National Bank Financial Energy Conference September 2, 2020 - - PowerPoint PPT Presentation

National Bank Financial

Energy Conference

+

S O L U T I O N S M A T T E R

September 2, 2020

Statement Regarding Forward-Looking Statements

This presentation contains forward-looking information within the meaning of applicable securities laws. Words such as "may", "will", "should", "anticipate", "plan", "expect", "believe", "predict", "estimate" or similar terminology are used to identify forward-looking information. This forward-looking information is based on assumptions, estimates and analysis made in the light of the Company's experience and its perception of trends, current conditions and expected developments, as well as other factors that are believed by the Company to be reasonable and relevant in the circumstances. Forward-looking information involves known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from those predicted, expressed or implied by the forward-looking information. Additional information on the risks and uncertainties

• n the Company’s business can be found in the Company’s current Annual Information Form,

annual and quarterly reports and in other reports and filings made with the securities regulatory authorities and available at www.sedar.com and www.shawcor.com. The forward- looking information is provided as of the date of this presentation and the Company does not assume any obligation to update or revise the forward-looking information to reflect new events or circumstances, except as required by law.

Diversified portfolio 1

20+

Countries of Operation

3

Reporting Segments

5,000+

Global Employees

16

Leading Brands

265

Proprietary Formulations & Patents

$1.5B

Revenue (2019)

Investment Highlights

Established customer base 2 Supportive long-term fundamentals 3 Clear priorities 4 Secured and visible work 5

50 Years as a Publicly Traded Company

Portfolio Diversification Strategy

AUTOMOTIVE & INDUSTRIAL

Heat Shrink Solutions and Specialty Wire and Cable for Demanding Environments

COMPOSITE SYSTEMS

Corrosion Resistant Composite Pipe and Underground Storage Tanks

PIPELINE & PIPE SERVICES

Pipeline Coatings, Inspection & Integrity Solutions, and Engineering Services

• Focused on Pipe Coating
• Reliance on Large Offshore Projects
• Active NA Upstream
• Limited Non-Oil & Gas
• Growth in Non-Oil & Gas
• ZCL Composite Tanks
• Balanced and Diverse Portfolio
• Upside as Large Projects Sanctioned

9% 30% 17% 18% 26%

2013

Revenue Mix 30% 32% 17% 19% 2%

2020 (YTD)

Revenue Mix

Non-Oil & Gas Int’l & Offshore NA Midstream NA Upstream Large Projects

• Geographic Reach and

Product Diversity

• Presence in all Major Oil

and Gas Basins

• High Barriers To Entry
• Product Expansions
• Low Risk of Technological

Disruption

• Digital Technology
• Experienced Executive

Team

Highlights

24% 25% 21% 26% 4%

2019

Revenue Mix

5

Established Customer Base

TRANSPORTATION

Automotive

HEAT SHRINK & COLD APPLIED PRODUCTS

Transit

SPECIALTY WIRE & CABLE

Fuel

COMPOSITE TANKS MANAGEMENT & ENGINEERING SERVICES

INFRASTRUCTURE

COMPOSITE TANKS

Water Electrical & Distribution

SPECIALTY WIRE & CABLE

Power Generation

SPECIALTY WIRE & CABLE HEAT SHRINK & COLD APPLIED PRODUCTS HEAT SHRINK & COLD APPLIED PRODUCTS COMPOSITE PIPE

ENERGY

Upstream

COMPOSITE PIPE OILFIELD ASSET MANAGEMENT

Midstream

INTEGRITY MANAGEMENT MANAGEMENT & ENGINEERING SERVICES PIPELINE SERVICES & PRODUCTS COMPOSITE TANKS

Composite Systems Automotive & Industrial Pipeline & Pipe Services REPORTING SEGMENTS

Supportive Long-Term Fundamentals

Business Segment 2020 Focus

• Expansion
• Products
• Markets
• Added value
• Services
• Digital

COMPOSITE SYSTEMS Growing acceptance and established base business will drive high growth

• Bid, win and

execute

• Technology

monetization

• Optimized footprint

PIPELINE & PIPE SERVICES International & offshore projects expected to improve profitability in 2020 and beyond

• Product approvals

and specifications

• Global capacity
• Equipment and

aftermarket service

AUTOMOTIVE & INDUSTRIAL Stable outlook with growth prospects in core markets

• Global oil and gas

development to meet demand profile

• Energy transition –

move to alternatives with a lower carbon footprint

• Aging infrastructure,

strict replacement requirements and

• wnership

accountability

• Significant investments

required to address source and end-use imbalances in Water, Oil & Gas and Electricity

• Investments required to

develop national resources and supply chain security

Fundamentals

7

Clear Priorities

• Managing Supply Chain and

Customer Schedules

• Physical Distancing, Site

Containment and Hygiene Protocols

• Implementation of Remote

Work

Ensure Customer Project Execution Ensure Employee Safety

• Employee Monitoring and

Separation

• Visitor and Travel Restrictions
• Best Practice Return to Office

Standards

Immediate Cost Reductions

• Suspended Dividend

commencing Q2 ‘20

• Reduced Board, CEO and

Executive Compensation

• Reduced Salaried Workforce

(>15%)

• Controlled Closures of Select

Pipe Coating Facilities and Branch Offices

Capital Management

• Amended Credit Facility with

Covenant Relief to End of

• Dec. ‘21
• Reduced Capital Spending to

$40-$50M Range

• Reduced Working Capital
• Leveraged HSE strength of

the Company

• Significant Progress on

Financial Targets

• $60M in Sustainable

Annualized SG&A Savings

• $40M in Incremental

Cash Generation

• $70M Normalized SG&A

Run Rate

• As of June 30, 2019, $104M

in Cash and $297M in Undrawn Credit Facilities

Highlights

8

Significant Secured and Visible Work

END OF Q2 2020 $ 553 M $ 1,400 M

Backlog Bid Budgetary

$ 790 M

$ 180 M

• 12-month Backlog > $500 million
• Conditional Bid awards ~ $180 million
• Q2 secured work reflects updated Project timing

National Bank Financial

Energy Conference

+

S O L U T I O N S M A T T E R

September 2, 2020