NINE ENERGY SERVICE CREDIT SUISSE CONFERENCE FEBRUARY 2019 1 - PowerPoint PPT Presentation

NINE ENERGY SERVICE CREDIT SUISSE CONFERENCE FEBRUARY 2019 1

DISCLAIMER Forward-Looking Statements & Non-GAAP Financial Measures Certain statements in this presentation are forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. All statements, other than statements of historical fact included in this presentation, regarding our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects, plans and objectives of management are forward-looking statements. When used in this presentation, the words “could,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “may,” “continue,” “predict,” “pote nti al,” “project” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Forward- looking statements may include statements about the volatility of future oil and natural gas prices; our ability to successfully manage our growth, including risks and uncertainties associated with integrating and retaining key employees of the businesses we acquire; availability of skilled and qualified labor and key management personnel; our ability to accurately predict customer demand; competition in our industry; governmental regulation and taxation of the oil and natural gas industry; environmental liabilities; our ability to implement new technologies and services; availability and terms of capital; general economic conditions; operating hazards inherent in our industry; our financial strategy, budget, projections, operating results, cash flows and liquidity; and our plans, business strategy and objectives, expectations and intentions that are not historical. Although we believe that our plans, intentions and expectations reflected in or suggested by the forward-looking statements contained herein are reasonable, we can give no assurance that these plans, intentions or expectations will be achieved. For additional information regarding known material factors that could affect our operating results and performance, please see our final IPO prospectus, Current Reports on Form 8-K, Annual Report on Form 10-K and Quarterly Reports on Form 10- Q which are available at the SEC’s website , http://www.sec.gov. Should one or more of these known material risks occur, or should the underlying assumptions change or prove incorrect, our actual results, performance, achievements or plans could differ materially from those expressed or implied in any forward-looking statement. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. All subsequent written or oral forward-looking statements concerning us are expressly qualified in their entirety by the cautionary statements above. We undertake no obligation to publicly update or revise any forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise, except as required by law. All information in this presentation is as of September 30, 2018 or December 31, 2017 as indicated unless otherwise noted. In addition to reporting financial results in accordance with GAAP, the Company has presented Adjusted EBITDA, Adjusted EBITDA margin and return on invested capital (ROIC). These are not recognized measures under, or an alternative to, GAAP. The Company’s management believes that this presentation provides useful information to management, analysts and investors regarding certain additional financial and business trends relating to its results of operations and financial condition. In addition, management uses these measures for reviewing the financial results of the Company. These non-GAAP measures are intended to provide additional information only and do not have any standard meaning prescribed by GAAP. Use of these terms may differ from similar measures reported by other companies. In particular, because of its limitations, Adjusted EBITDA should not be considered as a measure of discretionary cash available to use to reinvest in growth of the Company’s business, or as a measure of cash that will be ava ila ble to meet the Company’s obligations. These non-GAAP measures have limitations as an analytical tool, and you should not consider them in isolation or as a substitute for analysis of the Company’s results as reported under GAAP . Industry and Market Data This presentation includes market data and other statistical information from third party sources, including independent industry publications, government publications and other published independent sources. Although the Company believes these third party sources are reliable as of their respective dates, the Company has not independently verified the accuracy or completeness of this information. 2

COMPANY OVERVIEW

NINE COMPANY OVERVIEW OUR COMPANY Focused on ROIC • Leveraged to increasing completion intensity including mega-well pads, lateral lengths and stage count • Super lateral, deep reach capable service offering and focus • Agnostic to completion style – plug and perf (94% 1 of horizontal market) and sleeve completions (6% 1 of horizontal market) • Able to provide downhole conveyance services coupled with forward-leaning technology • Diversified completion portfolio and geography • PRO FORMA FINANCIAL OVERVIEW ($MM) 2 PRO FORMA REVENUE BY SERVICE LINE 3 $903 Cementing Completion Tools 21% 26% $633 Adj. Adj. EBITDA EBITDA Margin Margin 18% 13% Well Service Coiled Tubing $161 9% 19% $84 2017 H1 2018 Annualized Wireline 25% Revenue Adj. EBITDA 1 Spears and Associates. 2 Revenue and Adjusted EBITDA pro forma to include Magnum. Calculations are based on Nine’s historical consolidated financial statements and Magnum’ s historical consolidated 4 financial statements as adjusted to give effect to Nine’s acquisition of Magnum and the related financing transactions. H1 20 18 represent annualized figures.; 3 Financials based on H1 2018 revenue and pro forma for Magnum acquisition. Blue color indicates Completion Solutions segment. See appendix for Adjusted EBITDA reconciliation

NINE’S UNIQUE STRATEGY Returns (ROIC) Sustainability Cash flow generative Mitigation of financial risk Capital Light Capital Intensity Customer Legitimacy Wellsite Execution R&D Real-time information 5

DRIVING VALUE FOR CONSTITUENTS CUSTOMERS Ability to decrease cost to complete and increase EUR EMPLOYEES INVESTORS Socioeconomic Financial movement & career Sustainability progression & Returns 6

TECHNOLOGY-DRIVEN COMPLETIONS OFFERING Nine is capable of addressing 100% of the onshore wells drilled in North America, regardless of completion type PRE & POST STIMULATION HORIZONTAL LATERAL TOE OF THE WELL Large Diameter Coil + Memory Tools Long-string Cementing Offering includes tools & equipment capable of Extremely reliable in super completing super laterals (10,000 ft.+) laterals (10,000 ft.+) Proprietary Liner Hanger Tools Scorpion Composite Plug – EON Ball Drop Sleeve System – SmartStart – Strategic alliance Owned IP Strategic Alliance MagnumDisk TM - Owned IP Coil Activated Frac Sleeve – MVP TM & Hollow Point TM Dissolvable – FlowGun – Owned IP Strategic Alliance Owned IP Breakthru TM Casing Flotation Device - Owned IP MorphPackers Storm TM Re-frac Packer – Strategic Alliance 2019E New NA HZ Wells Drilled: 22,291 1 2019E NA Stage Count: 699,377 1 2019E New NA HZ Wells Drilled: 22,291 1 1 Spears & Associates, Q4 2018. 7

PREMIER ISOLATION TOOL PROVIDER Able to serve the entire addressable isolation tool (isolation tool = plug) market with proven dissolvable • and composite offerings (1 frac stage = 1 plug) 2019E NA Stage Count: 699,377 1 • # 2 market share in dissolvable frac plugs and #1 in polymer-based (plastic) dissolvable plugs • COMPOSITE FRAC PLUGS DISSOLVABLE FRAC PLUGS · Fully composite · Completely dissolvable eliminating plug drill-out · Shorter design, minimizing bit wear and tear and resulting · Applications to address temperatures in all NAM basins in faster drill-out times · Plastic and Magnesium offering · Variety of sizes (3.5” - 5.5”) including extended range HIGH TEMP MVP TM Eagles Ford, Haynesville, Duvernay SCORPION TM COMPOSITE PLUGS All Basins MID TEMP MVP TM Permian, Bakken, Midcon, DJ/Niobrara, Duvernay, Montney EXTENDED RANGE PLUGS LOW TEMP MVP TM (Plastic) For Challenging or Impaired Casing Permian, Marcellus/Utica, Fayetteville, Montney LOW TEMP Hollow Point TM (Magnesium) Permian, Marcellus/Utica, Fayetteville 1 Spears & Associates, Q4 2018. 8

INTEGRATED COMPLETIONS SOLUTION NINE CAN HELP OPERATORS DESIGN AND EXECUTE THE MOST COST-EFFICIENT AND PRODUCTIVE DEEP-REACH LATERALS THROUGH BROAD OFFERING OF COMPLETION TOOL PORTFOLIO ILLUSTRATIVE HYBRID WELLBORE SOLUTION FlowGun ™ Toe Valve • Eliminates intervention Breakthru™ Casing Flotation Device • Reduces cycle time up to 4+ days Ensures casing reaches bottom in ultra-long laterals • Eliminates debris sub allowing more access to lateral • Magnum TM Dissolvable Plugs • Extends lateral & eliminates intervention Scorpion ™ Composite Plugs • De-risks/eliminates coil operation • Eliminates drill bit trips & reduces cycle time 2+ days • Reduces cycle time up to 4+ days • De-risks coil operation with fully composite materials • Mitigates parent child/well interference • Lower cost option verses dissolvables • Reduces footprint at surface 9