April 2012 Corporate Presentation Don Caron, Chief Executive Officer Jason Theiss, Chief Financial Officer TSX: BRY www.brichem.com
Forward-Looking Statement TSX: BRY April 2012 Certain statements set forth in this presentation are forward looking statements. Although Bri-Chem Corp. management believe their expectations are based on reasonable assumptions, they give no assurance that expected results will be achieved. There are numerous risks and uncertainties that can effect the outcome and timing of such events, including many factors beyond the control of Bri-Chem Corp.’s management. These factors include, but are not limited to, economic and political conditions, government regulation, commodity prices for oil and gas, steel commodity prices, fluctuations in the level of oil and gas, the need to effectively integrate acquired businesses, uncertainties as to Bri-Chem’s ability to implement its business strategy effectively in Canada and the United States, Bri-Chem’s ability to attract and retain key personnel, currency fluctuations and other factors that affect demand for the Company’s product. Should one or more of these risks or uncertainties occur, or should underlying assumptions prove incorrect, the actual results and plans for fiscal 2012 and beyond could differ materially from those expressed in the forward looking statements. Additional information on these and other factors and uncertainties are described under the heading “Risk Factors” in the Company’s most recent Annual Information Form (“AIF”) and other continuous disclosure materials filed by the Company with Canadian securities regulators, which are available to the public at www.sedar.com. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date it is expressed. The Company does not undertake to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law. Furthermore, certain measures we use are not recognized measures under International Financial Reporting Standards (“IFRS”). Specific measures used are earnings before interest, taxes, depreciation, amortization and non-cash stock based compensation (“EBITDA”). We strongly recommend the participants review the discussion of these statements in the “Management’s Discussion and Analysis – Non-IFRS Measures and Reconciliations” section of our 2011 Annual Report. 2
Company Overview TSX: BRY April 2012 Business Divisions: � Drilling Fluids � Distribution – 350 Products � Proprietary Blending & Packaging � Steel Pipe � Distribution – Seamless Pipe � Manufacturing – Large Diameter � Industry: � Oil and Gas � Geographic markets: � Canada � USA 3
Company Highlights TSX: BRY April 2012 Record Achievements: 2011 Milestones: � 2011 Revenues: $186M � Platform Acquisition in USA � 2011 EBITDA: $16.4M � Graduated to the TSE � 2011 Earnings: $ 9.5M � 25+ Years in Business � 2011 EPS: $0.61 � New $80M ABL � Manufacturing Facility in � 5 Year Revenue Growth Production � 2007 - $60M � 2011 - $186M 4 4
Market Data TSX: BRY April 2012 As of April 16, 2012 Exchange Toronto Stock Exchange Shareholder Breakdown Shares Outstanding 17.2M/FD18.0M Share Price $3.05 Management 52 Week High/Low $4.42/$2.20 Directors Retail and Insiders 42% Market Capitalization $52.6 million 38% P/E (1) 5.0 X EBITDA (1) $16.4M Institutional 20% EV/EBITDA (1) 4.8 X Earnings per FD share (1) $0.61 EBITDA per FD share (1) $1.00 Book Value per FD share (1) $2.55 (1) For the year ended December 31, 2011 5
Drilling Fluids - Market TSX: BRY April 2012 Trend Wholesale Oilfield Chemical Demand (est. $1.0B CAN, USA $9.1B) North America continues to drill deeper and longer reach horizontal wells which are completed utilizing multi-stage fracturing which consumes more: Drilling Fluids � Liquid Mud � Cementing Additives � Acidizing Additives � Frac Chemicals � Canada � Estimated at $1.0B (1) � Largest Independent Supplier of Drilling Fluids in Canada � Targeting Stimulation Fluids Segment USA Estimated at $9.1B (1) � Currently focused on Drilling Fluids Segment � No Dominate National Independent Supplier (1) Company Estimate � 6
Drilling Fluids - Canada TSX: BRY April 2012 Distribution 2011 Canadian Drilling Fluids Revenue $152 million � >50% market share – drilling fluids segment (1) � 27% YOY Increase in sales Blending � <10% market share – stimulation $ (000’s) fluids segment (1) � 39% YOY increase in sales Key Customers -29% � -26% � - 2% � Year Drilling Fluids Blend/Pack (1) Company Estimate 7
Distribution Network - Canada TSX: BRY April 2012 Distribution Warehouses 1 - High Level, AB 2 - Grande Prairie, AB 3 - Slave Lake, AB 9 4 – Edson, AB 5 - Blackfalds, AB 6 - Consort, AB 1 10 7 - Brooks, AB 8 - Lloydminster, AB 9 - Fort Nelson, BC 10 - Fort St. John, BC 2 11 - Swift Current, SK 12 - Estevan, SK 3 Blending & Sales 13 - Acheson, AB 4 (Blending & Distribution) 13 14 8 14 - Camrose, AB (Packaging & Distribution) 5 15 - Calgary, AB 6 (Sales office) 15 Legend 7 Strategic Stock Point 11 Office / Blending & Warehouse 12 8
Drilling Fluids - USA TSX: BRY April 2012 Acquisition: 2011 USA Drilling Fluids � Completed Stryker acquisition May 2011 Revenue $6.0 million � Acquired sales of $6.5M 1,400,000 � Denver, CO Head Office 1,200,000 Distribution: 1,000,000 � Bri-Chem aggressively expanding: 800,000 � 3 to 9 Warehouses $ 600,000 � 6 to 10 Trucks � 1 to 4 National sales 400,000 � Additional Warehouse expansion plans 200,000 � Establish liquid mud blending facility - Opportunity: � Capture a >10% of $3.4B Drillings Fluids Market Month � Establish the dominate independent drilling Supply Trans fluids distribution network for the USA 9
Distribution Network - USA TSX: BRY April 2012 Warehouses 1 – Denver, CO 2 – Ulster, PA 3 – Leetsdale, PA 4 – Grande Junction, CO 5 – Alice, TX 6 – Tyler, TX 7 – Casper, WY 8 – Myton, UT 9 - Bakersfield, CA Proposed 1 – North Dakota 2 – Oklahoma 3 – Oklahoma Legend Current Strategic Stock Point Proposed Stock Point 10
Steel Pipe - Distribution TSX: BRY April 2012 2011 Steel Pipe Distribution � Wholesale distributor of steel pipe for the Revenue $27 million energy industry � Pipe size ranging from ½ to 36 inch: 35,000 30,000 � Gas Line pipe 25,000 � Fluid Transmission pipe Millions of $ 20,000 � Shifted YOY Product Mix: 15,000 � Lower Inventory 10,000 � Increased Margins (2010 – 7.6% 2011 - 19%) � Higher Inventory Turns 5,000 � Distributor of Large Diameter - 2008 2009 2010 2011 � Source Steel Pipe from: Year � North America � Asia � India � Vietnam � Master Distributors: 11
Steel Pipe - Manufacturing TSX: BRY April 2012 Large Diameter Seamless Pipe Production 14” – 36” TPE Process Exclusive to North America QA/CDA 2011 Capital Investment $6M Completion of commissioning phase Q1 2012 2012 Estimated Production Ramp-up (1) Q1 – 1000MT Q2 – 2000MT Q3 – 3500MT Q4 – 4500MT Average Market Selling Price (1) $2K per MT Target Market Energy Fluid and Gas Line Pipe Estimated Production at Full Capacity (1) 24K – 30K MT (1) Company Estimate 12
2012 Sales Drivers TSX: BRY April 2012 Canada 2012 Wells Drilled Forecast (1) 13,350 up 3% 2012 Average Active Rig Forecast (2) 407 up 1% 2012 Current Rigs Operating – Early spring breakup (2) 187 USA 2012 Wells Drilled Forecast 47,918 up 6.7% 2012 Average Active Rig Forecast (4) 2,019 up 7.6% 2012 Current Rigs Operating (3) 1,979 North America Oil and Gas Prices Approved Exploration Expenditures (1) PSAC Forecast as of January 26, 2012 (2) CAODC Forecast as of November 8, 2011 (3) Baker Hughes as of April 5, 2012 (4) World Oil Report as of February 2012 13
2011 Highlights TSX: BRY April 2012 2011 Record Highlights: Revenue EBITDA 70,000 7,000 � Revenues $185.7M – 22% YOY increase 60,000 6,000 � EBITDA $16.4M – 29% YOY increase 50,000 5,000 Revenue (Millions of $) EBITDA (Millions of $) � EBITDA per share $1.00 ($0.91 - 2010) 40,000 4,000 � Earnings $9.5M – 33% YOY increase 30,000 3,000 � EPS of $0.61 ($0.51 - 2010) 20,000 2,000 10,000 1,000 - - 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q 11 14
5 Year Financial Performance TSX: BRY April 2012 $18,000 $200,000 2011 EBITDA to Sales – 8.9% $180,000 $16,000 $160,000 EBITDA& Earnings (000’s) $14,000 EBITDA Per share – $1.00 $140,000 $12,000 Revenue(000's) $120,000 $10,000 $100,000 $8,000 $80,000 $6,000 $60,000 $4,000 $40,000 $2,000 $20,000 $0 $0 2007 2008 2009 2010 2011 EBITDA Revenue Year Ended 2007 2008 2009 (1) 2010 2011 Revenue $ 59,519 $ 111,283 $ 96,480 $ 152,495 $185,723 EBITDA 5,668 10,012 3,744 12,712 16,441 (1) Normalized earnings and EPS for 2009 15
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