CARBO Ceramics — Shareholder Meeting (April 2008)
18 slides from CARBO Ceramics's shareholder meeting presentation, Apr 15, 2008
Slide 1: Annual Meeting – April 15, 2008
Annual Meeting – April 15, 2008 Gary Kolstad Chief Executive Officer CARBO is the world’s largest supplier of ceramic proppant, the world’s leading provider of fracture diagnostics technology and the provider of the world’s most popular fracture simulation software.
Slide 2: Improved Production & Recovery
Improved Production & Recovery Frac Design & Modeling • FracproPT Frac Conductivity • Ceramic Proppant Frac Diagnostics • Surface Tilt • DownholeTilt • Microseismic • Hybrid – Tilt & Microseismic Reservoir Monitoring • Tilt • Passive Seismic • Precision GPS • InSAR Consulting Services • Wellsite Eng
Slide 3: Everyday Operations and Market Reach
Everyday 3.0 million lbs of our ceramics are pumped on frac jobs We execute ~ 70% of all frac mapping jobs Our FracproPT software is used on ~ 40% of the world’s frac designs We monitor oil & gas reservoirs, mines, dams, bridges, and other civil projects throughout the world Tiltmeters, passive seis
Slide 4: Revenue and Margins
CARBO Revenue and Margins $0 $50 $100 $150 $200 $250 $300 $350 2000 2001 2002 2003 2004 2005 2006 2007 0 5 10 15 20 25 30 35 Revenue Operating Margin % Rev $M %
Slide 5: Sustaining Future Growth
CARBO Sustaining Future Growth • Be in high value business segments and go where the activity is in the world • Maintain leadership in market share position • Maintain leadership in people, technology, quality, and innovation
Slide 6: Slide 6
Slide 7: The Frac Market Keeps Growing Worldwide
CARBO The Frac Market Keeps Growing Worldwide Source: Spears & Associates estimates 9.8 13.2 18.0 19.9 21.2 $5 $10 $15 $20 $25 2004 2005 2006 2007 2008 The Growing Frac Market Est Market Size ($ Bln) • The frac market continues to be one of the largest and fastest growing segments in the oilfield •
Slide 8: Worldwide Revenue & Drilling Activity
CARBO Worldwide Revenue & Drilling Activity $0 $50 $100 $150 $200 $250 $300 $350 $400 2000 2001 2002 2003 2004 2005 2006 2007 Q1-08 0 300 600 900 1,200 1,500 1,800 2,100 2,400 Other Intl Canada U.S. Int’l Rig Count Canada Rig Count U.S. Rig Count Rev $M Drilling Rigs Source: Baker Hughes Rigcount
Slide 9: Sustaining Future Growth
CARBO Sustaining Future Growth • Be in the high value business segments and go where the activity is • Maintain leadership in market position • Maintain leadership in people, technology, quality, and innovation
Slide 10: Global Market Leadership
CARBO Global Market Leadership 34% 28% 16% 11% 11% CARBO Russian Suppliers Saint Gobain Curimbaba Others Worldwide data — Source: Company estimates and PropTesters, Inc. 2007 Proppant Market Study Ceramic Market Share – 2007 2.65 Bln Lb Market Pinnacle Services – Market Position • Frac Design. Fracp
Slide 11: CARBO Proppant Sales 1979-2007
CARBO CARBO Proppant Sales 1979-2007 Lbs (M) 0 200 400 600 800 1,000 1,200 79 808182 8384 85 86 878889 909192 93 94 9596 979899 ‘00’01’02’03’04’05’06’07’08 CAGR – 19% 7.9 Billion Lbs and Counting...
Slide 12: Sustaining Future Growth
CARBO Sustaining Future Growth • Be in the high value business segments and go where the activity is • Maintain leadership in market position • Maintain leadership in people, technology, quality, and innovation
Slide 13: CARBO People and Places
CARBO CARBO People and Places 17 Nationalities Represented Product/Services Sold in 49 Countries Canadian American Ecuadorean Jamaican Venezuelan Russian Chinese Japanese Korean Indonesian Algerian British Dutch French German Iranian Indian
Slide 14: Broadest Mapping and Reservoir Monitoring Technologies in the Industry
Deformation – Movement • Tilt (Surface and Downhole) • GPS • InSAR Acoustic • Passive Micro Seismic Fiber Optics • Temperature Interpretation • Engineers and Geoscientist • Experience • Integrated Approach Broadest Mapping and Reservoir Monitoring Technologies in the Industry
Slide 15: Broadest Product Line – Best Economic Conductivity
CARBO CARBOECONOPROP CARBOHYDROPROP CARBOLITE CARBOPROP CARBOHSP Shallow Deep Well Depths New lightweight ceramic proppant developed for the growing slickwater fracturing market Economic lightweight ceramic proppant for use in shallower wells The highest conductivity ceramic proppant to 10,500 psi s
Slide 16: Economic Conductivity — The Value Ladder
CARBO Economic Conductivity — The Value Ladder Cost per Ft3 In the Frac Strength Conductivity CARBOECONOPROP CARBOHYDROPROP CARBOLITE CARBOPROP CARBOHSP Shallow Deep Well Depths Less More Proppant Cost per FT3 Lightweights – CRR Only • 17%+ more volume per Lb than Heavyweights • 83 Lbs EP = 100 Lbs
Slide 17: Product and Service Innovation
CARBO Product and Service Innovation • CARBOHYDROPROP • New lightweight ceramic proppant focused on the market for the growing slickwater fracturing market • Provides an economically attractive alternative to resin coated sand, with much higher conductivity • 40-80 mesh for transportability and ease
Slide 18: Summary
CARBO Summary • Our businesses provide value worldwide, to a fast growing industry segment – fracturing • We have market share leadership in all of our business segments • We have technology leadership that is based on improving well production and increasing the ultimate oil & gas recovery • Our fi