Mccoy Global Inc. · TSX:MCB
Mccoy Global — Investor Presentation (June 2012)
38 slides from Mccoy Global's investor presentation, June 2012
Slide 1: Innovative Paths to Global Growth
INNOVATIVE PATHS TO GLOBAL GROWTH Investor Presentation June 2012
Slide 2: Forward Looking Information
Forward Looking Information This presentation contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect“, "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should",
Slide 3: Corporate Overview
Jim Rakievich, ICD.D President & Chief Executive Officer Milica Stolic, CMA Chief Financial Officer & Corporate Secretary Tom Watts Vice President, Human Resources ENERGY MOBILE PRODUCTS & SERVICES SOLUTIONS DRILLING & Jim Nowotny TRAILERS Andy McEachern, P.Eng. COMPLETIONS Senior Vice President, Vi
Slide 4: Market Summary
TSX: MCB Market Summary (as at June 15, 2012 unless noted) Share price $3.61 Shares outstanding ~26.5 million Options ~1.7 million (as at April 30, 2012) Market capitalization ~$96 million Daily Trading Volume 67,226 shares (as at April 30, 2012) Dividend $0.05/share/quarter (as at May 17, 2012) 5%
Slide 5: Dividend History
Dividend History McCoy Dividend Summary $0.20 $0.18 $0.18 Cumulative Amount of Dividends Paid/Year $0.16 Includes special $0.14 dividend of $0.04 $0.12 $0.12 $0.10 $0.10 $0.09 $0.08 $0.06 $0.04 $0.04 $0.03 $0.03 $0.02 $0.01 $- $- 2004 2005 2006 2007 2008 2009 2010 2011 2012E Year ⁄ Dividend paying c
Slide 6: 2011 Year in Review
2011 YEAR IN REVIEW ⁄ Continued financial strength ⁄ Focused on the global energy industry ⁄ Extended our global reach ⁄ Developed new products ⁄ Invested in organizational capacity McCoy Corporation
Slide 7: McCoy: Past, Present, Future
MCCOY PAST, PRESENT, FUTURE
Slide 8: McCoy 2008
McCoy 2008 ⁄ Diversified conglomerate strategy ⁄ Confusing brand ⁄ Explaining, not telling, our story ⁄ New product development funded < 1% of revenue ⁄ Heavy reliance on North American market (Western Canada) 2008 2012 2014 8
Slide 9: McCoy 2012
McCoy 2012 ⁄ Pure Play ⁄ 100% oil and gas market focused ⁄ Increased new product development funding to 4% of revenue ⁄ Rebranded McCoy ⁄ Expanded global reach ⁄ Continued financial strength 2008 2012 2014 9
Slide 10: Where Are We Going?
MCCOY WHERE ARE WE GOING?
Slide 11: McCoy 2014+
McCoy 2014 + ⁄ Market leading delivery model ⁄ Continuous introduction of new and innovative products ⁄ Global service & supply model / life cycle participation 2008 2011 2014 11
Slide 12: International Sales Growth
International Sales Growth ⁄ McCoy expanded its U.S. and international sales from 48% of total sales in 2008 to 56% in 2011 2008 Sales 2011 Sales 2014 Goal 30% 20% US 37% Canada 52% 44% US 35% Canada Canada US 18% 19% 45% Intl. International International 12
Slide 13: Growing Global Reach
Growing Global Reach McCoy locations Growing sales footprint Growth opportunities ⁄ Alberta ⁄ McCoy delivered products/sales ⁄ Middle East ⁄ British Columbia to 44 countries in 2011. ⁄ Asia ⁄ Texas ⁄ South America ⁄ Louisiana ⁄ Europe 13
Slide 14: Global Clients
~ {Transocean HALLIBURTON TESCO tn ODFJELL WELL SERVICES TRICAN WELL SERVICE 14
Slide 15: International Stability: Rig Counts
International Stability 2,000 Rig Counts (Average of the monthly consensus) 1,500 Global Rig Counts Canada US 1,000 International 500 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 McCoy’s focus on the global market reduces volatility Source: Baker Hughes. Rig counts shown are the average
Slide 16: Mobile Solutions
MOBILE SOLUTIONS McCoy Corporation
Slide 17: Record Breaking Year 2011
Record Breaking Year 2011 ⁄ McCoy experienced significant demand in 2011 in North America's pressure pumping market for custom trailer chassis ⁄ Brands include Peerless and Scona 17
Slide 18: Meeting Demand
Meeting Demand ⁄ Owned manufacturing plant in British Columbia, Canada ⁄ Three U.S. sub-contracting plants: two in Texas; one in Arkansas ⁄ Efficient way to add capacity during market peaks Penticton Plant U.S. sub- Peerless U.S. sub- Limited contractor contractor U.S. sub- contractor 18
Slide 19: Outlook 2012
Outlook 2012 ⁄ Sales volumes will remain high ⁄ Shift in product mix to U.S. heavy haul oil field market (lower margin products) 19
Slide 20: Energy Products & Services
ENERGY PRODUCTS & SERVICES McCoy Corporation
Slide 21: Drilling & Completions High Sale Products: Tongs & Bucking Units
Drilling & Completions High Sale Products: Tongs & Bucking Units 21 McCoy Corporation
Slide 22: Drilling & Completions (D&C) Service Support
Drilling & Completions (D&C) McCoy D&C Headquarters: Houston, TX New Product Manufacturing Development Service Support • Broussard, LA •Houston, TX • Houston, TX • Edmonton, AB •Broussard, LA • Broussard, LA • Future locations •Edmonton, AB • Edmonton, AB • Future locations Target customers: Service
Slide 23: Drilling & Completions Market Expectations
Drilling & Completions Market Expectations Source: Raymond James Source: Raymond James ⁄ More horizontal drilling, longer laterals, requiring more premium connections ⁄ Deeper, Higher Pressure/Temperature (HPHT) wells being drilled 23
Slide 24: Organic Growth – New Product Development (NPD)
Organic Growth – New Product Development (NPD) Project Commercialization 1 Torque Sub - weCATT Q3 2012 2 Iron Roughneck - weTORQ85 Q4 2012 3 Hydraulic Pipe Handler - weMOVE35 Q2 2013 4 Electric Bucking Unit - weBUCK Q2 2013 5 CRT Casing Running Tool - weRUN350 Q2 2013 6 Future projects TBD ⁄ Four pa
Slide 25: weCATT – Torque Sub
weCATT – Torque Sub ⁄ Monitors and measures torque, hook load and turns ⁄ Wirelessly transmits data to computer/laptop ⁄ Successfully completed field testing ⁄ Orders for weCATT very strong ⁄ Production to begin in July 2012 ⁄ Edmonton plant being outfitted for production 25
Slide 26: Coatings & Hydraulics
Coatings & Hydraulics ⁄ A coatings and hydraulic cylinder repair service company ⁄ Add value to a customer’s part; do not design and manufacture our own products ⁄ Divisions: ⁄ Hydraulics ⁄ PTA ⁄ Plating ⁄ Thermal Spray 26
Slide 27: Coatings & Hydraulics
Coatings & Hydraulics ⁄ Best quarter in four years ⁄ Market growth opportunities ⁄ Focused management team ⁄ Operational efficiencies ⁄ Quality improvements ⁄ 2012 trend to continue 27
Slide 28: Financial Performance
FINANCIAL PERFORMANCE McCoy Corporation
Slide 29: 2011 Annual Financial Results
2011 Annual Financial Results $ million, except noted 2010 2011 Change Total revenue 100.8 153.8 +53% Net earnings 5.4 11.9 +120% Net earnings per share 0.20 0.45 +125% EBITDAS 13.6 21.6 +59% EBITDAS per share 0.51 0.81 +59% EBITDAS percent of revenue 13% 14% +8% Cash flow from continuing operating
Slide 30: 2011 Annual Segmented Results
2011 Annual Segmented Results Twelve months ended Twelve months ended December 31, 2010 December 31, 2011 Mobile Solutions Mobile External Sales 32% EP&S Solutions EP&S 55% 45% 68% Earnings from Mobile continuing Mobile Solutions operations before Solutions 21% EP&S 35% corporate charges, 65% intere
Slide 31: First Quarter 2012 Financial Results
First Quarter 2012 Financial Results $ million, except noted Q1 2011 Q1 2012 Change Total revenue 32.9 45.5 +38% Net earnings 1.8 2.2 +22% Net earnings per share 0.07 0.08 +14% EBITDAS 4.0 4.6 +15% EBITDAS per share 0.15 0.17 +13% Cash on hand at period end 15.9 23.4 +47% Net cash position at period
Slide 32: First Quarter 2012 Segmented Results
First Quarter 2012 Segmented Results Three months ended Three months ended March 31, 2011 March 31, 2012 Mobile Mobile External Sales EP&S EP&S Solutions Solutions 56% 57% 44% 43% Mobile Earnings from Solutions continuing 14% operations before Mobile EP&S corporate charges, Solutions 53% EP&S intere
Slide 33: Investing in McCoy
INVESTING IN MCCOY ⁄ Long term market fundamentals are strong ⁄ Significant growth and earnings potential ⁄ Excellent management team with a proven track record ⁄ Strong balance sheet (Net cash $17.4 million) ⁄ Innovative technologies with barriers to entry ⁄ Growing global market presence ⁄ Increas
Slide 34: Contact details
Jim Rakievich, President & Chief Executive Officer Milica Stolic, Chief Financial Officer & Corporate Secretary Jim Nowotny, Senior Vice President, Drilling & Completions Head Office: Edmonton, Alberta, Canada (780) 453-8451 [email protected] www.mccoyglobal.com TSX:MCB 34
Slide 35: Additional Information
ADDITIONAL INFORMATION ⁄ Management Team ⁄ Board of Directors ⁄ Analyst Coverage
Slide 36: Executive Team
Executive Team Corporate Jim Rakievich, ICD.D President and Chief Executive Officer Milica Stolic, CMA Chief Financial Officer & Corporate Secretary Tom Watts VP, Human Resources Energy Products & Services Jim Nowotny, BSME Senior VP, Drilling & Completions Jane Debbrecht, B.Sc., MBA General Manager
Slide 37: Board of Directors
Board of Directors Chairperson Kerry Brown, CA President and CEO of CMW Management Inc. Frank Burdzy, MBA President and CEO of Champion Petfoods Terry Chalupa President and CEO of Abalone Construction Terry Freeman, FCA, ICD.D Managing Director of Northern Plains Capital Ltd. John Howard, CA Managin
Slide 38: Analyst Coverage
Analyst Coverage Paradigm Capital John Bereznicki, CFA Calgary, Alberta Ben Cherniavsky & Raymond James Steve Hansen Vancouver, British Columbia Cormark Securities Sarah Hughes, CFA Toronto, Ontario GMP Securities L.P. Justin Wu, CFA Toronto, Ontario 38