energy & power - harris williams & co....chris burnham | vice president ... psc, llc, a...
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www.harriswilliams.com
Investment banking services are provided by Harris Williams LLC, a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co. Ltd, which is authorised andregulated by the Financial Conduct Authority. Harris Williams & Co. is a trade name under which Harris Williams LLC and Harris Williams & Co. Ltd conduct business.
ENERGY & POWER
0
INDUSTRY UPDATE │ JANUARY 2015
PAGE |
www.harriswilliams.com
SUMMARY
1
CONTENTS
WHAT WE’RE READING
M&A TRANSACTIONS
PUBLIC MARKETS INDUSTRY
PUBLIC COMPARABLES
CONTACTS
UNITED STATES
Andrew Spitzer | Managing Director [email protected] +1 (804) 915-0174
Brian Lucas | Managing Director [email protected] +1 (804) 932-1323
Matthew White | Director [email protected] +1 (804) 915-0131
Luke Semple | Director [email protected] +1 (804) 915-0158
Chris Burnham | Vice President [email protected] +1 (804) 915-0142
Ian Thomas | Vice President [email protected] +1 (804) 932-1384
EUROPE
Julien Darmon | Managing Director [email protected] +44 (0) 20 7518 8900
Jeffery Perkins | Managing Director [email protected] +49 (0) 69 3650638 00
M&A | SELECT RECENT ACTIVITY
Flogistix, a portfolio company of Natural Gas Partners and NGP Energy Technology Partners, has been acquired by White Deer Energy. Flogistix is a provider of technology-enabled production optimization equipment and services for the oil & gas industry. HW&Co. advised Flogistix, NGP, and NGP Energy Technology Partners on the transaction. Source| Instapaper
Tyco has agreed to acquire Industrial Safety Technologies, a portfolio company of Battery Ventures, for approximately $330 million. Industrial Safety Technologies is a manufacturer of gas and flame detection products. Source| Instapaper
Newalta Corporation’s Industrial Services Division has been acquired by Birch Hill Equity Partners for $258 million. The Company is a provider of industrial and environmental services for a variety of energy related end markets. Source| Instapaper
Tervita’s Waste Processing Division has been acquired by Republic Services for $485 million. The Company is a provider of environmental waste solutions for the upstream oil and gas industry. Source| Instapaper
PSC, LLC, a portfolio company of Lindsay Goldberg, has been acquired by Littlejohn & Co. PSC is a leading provider of industrial maintenance, cleaning, and engineered services across the energy value chain. Harris Williams & Co. advised PSC and Lindsay Goldberg on the transaction.Source| Instapaper
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
PUBLIC MARKETS | KEY TRADING STATISTICS
Stock Price % Change TEV / EBITDA
1 Month 12 Month Dec-13 Jul-14 Current 2014E 2015P
Energy Services and Equipment
Large Cap Service (4.2%) (13.9%) 9.2x 11.3x 6.9x 5.8x 6.0x
Equipment (2.4%) (21.5%) 11.5x 12.0x 7.7x 7.7x 7.3x
Small-Cap Service (12.0%) (45.0%) 8.6x 11.9x 5.4x 5.1x 5.2x
OCTG (17.0%) (49.5%) 8.2x 7.3x 5.7x 6.1x 6.0x
Distribution (14.5%) (53.0%) 11.1x 11.6x 9.5x 9.0x 8.4x
Logistics (3.7%) (45.3%) 10.7x 9.1x 6.3x 6.8x 6.7x
Offshore Drillers (11.4%) (47.6%) 7.6x 7.2x 4.7x 4.9x 5.2x
Land Drillers (6.2%) (30.8%) 5.1x 7.4x 4.2x 4.1x 4.1x
E&C (15.1%) (46.5%) 8.0x 8.2x 4.7x 4.8x 4.2x
Power Services and Equipment
Large Cap PS&E (4.3%) (11.4%) 11.5x 10.9x 10.6x 9.8x 9.3x
Small-Cap PS&E 2.9% (2.9%) 11.8x 11.7x 10.9x 11.0x 10.0x
EE and Cleantech 4.7% (20.9%) 13.6x 13.4x 10.4x 11.2x 11.0x
Industrial & Infrastructure Services
Large Cap (0.9%) (26.0%) 10.4x 8.8x 6.5x 8.8x 6.1x
Small-Cap 2.5% (12.8%) 10.4x 12.0x 9.4x 8.4x 6.2x
Utility Services 0.8% 0.8% 7.5x 8.1x 8.0x 7.6x 6.2x
Industrial Services 4.0% (12.2%) 10.1x 10.8x 8.0x 9.0x 7.1x
Engineering Services (0.6%) (2.9%) 12.4x 9.9x 11.6x 10.5x 8.2x
TEV / LTM EBITDA as of
PAGE |
WHAT WE’RE READING
The Wall Street Journal examines the recent collapse in oil prices, tracing the plunge back to 2008 near Colutta, TX.This is where the first well was drilled into the Eagle Ford Shale. At the time, the U.S. pumped only 4.7 million barrels ofcrude oil per day.The Wall Street Journal | Instapaper
2
OIL & GAS | HOW CRUDE OIL’S GLOBAL COLLAPSE UNFOLDED
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
A summary of interesting industry articles we have come across in the past month.
Looking beyond the near-term market headlines, ExxonMobil recently published its annual global view of energysupply and demand, “The Outlook for Energy: A View to 2040.” The report looks at all major issues shaping the world’senergy future.ExxonMobil
ENERGY| EXXONMOBIL 2015 ENERGY OUTLOOK
GigaOM reports that during the first three quarters of 2014, more than one third (36 percent) of the new electricitycapacity built out in the U.S. came from solar systems. The price of solar panels is at its cheapest in history, and newtypes of financing have emerged to help boost solar panel installations on the rooftops of homes and businessesGigaOM | Instapaper
SOLAR | SOLAR DRIVING NEW ELECTRICITY
Bloomberg New Energy Finance reviews the impact of the plunge in oil price on clean energy deployment. While the45% fall in oil prices has been portrayed as a big blow to clean energy, its impact will be modest in major electricitymarkets, which benefit from stable policy support.BNEF | Instapaper
POWER | EMPLOYMENT DROPS IN POWER SEGMENTS
The Proceedings of the National Academy of Sciences reports that many all-electric and ethanol fueled vehicles areworse for the environment than gasoline powered cars. In environments with coal-generated power, these vehiclesare polluting the air more and contributing to global warming. If powered by coal-produced electricity, electric carsincrease monetized environmental heath impacts by 80% more than those powered by gasoline.PNAS | Instapaper
ENERGY EFFICIENCY| ALL-ELECTRIC CARS MAY NOT BE SO GREEN
Nature writes that the United States is mistakenly banking on decades of abundant natural gas to power its economicresurgence. Researchers have developed new, granular production models for the largest natural gas formations andare issuing much more-conservative output forecasts than those suggested by the EIA.Nature | Instapaper
OIL & GAS | THE FRACKING FALLACY
Greentech Media reports that the demand response challenge of the decade now awaits a Supreme Court decision.The case has evolved into a pending showdown over the extent to which federal and state regulators can or can’tallow demand, that is, anything on the customer side of the power meter, to participate in grid affairs.Greentech Media | Instapaper
UTILITIES | THE FUTURE OF DEMAND RESPONSE
In a letter to investors, Howard Marks writes about what consumers and investors can learn from the most recent oilprice crash. Marks suggests the current market presents an appropriate opportunity for increased aggressiveness.Oaktree Capital Management | Instapaper
OIL & GAS | THE LESSONS OF OIL
PAGE |
M&A TRANSACTIONS
3
RECENT M&A TRANSACTIONS1,2
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
Date Target Business Description Acquirer
12/23/2014 Newalta Corporation,
Industrial Div ision
CA based provider of industrial and environmental serv ices for a
variety of industrial end markets in Canada and internationally.
Birch Hill Equity Partners
12/23/2014 Navigator Energy Serv ices US based provider of midstream infrastructure solutions to oil and gas
producers in the US.
First Reserve Corporation
12/19/2014 Terv ita Waste Processing US based provider of treating, recovering, and disposing serv ices for
petroleum products in the US.
Republic Serv ices, Inc.
12/17/2014 Cimarron Energy Inc US based provider of oil and gas production and safety equipment for
the upstream energy industry.
Turnbridge Capital
12/16/2014 Titan Technologies
International
US based manufacturer and provider of industrial bolting tools
internationally.
Atlas Copco
12/15/2014 Pfaudler US based manufacturer of steel reactors, corrosion resistant equipment,
and process systems for a variety of industrial end markets.
Deutsche Beteiligungs
12/14/2014 Dessau CEI Colombia based provider of engineering consultancy serv ices to the
transportation, energy, water, and oil and gas industries.
WSP Global
12/12/2014 Flogistix US based provider of technology-enabled production optimization
equipment and serv ices for the oil & gas industry.
White Deer Energy
12/11/2014 Charter Brokerage US based provider of a variety of global trade serv ices internationally. Berkshire Hathaway
12/11/2014 Advance Fabrication US based provider and manufacturer of gas measurement tools and
oilfield equipment.
KW International
12/10/2014 Industrial Safety
Technologies
US based provider of industrial safety solutions for the oil and gas,
chemical, and shipping industries.
TYCO International
12/9/2014 Thigpen Energy US based provider of natural gas fueling solutions in North America. Intervale Capital
12/4/2014 PSC, LLC US based provider of industrial maintenance, cleaning, and engineered
serv ices across the energy value chain.
Littlejohn & Co., LLC
12/3/2014 Beck Disaster Recovery US based provider of program management serv ices for emergency
preparedness and recovery.
Tetra Tech
12/2/2014 Pulse Energy Canada based provider of energy management software for
commercial and industrial industries.
EnerNOC
12/2/2014 Hoover Container
Solutions
US based renter and provider of intermediate bulk containers, offshore
containers, and tanks for the oil and gas industry.
First Reserve Corporation
12/1/2014 Thunder & Lightning
Welding
Canada based provider of design and fabrication of oilfield equipment. Hyduke Energy Serv ices
12/1/2014 Weatherford, Engineered
Chemistry & Drilling Fluids
Assets
US based provider of chemical treatments for oil and gas production
and produced waters as well as additives for drilling, workover, and
stimulation operations.
Lubrizol
PAGE |
PUBLIC MARKETS
4
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
Energy Equipment and Services
TEV / LTM EBITDA TEV / 2014E EBITDA
AVERAGE REVENUE GROWTH (2011 – 2013) AVERAGE REVENUE GROWTH (2013 – 2015P)
AVERAGE EBITDA MARGIN (2011 – 2013) AVERAGE EBITDA MARGIN (2013 – 2015P)
4.2x
4.7x
4.7x
5.4x
5.7x
6.3x
6.9x
7.7x
9.5x
Land Drillers
Offshore Drillers
E&C
Small Cap Service
OCTG
Logistics
Large Cap Service
Equipment
Distribution
2.1%
5.2%
7.0%
8.7%
10.7%
11.3%
18.5%
20.1%
32.9%
OCTG
E&C
Land Drillers
Large Cap Service
Small Cap Service
Logistics
Equipment
Offshore Drillers
Distribution
(1.2%)
2.8%
3.4%
3.8%
5.0%
6.1%
7.7%
11.2%
14.4%
OCTG
E&C
Equipment
Offshore Drillers
Distribution
Large Cap Services
Logistics
Land Drillers
Small Cap Service
4.1x
4.8x
4.9x
5.1x
5.8x
6.1x
6.8x
7.7x
9.0x
Land Drillers
E&C
Offshore Drillers
Small Cap Service
Large Cap Service
OCTG
Logistics
Equipment
Distribution
6.7%
11.5%
18.9%
20.5%
20.8%
22.9%
31.9%
33.8%
42.4%
Distribution
E&C
OCTG
Equipment
Large Cap Service
Small Cap Service
Land Drillers
Logistics
Offshore Drillers
6.6%
10.4%
18.7%
19.4%
20.9%
21.6%
31.6%
34.2%
42.0%
Distribution
E&C
OCTG
Small Cap Service
Equipment
Large Cap Service
Land Drillers
Logistics
Offshore Drillers
PAGE |
PUBLIC MARKETS CONT.
5
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
Power Equipment and Services
TEV / LTM EBITDA TEV / 2014E EBITDA
AVERAGE REVENUE GROWTH (2011 – 2013) AVERAGE REVENUE GROWTH (2013 – 2015P)
AVERAGE EBITDA MARGIN (2011 – 2013) AVERAGE EBITDA MARGIN (2013 – 2015E)
9.8x
11.0x
11.2x
Large Cap
Mid and Small-Cap
EE and Cleantech
10.4x
10.6x
10.9x
EE and Cleantech
Large Cap
Mid and Small-Cap
3.9%
9.4%
21.4%
Large Cap
Mid and Small-Cap
EE and Cleantech
(2.9%)
7.0%
13.4%
Large Cap
Mid and Small-Cap
EE and Cleantech
(13.4%)
16.0%
16.8%
EE and Cleantech
Large Cap
Mid and Small-Cap
(8.7%)
15.8%
17.4%
EE and Cleantech
Large Cap
Mid and Small-Cap
PAGE |
PUBLIC MARKETS CONT.
6
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
Infrastructure Services
TEV / LTM EBITDA TEV / 2014E EBITDA
AVERAGE REVENUE GROWTH (2011 – 2013) AVERAGE REVENUE GROWTH (2013 – 2015P)
AVERAGE EBITDA MARGIN (2011 – 2013) AVERAGE EBITDA MARGIN (2013 – 2015P)
6.5x
8.0x
8.0x
9.4x
11.6x
Large Cap
Utility Services
Industrial
Services
Mid and Small-
Cap
Engineering Svc
7.6x
8.4x
8.8x
9.0x
10.5x
Utility Services
Mid and Small-
Cap
Large Cap
Industrial Services
Engineering Svc
8.9%
11.0%
14.1%
19.7%
21.0%
Mid and Small-
Cap
Large Cap
Industrial Services
Engineering Svc
Utility Services
4.9%
7.3%
7.7%
11.0%
19.8%
Large Cap
Utility Services
Mid and Small-
Cap
Industrial Services
Engineering Svc
6.2%
7.3%
8.3%
9.4%
10.2%
Mid and Small-Cap
Large Cap
Industrial Services
Utility Services
Engineering Svc
7.2%
7.8%
7.9%
10.1%
10.6%
Mid and Small-Cap
Industrial Services
Large Cap
Utility Services
Engineering Svc
PAGE |
INDUSTRY STATISTICS
7
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
(Indexed to 100%)
TRAILING TWELVE MONTHS
Commodity Prices
Price Change From
Current Prior Month Prior Year Prior Month Prior Year
Natural Gas ($ per MMBtu) $2.90 $4.36 $4.19 (33.5%) (30.9%)
Crude Oil ($ per bbl) 53.27 73.69 98.42 (27.7%) (45.9%)
Coal (CAPP) ($ per ton) 51.10 54.00 58.04 (5.4%) (12.0%)
25%
50%
75%
100%
125%
150%
12/31/13 3/31/14 6/30/14 9/30/14 12/31/14
Natural Gas (NYMEX:^NG) Crude Oil (NYMEX:^CL) Coal (NYMEX:^QL)
PAGE |
INDUSTRY STATISTICS
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
U.S. RIG COUNTS INTERNATIONAL RIG COUNTS
Rig Counts3
INTERNATIONAL RIG COUNT BY COUNTRY
U.S. OIL VS. GAS RIG COUNT
U.S. HORIZONTAL/DIRECTIONAL VS. VERTICAL RIG COUNT
0
500
1,000
1,500
2,000
2,500
'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14
Oil
Gas
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14
Horizontal / Directional
Vertical
400
600
800
1,000
1,200
1,400
'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14
42
48
52
113
45
83
-
94
97
142
298
292
North Sea
Africa
Europe
Asia Pacific
Middle East
Latin America
Offshore Land
8
PAGE |
INDUSTRY STATISTICS
9
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
U.S. OIL RIG COUNT BY REGION U.S. GAS RIG COUNT BY REGION
Rig Counts3
cont.
% YTD CHANGE IN U.S. OIL RIG COUNT BY REGION % YTD CHANGE IN U.S. GAS RIG COUNT BY REGION
375
0
0
0
2
6
15
24
28
42
42
43
72
178
188
527
Others
Arkoma Woodford
Fayetteville
Marcellus
Haynesville
Ardmore Woodford
Barnett
Utica
Granite Wash
Cana Woodford
DJ-Niobrara
Gulf of Mexico
Mississippian
Williston
Eagle Ford
Permian
17%
(42%)
(40%)
(7%)
(6%)
(4%)
0%
0%
0%
9%
15%
35%
41%
48%
100%
100%
Others
Granite Wash
Ardmore Woodford
Eagle Ford
Barnett
Williston
Arkoma Woodford
Fayetteville
Marcellus
Mississippian
Permian
DJ-Niobrara
Utica
Gulf of Mexico
Haynesville
Cana Woodford
102
0
0
1
5
6
8
9
9
13
16
18
24
26
38
78
Others
Mississippian
Ardmore Woodford
Williston
Arkoma Woodford
Cana Woodford
Permian
Fayetteville
Barnett
Gulf of Mexico
Eagle Ford
DJ-Niobrara
Granite Wash
Utica
Haynesville
Marcellus
(8%)
(100%)
(60%)
(50%)
(36%)
(32%)
(11%)
(10%)
(8%)
(5%)
0%
0%
0%
0%
24%
500%
Others
Mississippian
Cana Woodford
Barnett
Eagle Ford
Gulf of Mexico
Permian
Haynesville
Marcellus
DJ-Niobrara
Williston
Ardmore Woodford
Arkoma Woodford
Fayetteville
Utica
Granite Wash
PAGE |
INDUSTRY STATISTICS CONT.
10
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
U.S. LAND WELLS U.S. LAND WELLS PER RIG
Well Counts3
WELL COUNT CHANGE FROM PRIOR QUARTER WELL COUNT CHANGE FROM PRIOR YEAR
23
(27)
(18)
(12)
(3)
(2)
5
7
8
16
18
20
30
45
Others
Eagle Ford
Ardmore Woodford
Mississippian
Marcellus
Fayetteville
Barnett
Arkoma Woodford
Utica
Haynesville
Granite Wash
Cana Woodford
Permian
DJ-Niobrara
Williston
210
(118)
(52)
(38)
(30)
(22)
(8)
12
14
23
24
54
72
350
Others
Barnett
Ardmore Woodford
Williston
Marcellus
Fayetteville
Utica
Mississippian
Granite Wash
Cana Woodford
Haynesville
Arkoma Woodford
DJ-Niobrara
Eagle Ford
Permian
9,011 9,075 9,083
8,966
9,456
9,566
Q2 '13 Q3 '13 Q4 '13 Q1 '14 Q2 '14 Q3 '14
4.7
5.0
5.1
4.9
5.0
5.35.3
5.4
5.25.3
5.2
Q1'12
Q2'12
Q3'12
Q4'12
Q1'13
Q2'13
Q3'13
Q4'13
Q1'14
Q2'14
Q3'14
PAGE |
OUR GROUP
Harris Williams & Co. is a leading advisor to the energy and power M&A market. Our Energy & Power Group hasexperience across a broad range of sectors, including services, products, and technologies that support or enhanceenergy and power infrastructure.
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
SELECT RELEVANT EXPERIENCE
Oil & Gas Equipment and Services
Coal Products and Services
Energy
Power Products and Technology
Electric and Natural Gas Transmission and Distribution
Energy Efficiency and Clean Technology
Renewable Energy Services and Equipment
Power SELECT RELEVANT EXPERIENCE
Industrial and Infrastructure Services
Engineering and Construction
Environmental Services
Infrastructure SELECT RELEVANT EXPERIENCE
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Transportation & Logistics
Aerospace, Defense & Government
Services
IndustrialsBusiness Services
Building Products & Materials
Energy & Power
Technology, Media & Telecom
Specialty Distribution
Healthcare & Lifesciences
Consumer
PAGE |
HARRIS WILLIAMS & CO. OFFICE LOCATIONS
Energy & Power
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UNITED STATES EUROPE
OUR GROUP
Harris Williams & Co. has a broad range of industry expertise, which create powerful opportunities.Our clients benefit form our deep-sector experience, integrated industry intelligence andcollaboration across the firm, and our commitment to learning what makes them unique. For moreinformation, visit our website at www.harriswilliams.com/industries
BostonTwo International Place24th FloorBoston, Massachusetts 02110Phone: +1 (617) 482-7501Fax: +1 (617) 482-7503
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ENERGY & POWER
ENERGY & POWER
PAGE |
PUBLIC COMPARABLES
13
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
Stock Performance
Stock Price Change from 52-Week TEV / EBITDA EBITDA
TEV Dec-14 Nov-14 Prior Month Prior Year High % of High Dec-13 Jul-14 Current 2014E 2015P
Energy Services and Equipment
Large Cap Service
Schlumberger Limited $116,420 $85.41 $85.95 (0.6%) (5.2%) $118.76 71.9% 10.4x 12.5x 9.0x 8.5x 8.9x
Halliburton Company 39,014 39.33 42.20 (6.8%) (22.5%) 74.33 52.9% 8.2x 10.2x 5.7x 5.4x 5.7x
Baker Hughes Incorporated 27,666 56.07 57.00 (1.6%) 1.5% 75.64 74.1% 7.6x 8.8x 6.5x 6.0x 6.3x
Weatherford International plc 17,076 11.45 13.10 (12.6%) (26.1%) 24.88 46.0% 10.2x 12.4x 7.4x 5.6x 5.7x
Median (4.2%) (13.9%) 62.4% 9.2x 11.3x 6.9x 5.8x 6.0x
Equipment
National Oilwell Varco, Inc. $27,367 $65.53 $67.04 (2.3%) (17.6%) $86.55 75.7% 8.4x 7.7x 5.9x 6.0x 6.1x
Cameron International Corporation 12,912 49.95 51.28 (2.6%) (16.1%) 74.89 66.7% 10.7x 10.9x 7.7x 7.9x 7.6x
FMC Technologies, Inc. 11,809 46.84 47.77 (1.9%) (10.3%) 63.92 73.3% 13.8x 13.0x 9.2x 9.0x 8.4x
Dresser-Rand Group Inc. 7,230 81.80 81.11 0.9% 37.2% 82.95 98.6% 12.6x 14.4x 17.3x 16.4x 14.1x
Oceaneering International, Inc. 6,351 58.81 62.71 (6.2%) (25.4%) 79.13 74.3% 11.3x 10.6x 7.6x 7.4x 7.1x
Dril-Quip, Inc. 2,714 76.73 79.75 (3.8%) (30.2%) 116.53 65.8% 16.2x 14.6x 9.2x 8.9x 8.5x
Oil States International Inc. 2,709 48.90 49.85 (1.9%) (51.9%) 108.05 45.3% 7.4x 4.9x 6.2x 5.9x 6.6x
Forum Energy Technologies, Inc. 2,300 20.73 24.01 (13.7%) (26.6%) 37.03 56.0% 11.7x 13.1x 7.5x 6.6x 6.6x
Median (2.4%) (21.5%) 70.0% 11.5x 12.0x 7.7x 7.7x 7.3x
Mid and Small-Cap Service
Superior Energy Services, Inc. $4,397 $20.15 $19.31 4.4% (24.3%) $37.05 54.4% 5.4x 6.8x 4.0x 3.6x 3.8x
U.S. Silica Holdings, Inc. 1,563 25.69 31.42 (18.2%) (24.7%) 73.43 35.0% 13.4x 18.7x 7.7x 6.3x 5.2x
Ensign Energy Services Inc. 1,975 8.81 9.53 (7.6%) (44.1%) 15.43 57.1% 6.4x 6.5x 4.3x 4.3x 5.2x
Trican Well Service Ltd. 1,329 4.81 6.78 (29.1%) (60.6%) 15.71 30.6% 15.3x 23.8x 8.3x 5.8x 6.6x
Calfrac Well Services Ltd. 1,375 8.64 10.69 (19.2%) (40.8%) 19.49 44.4% 9.8x 11.7x 5.3x 4.6x 5.5x
C&J Energy Services, Inc. 1,057 13.21 15.15 (12.8%) (42.8%) 34.93 37.8% 6.6x 12.1x 5.4x 4.3x 3.8x
Basic Energy Services, Inc. 1,155 7.01 8.93 (21.5%) (55.6%) 29.84 23.5% 6.3x 8.3x 3.9x 3.6x 3.9x
Key Energy Services Inc. 957 1.67 1.88 (11.2%) (78.9%) 10.52 15.9% 7.3x 10.1x 5.6x 6.2x 5.1x
CARBO Ceramics Inc. 895 40.05 38.04 5.3% (65.6%) 156.00 25.7% 15.2x 18.3x 5.4x 5.6x 6.7x
TETRA Technologies, Inc. 1,834 6.68 6.35 5.2% (46.0%) 13.43 49.7% 14.7x 13.9x 20.2x 12.4x 6.9x
Median (12.0%) (45.0%) 36.4% 8.6x 11.9x 5.4x 5.1x 5.2x
OCTG
Tenaris SA $16,402 $15.08 $16.54 (8.8%) (31.0%) $22.14 68.1% 9.1x 9.7x 6.0x 6.2x 6.1x
Vallourec SA 6,073 27.54 33.16 (17.0%) (49.5%) 52.36 52.6% 8.2x 6.7x 5.7x 6.1x 6.0x
OAO TMK 4,098 2.32 5.05 (54.1%) (80.3%) 13.01 17.8% 6.8x 7.3x 5.1x 5.0x 4.8x
Median (17.0%) (49.5%) 52.6% 8.2x 7.3x 5.7x 6.1x 6.0x
Distribution
MRC Global Inc. $2,932 $15.15 $20.21 (25.0%) (53.0%) $32.10 47.2% 11.1x 11.6x 7.5x 6.7x 6.9x
NOW Inc. 2,589 25.73 26.78 (3.9%) NM 37.65 68.3% NM NM 11.6x 11.4x 10.0x
Median (14.5%) (53.0%) 57.8% 11.1x 11.6x 9.5x 9.0x 8.4x
TEV / LTM EBITDA as of
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PUBLIC COMPARABLES CONT.
14
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
Revenue Revenue Growth EBITDA EBITDA Margin Avg. Margin
2011 2012 2013 2014E 2015P '11-13 '13-15P 2011 2012 2013 2014E 2015P 2011 2012 2013 2014E 2015P '11-13 '13-15P
Energy Services and Equipment
Large Cap Service
Schlumberger Limited $36,579 $41,731 $45,266 $48,894 $51,664 11.2% 6.8% $9,633 $10,788 $12,011 $13,773 $14,610 26.3% 25.9% 26.5% 28.2% 28.3% 26.2% 27.7%
Halliburton Company 24,829 28,503 29,402 33,048 35,169 8.8% 9.4% 6,096 6,087 6,038 7,258 8,143 24.6% 21.4% 20.5% 22.0% 23.2% 22.1% 21.9%
Baker Hughes Incorporated 19,831 21,361 22,364 24,416 25,703 6.2% 7.2% 4,236 3,823 3,647 4,708 5,134 21.4% 17.9% 16.3% 19.3% 20.0% 18.5% 18.5%
Weatherford International plc 12,988 15,215 15,263 15,186 15,629 8.4% 1.2% 2,443 2,445 2,054 3,058 3,369 18.8% 16.1% 13.5% 20.1% 21.6% 16.1% 18.4%
Total $94,227 $106,810 $112,295 $121,544 $128,164 8.7% 6.1% $22,408 $23,143 $23,750 $28,797 $31,256 23.8% 21.7% 21.1% 23.7% 24.4% 20.8% 21.6%
Equipment
National Oilwell Varco, Inc. $14,658 $20,041 $22,869 $21,478 $21,599 24.9% (2.8%) $3,492 $4,185 $4,178 $4,557 $4,637 23.8% 20.9% 18.3% 21.2% 21.5% 21.0% 20.3%
Cameron International Corporation 6,959 8,502 9,838 10,600 10,897 18.9% 5.2% 1,119 1,317 1,460 1,640 1,792 16.1% 15.5% 14.8% 15.5% 16.4% 15.5% 15.6%
FMC Technologies, Inc. 5,099 6,151 7,126 7,893 8,565 18.2% 9.6% 670 794 986 1,297 1,461 13.1% 12.9% 13.8% 16.4% 17.1% 13.3% 15.8%
Dresser-Rand Group Inc. 2,312 2,736 3,033 2,976 3,125 14.5% 1.5% 354 427 453 449 524 15.3% 15.6% 14.9% 15.1% 16.8% 15.3% 15.6%
Oceaneering International, Inc. 2,193 2,783 3,287 3,696 3,939 22.4% 9.5% 486 605 747 858 928 22.2% 21.7% 22.7% 23.2% 23.6% 22.2% 23.2%
Dril-Quip, Inc. 601 733 872 924 1,020 20.4% 8.1% 157 188 253 302 326 26.2% 25.6% 29.0% 32.7% 32.0% 26.9% 31.2%
Oil States International Inc. 2,104 2,631 2,670 1,814 1,866 12.6% (16.4%) 634 842 790 443 445 30.1% 32.0% 29.6% 24.4% 23.8% 30.6% 25.9%
Forum Energy Technologies, Inc. 1,128 1,415 1,525 1,768 1,920 16.3% 12.2% 216 290 267 348 394 19.2% 20.5% 17.5% 19.7% 20.5% 19.0% 19.2%
Total $35,054 $44,993 $51,221 $51,147 $52,932 18.5% 3.4% $7,129 $8,647 $9,134 $9,894 $10,508 20.3% 19.2% 17.8% 19.3% 19.9% 20.5% 20.9%
Mid and Small-Cap Service
Superior Energy Services, Inc. $1,964 $4,568 $4,612 $4,570 $4,737 53.2% 1.3% $554 $1,250 $1,076 $1,220 $1,290 28.2% 27.4% 23.3% 26.7% 27.2% 26.3% 25.8%
U.S. Silica Holdings, Inc. 296 442 546 869 1,119 35.9% 43.2% 79 141 153 247 335 26.8% 32.0% 28.0% 28.4% 29.9% 28.9% 28.8%
Ensign Energy Services Inc. 1,860 2,204 1,975 2,039 2,162 3.1% 4.6% 483 566 455 471 494 26.0% 25.7% 23.1% 23.1% 22.8% 24.9% 23.0%
Trican Well Service Ltd. 2,272 2,221 1,991 2,369 2,507 (6.4%) 12.2% 606 243 156 238 325 26.7% 10.9% 7.8% 10.1% 13.0% 15.1% 10.3%
Calfrac Well Services Ltd. 1,512 1,600 1,472 2,114 2,194 (1.3%) 22.1% 406 258 177 306 343 26.9% 16.1% 12.0% 14.5% 15.6% 18.3% 14.0%
C&J Energy Services, Inc. 758 1,112 1,070 1,579 1,881 18.8% 32.6% 285 336 189 248 310 37.6% 30.2% 17.7% 15.7% 16.5% 28.5% 16.6%
Basic Energy Services, Inc. 1,243 1,375 1,263 1,484 1,560 0.8% 11.1% 333 297 231 322 350 26.8% 21.6% 18.3% 21.7% 22.5% 22.2% 20.8%
Key Energy Services Inc. 1,729 1,960 1,592 1,424 1,498 (4.1%) (3.0%) 420 421 269 161 220 24.3% 21.5% 16.9% 11.3% 14.7% 20.9% 14.3%
CARBO Ceramics Inc. 626 646 667 637 668 3.3% 0.0% 235 204 172 160 163 37.6% 31.6% 25.8% 25.1% 24.4% 31.7% 25.1%
TETRA Technologies, Inc. 845 881 909 1,072 1,300 3.7% 19.6% 103 123 91 150 293 12.2% 13.9% 10.0% 14.0% 22.5% 12.0% 15.5%
Total $13,106 $17,008 $16,098 $18,157 $19,625 10.7% 14.4% $3,504 $3,839 $2,970 $3,522 $4,123 26.7% 22.6% 18.4% 19.4% 21.0% 22.9% 19.4%
OCTG
Tenaris SA $9,972 $10,834 $10,597 $10,309 $10,772 3.1% 0.8% $2,400 $2,847 $2,764 $2,678 $2,882 24.1% 26.3% 26.1% 26.0% 26.8% 25.5% 26.3%
Vallourec SA 6,880 7,022 7,682 $6,745 $6,963 5.7% (4.8%) 1,222 1,088 1,215 1,019 1,094 17.8% 15.5% 15.8% 15.1% 15.7% 16.4% 15.5%
OAO TMK 6,754 6,688 6,432 $6,077 $6,468 (2.4%) 0.3% 1,017 1,006 929 839 942 15.1% 15.0% 14.4% 13.8% 14.6% 14.8% 14.3%
Total $23,606 $24,544 $24,711 $23,130 $24,202 2.1% (1.2%) $4,639 $4,941 $4,908 $4,535 $4,918 19.7% 20.1% 19.9% 19.6% 20.3% 18.9% 18.7%
Distribution
MRC Global Inc. $4,832 $5,571 $5,231 $5,958 $6,222 4.0% 9.1% $262 $475 $388 $441 $473 5.4% 8.5% 7.4% 7.4% 7.6% 7.1% 7.5%
NOW Inc. 1,641 3,414 4,296 $4,172 $4,373 61.8% 0.9% 134 180 241 227 275 8.2% 5.3% 5.6% 5.4% 6.3% 6.3% 5.8%
Total $6,473 $8,985 $9,527 $10,130 $10,594 32.9% 5.0% $396 $655 $629 $668 $748 6.1% 7.3% 6.6% 6.6% 7.1% 6.7% 6.6%
PAGE |
PUBLIC COMPARABLES CONT.
15
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
Stock Performance
Stock Price Change from 52-Week TEV / EBITDA EBITDA
TEV Dec-14 Nov-14 Prior Month Prior Year High % of High Dec-13 Jul-14 Current 2014E 2015P
Energy Services and Equipment
Logistics
ATCO Ltd. $12,956 $41.15 $41.80 (1.6%) (6.3%) $47.65 86.4% 8.1x 8.7x 8.5x 8.1x 7.5x
Tidewater Inc. 2,908 32.41 30.91 4.9% (45.3%) 60.47 53.6% 10.7x 9.5x 6.5x 6.9x 6.3x
Bristow Group, Inc. 2,838 65.79 64.10 2.6% (12.4%) 81.60 80.6% 11.3x 11.2x 9.1x 8.9x 7.5x
Hornbeck Offshore Services, Inc. 1,734 24.97 26.54 (5.9%) (49.3%) 49.04 50.9% 9.0x 9.1x 6.1x 5.9x 5.1x
Civeo Corporation 974 4.11 9.42 (56.4%) NM 28.40 14.5% NM NM 2.6x 3.0x 6.6x
Gulfmark Offshore, Inc. 1,129 24.42 26.05 (6.3%) (48.2%) 50.70 48.2% 10.8x 8.9x 5.9x 6.6x 6.7x
Median (3.7%) (45.3%) 52.3% 10.7x 9.1x 6.3x 6.8x 6.7x
Offshore Drillers
Transocean Ltd. $14,476 $18.33 $21.01 (12.8%) (62.9%) 49.58 37.0% 7.1x 6.3x 3.8x 4.0x 5.2x
Ensco plc 11,769 29.95 33.80 (11.4%) (47.6%) 57.45 52.1% 7.6x 7.2x 4.7x 4.9x 5.3x
Noble Corp. 9,567 16.57 17.99 (7.9%) (55.8%) 37.57 44.1% 7.8x 6.5x 4.2x 4.7x 5.9x
Diamond Offshore Drilling, Inc. 6,210 36.71 29.37 25.0% (35.5%) 57.29 64.1% 6.9x 7.3x 5.5x 5.7x 5.2x
Rowan Companies plc 5,004 23.32 21.77 7.1% (34.0%) 35.17 66.3% 9.2x 9.7x 8.4x 7.2x 5.1x
Atwood Oceanics, Inc. 3,501 28.37 32.09 (11.6%) (46.9%) 53.90 52.6% 8.1x 9.1x 6.2x 6.5x 5.0x
Hercules Offshore, Inc. 1,180 1.00 1.24 (19.4%) (84.7%) 6.74 14.8% 6.5x 5.0x 3.7x 4.9x 7.0x
Median (11.4%) (47.6%) 52.1% 7.6x 7.2x 4.7x 4.9x 5.2x
Land Drillers
Nabors Industries Ltd. $7,558 $12.98 $13.12 (1.1%) (23.6%) 30.24 42.9% 5.1x 7.2x 4.3x 4.2x 4.3x
Helmerich & Payne, Inc. 7,018 67.42 69.55 (3.1%) (19.8%) 118.95 56.7% 6.1x 8.1x 8.1x 4.5x 4.4x
Patterson-UTI Energy Inc. 3,075 16.59 17.69 (6.2%) (34.5%) 38.43 43.2% 4.5x 6.0x 3.3x 3.1x 3.0x
Precision Drilling Corporation 2,852 6.10 6.50 (6.2%) (34.8%) 13.51 45.1% 6.2x 8.1x 4.2x 4.1x 4.1x
Pioneer Energy Services Corp. 787 5.54 6.04 (8.3%) (30.8%) 18.40 30.1% 4.3x 7.4x 3.1x 3.0x 3.4x
Median (6.2%) (30.8%) 43.2% 5.1x 7.4x 4.2x 4.1x 4.1x
Engineering & Construction
Saipem SpA $10,933 $10.61 $14.31 (25.9%) (50.5%) 25.42 41.7% 17.4x 11.8x 7.5x 6.7x 5.7x
Technip SA 5,842 59.81 65.04 (8.0%) (37.8%) 101.03 59.2% 7.6x 8.4x 4.5x 4.6x 3.7x
Petrofac Limited 4,827 10.96 12.91 (15.1%) (46.0%) 23.11 47.4% 7.2x 8.1x 5.0x 5.0x 4.7x
Subsea 7 SA 3,511 10.23 9.97 2.6% (46.5%) 17.04 60.0% 8.4x 5.4x 2.7x 2.5x 3.1x
McDermott International Inc. 1,040 2.91 3.55 (18.0%) (68.2%) 9.36 31.1% NM NM NM NM NM
Median (15.1%) (46.5%) 47.4% 8.0x 8.2x 4.7x 4.8x 4.2x
TEV / LTM EBITDA as of
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PUBLIC COMPARABLES CONT.
16
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
Revenue Revenue Growth EBITDA EBITDA Margin Avg. Margin
2011 2012 2013 2014E 2015P '11-13 '13-15P 2011 2012 2013 2014E 2015P 2011 2012 2013 2014E 2015P '11-13 '13-15P
Energy Services and Equipment
Logistics
ATCO Ltd. $3,926 $4,025 $4,103 $4,066 $4,305 2.2% 2.4% $1,469 $1,550 $1,594 $1,621 $1,749 37.4% 38.5% 38.8% 39.9% 40.6% 38.3% 39.8%
Tidewater Inc. 1,051 1,060 1,230 1,426 1,555 8.2% 12.4% 271 265 352 418 466 25.8% 25.0% 28.6% 29.3% 29.9% 26.5% 29.3%
Bristow Group, Inc. 1,115 1,199 1,344 1,660 1,881 9.8% 18.3% 247 263 293 326 348 22.1% 22.0% 21.8% 19.6% 18.5% 22.0% 20.0%
Hornbeck Offshore Services, Inc. 331 463 548 642 774 28.7% 18.8% 121 192 255 291 354 36.5% 41.4% 46.6% 45.2% 45.7% 41.5% 45.9%
Civeo Corporation 865 1,109 1,041 933 817 9.7% (11.4%) 353 492 427 330 252 40.8% 44.4% 41.0% 35.4% 30.8% 42.1% 35.7%
Gulfmark Offshore, Inc. 382 389 455 495 508 9.1% 5.7% 138 103 159 171 175 36.1% 26.5% 34.9% 34.6% 34.4% 32.5% 34.6%
Total $7,669 $8,246 $8,721 $9,222 $9,839 11.3% 7.7% $2,598 $2,865 $3,080 $3,157 $3,342 33.9% 34.7% 35.3% 34.2% 34.0% 33.8% 34.2%
Offshore Drillers
Transocean Ltd. $7,407 $8,773 $9,070 $9,033 $8,017 10.7% (6.0%) $2,515 $3,522 $3,512 $3,695 $2,753 34.0% 40.1% 38.7% 40.9% 34.3% 37.6% 38.0%
Ensco plc 2,798 4,301 4,920 4,827 4,790 32.6% (1.3%) 1,150 2,097 2,348 2,402 2,253 41.1% 48.8% 47.7% 49.8% 47.0% 45.9% 48.2%
Noble Corp. 2,616 3,431 4,122 4,123 3,421 25.5% (8.9%) 1,128 1,537 1,980 2,015 1,624 43.1% 44.8% 48.0% 48.9% 47.5% 45.3% 48.1%
Diamond Offshore Drilling, Inc. 3,254 2,936 2,844 2,822 3,091 (6.5%) 4.3% 1,649 1,337 1,186 1,098 1,195 50.7% 45.5% 41.7% 38.9% 38.7% 46.0% 39.8%
Rowan Companies plc 939 1,393 1,579 1,797 2,339 29.7% 21.7% 364 515 587 695 1,013 38.7% 37.0% 37.2% 38.7% 43.3% 37.6% 39.7%
Atwood Oceanics, Inc. 637 756 1,018 1,172 1,389 26.4% 16.8% 377 390 548 539 687 59.2% 51.7% 53.8% 46.0% 49.5% 54.9% 49.8%
Hercules Offshore, Inc. 575 618 858 904 861 22.2% 0.2% 155 172 293 243 254 26.9% 27.8% 34.1% 26.9% 29.5% 29.6% 30.2%
Total $18,226 $22,208 $24,411 $24,679 $23,908 20.1% 3.8% $7,338 $9,569 $10,454 $10,687 $9,779 40.3% 43.1% 42.8% 43.3% 40.9% 42.4% 42.0%
Land Drillers
Nabors Industries Ltd. $6,013 $6,843 $6,152 $6,857 $7,510 1.1% 10.5% $1,841 $1,966 $1,680 $1,781 $2,036 30.6% 28.7% 27.3% 26.0% 27.1% 28.9% 26.8%
Helmerich & Payne, Inc. 2,529 3,138 3,374 3,711 4,157 15.5% 11.0% 1,004 1,278 1,400 1,568 1,700 39.7% 40.7% 41.5% 42.2% 40.9% 40.6% 41.5%
Patterson-UTI Energy Inc. 2,566 2,723 2,716 3,176 3,803 2.9% 18.3% 958 990 916 994 1,167 37.3% 36.4% 33.7% 31.3% 30.7% 35.8% 31.9%
Precision Drilling Corporation 1,919 2,047 1,911 2,086 2,317 (0.2%) 10.1% 569 478 600 704 796 29.7% 23.4% 31.4% 33.7% 34.4% 28.1% 33.2%
Pioneer Energy Services Corp. 716 919 960 1,040 1,083 15.8% 6.2% 191 248 236 261 255 26.6% 26.9% 24.6% 25.1% 23.6% 26.1% 24.4%
Total $13,743 $15,671 $15,113 $16,870 $18,870 7.0% 11.2% $4,563 $4,960 $4,832 $5,307 $5,954 33.2% 31.7% 32.0% 31.5% 31.6% 31.9% 31.6%
Engineering & Construction
Saipem SpA $16,360 $17,304 $16,878 $15,929 $15,418 1.6% (4.4%) $2,766 $2,567 $949 $1,650 $2,072 16.9% 14.8% 5.6% 10.4% 13.4% 12.5% 9.8%
Technip SA 8,851 10,817 12,857 12,956 14,037 20.5% 4.5% 1,093 1,321 1,431 1,308 1,631 12.3% 12.2% 11.1% 10.1% 11.6% 11.9% 10.9%
Petrofac Limited 5,801 6,240 6,329 6,696 7,901 4.5% 11.7% 759 842 1,014 966 1,031 13.1% 13.5% 16.0% 14.4% 13.0% 14.2% 14.5%
Subsea 7 SA 5,055 6,297 6,297 7,090 6,220 11.6% (0.6%) 816 1,044 825 1,418 1,190 16.1% 16.6% 13.1% 20.0% 19.1% 15.3% 17.4%
McDermott International Inc. 3,445 3,642 2,659 2,211 2,811 (12.1%) 2.8% 335 422 (259) 44 163 9.7% 11.6% (9.7%) 2.0% 5.8% 3.9% (0.6%)
Total $39,512 $44,299 $45,020 $44,883 $46,387 5.2% 2.8% $5,769 $6,196 $3,960 $5,386 $6,087 14.6% 14.0% 8.8% 12.0% 13.1% 11.5% 10.4%
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PUBLIC COMPARABLES CONT.
17
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
Stock Performance
Stock Price Change from 52-Week TEV / EBITDA EBITDA
TEV Dec-14 Nov-14 Prior Month Prior Year High % of High Dec-13 Jul-14 Current 2014E 2015P
Power Services and Equipment
Large Cap Equipment and Services
General Electric Company $625,844 $25.27 $26.49 (4.6%) (9.8%) $27.94 90.4% 22.9x 22.4x 21.7x 24.6x 23.1x
Siemens Aktiengesellschaft 108,859 113.77 118.61 (4.1%) (17.0%) 122.54 92.8% 10.6x 10.0x 10.6x 8.8x 9.0x
Honeywell International Inc. 78,708 99.92 99.07 0.9% 9.4% 102.39 97.6% 11.5x 11.2x 11.4x 10.5x 9.7x
ABB Ltd. 50,602 21.28 22.45 (5.2%) (19.3%) 24.97 85.2% 11.5x 10.6x 10.6x 9.1x 8.3x
Schneider Electric SE 50,607 73.36 81.58 (10.1%) (16.0%) 87.42 83.9% 10.7x 11.3x 9.8x NA NA
Emerson Electric Co. 45,655 61.73 63.75 (3.2%) (12.0%) 70.29 87.8% 10.7x 10.4x 9.3x 9.1x 8.9x
Eaton Corporation plc 40,353 67.96 67.83 0.2% (10.7%) 79.98 85.0% 13.5x 13.4x 11.7x 11.6x 10.5x
Alstom SA 15,384 32.51 34.97 (7.0%) (10.8%) 37.46 86.8% 11.8x 6.4x 6.7x NA NA
Median (4.3%) (11.4%) 87.3% 11.5x 10.9x 10.6x 9.8x 9.3x
Mid and Small-Cap Equipment and Services
Ametek Inc. $14,211 $52.63 $50.96 3.3% (0.1%) $54.50 96.6% 14.9x 14.1x 14.0x 13.7x 12.5x
Hubbell Inc. 6,284 106.83 106.80 0.0% (1.9%) 127.29 83.9% 11.0x 12.3x 10.6x 10.6x 10.0x
Valmont Industries, Inc. 3,508 127.00 135.22 (6.1%) (14.8%) 163.23 77.8% 7.1x 8.1x 7.1x 7.7x 7.4x
Littelfuse Inc. 2,072 96.67 96.13 0.6% 4.0% 100.82 95.9% 12.0x 11.6x 11.1x 11.1x 10.1x
AZZ incorporated 1,557 46.92 44.78 4.8% (4.0%) 49.09 95.6% 11.3x 10.7x 10.5x 10.6x 9.8x
ESCO Technologies Inc. 972 36.90 36.02 2.4% 7.7% 38.44 96.0% 13.0x 11.1x 11.9x 11.6x 10.6x
Thermon Group Holdings, Inc. 808 24.19 24.19 0.0% (11.5%) 28.63 84.5% 13.4x 12.0x 10.5x 10.9x 10.0x
Badger Meter Inc. 909 59.35 55.09 7.7% 8.9% 60.91 97.4% 16.0x 13.6x 14.2x 15.1x 12.8x
Powell Industries, Inc. 490 49.07 42.55 15.3% (26.8%) 70.75 69.4% 10.9x 11.8x 11.8x 13.1x 9.6x
Global Power Equipment Group Inc. 271 13.81 12.97 6.5% (29.4%) 20.04 68.9% 11.7x 8.8x 7.5x 10.0x 8.9x
Median 2.9% (2.9%) 90.0% 11.8x 11.7x 10.9x 11.0x 10.0x
Energy Efficiency and Clean Technology
SolarCity Corporation $6,252 $53.48 $55.00 (2.8%) NA $88.35 60.5% NM NM NM NM NM
Itron, Inc. 1,866 42.29 40.40 4.7% 2.1% 43.67 96.8% 11.1x 10.0x 10.4x 11.2x 9.7x
OPOWER, Inc. 572 14.23 NM NM NM 26.00 54.7% NM NM NM NM NM
Ameresco, Inc. 491 7.00 7.71 (9.2%) (27.5%) 10.81 64.8% 21.9x 16.8x 15.8x 13.2x 11.6x
EnerNOC, Inc. 341 15.45 14.59 5.9% (10.2%) 24.35 63.5% 8.0x 9.1x 6.6x 4.7x 6.7x
Silver Spring Networks, Inc. 302 8.43 7.17 17.6% NA 23.61 35.7% NM NM NM NM 13.7x
PowerSecure International, Inc. 241 11.65 10.02 16.3% (32.1%) 27.44 42.5% 16.1x 24.5x NM NM 11.0x
Echelon Corporation 47 1.70 1.81 (6.1%) (20.9%) 4.18 40.7% NM NM NM NM NM
Median 4.7% (20.9%) 57.6% 13.6x 13.4x 10.4x 11.2x 11.0x
TEV / LTM EBITDA as of
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PUBLIC COMPARABLES CONT.
18
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
Revenue Revenue Growth EBITDA EBITDA Margin Avg. Margin
2011 2012 2013 2014E 2015P '11-13 '13-15P 2011 2012 2013 2014E 2015P 2011 2012 2013 2014E 2015P '11-13 '13-15P
Power Services and Equipment
Large Cap Equipment and Services
General Electric Company $94,522 $100,149 $100,542 $148,988 $149,896 3.1% 22.1% $27,846 $29,238 $28,875 $27,570 $27,979 29.5% 29.2% 28.7% 18.5% 18.7% 29.1% 22.0%
Siemens Aktiengesellschaft 97,527 99,396 102,703 92,463 92,273 2.6% (5.2%) 13,405 11,457 10,292 12,298 12,555 13.7% 11.5% 10.0% 13.3% 13.6% 11.8% 12.3%
Honeywell International Inc. 36,529 37,665 39,055 40,410 41,986 3.4% 3.7% 3,531 5,082 6,490 7,581 8,144 9.7% 13.5% 16.6% 18.8% 19.4% 13.3% 18.3%
ABB Ltd. 37,990 39,336 41,848 40,329 41,132 5.0% (0.9%) 5,538 5,259 5,636 5,587 6,127 14.6% 13.4% 13.5% 13.9% 14.9% 13.8% 14.1%
Schneider Electric SE 29,029 31,572 32,433 30,596 32,272 5.7% (0.2%) 4,656 5,186 5,199 4,782 5,260 16.0% 16.4% 16.0% 15.6% 16.3% 16.2% 16.0%
Emerson Electric Co. 24,222 24,412 24,669 24,551 24,774 0.9% 0.2% 4,797 4,751 4,766 4,841 5,095 19.8% 19.5% 19.3% 19.7% 20.6% 19.5% 19.9%
Eaton Corporation plc 16,049 16,311 22,046 22,585 23,220 17.2% 2.6% 2,203 2,350 3,307 3,543 3,847 13.7% 14.4% 15.0% 15.7% 16.6% 14.4% 15.8%
Alstom SA 29,672 26,573 25,971 27,575 7,700 (6.4%) (45.5%) 3,009 2,534 2,359 2,456 519 10.1% 9.5% 9.1% 0 0 9.6% 8.2%
Total $365,540 $375,415 $389,266 $427,497 $413,252 3.9% (2.9%) $64,986 $65,857 $66,923 $68,659 $69,527 17.8% 17.5% 17.2% 16.1% 16.8% 16.0% 15.8%
Mid and Small-Cap Equipment and Services
Ametek Inc. $2,990 $3,334 $3,594 $4,032 $4,273 9.6% 9.0% $722 $851 $934 $1,038 $1,135 24.2% 25.5% 26.0% 25.8% 26.6% 25.2% 26.1%
Hubbell Inc. 2,872 3,044 3,184 3,352 3,495 5.3% 4.8% 487 535 574 589 627 17.0% 17.6% 18.0% 17.6% 17.9% 17.5% 17.8%
Valmont Industries, Inc. 2,661 3,030 3,304 3,175 3,284 11.4% (0.3%) 342 451 563 463 475 12.8% 14.9% 17.0% 14.6% 14.5% 14.9% 15.4%
Littelfuse Inc. 665 668 758 850 893 6.8% 8.5% 154 141 168 189 208 23.1% 21.1% 22.1% 22.3% 23.3% 22.1% 22.6%
AZZ incorporated 381 469 571 763 852 22.4% 22.2% 85 98 129 147 163 22.3% 21.0% 22.6% 19.3% 19.1% 22.0% 20.3%
ESCO Technologies Inc. 451 479 490 526 548 4.3% 5.7% 62 65 73 83 90 13.8% 13.5% 14.9% 15.8% 16.5% 14.1% 15.7%
Thermon Group Holdings, Inc. 241 272 284 284 299 8.5% 2.5% 53 58 71 74 80 21.9% 21.4% 24.8% 26.2% 26.8% 22.7% 25.9%
Badger Meter Inc. 263 320 334 362 395 12.7% 8.7% 37 57 53 60 73 14.1% 17.7% 15.8% 16.7% 18.4% 15.8% 17.0%
Powell Industries, Inc. 562 717 675 635 687 9.5% 0.9% 28 61 63 36 55 5.0% 8.6% 9.4% 5.7% 8.0% 7.7% 7.7%
Global Power Equipment Group Inc. 457 463 484 537 565 3.0% 8.0% 29 29 29 28 33 6.3% 6.2% 6.0% 5.3% 5.8% 6.2% 5.7%
Total $11,543 $12,796 $13,678 $14,516 $15,290 9.4% 7.0% $1,999 $2,345 $2,656 $2,709 $2,938 17.3% 18.3% 19.4% 18.7% 19.2% 16.8% 17.4%
Energy Efficiency and Clean Technology
SolarCity Corporation $60 $127 $164 $254 $470 65.9% 69.4% ($49) ($70) ($106) ($220) ($246) (82.1%) (55.3%) (65.0%) (86.6%) (52.3%) (67.5%) (67.9%)
Itron, Inc. 2,434 2,178 1,949 1,957 2,010 (10.5%) 1.6% 315 265 173 164 191 12.9% 12.2% 8.9% 8.4% 9.5% 11.3% 8.9%
OPOWER, Inc. 29 52 89 127 155 75.7% 32.2% (21) (11) (12) (15) (23) (71.9%) (21.8%) (13.1%) (11.7%) (14.6%) (35.6%) (13.1%)
Ameresco, Inc. 728 631 574 586 607 (11.2%) 2.8% 65 49 27 37 40 8.9% 7.8% 4.7% 6.3% 6.7% 7.1% 5.9%
EnerNOC, Inc. 287 278 383 467 515 15.7% 15.9% 10 3 51 73 83 3.6% 1.0% 13.2% 15.6% 16.1% 5.9% 15.0%
Silver Spring Networks, Inc. 237 197 327 283 319 17.4% (1.2%) (87) (82) (35) (19) 26 (36.9%) (41.5%) (10.8%) (6.6%) 8.0% (29.7%) (3.1%)
PowerSecure International, Inc. 130 162 270 245 342 44.2% 12.6% 2 9 22 1 23 1.8% 5.8% 8.0% 0.5% 6.6% 5.2% 5.0%
Echelon Corporation 156 134 86 51 47 (25.8%) (26.1%) (5) (3) (6) (19) (7) (3.4%) (2.6%) (7.2%) (37.7%) (15.8%) (4.4%) (20.2%)
Total $4,061 $3,759 $3,842 $3,970 $4,466 21.4% 13.4% $230 $160 $113 $2 $86 5.7% 4.3% 2.9% 0.1% 1.9% (13.4%) (8.7%)
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PUBLIC COMPARABLES CONT.
19
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
Stock Performance
Stock Price Change from 52-Week TEV / EBITDA EBITDA
TEV Jan-15 Dec-14 Prior Month Prior Year High % of High Jan-14 Jul-14 Current 2014E 2015P
Infrastructure Services
Large Cap Infrastructure Services
Fluor Corporation $8,082 $60.63 $61.58 (1.5%) (23.1%) $83.93 72.2% 7.8x 8.2x 5.9x 5.9x 5.5x
Chicago Bridge & Iron Company N.V. 6,687 41.98 46.89 (10.5%) (48.5%) 89.22 47.1% 11.0x 8.8x 6.0x 5.7x 5.0x
SNC-Lavalin Group Inc. 7,668 38.26 36.06 6.1% (14.1%) 51.49 74.3% 19.4x 17.1x 9.9x 12.7x 11.8x
Jacobs Engineering Group Inc. 5,939 44.69 46.58 (4.1%) (28.9%) 66.88 66.8% 9.8x 10.5x 7.7x 7.5x 6.8x
The Babcock & Wilcox Company 3,336 30.30 29.11 4.1% (10.9%) 36.00 84.2% 6.1x 6.7x 6.5x 10.4x 7.5x
KBR, Inc. 1,483 16.95 17.01 (0.4%) (45.2%) 34.77 48.7% 15.7x NM NM 10.1x 4.2x
Median (0.9%) (26.0%) 69.5% 10.4x 8.8x 6.5x 8.8x 6.1x
Mid and Small-Cap Infrastructure Services
Foster Wheeler AG $2,382 $26.71 $27.55 (3.1%) (19.3%) $31.16 85.7% 12.0x 12.7x 11.0x 9.4x 7.6x
Tutor Perini Corporation 1,978 24.07 24.81 (3.0%) (4.6%) 32.51 74.0% 7.2x 7.6x 6.5x 6.8x 5.8x
Primoris Services Corporation 1,288 23.24 22.55 3.1% (24.0%) 33.42 69.5% 9.2x 8.3x 6.9x 6.9x 5.9x
Aecon Group Inc. 881 9.25 9.89 (6.5%) (38.1%) 16.19 57.1% 10.9x 12.2x 8.9x 6.0x 4.7x
Granite Construction Incorporated 1,416 38.02 35.90 5.9% 11.6% 40.55 93.8% 19.9x 15.2x 15.2x 10.5x 7.2x
Willbros Group Inc. 514 6.27 4.29 46.2% (32.2%) 13.69 45.8% 9.9x 11.9x 7.3x 7.6x 5.1x
Great Lakes Dredge & Dock Corporation 780 8.56 7.78 10.0% (4.4%) 9.44 90.7% 10.0x 9.2x 10.3x 11.1x 6.5x
Orion Marine Group, Inc 292 11.05 10.85 1.8% (6.3%) 13.50 81.9% 14.0x 13.4x 9.9x 9.3x 6.5x
Median 2.5% (12.8%) 77.9% 10.4x 12.0x 9.4x 8.4x 6.2x
Utility Services
Quanta Services, Inc. $6,138 $28.39 $29.21 (2.8%) (9.3%) $37.49 75.7% 9.4x 10.8x 8.7x 8.0x 6.4x
MasTec, Inc. 3,009 22.61 23.18 (2.5%) (30.3%) 44.80 50.5% 7.8x 7.9x 7.3x 7.2x 6.1x
Dycom Industries Inc. 1,646 35.09 31.96 9.8% 27.8% 35.65 98.4% 7.2x 8.3x 9.1x 8.9x 7.7x
MYR Group, Inc. 505 27.40 26.32 4.1% 10.9% 28.33 96.7% 5.3x 6.1x 5.9x 6.2x 5.7x
Median 0.8% 0.8% 86.2% 7.5x 8.1x 8.0x 7.6x 6.2x
Industrial Services
Bilfinger SE $2,816 $56.39 $57.94 (2.7%) (49.1%) $112.40 50.2% 8.3x 7.4x 6.7x 6.6x 5.3x
EMCOR Group Inc. 2,798 44.49 43.00 3.5% 6.3% 48.00 92.7% 9.7x 8.7x 7.9x 7.7x 6.8x
Aegion Corporation 983 18.61 18.40 1.1% (12.2%) 25.64 72.6% 10.1x 9.8x 8.0x 9.0x 7.1x
Team, Inc. 878 40.46 38.89 4.0% (3.2%) 48.09 84.1% 13.3x 13.0x 11.5x 11.4x 9.4x
Mistras Group, Inc. 669 18.33 16.87 8.7% (12.5%) 25.48 71.9% 10.8x 12.7x 11.2x 9.6x 8.9x
Matrix Service Company 531 22.32 20.32 9.8% (7.4%) 38.71 57.7% 8.7x 10.8x 6.7x 6.8x 6.0x
Furmanite Corporation 317 7.82 6.46 21.1% (31.3%) 12.70 61.6% 12.8x 15.0x 10.4x 9.8x 7.5x
Median 4.0% (12.2%) 71.9% 10.1x 10.8x 8.0x 9.0x 7.1x
Engineering Services
AECOM Technology Corporation $5,187 $30.37 $30.55 (0.6%) 3.9% $38.24 79.4% 7.7x 9.9x 12.6x 10.8x 4.6x
Stantec Inc. 2,745 27.57 27.30 1.0% (8.9%) 32.93 83.7% 12.7x 12.4x 11.3x 10.5x 9.2x
WSP Global Inc. 2,884 30.10 30.27 (0.6%) 4.9% 34.11 88.3% 12.4x 15.6x 18.7x 13.3x 8.2x
Tetra Tech Inc. 1,754 26.70 26.39 1.2% (2.9%) 30.92 86.4% 13.5x 9.5x 11.6x 8.4x 8.2x
RPS Group plc 802 3.26 3.63 (10.2%) (40.6%) 5.62 58.0% 9.9x 8.7x 6.2x 6.5x 6.0x
Median (0.6%) (2.9%) 83.7% 12.4x 9.9x 11.6x 10.5x 8.2x
TEV / LTM EBITDA as of
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PUBLIC COMPARABLES CONT.
20
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
Revenue Revenue Growth EBITDA EBITDA Margin Avg. Margin
2011 2012 2013 2014E 2015P '11-13 '13-15P 2011 2012 2013 2014E 2015P 2011 2012 2013 2014E 2015P '11-13 '13-15P
Infrastructure Services
Large Cap Infrastructure Services
Fluor Corporation $23,381 $27,577 $27,352 $21,839 $25,150 8.2% (4.1%) $1,187 $946 $1,397 $1,398 $1,480 5.1% 3.4% 5.1% 6.4% 5.9% 4.5% 5.8%
Chicago Bridge & Iron Company N.V. 4,551 5,485 11,095 13,055 15,000 56.1% 16.3% 416 517 934 1,184 1,344 9.1% 9.4% 8.4% 9.1% 9.0% 9.0% 8.8%
SNC-Lavalin Group Inc. 6,599 7,550 6,730 7,017 9,105 1.0% 16.3% 724 662 452 721 684 11.0% 8.8% 6.7% 10.3% 7.5% 8.8% 8.2%
Jacobs Engineering Group Inc. 10,382 10,894 11,818 12,798 13,406 6.7% 6.5% 628 695 766 788 889 6.1% 6.4% 6.5% 6.2% 6.6% 6.3% 6.4%
The Babcock & Wilcox Company 2,952 3,291 3,269 2,868 3,121 5.2% (2.3%) 87 351 579 326 448 2.9% 10.7% 17.7% 11.4% 14.4% 10.4% 14.5%
KBR, Inc. 9,103 7,770 7,214 6,614 6,743 (11.0%) (3.3%) 497 361 237 154 370 5.5% 4.6% 3.3% 2.3% 5.5% 4.5% 3.7%
Total $56,968 $62,568 $67,477 $64,191 $72,524 11.0% 4.9% $3,540 $3,533 $4,366 $4,571 $5,215 6.2% 5.6% 6.5% 7.1% 7.2% 7.3% 7.9%
Mid and Small-Cap Infrastructure Services
Foster Wheeler AG $4,458 $3,391 $3,306 $3,388 $4,192 (13.9%) 12.6% $230 $271 $244 $256 $334 5.2% 8.0% 7.4% 7.6% 8.0% 6.8% 7.6%
Tutor Perini Corporation 3,716 4,111 4,176 4,554 5,078 6.0% 10.3% 214 214 260 293 346 5.7% 5.2% 6.2% 6.4% 6.8% 5.7% 6.5%
Primoris Services Corporation 1,460 1,542 1,944 2,224 2,465 15.4% 12.6% 133 129 177 189 221 9.1% 8.4% 9.1% 8.5% 9.0% 8.9% 8.9%
Aecon Group Inc. 2,849 2,897 2,888 2,452 2,601 0.7% (5.1%) 133 122 115 152 202 4.7% 4.2% 4.0% 6.2% 7.8% 4.3% 6.0%
Granite Construction Incorporated 2,010 2,083 2,267 2,390 2,706 6.2% 9.3% 146 110 61 136 193 7.3% 5.3% 2.7% 5.7% 7.1% 5.1% 5.2%
Willbros Group Inc. 1,376 1,929 2,019 2,111 1,845 21.1% (4.4%) 37 69 76 80 110 2.7% 3.6% 3.8% 3.8% 6.0% 3.4% 4.5%
Great Lakes Dredge & Dock Corporation 520 588 731 796 978 18.6% 15.6% 79 70 79 72 121 15.2% 11.9% 10.8% 9.1% 12.4% 12.6% 10.7%
Orion Marine Group, Inc 260 292 355 386 434 16.8% 10.6% 3 7 21 31 44 1.1% 2.5% 6.0% 8.1% 10.2% 3.2% 8.1%
Total $16,649 $16,833 $17,686 $18,301 $20,299 8.9% 7.7% $975 $992 $1,034 $1,209 $1,572 5.9% 5.9% 5.8% 6.6% 7.7% 6.2% 7.2%
Utility Services
Quanta Services, Inc. $4,194 $5,920 $6,523 $7,799 $8,580 24.7% 14.7% $334 $623 $689 $777 $969 8.0% 10.5% 10.6% 10.0% 11.3% 9.7% 10.6%
MasTec, Inc. 2,831 3,727 4,325 4,602 5,328 23.6% 11.0% 241 331 429 425 523 8.5% 8.9% 9.9% 9.2% 9.8% 9.1% 9.6%
Dycom Industries Inc. 1,036 1,201 1,609 1,817 1,911 24.6% 9.0% 105 128 173 188 214 10.2% 10.7% 10.8% 10.3% 11.2% 10.5% 10.8%
(Invalid Identifier) 594 685 919 822 869 24.4% (2.7%) 48 64 114 70 82 8.1% 9.3% 12.4% 8.5% 9.4% 9.9% 10.1%
MYR Group, Inc. 780 999 903 938 988 7.6% 4.6% 48 80 88 82 89 6.1% 8.0% 9.7% 8.7% 9.0% 7.9% 9.1%
Total $9,435 $12,532 $14,278 $15,978 $17,676 21.0% 7.3% $776 $1,226 $1,491 $1,542 $1,877 8.2% 9.8% 10.4% 9.6% 10.6% 9.4% 10.1%
Industrial Services
Bilfinger SE $10,664 $11,001 $11,588 $9,508 $9,702 4.2% (8.5%) $455 $600 $624 $433 $542 4.3% 5.5% 5.4% 4.6% 5.6% 5.0% 5.2%
EMCOR Group Inc. 5,613 6,347 6,417 6,400 6,689 6.9% 2.1% 272 305 286 363 407 4.8% 4.8% 4.5% 5.7% 6.1% 4.7% 5.4%
Aegion Corporation 926 1,017 1,091 1,320 1,382 8.6% 12.5% 88 113 109 104 138 9.5% 11.1% 10.0% 7.8% 10.0% 10.2% 9.3%
Team, Inc. 508 624 714 749 841 18.6% 8.5% 57 73 74 78 93 11.2% 11.7% 10.4% 10.3% 11.1% 11.1% 10.6%
Mistras Group, Inc. 339 437 529 610 727 25.0% 17.2% 48 60 61 70 77 14.2% 13.7% 11.6% 11.5% 10.6% 13.2% 11.2%
Matrix Service Company 627 739 893 1,273 1,474 19.3% 28.5% 42 43 50 78 90 6.7% 5.8% 5.6% 6.2% 6.1% 6.0% 6.0%
Furmanite Corporation 316 326 427 538 581 16.2% 16.7% 30 22 36 32 42 9.5% 6.7% 8.5% 6.0% 7.3% 8.2% 7.2%
Total $18,993 $20,490 $21,660 $20,399 $21,396 14.1% 11.0% $992 $1,215 $1,240 $1,158 $1,389 5.2% 5.9% 5.7% 5.7% 6.5% 8.3% 7.8%
Engineering Services
AECOM Technology Corporation $8,037 $8,218 $8,153 $8,038 $19,590 0.7% 55.0% $480 $434 $460 $481 $1,162 6.0% 5.3% 5.6% 6.0% 5.9% 5.6% 5.9%
Stantec Inc. 1,356 1,559 1,725 1,836 2,140 12.8% 11.4% 196 216 233 266 310 14.4% 13.9% 13.5% 14.5% 14.5% 13.9% 14.2%
WSP Global Inc. 641 1,262 1,898 2,071 3,596 72.0% 37.7% 84 110 133 222 360 13.0% 8.7% 7.0% 10.7% 10.0% 9.6% 9.2%
Tetra Tech Inc. 1,792 2,022 2,025 1,875 1,869 6.3% (3.9%) 200 208 129 210 216 11.1% 10.3% 6.4% 11.2% 11.5% 9.3% 9.7%
RPS Group plc 823 903 940 846 924 6.9% (0.9%) 97 113 123 124 139 11.8% 12.6% 13.1% 14.6% 15.0% 12.5% 14.2%
Total $12,650 $13,964 $14,741 $14,666 $28,118 19.7% 19.8% $1,055 $1,081 $1,079 $1,303 $2,186 8.3% 7.7% 7.3% 8.9% 7.8% 10.2% 10.6%
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ENERGY & POWER
21
SOURCES
ENERGY & POWER
INDUSTRY UPDATE │ JANUARY 2015
1. Capital IQ.
2. MergerMarket.
3. Baker Hughes.
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