2. Bar Source International, LLC
Providing Highest Quality
Carbon and Alloy Bars
Comprehensive Inventory
&
Distinctive Customer Service
3. Low Cost Mill Distributor of Specialty
Carbon and Alloy Bar Products
National Stocking Locations
“No Frills” Master Distributor
Call Us First
Low Overhead Translates into Competitive Pricing
Low Cost Supplier
We Value Our Customers
Sales Driven Organization with a Focus on Asset Management
--Inventory
--Accounts Receivables
--People
--Equipment
--Suppliers
--Customers
BSI Management Philosophy:
Entire Team Sells Every Day
Unique Management Capabilities:
4. BSI, LLC Models Inventory Management to Current Customer Base...
Get on Board the BSI Team!
BSI Operating Components:
-- Commitment to Customer Service
-- BSI Aims to be the “Partner of Choice” for Customers
Targeted Specialty Bar Quality(SBQ) Steel
-- Strategically Focused on Repeatable Program and Contract Business:
Sales Programs, JIT, Blanket Orders, Contract Programs
-- Broad In-House Inventory Selection and Processing Tailored to Customer
Requirements
-- Inventory Tailored to Current Customer Requirements
-- Customized Stocking Programs Geared Specific Customers
-- Complete Logistics Management
-- Source Customer Requirements Worldwide
BSI Values
-- Type of Company: Financially Stable, Entrepreneurial, Growth Oriented
-- Sell Nationally
-- Procure through proven quality sources
5. Bar Source International
Mission Statement
Achieve a position of leadership as an
International Stocking Master Distributor and
provider of Steel Processing Services in the
Carbon, Alloy Bar and Tube of Specialty Metals
Markets.
6. Overview of Bar Source International
200 accumulative years in SBQ BARS
and specialty metals
Supplying over 1,500 products to 450
customers with 250-300 monthly
transactions
Foremost distributor of Alloy grade
bars for the Energy Industry
Diversified product portfolio with a
focus on the Oil & Gas markets
Provider of supply chain solutions and
management.
Strong exposure to high-growth end
markets including Oil & Gas, Mining,
Automotive and Heavy Equipment and
Aerospace
Expanding global footprint
7. OUTLINE OF BSI, LLC
MARKETING
STRATEGIES AND
CUSTOMER MARKETS
8. Low cost storage:
• Material stacked on the floor separated by 4 x 4
dunnage
• 2-4 bundles high for timely deliveries with lean
staffing
9. • 4 warehouse bays
• Main bay: 80’ wide x 900’
long
• 3 bays: 60’ wide x 780’
long
• 5 drive-through bays
• 7 overhead cranes
• 1 recessed dock
• Indoor rail served
• 186,000 square foot warehouse
Aurora warehouse footprint
10. Diversified End Markets and Product Offering
End Markets
Focused on high value, non-commodity products
•Automotive
•Agricultural
•Oil & Gas
•Defense
•Hand Tools
•Springs
•Bolts & Nuts
Route to end Markets
•Service Centers
•Forgers
•Investment Casters
•Machine Shops
7
11. Markets Served
Government
Automotive
and Capital Equipment
Markets
Commercial Markets
AEROSPACE
DEFENSE
AIR BAG COMPONENTS
AUTOMOTIVE PARTS
FARM IMPLEMENT AND
EQUIPMENT
FLUID POWER
MACHINING
OIL FIELD EQUIPMENT
RAILROAD EQUIPMENT
PARTS
POWER GENERATION
TRUCK TRAILOR
BOLT Manufacturing
BIOMEDICAL
FORGERS
GEARS
HAND TOOLS
INVESTMENT CASTERS
REMELT
SERVICE CENTERS
SCREW MACHINE
PRODUCTS
SPRINGS
12. High Growth End Markets
Aerospace
2%
Ongoing aircraft
manufacturers provide
long-term revenue
streams
Forging
25%
*Defense/ Ordnance
*Railroad Equipment
*Agriculture
*Off Highway
*Hardware/ Hand
Tools
*Valves & Fittings
Oil & Gas
52%
Global energy demand
continuing to drive
production and drilling
momentum
Strategically positioned to
succeed with growing
global presence including
UK, Canada,
Singapore,Brazil and U.S.
Gulf region
Heavy Equipment &
Infrastructure
18%
Funding for capital
spending expected to
increase as economic
recovery continues
Long-term
relationships with the
leading global OEMs
in this marketplace
BSI provides Unmatched Experience and Expertise in Key End-Markets
13. North American SBQ demand
Application
Demand
2011 2020 Δ(%)
1 - Differential Components 465 640 37.6
2 - CVJ Components 190 265 39.5
3 - Wheel Hubs and Spindles 270 375 38.9
4 - Transmission Components 380 560 47.4
5 - Other Light Vehicle Parts 350 485 38.6
6 - Crankshafts 255 350 37.3
7 - Stabilizer Bars 135 190 40.7
8 - Steering Racks 60 80 33.3
9 - Camshafts 25 40 60.0
10 - Other Shafts 145 200 37.9
11 - Full and Semi-Float Axles 105 145 38.1
12 - Bearings 25 40 60.0
13 - Control Arms 25 40 60.0
14 - Conrods 5 10 100.0
Light Vehicles Total 2,435 3,420 40.5
SBQ Content (kg/vehicle) 186 194 4.3
Application
Demand
2011 2020 Δ(%)
15 - Axles 90 95 5.6
16 - Transmission / Differential 90 95 5.6
17 - Other Heavy Truck Parts 50 55 10.0
18 - Camshafts 20 20 -
19 - Piston Parts 35 40 14.3
20 - Suspension Components 15 15 -
21 - Conrods 20 25 25.0
22 - Crankshafts 55 55 -
Heavy Trucks Total 375 400 6.7
23 - Off-Highway Vehicles 270 395 46.3
24 - Other Industries 900 1,100 22.2
25 - Oil and Gas 500 730 46.0
26 - Defense 50 60 20.0
27 - Mining 500 610 22.0
28 - Wind Power Generation 60 90 50.0
29 - Railroad 225 275 22.2
Industry Total 2,505 3,260 30.1
30 - Service Centers 905 1,300 43.6
31 - Cold Finishers 515 740 43.7
Distribution Total 1,420 2,040 43.7
(1,000 metric t)
LightVehicles
HeavyTrucksIndustryDist.
SBQ Demand: Sectors Breakdown
- Localization and technology changes will increase Light Vehicles SBQ demand by 144,000 t by 2020
14. Overview of Products & Value-Added Services
• 40XX
• 41XX
• 43XX
• 86XX
• 10XX
• 12L15
• Rolled, Forged and as cast forms
• Ingot
• Special Credit Terms: 90 to 120 days
• Trade Financing up to 1 year programs
• Thermal treatment
− Annealing, normalizing, hardening, quenching,
tempering, etc.
• Testing
− Tensile, charpy, Rockwell, OES, Brinell, etc.
• Other services
− Machining, cleaning, bar coding, heat stamping,
straightening, sawing, boring,trepaning.
− Program management, inventory management,
consignment
• Logistics Management
− Ship to anywhere-anytime-same day service
Product Grades Value-Added Services & Solutions
Bar Source International, LLC provides diversified product
offering with focus on Energy Materials
15. 15Oil and Gas: Understanding the Geography
Rotary Rig Activity SBQ Components Manufacturing
+ Alberta, Canada
+ Vera Cruz, Mexico
- Over the last 5 years, the rotary rig count grew significantly in states such as North Dakota and
Pennsylvania due to the exploration of the Bakken oil shale and the Marcellus gas shale respectively.
- The growth in oil and gas production in these states has not impacted the traditional geography for
components manufacturing though. The vast majority of parts and equipment used in this market is still
manufactured by OEMs in Texas, Alberta (Canada), Oklahoma and Vera Cruz (Mexico), and by forgers
located in the Midwest.
Avg. Rig Count
(2010-12)
Location
>200 TX
100 to 200 OK, ND, LA
50 to 100 PA, NM, CO
10 to 50 CA, WY, UT, KS, WV, AR, MT, OH, MS
<10 All other states
Manufacturing Location
OEMs TX, OK, AB (Canada), VZ (Mexico)
Forgers IL, IN, OH, WI, TX, PA
Source: Rig Count History from Baker Hughes Incorporated
16. 2011
SBQ Demand: Sizes Breakdown
SBQ Demand:
6.8 million t
SBQ Demand:
9.1 million t
Rounds
≤ 108 mm
(≤ 4.25”)
59.6%Rounds from
108 to 152 mm
(from 4.25 to
6”)
14.1%
Rounds from
108 to 152
mm
(from 4.25 to
6”)
14.4%
Rounds
≤ 108 mm
(≤ 4.25”)
59.8%
Rounds
> 152 mm
(> 6”)
17.5%
Rounds
> 152 mm
(> 6”)
17.0%
RCS
8.8%
RCS
8.8%
- No significant changes in sizes and shapes are expected for the SBQ market during the analyzed period.
2020
17. -- Develop successful sales strategies used to
capture the customers as “BSI Current
Customers”.
-- Develop on-going repetitive customer focused
strategies to create “New BSI Customers”.
18. Bar Source International
Operational Components- 2013-2016
Analysis of BSI Potential Sales Growth occurred through Complimentary Steel Bar
Processing for Customers
International BSI Expansion throughout Mexico, Canada, Spain, Germany
Singapore, Dubai, Saudi Arabia, etc. through:
Organic Growth of the BSI Sales organization
Mergers/ Acquisitions of other Competitors or Suppliers
19. Bar Source International, LLC
Growth Rollout 2013-2016
Value:
Global supply chain optimization
from known source
Import sourced material heat
treated to our facilities and
shipped direct to manufacturing
and Service Centers locations
All sourcing and logistics
managed transparently, centrally
Consistent Volume buys
leveraged with savings for Bar
Source International
Can be leveraged to grow as
footprint grows
OEM
Mill
Mill
Mill
Distributor
Distributor
BSI
20. The road map
Establish ‘Player’ status in North America through organic
development
Redefine capabilities to include in-house delivery services,
processing and re-position face to market
Domestic – “No Frills” Master Distributor
International – Import buyer of Quality Mills
Establish meaningful operations in other key oilfield
manufacturing centres based on above redefined
capabilities –Canada, Middle East, Singapore, Brazil, Mexico,
Europe, Australia and the United Kingdom
Optimise Supply Chain on global basis and leverage
across Bar Source International, LLC group
11
21. Global Footprint Expansion Strategy
We will be expanding our Global Footprint. In addition, we are looking for a larger
footprint in United Kingdom bringing larger distribution capabilities to the region
Houston
Dubai
Shanghai
Brazil
Lafayette
Dallas
Edmonton
Monterey
Bar Source International, LLC will operate 11 Global Distribution Centers
Australia
Singapore
Blackburn
22. Reasons to use Bar
Source International
• Same day delivery
• Source your requirements worldwide
• Dedicated transportation
• 90-day planned inventory
• Total traceability from melting to manufacturing
• Long term and continuous improvement through
teamwork and cooperation using problem solving
ideas with known data and improvement through
tracking and traceability
• Products consistently manufactured and produced
the same
• Onsite capacity for expansion
23. Competitive Edge
Capabilities vs. our Competition
▫People, Systems Expertise
▫Own logistics staff/ team
▫Niche: we are 100% carbon, alloy
Engineered Bar Products.
▫Stock from 1/4” to 32” diameter
▫Long standing partnerships with KEY SBQ
mill partners in North America
▫Low Cost Metals Distributor
▫Solid financial position/debt free
24. BSI - Differentiators
Why we think that BSI is highly differentiated in our space:
Lead times: Our leading customers, the major distributors that support the OEMs are mainly owned and
operated by public companies that are forcing their operating companies to take inventory turns from a market
healthy 1.8 – 2.3 to a much faster and growth constraining 4+. This places pressure on these OpCos to order less
material more frequently and therefore have less available for sale from their own inventories. We believe that
this will significantly impair their ability to service the market as needed and will create opportunity for BSI.
High Quality Products: Quality in our markets is critical – these are all highly
specialized products that we are supplying to our customers. By developing a
strong technical services group that will constantly monitor customer
specifications and manage the product acquisition process with our mill partners
we will develop a reputation for providing reliable and sustainable product quality.
Superior local service: The commitments our customers need to make to their
customers require product to move quickly through the entire supply chain. By
developing local facilities with best in class systems and by offering superior
logistics solutions we will provide best in class service that will fuel our growth.
Cost Structure Advantage: We believe that as a small and nimble operating unit we are able to
better control costs than our bloated corporate competitors. We also have the advantage of flexibility in our
structure and and select only the best performers to join in the early stages maximizing our efficiencies and
retained earnings potential.
Industry knowledge: Our people will be our most vital differentiator. We will
continue to develop and train our people to understand the applications,
manufacturing processes and supply challenges that our customers face every
day thereby making them a favored source of information and advice that will
pull through product sales. It is not enough to be a trader in our business, we
need to ensure that we are able to provide tailored solutions to each of our
customers unique demands.
The Company
Strictly Private & Confidential
Page 24
BSI will service the
Oil & Gas business,
the Power
Generation,
Petrochemicals,
Aerospace and
Automotive industries
initially in North
America
Reduced lead times,
lower costs, high
quality goods and
superior service
locally will give BSI
an elevated
competitive
advantage against
other slower, bloated
suppliers