2. This presentation contains certain statements that may be deemed "forward-looking statements". All
statements in this document, other than statements of historical fact, that address events or
developments that Lonestar West Inc. (“the Company”) expects to occur, are forward looking
statements. Forward looking statements are statements that are not historical facts and are generally, but
not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates",
"projects", "potential" and similar expressions, or that events or conditions "will", "would", "may", "could"
or "should" occur.
Although the Company believes the expectations expressed in such forward-looking statements are
based on reasonable assumptions, such statements are not guarantees of future performance and actual
results may differ materially from those in the forward- looking statements. Factors that could cause the
actual results to differ materially from those in forward looking statements include, failure to
successfully negotiate or subsequently close such transactions, inability to obtain required shareholder
or regulatory approvals, uncertainty with respect to findings under exploration programs and general
economic, market or business conditions. Investors are cautioned that any such statements are not
guarantees of future performance and actual results or developments may differ materially from those
projected in the forward-looking statements. Forward looking statements are based on the beliefs,
estimates and opinions of the Company's management on the date the statements are made. The
Company undertakes no obligation to update these forward-looking statements in the event that
management's beliefs, estimates or opinions, or other factors, should change.
Forward-Looking Statements
Page 2
3. Lonestar Service Area
HEAD OFFICE:
Sylvan Lake, Alberta
CANADA:
Fort McMurray, Alberta
Bonnyville, Alberta
Edmonton, Alberta
Whitecourt, Alberta
Carlyle, Saskatchewan
Moose Jaw, Saskatchewan
Melita, Manitoba
Toronto, Ontario
U.S.A.:
Sacramento, California
Witchita, Kansas
Lake Charles, Louisiana
Calcutta, Ohio
Elk City, Oklahoma
Tulsa, Oklahoma
Williamsport, Pennsylvania
Nashville, Tennessee
Beaumont, Texas
Dallas, Texas
Odessa, Texas
San Antonio, Texas
Page 3
Sacramento
San Antonio
Dallas
Odessa
Elk City
Witchita
Nashville
California
Texas
Kansas
Tennessee
Oklahoma
Fort McMurray
Bonnyville
Edmonton
Sylvan Lake
Whitecourt
Carlyle
Moose Jaw
Melita
Alberta
Saskatchewan
Manitoba
Ontario
Toronto
Tulsa
Louisiana
Pennsylvania
Ohio
Calcutta
Lake Charles
Williamsport
4. What Is Hydro-Excavation?
The process of excavating rock and soil
to expose underground utilities and
pipelines.
Uses pressurized water to agitate the
earth, and a powerful vacuum to remove
the soil and debris.
Non-destructive method of excavating
which replaces a conventional backhoe
and manual digging.
Page 4
5. Benefits Of HVAC Excavation?
Safer and faster than traditional
excavation methods when operating
around sensitive infrastructure.
Can excavate frozen ground because of
onboard water heaters.
Reduces environmental liability and
potential restoration costs.
Page 5
6. HVAC Truck
A new HVAC truck
costs $475,000.
Lonestar currently
operates 89 HVAC trucks;
with 38 in the U.S.
6
Page 6
7. HVAC Applications
Oil & Gas Industry
• Tank cleaning
• Pipeline trenching
• Facility maintenance
Utility Sector
• Piling & pole hole excavation
Communication Companies
• Uncovering buried utilities
Environmental Cleanup
• Debris removal & cleanouts
Construction Industry
• Shoring & slot trenching
Page 7
8. HVAC Competitors
• 80 HVAC trucks (estimated)
• 80 HVAC trucks (estimated)
• Over 60 smaller HVAC trucks
• North America’s largest
provider of non-destructive
daylighting services
• 405 HVAC trucks
in Canada
• 552 HVAC trucks
in the U.S.
Page 8
9. Vacuum “VAC” Truck
A new VAC truck costs
~$400,000.
Lonestar currently
operates 27 VAC trucks;
with 12 in the U.S.
Broad based
competition.
Page 9
10. VAC Applications
• Fuel tank cleaning
• Spill cleanup
• Car wash
• Flood damage
• Septic tanks
• Sewers
Well Sites
• Remove drilling fluids
• Disposing of fluids in either spread
fields or authorized disposal facilities
Industrial
• Fuel tank cleaning
• Spill cleanup
• Car wash
Pipeline
• Non-destructive testing
Other
• Flood damage
• Septic Tanks
• Sewers
Page 10
11. Safety Record
• Strong Health, Safety & Environmental
Program (HSE).
• AASP approved Certificate of Recognition
(COR).
• Prequalified by ISNetworld, Complyworks,
Canqual & PIC’s Auditing as a low-risk
supplier.
• Continuously evolving HSE program to
stay ahead of changes in the industry.
• GPS monitoring enhances safety.
• Low lost-time incident frequency.
Page 11
12. Lonestar Advantage
• Increased efficiency, saving time and money
Superior Trucks
• Qualified for major corporate accounts
Superior Safety Record
• Trained to be safe and efficient
Top Crews
• Over 100 years combined management experience
Experienced Managers
• Founding management
Operating 13+ Years
Page 12
13. Capital Structure
Issued:
• Insiders: 8.3 m
• CEO (insider) 7.3 m
• Public float 20.9 m
Total Issued: 29.2 m
• Unexercised options: 574,909
Fully Diluted: 29.7 m
Financings:
• June/14 $20.0m @ $3.30
• July/13 $10.1m @ $2.60
• Nov/12 $3.04m @ $1.40
• Aug/11 $1.2m @ $0.60
• Dec/08 $1.2m IPO @ $0.50
Page 13
14. U.S. Expansion
• U.S. growth – Continually adding to U.S. fleet.
• California (4)
• Texas (23)
• Kansas (5)
• Tennessee (7)
• Pennsylvania (3)
• Louisiana (1)
• California (infrastructure)
• OK, TX & KS (oil & gas)
• Key management hires
• Growing revenue per truck
• California has fewer Hydrovac trucks than are located in Edmonton!
Page 14
15. What We Have Accomplished
Fleet Growth
• 139 – Jan. 2015
• 65 – Oct. 2013
Platform Growth
• 18 Bases – Jan. 2015
• 9 Bases - Oct. 2013
• U.S. operations gaining traction.
• Bought Deal Financing at a premium to recent trading for $20 m.
• Recent close of Vamp acquisition.
Page 15
17. In One Year
Trucks
14,989
21,074
314 703
1,765
2,933
0
25
50
75
100
125
-500
4,500
9,500
14,500
19,500
First Half 2013 First Half 2014
Revenue
Net Earnings (loss)
EBITDAC
Trucks
53
122
$ Thousand
Page 17
18. In One Year
$ Thousand
6,212
9,555
-448 -132
209
808
0
25
50
75
100
125
-500
1,000
2,500
4,000
5,500
7,000
8,500
10,000
Q4F13 Q2 14
Revenue
Net Earnings (loss)
EBITDAC
Trucks
53
122
Trucks
Page 18
19. Leadership Team
Officers
James Horvath – President & Chief Executive Officer
David Prussky - Chairman
Kristin York – Vice President
Kristina Scade – Chief Financial Officer
Directors
James Horvath – President & Chief Executive Officer
Tracy Graf – CEO, Carfinco Financial Group Inc.
Joe MacLean – President and CEO, AOI Capital, LLC
Maurice Kagan – CEO, Danika Associates Limited
David Prussky – Director, Patica Securities Limited
Senior Managers
13 senior HVAC and Vacuum managers
(includes U.S. Business Development, U.S. Operations Manager and all Base Managers)
Page 19
20. Key Investment Highlights
Large and growing
client base
Diversified
U.S. Expansion
Quickly becoming
a noted competitor
in the Canadian
HVAC industry
Energy,
infrastructure &
mining
Oklahoma
Texas (energy)
California (utilities &
infrastructure)
Page 20
21. Key Investment Highlights
Strong projected growth.
Superior safety record.
Highly experienced management
with field experience.
28% inside ownership.
Page 21
23. Thank-You
Lonestar West Inc.
TSX Venture Exchange: LSI
January 2015
For further information, please contact:
Lonestar West Inc.
lonestarwest.com
403-887-2074
Investor Relations
The Howard Group
Jeff Walker/Ariel Cobangbang
403-221-0915
Page 23
