initial public offering - bos · pdf fileanalysis and review of bos solutions holdings inc....
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April 2017
Initial Public OfferingSolids and liquids separation, benefiting the environment
1
Advisory
An amended and restated preliminary prospectus containing important information relating to the securities described in this presentation has been filed with the securities regulatory authorities in each of the provinces of Canada, respectively. A copy of the amended and restated preliminary prospectus and any amendment thereto (collectively, the “amended and restated preliminary prospectus”), is required to be delivered with this presentation. The amended and restated preliminary prospectus is still subject to completion. There will not be any sale or acceptance of an offer to buy the securities until a receipt for the final prospectus has been issued. This presentation does not provide full disclosure of all material facts relating to the securities offered. Investors should read the amended and restated preliminary prospectus, the final prospectus and any amendment for disclosure of those facts, especially risk factors relating to the securities offered, before making an investment decision.
The information contained in this presentation does not purport to be all‐inclusive or to contain all information that prospective investors may require. Prospective investors are encouraged to conduct their own analysis and review of BOS Solutions Holdings Inc. (“BOS” or the “Company”) and of the information contained in this presentation. Without limitation, prospective investors should read the entire amended and restated preliminary prospectus and final prospectus, and any amendments thereto, consider the advice of their financial, legal, accounting, tax and other professional advisors and such other factors they consider appropriate in investigating and analyzing BOS. An investor should rely only on the information contained in the final prospectus relating to the Offering (as defined in the amended and restated preliminary prospectus), which will include this presentation, and is not entitled to rely on parts of the information contained in the final prospectus to the exclusion of others. None of the Company, the Principal Shareholder (as defined in the amended and restated preliminary prospectus) or the Underwriters (as defined in the amended and restated preliminary prospectus) has authorized anyone to provide investors with additional or different information, and any such information, including statements in media articles about BOS, should not be relied upon.
Certain capitalized terms and abbreviations not otherwise defined herein have the meaning assigned to them in the amended and restated preliminary prospectus.
There is currently no market through which the Common Shares may be sold and purchasers may not be able to resell Common Shares purchased under this prospectus. This may affect the pricing of the Common Shares in the secondary market, the transparency and availability of trading prices, the liquidity of the Common Shares and the extent of issuer regulation. See “Risk Factors – Risks Related to the Offering” in the amended and restated preliminary prospectus.
An investment in the Common Shares is subject to certain risks that should be considered by potential purchasers. It is important for potential purchasers to consider the particular risk factors that may affect the Common Shares and industry in which they are investing. Investors should carefully consider the risks described in this prospectus under the heading “Risk Factors” in the prospectus prior to making an investment in the Common Shares.
Market and Industry Data
Certain information obtained from the Spears DPO Report and Spears OMR Report and from the Stax Report has been disclosed in this presentation with the consents of Spears and Stax, respectively. A copy of the Stax Report is available under the Company’s profile on the System for Electronic Document Analysis and Retrieval (“SEDAR”) at www.sedar.com.
Non-IFRS Measures
Certain supplementary measures in this presentation, including “EBITDA”, “Adjusted EBITDA”, “Adjusted EBITDA Margin”, “Funds From Operations”, “Funded Debt to Covenant EBITDA”, “Funded Debt to Total Capitalization” and “Fixed Charge Coverage” do not have any standardized meaning as prescribed under IFRS (as defined herein) and, therefore, are considered non-IFRS measures. BOS believes these measures provide supplemental financial information that is useful in the evaluation of the Company’s operations and that other oil and natural gas service companies commonly use similar measures. These measures are identified within the amended and restated preliminary prospectus and presented with reconciliations to the equivalent IFRS measure. However, they should not be used as an alternative to IFRS measures because they may not be consistent with calculations of other companies. These non-IFRS measures, and certain operational definitions used by the Company, are further explained in Appendix “A” – IFRS and Non-IFRS Measures in the amended and restated preliminary prospectus.
United States Matters
The securities offered under the prospectus have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or the securities laws of any state of the United States and may not be offered or sold within the United States absent registration under, or an available exemption from, the registration requirements of the U.S. Securities Act and the securities laws of all applicable states. This presentation and the prospectus do not constitute an offer to sell or a solicitation of an offer to buy any of the securities offered hereby within the United States.
2
Advisory
Forward-Looking Statements
Certain statements contained in this presentation constitute “forward-looking statements” or “forward-looking information” within the meaning of applicable securities legislation (collectively, “forward-looking statements”). These statements relate to management’s expectations about future events, results of operations and the Company’s future performance (both operational and financial) and business prospects. All statements other than statements of historical fact are forward-looking statements. The use of any of the words “anticipate”, “plan”, “continue”, “estimate”, “expect”, “strategy”, “future”, “expand”, “new”, “going forward”, “will”, “project”, “believe”, “potential”, and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. No assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this prospectus should not be unduly relied upon. Unless otherwise indicated, these statements speak only as of the date of this prospectus. In addition, this prospectus may contain forward-looking statements and forward-looking information attributed to third-party industry sources. In particular, this presentation contains forward-looking statements pertaining to the following: the Offering Price, the completion, size, expenses and timing of the Offering and the number of Common Shares offered pursuant to the Offering; the anticipated Common Share consolidation; anticipated first quarter results; the Company’s capitalization following completion of the Offering; the exercise of the Over-Allotment Option; the share capital of the Company and shareholder composition following closing of the Offering; the gross and net proceeds of the Offering and the use of the net proceeds of the Offering; anticipated recovery in drilling activity and the Company’s market; anticipated growth in rig count; supply and demand for oilfield services and industry activity levels; increased demand for the Company’s oilfield services; increased demand for the Company’s integrated services; the Company’s leverage to a recovery in North American drilling activity; maximum equipment utilization rates; estimates of the North American land rig count and North America footage drilled from 2016-2020; the Company’s objectives and competitive strengths; the Company’s ability to retain existing clients and attract new business; the Company’s “order book” and “bid book”; the estimates of the market size for BOS Integrated Services; the Company’s market share; Trends in environmental regulation and the Company’s anticipated future Job Counts.
For further details on the forward-looking statements contained in this presentation, see “Forward-Looking Statements” in the amended and restated preliminary prospectus.
3
Introducing BOS Solutions
Section 1 Introducing BOS Solutions
Section 2 BOS Oilfield
Section 3 BOS Integrated Services
Section 4 Primed for Growth
Section 5 Corporate & Offering Overview
Appendix A – B
Craig IvieCEO Notable Experience: National Oilwell Varco; ReedHycalog; Grant Prideco; Schlumberger
Jennifer Adams ChenCFO Notable Experience: Encana; Nexen; TransAlta; PwC
Rick GarlandSVP of Sales and MarketingNotable Experience: SCORE Solutions; Tesco; Derrick Corporation; Cheyenne Services
Marcel BoucherVP of OperationsNotable Experience: National Oilwell Varco; ReedHycalog; Schlumberger
KEY MANAGEMENT TEAM(MANAGEMENT OFFICES IN HOUSTON AND CALGARY)
THE BOS MANAGEMENT TEAM HAS OVER 100 YEARS OF EXPERIENCE(SELECTIVE PRIOR EXPERIENCE)
4
16%
16%
17% 8%
39%
4%
83%
17%
BOS offers a leading solution that improves efficiency, costs and reduces environmental impactMarket Leader in Liquids-Solids Separation
LEADING PROVIDER OF LIQUIDS AND SOLIDS SEPARATION 2016 BOS JOB COUNT BY MARKET(1)
Oilfield Exposure with Significant Opportunity to Grow Integrated Services
Bakken
Marcellus / UticaRockies
Permian
Eagle FordCanada
Strong Exposure to US Oilfield Activity Including the Permian Basin
BOS is a leading North American provider of customizable and scalable liquids-solids separation services; BOS’ proprietary process and technologies recycle fluids, reduce associated waste for disposal and provide customers with an environmental solution that lowers all-in project costs
BOS is a productivity partner – its proprietary solutions typically reduce the overall project costs of oilfield drilling (“BOS Oilfield”) and other industrial applications (“BOS Integrated Services”) while minimizing the impact to the environment
The BOS process:
Reduces waste volumes and costs related to haul-off
Improves recycling of drilling fluids and water
Improves drill rates, equipment life and wellbore quality
BOS analytics provide data capture to our customers to assess performance and cost savings
In-house engineering expertise provides customizable solutions
Oilfield Integrated Services
USCanada
2016 BOS OILFIELD JOB COUNT BY REGION(1,2)
For footnotes, see Slide Footnotes on page 35.
5
Patented process and data analytics provide customized environmental solutionsHigh-Quality Equipment and Data Analytics
THE BOS SYSTEM DATA & PERFORMANCE ANALYTICS
BOS’ CLOSED-LOOP PROCESS ELIMINATES THE NEED FOR A DISPOSAL PIT, AND MARKET POTENTIAL IS EXPANDING
Traditional Disposal Pit Process Closed-Loop “Pitless” Drilling
BOS provides customized, patented and proprietary solutions Ability to provide customers with daily data analysis
BOS’ liquids-solids separation process reduces the environmental footprint at the wellsite.The industry’s increasing environmental regulations and sensitivity will broaden the Company’s market potential.
6
5
9 9 8
11 15
17
2014 2015 1Q '16 2Q '16 3Q '16 4Q '16 1Q '17
93 112 131 164
69 36 33 56 77 90
5
9 9 8
11 15 17
93 112
131 169
78 45 41
67 92 107
2011 2012 2013 2014 2015 1Q '16 2Q '16 3Q '16 4Q '16 1Q '17
Increasing Momentum: BOS market share of the rig count growth during 1Q ’16 to 1Q ’17 Oilfield market share grew from 4% in 2011 to 9% in 1Q 2017
Expanding market share with drilling recovery and growth from integrated servicesCompelling Investment Highlights and Growth Opportunity
BOS NORTH AMERICAN MARKET SHARE IS GROWING(4)
1,846 1,871 1,705 1,804943
486 803 956 1,094 1,197
417 363 351 378
189128
176 210 250 262
2,264 2,234 2,056 2,182
1,132
614979 1,167 1,344 1,458
2011 2012 2013 2014 2015 2016 2017E 2018E 2019E 2020E
US Canada
INTEGRATED SERVICES JOB COUNT (AVERAGE PER DAY)
OILFIELD RECOVERY IS UNDERWAY (RIG COUNT)(1)
BOS JOB COUNT (AVERAGE PER DAY)
138% Growth
22% CAGROilfield Integrated Services
2016
Differentiated Solutions ProviderProven, patented process that reduces costs
Customized solutions with engineering and data support
Leverage to US Oilfield Recovery (Permian)Approximately 70% of revenue is from the US oilfield market(2)US rig count has increased 107% since trough(3)Permian Basin is the Company’s largest market
Increasing Oilfield Market Share
Increasing share achieved in an expanding rig count environment Generated $46 MM in EBITDA(5) in 2014 with only 7.5% oilfield market share
Significant Additional Growth in Integrated ServicesPatented process successfully applies to other industriesJob Count increased from 5 in 2014 to 17 in 1Q 2017Significant North American market of over 800 potential jobs(6)
Beneficiary of tightening environmental regulations
2016
For footnotes, see Slide Footnotes on page 35.
3.8% 5.0%6.4% 7.5%
6.1% 5.2%7.5%
9.7% 10.3%8.9%
16.9%
2011 2012 2013 2014 2015 Q1 '16 Q2 '16 Q3 '16 Q4 '16 Q1 '17 1Q/1Q ∆
7
BOS Oilfield
Section 1 Introducing BOS Solutions
Section 2 BOS Oilfield
Section 3 BOS Integrated Services
Section 4 Primed for Growth
Section 5 Corporate & Offering Overview
Appendix A – B
8
Customized configurations that recycle fluids and reduce waste volumes to lower well costsThe BOS Solution
BOS’ POSITION IN THE DRILLING WASTE MANAGEMENT VALUE CHAIN
Drilling Fluid Drill Rig Liquids-Solids Separation Haul-Off Waste Disposal
Water and Drilling Fluid Recycling and Reuse
Recycles and reduces fluid use
Reduces wear on drilling equipment
Reduces waste volumes and haul-off
Less expensive disposal costs
Compact and mobile system which efficiently cleans the drilling fluid while drilling oil and gas wells
Proprietary closed-loop process separates and dries solids (rock cuttings) from the drilling fluid
Process returns drilling fluid to the drilling process for continued re-use
Waste volume is reduced and the resulting dry solids are easily transported for disposal via dump trucks
THE BOS ADVANTAGE(1)
The BOS closed-loop system is a leading solution to recycle fluids
and reduce waste volumes
9
Environmentally friendly solids control process improves overall efficiencyEnhancing the Performance of Solids Control
BOS REDUCES WELL COSTS FOR CUSTOMERS(2)
Traditional Disposal Pit Drilling Process
Fewer and Less Costly Trucks for Waste Disposal
Increased Recycling of Fluids with Associated Cost Savings
Closed-Loop “Pitless” Drilling with Environmentally Friendly Footprint and Lower Total Well Cost
Large Disposal Pit Required with Associated Environmental Risks
Limited Recycling and Reuse of Fluids Numerous and Expensive Vacuum
Trucks for Waste Disposal
The Solution
THE BOS SOLUTION(1)
Reduces Well Costs
Recycles drilling fluids and water
Reduces waste volumes and haul-off costs
Increasing Drilling Performance and Efficiency
Faster drilling and less wear on equipment (drill bits, motors)
Eliminates Pit and Environmental Remediation
The BOS solution is a closed-loop, “pitless” solution which
eliminates the need for the traditional disposal pit system
Minimizes Environmental Impact and Footprint
Compact and customizable designs tailored to customer with
significant market potential given increasing environmental
regulations across all industries
Seamlessly Switch Between Drilling Fluids
Dynamic and flexible for all drilling applications; ability to
easily switch between oil-based and water-based fluids
For footnotes, see Slide Footnotes on page 35.
Note: above images are illustrative and are not to scale.
10
US$78k
US$56k US$134k
Truck Savings Fluid SavingsDrying Shakers BOS System
Haul Off Solids Control Drilling Fluid
Cost Saving & Operational Benefits
REDUCING COSTS & INCREASING EFFICIENCY
Engineering and technology driven approach yields significant cost savings to customers
COST SAVING CASE STUDY – PERMIAN(2)
DRILLING SAVINGS ON A 4-WELL PAD
Savings
Faster Drilling
+
BOS SYSTEM OUTPERFORMED DRYING SHAKER SYSTEM(1)
Reduced Waste and
Disposal Costs
+Extended Drilling
Tool Life
+Improved Wellbore Integrity
+Lower Drilling
Fluid Costs
+
Change in Costs
(32%)
21%
(33%)
Total Savings of US$204k (25%)US$832k
US$628k
PROCESS COST PER WELL (EAGLEBINE)
For footnotes, see Slide Footnotes on page 35.
FewerDrilling Days
+
11
BOS able to grow along with their well-capitalized customersDiversified & Blue-Chip Customer Base
$87
$99
$112
$129
2016E 2017E 2018E 2019E
KEY CUSTOMERS
CUSTOMER BREAKDOWN (2016)(1) CUSTOMER CAPEX ($ BILLIONS)(2)
14% CAGR
Top-Tier Operators High-quality, active, large-cap operators with average
market capitalizations in excess of $1 billion
Diversified Customer Base Diversified customer base with no single customer
accounting for more than 11% of revenue in 2016
Operator Capital Budgets Increasing Growth-oriented customers focused in North
America’s most active basins with increasing capex
64% of revenue was generated by publicly listed customers with market capitalizations
above $1 billion
For footnotes, see Slide Footnotes on page 35.
Small16%
Large64%
Private20%
12
BOS Integrated Services
Section 1 Introducing BOS Solutions
Section 2 BOS Oilfield
Section 3 BOS Integrated Services
Section 4 Primed for Growth
Section 5 Corporate & Offering Overview
Appendix A – B
13
BOS is currently expanding its product offering to other end-market segments beyond its traditional oilfield market The job length of an integrated services job can last several weeks and, in some cases, multiple years
The BOS solution has been successfully applied in other industriesIntegrated Services Provides a New and Significant Market Opportunity
SUBSTANTIAL OPPORTUNITIES FOR INTEGRATED SERVICES ACROSS A WIDE RANGE OF INDUSTRIES
Construction Trenchless Technology Municipal & Utility Industrial
Description:Civil and construction projects that
involve dig outs, including tunneling, jet grouting and slurry
wall
Examples:Toronto Eglinton Ave. Subway
Expansion, Edmonton Ice District (Rogers Arena), Ottawa Sink Hole
Description:Horizontal and directional drilling services to tunnel under roads,
lakes, rivers and other obstacles
Examples:Northern Courier Pipeline Athabasca River Crossing
Description:Disaster relief and waste water management – sand recovery,
digester clean out, lagoon dewatering, and lagoon discharge
mitigation
Examples:San Jacinto River Authority Sludge
Residue Removal Project
Description:Agriculture, refining, mining, manufacturing and power
generation
Examples:Agriculture Settling Pond Clean-up
and De-watering Projects
“Remediation”
Attainable Market(1): 105 jobsPotential Addressable Market(2): 99 jobsTotal Addressable Market: 204 jobs
Attainable Market(3): 98 jobsPotential Addressable Market(4): 498 jobsTotal Addressable Market: 596 jobs
Total Remediation Sites(5): 2,724
Total: 800 Jobs
For footnotes, see Slide Footnotes on page 35.
14
5
9 9 8
11
15
17
2014 2015 1Q '16 2Q '16 3Q '16 4Q '16 1Q '17
$38,630
$19,055
TraditionalProcess
Trucking Costs Waste Disposal BOS System Cost
2016
Increasing Job Count and quality customer base demonstrate market penetrationPositive Momentum in Integrated Services
INTEGRATED SOLUTIONS VALUE PROPOSITION STRONG TRACTION IN BOS INTEGRATED SERVICES
SUBSTANTIAL CUSTOMER SAVINGS PER DAY(1)
Total savings of $19,575 per day (51%)PREMIUM CUSTOMERS
Significant Cost Reduction Lowers all-in costs for customers (e.g. savings achieved
through recycling of drilling fluid, less wear on equipment, and decreased waste volumes and haul-off)
Environmental Benefits Strong environmental benefits to reduce waste volumes, negate
need for waste pits, water conservation and reduced solids volumes for disposal
Smaller on-site footprint with lower customer project risk given substantial decrease in required truck traffic for hauling
Customized Project Design Engineering consultation and support creates customized
solutions tailored to specific project needs
JOB COUNT (AVERAGE PER DAY)
For footnotes, see Slide Footnotes on page 35.
NORTHERN CARRIER PIPELINE (TRANSCANADA)
15
Serving multiple industries and jurisdictions with cost savings and environmental benefitsBOS Integrated Services On-Site
Northern Courier Pipeline – Athabasca River Crossing (Alberta)
Over 8,000 m3 waste produced and disposed; BOS a key contributor to this record–breaking success.
“2016 Northwest Trenchless Project of the Year”(1)
Removal of jet grouting slurry waste
in connection with City of Ottawa Light Rail Transit project
Municipal Projects
Polymer-based piling drilling fluid liquid and solids
separation for Edmonton’s new
Hockey Arena
Edmonton Ice District (Rogers Place)
Removal of drilling waste from Eglinton
Crosstown Light Rail Transit
project
(Toronto, ON)
Record Setting HDD Project
Total savings of $19,575 per day
For footnotes, see Slide Footnotes on page 35.
16
Primed for Growth
Section 1 Introducing BOS Solutions
Section 2 BOS Oilfield
Section 3 BOS Integrated Services
Section 4 Primed for Growth
Section 5 Corporate & Offering Overview
Appendix A – B
17
BOS is positioned for exceptional future growthGrowth Strategies Aligned for Success
Capitalize on the Recovery in Oilfield (Permian) & Increased Drilling IntensityNorth American drilling activity tailwinds and complexity of modern day drilling to positively impact average Job Count per day
Pricing RecoveryPricing recovery and margin improvement anticipated as energy industry activity accelerates and BOS expands to new markets
Continue to Gain Market Share in Key Basins Capitalize on BOS’ market share improvements in key US resource plays and deepen penetration in other basins
Build Upon Early Success in the Emerging Integrated Services BusinessEnhance sales and marketing efforts and continue to target identified end-use markets
Maintain a Conservative and Financially Flexible Balance SheetPrudent capital structure allows BOS to capitalize on growth strategy
18
$2,526
$2,064 $4,590
Estimated Funding Shortfall Estimated InvestmentNeeded
Strong oilfield and infrastructure industry activity anticipated to support future growthImproving Industry Trends
NORTH AMERICAN LAND FOOTAGE DRILLED (MM FEET)(1) REQUIRED US INFRASTRUCTURE SPENDING (US$BN)(2)
SOLIDS CONTROL REVENUE PER RIG (INDEXED TO 2016)(3)
322 362 366 399281
161273 325 376 412
7469 75
83
47
32
4757
6974396
431 441482
327
193
320382
445485
2011 2012 2013 2014 2015 2016 2017E 2018E 2019E 2020E
US Canada
Operators are moving toward longer laterals and seeking drilling efficiencies
Service intensity in the solids control industry has been accelerating due to environmental regulations and increasing length of wellbore, resulting in
higher solids control revenue per rig
The new US Administration campaigned on a $1 trillion infrastructure plan to focus on inner cities, highways, bridges, tunnels, airports, schools and
hospitals
26% CAGR
23% CAGR
TRENDS DRIVING CURRENT AND FUTURE BOS REVENUE
Increased environmental regulations
Complexity of drilling fluids used by operators
More complex solids control systems required
Increased focus by operators on drilling/cost
efficiencies
0.5x
1.0x
1.5x
2.0x
2.5x
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
89% Increase
For footnotes, see Slide Footnotes on page 35.
19
3.8% 5.0%
6.4% 7.5%
6.1%
8.4% 8.9%
16.9%
2011 2012 2013 2014 2015 2016 1Q 2017 1Q/1Q ∆
63%
86%
107% 116%
147% 282%
Bakken Marcellus/Utica US Rockies Permian Canada
Proven track record of market share improvementsMarket Share Growth in the Oilfield
STRONG MARKET SHARE IN KEY BASINS(1,2) NORTH AMERICAN MARKET SHARE IMPROVING(2)
Market share gains due to continued investment in people, equipment and customer relationships through the commodity cycle
Expectation to grow market share in key basins across North America with potential near-term penetration or expansion into the following basins: Canada SCOOP/STACK
RIG COUNT RECOVERY IN KEY BASINS (May 2016 to April 2017) (4)
Activity and growth expected to continue given robust play economics at current commodity prices
Attractive economics foster continued activity in key BOS basins
AK
AB
ONND
CO
TX
PA
Permian
Rockies
Canada240
Petroleum Basins
Natural Gas Plays
Oil/NGL Plays
Corporate Office
District Office
Equipment Storage Facility
1Q 2017 Average Rig Count(3)
51
298
Bakken/Williston44
Marcellus/Utica63
8%
3%
7% 7%
'14 '15 '16 1Q '17
16% 17% 26% 35%
'14 '15 '16 1Q '1710%
8% 13%
7%
'14 '15 '16 1Q '17
29% 23% 20% 21%
'14 '15 '16 1Q '17
8% 7% 11%
13%
'14 '15 '16 1Q '17
Increasing Momentum: BOS market share of the rig count growth during 1Q ’16 to 1Q ’17
For footnotes, see Slide Footnotes on page 35.
20
Steady work in hand and more pendingIntegrated Services Order Book & Pipeline
SUMMARY ACTIVE REGIONS
BOS has realized early success in expanding and diversifying its service offering to other end-market segments beyond the oilfield and continues to build upon the momentum
During 1Q 2017, BOS Integrated Services had a Job Count of 17, and going forward there is strong near-term visibility on approximately 10 additional jobs and actively bidding on 20+ more jobs
BOS is actively bidding on various jobs throughout North America located in: Alberta British Columbia California Florida North Carolina Ontario Virginia Washington
6
TrenchlessTechnology
4
Construction
7
Industrial
1Q 2017 Average Daily Job Count (17)
+10
“Order Book” (1)
20
“Bid Book” (1)
BOS Integrated Services is active across a variety of industries with various types of jobs that can span longer horizons either on a contracted term or annual renewal basis
ORDER BOOK AND JOB PIPELINE FOR INTEGRATED SERVICES
For footnotes, see Slide Footnotes on page 35.
21
Corporate & Offering Overview
Section 1 Introducing BOS Solutions
Section 2 BOS Oilfield
Section 3 BOS Integrated Services
Section 4 Primed for Growth
Section 5 Corporate & Offering Overview
Appendix A – B
22
2011 2012 2013 2014 2015 2016
Job Count (average per day)
Oilf ield (jobs) 93 112 131 164 69 51
Integrated Services (jobs) 0 0 0 5 9 11
Total ( jo bs) 93 112 131 169 78 61
% Integrated Services (%) 0% 0% 0% 3% 11% 17%
Revenue ($ M M ) $92 $124 $158 $206 $91 $52
Cost of Services ($ M M ) $49 $82 $111 $145 $77 $54
Gross Margin (%) 47% 34% 29% 30% 16% (4%)
SG&A ($ M M ) $10 $8 $11 $14 $11 $11
Other Expenses/(Income) ($ M M ) $1 $1 $0 $0 ($1) ($1)
Adjusted EBITDA ($ M M ) $33 $33 $36 $46 $4 ($12)
Adj. EBITDA Margin (%) 35% 27% 23% 23% 4% (24%)
Revenue per Job Day ($ / jo b/ day) $2,718 $3,024 $3,284 $3,340 $3,212 $2,320
Revenue per Job Day (US$/job/day) $2,689 $3,023 $3,489 $3,024 $2,512 $1,751
Foreign Exchange Rate (USD/CAD) $1.01 $1.00 $0.94 $1.10 $1.28 $1.32
Field Equipment Additions ($ M M ) $87 $52 $5 $25 $4 $2
Job Capacity (jobs) 105 187 227 233 256 260
Average Utilization (%) (%) 88% 60% 58% 72% 30% 24%
36 33 56
77 90 9 8
11
15
17
45 41
67
92
107
1Q '16 2Q '16 3Q '16 4Q '16 1Q '17
Oilfield Integrated Services
Strong historical financial performance has given BOS a significant base from which to growHistorical Performance
HISTORICAL FINANCIAL SUMMARY JOB COUNT BY QUARTER138% increase with material contribution
from Oilfield and integrated Servicesthroughout from 1Q ’16 to 1Q ‘17
Strong margins and revenue per job day during normalized
levels of industry activity (prior to 2015); however, partially
impacted by high growth (e.g. hiring/training, internal system
build-out)
Margin Compression experienced in commodity
downturn largely due to pricing pressure and activity
levels
Significant capex in 2011-2012 equates to a capital light
business over the next few years as utilization increases
Approximately 91% of revenue is USD denominated
Fleet expansion undertaken as utilization increased in 2011
and 2012, setting the stage for future growth
HIGHLIGHTS
(2)
(1)
For footnotes, see Slide Footnotes on page 35.
23
--306090120150180
--
500
1,000
1,500
2,000
2,500
2014 2015 1Q'16 2Q'16 3Q'16 4Q'16 1Q'17 2017E2018E2019E2020E
Job CountR
ig C
ount
Rig Count Total Job Count
Oilfield Job Count
(48%)
(22%) (36%)
30% 29% 36%
(58%)
(18%) (7%)
68% 38%
17%
2015 1Q '16 2Q '16 3Q '16 4Q '16 1Q '17
Rig Count Oilfield Job Count
Historical operating levels and improving market shareCustomer Value Proposition Will Drive Future Growth
Outpacing Rig Count Growth
Increasing Momentum
Total Job Count Growing
Return to Normalized Revenue and Profitability
TOTAL JOB COUNT IS GROWING(3)
REVENUE AND PROFITABILITY IN NORMALIZED PERIODS
INCREASING OILFIELD MARKET SHARE (%)(2)
RIG COUNT vs. BOS OILFIELD JOB COUNT (% Change)(1)
$3,141 $3,340
Average(2012-2014)
2014
24% 23%
Average(2012-2014)
2014(4)
Customer focus on cost reductions and BOS’
differentiation is driving demand for BOS Oilfield
and outpacing rig count growth
BOS market share of the rig count growth from 1Q
’16 to 1Q ’17 was 16.9%
Increasing market share in the oilfield, coupled
with further penetration in integrated services, will
allow BOS to continue to outpace rig count
Improved pricing in an oilfield recovery will
enhance revenue per job day and margins
Revenue per Job Day EBITDA Margin
(4)
Increasing Momentum: BOS market share of the rig count growth during 1Q ’16 to 1Q ’17
FX (USD/CAD): $1.01 $1.10
For footnotes, see Slide Footnotes on page 35.
3.8% 5.0%6.4% 7.5%
6.1% 5.2%7.5%
9.7% 10.3%8.9%
16.9%
2011 2012 2013 2014 2015 Q1 '16 Q2 '16 Q3 '16 Q4 '16 Q1 '17 1Q/1Q ∆
24
Oilfield Market Share (%) 3.8% 5.0% 6.4% 7.5% 6.1% 8.4% 10.3% 8.9%
Job Count (average per day)
Oilfield (jobs) 93 112 131 164 69 51 77 90
Integrated Services (jobs) -- -- -- 5 9 11 15 17
Total Jobs ( jo bs) 93 112 131 169 78 61 92 107
Job Days (Jobs x Days in Period) (job days) 33,880 40,954 47,969 61,582 28,276 22,409 8,439 9,641
Revenue
Revenue per Job Day (C$/job/day) $2,718 $3,024 $3,284 $3,340 $3,212 $2,320
Foreign Exchange Rate (USD/CAD) $1.01 $1.00 $0.94 $1.10 $1.28 $1.32
Total Revenue (C $ M M ) $92 $124 $158 $206 $91 $52
Adjust. EBITDA Margin (%) 35% 27% 23% 23% 4% (24%)
2,264 2,234
2,0562,182
1,132
614746
1,016 979
1,167
2011 2012 2013 2014 2015 2016 4Q 2016 1Q 2017 2017E 2018E
BOS is strategically positioned as oilfield activity accelerates and integrated services expandsOutlook
Nor
th A
mer
ican
A
vg. L
and
Rig
Cou
nt(1
)
For footnotes, see Slide Footnotes on page 35.
OUTLOOK
Record 4Q market share with forecasted increase in rig count
BOS believes performance will be driven by key factors:
Anticipated acceleration in integrated services Job Count
Increasing revenue per job day due to anticipatedimprovement in industry trends and pricing
25
BOS’ investments in infrastructure and personnel have created a unique, customer-centric companyBOS Differentiation and Investment Highlights
CUSTOMIZEDENGINEERING
SOLUTION
EQUIPMENT,STAFF
& SAFETY
DATA ANALYTICS & CONFIRMED COST
SAVINGS
BOS is differentiated from other liquids-solids separation providers
Provides a cost savings solution to customers
Increasing market share in a risingrig count environment
Exposure to the growing Permian Basin
Additional growth via BOS Integrated Services
26
Management has a breadth of industry knowledge & experienceIndustry Leaders
30+ yearsexperience
15+ yearsexperience
35+ yearsexperience
10+ yearsexperience
Craig IvieChief Executive Officer
Jennifer Adams ChenChief Financial Officer
Rick GarlandSenior Vice President, Sales and Marketing
Marcel BoucherVice President, Operations
BOS MANAGEMENT TEAM
Mr. Ivie joined BOS in 2012 as Vice-President, Operations and was appointed President and CEO in 2015; Previously Director of Engineering at National Oilwell Varco (NOV), VP of Engineering at ReedHycalog; Mr. Ivie has a Bachelor of Science in Engineering from Montana College of Mineral Science and Technology.
Ms. Adams-Chen joined BOS in 2014 as Controller and was named Vice-President, Finance in 2015 and Chief Financial Officer in 2016; Previously held various finance related roles within Encana Corporation, Nexen Inc. and TransAlta Corporation; Ms. Adams Chen is a registered CPA with a Masters of Professional Accounting from the University of Saskatchewan and a Bachelor of Commerce from the University of Calgary.
Mr. Garland joined BOS in 2013 as the Senior Vice-President, Sales and Marketing in conjunction with BOS’s acquisition of SCORE Solutions where Mr. Garland was the founder and President; Previously Vice-President, Business Development at Tesco Corporation in addition to a variety of senior management positions at Derrick Corporation and Cheyenne Services Inc.
Mr. Boucher joined BOS in 2016 as Vice-President, Operations in 2016; Previously Director of Emerging Technology at National Oilwell Varco (NOV). Mr. Boucher has a Bachelor of Science in Mechanical Engineering from the University of Maine.
BOS Management Team Has Over 100 Years of Experience
27
BOARD OF DIRECTORS
Board of Directors has a breadth of industry knowledge & experienceIndustry Leaders
30+ yearsexperience
John DeaneBoard of Directors (Chairman) President of ReedHycalog from 2002-2008; under John’s leadership, ReedHycalog
grew ~ 20% market share, with $600MM+ in revenue and EBITDA of $200MM Vice President – Drilling Technologies, Schlumberger Notable positions at Camco and Reed Tool Currently serves on the Board of Directors at several private companies including
NCS Multistage and RGL Reservoir Management BS in Physics from Colorado School of Mines
25+ yearsexperience
David McKennaBoard of Directors Director of BOS since October 2010 Managing Partner of Advent International, where he coordinates Advent’s efforts in
the North American industrial sector Currently serves on the Board of Directors of NCS Multistage Inc., RGL Reservoir
Management Inc. and Serta Simmons Bedding LLC Previously served on the Boards of ABC Supply Co. Inc., Aspen Technology Inc.,
Boart Longyear, Bradco Supply and Keystone Automotive Operations Inc.
15+ yearsexperience
Gurinder GrewalBoard of Directors Director of BOS since October 2010 Managing Director of Advent International, where he focuses on buyouts in the
energy and industrials sectors Began his career with Donaldson, Lufkin & Jenrette, where he was a member of
the leverage finance team Currently serves on the Board of Directors of NCS Multistage Inc., Oleoducto
Central S.A. (Ocensa), RGL Reservoir Management Inc., Qualaand Culligan International Group
MBA from Harvard Business School
30+ yearsexperience
Craig IvieCEO & Board of Directors Joined BOS in 2012 as VP of Operations and was appointed CEO in 4Q15 Previously Director of Engineering at NOV, VP of Engineering at ReedHycalog BS in Engineering from Montana College of Mineral Science and Technology
30+ yearsexperience
Michael McShaneAdvisor to the Board Former Chairman and CFO, Grant Prideco Former Director and CFO, BJ Services Director, Superior Energy Services (NYSE: SPN) Director, Enbridge (NYSE: ENB) Director, Oasis Petroleum (NYSE: OAS) Director, Forum Energy Technologies (NYSE: FET)
Advi
sor
to th
e B
oard
30+ yearsexperience
John SchanckBoard of Directors Currently serves on the Board of Newfield Exploration; Serves on various
committee’s including operations and reserves, compensation and management development
Previously served as Director of Penn West Petroleum and as President and CEO of Sonde Resources; also served as the Managing Partner of Tecton Energy
Spent 21 years with Unocal Corp., where he lead Unocal’s exploration activities in both the US and internationally
MS in Geology from the University of Memphis, a BS in Geology from Allegheny College and an AA from Allegany College of Maryland
30+ yearsexperience
Alan FohrerBoard of Directors Currently serves on the Board of Directors and is the chair of the audit and risk
committee of TransAlta Corporation and concurrently serves on the Board of Directors of PNM Resources, Blue Shield of California and Synagro Technologies
Previously was Chairman and CEO of Southern California Edison Company and President and CEO of Edison Mission Energy; also served as Executive Vice President, Treasurer and CFO of both Edison and SCE from 1995 to 1999
Masters of Science in Civil Engineering from the University of California and a MBA from California State University
30+ yearsexperience
Alan KrauseBoard of Directors President of MWH Global, Inc., a subsidiary of Stantec Inc., an engineering and
construction company Became President and COO in 2008 and then was elevated to President and CEO
of MWH in 2011. Between 2012-2016, Krause was Chairman, CEO and President Appointed by the US Secretary of Commerce to represent the consulting and
engineering segment of the US environmental technology sector Masters in geological engineering from the University of Nevada Mackay School of
Mines
28
$90 million treasury offering at mid-point of marketing range ($12.50/share)Capitalization & Shareholder Composition
CAPITALIZATION (C$000) SHAREHOLDER COMPOSITION
As at Dec. 31, 2016
Current Pro Forma
Cash and Equivalents $4,307 $26,489
Debt (Credit Facility)
$58,918 $0
Equity $111,600 $192,700
TotalCapitalization $170,518 $192,700
Dec. 31, 2016 Pro Forma
ShareholderShares
Held (MM)
(% of FD)Shares
Held (MM)
(% of FD)
Advent International 12.3 96.0% 12.3 61.5%
Other 0.5 3.7% 7.7 38.3%
Shares Outstanding 12.8 99.7% 20.0 99.8%
Options(1)
(in the money) 0.0 0.3% 0.0 0.2%
Fully-Diluted Shares
Outstanding12.8 100.0% 20.1 100.0%
As at March 31, 2017, the Company had long term debt of approximately $65 million (excluding capital leases) which it intends to pay-off in full with
proceeds from the Offering, which will also provide $16.1 million to fund working capital, capital expenditures and other general expenses.
For footnotes, see Slide Footnotes on page 35.
29
Corporate and offering overviewSummary of the Offering
Issuer BOS Solutions Holdings Inc. (“BOS” or the “Company”)
PrincipalShareholder Advent Calgary (Luxembourg) S.à.r.l. (“Advent”)
Offering Size $90.0 million ($103.5 million assuming the Over-Allotment Option is exercised in full)
Offering Price Anticipated Offering Price between $11.00 and $14.00 per Common Share
Offering 6.4 million to 8.2 million Common Shares (excluding Over-Allotment Option)
Over-Allotment Option 15% of the Offering representing Common Shares purchased from the Principal Shareholder
Basic Shares Outstanding Upon
ClosingApproximately 20.0 million Common Shares (assuming the midpoint of the Offering Price range)
Retained Interest Advent will own or control an aggregate of 12.3 million Common Shares pro forma the Offering (61.7% of Pro Forma Common Shares Outstanding, assuming the midpoint of the Offering Price range, excluding Over-Allotment Option)
Use of Proceeds
The Company will use a portion of the net proceeds of the Offering to repay the outstanding indebtedness under the Credit Agreement and to provide a minimum of $10 million in cash proceeds for working capital as required by the Credit Agreement. The Company intends to use the balance of the net proceeds to fund capital expenditures, potential acquisitions and for general corporate purposes.
Form of Offering Initial public offering in all provinces of Canada pursuant to a long form prospectus.Private placement in the United States to “Qualified Institutional Buyers” pursuant to Rule 144A of the U.S. Securities Act.
Lock-up 180 days for the Company, Directors, Officers, Advent and other pre-closing security holders
Listing Applied to list on the Toronto Stock Exchange (“TSX”) under the symbol “BSS”
Pricing Date Expected the week of April 28, 2017
Closing Date Expected the week of May 1, 2017
30
Appendix A
Section 1 Introducing BOS Solutions
Section 2 BOS Oilfield
Section 3 BOS Integrated Services
Section 4 Primed for Growth
Section 5 Corporate & Offering Overview
Appendix A – B
31
Advisory
In accordance with Section 13.7(4) of National Instrument 41-101 General Prospectus Requirements, all the information relating to BOS™ comparables and any disclosure relating to the comparables, which is contained in the presentation to be provided to potential investors, has been removed from this template version for the purposes of its filing on the System for Electronic Document Analysis and Retrieval (SEDAR).
32
Appendix B
Section 1 Introducing BOS Solutions
Section 2 BOS Oilfield
Section 3 BOS Integrated Services
Section 4 Primed for Growth
Section 5 Corporate & Offering Overview
Appendix A – B
33
One of the most established and global private equity firmsAdvent International
PREMIER PRIVATE EQUITY SPONSOR
One of the Largest and Most Experienced Global Private Equity Investors
$42 billion in assets under management across developed and emerging
markets(1)
Invested in over 320 private equity transactions spanning 40 countries(2)
Over 190 investment professionals on 4 continents
42 investment partners with average of 16 years’ PE experience and 13 years
with Advent(3)
Deep Sector Expertise and Flexible Investment Approach
Focused on 5 core sectors with average of 26 years and 65+ investments in
most sectors
Industry knowledge enhances ability to support portfolio-company growth
Transaction flexibility allows Advent to tailor an investment to meet a company’s
specific needs
Returns Driven by Earnings Growth
Advent seeks industry-leading returns by partnering with management teams to
position companies for sustainable revenue and earnings growth
30+ years of Investment Experience; Over 320 transactions across four countries(2)
North America | Since 1984
Latin America | Since 1996
Europe | Since 1984
Asia | Since 198458 investment professionals 87 deals
40 investment professionals 54 deals
80 investment professionals 159 deals
14 investment professionals 25 deals
ESTABLISHED AND GLOBAL PRIVATE EQUITY FIRM
For footnotes, see Slide Footnotes on page 35.
34
Thank You
35
Slide 41. Job Count is the total number of deployments of equipment to a specific location for a specific customer outstanding at a specific
point in time, and, when measured over a period of time, represents the average per day.2. Job Count by area is aggregated based on how management assesses the performance of the business. Canada is inclusive of
the provinces of British Columbia and Alberta; Eagle Ford is inclusive of Eagle Ford, Haynesville and Barnett basins; Rockies isinclusive of the states Utah, Wyoming and Colorado.
Slide 6Note: Figures may not add due to rounding.1. 2011 – 2016 reflects Baker Hughes U.S. and Canadian land rig count; 2017E – 2020E reflects the Spears DPO Report (March
2017).2. For year-ending December 31, 2016.3. Baker Hughes rig count from May 2016 to April 2017.4. BOS Oilfield Job Count divided by Baker Hughes U.S. and Canadian land rig count in each period. 5. Adjusted EBITDA.6. Source: Stax Report.
Slide 81. BOS’ equipment configuration can vary by location and by customer job requirements.
Slide 91. The improvement reduced operating costs, and other operational benefit are based on management estimates and assumptions.
The size and nature of the benefits, if any, will vary dependent on the specifics of the project and the BOS solution utilized. 2. Illustrative example and not to scale.
Slide 101. Case study prepared based on well site data collected by BOS, customer provided information, and management estimates.
Study compared 3 wells utilizing dryer shaker system to 3 wells utilizing BOS system on one pad in the Eaglebine. Study accounted for reductions in waste haul-off and fluid costs as well as the relative costs of the two systems.
2. Case study prepared based on well site data collected by BOS, customer provided information, and management estimates. Study compared two wells in the Permian Basin, results extrapolated to four-well pad.
Slide 111. Source: FactSet, as at March 3, 2017. Based on BOS revenue in 2016. "Small" means less than $1 billion market capitalization
and “Large” means equal to or greater than $1 billion market capitalization each as calculated as at March 3, 2017. 2. Source: FactSet, as at March 3, 2017. Sum of median research consensus estimate capital expenditures for BOS’ publicly listed
customers and includes only those customers with 2016-2019 estimates.
Slide 131. Source: Stax Report. Based on civil projects in states that meet two of the following criteria: (i) high population density; (ii)
mountainous; (iii) expensive landfill tipping fees; (iv) stringent construction and demolition regulations.2. Source: Stax Report. Based on other civil projects most likely to involve groundwater or digging/excavation work with project
value of $10 million and above in 2015.3. Source: Stax Report. Based on pipeline projects occurring in a highly populated area in 2014.4. Source: Stax Report. Based on other pipeline projects occurring in a highly populated area.5. Source: Stax Report. Includes 1,324 superfund sites and 1,400 coal fly ash pits; because these projects are generally spread out
over 20+ years, the amount of spend needed for waste mitigation in a given year is somewhat limited.
Slide 141. Management estimate based on horizontal directional drilling project related to the Athabasca River crossing for the Northern
Courier Pipeline. The size and nature of the benefits, if any, will vary dependent on the specifics of the project and the BOS solution utilized.
Slide 151. North American Society for Trenchless Technology. Project represented the longest HDD installation of 42-inch diameter pipe in
North America. Source: Michels Canada.
Slide 181. Spears DPO Report (March 2017). Note. figures may not add due to rounding.2. American Society of Civil Engineers (2016 – 2025), 2017 Report Card for America's Infrastructure.3. Solids Control & Waste Management $ per Active Rig per Spears DPO Report.
Slide Footnotes
Slide 191. BOS Oilfield Job Count divided by Baker Hughes land rig count in each period. 2. Management uses market share data to assess the performance of the business in the basins and regions in which it operates.
Canada is inclusive of the provinces of British Columbia and Alberta; Bakken/Williston is inclusive of the Williston basin and the state of Montana; Rockies is inclusive of the states Utah, Wyoming and Colorado. The Permian and Marcellus/Utica are aggregated on the same basis as the Baker Hughes data.
3. Average 1Q 2017 Baker Hughes land rig count by basin.4. Reflects the changes in Baker Hughes land rig count between May 2016 and April 2017 (April 7, 2017).
Slide 201. BOS’ “order book” reflects management’s view of the status of ongoing negotiations and commitments with customers, and BOS’
“bid book” reflects projects in which BOS is actively bidding.
Slide 22Note: Revenue per job day not exact due to rounding.1. Total revenue divided by total job days in the given period. Job day is the Job Count for a specific time period multiplied by the
number of days in that time period.2. Based on BOS’ fleet of equipment and management’s estimate of a typical customer site configuration and assuming 100%
utilization.
Slide 231. Baker Hughes North American land rig count.2. BOS Oilfield Job Count divided by Baker Hughes North American land rig count.3. 2011 – 1Q 2017 reflects Baker Hughes U.S. and Canadian land rig count; 2017E – 2018E reflects the Spears DPO Report
(March 2017). Note. figures may not add due to rounding.4. Weighted average.
Slide 24Note: Revenue per job day may not be exact due to rounding.1. 2011 – 2016 reflects Baker Hughes U.S. and Canadian land rig count; 2017E – 2020E reflects the Spears DPO Report (March
2017). Note. figures may not add due to rounding.
Slide 281. 1,279,172 total options outstanding with a weighted-average share price of $13.68.
Slide 331. As of September 30, 2016. 2. As of September 30, 2016; includes investments made by Advent’s buyout programs (GPE, LAPEF and ACEE).3. As of December 31, 2016.