
Production Services
(Annual AESC Safety Awards)
2016
1st place – Coiled Tubing (Division IV)
3rd place – Wireline (Division IV)
2015
1st place – Wireline (Division IV)
3rd place – Well Servicing (Division IV)
2014
2nd place – Well Servicing (Division V)
2013
1st place – Well Servicing (Division V)
ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
PRODUCTION
SERVICES
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Well Servicing
• Of the top-tier well servicing providers, Pioneer
has the:
• Highest average hourly rate
• Highest average horsepower fleet with all
125 rigs either 550hp or 600hp
• Highest percentage of taller mast rigs with
all masts either 104’, 112’, 116’, or 121’ in
height
• 100% of rigs are capable of working in the
unconventional plays
• Established in the Bakken, Eagle Ford,
Fayetteville, Permian, Niobrara and along the
Texas/Louisiana Gulf Coast
• Average age of 6.5 years, including 36 built in
last 3 years
SERVICE OVERVIEW OPERATING LOCATIONS – 125 RIGS
REVENUE PER RIG HOUR¹
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(1) Based on company filings for Q4 2017
$518
$454
$394
$339
PES RNGR KEG BAS
ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
Wireline
• One of the most active U.S. wireline companies and
estimated to be the 6th largest wireline company in
the world.¹
• Majority of revenue derived from cased-hole
operations that include perforating, logging, and
pipe recovery
• Established in the Bakken, Eagle Ford, Niobrara,
Mid-Continent, Permian, and onshore/offshore
Louisiana
(1) QYResearch; Global Wireline Services Market; Sep 2017
(2) Based on Q4 2017 revenue
SERVICE OVERVIEW OPERATING LOCATIONS – 108 UNITS
DIVERSIFIED SERVICE OFFERINGS2
10
Open/Cased
Hole Logging
Mechanical
Services
Perforating
ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
Coiled Tubing
• Fleet currently provides an array of services with
coil capabilities ranging from 1 1/4” to 2 5/8” coiled
tubing.
• Established in the Eagle Ford, Rockies and
onshore/offshore Louisiana
• New 2 3/8” coil units to begin operations in Q3
2018 and Q1 2019
SERVICE OVERVIEW OPERATING LOCATIONS
UNIT COUNT1: 14 COIL UNITS
(1) Coil unit size is based on most common configuration; all units are capable of
running 2” and <2” coil
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1
2
3
4 4
2 5/8" 2 3/8" 2" < 2" Onshore < 2" Offshore
* Scheduled 2 3/8” unit deliveries in May 2018 and January 2019
ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
DRILLING
SERVICES
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ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
Drilling Services
Q4 2017 U.S. AVERAGE DRILLING MARGIN PER DAY OPERATING LOCATIONS
TOTAL RIG FLEET UTILIZATION1
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(1) Red indicates active rigs; one additional rig in Colombia will begin
work in early Q2 2018.
Note: all data from Company public filings
7
1 2
6 6
7
1
2
8
6
$4,000
$5,000
$6,000
$7,000
$8,000
$9,000
$10,000
PES HP PTEN PDS NBR ICD
ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
• Rig Move Average:
• 2 calendar days from release to acceptance
• 32 miles average mobilization
• Highest average margin per day of public land drillers (Q4 2017)
Drilling Services
14
TOP PERFORMER
• 1,500 HP Drawworks
• 24,500 ft 5” Racking Capacity
• 7,500 psi Mud System
• Two 2,000 HP Mud Pumps
• Ready for 3rd Mud Pump (if needed)
• Three Cat 3512C Engine Gensets
• Ready for 4th Engine Genset (if needed)
• Omnidirectional Walking System with full setback
RIG SPECIFICATIONS
ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
Drilling Services
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• NOV Amphion Integrated Control System
• Structure/Tool Management System
• 4 Channel Auto Driller
• Twister
• Modular Scalable System
• MD Totco RigSense Ready – Expanded Data Acquisition
and Information Management System
• NOV SoftSpeed II Option – Stick Slip Mitigation
• NOV NOVOS Option:
• Single Rig Optimization
• Remote Auto Driller Management
• Slip to Slip Process Automation
• Wired Drill Pipe Compatibility
• TrueDrill: Auto Driller that utilizes downhole
• DrillShark: Automated Dynamic MSE
Optimization
• Field Optimization
• Automatically distributes learnings to other
Amphion Systems for field optimization
NOVOS
ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
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ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
Balance Sheet and Cash Flow Management
• Completed $175 million senior secured term loan and $75 million asset-based lending
facility in November 2017. Proceeds were used, among other things, to retire the
outstanding balance of $101.7 million on the previous revolving credit facility scheduled
to mature in 2019.
• Based on current outlook for activity and an estimated $55 million capital expenditure
budget in 2018, we expect to generate positive cash flow for the full-year 2018.
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ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
Historical Financial Results
REVENUE / ADJUSTED EBITDA ($ millions) CAPEX SPEND ($ millions)
Note: All data points reflect calendar year and trailing twelve months information derived from 10-K and 10-Q filings.
Please refer to Reconciliation of Net Income to Adjusted EBITDA
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ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
Liquidity and Capital Structure
December 31st, 2017
($ millions) Actual
Cash and cash equivalents $ 73.6
Restricted Cash 2.0
$75mm Asset-Based Lending Facility due 2022 --
Senior Secured Term Loan due 2022 175.0
6.125% Senior Unsecured Notes due 2022 300.0
Other1 (13.3)
Total Debt $ 461.7
Shareholders' Equity 210.1
Total Capitalization $ 671.8
Total Liquidity2 128.7
(1) Unamortized debt issuance costs and original issue discount
(2) Cash plus availability under asset-based lending facility net letters of credit
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ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx
Reconciliation of Net Income to Adjusted EBITDA
Adjusted EBITDA represents income (loss) before interest expense, income tax (expense) benefit, depreciation and amortization, loss on extinguishment of
debt, impairments, and the Colombian Net Equity Tax. Adjusted EBITDA is a non-GAAP measure that our management uses to facilitate period-to-period
comparisons of our core operating performance and to evaluate our long-term financial performance against that of our peers. We believe that this measure is
useful to investors and analysts in allowing for greater transparency of our core operating performance and makes it easier to compare our results with those
of other companies within our industry. Adjusted EBITDA should not be considered (a) in isolation of, or as a substitute for, net income (loss), (b) as an
indication of cash flows from operating activities or (c) as a measure of liquidity. In addition, Adjusted EBITDA does not represent funds available for
discretionary use. Adjusted EBITDA may not be comparable to other similarly titled measures reported by other companies. A reconciliation of net income (loss)
as reported to Adjusted EBITDA is included in the tables below:
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($ in millions) 2013 2014 2015 2016 2017
Net Income (Loss) (35.9) (38.0) (155.1) (128.4) (75.1)
Depreciation & Amortization 187.9 183.4 150.9 114.3 98.8
Net Interest 48.3 38.8 21.2 25.9 27.0
Loss on Extinguishment of Debt - 31.2 2.2 0.3 1.5
Impairment Expense 54.3 73.0 129.2 12.8 1.9
Income Tax Expense (Benefit) (19.8) (11.3) (37.6) (10.7) (4.2)
Adjusted EBITDA 234.7 277.1 110.8 14.2 49.9
($ in millions)
Q1
2017
Q2
2017
Q3
2017
Q4
2017 TTM
N t Inco e (Lo s) (25.1) (20.2) (17.2) (12.6) (75.1)
Depr ciation & Amortization 25.0 24.7 24.6 24.4 98.8
Net Interest 6.1 6.4 6.6 7.9 27.0
Impairment Expense - 0.8 - 1.1 1.9
Loss on Extinguishment of Debt - - - 1.5 1.5
Income Tax Expense (Benefit) 0.0 1.1 0.0 (5.4) (4.2)
Adjusted EBITDA 6.0 12.9 14.0 17.0 49.9
Year-Ending December 31,
ibdroot\Projects\IBD-NY\thaw2016\595552_1\06. Road Show\PES Company Presentation GS EQUITY v02.pptx