Corporate Presentation June 2016 TSXV: CFL 1
Forward Looking Statements or expectations upon which they are based will Certain information with respect to Canadian The Company cannot can guarantee future results, Equipment Rentals Corp (the “Company”) in this occur. By its nature, forward-looking information levels of activity, performance or achievements. involves numerous assumptions, known and presentation herein contain certain forward-looking Consequently, there is no representation by the unknown risks and uncertainties, both general and statements and forward looking information which Company that actual results achieved will be the same are based upon the Company’s current internal specific, that contribute to the possibility that the in whole or in part as those set out in the forward- predictions, forecasts, projections and other forward expectations, estimates, projections, assumptions looking statements and information. Some of the risks and beliefs. In some cases, words such as “plan”, looking statements will not occur. Forward-looking and other factors, some of which are beyond the “expect”, “project”, “intend”, “believe”, “anticipate”, statements and information in this presentation Company’s control, which could cause results to differ “estimate”, “may”, “will”, “potential”, “proposed” and herein include, but are not limited to, statements materially from those expressed in the forward-looking with respect to: other similar words, or statements that certain statements and information contained in this events or conditions “may” or “will” occur, are presentation herein include, but are not limited to: • results of various projects of the Company; • intended to identify forward-looking statements and general economic conditions in Canada, the United • growth expectations within the Company; forward-looking information. These statements are States and globally; • the performance and characteristics of the • not guarantees of future performance and involve failure to realize anticipated benefits of acquisitions; Company’s rental fleet; • known and unknown risks, uncertainties and other stock market volatility and market valuations; • capital expenditure programs; • factors that may cause actual results or events to competition for, among other things, capital and • realization of the anticipated benefits of differ materially from those anticipated in the skilled personnel; acquisitions and dispositions; and • forward-looking statements or information. In the availability of capital on acceptable terms; and • pro forma estimates for 2015 based on analyst • addition, this presentation may contain forward- the need to obtain required approvals from consensus. looking statements and information attributed to regulatory authorities; third party industry sources. Undue reliance should Although the Company believes that the Readers are cautioned that the foregoing list of factors not be placed on these forward-looking statements, expectations reflected in the forward-looking is not exhaustive . as there can be no assurance that the plans, statements are reasonable, there can be no intentions assurance that such expectations will prove to be P.O Box 1326 correct. Vernon, BC, V1T 6N6 2
TTM Mar 31, 2016 (1)(2) Energy Services TTM Mar 31, 2016 (1) General Rentals TTM Mar 31, 2016 (1) Waste Management (1) Division profit shown here does not include $4.6 mm in unallocated corporate fees 3 (2) Profit is net of depreciation
Corporate Strategy ORGANIC GROWTH COMPLEMENTARY ACQUISITIONS • • Leverage existing equipment portfolio into Two accretive acquisitions in 2016 • Industrial market segment Balanced cash and shares • • Continue to update equipment fleet with the Target - high margin / low head count next generation of technology – solar offerings RENTALS LANDSCAPE OIL AND GAS DRILLING INDUSTRIAL GENERAL RENTALS LEVERAGE EXISTING PRODUCT OFFERING TO NEW MARKET • Generators • Accommodations • Heaters • Light Towers • Surface Rentals • Generators • Bins • Power Generation • Compaction • Other Equipment • Down Hole Equipment • Other Equipment STRATEGIC GROWTH OPPORTUNITY 4
Financial Snapshot As at June 15 , 2016 CFL Financial Highlights Trading Symbol TSX-V 41.1 mm Shares outstanding (Basic) P/TBV 0.4x $0.47 TBV/Shr $1.28 Share price $2.15 / $0.34 52 week high / low 48,916 Insider Ownership Volume (30 day avg.) $19.3 mm 20% Market Capitalization Artie Kos $50.4 mm Net Debt (Mar 31/16) (1) $69.7 mm Enterprise value (EV) (1) Net debt is calculated as bank debt + interest bearing obligations – unrestricted cash 5
Energy Services Division Zedcor Energy Services is a leading supplier of oilfield rental equipment and modular accommodation to the Alberta, British Columbia, and Saskatchewan oil and gas, forestry and mining industries. OILFIELD RENTALS COMPETITORS • Accommodations • Black Diamond • Down Hole Equipment • Enterprise • Surface Rentals • Western One • Power Generation • Strad • Essential Customers 6
Energy Services Overview Accommodations Downhole Equipment Surface Rentals Specialty pipe Modern, diverse rental fleet Modular accommodations Generators Heavy weight drill pipe Integrated Wellsite System (IWS) 400 bbl. Tanks Drill pipe Dedicated Geo labs (DGL) Floc Tanks Drill collars Command Centre Full complement of equipment Related handling equipment Engineer / Engineer . Accommodations $64M / 58% $ 110M Surface Rentals $39M / 34% Replacement Value Downhole Equipment $7M / 8% 7
Putting it Together Pipe Racks Flock Tanks Shale Tanks Drill Pipe Heavy Weight Drill Pipe 400 bbl Tanks Generators Wellsite Accommodations 8
General Rentals Division Growth Opportunities Equipment • Organically grown since 1998 • Heaters • Realize synergies with energy • Generators service and industrial clients • Compaction • Plant & Pipeline construction • Other Equipment continues to be strong despite low commodity prices Competitors • Hertz • United Rentals • Sun Belt OUR CLIENTS 9
General Rentals Equipment to Facilitate Commercial Construction Projects 400 PLUS ACTIVE CUSTOMERS 85% REPEAT CUSTOMERS ECONOMIC GROWTH IN ALBERTA Major construction contractors Top 10 customers Alberta TTM building permits up 18%* Home builders 1/3 revenue Est. 2% population growth through 2038 Government and infrastructure Average relationship 14 yrs. * Alberta Finance and Enterprise 35K sq. ft. facility on 6 Acres Heaters 20% Generators 16% Compaction 10% Other 45% Compressors 9% 10 10
Waste Management Division Landfills 7 REGIONAL FACILITIES AB • Cities 5 Government Rose Ridge • 2 Government transfer stations Drayton Valley • Long term contracts Edmonton Leduc COMMERCIAL WASTE COLLECTION Hinton Aspen • Roll-off bin and collections services Camrose GROWTH OPPORTUNITIES Calgary • Provide additional services for existing facilities • Expand sales team to drive contaminated soils to landfills • Expand collection services into industrial and oilfield markets 11
Financial Performance $58 $60 REVENUE EBITDA $47 $50 $46 $40 ($MM) $34 $27 $30 $19 $20 $15 $13 $10 $8 $8 $10 $5 $0 2010 2011 2012 2013 2014 2015 12
Balance Sheet $35 3.5 Net Debt Net Debt/ EBITDA Dec 31, Dec 31, 30.5 2015 2014 Liabilities 29 $30 3 24 $25 2.5 $8,514 $10,060 Net Debt (1) Working capital / EBITDA (2) $20 2 15 $15 1.5 $30.5 $29.5 Long-term debt (MM) 12 9 $10 1 $5 0.5 $0 0 2010 2011 2012 2013 2014 2015 (1) bank debt + financial leases (2) Adjusted EBITDA plus stock based comp, acquisition expenses + non recurring expenses 13
Management and Board of Directors Directors Joined Management Joined Artie T. Kos Artie T. Kos Chairman and Chief Executive Chairman and Chief 2015 2015 Officer. Executive Officer Chairman and CEO Chairman and CEO J. Blair Goertzen President and CEO of Austin Fraser Former President of 2014 2014 Enerflex Ltd. Winalta Inc. Director President 23 years of experience with Bill Guinan Ken Olson 2005 Partner of BLG LLP 2016 both private and publicly- Director CFO traded companies 15 years of direct experience David Maplethorpe Todd Ziniuk 2011 Former CEO of MCL 2016 in the oilfield rentals and Director Acting COO logistics industry Brad R. Munro President and CEO of 2014 Bittercreek Capital Corp. Director Ken Stephens Former CFO of CERF 2005 Incorporated (Retired) Director 14
Why Canadian Equipment Rentals Corp. Compelling organic growth opportunity in Alberta’s diversified energy services, general rentals, and waste management sectors Disciplined acquisition strategy Diversification through full equipment rental spectrum. History of returning excess cash flow to shareholders through reasonable dividend 15
Contact Us Austin Fraser, Ken Olson President Chief Financial Officer (780) 410-2998 (780) 410-2998 afraser@cerfcorp.com kolson@cerfcorp.com TSX-V: CFL
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