annual meeting of shareholders focus discipline growth

FOCUS DISCIPLINE GROWTH

• • •

Annual Meeting of Shareholders

May 17, 2018



• • •Cautionary Statements

Forward-Looking Information

Certain information presented in these remarks and in this presentation that is not historical factual information and/or based on current views

and assumptions and is subject to uncertainties may constitute forward-looking information within the meaning of securities laws. Actual results

could differ materially from a conclusion, forecast or projection contained in such forward-looking information. Forward-looking information may

relate to our future outlook and anticipated events or results and may include statements about Total Energy Services Inc. or its subsidiaries

(“Total Energy” or “Total”), including business operations, strategy and expected financial performance and condition. Forward-looking

statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as could",

"should", "can", "anticipate", "estimate", "intend", "plan", "expect", "believe", "will", "may", "continue", "project", "potential" and similar expressions

and statements, or negative versions thereof. In addition, any statement that may be made concerning future financial performance, ongoing

business strategies or prospects, and possible future action on our part, is also a forward-looking statement. Undue reliance should not be

placed on forward-looking information and statements. Whether actual results, performance or achievements will conform to our expectations

and predictions is subject to a number of known and unknown risks and uncertainties which could cause actual results to differ materially from

our expectations.

Certain material factors or assumptions were also applied in drawing a conclusion or making a forecast or projection as reflected in such

forward-looking information. Additional information about the material factors that could cause actual results to differ materially from the

conclusions, forecasts or projections in the forward looking information, details regarding the material factors or assumptions that were applied

in drawing such conclusions or making such forecasts or projections, and more exhaustive information on the risks and uncertainties can be

found in Total’s continuous disclosure documents, including but not limited to its most recent Annual Information Form which is available on

www.sedar.com

Non-IFRS Measures

EBITDA means earnings before interest, taxes, depreciation and amortization and is equal to net income before income taxes plus finance costs

plus depreciation minus finance income. Cashflow means cash provided by operations before changes in non-cash working capital items.

EBITDA is not a recognized measure under International Financial Reporting Standards (“IFRS”). Management believes that in addition to net

income, EBITDA is a useful supplemental measure as it provides an indication of the results generated by the Company’s primary business

activities prior to consideration of how those activities are financed, amortized or how the results are taxed in various jurisdictions. Readers

should be cautioned, however, that EBITDA should not be construed as an alternative to net income determined in accordance with IFRS as an

indicator of Total Energy’s performance. Total Energy’s method of calculating EBITDA may differ from other organizations and, accordingly,

EBITDA may not be comparable to measures used by other organizations.


• • •Corporate Information

Shares outstanding (at May 16, 2018) 46.2 million

Options outstanding (at May 16, 2018, $13.51 weighted avg. exercise price ) 3.3 million

Market capitalization (basic, at $12.50 share price) $580 million

Working Capital (1) (at March 31, 2018) $54.9 million

Long-term debt (2) (at March 31, 2018) $247.1 million

Property, Plant & Equipment (at March 31, 2018) $786.4 million

Director/Officer ownership,% 5.6%

Common share dividend $0.06/quarter

(1) Working capital equals current assets minus current liabilities. (2) Long-term debt plus obligations under capital leases, excluding current portion.


• • •Corporate Highlights

• Savanna integration substantially complete – expect at least $14

million of 2018 operating and SG&A cost savings (40% above original

$10 million target)

• Increased primary bank credit facilities to $290 million and extended

term to June 2021

• Refinanced $144.1 million of SVY debt resulting in ≈$5.0 million of

annual interest savings

• $67.5 million of SVY 7% notes to be repaid on May 25,2018 with

expected additional annual interest savings of ≈$2.0

• Commenced asset rationalization and relocation process in Q4 2017

• Entered into strategic alliance with Pason Systems to collaborate in

the development and deployment of drilling automation and

optimization technologies

• Record CPS sales backlog of $207.0 million at March 31, 2018


• • •Historical Financial Performance(in thousands of CDN dollars, except per share amounts and shares outstanding)

3 months ended

March 31

Year ended

December 31

2018 2017 2017 (5) 2016

Revenue $ 205,215 $ 84,532 $ 604,662 $ 197,800

EBITDA (1) 27,655 7,942 71,604 14,041

Cashflow 21,149 7,821 76,571 15,717

Net Income 3,328 (853) (3,703) (11,914)

Per Share, Diluted

EBITDA(1) $ 0.60 $ 0.25 $ 1.71 $ 0.45

Cashflow 0.46 0.25 1.82 0.51

Net Earnings 0.07 (0.03) (0.05) (0.38)

Total Assets $1,065,499 $ 635,240 $1,066,781 $ 522,599

Working Capital (2) 54,906 77,158 54,892 71,770

Long-term Debt (3) 247,087 58,053 257,845 46,557

Net Debt (4) 192,181 nil 202,953 nil

Shareholder’s Equity 550,732 466,149 546,574 364,302

Shares Outstanding (diluted, 000’s) 46,241 31,489 41,963 30,967(1) As defined under “Non-IFRS Measures”.(2) Working capital equals current assets minus current liabilities.(3) Long-term debt and obligations under finance leases, excluding current portions thereof.(4) Net Debt equals long-term debt plus obligations under finance leases plus current liabilities minus current assets. (5) Includes Savanna results from April 5, 2017.


• • •Q1 2018 Segment Performance(in thousands of CDN dollars unless otherwise indicated)

Three months ended

March 31, 2018

CDS RTS CPS WS Corporate Consolidated

Revenue $ 60,980 $ 22,312 $ 85,118 $ 36,805 $ - $ 205,215

% of Consolidated 30% 11% 41% 18%

EBITDA $ 9,158 $ 4,599 $ 8,123 $ 9,685 $ (3,910) $ 27,655

EBITDA Margin 15.0% 20.6% 9.5% 26.3% 13.5%

Total Assets $ 462,672 $ 245,077 $ 197,264 $ 145,308 $ 15,178 $1,605,499


• • •2017 Segment Performance(in thousands of CDN dollars unless otherwise indicated)

Year ended

December 31, 2017(1)

CDS RTS CPS WS(1)

Corporate Consolidated

Revenue $ 158,051 $ 68,867 $ 266,376 $ 111,368 $ - $ 604,662

% of Consolidated 26% 11% 44% 19%

EBITDA $ 17,325 $ 14,157 $ 28,152 $ 28,699 $ (16,729)(2) $ 71,604

EBITDA Margin 11.0% 20.6% 10.6% 25.8% 11.8%

Total Assets $ 460,712 $ 239,876 $ 201,392 $ 142,574 $ 22,227 $1,066,781

(1) Includes Savanna results from April 5, 2017. WS was established with acquisition of Savanna.(2) Includes $7.6 million of non-recurring expenses related to the acquisition and integration of Savanna.


• • •Revenue Diversification

Canada50%United

States33%

Australia17%

Q1 2018 Revenue by Country

Canada55%

United States27%

Australia18%

2017 Revenue by Country

CDS30%

RTS11%

CPS41%

WS18%

Q1 2018 Revenue by Segment

CDS27%

RTS11%CPS

44%

WS18%

2017 Revenue by Segment


• • •

Operations Infrastructure

CurrentLocations

Australia


• • •Contract Drilling ServicesSavanna Drilling

• Diversified drilling rig fleet:

• Triples include 3 AC Velox and 1 mechanical

• Mechanical doubles have drilled 6,000 meter Duvernay and Montney horizontal wells

• Australian rigs purpose built for niche onshore CSG drilling market

• Rig fleet supported by extensive fleet of owned top drives, walking systems, pumps and

other ancillary equipment required to operate in most North American resource plays

• Fleet rationalization underway – disposed of 3 idle US rigs in Q1 2018

• Relocated 2 rigs from NEUS and 1 rig from Canada to Texas/Colorado in Q1 2018

• TDS fleet well positioned to meet increased drilling activity in W3/W4 oil plays

By type By Geography

Triples 4

AC doubles 15 Canada 86

Mechanical doubles 51 United States 25

Australian shallow 5 Australia 5

TDS and singles 41

116 116


• • •

• Leading provider of surface rental equipment and general oilfield

hauling in Western Canada with growing US presence

• Provide equipment and transportation services used in the drilling,

completion and production of oil and natural gas wells

• Current fleet of ~ 11,000 pieces of major rental equipment (excluding

access mats) and 112 heavy trucks based in 26 branch locations

throughout North America

• Continued relocation of equipment to US for higher rates and

utilization

• Pursue strategic consolidation opportunities to achieve

synergies/economies of scale

• Target high ROI organic investment opportunities

Rentals and Transportation ServicesTotal Oilfield Rentals


• • •Compression and Process Services

In business since 1988, Bidell is a

leading manufacturer of natural gas

compression equipment servicing

Canada, the NW US, NE US and

select international markets

All equipment offered for sale and

rental, including Bidell’s patented

NOMAD line of large HP mobile

compressor packages

Extensive parts and service

infrastructure in Western Canada

with a growing presence in the NW

US - full parts inventory, exchange

programs, overhaul and retrofit

services

Full scope and scale 100,000 sq ft

production facility in Weirton, WV

Authorized Packager/Distributor for

Ariel, Caterpillar and Waukesha

Established Spectrum in late 2012 to

provide additional exposure to North

American energy infrastructure build

Acquisition of Opsco Manufacturing

in Q1 2013 materially increased

market presence

Offer full service project

management, engineering, design

and procurement services

Specialize in design and fabrication

of large capacity dehydration,

regeneration, separation, line

heaters, free water knock outs and

custom manufactured process

equipment


• • •Well ServicingSavanna Well Servicing

• Operates a fleet of 87 service rigs across Western Canada, Northwest United

States and Australia

• Competitive Canadian service rig fleet supported by extensive infrastructure

• US service rigs have well established presence in the Bakken

• Australian service rigs incorporate latest technologies and are capable of

working in any existing onshore basin

• Fleet rationalization underway – disposed of 2 idle US service rigs in Q1 2018

By type By Geography

Singles 38 Canada 57

Doubles 36 United States 18

Australian spec 9 Australia 12

Flush-by 4

87 87


• • •

2018 Capital Expenditure Budget

$48 million 2018 capital budget:

• $24.0 million for equipment maintenance and upgrades

- includes $4.0 million of capital leases for light duty vehicles

• $24.0 million of growth capital:

- primarily targeting continued international expansion and

compression rental fleet additions in CPS segment

• $7.6 million of capital expenditures in Q1 2018

• $1.25 million of net proceeds from sale of idle equipment pursuant to asset

rationalization program


• • •

Contact Information

For further information about Total Energy Services Inc., contact:

Daniel Halyk, President & CEO,phone: (403) 216-3921, email: [email protected]

or

Yuliya Gorbach, VP Finance & CFOphone: (403) 216-3920, email: [email protected]

www.totalenergy.ca

TOTAL ENERGY, BIDELL, BIDELL EQUIPMENT, NOMAD, SPECTRUM PROCESS SYSTEMS and the Total Energy, Bidell, and Spectrum are registered trademarks of Total Energy Services Inc.

mailto:[email protected]

mailto:[email protected]

http://www.totalenergy.ca/

annual meeting of shareholders focus discipline growth

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