EX-99.1 2 d443436dex991.htm INVESTOR PRESENTATION SLIDES

Patterson-UTI Energy, Inc. Patterson-UTI Energy, Inc. Meetings with Investors Meetings with Investors November 2012 November 2012 Exhibit 99.1

2 2 Forward Looking Statements This material and any oral statements made in connection with this material This material and any oral statements made in connection with this material include "forward-looking statements" within the meaning of the Securities Act of include "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Statements made which provide 1933 and the Securities Exchange Act of 1934. Statements made which provide the Company’s or management’s intentions, beliefs, expectations or predictions for the Company’s or management’s intentions, beliefs, expectations or predictions for the future are forward-looking statements and are inherently uncertain. The the future are forward-looking statements and are inherently uncertain. The opinions, forecasts, projections or other statements other than statements of opinions, forecasts, projections or other statements other than statements of historical fact, including, without limitation, plans and objectives of management of historical fact, including, without limitation, plans and objectives of management of the Company are forward-looking statements. It is important to note that actual the Company are forward-looking statements. It is important to note that actual results could differ materially from those discussed in such forward-looking results could differ materially from those discussed in such forward-looking statements. Important factors that could cause actual results to differ materially statements. Important factors that could cause actual results to differ materially include the risk factors and other cautionary statements contained from time to include the risk factors and other cautionary statements contained from time to time in the Company’s SEC filings, which may be obtained by contacting the time in the Company’s SEC filings, which may be obtained by contacting the Company Company or or the the SEC. SEC. These These filings filings are are also also available available through through the the Company’s Company’s web web site site at at http://www.patenergy.com http://www.patenergy.com or or through through the the SEC’s SEC’s Electronic Electronic Data Data Gathering Gathering and and Analysis Analysis Retrieval Retrieval System System (EDGAR) (EDGAR) at at http://www.sec.gov. http://www.sec.gov. We We undertake undertake no no obligation to publicly update or revise any forward-looking statement. Statements obligation to publicly update or revise any forward-looking statement. Statements made in this presentation include non-GAAP financial measures. The required made in this presentation include non-GAAP financial measures. The required reconciliation to GAAP financial measures are included on our website and at the reconciliation to GAAP financial measures are included on our website and at the end of this presentation. end of this presentation.

3 Why Invest in U.S. Oil Services? “The global energy map is changing, with potentially “The global energy map is changing, with potentially far-reaching consequences for energy markets and far-reaching consequences for energy markets and trade. It is being redrawn by the resurgence in oil and trade. It is being redrawn by the resurgence in oil and gas production in the United States…” gas production in the United States…” - - International Energy Agency, “World Energy Outlook 2012” International Energy Agency, “World Energy Outlook 2012” “The recent rebound in US oil and gas production, “The recent rebound in US oil and gas production, driven by upstream technologies that are unlocking driven by upstream technologies that are unlocking light tight oil and shale gas resources…” light tight oil and shale gas resources…” - - International Energy Agency, “World Energy Outlook 2012” International Energy Agency, “World Energy Outlook 2012”

4 Why Invest Now in U.S. Oil Services? • • Shale gas and oil fundamentally changed the North American Shale gas and oil fundamentally changed the North American production outlook for natural gas and oil production outlook for natural gas and oil – – Horizontal drilling and completion techniques Horizontal drilling and completion techniques • • Major new investments over the past five years in North Major new investments over the past five years in North American land projects by many of the largest U.S. and American land projects by many of the largest U.S. and International Oil Companies International Oil Companies – – Major opportunities to produce hydrocarbons at attractive Major opportunities to produce hydrocarbons at attractive world market prices world market prices – – Increased issues in other politically-challenged areas Increased issues in other politically-challenged areas – – Return to North America land; a major shift! Return to North America land; a major shift!

5 Why Invest Now in U.S. Oil Services? • • The timing looks good: The timing looks good: – – Attractive oil prices have kept oil directed activity high Attractive oil prices have kept oil directed activity high •Increased oil activity has largely absorbed the spare •Increased oil activity has largely absorbed the spare capacity from the more than 50% decrease in natural capacity from the more than 50% decrease in natural gas drilling gas drilling – – Natural gas market looks poised for a “modest” Natural gas market looks poised for a “modest” recovery recovery •Storage levels expected to reach record levels, but below •Storage levels expected to reach record levels, but below the previously feared full inventory level the previously feared full inventory level •U.S. natural gas rig count at the lowest level in more than •U.S. natural gas rig count at the lowest level in more than 13 years 13 years •Increased planned industrial usage •Increased planned industrial usage

6 Why Invest in U.S. Oil Services? “By around 2020, the United States is projected “By around 2020, the United States is projected to become the largest global oil producer…” to become the largest global oil producer…” - - International Energy Agency, “World Energy Outlook 2012” International Energy Agency, “World Energy Outlook 2012”

Key Takeaways – PTEN Advantages • • Operational Strength Operational Strength – – High quality equipment High quality equipment – – Term contract backlog / customer relationships Term contract backlog / customer relationships – – Strong operational and financial flexibility Strong operational and financial flexibility • • Flexible operating model Flexible operating model – – Maximizes earnings growth during periods of increased Maximizes earnings growth during periods of increased activity activity – – Minimizes costs during periods of low activity Minimizes costs during periods of low activity – – Strong cash flow generation Strong cash flow generation • • History of returning capital to shareholders History of returning capital to shareholders – – Share buybacks Share buybacks – – Dividends Dividends 7

Contract Drilling • • One of the “Big 3” One of the “Big 3” U.S. Land U.S. Land drillers drillers • • High quality fleet including 107 High quality fleet including 107 APEX™ APEX™ rigs rigs • • Strong term contract coverage Strong term contract coverage Who We Are >> Operational Strength >> Financial Flexibility Patterson-UTI reported results for the nine months ended September 30, 2012 8 Components of Revenue Oil & Natural Gas 2% Pressure Pumping 30% Contract Drilling 68%

Pressure Pumping • • Industry expertise needed for Industry expertise needed for sophisticated customers and sophisticated customers and substantial local knowledge substantial local knowledge • • High quality fleet of modern High quality fleet of modern pressure pumping equipment pressure pumping equipment • • Strong reputation for safe and Strong reputation for safe and efficient operations efficient operations Who We Are >> Operational Strength >> Financial Flexibility Patterson-UTI reported results for the nine months ended September 30, 2012 9 Pressure Pumping 30% Oil & Natural Gas 2% Contract Drilling 68% Components of Revenue

Operational Strength – Operational Strength – Contract Drilling Contract Drilling

11 PTEN’s Active U.S. Land Drilling Rigs PTEN’s Active U.S. Land Drilling Rigs as of November 2012 as of November 2012 East Texas Appalachia & Midwest North Texas Mid-Continent Rockies South Texas 31 Rigs 29 Rigs 23 Rigs 39 Rigs 11 Rigs 13 Rigs Permian Basin 51 Rigs Large Geographic Footprint Who We Are >> Operational Strength >> Financial Flexibility

12 PTEN’s Active Rigs in Unconventional Areas PTEN’s Active Rigs in Unconventional Areas as of November 2012 as of November 2012 Bakken Piceance Haynesville Marcellus Barnett Pinedale 17 Rigs Eagle Ford 2 Rigs 4 Rigs 22 Rigs 7 Rigs 27 Rigs 5 Rigs Utica 6 Rigs Active in Unconventional Plays Who We Are >> Operational Strength >> Financial Flexibility Niobrara 1 Rig Woodford 3 Rigs

13 Innovative Rig Designs Who We Are >> Operational Strength >> Financial Flexibility • 1000 HP drawworks • Small footprint, big rig capability • Fast move & rig-up • Walking system is an optional feature APEX 1000™ • 1500 HP drawworks • Great all purpose rig • Fast move & rig-up • Walking system is an optional feature APEX 1500™ • Able to move in all directions • Able to “walk” with mast up and drill pipe/collars in the derrick • A leadership position in this “fit-for-purpose” rig category APEX Walking™

14 New APEX™ Rigs Have Significantly Increased Fleet Quality. 23 new APEX™ 23 new APEX™ rigs expected to have been added during 2012 rigs expected to have been added during 2012 Increasing Fleet Quality Who We Are >> Operational Strength >> Financial Flexibility 27 114 0 20 40 60 80 100 120 2008 2009 2010 2011 2012E

…and Expected as of June 30, 2013 …and Expected as of June 30, 2013 APEX 1500™ APEX 1000™ APEX Walking™ Total New Rigs Other Electric Rigs Class 15 Preferred Rigs as of September 30, 2012 Preferred Rigs as of September 30, 2012 61 15 50 126 54 6/30/2013 PTEN has approximately 160 of these preferred rigs and expects ~180 preferred rigs by mid-2013 48 13 46 107 54 9/30/2012 Who We Are >> Operational Strength >> Financial Flexibility Increasing Fleet Quality

Who We Are >> Operational Strength >> Financial Flexibility Preferred rigs account for more than Preferred rigs account for more than 75% of Contract Drilling EBITDA 75% of Contract Drilling EBITDA Contribution from High Quality Rigs Contract Drilling EBITDA Contribution by Rig Class Nine Months Ended September 30, 2012 16

• • Mechanical Rigs Mechanical Rigs – – 147 mechanical rigs in fleet 147 mechanical rigs in fleet – – Most Most are are upgraded upgraded to to meet meet customers’ customers’ diverse diverse needs needs – – Ideally suited for certain markets and wells Ideally suited for certain markets and wells – – Favorable return profiles given low book values Favorable return profiles given low book values – – Even better returns if drilling activity accelerates Even better returns if drilling activity accelerates Who We Are >> Operational Strength >> Financial Flexibility Mechanical rigs are a low cost option Mechanical rigs are a low cost option Mechanical Rigs 17 Improved Improved mud mud systems systems Iron Iron roughnecks roughnecks and and other other automation automation Enhanced Enhanced mobility mobility

• • Based on term contracts in place* Based on term contracts in place* – – An average of 132 rigs expected under term contract in the An average of 132 rigs expected under term contract in the fourth quarter fourth quarter – – An average of 79 rigs expected under term contract during An average of 79 rigs expected under term contract during 2013 2013 • • PTEN expects to continue signing term contracts PTEN expects to continue signing term contracts Who We Are >> Operational Strength >> Financial Flexibility Term Contract Coverage Improving earnings visibility and returns stability Improving earnings visibility and returns stability * Term contracts in place as of October 25, 2012 18 • • Drilling Drilling term term contract contract revenue revenue backlog backlog of of $1.3 billion $1.3 billion

19 PTEN’s U.S. Rig Count Remains Firm Who We Are >> Operational Strength >> Financial Flexibility PTEN’s U.S. Rig Count 0 50 100 150 200 250 2009 2010 2011 2012

Operational Strength – Operational Strength – Pressure Pumping Pressure Pumping

21 Recent Investments in Pressure Pumping… …Have Increased Fleet Size and Quality 65 750 * Includes acquisition of approximately 210,000 pressure pumping horsepower in October 2010 Who We Are >> Operational Strength >> Financial Flexibility Growing Pressure Pumping Business 0 200 400 600 800 2006 2007 2008 2009 2010* 2011 2012E Year End Fracturing Horsepower Other Horsepower

Southwest Region: 22 Northeast Region: Fracturing horsepower: 350,000 Other horsepower: 18,000 Frac Crews under contract : 3 Fracturing horsepower: 293,000 Other horsepower: 58,000 Frac Crews under contract: 2 A Significant Player in Regional Markets Approximately 155,000 HP under term contract Who We Are >> Operational Strength >> Financial Flexibility Pressure Pumping Areas of Operation 46% 54% Fracturing Horsepower

23 Average age of only three years Average age of only three years PTEN Fracturing Horsepower by Age Estimated for December 2012 Who We Are >> Operational Strength >> Financial Flexibility Modern Pressure Pumping Fleet >10 Years 6% 5 - 10 Years 21% < 5 Years 73%

Financial Financial Flexibility Flexibility

25 Capital Expenditures and Acquisitions ($ in thousands) Investing in Our Company Who We Are >> Operational Strength >> Financial Flexibility 2006 2007 2008 2009 2010 2011 2012E $598 $637 $445 $453 $976 $1,012 $1,000

26 • • History of returning capital to investors History of returning capital to investors – – Stock Buyback Stock Buyback •Bought approximately 5% of outstanding stock for $109 •Bought approximately 5% of outstanding stock for $109 million through September 30, 2012 million through September 30, 2012 •Approximately $111 million remaining authorization as of •Approximately $111 million remaining authorization as of September 30, 2012 September 30, 2012 •Total of $710 million repurchased since 2005 •Total of $710 million repurchased since 2005 – – Cash Dividend Cash Dividend •Initiated cash dividend in 2004 •Initiated cash dividend in 2004 •Quarterly dividend currently $0.05 per share •Quarterly dividend currently $0.05 per share • • Returned more than $1 billion to shareholders since Returned more than $1 billion to shareholders since 2005 2005 Who We Are >> Operational Strength >> Financial Flexibility Strong Financial Position

• • Total liquidity of approximately $643 million Total liquidity of approximately $643 million – – $83 million of cash at September 30, 2012 $83 million of cash at September 30, 2012 – – $460 million revolver availability at September 30, 2012 $460 million revolver availability at September 30, 2012 – – $100 million term loan to be drawn in December 2012 $100 million term loan to be drawn in December 2012 • • $517 million net debt at September 30, 2012 $517 million net debt at September 30, 2012 – – 16.4% Net Debt/Total Capitalization 16.4% Net Debt/Total Capitalization – – $300 million of 4.97% Series A notes due October 5, 2020 $300 million of 4.97% Series A notes due October 5, 2020 – – $300 million of 4.27% Series B notes due June 14, 2022 $300 million of 4.27% Series B notes due June 14, 2022 • • No equity sales in last 12 years No equity sales in last 12 years • • Reduced share count by 23.1 million shares since Reduced share count by 23.1 million shares since 2005 2005 Who We Are >> Operational Strength >> Financial Flexibility Strong Financial Position 27

Strong Financial Returns 0 500 1,000 1,500 2,000 2,500 3,000 Thousands 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 0 500 1,000 1,500 2,000 2,500 3,000 Thousands 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Growth in Shareholder Equity Growth in Shareholder Equity The Warren Buffett Standard The Warren Buffett Standard 28

Patterson-UTI Energy, Inc. Patterson-UTI Energy, Inc. Meetings with Investors Meetings with Investors November 2012 November 2012

Non-GAAP Financial Measures 30 PATTERSON-UTI ENERGY, INC. Non-GAAP Financial Measures (Unaudited) (dollars in thousands) Three Months Ended September 30, Nine Months Ended September 30, 2012 2011 2012 2011 Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)(1): Net income $ 50,806 $ 81,928 $ 240,618 $ 234,818 Income tax expense 31,354 46,953 140,611 135,985 Net interest expense 7,058 3,788 16,458 11,103 Depreciation, depletion, amortization and impairment 142,393 110,713 393,823 309,677 Results of discontinued operations: Income tax benefit — — — (209) EBITDA $ 231,611 $ 243,382 $ 791,510 $ 691,374 Total revenue $ 643,631 $ 673,828 $ 2,070,664 $ 1,841,296 EBITDA margin 36.0% 36.1% 38.2% 37.5% EBITDA by operating segment: Contract drilling $ 178,987 $ 170,169 $ 570,727 $ 493,960 Pressure pumping 48,633 71,132 183,001 194,686 Oil and natural gas 12,229 9,531 36,323 29,272 Corporate and other (8,238) (7,450) 1,459 (26,544) Consolidated EBITDA $ 231,611 $ 243,382 $ 791,510 $ 691,374 (1) EBITDA is not defined by generally accepted accounting principles (“GAAP”). We present EBITDA (a non-GAAP measure) because we believe it provides additional information with respect to both the performance of our fundamental business activities and our ability to meet our capital expenditures and working capital requirements. EBITDA should not be construed as an alternative to the GAAP measures of net income or operating cash flow.