Analyst Presentation February 2019 ADES at a Glance WHO WE ARE - - PowerPoint PPT Presentation

Analyst Presentation

February 2019

2 ADES INTERNATIONAL HOLDING | Analyst Presentation

ADES at a Glance

• ADES International Holding (“ADES” or the “Group”) is a

leading oil & gas drilling and production services provider in the Middle East and North Africa (“MENA”) focused on creating value for E&P Players in the region

• Constantly evolving portfolio of services that primarily

includes offshore and onshore contract drilling, workover and production services

• ADES specializes in acquiring and refurbishing legacy ‘fit

for purpose’ offshore assets which (among other cost- saving measures) enable the Group to offer competitive rates to its clients

• Backed by a capable in-house refurbishment and

maintenance team, the Group benefits from a highly- skilled, low-cost workforce

• The Group’s business revolves around providing tailored

solutions and superior service to its clients

• ADES’s offering is characterized by its commitment to

global industry standards and ever-expanding services and solutions

Leading MENA- based O&G Service Provider Differentiated Low- Cost Business Model Customer-Centric Approach

WHO WE ARE

3 ADES INTERNATIONAL HOLDING | Analyst Presentation

Our Markets

Expanding Our Regional Presence

The new assets under ADES’ umbrella reinforce its position in the Saudi Arabian and Algerian markets and enables the expansion of its regional footprint into Kuwait.

1 2 3 4

Algeria Egypt KSA Kuwait

+6

• nshore rigs(1)

3

• nshore rigs

1

MOPU

7

• ffshore rigs

11

• nshore rigs

6

• ffshore rigs

12

• nshore rigs

Existing Markets

The Group currently operates in Egypt, Algeria, and the Kingdom of Saudi Arabia, but plans to expand its

• perations throughout the region

New Markets

ADES executed two acquisitions, which while growing its presence significantly in the KSA, both offshore and onshore, will also see the Group to enter the onshore drilling space in Kuwait

New markets Existing markets

1 2 3 4

(1) With the Kuwait and KSA segments of the Weatherford acquisition finalised in November and

December 2018 respectively, ADES continues to work towards closing the acquisition of six remaining rigs in Algeria and delivery of 2 rigs in South Iraq

4 ADES INTERNATIONAL HOLDING | Analyst Presentation

Highly Experienced Management Team

Investor Relations Officer Chief Strategy Officer Years of Experience Year Joined ADES

34

• Dr. Mohamed Farouk

Chief Executive Officer

✓ Senior Vice President, Invensys

Operations Management (Now Schneider Electric)

✓ Director, Global EngineeringExcellence

Centers

27 Years 2012

Aly Makhlouf International Markets Director Ahmed Mohy Egyptian Market GM Hussein Badawy 28 Years 2014 24 Years 2009 10 Years 2016 Mohamed Khalil VP Operations Country Manager Country Manager Omar Saleh 12 Years 2016 44 Years 2012 Morcos William Legal Counsel Shoukry El Sayed VP Projects Project Manager Project Manager 14 Years 2015 38 Years 2013 Ahmed El Khatib Chief Financial Officer Country Financial Controller Country Financial Controller 21 Years 2017 Gamal Mohamed Ahmed HR Director Country HR Manager Country HR Manager 12 Years 2006 Mohamed Saad Maintenance Director Maintenance Superintendent Maintenance Superintendent 18 Years 2015 Amr Wafik HSE Director HSE Superintendent HSE Superintendent 22 Years 2009 Mohamed Hegawy Supply Chain Director Supply Chain Manager Supply Chain Manager 18 Years 2017 Mahmoud Habashi QMS Director QMS Manager QMS Manager 33 Years 2013 Ayman Ragai Chief Information Officer IT Manager IT Manager 27 Years 2016

◼

Ph.D. Systems Engineeringand Control, Case Western Reserve University, USA

◼

M.Sc. Electrical Engineeringand Control, Faculty of Engineering, Cairo University, Egypt

◼

B.Sc. Electrical Engineering,Faculty of Engineering, Cairo University, Egypt

5 ADES INTERNATIONAL HOLDING | Analyst Presentation

Strategy

6 ADES INTERNATIONAL HOLDING | Analyst Presentation

10 19 49 75 101 134 158 127 2011 2012 2013 2014 2015 2016 2017 9M2018 Revenue (USD MN) Brent Crude (USD/bbl)

109 USD/bbl 105 USD/bbl 91 USD/bbl 100 USD/bbl 48 USD/bbl 46 USD/bbl 51 USD/bbl 78 USD/bbl

ADES – Strategy

Activity remains higher due to lower break-even prices in the MENA region than the global average Focus on workover drilling and maintenance, mainly constituting OPEX expenditure, which is typically less cyclical than CAPEX expenditure ADES mainly assesses its potential acquisitions through two methods: ▪ Buy-to-Contract Model – Securing the contract first, then finalising the acquisition of the asset ▪ Contract Acquisition Model – Acquiring chartered assets with on-going contracts Target backlog of 2x net debt – ensuring maintenance

• f a minimum level of liquidity to pay its contractual
• bligations at all times

Focus on Low Cost

• f Production Areas

Such as MENA Focus on Workover Drilling & Maintenance Considered Approach to Acquisitions Backlog Management

▼ 49%

Brent Crude

▲ 110%

Group Revenue

▲ 141%

Group EBITDA(1)

2014-17 Cycle-Proof Business Model

(1) Adjusted EBITDA - Operating profit for the year before depreciation and amortisation, employee benefit provision and other provisions and impairment of assets under construction under construction

Backlog (USD)

7 MN

Backlog (USD)

67 MN

Backlog (USD)

78 MN

Backlog (USD)

117 MN

Backlog (USD)

225 MN

Backlog (USD)

501 MN

Backlog (USD)

427 MN

Backlog (USD)

437 MN

7 ADES INTERNATIONAL HOLDING | Analyst Presentation

Strong Competitor in the Region

IOCs NOCs Independents ABS ISO Certification Company Pre-Qualifications Memberships

ADES’ diverse client relationships have been forged by seeking pre-qualification status to provide drilling and workover services well before a contract is secure, thereby creating a significant barrier to entry

Solid Track Record

Ranked #2 Offshore Jack-Up Driller in MENA (1)

High Profile Client Base

Comprising a diverse range of leading oil companies

World Class Qualifications

Adhering to Global best practice

ABS Class Certificate The Group’s

• perational drilling
• ffshore fleet is either

ABS certified or currently pending recertification

 ISO 9001:2008 Certification ISO 29001:2012 Certification 

20 14 12 11 8 8 6 6 4 4 4 3

Note (1): By number of rigs in November 2018; Note / Source: Clarkson's Research

>90%

Fleet utilisation since 2012

• No. of Rigs

8 ADES INTERNATIONAL HOLDING | Analyst Presentation

38% 22% 19% 10% 5% 4%2% Middle East North America CIS Africa Asia Pacific

• S. & Cent. America

Europe

Middle East Continues to be the Region with the Leading Oil Production and Proven Reserves

Key Market Characteristics

The Middle East is the leading oil-producing region globally with almost 40% of the world’s proven reserves. The sector constitutes a significant share of GDP and is a major source of FDI Distribution of Proven Reserves(1) Distribution of Oil Production(1)

(1) Source: Wood Mackenzie Production as of 2018, Reserves remaining as of Jan-19 ; (2) Source: Factset as of January 9, 2018; (3) Source: JPMorgan 2019 Oil Service Field Outlook 20 40 60 80 100 120 140 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Average Monthly Historic Price Current Forward Forward 1 Month Ago Forward 3 Months Ago Forward 6 Months Ago Forward 1 Year Ago

Oil Price Outlook(2)

US$/bbl

While it is expected some degree of capital risk aversion in NOC / IOC budget decisions in response to recent commodity retrenchment, historically there is a budget growth correlation to prior year oil price(3) ( which averaged US$70+/bbl, 22% 2018 YTD increase)

22%

34% 20% 14% 11% 9% 8% 4% Middle East North America CIS Asia Pacific Africa

• S. & Cent. America

Europe

After recent volatility, oil price curve has moved back into Contango which would support continued investments in upstream sector

9 ADES INTERNATIONAL HOLDING | Analyst Presentation

Robust Outlook for Investment in Upstream in Middle East

(1) Source: IHS Markit; (2) JPMorgan 2019 Oil Service Field Outlook; (3) Source: Wood Mackenzie; (4) Source: Wood Mackenzie, Jack-ups operators for wells spud from 2010 to 2018 in Middle East.

Middle East Upstream Investment

▪ Commitment to investing in upstream by the 3 largest contributors to OPEC production remains strong despite OPEC volumes being squeezed to protect price ▪ Upstream investment in the ME showed remarkable resilience during the downturn ▪ Spend has fallen 19% from US$ 83bn in 2014 to US$ 67bn in 2018 whereas global spend is down 40% ▪ Most of the drop has been in Iraq on the back of government finances been affected by lower prices and Iran owing to geopolitical uncertainty ▪ The dominant theme in the region is the expansion of oil production capacity ▪ Saudi Arabia, Kuwait and the UAE are focusing on brownfield projects with large-scale reserves around core fields already in production(3) ▪ ME is expected to grow at a record ~15% in 2019 driven by KSA, Algeria and Abu Dhabi with the spend being levered to drilling(2) Production Forecast to 2030(1)

Bn bbl

• 2

4 6 8 10 12 14

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Middle East North America CIS Latin America Africa Asia Pacific

Key Market Characteristics

Energy Holding Energy Investment Companies Independents Holding's subsidiaries

Jack-Ups Operators in the Region(4)

57% 37% 4% 2% NOC Others Large Caps International Majors “We will spend more than half a trillion Saudi Riyals (US$ 133bn) on drilling activities over the next decade, in compliance with the goals and objectives of the ambitious Saudi Vision 2030.”

Mohammed Al-Qahtani, Saudi Aramco’s Sr. VP for upstream

“With the blessing of HH Sheikh Khalifa, the Supreme Petroleum Council approved AED 486bn (US$ 132bn) in capex to support ADNOC’s 5-year growth plans... ADNOC will increase oil production capacity to 5mpbd by 2030.”

Sheikh Mohamed, Abu Dhabi Crown Prince, Nov 2018 Other Qatar Iran Iraq Oman Kuwait UAE KSA 10 20 30 40 50 60 70 80 90 2014 2015 2016 2017 2018 2019 2020 2021

ME Spend – Breakdown per Country(3)

US$ bn

Strong commitment by Middle East NOCs to investing in upstream sector driven by a long-term view on growth in demand and a desire to maintain or increase market share

10 ADES INTERNATIONAL HOLDING | Analyst Presentation

Middle East has the Lowest Extraction Cost Globally

Overview per Region

10 20 30 40 50 60 70 80 90 100 110 120 Canada Tar Sands Barents Sea Angola Deepwater Australia US Tight Oil Nigeria Deepwater North Sea Brazil Pre-Salt UAE Egypt Egypt Saudi Arabia UAE Kuwait Saudi Arabia

Onshore Offshore

US$/bbl Range

NB: Breakeven prices can vary widely within areas, countries and even basins depending on factors of geology, geography and industry regulations

2018 Average Brent Price: US$ 71.1/bbl

CORE MARKETS

ADES operates in countries characterized by low extraction costs, non harsh environments and the pre-dominance of drilling intensive legacy fields ✓ ✓ ✓ ✓ ✓

ADES’ current presence

11 ADES INTERNATIONAL HOLDING | Analyst Presentation

ADES’s Core Focus is on “Non-Harsh” Environments

Onshore Shallow Water Deep Water Ultra Deep Water Onshore Rigs Jack-up Rigs (Up to 400ft) Semi-submersible Rigs (<10,000ft) Drill ships (>10,000ft)

Jack-Up Fleet Locations(1)

(1) Source: Clarkson Dec-18, data as of Dec-18 (2) Source: Daleel Oil & Gas Supply Portal & Baker Hughes

Onshore Fleet Locations(2)

(1)

22% 18% 16% 13% 12% 11% 8% North America NW Europe S&C America Asia Pacific Med / Casp./ BI. Sea West Africa Middle East/ISC 44% 22% 11% 10% 8% 4% 1% Middle East/ISC Asia Pacific North America NW Europe Med / Casp./ BI. Sea West Africa S&C America

Floater Fleet Locations(1)

53% 22% 5% 9% 3% 4%4%2% Russia and CIS USA Canada Middle East Africa Asia-Pacific Latin-America Europe

12 ADES INTERNATIONAL HOLDING | Analyst Presentation

Focus on Stable and Resilient Jack-up, Legacy Rigs Segment

Shallow Drilling is an Attractive Segment(1) Legacy Rigs vs New-builds(1)

Shallow water basins are dominated by lower-risk brownfield projects (development drilling) with attractive economics resulting in lower volatility and quicker recovery during downturns (shorter cycle)

50% 60% 70% 80% 90% 100% '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19

Utilization

Floaters Utilization Jack-up Utilization

Reflected in more resilient utilisation rates More resilient day rates … And more stable backlog days

(1): Source: Clarkson Dec-18 report

▪ Given their high G&A cost structure and reliance

• n outsourced (costly) maintenance approach, big

global offshore drillers opt to scrap their legacy assets ▪ Low cost, legacy assets offshore drillers have the requisite cost structure and internal refurbishment capabilities to profitably deploy old legacy assets in the appropriate markets ▪ Legacy assets are a norm in the Middle East market ▪ During the most recent downturn, legacy assets have outperformed new-build assets (as measured by % utilization)

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 50 100 150 200 250 300 350 400 450 500 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18

<=1978 utilization 1979-1985 utilization 1986-2005 utilization 2006+ utilization

Utilization by Build Cycle # of active Rigs Jack-up Fleet Age Profile of Shallow Water Rigs

23% 49% 4% 7% 18% 1976-1980 1981-1985 1986-1997 1998-2008 2009+

120,000 100,000 80,000 40,000 20,000 60,000

Jan-09 Jul-09 Total Days Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Jan-16 Jul-16 Jan-17 Jul-17 Jan-18 Jul-18 Jack-Ups <=300ft Jack-Ups >300ft

Jack-Up Backlog

Total number of contracted days for jack-up fleet and vessels under construction. Excludes undeclared optional contract periods.

600 500 400 200 100 300 300 250 150 100 50 200

Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18

350

Floater & Jack-Up Dayrates

Floaters

US$’000/day Jack-Ups US$’000/day

13 ADES INTERNATIONAL HOLDING | Analyst Presentation

Middle East Drilling Industry Has Exhibited Strong Growth While Keeping Utilizations High

(1): Source: Clarkson Dec-18; (2) Source: Drilling Contractor - Official Magazine of the International Association of Drilling Contractors; note: Utilization rate of all regions shown were sourced from this report. Utilization rate of Europe refers to Europe / FSU / Russia as per magazine. (3): Source: International Drilling Activity by Region - Spears - Dec 2018; note: Only growth of North America and Asia / China; Asia and China refers to Far East and China as per report. (4): Source: Baker Hughes Rig Count (except North America and Asia / China). (5): Source: Drilling Contractor - Overall refers to average of international Land Rig utilization excluding US & Canada

58% 35% 65% 69% 61% 77% 79%

(100%) (80%) (60%) (40%) (20%) 0% 20% 40% 60%

1 2 3 4 5 6 7 8

Regional Jack-up Rigs Growth & Utilization Rates(1)

Size of the bubble Jack-up Utilization (Avg. 2018)

Rig Growth (’10- Present) North America S&C America West Africa NW Europe Asia Pacific Med./Casp/Bl. Sea Middle East/ISC

95% 87% 88% 91% 93% 95% 87% 74% 64% 66% 71% 99% 90% 90% 91% 94% 96% 90% 85% 78% 77% 79% 50% 60% 70% 80% 90% 100% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Global Middle East

Jack-up Rig utilization rate at start of each year

The Middle East is the only region to witness rig growth since 2009 and enjoys the highest Jack-up utilization rate

Onshore Rigs Growth & Utilization Rates

62% 72% 75% 79% 84% 78%

(80%) (60%) (40%) (20%) 0% 20% 40% 60% 80% 100%

1 2 3 4 5 6 7

Size of the bubble Onshore Utilization (Avg. 2018)(2)

Rig Growth (’10- Present)(4) North America(3) S&C America Europe Africa Middle East/ISC Asia / China(3)

84% 88% 90% 95% 85% 91% 81% 70% 71% 77% 82% 90% 97% 100% 94% 100% 99% 75% 77% 84% 50% 60% 70% 80% 90% 100% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Overall Middle East

Onshore Rig utilization rate average of each year(2)

14 ADES INTERNATIONAL HOLDING | Analyst Presentation

• Evaluate proposed

acquisition

• pportunities

IPO of ADES

Smart Execution Evaluating Acquisitions and Backlog Renewal

Roadmap to Growth

• Signed Definitive

Acquisition Agreement 31 onshore drilling rigs – Weatherford (KSA, Algeria, Kuwait and Southern Iraq)

• Finalised Nabors

Acquisition 3 operating offshore jack-up rigs (KSA)

• Extensive integration

plan - Restructure the new business for a streamlined integration with the Group’s newly acquired assets

• Incorporate newly

acquired assets within governance to safeguard the interests

• f all our stakeholders
• Working with top-tier

consultants for a seamless Integration as well as the enhancement of Group’s HSE and Governance framework

• In the medium-term

ADES’ is expected to generate strong cash- flows supporting the distribution of dividends

• ADES will continue to

grow organically by participating in accretive tenders and growing its backlog

• Capitalise on increased

tendering capacity through strategic agreements with leading shipyards

• Secured Standby

Credit Facility SAR 525 million (US$140 million) from Alinma bank

Integration & Governance Organic Growth  Dividends

• Secured Syndicated

Credit Facility US$450 million - arranged by the Bank

• f America Merrill

Lynch and the EBRD

Market Sentiment

• Positive Market

Sentiment drives management’s decision to IPO

• Participated in

competitive processes for promising tenders, which led to Nabors and Weatherford acquisition) while consistently renewing Group backlog

• Acquisitions resulted

in:

• Almost USD 1bn of

additional backlog

• USD 250mn of

additional revenue

15 ADES INTERNATIONAL HOLDING | Analyst Presentation

Operational Excellence

16 ADES INTERNATIONAL HOLDING | Analyst Presentation

To ensure that the Group continues to deliver exemplary safety and health standards, ADES has appointed a top tier HSE consultant to review the Group’s safety procedures and ensure its continued adherence to the highest safety standards.

Health, Safety and Environmental Responsibilities

HSE Overview HSE Incident Statistics

2016 2017 H1 18

Total Working hours (‘000) 2,792 4,343 2,263 Recordable injury rate (200,000 man-hours) 0.40 0.41 0.62 IADC worldwide RECRD incident rate up to date 0.58 0.45 0.69

• As an oil and gas service provider, ADES is committed to complying with
• ccupational health, safety and environmental care standards as a sign of its

commitment to excellent quality service

• The HSE Management System provides ongoing identification, prioritization

and control of any risk that may arise. This system establishes a continuous improvement process for the implementation of the HSE policy, leadership expectations and core values

Improve Plan Perform Measure Act

Incident and Injury Free Workplace (IIF)

HSE Management System

The consultants have carried out a preliminary safety culture assessment, which addresses the following topics:

I 2 3 4

A full safety culture assessment through interviews of more than 45 employees from cross section

• f ADES.

Plan IIF sessions in town, for the crews of three select rig sites as well as Cairo office employees

• in. To be rolled-out in the KSA at a later stage

Carry out IIF coaches training which shall be provided to ADES nominated IIF coaches Post-IIF sessions, Offshore unit visits to evaluate IIF measures have been adequately employed

17 ADES INTERNATIONAL HOLDING | Analyst Presentation

Human Resources Department

Human Resources in Perspective

Human Resources Department Main Objective : Hire talented calibers, train & develop their knowledge, skills & abilities, with the aim to retain our valuable employees to match the market requirements and achieve the company’s strategic goals.

Talent Acquisition Head Count & Turnover Rate

532 770 1241 1330 3587 500 1000 1500 2000 2500 3000 3500 4000 2014 2015 2016 2017 2018 Headcount

Turnover 4.8% Includes 140 Third Party employees 340 Will be added shortly

• ut of which 294 are 3rd

party employees

• Set the recruitment strategy in alignment with company strategic

direction with the aim to position the company as an employer of choice.

• Attract and hire the best qualified candidates from within or outside the
• rganization
• Promote the mobility of the senior leadership team across different

countries.

Engagement & Communications

ADES has a new approach through the establishment of a new section – Engagement & Communications – with the aim to:

• Build a solid internal communication strategy.
• Design Culture transformation methodologies to empower the core

values and ADES DNA through different programs.

• Measure employee satisfaction toward the company through

monitoring engagement surveys and initiate corrective actions if required.

Team Building Activity Engagement Survey ADES Workplace Regular Comms.

Safety Leadership Turbo Day Regular Rig Visits ADES Annual Event

To project the achievements and milestones took place, communicate future plans and reward best performers.

Satisfaction Survey Special Events in Different occasions

18 ADES INTERNATIONAL HOLDING | Analyst Presentation

Human Resources Department Cont’d

Training & Development

ADES is committed to promote an environment of training and continuing professional development for its employees. The company provides numerous training courses that covers the training requirements of tier one clients for example: Aramco, KOC, EGPC, BP and Eni. Develop competency management system (CMS) and On Job Training system (OJT) to measure the abilities, commitment, knowledge and skills for the job holder to ensure high level of efficiency while performing the required job. Design different development and succession programs in alignment with the company strategic objectives.

Emergency Operational Lifting Drilling Marine Medical HSE Mechanical Electrical

Course Categories

Total number

• f courses are

123

26,202 18,888 15,237 Training Hours - 2018 HSE Technical Soft Skills

60,327

19 ADES INTERNATIONAL HOLDING | Analyst Presentation

ADES is about to introduce its Training ARM to the Oil & Gas market under the title of “ ADES Academy “ to train and develop its human capital. Seeking Accreditations:

• IWCF “International Well control forum “
• IADC “International association of drilling contractors”
• LEEA “Lifting equipment Engineers Association
• ASHI “American Safety & Health Institute”
• NEBOSH “National Examination Board in Occupational Safety and

Health

ADES Academy

Human Resources Department Cont’d

ADES is about to introduce its new training management System or portal after acquiring the license of “ Skills VX “. This software facilitates the management of training process (TMS), Competency Management (CMS) and Learning Management System (LMS)

Advanced Training Management Platform Talent Development Programs

Under Graduate Training Program Graduate Training Program Special Program Future Managers Program

Summer Internship Program (SIP) Assistant Rig Manager Program (ARMP) Graduate Training Program (GTP) Rig Mover Program (RMP) SADA SPSP OIM Trainee Program (OTP) ADES offers a diversity of development and succession programs in all levels whether undergraduates, graduates, specialists or even highly experienced in alignment with the company strategic objectives.

Competitive Packages: ADES always seeks to provide competitive packages to its employees specially for the key positions. ADES salary scale meets and exceeds the market scale in accordance to the criticality of the positions. Incentive Based Compensation (KPIs): The performance of ADES employees is based on management by

• bjective, whereby each employee has their salary split into a fixed part

and a variable part which is directly linked to the performance of the employee pertaining to their specified role. Benefits: Employees usually receive additional upgraded benefits according to their employment grades, including medical coverage that is extended to the employee’s family, life insurance & allowances (including for certain travel, transportation, mobile expenses). ADES World: ADES world is a portal for discounted offers that is designed for corporate

• employees. These offers may vary from travel offers to discounted goods

via several methods and application.

Employee Retention

20 ADES INTERNATIONAL HOLDING | Analyst Presentation

Fleet Utilisation Schedule | Offshore

Contracted Good Chance for Renewal Optional Extension Contracted with Previous Owner

2017A 2018E 2019E 2020E 2021E 2022E 2023E 2024E 2025E 2026E Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

ADMARINE I Egypt ADMARINE II Egypt ADMARINE III Egypt ADMARINE IV Egypt ADMARINE V Egypt ADMARINE VI Egypt ADMARINE VIII Egypt ADMARINE 88 Egypt ADMARINE 261 KSA ADMARINE 262 KSA ADMARINE 266 KSA ADMARINE 655 KSA ADMARINE 656 KSA ADMARINE 657 KSA

21 ADES INTERNATIONAL HOLDING | Analyst Presentation

Fleet Utilisation Schedule | Onshore

Contracted Good Chance for Renewal Optional Extension Contracted with Previous Owner

2017A 2018E 2019E 2020E 2021E 2022E 2023E 2024E 2025E 2026E Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

ADES 2 Algeria ADES 3 Algeria Rig 155 Kuwait Rig 776 Kuwait Rig 870 Kuwait Rig 871 Kuwait Rig 180 Kuwait Rig 878 Kuwait Rig 808 Kuwait Rig 809 Kuwait Rig 144 KSA Rig 158 KSA Rig 798 KSA Rig 157 KSA Rig 173 KSA Rig 174 KSA Rig 040 KSA Rig 799 KSA Rig 889 KSA

22 ADES INTERNATIONAL HOLDING | Analyst Presentation

Recent Acquisitions

23 ADES INTERNATIONAL HOLDING | Analyst Presentation

Recent Acquisitions (1 of 2)

Nabors Acquisition - Overview

Nabors Acquisition (Completed in June 2018)

The acquisition of 3 operational offshore jack-up rigs located in the KSA, brings the number of the Group’s

• ffshore rigs under contract to 14
• Admarine 656 and Admarine 657 rigs

have been refurbished before the acquisition, with five-year certification. Both Rigs have started generating revenue immediately after the acquisition was completed.

• Admarine 655 is currently operational

after undergoing an ABS recertification process.

Rig Details Admarine 655 Admarine 656 Admarine 657

Transaction Highlights

Asset

• 3 ultra-shallow offshore drilling jack-up rigs

Location

• KSA

Current Charterer

• Aramco

Purchase Price

• USD 83 million (75% Cash - 25% ADES shares)

Seller

24 ADES INTERNATIONAL HOLDING | Analyst Presentation

Recent Acquisitions (2 of 2)

Weatherford Acquisition - Overview

Weatherford Acquisition

In July 2018, ADES announced the signing of a definitive agreement with Weatherford International plc for the acquisition of 31 onshore drilling rigs. With the Kuwait and KSA segments of the deal finalised in November and December 2018 respectively, ADES continues to work towards closing the acquisition of the six remaining rigs in Algeria and delivery of two rigs in Southern Iraq.

• 20 of the acquired 31 rigs are

currently operational

• Remaining 11 will be used in

tendering activities and for strategic inventory purposes Transaction Highlights

Asset

• 31 onshore rigs

Location

• KSA, Algeria, Kuwait and Southern Iraq

Purchase Price

• USD 287.5 million (paid by a combination of cash and secured debt instruments)

Additional Details

• The future revenue-generating ability of the 11 non-operational rigs was not factored into the

transaction’s valuation

• Rigs were acquired for a minimal cash compensation, in line with ADES’ strategy of executing

smart acquisitions at attractive prices that present significant upside potential

Seller

Details

USD 190 MN

Expected Annual Revenues

12 YRS

Average Rig Age

+ 20

Operational Rigs

4.5 YRS

Weighted Av. Contract Tenor

+2,300

Employees

USD 750 MN

Expected Additional Backlog

25 ADES INTERNATIONAL HOLDING | Analyst Presentation

Expanding Our Regional Presence

The new assets under ADES’ umbrella reinforce its position in the Saudi Arabian and Algerian markets and enables the expansion of its regional footprint into Kuwait and Southern Iraq.

Recent Acquisitions (2 of 2)

Weatherford Acquisition – Potential

6 11 2

• New markets
• Existing markets
• Acquired onshore assets

Southern Iraq Algeria KSA

3 3 6 11 12 2 31 Algeria KSA Kuwait

• S. Iraq

Total

Onshore Fleet Additions

Existing onshore fleet rigs

34

At the close of this transaction, more than 80%

• f ADES’ top-line will be generated outside Egypt.

12

Kuwait

(No. Rigs)

26 ADES INTERNATIONAL HOLDING | Analyst Presentation

Expected Combined Impact on Backlog and Top-line Performance

The new acquisitions will allow ADES to strengthen its onshore and offshore assets while adding to its backlog and expanding its revenue contribution from international markets

The new strategic acquisitions have secured ADES’ position as one of the major players in the MENA region. The newly acquired rigs are expected to contribute an additional c.USD 250 million to ADES’ annual revenues, which alone exceeds the total annual revenues recorded in 2017

Recent Acquisitions

Combined Acquisitions – Potential

3 12 15

31 3 34 34 15 49 (1)

Onshore Offshore Total Existing Rigs New Acquisitions

437 600 78 150 Existing Fleet backlog as of 30

• Sep. 2018

WDI Kuwait WDI KSA ADM 657 renewal

• c. USD

1.26 BN

158 60 150 40

FY17 New Acquisitions

Nabors Weatherford

Total Fleet Addition Expected Annual Revenue

250

Expected Backlog Distribution

The newly acquired assets’ are expected to almost triple the existing backlog as at 30 September 2018

11% 1% 49% 39% Egypt Algeria KSA Kuwait

Expected Backlog Geographical Distribution

Post-acquisitions, ADES’ backlog will come from a more diversified group of territories

(USD mn) (No. Rigs) (USD mn)

16% 7% 48% 29% Egypt Algeria KSA Kuwait

Expected Revenue Distribution

The acquisition will gain ADES entry into new markets while strengthening presence in existing markets

Note (1): Includes six rigs in WDI Algeria and two rigs in South Iraq which ADES is currently working on finalising

27 ADES INTERNATIONAL HOLDING | Analyst Presentation

Our Markets

28 ADES INTERNATIONAL HOLDING | Analyst Presentation

KSA – Market Fundamentals

Our Markets

Upside potential of the Saudi Oil & Gas market

KSA is the world’s most important oil producer, possessing c.16% of the world’s proven petroleum reserves in 2017 and ranks as the largest exporter of petroleum KSA’s oil & gas market is characterisedby low extraction costs, non harsh environments and the pre-dominance of drilling intensive legacy fields

• KSA has accounted for 65% of all jack up

drilling days added globally in 2018YTD(1), contributing 58 years of the 90 years of added jack-up backlog(2)

• Moving from 230 – 300 rigs collectively

in coming years, giving an average of 25% growth

Top 5 Markets by Proven Oil Reserves(3)

Thousand Million Barrels

Top 5 Markets by Oil Production(3)

Thousand Barrels Daily

303 266 169 157 149 Venezuela KSA Canada Iran Iraq 13,057 11,951 11,257 4,982 4,831 USA KSA Russia Iran Canada

16%

• f Global Reserves

13%

• f Global Production

(1) 2018 YTD refers to Jan-October 2018 (2) Source: Bassoe Offshore (3) Source: BP Report

29 ADES INTERNATIONAL HOLDING | Analyst Presentation

6 550+

USD230mn

ADES in the KSA (Offshore)

Our Markets

(1) Source: Clarksons Research (2) Source: Bassoe Offshore

Strengthening our Offshore Presence

Acquisitions in 2016 Acquisitions in 2018

Admarine 261 Admarine 262 Admarine 266 Admarine 655 Admarine 656 Admarine 657

In late 2016, ADES launched

• perations in the KSA with

the acquisition of three legacy offshore rigs

• perating under contract

In 2018, ADES further strengthened its presence in the Kingdom with the acquisition 3 ultra-shallow

• ffshore drilling jack-up rigs

from a subsidiary of Nabors Industries These acquisitions have enabled ADES to establish itself as a key player in the KSA oil and gas services market

Advantages of pre-qualification with Aramco

ADES’ prequalification with Aramco is expected to facilitate the expansion of services in the Kingdom Aramco’s renewal with the rigs acquired from Nabors with ADES is testament of Aramco’s confidence in the Group’s business and

• perations

Of all contracts awarded worldwide this year, Saudi Aramco has offered the longest terms: nearly 1200 days on average compared to 485 days for the rest of world average(2)

Offshore rigs Employees Backlog (3Q 18)

Presence in the KSA

ADES’ Ranking in the KSA(1)

8 7 6 6 5 4 4 4 3

ARO ENSCO ADES Rowan Shelf drilling Noble Corp Seadrill Others Arabian Drilling Co.

(No. offshore jack-up Rigs – October 2018)

30 ADES INTERNATIONAL HOLDING | Analyst Presentation

11

Onshore rigs

9

Up to 3000 USD 78 MN

923

ADES in the KSA (Onshore)

Our Markets

Entering KSA’s Onshore Space

As part of the Weatherford deal, ADES has acquired 11 onshore rigs in the KSA This marks the entrance of ADES in the KSA natural gas drilling market – making the Group one of the few players in this lucrative industry, traditionally characterised by high utilisation rates 9 rigs are currently under contract and generate an additional $78 million in the Group’s backlog. ADES is expecting to secure new contracts extensions

ADES’ Potential Ranking in the KSA(1)

(No. onshore rigs – October 2018)

43 41 35 28 9 8 16

SANAD Sinopec Arab Drill Sapiem ADES Dalma Others

Contracted Rigs Horse Power Backlog Employees

Acquisition Highlights*

(1) Source: Internal intelligence

31 ADES INTERNATIONAL HOLDING | Analyst Presentation

12

Onshore rigs

8

Up to 3000 USD 606 MN

• c. 976

Contracted Rigs Horse Power Additional Backlog Employees

48 32 31 8 7 5 7 Sinopec Burgan KDC ADES NDSC Greywolf Others

Acquisition Highlights

ADES in Kuwait

Our Markets

Upside Potential of the Kuwaiti Market

6th in the World for proven oil reserves, behind only Venezuela, KSA, Canada, Iran and Iraq Advantageous investment environment Low-cost break-even point One of the highest utilisationrates globally

ADES’ Ranking in Kuwait(1)

(No. onshore rigs – October 2018)

Advantages of pre-qualification with KOC

• Access to a privileged market with:
• High barriers to entry
• Limited number of bidders
• Restricted registration process
• Invitation to all tenders with KOC in

Kuwait

• New approach to promote the LSTK,

while there has been shortage of the rigs in the previous market tender. Kuwait’s national oil company expects to spend USD 114 billion in CAPEX over the next five years and an additional USD 394 billion beyond that to 2040

In November 2018, ADES entered the Kuwaiti market through the acquisition of 12 onshore rigs from Weatherford Int’l plc. The transaction is set to become a stable source of additional backlog over the coming six years.

(1) Source: Internal intelligence

32 ADES INTERNATIONAL HOLDING | Analyst Presentation

USD 187 MN

Employees

1000+

Cumulative Backlog (3Q 2018)

7 1

Offshore rigs MOPU

Presence in Egypt

ADES in Egypt

Our Markets

Upside Potential of the Egyptian Market

Strong profitability and return on investment driven by attractive acquisition cost of rigs and long-term continuous service Government reforms are set to boost economic growth and improve business environment 6th largest proven oil reserves in Africa(1) Lower labor cost relative to regional and global averages

The 2015 Zohr gas field discovery is set to increase Egypt’s oil reserves by around 50%

(1) Source: Clarksons Research

62.8 62.8 30 As of 2017 With Zohr Trillion Cubic Feet

ADES’ Ranking in Egypt(1)

(No. offshore jack-up Rigs – October 2018)

Admarine II While headquartered in DIFC, ADES manages the Group’s high-level activities out of its base in Egypt, where the Group has been present since 2011 Currently focuses on providing offshore drilling services in shallow non-harsh environments ADES’ continued operational performance and excellent safety record have allowed it to develop excellent relationships with the government and suppliers helping ADES mitigate the longer terms on receivables in the Egyptian oil & gas industry

8 2 1 1 1 1 1 ADES Shelf Drilling EDC EGAS Saipem Sino Tharwa Others

33 ADES INTERNATIONAL HOLDING | Analyst Presentation

Upside potential of Algerian market ADES entered the Algerian market in 2015 with the acquisition of new-build

• nshore rig ADES 2 and

has since grown its fleet to 3 onshore rigs (with

• ne of the rigs currently in

the tendering phase)

USD 13 MN

Cumulative Backlog

(3Q 2018)

3 50+

Onshore rigs Employees

Presence in Algeria

ADES in Algeria

Our Markets

Algerian proven crude oil reserves are estimated to be of 12.2 billion barrels1 High barriers to entry for international investors protect ADES’ position in the market Relatively low cost of oil production Good working capital with 75% of most contracts paid in USD and 25% in DZD Algeria is the third largest natural gas producer in the MENA region after Qatar and Saudi Arabia ADES II

34 ADES INTERNATIONAL HOLDING | Analyst Presentation

Acquisition Integration

35 ADES INTERNATIONAL HOLDING | Analyst Presentation

The Group’s extensive post-acquisition programme involves two main steps and was developed in collaboration with Boston Consulting Group, a global leader in the subject

Post-Acquisition Program

• Identify areas for development within the existing operating

model (including processes, people and governance)

• Define targets and ‘transition’ initiatives
• Identify integration risks and appropriate mitigation

strategies

• Ultimately use internal assessments and external

benchmarking to devise integration plan for the Group as a whole

• Organise strategy workshops to support ADES Senior

Executive Team in understanding rapidly changing context, determining key implications for ADES, and accordingly shaping/fine-tuning ADES' strategy

• 2 workshops held in parallel to integration programme in
• rder to reflect on steps taken and improve the efforts

going forward

In light of ADES’ recent acquisitions, the Group has already began to implement a multi-faceted post- acquisition program through dedicated integration and strategy workshops with the aim to extract the full value

• f its newly acquired assets,

people and technology

Integration Strategy

Integration 80% Strategy 20%

1 2

36 ADES INTERNATIONAL HOLDING | Analyst Presentation

Phase 1 Deliverables

Post-Acquisition Program

Integration - 80%

Key Objectives Realise "synergies" & value creation opportunities Design and build the new

• rganisation

Create a common culture and bind key people Continue day-to-day business

Organisation & People Systems & Procedures Change Management

• Baseline organisation
• Assess & identify key

talents

• Map system &

processes

• Identify overlaps
• Maturity & gap

assessment

• Diagnose current

cultures

• Derive implication for

integration

• Select optimal organisational structure
• Design operating model
• Select key resource for key functions

appointments

• Develop retention & redundancy plans
• Select best practices, identify & calculate

synergies

• Design integrated processes/system for HQ

functions and business functions

• Set target culture and identify desired behaviors
• Design interventions activities to reinforce desired

behaviors

• Design communication & engagement activities
• Design training & change management activities
• Transparent baseline of as-is
• To-be organisation design, operating model and

governance

• Transition plan to move from As-is to To-be
• Transparent baseline of current set-up
• Synergy potential analysis
• Integrated & optimised business and HQ processes

and updated policies for HQ process

• Develop transition plan
• Assessment of current culture
• Clearly articulated target culture supportive to overall

strategy, and required interventions to implement target culture

• Transition plan to implement new culture
• Regular insight in new management engagement
• Set operational &

financial synergy & targets

• Develop integrated

implementation phase roadmap

• Design governance

structure for implementation

Assess Design Plan

Strategy Integration

37 ADES INTERNATIONAL HOLDING | Analyst Presentation

Workshop 1 Workshop 2

Expected

• utcomes:
• Shared view on

relevant market developments

• Confirmation of

current strategy, or clarification of need for change (+direction and magnitude of change)

• Input for business plan

and strategic priorities for coming years Strategy Integration

Post-Acquisition Program

Strategy Workshops – 20%

Objective

Format

• 2 focused workshops (c.0.5-1.0 day) for ADES’ senior

executive team and BCG experts

• Organised in parallel to Integration, leaving room for

reflection

• Various preparatory, summarising & formalising

actions to realise optimal workshop results

Objective

Support ADES Senior Executive Team in understanding rapidly changing context, determining key implications for ADES, and accordingly shaping/fine-tuning ADES' strategy

Strategy Workshop Program

Circulate pre-read in preparation for workshop 1 Status of the drilling sector, deep dive on selected markets, competitive landscape and evolving client requirements needs, key success factors, competitive models observed Summarise outcomes workshop 1, circulate for comments, and as input for workshop 2 Detail preferred competitive models, selection and identification of implication for organisation, operating model, financials, resources and initiatives Summarise outcomes workshop 2, circulate for comments and formalise

• utput

38 ADES INTERNATIONAL HOLDING | Analyst Presentation

Key Takeaways

• Increasing diversification during 2018 through two major acquisitions – Weatherford and

Nabors assets..

• Middle East & North Africa region remains attractive
• Cost competitive, internationalized domestic workforce
• Niche market position with high barriers to entry
• Significant and growing order book backlog – in excess of $1bn
• High asset utilization – good profitability
• Robust balance sheet
• Strong Health & Safety track record
• Experienced management team.

The Regional Champion