CFL
TSX-V
1
Corporate Presentation
December 2015
Dividend and Growth
TSX-V: CFL
Dividend and Growth TSX-V: CFL CFL 1 TSX-V Forward Looking - - PowerPoint PPT Presentation
Corporate Presentation December 2015 Dividend and Growth TSX-V: CFL CFL 1 TSX-V Forward Looking Statements or expectations upon which they are based will Certain information with respect to CERF The Company cannot can guarantee future
CFL
TSX-V
1
Corporate Presentation
December 2015
TSX-V: CFL
CFL
TSX-V
2
P.O Box 1326 Vernon, BC, V1T 6N6
By its nature, forward-looking information involves numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and
forward looking statements will not
Forward-looking statements and information in this presentation herein include, but are not limited to, statements with respect to:
Company’s rental fleet;
acquisitions and dispositions; and
analyst consensus. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct.
Certain information with respect to CERF Incorporated (the “Company”) in this presentation herein contain certain forward- looking statements and forward looking information which are based upon the Company’s current internal expectations, estimates, projections, assumptions and
“expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “may”, “will”, “potential”, “proposed” and other similar words,
“may” or “will” occur, are intended to identify forward-looking statements and forward- looking information. These statements are not guarantees of future performance and involve known and unknown risks, uncertainties and
events to differ materially from those anticipated in the forward-looking statements
may contain forward-looking statements and information attributed to third party industry
can be no assurance that the plans, intentions The Company cannot can guarantee future results, levels of activity, performance or achievements. Consequently, there is no representation by the Company that actual results achieved will be the same in whole or in part as those set out in the forward-looking statements and information. Some
beyond the Company’s control, which could cause results to differ materially from those expressed in the forward-looking statements and information contained in this presentation herein include, but are not limited to:
United States and globally;
to realize anticipated benefits
acquisitions;
skilled personnel;
and
regulatory authorities; Readers are cautioned that the foregoing list of factors is not exhaustive.
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TSX-V
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As at December 1, 2015
Trading Symbol TSX-V
CFL
Shares outstanding (Basic)
36.4 mm
Share price
$0.72
52 week high / low
$2.96 / $0.70
Volume (30 day avg.)
43,916
Yield
11%
Market Capitalization
$26 mm
Net Debt (Q3)(1)
$30.6 mm
Enterprise value (EV)
$57.0 mm
(1) Net debt is calculated as bank debt + interest bearing obligations – unrestricted cash
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OILFIELD RENTALS SEGMENT
2014
(2) (1)(2)
Energy Services Division
(1) Adjusted EBITDA shown here does not include $2.4 mm in unallocated corporate fees (2) Includes Winalta for 4 months of 2014 and Empire for 7 months of 2014
Industrials Division
INDUSTRIAL RENTALS SEGMENT WASTE MANAGEMENT SEGMENT
2014
(1)
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Total Distributions / Share
Earnings Per Share (TTM)
Current Annualized Dividend
As at December 1, 2015
Current Price
Consecutive Quarterly Dividends
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Strategic opportunities within the business segments Target top-line growth rate of 10%
Six accretive acquisitions to date 3 energy services / 3 industrials Balanced cash and share Target - high margin / low head count
Diversified model provides dividend stability More than $26 mm paid in dividends to date 41 consecutive quarterly dividends
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Heaters Generators Compaction Other Equipment Industrial Rentals Segment Waste Management Segment Manage 5 Government Landfills Manage 2 Government Transfer Stations Contracted Transfer Services Commercial Waste Collection
CFL
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8 35K sq. ft. facility on 6 Acres
CFL
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* Alberta Finance and Enterprise
Compressors 9% Generators 16% Compaction 10% Heaters 20% Other 45%
400 plus active customers
Major construction contractors Home builders Government and infrastructure
85% repeat customers
Top 10 customers 1/3 revenue Average relationship 14 yrs.
Economic growth in Alberta
Alberta TTM building permits up 18%*
8
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7 Regional Facilities
5 Government 2 Government transfer stations Long term contracts
Commercial waste collection
Roll-off bin and collections services
EBITDA margins of approximately 20% Opposite seasonality to Equipment Rental Business
Landfills Cities
Drayton Valley
AB
Calgary Edmonton Camrose Leduc Rose Ridge
Aspen Hinton
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Industrial Rentals Segment
Organically grown since 1998 Large and growing market in Canada
Waste Management Segment
Provide additional services for existing facilities Add new contracts Acquisitions
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Acquisition Strategy
Geographic expansion Undercapitalized targets
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Modern, diverse rental fleet High-quality modular accommodations
Wellsite accommodations Integrated Wellsite System (IWS) Drill Camps Dedicated Geo labs (DGL)
Specialty pipe
Replacement Value
Surface Rentals $19 mm / 23% Accommodations $54 mm / 67% Downhole Equipment $8 mm / 10%
Downhole Equipment Surface Rentals Accommodations
Heavy weight drill pipe Drill pipe Drill collars Related handling equipment 400 bbl. Tanks Floc Tanks Generators Full complement of equipment
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Drill Pipe Wellsite Accommodation Shale Tanks Light Towers 400 bbl Tanks Floc Tanks Generators Specialty Drill Pipe
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Leveraging existing client relationships and expanding product
CAPEX allocation to assets required for customers operating longer-term, less seasonal Operational efficiencies through better utility of services technicians Acquisitions that expand operational footprint
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$15 $27 $34 $47 $58 $5 $8 $8 $13 $19
$0 $10 $20 $30 $40 $50 $60 $70 2010 2011 2012 2013 2014 Revenue EBITDA
($MM)
Note: 2015 CERF consensus includes estimates by Global Securities and Alta Corp, Industrial Alliance and Mackie Research
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$11 $17 $29 $20 $33
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 $0 $5 $10 $15 $20 $25 $30 $35 2010 2011 2012 2013 2014
Net Debt (1)
Assets
Liabilities
Net Debt(1) / EBITDA(2) Dec 31, 2014 Dec 31, 2013
Cash and equivalents
$1,603 $557
Working capital
$10,060 $2,271
Long-term debt
$33,351 $18,907
(1) all interest bearing debt ( bank debt + financial leases) (2) CERF Adjusted EBITDA plus stock based comp, acquisition expenses + non recurring expenses
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Management
Joined
Austin Fraser
President 2014 Former President of Winalta Inc.
Derrek Wong, MBA,CFA,FCMA
CFO 2014 Over 25 years financial management and capital markets experience
Skip Kerr
COO 2013 30 years of waste industry and management experience Independent Directors
Joined
Artie T. Kos
Executive Chairman 2015 Chairman and Chief Executive Officer of ATK Oilfield Transportation Inc.
Director 2014 President and CEO of Enerflex Ltd.
Bill Guinan
Director 2005 Partner of BLG LLP
David Maplethorpe
Director 2011 Former CEO of MCL
Brad R. Munro
Director 2014 President and CEO of Bittercreek Capital Corp.
Wayne Wadley
Director 2014 Founder and former President and CEO of CERF Incorporated.
Ken Stephens
Director 2005 Former CFO of CERF Incorporated (Retired)
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TSX-V: CFL
Industrials & Energy Services
Derrek Wong MBA,CFA,FCMA VP Finance and CFO (780) 410-2998 drwong@cerfcorp.com Austin Fraser, EVP Corporate Development (780) 410-2998 afraser@cerfcorp.com