Corporate Update
March 2024
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Forward-Looking Statements
Certain statements set forth in this presentation constitute forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934) regarding Flotek Industries, Inc.'s business, financial condition, results of operations and prospects. Words such as will, continue, expects, anticipates, intends, plans, believes, seeks, estimates and similar expressions or variations of such words are intended to identify forward-looking statements, but are not the exclusive means of identifying forward-looking statements in this presentation. Although forward-looking statements in this presentation reflect the good faith judgment of management, such statements can only be based on facts and factors currently known to management. Consequently, forward-looking statements are inherently subject to risks and uncertainties, and actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. Further information about the risks and uncertainties that may impact the Company are set forth in the Company's most recent filing with the Securities and Exchange Commission on Form 10-K (including, without limitation, in the "Risk Factors" section thereof), and in the Company's other SEC filings and publicly available documents. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this presentation. The Company undertakes no obligation to revise or update any forward-looking statements in order to reflect any event or circumstance that may arise after the date of this presentation.
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Compelling Investment Opportunity
RETURN TO PROFITABILITY UNDERSCORES TURNAROUND EXECUTION
Market leading Oil & Gas prescriptive chemistry solutions
- Sustained growth in US and international O&G completion chemistry
- Industry leading technology improving BOE uplift by +26%
- Long-termcontracted chemistry volumes mitigates impact of industry volatility
Market disrupting real-time measurement technology
- Data analytics segment expected to grow associated revenues over 50% in 2024
-
Release of next generation analyzer provides scale and new market opportunities
Leadership team with deep industry expertise to execute rapid growth strategy
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Company Overview
Founded: | 1985 | |
Employees: | 143 | |
Corporate Headquarters: | Houston | |
Countries with Clients: | 59 | |
Patents: | >170 | |
Debt (12.31.23) ($mm): | $7.5 | |
Headquarters | FY 2023 Gross Profit Margin: | 13% |
Field Office | ||
FTK Global Presence |
A Purpose-Driven Company
Who We Are
An advanced technology-driven, green chemical and data analytics company providing unique and innovative completion solutions
Our Vision
We strive to be the collaborative partner of choice for solutions that reduce the environmental impact of energy on air, water, land and people
Value Proposition
We collaborate and deliver sustainable, optimized chemistry and data solutions that maximize our customers' value
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Our completion solutions have a positive impact on sustainability and reducing the overall environmental impact of energy on air, land, water and people
Our Strategic Priorities
Industry-Leading Innovation
Track record of delivering fit-for-purpose optimized chemistry and data solutions
Sustainable Revenue Growth
10-year contracted chemistry volumes with significant market expansion opportunities
Enhanced Profitability
Generated a $27.7 million improvement in Adjusted EBITDA** year over year
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Expand Global Footprint
Sustainable growth in international chemistry revenues and data analytics
Strong Balance Sheet
Minimal debt and strengthened liquidity with ABL* facility
Environmental Leadership
Focus on reducing impact of energy on air, land, water, and people
- Asset Based Loan
- Adjusted EBITDA is a non-GAAP measure. See the Appendix in this presentation for a reconciliation to the nearest GAAP measure.
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2023 Highlights: Improvement in Performance
TRANSFORMATIVE YEAR WITH SIGNIFICANT GROWTH IN ALL PROFITABILITY METRICS
- Delivered year-over-year growth:
• | Revenue: | $52.0 million |
• | Gross profit: | $31.0 million |
- Adj. EBITDA*: $27.7 million
- Full year adj. EBITDA* was positive for the first time since 2017
- Revenues associated with external customers grew each quarter
- Data analytics revenues grew 47% compared to 2022
- Strengthened liquidity through an up to $13.8 million ABL**
- Material weakness and going concern issues identified in connection with the 2022 audit are expected to be resolved
Poised to deliver sustained growth and further market share gains through chemistry and emerging data analytics upstream market
- Adjusted EBITDA is a non-GAAP measure. See the Appendix in this presentation for a reconciliation to the nearest GAAP measure. ** Asset Based Loan
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Strong Revenue Performance
TRANSFORMATIVE YEAR WITH SIGNIFICANT GROWTH IN ALL PROFITABILITY METRICS
Annual Segmented Revenue ($MM) | External Chemistry Revenue ($MM) | |||||||||||||||||||||||
$200.0 | $8.1 | $20.0 | ||||||||||||||||||||||
$18.0 | ||||||||||||||||||||||||
$180.0 | $18.0 | $16.3 | ||||||||||||||||||||||
$160.0 | $15.5 | |||||||||||||||||||||||
$59.0 | $16.0 | |||||||||||||||||||||||
$140.0 | $5.5 | $14.0 | ||||||||||||||||||||||
$120.0 | ||||||||||||||||||||||||
$12.0 | ||||||||||||||||||||||||
$100.0 | $49.0 | $10.0 | $9.2 | |||||||||||||||||||||
$80.0 | $120.9 | $8.0 | ||||||||||||||||||||||
$60.0 | $4.3 | $6.0 | ||||||||||||||||||||||
$40.0 | $81.6 | $4.0 | ||||||||||||||||||||||
$20.0 | $40.0 | $2.0 | ||||||||||||||||||||||
$- | $- | |||||||||||||||||||||||
2021 | 2022 | 2023 | Q1 | Q2 | Q3 | Q4 | ||||||||||||||||||
ProFrac Chem.* | External Chem. | Data Analytics | 2023 | |||||||||||||||||||||
* ProFrac Chem. reflects 'Chemistry Only' revenues
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Delivering Rapid Improvement in Gross Profit
TRANSFORMATIVE YEAR WITH SIGNIFICANT GROWTH IN ALL PROFITABILITY METRICS
Quarterly Consolidated Gross Profit (Loss) (000's)
$10,000 | |||||||
$7,500 | |||||||
$5,000 | |||||||
$2,500 | |||||||
$0 | |||||||
($2,500) | |||||||
1Q22 | 2Q22 | 3Q22 | 4Q22 | 1Q23 | 2Q23 | 3Q23 | 4Q23 |
- 4Q 2023 gross profit was positive for the fourth consecutive quarter
- Delivered a $31.0 million increase in 2023 gross profit compared to 2022
- Long- term contracted chemistry volumes protects against lower frac fleet activity
- Delivered efficiencies across all aspects of business supply chain
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Strong Financial Momentum Continues
TRANSFORMATIVE YEAR WITH SIGNIFICANT GROWTH IN ALL PROFITABILITY METRICS
Quarterly Adjusted EBITDA*/Revenue | ||||||||||
20% | ||||||||||
10% | • 2023 adj. EBITDA* increased $27.7 | |||||||||
0% | ||||||||||
-10% | million over 2022 | |||||||||
-20% | • 4Q 2023 was the tenth consecutive | |||||||||
-30% | ||||||||||
quarter of improvement | ||||||||||
-40% | ||||||||||
-50% | • 2023 was the first full year of positive | |||||||||
-60% | adj. EBITDA since 2017 | |||||||||
-70% | ||||||||||
-80% | ||||||||||
2Q21 | 3Q21 | 4Q21 | 1Q22 | 2Q22 | 3Q22 | 4Q22 | 1Q23 | 2Q23 | 3Q23 | 4Q23 |
* Adjusted EBITDA is a non-GAAP metric. See the Appendix in this presentation for a reconciliation to nearest GAAP measure
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Flotek Industries Inc. published this content on 12 March 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 12 March 2024 20:20:38 UTC.