Oilfield Services: Another Great Year Ahead

What you need to know: • We expect oilfield service stocks to continue to outperform in 2023 and beyond based on supportive oil price fundamentals, rising capex levels amongst E&Ps, and pricing power leading to margin expansion • Despite the sector’s strong fundamental tailwinds and the probability for a multi-year commodity supercycle, oilfield service companies are still trading at trough-level multiples Investment Thesis Supportive Oil Prices While we will not go in-depth on oil price funda

Positive Trends for Canadian Pressure Pumping

WCSB pressure pumping supply and demand is poised to benefit from an increase in stages per well and proppant per well. We believe this could cause supply and demand to tighten more quickly than anticipated in an activity recovery. Higher service intensity has been particularly evident in the Montney and Duvernay, where stages per well have generated a 2012-1Q16 CAGR of 23% and 44%, respectively, and a proppant per well CAGR of 39% and 62%. Our investment bias is towards Trican given it is the l

Announces Transactions to Improve Balance Sheet

Trican announced an equity issuance on June 1st totaling $69 mm (including the over-allotment), which resulted in the issuance of ~43.1 mm shares, or 28% of the outstanding share count as at March 31, 2016. The offering price was $1.60/share or an 8.6% discount to the halt price on June 1st. The Company concurrently announced the sale of its Completion Tools business to National Oilwell Varco Ltd. (NOV-N, not covered). The sale price was $53.5 mm, which was comprised of $30 mm cash and C$23.5 m

1Q16 Update

Trican reported negative adjusted 1Q16 EBITDAS of $16 mm and EBITDAS of negative $26 mm. Comparisons to our estimates are not meaningful given the discontinuation of U.S. operations in the quarter. Canadian operating margins of negative 8.6% were much lower than our expectation of negative 1.4%. We believe this is important when considering the turnaround in profitability needed in 3Q16e for Trican to remain in compliance with its covenants. The risk of the Company having to use its equity cure

1Q16 RESULTS MARRED BY ONE-TIME EVENTS

Trican's results were marred by one-time costs related to severance and professional fees ($10.6 mm) as well as the U.S. pressure pumping business being moved to discontinued operations. We believe the most important data for investors is the performance of the Canadian operations as that is what Trican will largely consist of moving forward. Consolidated results can be found at the end of this document. We believe the primary focus on the conference call tomorrow will be on the Company's abilit

TRICAN WELL SERVICE LTD. ANNOUNCES RETIREMENT OF PRESIDENT AND COO

Trican has announced that Mr. Don Luft, President and COO will be retiring from his role effective May 3, 2016. Additionally, Mr. Luft will not stand for reelection as a Director of the Company at the upcoming AGM. Recall, Mr. Luft was one of the early instrumental players in transforming Trican from a private entity into a successful public company in 1996, and in the success and growth of the company since that time.

1Q16e Preview and Commodity Update – All Is Quiet on the Western Front

We are updating our oilfield industry forecasts post the release of FirstEnergy’s new commodity price forecast for crude oil and natural gas on March 24, 2016. We have updated our 2016e Canadian well count/drilling days forecast to 3,209/37,335 from 3,800/43,325. In 2017e, we have left our forecast unchanged at 6,200 wells/70,200 days. In the U.S., our 2016e rig count forecast is now 482 (prior: 610) and 2017e is 675 (prior: 775). Data for 1Q16e came in weaker than our prior forecast anticipated

U.S. PRESSURE PUMPING SALE DATE OF CLOSING PASSES WITH NO FORMAL CLOSING ANNOUNCEMENT

Until we learn otherwise, we still expect Trican to close the sale of its U.S. business to Keane. However, the expected closing date for this transaction of March 15, 2016 or earlier has passed, yet there has been no formal announcement that the sale has been completed.

4Q15: Doing What Is Necessary

The outlook for Canadian profitability has deteriorated materially from our prior forecast due to continued price discounting in 1Q16e. We have lowered our 2016e EBITDAS to $5 mm from $20 mm and 2017e EBITDAS to $50 mm from $64 mm. Our 2016e exit net debt forecast has increased to $249 mm from $140 mm, as we had been far too aggressive in modelling working capital draws throughout 2016e. The risk of the Company having to use its equity cure provision has increased materially due to potential cov

REPORTS 4Q15 RESULTS

Impact: negative due to weaker than expected Canadian operating income margins in 4Q15 and a weaker than anticipated Canadian outlook.

Energy Services 4Q15e Preview and Updating Activity Outlook – Buckle Up

In conjunction with the new oil price forecast released by FirstEnergy on February 8, 2016, we have updated our 2016e Canadian well count/drilling days forecast to 3,800/43,325 from 4,950/54,853. In 2017e, we are now forecasting wells/drilling days of 6,200/70,200 from 7,900/86,600. In the U.S., our 2016e rig count forecast is now 610 (prior: 763) and 2017e is 775 (prior: 1,063).

Trican Well Service Ltd. (TCW) Upgrading to Outperform after Formal Announcement of Sale of U.S. Business and Amended Covenants with Lenders

Trican has announced the sale of its U.S. Pressure Pumping business for US$200 mm (C$285 mm) plus a 10% equity investment, to Keane Group, a privately held U.S. Services company, and concurrently announced newly amended covenant relief with lenders. Total estimated transaction value is $352 to $405 mm. We estimate the EV/Replacement value metric at 32% after adjustments for working capital and EV/HP at $474. Both of these are respectable metrics. We are increasing our 12-month target price to $2

NEW LARGE SHAREHOLDER WITH SIGNIFICANT EXPERIENCE IN THE FRACTURING BUSINESS

Impact: We expect the stock to trade higher on the news that there is a new large investor in Trican that has a prior history in pressure pumping.

TRICAN WELL SERVICE LTD. (TCW) IN NEGOTIATIONS TO SELL U.S. PRESSURE PUMPING BUSINESS

Impact: neutral as there is no guarantee of a transaction being completed. Trican has announced that it is in negotiations for the sale of its U.S. pressure pumping business to Keane Group., a privately-held, U.S. based well completion company. Trican's management believes the price being offered represents fair value and that it would be in the best interest of shareholders, but significant terms and conditions are still under negotiation. No other details were released.

Introducing 2017 Estimates

We have updated our 2016e WCSB drilling days forecast to ~54,900 days, which is 18% below our prior forecast and a 16% decline y/y. We are also rolling out our 2017e drilling days forecast, which is 86,600 days, or a 58% improvement from 2016e. In the context of the last 25 years, our 2017e forecast ranks 19th for active drilling days. Our 2016e U.S. rig count forecast has been reduced to 763 rigs from 888 rigs. In 2017e, we are forecasting a U.S. rig count of 1,063 rigs.

Invinity Energy Systems - New Sale Could Build Familiarity

A sale of four VS3 Invinity flow batteries shows continued positive momentum for the company. This deal goes further as we see it building familiarity for the company’s storage technology with key members of the workforce in the North American electricity industry.

LIBERUM: Yü Group* - Yet more upgrades

Initial Equity Trading Comments - 15 May 2023

LIBERUM: Eneraqua Technologies* - Initiation - Saving money... and the planet

RSL budget pressures impact margin expectations

FY23 results confirm strong growth, delivering adj. PBT of £10.1m (SCMe: £9.8m, FY22: £5.6m). Investors are likely to focus on the outlook however, where we materially reduce our earnings forecasts. Registered social landlord clients are reacting to significant budget pressures, with high levels of cost inflation exceeding government rent caps. In response, clients have rephased project schedules, prioritising lower cost per unit, typically lower margin, projects as they right-size capital budge

Morning Note – 11 May 2023

Mpac Group+ (MPAC, House Stock, 230p) - AGM update; FY23F unchanged

Hybridan Research: Sector Review: Critical minerals for UK - mining and battery recycling: 09-05-2023

Virgin mining: Energy security and decarbonisation are driving the race in the sourcing of critical minerals from the natural world. This has contributed to the revival of exploration activities in the US, Europe and to a lesser degree the UK. For example, the global identified lithium resources increased from 40m tonnes in 2015 (the Paris Agreement year) to 97m tonnes in 2023, at a CAGR of 12%, according to the U.S. Geological Survey data. For example, there was no identified lithium resources

LIBERUM: Wincanton - FY results in line, exit from closed book transport

Hybridan Small Cap Feast - 23 Feb 23

23rd May 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objectiv

LIBERUM: ATOME Energy * - Significant expansion of Villeta, BH joins the register

Webinar: “The Impact of US IRA on Clean Energy Companies”

The US Inflation Reduction Act will have sweeping impacts on the energy industry and its participants. We’ve invited four companies from the Active Net Zero Universe to share how they see the industry evolving, helping investors identify the major risks and opportunities. Companies presenting are EQTEC (EQT LN), Foresight Group (FSG LN), Invinity Energy Systems (IES LN) and Velocys (VLS LN). The Active Net Zero Universe uses the same selection methodology as the Solactive Active Net Zero Global

Powerhouse Energy - Northern Ireland Site Identified

Powerhouse has today announced an agreement with Noage Energy to establish a project in Northern Ireland using Powerhouse technology to convert waste to energy. Noage have identified a potential site and work is due to commence to negotiate access and to obtain the necessary permits for construction and operations. This follows the joint venture with Hydrogen Utopia International to develop a waste to hydrogen project in the Republic of Ireland announced earlier this year and displays a growing

Epwin Group+ (EPWN, House Stock, 67p) - Trading update: forecasts intact; 7x PER compelling

In the Flow

Industry flows - bond funds remain preferred over equities Risk appetite for equity funds remained subdued with last week seeing $4bn net outflows (negative in 8 of the last 9 weeks). Flows worsened sequentially for Asia/EM categories, but improved for US and European equities. Bond funds saw inflows for a 10th straight week (c.$8bn) with broad based inflows across US government, IG and HY funds. Listed asset managers flows - inflows into ETFs, outflows from mutual funds ETFs net inflows contin