EX-99.1 2 d493264dex991.htm EX-99.1

Patterson-UTI Energy, Inc. Patterson-UTI Energy, Inc. March 5-6, 2013 March 5-6, 2013 Exhibit 99.1 Raymond James 34 Annual Institutional Investors Conference th

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 or the SEC. These filings are also available through the Company or the SEC. These filings are also available through the Company’s web Company’s web site at http://www.patenergy.com site at http://www.patenergy.com or through the SEC’s Electronic Data Gathering or through the SEC’s Electronic Data Gathering and Analysis Retrieval System (EDGAR) at http://www.sec.gov. We undertake no and Analysis Retrieval System (EDGAR) at http://www.sec.gov. We undertake 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? “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”

4 Why Invest 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 Source: US Energy Information Administration, Short-Term Energy Outlook, February 12, 2013

5 Why Invest in U.S. Oil Services? • • The timing looks good: The timing looks good: – – The rig count looks poised for a modest recovery The rig count looks poised for a modest recovery – – Pressure pumping outlook has improved Pressure pumping outlook has improved

Why Invest in Patterson-UTI Energy? • • Operational Strength Operational Strength – – High quality equipment High quality equipment – – Customer relationships Customer relationships – – Operational flexibility Operational flexibility • • Flexible operating model Flexible operating model – – Maximizes earnings growth during Maximizes earnings growth during periods of increased activity periods of increased activity – – Minimizes costs during periods of Minimizes costs during periods of low activity low activity – – Strong cash flow generation Strong cash flow generation • • History of returning capital to History of returning capital to shareholders shareholders – – Share buybacks Share buybacks – – Dividends Dividends 6

Who We Are Who We Are

Contract Drilling • • One of the “Big 3” One of the “Big 3” U.S. Land U.S. Land drillers drillers • • High quality fleet including 113 High quality fleet including 113 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 twelve months ended December 31, 2012 8

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 twelve months ended December 31, 2012 9

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 March 2013 as of March 2013 East Texas East Texas Appalachia & Midwest Appalachia & Midwest North Texas North Texas Rockies Rockies South Texas South Texas 33 Rigs 29 Rigs 24 Rigs 39 Rigs 6 Rigs 13 Rigs Permian Basin Permian Basin 48 Rigs Large Geographic Footprint

12 Innovative Rig Designs Who We Are >> Operational Strength >> Financial Flexibility

Introducing the APEX-XK ™ • • Enhanced mobility including Enhanced mobility including more efficient rig up and rig more efficient rig up and rig down down • • Greater clearance under rig Greater clearance under rig floor for optional walking floor for optional walking system system • • Advanced environmental spill Advanced environmental spill control integrated into drilling control integrated into drilling floor floor • • Enhanced solids handling Enhanced solids handling • • Available in both Available in both 1500 horsepower and 1500 horsepower and 1000 horsepower 1000 horsepower Who We Are >> Operational Strength >> Financial Flexibility 13 http://patenergy.com/drilling/technology

Enhancing our Position in Pad Drilling Who We Are >> Operational Strength >> Financial Flexibility 14 Walking Systems Can be Added to Any Rig in Our Fleet… Walking Systems Can be Added to Any Rig in Our Fleet… …Allowing for True Multi-Directional Pad Drilling Capabilities …Allowing for True Multi-Directional Pad Drilling Capabilities

Enhancing our Position in Pad Drilling Who We Are >> Operational Strength >> Financial Flexibility 15 Adding Walking Systems to APEX Adding Walking Systems to APEX ® ® Rigs Allows: Rigs Allows: • A rig to both walk on a pad while still mobilizing quickly between pads • Greater flexibility in location of the wells on a pad • Reduces well construction time and cost in pad drilling

APEX WALKING ® Rigs • • Optimized for more than four Optimized for more than four wells on a pad wells on a pad • • Capable of walking with drill Capable of walking with drill pipe and collars racked in pipe and collars racked in derrick derrick • • Full multi-directional walking Full multi-directional walking capability capability • • Walking times average 45 Walking times average 45 minutes for 10’ minutes for 10’ – – 15’ 15’ well well spacing spacing Who We Are >> Operational Strength >> Financial Flexibility 16 http://patenergy.com/drilling/technology

APEX WALKING ® Rigs Who We Are >> Operational Strength >> Financial Flexibility 17 http://patenergy.com/drilling/technology Video of APEX WALKING ® Rig

…and Expected as of December 31, 2013 …and Expected as of December 31, 2013 APEX-XK 1500™ APEX-XK 1500™ APEX-XK 1000™ APEX-XK 1000™ APEX WALKING APEX WALKING ® ® APEX 1500 APEX 1500 ® ® APEX 1000 APEX 1000 ® ® Total APEX Total APEX ® ® Rigs Rigs Class Class 18 APEX APEX ® ® Rigs as of December 31, 2012 Rigs as of December 31, 2012 19 19 4 4 48 48 44 44 11 11 126 126 12/31/2013 12/31/2013 A leader in high specification drilling rigs 7 7 4 4 47 47 44 44 11 11 113 113 12/31/2012 12/31/2012 Who We Are >> Operational Strength >> Financial Flexibility APEX ® Rig Fleet

19 Who We Are >> Operational Strength >> Financial Flexibility Continued Demand for APEX ® Rigs Percentage of Horizontal Wells Continues to Increase Percentage of Horizontal Wells Continues to Increase

Operational Strength – Operational Strength – Pressure Pumping Pressure Pumping

Focused on Well Site Execution • • Diversified provider of pressure Diversified provider of pressure pumping services including pumping services including hydraulic fracturing, cementing, hydraulic fracturing, cementing, nitrogen services, and acidizing nitrogen services, and acidizing • • Modern equipment enhances Modern equipment enhances reliability reliability • • Preventive maintenance Preventive maintenance program reduces downtime program reduces downtime • • Premium service supports Premium service supports premium pricing premium pricing Who We Are >> Operational Strength >> Financial Flexibility 21 http://patenergy.com/pressurepumping

22 Average age of only three years Average age of only three years PTEN Fracturing Horsepower by Age As of December 31, 2012 Who We Are >> Operational Strength >> Financial Flexibility Modern Pressure Pumping Fleet

Dual Fuel Conversions • • Engines can burn a fuel mix Engines can burn a fuel mix comprised of up to 70% comprised of up to 70% natural gas natural gas • • Comparable torque and Comparable torque and horsepower as an all diesel horsepower as an all diesel engine engine • • Reduces operating costs by Reduces operating costs by lowering fuel costs lowering fuel costs • • Good for environmental Good for environmental sustainability sustainability Who We Are >> Operational Strength >> Financial Flexibility 23

Financial Financial Flexibility Flexibility

25 Capital Expenditures and Acquisitions ($ in millions) Investing in Our Company Who We Are >> Operational Strength >> Financial Flexibility

26 • • History of returning capital to investors History of returning capital to investors – – Stock Buyback Stock Buyback •Repurchased 7% of Shares in 2012 •Repurchased 7% of Shares in 2012 •Approximately $51 million remaining authorization as of •Approximately $51 million remaining authorization as of December 31, 2012 December 31, 2012 •Total of $770 million repurchased since 2005 •Total of $770 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 approximately $1.1 billion to shareholders Returned approximately $1.1 billion to shareholders since 2005 since 2005 Who We Are >> Operational Strength >> Financial Flexibility Strong Financial Position

• • Total liquidity of approximately $571 million Total liquidity of approximately $571 million – – $111 million of cash at December 31, 2012 $111 million of cash at December 31, 2012 – – $460 million revolver availability at December 31, 2012 $460 million revolver availability at December 31, 2012 • • $588 million net debt at December 31, 2012 $588 million net debt at December 31, 2012 – – 18% Net Debt/Total Capitalization 18% 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 – – $99 million of 5-year term loan $99 million of 5-year term loan • • No equity sales in last 12 years No equity sales in last 12 years • • Reduced share count by 26.5 million shares since Reduced share count by 26.5 million shares since 2005 2005 Who We Are >> Operational Strength >> Financial Flexibility Strong Financial Position 27

Strong Financial Returns Growth in Per-Share Book Value Growth in Per-Share Book Value The Warren Buffett Standard The Warren Buffett Standard 28

Patterson-UTI Energy, Inc. Patterson-UTI Energy, Inc. Raymond James 34 Annual Institutional Investors Conference March 5-6, 2013 March 5-6, 2013 th

Additional References Additional References

31 PTEN’s Active Rigs in Unconventional Areas PTEN’s Active Rigs in Unconventional Areas as of March 2013 as of March 2013 Piceance Piceance Haynesville Haynesville Marcellus Marcellus Barnett Barnett 19 Rigs Eagle Ford Eagle Ford 5 Rigs 21 Rigs 4 Rigs 28 Rigs 6 Rigs 8 Rigs Active in Unconventional Plays Niobrara Niobrara 1 Rig Woodford Woodford 3 Rigs

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 Twelve Months Ended December 31, 2012 32

• Mechanical Rigs – 147 mechanical rigs in fleet – Most are upgraded to meet customers’ diverse needs – Ideally suited for certain markets and wells – Favorable return profiles given low book values – Even better returns if drilling activity accelerates Mechanical rigs are an option on higher drilling activity Mechanical rigs are an option on higher drilling activity Mechanical Rigs 33 • Improved mud systems • Iron roughnecks and other automation • Enhanced mobility

• • Based on term contracts in place* Based on term contracts in place* – – An average of 123 rigs expected under term contract in the An average of 123 rigs expected under term contract in the first quarter of 2013 first quarter of 2013 – – An average of 97 rigs expected under term contract for all of An average of 97 rigs expected under term contract for all of 2013 2013 • • PTEN expects to continue signing term contracts PTEN expects to continue signing term contracts Term Contract Coverage Improving earnings visibility and returns stability Improving earnings visibility and returns stability * Term contracts in place as of February 7, 2013 34 • • Drilling Drilling term term contract contract revenue revenue backlog backlog of of $1.24 $1.24 billion billion at December 31, 2012 at December 31, 2012

35 Recent Investments in Pressure Pumping… …Have Increased Fleet Size and Quality * Includes acquisition of approximately 210,000 pressure pumping horsepower in October 2010 Growing Pressure Pumping Business

Southwest Region: 36 Northeast Region: Fracturing horsepower: 383,000 Other horsepower: 23,500 Fracturing horsepower: 293,000 Other horsepower: 58,000 A Significant Player in Regional Markets Pressure Pumping Areas of Operation