Energy Services of America (ESOA) 15th Annual Midwest IDEAS Investor Conference summary

Company history and structure

• Originated as a 2006 SPAC, acquiring three companies and later reorganized under new management in 2012, now operating six divisions with both union and non-union businesses.

• Significant growth in revenue, net income, and EBITDA over recent years, with the best year-to-date performance for the nine months ending June 2024.

• Main operations are in the Eastern U.S., with a focus on water and gas distribution, transmission, and general contracting.

• Key divisions include CJ Hughes (oil/gas transmission, water distribution), Nitro Construction (electrical, auto sector), and several acquired businesses.

• Recent acquisitions include Tri-State Paving, West Virginia Pipeline, and Ryan Construction, expanding capabilities and market reach.

Financial performance and growth

• Fiscal year 2023 revenue reached $304 million, with $7 million net income after tax and $20 million EBITDA.

• For the nine months ending June 2024, revenue was $247 million and pre-tax income $25 million, including a $15.6 million legal judgment.

• Gas and petroleum transmission, electrical/mechanical contracting, and water/gas distribution are primary revenue streams.

• Water distribution is a stable, profitable segment, with ongoing growth and recurring demand for infrastructure replacement.

• Backlog as of June 30, 2024, was $251 million, with 75-80% expected to be realized within twelve months.

Operational strategy and synergies

• Diversification across business lines and customers reduces reliance on any single sector, providing resilience against market downturns.

• Synergies exist between divisions, such as Nitro’s fabrication supporting CJ Hughes and shared customers like American Water and Mountaineer Gas.

• Acquisitions are targeted to fill service gaps, such as Tri-State Paving for utility restoration and Heritage Painting for coatings.

• Maintenance contracts provide steady work and position the company for larger capital projects with existing clients.

• Expansion into new markets, such as Michigan, and new services, like data storage and fiber optic work, are underway.