CORPORATE PRESENTATION

Transcription

1 CORPORATE PRESENTATION November 2015 sttenvirocorp.com SMART THINKING TECHNOLOGY

2 FORWARD LOOKING STATEMENT This presentation may contain forward looking statements that reflect current views, including the company s objectives, projections, outlook, estimates, expectations or predictions, and contain forward looking information with respect to future events. STT Enviro Corp. cautions that such information involves risk and uncertainty and that actual results could differ materially from those contained in them. In addition, certain material factors and assumptions were applied in drawing the conclusions or making the forecasts or projections contained in them which are subject to change. Additional information about the material factors that could cause the results to differ materially, and the material factors or assumptions that were applied, are contained in STT Enviro Corp s press releases, current financial statements and MD&A for first and second quarter 2015 and year ended 2014, all of which are available on SEDAR. 2

3 smart thinking & technology to save money for its industrial clients while improving an environmental outcome or minimizing the impact on the environment in each of its businesses. Business plan roll up of Niche market Environmental/Industrial companies where opportunity exists to dominate the sector

4 THE PILLARS OF OUR SUCCESS Cost Competitiveness Focused on reducing costs, improving efficiencies and leveraging partnerships internally and for our customers Strong Talent Engagement Culture Multidimensional experienced team who thrive on creative problem solving for our customers Environmental Commitment Concern over the environment is growing, it is a strong motivator to millennials and it is getting more and more regulated Capital Discipline Using cash and appropriately leveraged capital to ensure highly accretive acquisitions 4

5 BUSINESS STRUCTURE Corporate head office focused on major trends and marketing Corporate budget and financial goals Acquisition process Raising capital and capital allocation Major market trends and business cycles Current marketing relevance HR and talent engagement Business units focused on cash generation and efficiency Business unit management of operations Identification of sector opportunities both organic and acquisition Sales direction and goals Business unit budget and achievement Strategic relevance of current products and businesses 5

6 At Present: TWO BUSINESESS DRIVING ORGANIC GROWTH Cost saving engineering solutions that respect the environment TANKS & INDUSTRIAL STT Tanks & Industrial engineers and supplies liquid and bulk material storage and handling to the municipal, industrial, mining and oil & gas sectors in western Canada through its exclusive partnership with CST Storage. SYSTEMS & SOLUTIONS STT Systems & Solutions is focused on the long term management of (chemical make down) environmental systems to neutralize some industrial byproducts (mainly acidity). It currently provides this service throughout North and South America with global contracts in locations as distant as Southeast Asia. 6

7 STT ENVIRO CORP A growth story that has only just begun In four years the company has gone from almost insolvent to what is now a dynamic and fast growing engineering firm with 20% compounded growth and a strong sales backlog. $45,000 20% Compounded Growth Rate $40,000 $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 Growth at 20% Actual Achieved/Forecast $5,000 $

8 CAPITAL STRUCTURE AND SHARE PERFORMANCE Strong financial position to support growth Strong Financial Position $5.6 M in working capital $25 M in sales backlog Zero debt Share Structure (as at 04NOV15) Outstanding 46,772,525 Fully Diluted 51,412,525 Share Price Chart October 2013 October 2015 Avg. Daily Trading Volume , , ,714 8

9 THE FINANCIAL HISTORY A TURNAROUND With income growth and increased margins GROSS MARGINS NET INCOME EBITDA 31% $1.2M $2.5M $2.7M 19% 22% 24% 26% $853 $953 $1.0M $2.1M $2.2M $2.3 M FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 $1.5M 9

10 RESULT: DEBT REDUCTION & CASH GENERATION Debt free + unencumbered working capital of $5.6 M Debt Working Capital $7,000,000 $6,000,000 $5,000,000 $1,978,835 Current portion of term debt Long term portion of term debt Working Capital $1,458,955 $5,562,105 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $4,000,000 $537,166 $ $3,000,000 $2,000,000 $2,000,000 $4,000,000 $6,000,000 $1,000,000 $ $8,295, Mar Mar Mar Mar 14 TODAY 31 Mar 15 $8,000,000 $10,000,000 10

11 STT SYSTEMS & SOLUTIONS Chemical Makedown Systems Business Snapshot What we do: Engineering, project management and installation of complete systems including truck unloading, storage (silos), flow promotion, makedown systems, distribution and instrumentation and controls. Aftermarket and lifecycle support for systems customers (end users) to improve efficiency and reduce the operating cost of their systems. Sectors: Mining Oil & Gas Power Sales Reach: Global (but primarily) North America South America Australia Southeast Asia Market Cycle: Down part of the market cycle due to both the mining sector and oil price decline lead us to developing broader aftermarket business with great margins and growing rapidly. 11

12 STT SYSTEMS & SOLUTIONS Chemical Makedown Systems Competitive Advantages Own proprietary ZMI Portec Slaker technology for the oil & gas sector Over 1,000 installed systems Cost effective modular designs Exclusive agreement with Metso covering North and South America for the VERTIMILL Slaker. Patented Vertimill retrofit which improves slaking performance and reduces cost for customers On going research and development on lime slaking reactivity that can reduce their lime consumption by up to 40%. For a small mine in Ontario this meant savings of $350,000 annually or $1.7 million over 5 years Reoccurring revenue through service programs such as our Applied Care Program 12

13 STT TANKS & INDUSTRIAL Bolted tanks and silos Business Snapshot What we do: Supplies liquid and bulk material storage and handling through an exclusive agreement with CST Storage. Sectors: Oil & Gas Municipal Industrial Construction Sales Reach: Western Canada Market Cycle: Down part of the market cycle due oil prices made our cost effectiveness more relevant and we added new markets such as cement transload to Frac sand transload business. 13

14 STT TANKS & INDUSTRIAL Bolted tanks and silos Competitive Advantages Bolted tanks are 25 30% cheaper than the alternative (field welded) Construction time is 25 to 50% less Coatings last 2 4x longer Reduced environmental footprint Safer work and fewer workers Bolted silos can be deconstructed (versus cement for example) when no longer required Internal engineering expertise to provide the design for the elevators and conveyance systems for transload systems 14

15 REVENUE BY DIVISION BUILDING IN TOUGH TIMES Current Backlog $25 million $40,000,000 $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 Systems Tanks Solutions Current Backlog $25 million low oil prices are making bolted tanks a must consider technology in the oil business Scale of projects more large projects ($3 million to $15 million) than ever before. Margin Growth highest margin business has grown by over 125% New business sectors transload systems for chemical, cement, frac sand and fly ash $5,000,000 $ F 15

16 OUR NEXT PHASE OF GROWTH ACQUISITIONS Drivers A strong cash position and unleveraged capital allows highly accretive acquisitions. Financial backers an American following of family offices who see the value in the company and who financed the $2.5 million raise. Growing institutional interest. Top tier multidimensional engineering talent that can be applied to a variety of industries and applications POTENTIAL ACQUSITIONS SHOULD TICK THREE BOXES Provide recurring revenue Provide diversification Utilize our highly specialized team of engineers Add to our environmental offering TARGETS COULD BE In a niche market or a tuck in to current business Either public or private US is preferred, but not necessary 16

17 INVESTMENT HIGHLIGHTS A top quality operator with a growing international customer base Proven management success Projected 2015 revenue up over 250% since 2010 Increased gross margins to 31%, up 63% in 5years Eliminated debt Backlog has been built on growth in new sectors Both continued organic growth and targeted acquisitions will provide accretive growth and shareholder upside as well as revenue diversification 17

18 Contact Us Investor Relations Corporate Offices David Deacon, CEO Tel: Holly Hendershot, Director of Corporate Affairs Tel: Milton, Ontario Tel: Richmond, British Columbia Tel: