Attached files
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| 8-K - FORM 8-K - Edgen Murray II, L.P. | d8k.htm |
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Exhibit 99.1
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 1
This
presentation
is
based
on
management’s
current
beliefs
and
assumptions,
which
in
turn
are
based
on
currently
available
information.
We
remind
you
that
there
are
risks
and
other
uncertainties
that
could
impact
our
future
operating
results
and
financial
condition
and
cause
our
actual
results
to
materially
differ
from
any
forward-looking
statements.
Our
SEC
filings
contain
information
on
risk
factors,
uncertainties
and
assumptions
that
could
cause
actual
results
to
differ
materially
from
our
current
expectations.
Special Notice Regarding Forward-Looking Statements |
 2
Introductions-Today’s Presenters
Dan O’Leary –
President and CEO
David Laxton –
Executive Vice President and
CFO |
 3
Business Overview
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 4
Edgen
Murray Overview
Industrial
Distributor:
Specialty
steel
products
for
the
oil
and
gas,
power,
process,
petrochemical,
and
civil
construction
markets
25+
Year
Track
Record:
Formed
through
the
merger
of
Edgen
Corporation
and
U.K.
based
Murray
International
Metals
in
2005
Founded
in
1983,
Edgen
Corporation
was
a
supplier
of
premium
carbon
and
alloy
steel
products
in
the
Western
Hemisphere
Founded
in
1976,
Murray
International
Metals
provided
premium
steel
products
to
clients
in
Europe,
Middle
East
and
Asia
Global
Operations:
Managed
through
two
segments
Western
Hemisphere
(Americas)
and
Eastern
Hemisphere
(Europe/West
Africa,
Asia/Pacific,
and
the
Middle
East)
Over
14,000
SKU’s:
Including
highly-engineered
prime
carbon
or
alloy
steel
pipe,
pipe
components,
valves
and
high-grade
structural
sections
and
plate
Over
2,000
Customers
in
50
Countries:
Oil
and
gas:
upstream
(exploration
and
production),
midstream
(gathering,
pipeline
and
storage)
and
downstream
(refineries
and
processing)
Petrochemical
and
power
(hydrocarbon,
nuclear
and
renewable)
Other:
engineering,
procurement,
construction
and
civil
Diversified
Revenue
Base:
Both
project
and
MRO
revenues
MRO
orders
typically
account
for
30%
to
50%
of
our
sales
World
Class
Facilities
and
Technology
Platform
All
of
our
locations
are
either
certified
to
ISO
9001:2000
or
ISO
9001:2008
1H2010 Sales by End Market
1H2010 Sales by Segment
1H2010 Sales by Order Type
(1) |
 5
Global Distribution Network
Edgen Murray’s solution-driven approach meets customers’
needs on a global basis
UK
3 Sales Offices
2 Distribution Centers
(in 4 locations)
Azerbaijan
Stocking
Facility
Dubai, U.A.E.
Office /
Distribution Center
Singapore
Office /
Distribution Center
Australia
Sales Office
US
Corp. Headquarters
12 Sales Offices
13 Distribution Centers
(in 15 locations)
Canada
2 Sales Offices
2 Distribution
Centers (in 3
locations)
Saudi Arabia
Sales Office
Shanghai
Sales Office
Malaysia
Sales Office
India
Sales Office
Brazil
Sales Office
France
Sales Office |
     6
End Market Exposure
Offshore rigs
Production facilities
Compression
Gathering
Processing
LNG
Transmission
Storage
Gas Distribution
Refining
Petrochemical
Mining
Upstream
Midstream
Downstream /
Process
Other
Infrastructure
Power Generation
Fossil
Nuclear
Renewables
Civil Infrastructure |
 7
Specialized Product Portfolio
Edgen Murray is a single source for specialty carbon and alloy pipe, plate,
components, sections, and valves
Plate
Sections
Seamless Pipe
Welded Pipe
Full range
Carbon & Alloy
Fittings
Flanges
Full range of
thicknesses & process
treatments
Universal Beam / Column
Parallel Flange Channels
Rolled Steel Angle
Flat / Round / Square Bar
Hollow Sections
Full range of diameters and
gauges
Full range of diameters and
gauges
Valves
Specialty range including
ball, check, plug, butterfly
and needle
Components |
 8
Unique Distribution Model
High volume network
End-to-end inventory management
Vendors
Value-Add
Customers
Value-Add
Edgen Murray creates substantial value for both vendors and customers
Provide global market
access
Sales and marketing
support for specialty
products
Consistent, high-
volume purchaser of
specialty products
Reduced investment in
working capital
Customer risk
management
Broad product
catalogue
Volume purchasing
power
Capable of supplying
large volume projects
and MRO requirements
Ability to provide global
logistical support and
procurement services
Sales force offers
technical expertise and
consultation |
 9
Diversified, Global, Blue-Chip
Customer Base
Over 20 customers in 50 countries
Longstanding relationships
FY 2009 Top ten customers account for
26% of consolidated sales; six months
ended June 2010: 32%
Recognized leaders in their respective
industries
Large and well capitalized
Customers are driving spending
decisions
Customers participate in energy,
industrial and civil sectors
Strong mix of MRO and project orders
Selected Customers
Major /
National Oils
Engineering/
Construction
Power
Generation
Midstream
Refining/Petro
Mining |
 10
Long-Term MRO Relationships…
MRO relationships provide increased base level performance during the
business cycle troughs
Diversity and depth of inventory along with strategic location of distribution
facilities enable us to meet customer demand for expedited delivery
Supply agreements with customers create predictable demand for certain
products at normal margins while allowing for profit opportunities on
ancillary products and services
Integrated computer systems allow for high volume order turns, accurate
order fulfillment and on-time performance
1H2010 MRO sales accounted for approximately 40% of our sales
|
 11
…With Global Project Experience
We believe we are a critical supplier to clients operating in remote, challenging
regions Projects led by large, creditworthy sponsors
Complex projects in terms of size, scale and logistics
Provides significant potential for recurring revenue stream through MRO
opportunities Shell and Qatar Petroleum Pearl
GTL
Kinder Morgan Mid-Continent
Express
Motiva Crude Expansion
Intercostal Harvey Canal
Hurricane Protection
Ras Gas Barzan
Enbridge Southern Lights
Conoco Phillips Wood River
Expansion
Gulf Intercostal Waterway
Agip KCO (ENI subsidiary)
Kashagan Field
Enbridge Alberta Clipper
Dow Hemlock Expansion
Koniambo Nickel Project
Total Usan Field
Energy Transfer Tiger,
Haynesville and Fayetteville
Express Pipelines
Exxon Baytown Cat Feed
Expansion
Alcan Grove Alumina Project
Sakhalin Energy Investment
Company Sakhalin II
Bechtel Transcanada Pipeline
PDVSA Refining, Morichal and
Punta de Mata
Olmsted Lock and Dam
Woodside Pluto Field
Southern Union Florida Gas
Phase 8
Origin Energy New Zealand Kupe
Gas Plant
Nooter/Eriksen HRSG
Chevron Platong Gas 2
EXCO Barnett Shale
Shell Argentina Proyecto
Reactivacion Del Coker
Prairie State Energy Campus
Shell Peregrino
Regency Gas Barnett Shale
ANCAP Argentina Expansion
Southwestern Electric Combined
Cycle Plant
Selected Projects |
 12
World Class Facilities Supported by
Advanced Information Technology Platform
Edgen
Murray maintains state of the art stocking and distribution facilities in the U.S.,
Europe, Asia and the Middle East
All facilities are ISO certified and enable the Company to keep inventory in close
proximity to its customers
The Company operates on an advanced Oracle IT platform and product RFID
system In
the
process
of
fully
integrating
IT
system
between
operations
in
the
Western
and
Eastern
Hemispheres
to
allow
more
efficient
access
across
the
organization
Systems allow close coordination of management and reporting
Edgen
Murray Stocking and Distribution Facilities |
 13
Management has a proven track record of success in the industry
Many years of industry experience
Experience across upstream and downstream end markets, as well
as in the manufacturing of the products the Company distributes
Extensive global experience with senior managers located in key
markets around the world
Management team owns approximately 26% of the Company (on a
fully diluted basis)
Capital markets proven
Experienced Management Team |
 14
Our Corporate Strategy
Market:
Increase
the
size
of
our
addressable
market
and
our
overall
market
presence
Assets:
Leverage
our
investment
in
people,
locations,
inventory
and
systems
Supply:
Optimize
our
vendor
relationships,
purchasing
and
inventory
levels
Financial:
Manage
working
capital
to
maximize
cash
flow
from
operations
through
prudent
credit
analysis
and
aggressive
inventory
control
Leverage
our
sales
growth
through
selling,
general
and
administrative
expense
controls
Target
a
balanced
revenue
contribution
from
Eastern
and
Western
Hemispheres
Maintain
a
revenue
stream
balanced
between
project
business
and
recurring
MRO business
New
Opportunities:
Pursue
global
expansion,
emerging
segments,
strategic
investments,
specialty
product
additions
and
opportunistic
acquisitions
Eastern
Hemisphere:
Actively
farm
expanded
footprint
and
expand
alloy
product
sales
Western
Hemisphere:
Market
penetration
in
civil
construction
and
nuclear
power generation
Service:
Vigilant
client
coverage
in
an
effort
to
capitalize
on
deferred
maintenance
requirements
and
project
spending
pick-up |
 15
Financial Overview
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 16
Historical Summary Operating Performance
Cash
$918
$1,266
$773
$280
2007
2008
2009
1H-2010
$ millions
Total Revenue
Total Availability Under the ABL Revolver
$ millions
$ millions |
 17
Challenging Market Conditions…
Generally sluggish worldwide economic recovery
Uncertainty regarding future demand for oil and
natural gas and impact on prices
Difficult project finance environment
Excess competitor inventories
Extreme price competition |
 18
…But We Believe the Following are Attractive Long-Term Market
Dynamics
Increasing
global
demand
for
crude
oil
and
natural
gas
driven
by
population
growth
and
economic modernization
Conventional
producing
regions
confronting
rising
depletion
rates
and
geopolitical
instability
Producers
making
significant
capital
investments
in
new
/
remote
sources
of
supply
Unconventional
natural
gas
and
oil
resources
Off-shore
/
deepwater
oil
Unlocking
trapped
/
remote
gas
resources
New
production
infrastructure,
transmission
solutions
and
processing
capacity
required
Global
investment
in
power
generation
capacity
EIA
estimates
global
electricity
generation
will
increase
over
75%
by
2030
vs.
2006
Demand
for
renewable
projects
and
alternative
energy
resources
continues
to
increase
Growth
in
civil
construction
and
infrastructure
projects
Aging
infrastructure
and
massive
stimulus
packages
will
spur
global
spend |
 19
We believe we are well positioned to capitalize on market
stabilization in 2010 and growth beyond
Global Distribution Network
Diversified, Blue Chip Customer Base
End Market Exposure
Unique Distribution Model
Highly Specialized Product Portfolio
Long-Term MRO Relationships
Global Project Experience
Liquidity Through the Cycle
Attractive Market Dynamics
Experienced Management Team
Strong Shareholder Support |
 20
Plant Tour
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 Houston, Texas
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 Houston, Texas
22 |
 Houston, Texas
23 |
 Houston, Texas
24 |
 Houston, Texas
25 |
 Edinburgh, Scotland
26 |
 Edinburgh, Scotland
27 |
 Edinburgh, Scotland
28 |
 Dubai,
U.A.E. 29 |
 Dubai,
U.A.E. 30 |
 Singapore
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 Singapore
32 |
 Singapore
33 |