INVESTOR PRESENTATION November 2019 FORWARD LOOKING STATEMENTS - PowerPoint PPT Presentation

INVESTOR PRESENTATION November 2019

FORWARD LOOKING STATEMENTS This document contains statements that constitute forward-looking statements within the meaning of applicable securities legislation. These forward-looking statements include, among others, the Company’s prospects, expected revenues, expenses, profits, expected developments and strategies for its operations, and other expectations, beliefs, plans, goals, objectives, assumptions, information and statements about possible future events, conditions, results of operations or performance. These forward-looking statements are identified by their use of terms and phrases such as “anticipate,” “achieve”, “achievable,” “believe,” “estimate,” “expect,” “intend”, “plan”, “planned”, and other similar terms and phrases. Forward-looking statements are based on current expectations, estimates, projections and assumptions that involve a number of risks and uncertainties, which could cause actual results to differ materially from those anticipated. These risks and uncertainties include: fluctuating prices for crude oil and natural gas; changes in drilling activity; general global economic, political and business conditions; weather conditions; regulatory changes; and availability of products, qualified personnel, manufacturing capacity and raw materials. If any of these uncertainties materialize, or if assumptions are incorrect, actual results may vary materially from those expected. 2

AGENDA Canadian Industry Company Overview Overview and and Ongoing Near Term Investment Trican’s Business Market Outlook Summary Competitive Transformation Positioning 3

TRICAN OVERVIEW

WHAT WE DO  Focused in Canada, Trican has a highly trained workforce Completion dedicated to safety and Drilling Cycle Cycle operational excellence who Fracturing provide a comprehensive array Cementing Coil Tubing Services of specialized products and Fluid Management services using equipment required for the exploration and development of oil and gas reserves Production Full Cycle Cycle  Trican has been servicing wells Technical Coil Tubing Expertise in western Canada for more Acidizing Customer than 23 years Pipeline Services Engineering Support Industrial Services Reservoir Expertise Trican service lines cover 60%  Laboratory Services Chemical Services to 70% of a typical well cost Remedial Cementing 5

BUSINESS TRANSFORMATION: OUR STRATEGIC PRIORITIES REMAIN INTACT Having safe, efficient, customer- - Maintain market leading position in Fracturing and Cementing service lines focused operations is always Strengthen priority #1. Beyond safety and - Strengthen auxiliary service lines (Coiled Tubing) Existing operational performance, our Business - Activate parked equipment (if return hurdles can be met) strategic priorities remain intact: Growth - Growth in existing or complimentary, less capital intensive, less cyclical services lines To achieve top quartile ROIC in our sector Share- - Disciplined investment into future growth – ensure ROIC hurdle rates are met holder - Return value to shareholders through share buyback program Return - Sell excess and permanently stranded capital equipment, return funds to the balance sheet Cost Control & - Reduce costs for ourselves and our clients through efficiency improvements and scale Efficiency Gains 6

BUSINESS TRANSFORMATION: 2015 AND ONGOING EFFORTS  The 2014 oil supply glut, required Trican Restructure Refocus to take decisive action  The Company’s actions have positioned Trican to weather and take advantage of near-term North American energy market Returns Right Size turbulence 7

TRICAN STRENGTH: FINANCIAL STRENGTH & RESILIENCY Debt / Tangible Capital  Company has deleveraged by more than $700 million and 0.60 $800 improved asset coverage relative to 2015 cyclical low $700 Debt / Tangible Capital 0.50 Total Debt (millions) $600 • Sold Russia business for ~ $1,720/HHP (Q3 2015) 0.40 $500 0.30 $400 • Sold US business for ~ $630/HHP (Q1 2016) $300 0.20 $200  Monetizing stranded capital by selling permanently idled 0.10 $100 assets - $0 • Sold water business in Q4 2019 for $17.6 million • Selling redundant real estate Total Debt (RHS) Debt / Tangible Capital (LHS) Canadian Results ($ millions)  Debt of $36.1MM at September 30, 2019 $1,200  Financial position allows evaluation of opportunistic $1,000 investment in North American energy market $800 $600  Lowered fixed costs and increased proportion of variable $400 costs to improve resiliency during a down cycle $200  Evaluating prudent options to diversify our revenue $0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 streams and cash flow resiliency through the cycles Revenue Adjusted EBITDA See non-GAAP measure Adjusted EBITDA as more fully described in Trican’s MD&A. 8

TRICAN STRENGTH: DIVERSIFIED SERVICE LINES Market Leading Positions  Canadian market leader in fracturing services (based Trailing 12 Month Revenues: Business Unit Breakdown on market share)  Canadian market leader in cementing services Industrial Fluid Services, 1% (based on market share) Management, Other, 2% 4%  Supporting service lines: coil tubing, nitrogen, acid, Coil Services, 7% pipeline and industrial services Strong Financial Position Cementing, 18%  Bank debt of $36 million (Sept. 30, 2019)  Positive working capital $89 million (Sept. 30, 2019) Hydraulic Market capitalization $242 million (November 5, 2019) Fracturing, 68%   2018 revenue of $900 million  Nine months 2019 revenue of $492 million 9

TRICAN STRENGTH: DRIVING EFFICIENCY IN THE CANADIAN MARKET  Deliver exceptional customer service • Drive efficiency in our business to lower our costs and the cost to our customers • Integrate small service lines with larger business lines to improve cost structure and customer efficiency • Reduce product chemistry costs resulting in lower well costs for our customers  Ongoing innovations • Largest natural gas dual fuel fleet (145,000 HHP) in western Canada to help reduce well costs and GHGs • Introducing new technology to reduce tractors on location which will provide fuel savings, result in less engine hours, and reduce GHGs • Implemented large bore treating iron, reducing repair and maintenance costs • Implementing equipment monitoring technology that will reduce repairs and extend equipment life through data management • Developed new cement blends to lower costs to customers • Lowered Fracturing product costs through implementation of new fluid systems 10

TRICAN STRENGTH: RIGHT FRACTURING FLEET  Largest fleet of continuous duty pumps; most efficient style of fracturing pump, designed for higher well service intensity plays: Fracturing Type of Pump Pump HHP % of Fleet (#) Fleet • Equipment is well maintained, hot Continuous stacked and requires no capex to 2,700 / 3,000 HHP 126 344,700 59% Duty activate Mid Tier 2,500 HHP 95 237,500 41% • Allows Trican to continue to efficiently operate in the highest service intensity Total resource plays: Montney, Duvernay and Fracturing 221 582,200 Fleet Deep Basin (accounts for ~80% of the required HHP demand in Canada) See MD&A for definition of Fracturing Fleet terms; Dual fuel HHP includes delivery of 10 retrofitted pumps for September / October  Large dual fuel fleet to offer fuel savings: 145,000 HHP of natural gas bi-fuel pumps 11

TRICAN STRENGTH: FRACTURING COMPETITIVE LANDSCAPE IMPROVING  Canadian competitive landscape much better than U.S. market  Supply is dropping which will balance market quicker than Hydraulic Capacity Active Fleets anticipated Horsepower Crewed (HHP) Equipment capacity down approximately 275,000 HHP since Q1;  Trican 582,200 297,000 8 continues to drop Competitor A 305,000 193,000 5  Trican and industry will not staff additional capacity until prices Competitor B 298,000 225,000 6 improve Competitor C 170,000 128,000 3 Competitor D 250,000 140,000 3  Estimated industry demand of ~1,000,000 HHP average in 2H19 Competitor E 263,000 175,000 5 • Approximately 70 to 75% utilization Competitor F* 80,000 75,000 4  Approximately 750,000 HHP overcapacity in the basin (unstaffed) Competitor G* 50,000 50,000 4  Staffed crew levels approximate expected market demand in 2020 1,998,200 1,283,000 38 • Assuming minimal change in activity in 2020 from 2019 * Smaller crews not suitable for all higher intensity plays • Roughly 19 larger total fleets currently unstaffed Source: Competitor company reports, internal company data, and internal estimates • Roughly 55 additional rigs in deeper plays uses all capacity in basin (~30% increase in activity) 12

TRICAN STRENGTH: ALIGNING COST STRUCTURE TO NEW CANADIAN MARKET  To align our business to the new post 2015 Canadian market dynamics and lower average well counts: • Merged with Canyon in, synergies obtained improved low-cycle returns • Modernized system infrastructure to support further business optimization • Since 2017, sold $45 million of excess property and equipment at values approximating net book value • Realized $40 million cost reductions since late 2018 13