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Harris Williams & Co. Ltd is a private limited company incorporated under English law having its registered office at 5th Floor, 6 St. Andrew Street, London EC4A 3AE, UK, registered withthe Registrar of Companies for England and Wales under company number 7078852. Directors: Mr. Christopher Williams, Mr. Ned Valentine, Mr. Paul Poggi and Mr. Thierry Monjauze,authorised and regulated by the Financial Conduct Authority.
Harris Williams & Co. Ltd Niederlassung Frankfurt (German branch) is registered in the Commercial Register (Handelsregister) of the Local Court (Amtsgericht) of Frankfurt am Main,Germany, under registration number HRB 96687, having its business address at Bockenheimer Landstrasse 33-35, 60325 Frankfurt am Main, Germany. Permanent Representative(Ständiger Vertreter) of the Branch Niederlassung: Mr. Jeffery H. Perkins.
ENERGY, POWER & INFRASTRUCTURE
0
INDUSTRY UPDATE │ OCTOBER 2015
PAGE |
www.harriswilliams.de
SUMMARY
1
CONTENTS
WHAT WE’RE READING
M&A TRANSACTIONS
PUBLIC MARKETS INDUSTRY
PUBLIC COMPARABLES
CONTACTS
UNITED STATES
Andrew SpitzerManaging [email protected] +1 (804) 915-0174
Brian LucasManaging [email protected] +1 (804) 932-1323
Matthew White [email protected] +1 (804) 915-0131
Luke [email protected] +1 (804) 915-0158
Chris BurnhamVice [email protected] +1 (804) 915-0142
Ian ThomasVice [email protected]+1 (804) 932-1384
EUROPE
Jeffery PerkinsManaging [email protected]+49 (0) 69 3650638 00
M&A | SELECT RECENT ACTIVITY
MMM Group, a portfolio company of OMERS private equity, has been acquired by
WSP Global. MMM is a provider of critical engineering consulting services to a
wide range of clients across Canada and internationally. HW&Co. served as
financial advisor to MMM.Source | Instapaper
Prysmian Group, an Italian based leader in the energy and telecom cable systems
industry, has acquired Gulf Coast Downhole Technologies (GCDT). GCDT is a
Houston based designer and supplier of innovative downhole equipment for the
oil and gas industry.Source | Instapaper
Professional Service Industries (PSI), a portfolio company of Olympus Partners, has been acquired by Intertek Group plc. PSI provides consulting, engineering, and testing services for commercial and industrial clients, as well as public projects.Source | Instapaper
Willbros Group has sold its Professional Services line to TRC Companies, a recognized leader in engineering, consulting, and construction management for energy and infrastructure end markets. The $130 million all-cash acquisition will allow TRC to provide more enhanced integrated services to its clients.Source | Instapaper
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
PUBLIC MARKETS | KEY TRADING STATISTICS
Stock Price % Change TEV / EBITDA
1 Month 12 Month Oct-14 Apr-15 Current 2015E 2016P
Energy Services and Equipment
Large Cap Service 3.0% (18.8%) 8.1x 7.6x 7.7x 10.3x 9.8x
Equipment 2.3% (30.8%) 9.0x 7.1x 6.5x 8.4x 10.2x
Small-Cap Service 4.5% (59.8%) 6.6x 7.7x 5.6x 10.1x 9.9x
OCTG 9.8% (58.8%) 6.8x 6.4x 6.4x 7.2x 7.7x
Distribution 5.7% (35.6%) 10.3x 11.5x 16.9x 10.8x 10.4x
Logistics 9.6% (53.7%) 7.3x 6.3x 5.8x 6.2x 6.9x
Offshore Drillers 8.7% (44.5%) 6.8x 5.8x 4.4x 4.9x 6.0x
Land Drillers 16.3% (32.5%) 4.9x 4.8x 4.1x 5.9x 6.3x
E&C 9.8% (13.8%) 8.1x 8.4x 7.8x 7.3x 6.5x
Power Services and Equipment
Large Cap PS&E (2.4%) (5.8%) 10.1x 11.7x 10.1x 9.2x 8.7x
Small-Cap PS&E 1.9% 2.8% 10.3x 11.2x 10.2x 10.7x 9.4x
EE and Cleantech 1.7% (6.6%) 9.2x 11.2x 12.3x 11.3x 8.1x
Industrial & Infrastructure Services
Large Cap 3.3% (10.8%) 7.2x 6.6x 5.8x 6.9x 6.1x
Small-Cap 5.7% (17.4%) 8.5x 9.6x 9.7x 6.8x 5.7x
Utility Services 0.2% (1.5%) 7.4x 7.6x 7.7x 6.4x 5.7x
Industrial Services 2.4% 8.5% 10.0x 10.0x 8.5x 8.1x 6.3x
Engineering Services 6.7% 7.1% 10.5x 10.8x 11.3x 8.1x 7.5x
TEV / LTM EBITDA as of
PAGE |
www.harriswilliams.de
WHAT WE’RE READING
According to IHS, 2016 oil price hedges for North American E&Ps will decline to just 11% of total production. The likelyresult is increased pressure for financially stressed operators, particularly those unable to take advantage of higherprices and hedge options in 2Q 2015.IHS| Instapaper
2
OIL & GAS | OVER THE HEDGE
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
For those who remember last year’s reports of prominent New York developers entering the Williston real estatemarket, Fuel Fix offered a sobering view of just how quickly markets can change. “After struggling to house thousandsof migrant roughnecks during the boom, the state faces a new real-estate crisis: The frenzied drilling that made it No. 1in personal-income growth and job creation for five consecutive years hasn’t lasted long enough to support the oil-fueled building explosion.”Fuel Fix| Instapaper
OIL & GAS | MAN CAMPS AND NORTH DAKOTA’S “REAL ESTATE CRISIS”
POWER | ONLY IN TEXAS
As coal futures hit $50/ton for the first time since 2008, Goldman Sachs released a new report projecting coal use willpeak by the end of the decade. In short, Goldman believes coal is in terminal decline. "The industry does not requirenew investment given the ability of existing assets to satisfy flat demand, so prices will remain under pressure as thedeflationary cycle continues," Goldman said.Reuters | Instapaper
ENERGY | “PEAK COAL”
BIC reports on the wave of investments in North America’s downstream chemical and petrochemical infrastructure.More than 225 chemical projects, representing more than $140 billion in capital investment, have been announcedand are expected to drive over 700,000 permanent new jobs by 2023. After years of short supply in the upstreamsector, the demand for qualified craftspeople looks set to continue in the downstream market.BIC| Instapaper
OIL & GAS | CONTINUED GROWTH DOWNSTREAM
Bloomberg reported on the rise of renewable power generation in the US and its impact on the capacity factor offossil fuel generation. The article suggests the US has reached a turning point that will continue to incentivize greateradoption of renewables and less investment in fossil fuel generation.Bloomberg| Instapaper
RENEWABLES | A TURNING POINT?
Bloomberg New Energy Finance (BNEF) released a report on the projected impact of extending the investment taxcredit (ITC) on the US solar build. BNEF believes that the end of the ITC in 2016 will result in annual solar capacityadditions averaging 6GW/year from 2017 through 2022, down from an average of 8GW/year from 2014 to 2016. Whilecertainly impactful, the end of the ITC appears to be more disruptive than destructive to the growth of solar in the US.SEIA| Instapaper
SOLAR | LIFE AFTER THE ITC
Daniel Gross’s “The Night They Drove the Price of Electricity Down” profiles the unique attributes of the Texas electricitymarket that led to a night last March when wind electricity producers paid more than $8 per MWH to offload theirpower to the grid. Gross concludes, “In periods of slack overall demand and high wind production, it makes all theeconomic sense in the world for wind-farm owners to offer to sell lots of power into the system at negative prices.Only in Texas, folks. Only in Texas.”Slate | Instapaper
PAGE |
M&A TRANSACTIONS
3
RECENT M&A TRANSACTIONS1,2
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
Date Target Business Description Acquirer
10/15/2015 Spectraseis U.S. based provider of frac monitoring and stimulation evaluation
serv ices.
ESG Solutions
10/14/2015 Retroficiency U.S. based provider of energy efficiency analytics and building
intelligence software solutions.
Ecova
10/14/2015 PSI U.S. based provider of consulting, engineering, and testing serv ices for
commercial and industrial clients, as well as government projects.
Intertek Group
10/9/2015 Enercore Projects Canada based provider of engineering, procurement, and construction
management serv ices for oil sands, upstream, and downstream
projects.
Clough Limited
10/6/2015 Hybrid Tool Solutions U.S. based provider of a patent pending process for conducting frac
plug drill outs for the oil and gas industry.
Hastings Equity Partners
10/6/2015 Canexus Corporation Canada based specialty chemical prov ider and provider of
hydrocarbon transloading serv ices to the oil and gas industry.
Superior Plus Corp.
10/5/2015 Willbros Group,
Professional Serv ices
Segment
U.S. based energy infrastructure contractor serv ing the oil, gas, refining,
petrochemical, and power industries in the U.S.
TRC Companies Inc.
10/2/2015 SSM Solar Canada based developer and operator of solar projects. Canadian Solar
9/30/2015 Chesapeake Waste
Solutions
U.S. based company specializing in waste-to-energy disposal, offering
turnkey solutions for thermal destruction of various waste materials.
Covanta Holding
9/28/2015 President Engineering
Group
U.K. based company engaged in the design and manufacturing of
precision valves for LNG and industrial gas applications.
Parker Hannifin
Corporation
9/28/2015 Plasco Energy Group Canada based company utilizing proprietary technology to convert
municipal solid waste into green power and other products.
RMB Advisory Serv ice
9/25/2015 Gulf Coast Downhole
Technologies
U.S. based manufacturer and supplier of down hole equipment for the
oil and gas industry.
Prysmian S.p.A.
9/8/2015 NEXTracker U.S. based provider of horizontal trackers for large-scale solar projects. Flex
9/2/2015 Ignite Energy Canada based oilfield serv ice company providing fluid production
hauling and management serv ices.
Vertex Resource Group
8/27/2015 Sinopacific Offshore &
Engineering
China based manufacturer and designer of liquid cargo handling
systems.
CIMC Enric Holdings
8/26/2015 Cameron International
Corporation
U.S. based provider of flow equipment products, systems, and serv ices
worldwide.
Schlumberger
8/25/2015 MMM Group Canada based provider of program management, planning,
engineering, geomatics, and environmental and advisory serv ices to
public and private sector clients internationally.
WSP Global Inc.
PAGE |
PUBLIC MARKETS OVERVIEW
4
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
Energy Equipment and Services
TEV / LTM EBITDA TEV / 2015E EBITDA
AVERAGE REVENUE GROWTH (2012 – 2014) AVERAGE REVENUE GROWTH (2014 – 2016P)
AVERAGE EBITDA MARGIN (2012 – 2014) AVERAGE EBITDA MARGIN (2014 – 2016P)
4.1x
4.4x
5.6x
5.8x
6.4x
6.5x
7.7x
7.8x
16.9x
Land Drillers
Offshore Drillers
Small Cap Service
Logistics
OCTG
Equipment
Large Cap Service
E&C
Distribution
(3.0%)
(2.8%)
4.6%
5.4%
6.4%
7.8%
8.2%
12.4%
12.6%
E&C
OCTG
Land Drillers
Large Cap Service
Distribution
Small Cap Service
Logistics
Offshore Drillers
Equipment
(21.5%)
(14.4%)
(12.2%)
(11.4%)
(9.3%)
(9.3%)
(8.6%)
(7.9%)
(3.0%)
Land Drillers
Large Cap Services
Equipment
OCTG
Offshore Drillers
Distribution
Small Cap Service
Logistics
E&C
4.9x
5.9x
6.2x
7.2x
7.3x
8.4x
10.1x
10.3x
10.8x
Offshore Drillers
Land Drillers
Logistics
OCTG
E&C
Equipment
Small Cap Service
Large Cap Service
Distribution
6.4%
10.8%
18.6%
19.9%
20.4%
20.7%
30.8%
33.8%
43.3%
Distribution
E&C
OCTG
Small Cap Service
Large Cap Service
Equipment
Land Drillers
Logistics
Offshore Drillers
4.2%
11.7%
13.6%
15.4%
19.6%
20.4%
28.5%
29.6%
39.4%
Distribution
E&C
Small Cap Service
OCTG
Equipment
Large Cap Service
Land Drillers
Logistics
Offshore Drillers
PAGE |
PUBLIC MARKETS OVERVIEW
5
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
Power Equipment and Services
9.2x
10.7x
11.3x
Large Cap
Mid and Small-Cap
EE and Cleantech
10.1x
10.2x
12.3x
Large Cap
Mid and Small-Cap
EE and Cleantech
(3.4%)
7.4%
12.5%
Large Cap
Mid and Small-Cap
EE and Cleantech
0.3%
3.8%
20.5%
Large Cap
Mid and Small-Cap
EE and Cleantech
(13.0%)
16.1%
17.1%
EE and Cleantech
Large Cap
Mid and Small-Cap
(12.0%)
15.7%
17.0%
EE and Cleantech
Large Cap
Mid and Small-Cap
TEV / LTM EBITDA TEV / 2015E EBITDA
AVERAGE REVENUE GROWTH (2012 – 2014) AVERAGE REVENUE GROWTH (2014 – 2016P)
AVERAGE EBITDA MARGIN (2012 – 2014) AVERAGE EBITDA MARGIN (2014 – 2016P)
PAGE |
PUBLIC MARKETS OVERVIEW
6
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
Infrastructure Services
5.8x
7.7x
8.5x
9.7x
11.3x
Large Cap
Utility Services
Industrial Services
Mid and Small-Cap
Engineering Svc
6.4x
6.8x
6.9x
8.1x
8.1x
Utility Services
Mid and Small-Cap
Large Cap
Engineering Svc
Industrial Services
6.0%
6.2%
8.0%
9.6%
9.6%
Large Cap
Mid and Small-Cap
Industrial Services
Engineering Svc
Utility Services
6.3%
7.2%
7.5%
10.1%
10.8%
Large Cap
Mid and Small-Cap
Industrial Services
Utility Services
Engineering Svc
7.1%
7.9%
11.6%
13.1%
14.2%
Mid and Small-Cap
Large Cap
Utility Services
Engineering Svc
Industrial Services
2.0%
6.1%
6.9%
7.6%
18.4%
Large Cap
Mid and Small-Cap
Industrial Services
Utility Services
Engineering Svc
TEV / LTM EBITDA TEV / 2015E EBITDA
AVERAGE REVENUE GROWTH (2012 – 2014) AVERAGE REVENUE GROWTH (2014 – 2016P)
AVERAGE EBITDA MARGIN (2012 – 2014) AVERAGE EBITDA MARGIN (2014 – 2016P)
PAGE |
INDUSTRY STATISTICS
7
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
(Indexed to 100%)
TRAILING TWELVE MONTHS
Commodity Prices
25%
50%
75%
100%
125%
Oct-14 Jan-15 Apr-15 Jul-15 Oct-15
Natural Gas (NYMEX:^NG) Crude Oil (NYMEX:^CL) Coal (NYMEX:^QL)
Price Change From
Current Prior Month Prior Year Prior Month Prior Year
Natural Gas ($ per MMBtu) $2.87 $2.80 $3.98 2.6% (27.8%)
Crude Oil ($ per bbl) 47.16 45.00 81.20 4.8% (41.9%)
Coal (CAPP) ($ per ton) 41.93 42.50 51.83 (1.3%) (19.1%)
PAGE |
INDUSTRY STATISTICS
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 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
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
'15
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
'15
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
'15
37
25
47
94
47
55
-
71
62
124
300
266
North Sea
Africa
Europe
Asia Pacific
Middle East
Latin America
Offshore Land
8
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
'15
PAGE |
INDUSTRY STATISTICS
9
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
U.S. OIL RIG COUNT BY REGION U.S. GAS RIG COUNT BY REGION
Rig Counts3
% YTD CHANGE IN U.S. OIL RIG COUNT BY REGION % YTD CHANGE IN U.S. GAS RIG COUNT BY REGION
148
0
0
1
2
3
5
5
6
13
22
24
34
65
67
230
Others
Fayetteville
Marcellus
Haynesville
Ardmore Woodford
Barnett
Arkoma Woodford
Utica
Granite Wash
Mississippian
DJ-Niobrara
Gulf of Mexico
Cana Woodford
Williston
Eagle Ford
Permian
(60%)
(82%)
(80%)
(79%)
(78%)
(67%)
(64%)
(64%)
(56%)
(50%)
(45%)
(43%)
(13%)
0%
0%
0%
Others
Mississippian
Barnett
Granite Wash
Utica
Ardmore Woodford
Eagle Ford
Williston
Permian
Haynesville
DJ-Niobrara
Gulf of Mexico
Cana Woodford
Arkoma Woodford
Fayetteville
Marcellus
65
0
0
0
3
3
3
4
5
5
5
7
12
15
23
46
Others
Mississippian
Williston
Ardmore Woodford
Arkoma Woodford
Cana Woodford
Barnett
Fayetteville
Permian
DJ-Niobrara
Granite Wash
Gulf of Mexico
Eagle Ford
Utica
Haynesville
Marcellus
(33%)
(78%)
(72%)
(67%)
(50%)
(50%)
(42%)
(42%)
(40%)
(40%)
(39%)
(29%)
(14%)
0%
0%
0%
Others
Granite Wash
DJ-Niobrara
Barnett
Fayetteville
Cana Woodford
Utica
Gulf of Mexico
Marcellus
Arkoma Woodford
Haynesville
Permian
Eagle Ford
Mississippian
Williston
Ardmore Woodford
PAGE |
OUR GROUP
Harris Williams & Co. is a leading advisor to the energy, power, and infrastructure M&A market. Our Energy, Power &Infrastructure Group has experience across a broad range of sectors, including services, products, and technologiesthat support or enhance energy and power infrastructure.
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 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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PAGE |
Energy, Power& Infrastructure
IndustrialsHealthcare & Life Sciences
Transportation & Logistics
Aerospace, Defense & Government
Services
Business Services
Building Products & Materials
Technology, Media & Telecom
Specialty Distribution
Consumer
HARRIS WILLIAMS & CO. OFFICE LOCATIONS
UNITED STATES EUROPE
BostonTwo International Place24th FloorBoston, Massachusetts 02110Phone: +1 (617) 482-7501
Cleveland1900 East 9th Street20th FloorCleveland, Ohio 44114Phone: +1 (216) 689-2400
Minneapolis222 South 9th StreetSuite 3350Minneapolis, Minnesota 55402Phone: +1 (612) 359-2700
Richmond (Headquarters)1001 Haxall Point9th FloorRichmond, Virginia 23219Phone: +1 (804) 648-0072
San Francisco575 Market Street31st FloorSan Francisco, California 94105Phone: +1 (415) 288-4260
FrankfurtBockenheimer Landstrasse 33-3560325 FrankfurtGermanyPhone: +49 069 3650638 00
London63 Brook StreetLondon W1K 4HS, EnglandPhone: +44 (0) 20 7518 8900
NETWORK OFFICES
Beijing
Hong Kong
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New Delhi
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Energy, Power& Infrastructure
Harris Williams & Co. has a broad range of industry expertise, which creates powerful opportunities. Our clients benefit from our deep-sector experience, integrated industry intelligence and collaboration across the firm, and our commitment to learning what makes them unique. For more information, visit our website.
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
OUR FIRM
11
PAGE |
PUBLIC COMPARABLES
12
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
Stock Performance
Stock Price Change from 52-Week TEV / EBITDA EBITDA
TEV Oct-15 Sep-15 Prior Month Prior Year High % of High Oct-14 Apr-15 Current 2015E 2016P
Energy Services and Equipment
Large Cap Service
Schlumberger Limited $101,223 $75.01 $73.70 1.8% (15.7%) $100.54 74.6% 9.2x 9.0x 9.0x 10.2x 11.0x
Halliburton Company 38,146 38.72 37.20 4.1% (22.0%) 58.00 66.8% 7.0x 6.7x 13.4x 9.0x 8.5x
Baker Hughes Incorporated 26,148 55.01 53.08 3.6% 4.8% 70.45 78.1% 6.2x 7.6x 7.6x 14.4x 12.8x
Weatherford International plc 14,987 9.91 9.68 2.4% (37.6%) 18.00 55.1% 9.2x 7.6x 7.9x 10.6x 9.6x
Median 3.0% (18.8%) 70.7% 8.1x 7.6x 8.4x 10.4x 10.3x
Equipment
National Oilwell Varco, Inc. $16,961 $39.40 $38.64 2.0% (42.5%) $74.65 52.8% 6.6x 5.0x 4.5x 6.8x 9.0x
Cameron International Corporation 14,581 65.97 64.47 2.3% 18.9% 67.61 97.6% 9.0x 6.9x 8.7x 10.2x 11.8x
FMC Technologies, Inc. 8,510 33.96 32.54 4.4% (30.8%) 57.87 58.7% 9.7x 7.6x 6.9x 8.4x 10.2x
Oceaneering International, Inc. 5,105 46.01 40.31 14.1% (22.9%) 72.19 63.7% 7.7x 7.1x 6.4x 7.6x 8.0x
Dril-Quip, Inc. 2,110 64.40 64.14 0.4% (19.7%) 93.54 68.8% 9.7x 7.8x 6.9x 7.6x 10.2x
Oil States International Inc. 1,626 30.38 27.97 8.6% (47.9%) 60.71 50.0% 11.3x 5.7x 4.6x 8.9x 10.9x
Forum Energy Technologies, Inc. 1,622 13.75 13.84 (0.7%) (41.7%) 29.76 46.2% 8.5x 8.0x 6.5x 9.6x 10.7x
Median 2.3% (30.8%) 58.7% 9.0x 7.1x 6.5x 8.4x 10.2x
Mid and Small-Cap Service
Superior Energy Services, Inc. $3,584 $16.18 $13.64 18.6% (31.2%) $26.95 60.0% 4.7x 4.4x 3.8x 7.4x 7.8x
Ensign Energy Services Inc. 2,122 9.18 8.89 3.3% (31.5%) 13.84 66.3% 5.1x 4.7x 4.5x 6.6x 7.2x
TETRA Technologies, Inc. 1,841 7.07 6.95 1.7% (21.1%) 9.85 71.8% 11.8x 12.7x 9.6x 8.0x 7.8x
C&J Energy Services, Ltd. 1,757 5.30 3.86 37.3% (72.0%) 21.66 24.5% 6.4x 9.8x 9.4x 35.9x 25.3x
U.S. Silica Holdings, Inc. 1,133 17.95 17.74 1.2% (55.5%) 52.90 33.9% 11.6x 9.7x 5.8x 10.1x 9.9x
Calfrac Well Services Ltd. 1,080 3.40 4.00 (15.0%) (74.5%) 15.89 21.4% 6.6x 5.1x 4.0x 40.4x 10.3x
Basic Energy Services, Inc. 992 4.39 4.11 6.8% (64.1%) 16.22 27.1% 4.4x 4.4x 4.9x 30.0x 31.0x
Key Energy Services Inc. 851 0.71 0.59 21.2% (81.3%) 4.13 17.2% 7.5x 15.0x 31.4x NM 16.7x
Trican Well Service Ltd. 834 1.21 1.59 (23.9%) (88.3%) 11.38 10.6% 12.2x 7.0x 5.3x NM 12.4x
CARBO Ceramics Inc. 509 22.35 21.12 5.8% (55.6%) 57.79 38.7% 6.7x 8.4x 12.9x NM NM
Median 4.5% (59.8%) 30.5% 6.6x 7.7x 5.6x 10.1x 10.3x
OCTG
Tenaris S.A. $12,996 $12.28 $11.14 10.2% (23.3%) $15.84 77.5% 6.7x 6.4x 6.4x 8.9x 7.8x
PAO TMK 3,704 3.20 3.29 (2.7%) (58.8%) 8.10 39.5% 6.8x 5.0x 4.8x 5.5x 5.5x
Vallourec SA 3,470 10.59 9.64 9.8% (66.4%) 31.78 33.3% 7.3x 7.2x 7.4x NM 15.0x
Median 9.8% (58.8%) 39.5% 6.8x 6.4x 6.4x 7.2x 7.8x
Distribution
MRC Global Inc. $2,482 $12.83 $12.50 2.6% (35.5%) $22.81 56.2% 8.7x 7.2x 6.6x 10.8x 10.4x
NOW Inc. 1,852 17.60 16.19 8.7% (35.7%) 30.32 58.0% 12.0x 15.8x 27.2x NM NM
Median 5.7% (35.6%) 57.1% 10.3x 11.5x 16.9x 10.8x 10.4x
TEV / LTM EBITDA as of
PAGE |
PUBLIC COMPARABLES
13
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
Revenue Revenue Growth EBITDA EBITDA Margin Avg. Margin
2012 2013 2014 2015E 2016P '12-14 '14-16P 2012 2013 2014 2015E 2016P 2012 2013 2014 2015E 2016P '12-14 '14-16P
Energy Services and Equipment
Large Cap Service
Schlumberger Limited $41,731 $45,266 $48,580 $36,657 $38,007 7.9% (11.5%) $10,935 $12,224 $13,584 $10,264 $10,988 26.2% 27.0% 28.0% 28.0% 28.9% 27.1% 28.3%
Halliburton Company 28,503 29,402 32,870 24,543 25,822 7.4% (11.4%) 6,087 6,038 7,028 4,411 4,992 21.4% 20.5% 21.4% 18.0% 19.3% 21.1% 19.6%
Baker Hughes Incorporated 21,361 22,364 24,551 16,295 16,768 7.2% (17.4%) 3,803 3,647 4,847 1,902 2,504 17.8% 16.3% 19.7% 11.7% 14.9% 18.0% 15.4%
Weatherford International plc 15,215 15,263 14,911 9,796 10,192 (1.0%) (17.3%) 2,445 2,054 2,514 1,648 2,114 16.1% 13.5% 16.9% 16.8% 20.7% 15.5% 18.1%
Total $106,810 $112,295 $120,912 $87,291 $90,788 5.4% (14.4%) $23,270 $23,963 $27,973 $18,225 $20,597 21.8% 21.3% 23.1% 20.9% 22.7% 20.4% 20.4%
Equipment
National Oilwell Varco, Inc. $17,194 $19,221 $21,440 $15,522 $12,855 11.7% (22.6%) $4,005 $3,937 $4,495 $2,496 $1,915 23.3% 20.5% 21.0% 16.1% 14.9% 21.6% 17.3%
Cameron International Corporation 7,795 9,138 10,381 8,790 7,820 15.4% (13.2%) 1,220 1,362 1,642 1,432 1,254 15.7% 14.9% 15.8% 16.3% 16.0% 15.5% 16.0%
FMC Technologies, Inc. 6,151 7,126 7,943 6,765 6,094 13.6% (12.4%) 793 986 1,305 1,002 821 12.9% 13.8% 16.4% 14.8% 13.5% 14.4% 14.9%
Oceaneering International, Inc. 2,783 3,287 3,660 3,171 3,037 14.7% (8.9%) 605 747 858 674 639 21.7% 22.7% 23.4% 21.3% 21.0% 22.6% 21.9%
Dril-Quip, Inc. 733 872 931 864 747 12.7% (10.4%) 188 253 310 277 211 25.6% 29.0% 33.3% 32.0% 28.2% 29.3% 31.2%
Oil States International Inc. 1,518 1,629 1,820 1,138 1,021 9.5% (25.1%) 339 367 438 182 148 22.3% 22.5% 24.1% 16.0% 14.5% 23.0% 18.2%
Forum Energy Technologies, Inc. 1,415 1,525 1,740 1,142 1,067 10.9% (21.7%) 290 267 313 170 155 20.5% 17.5% 18.0% 14.9% 14.5% 18.6% 15.8%
Total $37,589 $42,799 $47,914 $37,392 $32,641 12.6% (16.3%) $7,439 $7,919 $9,361 $6,233 $5,143 19.8% 18.5% 19.5% 16.7% 15.8% 20.7% 19.3%
Mid and Small-Cap Service
Superior Energy Services, Inc. $4,293 $4,350 $4,557 $2,941 $2,742 3.0% (22.4%) $1,254 $1,140 $1,199 $491 $477 29.2% 26.2% 26.3% 16.7% 17.4% 27.2% 20.1%
Ensign Energy Services Inc. 2,197 2,098 2,322 1,471 1,501 2.8% (19.6%) 564 484 551 318 301 25.7% 23.1% 23.7% 21.6% 20.1% 24.2% 21.8%
TETRA Technologies, Inc. 881 909 1,078 1,140 1,142 10.6% 2.9% 123 96 111 234 234 13.9% 10.6% 10.3% 20.5% 20.5% 11.6% 17.1%
C&J Energy Services, Ltd. 1,112 1,070 1,608 1,745 1,757 20.3% 4.5% 336 202 232 48 76 30.2% 18.8% 14.4% 2.7% 4.3% 21.2% 7.2%
U.S. Silica Holdings, Inc. 442 546 877 663 697 40.9% (10.9%) 141 153 222 112 113 31.8% 28.0% 25.3% 16.8% 16.3% 28.4% 19.5%
Calfrac Well Services Ltd. 1,595 1,564 2,497 1,607 1,669 25.1% (18.2%) 257 188 357 23 98 16.1% 12.0% 14.3% 1.4% 5.9% 14.1% 7.2%
Basic Energy Services, Inc. 1,375 1,263 1,491 825 773 4.1% (28.0%) 297 231 313 32 34 21.6% 18.3% 21.0% 3.9% 4.3% 20.3% 9.7%
Key Energy Services Inc. 1,960 1,592 1,427 827 776 (14.7%) (26.2%) 421 269 118 21 55 21.5% 16.9% 8.3% 2.5% 7.1% 15.5% 6.0%
Trican Well Service Ltd. 2,213 2,115 2,704 1,289 1,166 10.5% (34.3%) 242 165 262 (26) 62 10.9% 7.8% 9.7% (2.0%) 5.3% 9.5% 4.3%
CARBO Ceramics Inc. 646 667 648 292 339 0.2% (27.7%) 204 172 159 (35) 17 31.6% 25.8% 24.5% (12.0%) 5.0% 27.3% 5.8%
Total $16,714 $16,175 $19,208 $12,798 $12,562 10.3% (18.0%) $3,839 $3,100 $3,523 $1,217 $1,467 23.0% 19.2% 18.3% 9.5% 11.7% 19.9% 11.9%
OCTG
Tenaris S.A. $10,834 $10,597 $10,338 $7,532 $7,646 (2.3%) (14.0%) $2,874 $2,764 $2,679 $1,394 $1,601 26.5% 26.1% 25.9% 18.5% 20.9% 26.2% 21.8%
PAO TMK 6,688 6,432 6,009 4,482 4,767 (5.2%) (10.9%) 1,006 929 782 661 682 15.0% 14.4% 13.0% 14.7% 14.3% 14.2% 14.0%
Vallourec SA 5,326 5,578 5,701 3,773 3,904 3.5% (17.2%) 826 914 846 (42) 219 15.5% 16.4% 14.8% (1.1%) 5.6% 15.6% 6.4%
Total $22,848 $22,607 $22,047 $15,787 $16,316 (1.4%) (14.1%) $4,706 $4,607 $4,307 $2,013 $2,502 20.6% 20.4% 19.5% 12.8% 15.3% 18.6% 14.1%
Distribution
MRC Global Inc. $5,571 $5,231 $5,933 $4,635 $4,680 3.2% (11.2%) $475 $389 $400 $224 $235 8.5% 7.4% 6.7% 4.8% 5.0% 7.6% 5.5%
NOW Inc. 3,414 4,296 4,105 3,110 3,240 9.7% (11.2%) 180 241 202 (38) 23 5.3% 5.6% 4.9% (1.2%) 0.7% 5.3% 1.5%
Total $8,985 $9,527 $10,038 $7,745 $7,920 6.4% (11.2%) $655 $630 $602 $186 $258 7.3% 6.6% 6.0% 2.4% 3.3% 6.4% 3.5%
PAGE |
PUBLIC COMPARABLES
14
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
Stock Performance
Stock Price Change from 52-Week TEV / EBITDA EBITDA
TEV Oct-15 Sep-15 Prior Month Oct-14 Prior Year High % of High Oct-14 Apr-15 Current 2015E 2016P
Energy Services and Equipment
Logistics
ATCO Ltd. $14,869 $39.50 $37.10 6.5% $45.76 (13.7%) $50.40 78.4% 8.7x 9.6x 9.6x 8.5x 7.4x
Tidewater Inc. 2,209 16.24 14.80 9.7% 36.70 (55.7%) 39.82 40.8% 7.3x 6.3x 5.8x 5.1x 9.5x
Bristow Group, Inc. 1,989 32.09 29.30 9.5% 66.33 (51.6%) 75.00 42.8% 10.0x 9.0x 7.2x 5.7x 6.1x
Hornbeck Offshore Services, Inc. 1,395 16.19 16.47 (1.7%) 25.64 (36.9%) 33.54 48.3% 6.1x 5.8x 5.1x 6.1x 6.7x
Gulfmark Offshore, Inc. 705 8.21 7.39 11.1% 28.05 (70.7%) 32.65 25.1% NM NM 6.2x 12.2x 11.9x
Civeo Corporation 669 1.94 1.74 11.5% 12.17 (84.1%) 13.17 14.7% 4.9x 3.1x 2.6x 5.0x 6.1x
Median 9.6% (53.7%) 41.8% 7.3x 6.3x 6.0x 5.9x 7.1x
Offshore Drillers
Transocean Ltd. $12,406 $16.07 $14.24 12.9% 28.97 (44.5%) 31.11 51.7% 5.0x 3.8x 3.6x 3.8x 7.8x
Ensco plc 8,606 16.83 15.48 8.7% 37.60 (55.2%) 41.99 40.1% 5.8x 4.2x 3.6x 4.4x 5.6x
Noble Corporation plc 8,277 12.27 11.76 4.3% 18.57 (33.9%) 22.35 54.9% 8.7x 6.4x 5.0x 5.0x 6.3x
Diamond Offshore Drilling, Inc. 5,191 19.56 21.99 (11.1%) 37.99 (48.5%) 40.74 48.0% 5.7x 5.8x 4.7x 5.6x 7.3x
Rowan Companies plc 5,155 20.01 16.67 20.0% 21.70 (7.8%) 25.35 78.9% 7.1x 5.9x 5.6x 5.5x 5.8x
Atwood Oceanics, Inc. 2,768 17.40 15.61 11.5% 38.33 (54.6%) 43.72 39.8% 6.8x 5.3x 3.7x 3.7x 4.9x
Hercules Offshore, Inc. 1,079 0.07 0.05 31.0% 1.47 (95.4%) 1.92 3.5% 3.9x 5.9x 14.4x NM 23.3x
Median 11.5% (48.5%) 48.0% 5.8x 5.8x 4.7x 4.7x 6.3x
Land Drillers
Nabors Industries Ltd. $7,051 $11.36 $9.77 16.3% 16.82 (32.5%) 19.38 58.6% 4.9x 4.8x 4.8x 6.2x 7.6x
Helmerich & Payne, Inc. 6,007 57.60 49.35 16.7% 78.37 (26.5%) 92.19 62.5% 5.2x 4.9x 4.0x 5.1x 9.3x
Precision Drilling Corporation 3,389 6.29 5.45 15.4% 9.39 (33.0%) 10.70 58.8% 5.1x 7.1x 6.5x 7.2x 7.4x
Patterson-UTI Energy Inc. 3,147 15.97 14.22 12.3% 21.72 (26.5%) 26.52 60.2% 4.1x 4.1x 3.5x 5.8x 8.6x
Pioneer Energy Services Corp. 540 2.99 2.50 19.6% 9.95 (69.9%) 11.91 25.1% 4.4x 3.4x 2.6x 5.1x 8.4x
Median 16.3% (32.5%) 58.8% 4.9x 4.8x 4.0x 5.8x 8.4x
Engineering & Construction
Subsea 7 SA $23,404 $69.00 $66.00 4.5% 80.00 (13.8%) 90.55 76.2% 19.9x 18.4x 18.1x 23.3x 33.7x
Saipem SpA 9,762 8.63 7.86 9.8% 15.07 (42.7%) 15.94 54.1% 10.2x 8.4x 27.7x 21.8x 7.4x
Technip SA 5,522 46.80 43.12 8.5% 58.28 (19.7%) 66.36 70.5% 6.0x 6.7x 5.9x 4.6x 5.0x
Petrofac Limited 4,362 9.15 8.07 13.5% 9.81 (6.7%) 12.03 76.1% 4.4x 6.6x 8.3x 8.1x 4.5x
McDermott International Inc. 1,568 5.17 4.65 11.2% 3.87 33.6% 5.93 87.2% NM 11.0x 7.0x 8.5x 7.2x
Median 9.8% (13.8%) 76.1% 8.1x 8.4x 8.3x 8.5x 7.2x
TEV / LTM EBITDA as of
PAGE |
PUBLIC COMPARABLES
15
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
Revenue Revenue Growth EBITDA EBITDA Margin Avg. Margin
2012 2013 2014 2015E 2016P '12-14 '14-16P 2012 2013 2014 2015E 2016P 2012 2013 2014 2015E 2016P '12-14 '14-16P
Energy Services and Equipment
Logistics
ATCO Ltd. $4,012 $4,359 $4,554 $4,449 $5,017 6.5% 5.0% $1,532 $1,678 $1,664 $1,733 $1,984 38.2% 38.5% 36.5% 38.9% 39.6% 37.7% 38.3%
Tidewater Inc. 1,060 1,230 1,418 1,526 1,130 15.7% (10.7%) 265 347 417 437 232 25.0% 28.2% 29.4% 28.6% 20.5% 27.5% 26.2%
Bristow Group, Inc. 1,199 1,344 1,516 1,881 1,841 12.4% 10.2% 263 291 291 330 300 22.0% 21.7% 19.2% 17.6% 16.3% 20.9% 17.7%
Hornbeck Offshore Services, Inc. 463 548 635 521 512 17.1% (10.2%) 192 255 284 233 211 41.4% 46.6% 44.7% 44.7% 41.2% 44.2% 43.5%
Gulfmark Offshore, Inc. 389 455 496 296 292 12.9% (23.3%) 103 159 172 58 62 26.5% 34.9% 34.7% 19.6% 21.3% 32.0% 25.2%
Civeo Corporation 1,109 1,041 943 535 468 (7.8%) (29.5%) 492 427 331 133 102 44.4% 41.0% 35.1% 24.9% 21.8% 40.2% 27.3%
Total $8,233 $8,977 $9,562 $9,208 $9,261 9.5% (9.8%) $2,847 $3,157 $3,159 $2,924 $2,891 34.6% 35.2% 33.0% 31.8% 31.2% 33.8% 29.7%
Offshore Drillers
Transocean Ltd. $8,773 $9,070 $8,952 $6,955 $4,819 1.0% (26.6%) $3,518 $3,505 $3,796 $3,079 $1,547 40.1% 38.6% 42.4% 44.3% 32.1% 40.4% 39.6%
Ensco plc 3,639 4,323 4,565 3,994 3,505 12.0% (12.4%) 1,814 2,201 2,348 1,935 1,516 49.8% 50.9% 51.4% 48.4% 43.2% 50.7% 47.7%
Noble Corporation plc 2,135 2,472 3,148 3,108 2,722 21.4% (7.0%) 1,053 1,189 1,559 1,658 1,313 49.3% 48.1% 49.5% 53.3% 48.2% 49.0% 50.4%
Diamond Offshore Drilling, Inc. 2,936 2,844 2,737 2,383 1,921 (3.4%) (16.2%) 1,337 1,186 1,133 933 684 45.5% 41.7% 41.4% 39.1% 35.6% 42.9% 38.7%
Rowan Companies plc 1,393 1,579 1,824 2,103 2,041 14.5% 5.8% 526 587 707 940 900 37.8% 37.2% 38.8% 44.7% 44.1% 37.9% 42.5%
Atwood Oceanics, Inc. 756 1,018 1,103 1,380 1,178 20.8% 3.3% 390 548 561 757 578 51.7% 53.8% 50.8% 54.9% 49.1% 52.1% 51.6%
Hercules Offshore, Inc. 618 858 900 372 464 20.7% (28.2%) 170 277 282 (32) 42 27.5% 32.3% 31.3% (8.6%) 9.0% 30.4% 10.6%
Total $20,250 $22,164 $23,230 $20,295 $16,650 12.4% (11.6%) $8,809 $9,493 $10,386 $9,270 $6,580 43.5% 42.8% 44.7% 45.7% 39.5% 43.3% 40.2%
Land Drillers
Nabors Industries Ltd. $6,843 $6,152 $6,804 $3,786 $3,008 (0.3%) (33.5%) $1,966 $1,680 $1,753 $1,132 $904 28.7% 27.3% 25.8% 29.9% 30.0% 27.3% 28.6%
Helmerich & Payne, Inc. 3,138 3,374 3,706 2,955 2,119 8.7% (24.4%) 1,278 1,400 1,559 1,124 633 40.7% 41.5% 42.1% 38.0% 29.9% 41.4% 36.6%
Precision Drilling Corporation 2,041 2,030 2,351 1,614 1,588 7.3% (17.8%) 477 637 631 473 458 23.4% 31.4% 26.8% 29.3% 28.9% 27.2% 28.3%
Patterson-UTI Energy Inc. 2,723 2,716 3,182 1,905 1,622 8.1% (28.6%) 990 841 986 540 364 36.4% 31.0% 31.0% 28.3% 22.4% 32.8% 27.3%
Pioneer Energy Services Corp. 919 960 1,055 542 456 7.1% (34.3%) 248 236 266 109 58 26.9% 24.6% 25.2% 20.1% 12.7% 25.6% 19.3%
Total $15,664 $15,232 $17,099 $10,802 $8,792 6.2% (27.7%) $4,959 $4,794 $5,194 $3,378 $2,416 31.7% 31.5% 30.4% 31.3% 27.5% 30.8% 28.0%
Engineering & Construction
Subsea 7 SA $6,297 $6,297 $6,870 $4,960 $4,080 4.5% (22.9%) $1,044 $858 $1,345 $996 $694 16.6% 13.6% 19.6% 20.1% 17.0% 16.6% 18.9%
Saipem SpA 13,124 11,841 12,873 11,850 10,671 (1.0%) (9.0%) 1,947 696 1,204 478 1,342 14.8% 5.9% 9.4% 4.0% 12.6% 10.0% 8.7%
Technip SA 8,204 8,848 10,074 11,582 10,286 10.8% 1.0% 1,002 1,001 984 1,243 1,107 12.2% 11.3% 9.8% 10.7% 10.8% 11.1% 10.4%
Petrofac Limited 6,240 6,329 6,241 7,015 7,879 0.0% 12.4% 842 1,013 887 551 986 13.5% 16.0% 14.2% 7.8% 12.5% 14.6% 11.5%
McDermott International Inc. 3,642 2,659 2,301 3,160 2,645 (20.5%) 7.2% 410 (251) 72 184 215 11.3% (9.4%) 3.2% 5.8% 8.1% 1.7% 5.7%
Total $37,506 $35,974 $38,359 $38,566 $35,562 (1.2%) (2.3%) $5,245 $3,317 $4,492 $3,452 $4,344 14.0% 9.2% 11.7% 8.9% 12.2% 10.8% 11.0%
PAGE |
PUBLIC COMPARABLES
16
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
Stock Performance
Stock Price Change from 52-Week TEV / EBITDA EBITDA
TEV Oct-15 Sep-15 Prior Month Prior Year High % of High Oct-14 Apr-15 Current 2015E 2016P
Power Services and Equipment
Large Cap Equipment and Services
General Electric Company $586,378 $27.60 $24.95 10.6% 14.5% $28.68 96.2% 22.8x 22.8x 20.9x 29.6x 27.4x
Siemens Aktiengesellschaft 87,955 83.95 102.60 (18.2%) (1.0%) 106.31 79.0% 10.1x 11.9x 11.1x 9.2x 8.6x
Honeywell International Inc. 77,128 98.26 99.62 (1.4%) 14.0% 107.41 91.5% 9.9x 11.5x 10.8x 9.8x 9.1x
ABB Ltd. 42,275 17.66 18.22 (3.1%) (10.6%) 22.31 79.2% 10.1x 9.0x 7.8x 8.6x 8.0x
Schneider Electric SE 35,947 50.64 55.30 (8.4%) (11.1%) 75.29 67.3% 10.8x 12.3x 9.3x 8.9x 8.3x
Emerson Electric Co. 34,532 46.27 46.04 0.5% (21.8%) 65.94 70.2% 9.2x 9.1x 7.6x 7.8x 8.5x
Eaton Corporation plc 33,042 52.75 55.72 (5.3%) (10.7%) 73.82 71.5% 10.4x 11.3x 9.3x 9.3x 8.8x
Alstom SA 12,405 28.11 28.60 (1.7%) 10.2% 30.20 93.1% 6.2x 33.5x 30.6x 28.3x 24.6x
Median (2.4%) (5.8%) 79.1% 10.1x 11.7x 10.1x 9.2x 8.7x
Mid and Small-Cap Equipment and Services
Ametek Inc. $14,443 $54.11 $53.22 1.7% 17.3% $57.67 93.8% 12.4x 13.6x 13.7x 13.1x 12.3x
Hubbell Inc. 5,436 88.24 95.09 (7.2%) (13.7%) 117.03 75.4% 10.3x 10.6x 9.1x 9.8x 8.7x
Valmont Industries, Inc. 2,899 103.00 103.41 (0.4%) (23.1%) 139.31 73.9% 7.4x 8.0x 7.7x 8.7x 7.9x
Littelfuse Inc. 1,981 93.51 91.77 1.9% 16.9% 103.08 90.7% 9.4x 11.8x 11.1x 10.7x 9.4x
AZZ incorporated 1,688 52.28 51.28 2.0% 23.8% 56.46 92.6% 10.3x 9.7x 10.2x 10.9x 9.7x
ESCO Technologies Inc. 1,004 37.36 35.74 4.5% 10.8% 39.73 94.0% 10.9x 12.5x 12.0x 11.6x 10.0x
Badger Meter Inc. 927 59.70 57.92 3.1% 17.8% 65.87 90.6% 12.4x 15.8x 15.3x 15.6x 13.6x
Thermon Group Holdings, Inc. 717 21.40 21.66 (1.2%) (5.1%) 26.73 80.1% 9.9x 9.9x 9.2x 8.4x 9.4x
Powell Industries, Inc. 318 32.30 28.76 12.3% (24.4%) 51.33 62.9% 10.3x 16.4x 10.1x 8.2x 7.1x
Global Power Equipment Group Inc. 106 4.06 3.83 6.0% (66.0%) 15.59 26.0% 6.1x 9.4x 3.9x NM NM
Median 1.9% 2.8% 85.3% 10.3x 11.2x 10.2x 10.7x 9.4x
Energy Efficiency and Clean Technology
SolarCity Corporation $6,861 $46.85 $48.14 (2.7%) (5.8%) $63.79 73.4% NM NM NM NM NM
Itron, Inc. 1,583 34.50 28.30 21.9% (7.4%) 43.67 79.0% 9.2x 10.3x 13.1x 11.3x 8.1x
Silver Spring Networks, Inc. 578 13.91 12.68 9.7% 71.7% 15.20 91.5% NM NM NM NM 20.1x
Ameresco, Inc. 479 6.58 5.86 12.3% (4.1%) 8.38 78.5% 14.7x 12.2x 11.4x 11.0x 9.7x
OPOWER, Inc. 340 8.94 9.39 (4.8%) (49.2%) 18.74 47.7% NM NM NM NM NM
PowerSecure International, Inc. 273 12.15 12.61 (3.6%) 36.4% 16.94 71.7% NM 43.2x 21.8x 12.0x 6.3x
EnerNOC, Inc. 250 8.98 8.98 0.0% (31.8%) 19.04 47.2% 5.9x 6.2x 5.2x NM 7.0x
Echelon Corporation 1 0.60 0.58 3.4% (67.0%) 2.18 27.5% NM NM NM NM NM
Median 1.7% (6.6%) 72.6% 9.2x 11.2x 12.3x 11.3x 8.1x
TEV / LTM EBITDA as of
PAGE |
PUBLIC COMPARABLES
17
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
Revenue Revenue Growth EBITDA EBITDA Margin Avg. Margin
2012 2013 2014 2015E 2016P '12-14 '14-16P 2012 2013 2014 2015E 2016P 2012 2013 2014 2015E 2016P '12-14 '14-16P
Power Services and Equipment
Large Cap Equipment and Services
General Electric Company $100,149 $100,542 $106,758 $125,583 $131,877 3.2% 11.1% $29,728 $30,936 $31,492 $20,481 $22,051 29.7% 30.8% 29.5% 16.3% 16.7% 30.0% 20.8%
Siemens Aktiengesellschaft 99,396 99,404 90,768 83,523 87,551 (4.4%) (1.8%) 11,457 9,984 10,267 10,786 11,580 11.5% 10.0% 11.3% 12.9% 13.2% 11.0% 12.5%
Honeywell International Inc. 37,665 39,055 40,306 39,274 40,783 3.4% 0.6% 5,082 6,490 6,755 8,157 8,711 13.5% 16.6% 16.8% 20.8% 21.4% 15.6% 19.6%
ABB Ltd. 39,336 41,848 39,830 36,574 37,733 0.6% (2.7%) 5,240 5,705 5,483 5,162 5,625 13.3% 13.6% 13.8% 14.1% 14.9% 13.6% 14.3%
Schneider Electric SE 31,572 32,214 30,187 29,764 30,970 (2.2%) 1.3% 5,186 5,013 4,510 4,645 4,972 16.4% 15.6% 14.9% 15.6% 16.1% 15.6% 15.5%
Emerson Electric Co. 24,412 24,669 24,537 22,727 22,460 0.3% (4.3%) 4,751 4,766 4,885 4,470 4,397 19.5% 19.3% 19.9% 19.7% 19.6% 19.6% 19.7%
Eaton Corporation plc 16,311 22,046 22,552 21,886 22,584 17.6% 0.1% 2,350 3,307 3,586 3,638 3,911 14.4% 15.0% 15.9% 16.6% 17.3% 15.1% 16.6%
Alstom SA 26,573 25,971 7,890 6,746 7,542 (45.5%) (2.2%) 2,534 2,359 550 424 521 9.5% 9.1% 7.0% 6.3% 6.9% 8.5% 6.7%
Total $375,415 $385,749 $362,828 $366,077 $381,498 (3.4%) 0.3% $66,328 $68,560 $67,528 $57,763 $61,768 17.7% 17.8% 18.6% 15.8% 16.2% 16.1% 15.7%
Mid and Small-Cap Equipment and Services
Ametek Inc. $3,334 $3,594 $4,022 $4,086 $4,280 9.8% 3.2% $851 $934 $1,037 $1,119 $1,192 25.5% 26.0% 25.8% 27.4% 27.9% 25.8% 27.0%
Hubbell Inc. 3,044 3,184 3,359 3,523 3,671 5.0% 4.5% 535 574 592 586 643 17.6% 18.0% 17.6% 16.6% 17.5% 17.7% 17.3%
Valmont Industries, Inc. 3,030 3,304 3,123 2,852 2,896 1.5% (3.7%) 451 563 447 363 390 14.9% 17.0% 14.3% 12.7% 13.5% 15.4% 13.5%
Littelfuse Inc. 668 758 852 871 917 12.9% 3.7% 141 168 183 189 209 21.1% 22.1% 21.4% 21.7% 22.8% 21.5% 22.0%
AZZ incorporated 469 571 752 821 918 26.6% 10.5% 98 127 143 157 180 21.0% 22.3% 19.1% 19.2% 19.6% 20.8% 19.3%
Powell Industries, Inc. 691 641 648 660 600 (3.2%) (3.8%) 60 60 41 37 47 8.7% 9.3% 6.4% 5.5% 7.9% 8.1% 6.6%
Global Power Equipment Group Inc. 463 484 539 576 605 7.9% 5.9% 26 29 27 31 31 5.6% 6.0% 5.0% 5.4% 5.1% 5.5% 5.2%
ESCO Technologies Inc. 479 490 531 545 588 5.3% 5.2% 65 73 82 88 102 13.5% 14.9% 15.4% 16.2% 17.4% 14.6% 16.3%
Badger Meter Inc. 320 334 365 377 402 6.8% 4.9% 58 53 62 61 71 18.0% 15.8% 17.0% 16.0% 17.6% 16.9% 16.9%
Thermon Group Holdings, Inc. 272 284 277 305 323 0.9% 7.9% 58 71 72 85 78 21.4% 24.8% 26.1% 27.9% 24.3% 24.1% 26.1%
Total $12,769 $13,644 $14,468 $14,617 $15,199 7.4% 3.8% $2,342 $2,650 $2,687 $2,717 $2,945 18.3% 19.4% 18.6% 18.6% 19.4% 17.1% 17.0%
Energy Efficiency and Clean Technology
Itron, Inc. $2,178 $1,949 $1,971 $1,842 $1,965 (4.9%) (0.2%) $265 $178 $169 $160 $213 12.2% 9.1% 8.6% 8.7% 10.8% 10.0% 9.4%
Ameresco, Inc. 631 574 593 619 660 (3.1%) 5.5% 49 28 38 42 54 7.8% 4.9% 6.4% 6.8% 8.2% 6.4% 7.1%
EnerNOC, Inc. 278 383 472 423 456 30.3% (1.7%) 2 50 47 (13) (17) 0.6% 12.9% 10.0% (3.1%) (3.8%) 7.9% 1.1%
PowerSecure International, Inc. 162 270 257 388 462 25.9% 34.1% 9 21 (0) 25 45 5.8% 7.9% (0.1%) 6.5% 9.7% 4.5% 5.4%
SolarCity Corporation 127 164 255 380 750 41.8% 71.4% (70) (107) (237) (356) (425) (55.3%) (65.3%) (92.9%) (93.6%) (56.7%) (71.2%) (81.1%)
Silver Spring Networks, Inc. 197 327 191 282 325 (1.4%) 30.4% (82) (35) (80) 7 28 (41.5%) (10.7%) (41.9%) 2.4% 8.6% (31.4%) (10.3%)
OPOWER, Inc. 52 89 128 147 178 57.5% 17.7% (11) (12) (38) (19) (13) (21.8%) (13.1%) (29.7%) (13.2%) (7.4%) (21.5%) (16.8%)
Echelon Corporation 134 46 39 39 44 (46.2%) 6.6% (3) (3) (7) (6) 0 (2.6%) (6.0%) (18.4%) (14.3%) 0.0% (9.0%) (10.9%)
Total $3,759 $3,802 $3,906 $4,119 $4,840 12.5% 20.5% $159 $121 ($109) ($159) ($116) 4.2% 3.2% (2.8%) (3.9%) (2.4%) (13.0%) (12.0%)
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PUBLIC COMPARABLES
18
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
Stock Performance
Stock Price Change from 52-Week TEV / EBITDA EBITDA
TEV Oct-15 Sep-15 Prior Month Prior Year High % of High Oct-14 Apr-15 Current 2015E 2016P
Infrastructure Services
Large Cap Infrastructure Services
Chicago Bridge & Iron Company N.V. $6,600 $43.10 $42.49 1.4% (7.6%) $59.45 72.5% 6.3x 5.7x 5.2x 5.3x 5.3x
SNC-Lavalin Group Inc. 5,988 42.29 39.17 8.0% (10.8%) 49.16 86.0% 8.1x 9.9x 11.8x 9.9x 8.8x
Fluor Corporation 5,979 46.72 45.24 3.3% (24.1%) 69.69 67.0% 5.9x 5.6x 4.4x 4.9x 5.0x
Jacobs Engineering Group Inc. 5,210 40.65 40.19 1.1% (13.0%) 49.90 81.5% 8.1x 7.4x 6.2x 7.4x 6.8x
KBR, Inc. 2,058 18.88 17.03 10.9% 7.5% 20.77 90.9% NM NM NM 6.9x 6.1x
Median 3.3% (10.8%) 81.5% 7.2x 6.6x 5.7x 6.9x 6.1x
Mid and Small-Cap Infrastructure Services
Amec Foster Wheeler plc $4,099 $8.03 $7.56 6.2% (20.7%) $11.20 71.7% 9.9x 14.0x 13.6x 9.0x 8.4x
Tutor Perini Corporation 1,577 16.12 17.07 (5.6%) (34.1%) 29.25 55.1% 6.2x 6.9x 5.8x 5.7x 4.8x
Aecon Group Inc. 1,199 14.08 13.37 5.3% (0.7%) 14.99 93.9% 11.5x 9.6x 9.8x 6.9x 7.0x
Primoris Services Corporation 1,182 20.00 18.40 8.7% (14.1%) 29.57 67.6% 6.8x 6.9x 8.0x 6.9x 5.8x
Granite Construction Incorporated 1,168 32.66 34.04 (4.1%) 5.1% 39.09 83.6% 12.4x 9.6x 10.1x 7.0x 5.5x
Great Lakes Dredge & Dock Corp. 679 5.59 5.27 6.1% (9.8%) 8.73 64.0% 8.2x 10.1x 10.3x 7.0x 5.9x
Willbros Group Inc. 312 2.59 1.46 77.4% (61.5%) 7.75 33.4% 8.9x 16.3x 12.5x 10.3x 4.7x
Orion Marine Group, Inc 153 5.18 6.79 (23.7%) (41.3%) 12.10 42.8% 8.1x 7.2x 4.6x 4.2x 3.4x
Median 5.7% (17.4%) 65.8% 8.5x 9.6x 10.0x 6.9x 5.7x
Utility Services
Quanta Services, Inc. $5,663 $25.60 $24.40 4.9% (16.4%) $35.33 72.5% 9.7x 8.6x 8.2x 6.6x 5.9x
Dycom Industries Inc. 2,978 74.42 75.20 (1.0%) 184.4% 80.85 92.0% 7.4x 10.5x 11.8x 11.6x 8.6x
MasTec, Inc. 2,621 17.61 17.35 1.5% (21.9%) 29.41 59.9% 7.3x 6.6x 7.5x 7.6x 6.2x
MYR Group, Inc. 512 26.57 27.17 (2.2%) 13.4% 32.24 82.4% 5.2x 6.1x 5.5x 5.4x 5.0x
Median 0.2% (1.5%) 77.4% 7.4x 7.6x 7.8x 7.1x 6.1x
Industrial Services
EMCOR Group Inc. $2,856 $45.98 $45.51 1.0% 12.8% $48.89 94.0% 7.5x 8.4x 8.5x 7.7x 6.9x
Bilfinger SE 1,974 36.88 35.17 4.9% (23.3%) 60.11 61.3% 10.4x 9.1x 7.2x 7.3x 5.8x
Team, Inc. 1,042 33.35 42.64 (21.8%) (13.3%) 47.55 70.1% 11.0x 10.0x 12.0x 10.9x 8.9x
Aegion Corporation 882 18.60 18.17 2.4% 9.2% 20.00 93.0% 7.2x 6.8x 6.7x 7.3x 6.4x
Mistras Group, Inc. 635 18.13 14.19 27.8% 8.5% 21.60 83.9% 10.4x 10.3x 10.0x 9.1x 8.2x
Matrix Service Company 564 24.26 22.91 5.9% 12.6% 26.22 92.5% 6.4x 16.2x 19.1x 24.5x 5.9x
Furmanite Corporation 271 6.36 6.82 (6.7%) (13.2%) 9.28 68.5% 10.0x 10.0x 8.1x 8.1x 5.1x
Median 2.4% 8.5% 83.9% 10.0x 10.0x 8.5x 8.1x 6.4x
Engineering Services
AECOM $8,843 $29.21 $27.29 7.0% 3.9% $35.40 82.5% 8.3x 13.1x 12.0x 7.6x 7.5x
WSP Global Inc. 5,283 46.39 42.61 8.9% 43.7% 48.66 95.3% 12.2x 17.3x 20.2x 12.6x 11.2x
Stantec Inc. 3,344 31.83 29.83 6.7% (5.2%) 38.09 83.6% 12.5x 10.3x 11.3x 9.7x 8.7x
Tetra Tech Inc. 1,654 26.43 25.27 4.6% 8.2% 27.84 94.9% 10.5x 10.8x 11.1x 8.1x 7.3x
RPS Group plc 594 2.41 2.29 5.2% 7.1% 2.71 88.8% 7.1x 7.7x 7.6x 7.5x 6.9x
Median 6.7% 7.1% 88.8% 10.5x 10.8x 11.3x 8.1x 7.5x
TEV / LTM EBITDA as of
PAGE |
PUBLIC COMPARABLES
19
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
Revenue Revenue Growth EBITDA EBITDA Margin Avg. Margin
2012 2013 2014 2015E 2016P '12-14 '14-16P 2012 2013 2014 2015E 2016P 2012 2013 2014 2015E 2016P '12-14 '14-16P
Infrastructure Services
Large Cap Infrastructure Services
Chicago Bridge & Iron Company N.V. $5,485 $11,095 $12,975 $13,700 $14,108 53.8% 4.3% $515 $934 $1,176 $1,309 $1,285 9.4% 8.4% 9.1% 9.6% 9.1% 9.0% 9.2%
SNC-Lavalin Group Inc. 7,526 7,149 7,335 9,370 9,723 (1.3%) 15.1% 660 480 667 588 677 8.8% 6.7% 9.1% 6.3% 7.0% 8.2% 7.4%
Fluor Corporation 27,577 27,352 21,532 19,910 20,154 (11.6%) (3.3%) 946 1,397 1,409 1,220 1,214 3.4% 5.1% 6.5% 6.1% 6.0% 5.0% 6.2%
Jacobs Engineering Group Inc. 10,894 11,818 12,695 12,005 12,148 8.0% (2.2%) 695 766 774 730 766 6.4% 6.5% 6.1% 6.1% 6.3% 6.3% 6.2%
KBR, Inc. 7,770 7,214 6,366 5,457 5,150 (9.5%) (10.1%) 361 237 (232) 323 325 4.6% 3.3% (3.6%) 5.9% 6.3% 1.4% 2.9%
Total $59,252 $64,628 $60,902 $60,442 $61,284 7.9% 0.8% $3,178 $3,815 $3,794 $4,169 $4,267 5.4% 5.9% 6.2% 6.9% 7.0% 6.0% 6.4%
Mid and Small-Cap Infrastructure Services
Amec Foster Wheeler plc $4,088 $3,974 $3,993 $5,508 $5,663 (1.2%) 19.1% $319 $318 $302 $432 $442 7.8% 8.0% 7.6% 7.8% 7.8% 7.8% 7.7%
Tutor Perini Corporation 4,111 4,176 4,492 5,233 5,594 4.5% 11.6% 214 260 295 245 296 5.2% 6.2% 6.6% 4.7% 5.3% 6.0% 5.5%
Aecon Group Inc. 2,887 3,069 2,614 2,836 2,903 (4.8%) 5.4% 121 122 104 173 172 4.2% 4.0% 4.0% 6.1% 5.9% 4.1% 5.3%
Primoris Services Corporation 1,542 1,944 2,086 2,036 2,300 16.3% 5.0% 129 176 163 143 195 8.4% 9.1% 7.8% 7.0% 8.5% 8.4% 7.8%
Granite Construction Incorporated 2,083 2,267 2,275 2,430 2,665 4.5% 8.2% 110 61 115 167 207 5.3% 2.7% 5.0% 6.9% 7.8% 4.3% 6.6%
Great Lakes Dredge & Dock Corporation 588 731 807 899 940 17.1% 8.0% 70 79 74 100 112 11.9% 10.8% 9.1% 11.1% 11.9% 10.6% 10.7%
Great Lakes Dredge & Dock Corp. 1,834 1,891 2,027 1,239 1,196 5.1% (23.2%) 62 71 40 5 51 3.4% 3.7% 2.0% 0.4% 4.2% 3.0% 2.2%
Orion Marine Group, Inc 292 355 386 500 681 14.9% 32.9% 7 21 33 43 67 2.5% 6.0% 8.6% 8.6% 9.8% 5.7% 9.0%
Total $17,426 $18,406 $18,680 $20,680 $21,942 7.1% 8.4% $1,032 $1,109 $1,126 $1,308 $1,541 5.9% 6.0% 6.0% 6.3% 7.0% 6.2% 6.9%
Utility Services
Quanta Services, Inc. $5,920 $6,523 $7,851 $7,546 $7,781 15.2% (0.4%) $623 $689 $681 $648 $745 10.5% 10.6% 8.7% 8.6% 9.6% 9.9% 8.9%
Dycom Industries Inc. 1,201 1,609 1,812 2,010 2,444 22.8% 16.2% 128 175 180 256 343 10.7% 10.9% 9.9% 12.7% 14.0% 10.5% 12.2%
MasTec, Inc. 3,727 4,325 4,612 4,260 4,666 11.2% 0.6% 331 429 404 331 421 8.9% 9.9% 8.8% 7.8% 9.0% 9.2% 8.5%
MYR Group, Inc. 999 903 944 1,077 1,138 (2.8%) 9.8% 80 88 92 93 99 8.0% 9.7% 9.7% 8.6% 8.7% 9.1% 9.0%
Total $11,847 $13,359 $15,219 $14,893 $16,029 11.6% 6.5% $1,162 $1,380 $1,356 $1,328 $1,608 9.8% 10.3% 8.9% 8.9% 10.0% 9.7% 9.7%
Industrial Services
EMCOR Group Inc. $6,195 $6,334 $6,425 $6,637 $6,956 1.8% 4.1% $315 $305 $355 $367 $409 5.1% 4.8% 5.5% 5.5% 5.9% 5.1% 5.6%
Bilfinger SE 8,344 7,561 7,697 6,232 6,307 (4.0%) (9.5%) 455 444 297 260 343 5.5% 5.9% 3.9% 4.2% 5.4% 5.1% 4.5%
Team, Inc. 624 714 750 840 1,052 9.6% 18.4% 73 74 72 96 119 11.7% 10.4% 9.6% 11.4% 11.3% 10.6% 10.8%
Aegion Corporation 1,017 1,091 1,331 1,364 1,423 14.4% 3.4% 113 109 133 120 139 11.1% 10.0% 10.0% 8.8% 9.7% 10.3% 9.5%
Mistras Group, Inc. 437 529 623 721 721 19.5% 7.5% 60 61 63 69 77 13.7% 11.6% 10.1% 9.6% 10.6% 11.8% 10.1%
Matrix Service Company 739 893 1,263 1,355 1,502 30.7% 9.1% 43 49 79 25 94 5.8% 5.5% 6.3% 1.9% 6.3% 5.9% 4.8%
Furmanite Corporation 326 427 529 512 526 27.3% (0.3%) 22 37 34 35 50 6.7% 8.6% 6.4% 6.8% 9.4% 7.2% 7.5%
Total $17,682 $17,549 $18,619 $17,661 $18,487 14.2% 4.7% $1,081 $1,080 $1,032 $973 $1,229 6.1% 6.2% 5.5% 5.5% 6.6% 8.0% 7.5%
Engineering Services
AECOM $8,218 $8,153 $8,357 $18,155 $18,638 0.8% 49.3% $434 $460 $410 $1,046 $1,111 5.3% 5.6% 4.9% 5.8% 6.0% 5.3% 5.5%
WSP Global Inc. 1,258 2,016 2,902 4,427 5,040 51.9% 31.8% 109 151 221 430 535 8.7% 7.5% 7.6% 9.7% 10.6% 7.9% 9.3%
Stantec Inc. 1,554 1,832 2,075 2,408 2,548 15.6% 10.8% 216 247 282 333 372 13.9% 13.5% 13.6% 13.8% 14.6% 13.6% 14.0%
Tetra Tech Inc. 2,022 2,025 1,860 1,733 1,814 (4.1%) (1.3%) 208 129 152 199 216 10.3% 6.4% 8.2% 11.5% 11.9% 8.3% 10.5%
RPS Group plc 556 568 572 536 566 1.5% (0.5%) 70 74 78 74 78 12.6% 13.1% 13.7% 13.8% 13.8% 13.1% 13.8%
Total $13,607 $14,594 $15,767 $27,259 $28,605 13.1% 18.0% $1,036 $1,061 $1,143 $2,083 $2,313 7.6% 7.3% 7.3% 7.6% 8.1% 9.6% 10.6%
PAGE |
ENERGY & POWER
SOURCES
ENERGY, POWER & INFRASTRUCTURE
INDUSTRY UPDATE │ OCTOBER 2015
1. Capital IQ.
2. MergerMarket.
3. Baker Hughes.
DISCLOSURES
20
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