Corporate & Investors Presentation H 2 O Innovation Presented by - - PowerPoint PPT Presentation

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Corporate & Investors Presentation H 2 O Innovation Presented by - - PowerPoint PPT Presentation

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Corporate & Investors Presentation H 2 O Innovation Presented by : August 2019 Frdric Dugr, CEO & President TSXV:HEO 1 Our Business Pillars and Business Lines 1. Water & Wastewater 3. Operation & 2. Specialty Products

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SLIDE 1

TSXV:HEO

Corporate & Investors Presentation

H2O Innovation

1

August 2019

Presented by : Frédéric Dugré, CEO & President

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SLIDE 2

TSXV:HEO

Our Business Pillars and Business Lines

2

  • 1. Water & Wastewater

Projects, and Services

  • 2. Specialty Products
  • 3. Operation &

Maintenance

W, WW, WR Systems Digital Solutions Couplings & Filter Housings Specialty Chemicals Operation & Maintenance Maple farming equipement Aftermarket Services

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SLIDE 3

Business Highlights

  • Water Treatment Solutions Provider :
  • Focus on small to mid-size municipal market in North America
  • Strong expertise in membrane filtration, notably for Water Reuse
  • Multiple proprietary filtration-related products
  • Strong O&M business based
  • Multiple references in the energy sector
  • Growing experience in DB and DBO projects
  • Business model promotes customer’s retention
  • Multiple synergies among 3 complementary business pillars
  • Export Specialty Products in > 40 countries through distributors and EPCs
  • > 675 employees
  • Consolidated sales backlog (Projects + O&M) : ≈ 140.0 M
  • > 75% of the revenues are recurrent by nature
  • Completed 12 acquisitions

3

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SLIDE 4

TSXV:HEO

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H2O’s OFFICES

Head Office:

 Québec, QC, CAN

Manufacturing Plants:

 Ham-Nord, QC, CAN  Champlin, MN, USA  Vista, CA USA

Engineering & Sales Offices:

 Burlington, ON, CAN  Calgary, AB, CAN  Bilbao, SP, EUR

Other (franchises, stores):

 Swanton, VT, USA  Saint-Louis-du-Ha!-Ha!, QC, CAN  H2O Mexico, Cancùn, MEX

Operations & Maintenance:

 Gulfport, MS, USA  Claremont, NH, USA  Las Vegas, NV, USA  Forsyth, GA, USA  Kananaskis, AB, CAN  Spring, TX, USA

Totalling 675 employees in North America & Spain

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SLIDE 5

TSXV:HEO

Revenues, Business Mix and Adjusted EBITDA

In CAD million $

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0.0 $ 1.0 $ 2.0 $ 3.0 $ 4.0 $ 5.0 $ 6.0 $ 7.0 $ 8.0 $ 9.0 $ 10.0 $ 0.0 $ 20.0 $ 40.0 $ 60.0 $ 80.0 $ 100.0 $ 120.0 $ 140.0 $ Projects SP&S O&M Adj EBITDA

Revenues EBITDA

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SLIDE 6

Unique Growth Platform

(+750 systems installed)

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SLIDE 7

Unique Value-Proposition

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Water & Wastewater Projects, and Services Specialty Products Operation & Maintenance Our Strategy Water Utilities Maximize customers’ retention by serving Water Utilities through an integrated approach and in-depth water and membrane expertise.

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SLIDE 8

TSXV:HEO

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1st Business Pillar

Water & Wastewater Treatment Projects, and Services

  • > 750 systems installed
  • Strong membrane expertise
  • Feed the aftermarket sales with

recurring consumables

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SLIDE 9

TSXV:HEO

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1st Business Pillar – Projects

Water & Wastewater Treatment Projects, and Services

Montevina, (CA) Drinking Water (30.0 MGD) Data Center, (OR) Process & Water Reuse (1.7 MGD) Decatur, (AR) Wastewater (4.6 MGD) Sherman, (TX) Drinking Water (5.0 MGD)

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SLIDE 10

TSXV:HEO

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36% 64%

Q3 - FY2019

Industrial Municipal 27% 73% Q3 - FY2018 38% 62%

Q3 - FY2019

Wastewater Water 23% 77% Q3 - FY2018

1st Business Pillar - Backlog Diversification

Water & Wastewater Projects, and Aftermarket

Decatur, AK

  • 4.6 MGD
  • Municipal

Wastewater

WaterHub, VA

  • 1.2 MGD
  • Industrial

Wastewater, Water Reuse

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SLIDE 11

TSXV:HEO

North American BWRO & SWRO Desalination Forecast

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SLIDE 12

2nd Business Pillar

Specialty Products

25 Piedmont Distributors 25 PWT Distributors 50 Maple Distributors

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SLIDE 13

TSXV:HEO

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2nd Business Pillar

Specialty Products (all manufactured in USA)

Products

Membrane Pretreatment

  • Coagulants & Flocculants
  • Scale Inhibitors
  • Antifoulant

Membrane Cleaners

  • Lavasol
  • OptiClean
  • Biocides

Membrane Preservation

  • Preservol

Services

  • On-site & off-site membrane cleaning
  • Water Analysis
  • Membrane Autopsy
  • Etc.
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SLIDE 14

TSXV:HEO

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2nd Business Pillar

Specialty Products

Product Lines

Couplings FRP Filter Housings Self-Cleaning Screen Filters Self-Cleaning Disc Filters Complementary Products

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SLIDE 15

2013 2015 2016 2017 2018

Evolution of Piedmont’s Product Offering

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2014 2019

Piedmont’s acquisition by H2O Innovation Launch of new FRP cartridge filter housings Launch of new disc and self-cleaning filters

Since it’s Acquisition by H2O Innovation

Creating value by:

  • Growing product offering
  • Leveraging sales network
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SLIDE 16

TSXV:HEO

Global Desal Market Forecast CapEx & OpEx

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CapEx >24 million m3/d

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SLIDE 17

TSXV:HEO

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3rd Business Pillar - Contracts

Operation & Maintenance (O&M)

Services

Water & Wastewater Operation & Maintenance Billing & Collection Services Additional Services

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SLIDE 18

TSXV:HEO

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3rd Business Pillar

Operation & Maintenance (O&M)

As of today:

  • 82 Contracts
  • 11 States | 2

Provinces

  • 135 Water Systems
  • 44 Wastewater

Facilities

  • 435 Employees
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SLIDE 19

Q3-FY2019

Activity per Business Pillar

19 $9.8 M $40.2 M $55.0 M Q3-FY2019 3-month Revenues LTM Revenues Backlog $7.8 M $23.3 M Q3-FY2019 3-month Revenues LTM Revenues $9.1 M $35.7 M $68.1 M Q3-FY2019 3-month Revenues LTM Revenues Backlog

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SLIDE 20

Our Business Model Promotes Synergies and Customer Retention

Example: Partnership with Sustainable Water

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Synergies in this project:

  • $3.2 M Capital Equipment

Project

➢ flexMBRTM Technology; ➢ RO system; ➢ IntelogxTM smart software.

  • $50 k / year (for 5 years) of

specialty products and consumables;

  • $3.3 M for 5 years of O&M.
  • 5 other similar projects in the backlog;
  • More than 40 opportunities.
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SLIDE 21

Corporate Information

TSX Venture : HEO / OTCQX : HEOFF

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Board of Directors : Lisa Henthorne, Chairman

CTO Water Standard, Former IDA Chairman

Frédéric Dugré, President & CEO

Mechanical Engineer, Founder

Richard Hoel, Director

Lawyer, Founding partner of Winthrop & Weinstine

Stephen A Davis, Director

Managing Partner, Ventry Industries LLC

René Vachon, Director

Former CFO of Miranda Technologies

Pierre Côté, Director

Former CTO of Zenon / GE

Robert Comeau, Director

Former CFO of Lumen Pulse

Shares outstanding : 55,889,000 2.5 million of options Officers & Directors: 10% (on a fully diluted basis) Institutional: 60% (IQ: 18% /BDC: 13% / CDPQ: 11%) Officers : Frédéric Dugré, President & CEO Marc Blanchet, CFO Guillaume Clairet, COO Management : Greg Madden, V.P. – Aftermarket & Digital Solutions Denis Guibert, V.P. – Engineering & Projects Rock Gaulin, V.P. – Manufacturing & Operations Bill Douglass, V.P. – Operation & Maintenance

Advisors to the Board :

Elisa M. Speranza

Former Senior VP and Corporate Director, CH2M Hill OMI

Leonard Graziano

Former President and CEO, Severn Trent Services, Inc.

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SLIDE 22

TSXV:HEO

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H2O Innovation

Unique smart water player

Headquarters 330 rue St-Vallier Est, suite 340 Quebec City, QC G1K 9C5 Canada 1-418-688-0170 info@h2oinnovation.com www.h2oinnovation.com