Enterprise Group Inc. is a consolidator of construction services companies operating in the energy, utility, and transportation infrastructure industries in Western Canada. It operates 4 business units providing utility/infrastructure construction and maintenance, specialized tunnelling services, flameless heat equipment rentals, and heavy equipment rentals. The company pursues an acquisition strategy of complementary private companies to support its continued growth in these industries.
2. FORWARD LOOKING STATEMENTS
Statements in this presentation that are forward-looking statements are subject to
various risks and uncertainties concerning the specific factors disclosed under the heading
“Risk Factors” and elsewhere in the Corporation’s periodic filings with Canadian securities
regulators. Such information contained herein represents management's best judgment
as of the date hereof based on information currently available. The Corporation does not
assume the obligation to update any forward-looking statement.
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3. COMPANY OVERVIEW
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Enterprise Group Inc. (“Enterprise” or “Company” – Ticker – TSX:E) is a consolidator of construction services
companies operating in the energy, utility and transportation infrastructure industries. The Company's focus is
primarily construction services and specialized equipment rental. The Company's strategy is to acquire
complementary service companies in Western Canada, consolidating capital, management and human resources to
support continued growth. Enterprise became a Western Canadian leader in flameless heat technology in September
2012 with its acquisition of Artic Therm International Ltd. and has now become a technological leader in underground
infrastructure construction by the closing of Calgary Tunnelling & Horizontal Augering Ltd. June 14, 2013.
Enterprise currently operates 4 business units:
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TC Backhoe & Directional Drilling (service provider to mid-stream and infrastructure/utility companies),
Calgary Tunnelling & Horizontal Augering Ltd (highly specialized tunnelling for pipeline, utility and infrastructure)
Artic Therm International (specialized equipment rental provider) and
E-One Limited (construction class heavy equipment rental provider).
The Company was incorporated on 2004 and is headquartered in St. Albert, Alberta.
Enterprise currently employs between 125 - 200 employees depending on the season, and has a world class customer
base.
Enterprise's typical customers are:
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Integrated O&G
Multinational Mid-Stream
Cross Country pipeline Constructors
Telecommunications
Cable Television
Electricity and Natural Gas Services
North American Rail Companies
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4. ACQUISITION STRATEGY
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Acquire complementary businesses at accretive valuations
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Ideal Targets:
– Unique Western Canada focused private companies with limited access to capital for
growth
– Businesses that service the energy, utility and transportation infrastructure industries
– Successful track record with high quality, top tier clients
– Profitable
– Possess the market ability to double within 2 – 3 years
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Typical Acquisition Structure
– Purchase price of < 3.0x EBITDA
– Acquisition price paid with a combination of cash, equity, debt & VTB
– Key personnel retained via 5 year employment contracts and incentives
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Enterprise Group will leverage its expertise, strong client relationships and access to capital to
accelerate organic growth
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5. DEBT REFINANCING
SEPTEMBER 2O12 - Enterprise completes a refinancing with PNC
Canada Branch. Implementing a $12.5 million operating line at
prime + 2% for a three year term.
MAY 2O13 – Operating line increases to $20 million
PNC is currently the seventh largest bank by deposits in the United
States, as well as the sixth largest by total assets, fifth in total
branches, and is the third largest bank off-premise ATM provider.
PNC is based in Pittsburgh, USA.
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6. SEGMENTS OVERVIEW
Enterprise Group’s four business units deliver utility & infrastructure
construction services, and heavy equipment & flameless heating rentals
UTILITY/INFRASTRUCTURE
CONST. & MAINT.
North American leader in
the highly specialized
tunnelling field. CTHA
utilizes a number of
tunnelling disciplines laser
guided boring & augering,
pipe ramming, pipe
jacking/tunnel boring
(TBM), among others.
Serving the premier
utility providers in
Alberta installing
and maintaining
utility services both
underground and
above ground.
EQUIPMENT RENTAL
Renting the most
advanced flameless
heaters ranging
in heat output
from 500,000 to
3,000,000 BTU’s.
Pioneers of pipeline
thermal expansion
A first call for heavy
equipment rentals in the
oilfield & civil construction
sectors and operating
project crews constructing
pipelines & facilities for
the prolific oil & gas fields
of Western Canadian
Sedimentary Basin.
The company has a growing equipment asset base of nearly $30 million including
a fleet of over 300 trucks, heavy equipment and specialized heating units.
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7. Calgary Tunnelling & Horizontal Augering Ltd.
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Founded in 1984, Calgary Tunnelling
& Horizontal Augering Ltd., ("CTHA")
is a North American leader in the
highly specialized tunnelling field.
CTHA utilizes a number of tunnelling
disciplines to get the job done
efficiently and safely such as laser
guided boring & augering, pipe
ramming, pipe jacking/tunnel boring
(TBM), among others.
CTHA performs its services from the
west coast through to central Canada
across the energy, utility and
infrastructure segments. Its clients
range from Canada's largest rail
companies and premier utility
providers to leading infrastructure
contractors and some of North
America's largest pipeline companies.
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8. Calgary Tunnelling
Acquisition Highlights
• Highly successful specialized underground infrastructure construction company with operations
based in Alberta deploying its services from the West Coast to Central Canada.
• ~30 years as an operating company and +60 years of cumulative field experience
• Provides multiple services to top tier clients
• Accretive acquisition that is complementary to Enterprise Group’s existing businesses
• For the year ended 2012, the private company generated $14.9 million of revenue and $5.85 million
of EBITDA
• Acquisition price is $12 million (just over 2 X EBITDA)
- Acquisition being funded by debt, cash and a $1.0 million vendor take-back financing to be repaid over two
years
- Acquisition completed June 14, 2013
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9. TC Backhoe – Utility/ Infrastructure
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Industry leader in utility and pipeline
construction working throughout Alberta
with over 35 years of industry experience
Focused on the installation and repair of
underground utility services in subdivisions
Relationships with Alberta’s largest
developers including Qualico, Genstar and
Landrex
Customers include Canada’s largest
telecommunications, cable TV, electricity &
natural gas service providers.
Services provided by TC Backhoe include
directional drilling, hydrovacing, trenching
and plowing, backhoe and dozer work, as well
as complete site clean-up
Excellent revenue visibility as ~40% of
revenues from long term contracts (12-18
mos.)
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10. Artic Therm – Flameless Heat Rental
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Founded in 1997 and acquired by
Enterprise Group in September 2012
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Acquisition price of $6.5 mil (2.4x trailing
EBITDA )
Provides efficient Flameless Heat and
Green Air technology for multiple
applications using portable equipment
to remote locations for the extreme
climate challenges
Proprietary technology
Fleet of over 100 units with substantial
opportunity for expansion due to
increasing demand
500,000 to 3.3 Million BTU output
Blower technology of up to 15,000
CFM at Peak
Applications
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Pipeline Thermal Expansion
De-Humidifying
Confined Space Entry
Plant & Facility Shut Downs
Vessel Coating Curing
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11. ARTIC THERM
FLAMELESS HEATING
Pioneers in Flameless Heating Technology
500,000 to 3.3 Million BTU Output
Blower Technology of up to 15,000 CFM at Peak
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13. E One Limited – Heavy Equipment Rental
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Located in Central and North Central
Alberta
Strategically located to serve the needs
of the demanding construction and
energy services industries
40 pieces of heavy construction
equipment including excavators,
bulldozers and pipe-layers typically rent
out at $5,500 to $19,500 per month
E-One provides:
– Late model equipment
– Professionally serviced and maintained
fleet – less downtime, and more work time
– Best-in-Class brands and models
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Historical utilization rate of 60-95%
capacity
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15. LEADERSHIP TEAM
Leonard D. Jaroszuk – President, CEO, Chairman
Entrepreneur with 27+ years experience managing public companies engaged in real estate,
construction, natural resources and exploration. Serves as a Director on several oil & gas service
and manufacturing companies
Desmond O’Kell – Vice President, Director and Corporate Secretary
Has been with Enterprise Group since its inception. 26+ years experience in corporate
development, finance and business operations.
Doug Bachman – COO
25+ years experience in corporate finance and management from a tier-one Canadian chartered
bank
Warren Cabral – CFO
Recently served as CFO for AIMCo managing global investments for pensions, endowments and
government funds in Alberta. Joined Enterprise group in January 2013
John Pinsent – Director
Manu K. Sekhri– Director
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16. Financial Summary
Capitalization Table
Shares Outstanding (Sept 2013)
Basic
Options
Warrants
Fully Diluted
52-Week High-Low
Market Capitalization
Enterprise Value
Shareholders Summary
In Millions
84.5
~ 4.7
~ 1.2
90.4
$0.89-$0.20
69.3
89.3
Major Shareholders
Management / Directors / Assoc’s
30.00% +
Float and Public
~66.40%
Total
100.00%
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