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Investor Day November 18, 2010 PowerPoint Presentation
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Investor Day November 18, 2010

Investor Day November 18, 2010

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Investor Day November 18, 2010

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  1. TSX:SPB Investor DayNovember 18, 2010

  2. Forward-Looking Statementsand Non-GAAP Measures Certain information included herein is forward-looking, within the meaning of applicable Canadian securities laws. Forward-looking information can be identified by looking for words such as “believe”, “expects”, “expected”, “will”, “intends”, “projects”, “anticipates”, “estimates”, “continues” or similar words. Forward-looking information in this corporate presentation, including the 2010 and 2011 Financial Outlooks, includes but is not limited to consolidated and business segment outlooks, expected EBITDA from operations, expected Adjusted Operating Cash Flow, expected Adjusted Operating Cash Flow per share, future capital expenditures, business strategy and objectives, future dividend payments, dividend strategy, expected senior debt and total debt to EBITDA ratios, future cash flows, anticipated taxes and statements regarding the future financial position of Superior and Superior LP. Superior and Superior LP believe the expectations reflected in such forward-looking information are reasonable but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Forward-looking information is based on various assumptions. Those assumptions are based on information currently available to Superior, including information obtained from third-party industry analysts and other third- party sources, and include the historic performance of Superior's businesses, current business and economic trends, availability and utilization of tax basis, currency, exchange and interest rates, trading data, cost estimates and the other assumptions set forth under the “Outlook” sections contained in the 2010 third quarter results. Readers are cautioned that the preceding list of assumptions is not exhaustive. Forward-looking information is not a guarantee of future performance and involves a number of risks and uncertainties, some of which are described herein and in the 2010 third quarter results. Such forward-looking information necessarily involves known and unknown risks and uncertainties, which may cause Superior's or Superior LP's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking information. These risks and uncertainties include but are not limited to the risks referred to under the section entitled “Risk Factors to Superior”, in the 2010 third quarter results, the risks associated with the availability and amount of the tax basis and the risks identified in Superior's 2009 Annual Information Form under the heading “Risk Factors”. Any forward-looking information is made as of the date hereof and, except as required by law, neither Superior nor Superior LP undertakes any obligation to publicly update or revise such information to reflect new information, subsequent or otherwise. All dollar amounts are in Canadian dollars unless otherwise noted.

  3. Business Overview • Superior Plus – ‘Three Businesses – ONE Investment’ • Energy Services • Specialty Chemicals • Construction Products Distribution • Converted to a corporation on December 31, 2008 • High-yielding corporation • Excellent access to capital • Focused on improving efficiency and organic growth generation • Attractive acquisition and geographic / market expansion opportunities in all three businesses • North American focused with 4,800 employees

  4. Financial Profile – SPB (1) Closing market price on November 9, 2010 (2) Annualized dividend of $1.62 is based on the November 2010 dividend of $0.135 per month (3) As at September 30, 2010 (4) Excludes deferred issue costs

  5. Strong Management Capability PositionAge Grant Billing Chief Executive Officer 59 Wayne Bingham Chief Financial Officer 54 John Gleason President, Energy Services and Propane51 Greg McCamus President, U.S. Refined Products and Fixed-Price Products 52 Eric McFadden EVP, Business Development 47 Paul Timmons President, Specialty Chemicals61 Dave Tims SVP, Commodity Portfolio Management 49 Paul Vanderberg President, Construction Products Distribution51

  6. Superior Plus Market Diversification Energy Services Specialty Chemicals Construction Products Distribution • Based on mid-point of Superior’s 2011 Financial Outlook on an EBITDA from operations basis as provided in Superior’s third quarter MD&A 6

  7. Energy Services John Gleason Today’s Presenters Superior Plus Grant Billing Superior Plus Wayne Bingham Construction Products Distribution Paul Vanderberg Specialty Chemicals Paul Timmons

  8. TSX:SPB Construction Products Distribution

  9. Business Overview • Leading distributor of Walls and Ceilings Products and Commercial and Industrial insulation in Canada and the U.S. • Commercial • Residential • Industrial • Fabrication services • Productivity partner with contractors providing value-added services • Operational: 115 distribution centers, including 13 fabrication facilities, across 6 provinces and 30 states • Approximately 1,450 employees

  10. Commercial – New Commercial – Renovation Industrial Residential End-Use Market Diversification ‘The Construction Products Distribution business is diversified across geographic and end-use markets’ % based on 2010 Estimated Revenue by Segment

  11. Branch Locations‘A North American Focus’ 11

  12. 2010 Initiatives • Cost reduction programs • End-use markets have been challenging • Extensive focus on operating costs • $4.2 million in restructuring expense 9 month ytd 2010 • Costs savings are reflected in the 2011 Outlook • Integration • Cost reduction focus • Incremental approach in certain Walls and Ceilings locations 12

  13. 2010 Initiatives • June 2010 acquisition of Burnaby Insulation • C&I entry into Canada • Serves Western Canada industrial market • Base to build on, particularly related to Oil Sands opportunities • Strengthened management team • Key hires from industry, internal promotions • Restructured procurement function 13

  14. Market Overview – Residential Source: Dept. of Commerce, CMHC, Company Forecast 14

  15. Market Overview – Non-Residential Source: McGraw Hill, CanaData 15

  16. Market Overview – Industrial Source: IIR 16

  17. West North ▼ Fabrication South Insulation Fabrication Services • Value-added to customers • Conversion of raw materials into products of specific sizes and shapes • Located strategically near large industrial and commercial markets

  18. Energy Efficiency Trends • Positive growth from energy efficiency trends • Insulation role in energy efficiency and reducing greenhouse gas emissions • Insulation in existing commercial buildings saves at least 30% of the total U.S. commercial energy consumption that otherwise would have been consumed (1) • Insulation single most cost-effective greenhouse gas abatement measure (2) • Government legislation requiring improved energy efficient standards • New federal buildings required to achieve 30% greater energy efficiency • ASRAE 2010 standards for mechanical insulation under consideration • Sustainable design standards (LEED and Green Globe) (1)Owens Corning study. (2)McKinsey & Company’s Report on Greenhouse Gas Reduction.

  19. Growth Opportunities • Product line expansion: • Full walls + ceilings product line in 23 architectural centres • C+I insulation in walls and ceilings centres • Geographic growth and consolidation: • Selective acquisitions • Greenfield • Business positioned for end-use market recovery • Significant leverage to economic recovery

  20. 2010 and 2011 Financial Outlook Bridge Construction Products Distribution (1) As provided in Superior’s 2010 third-quarter MD&A 20

  21. Summary • Leading market positions with cost structures aligned with current volumes • Energy efficiency trends support increase insulation usage • Positioned to grow based on SPI network • Significant leverage to economic recovery

  22. TSX:SPB Questions & Answers

  23. TSX:SPB Energy Services

  24. Canadian propane distribution Canada’s largest retail supplier of propane Full service offering U.S. northeast refined fuels Significant heating oil, propane and distillates platform in the northeastern U.S. Full service offering Supply and portfolio management Leading natural gas liquids marketing company with potential to add the northeastern U.S. to its portfolio Fixed-Price Energy Services Leading Canadian energy marketer offering natural gas and electricity plans to commercial customers in Ontario, Quebec and British Columbia Energy Services

  25. Canadian Propane Distribution U.S. Refined Fuels Wholesale Supply Management Fixed-Price Energy Services Energy Services Diversification ‘The Energy Services business is well diversified across various geographic and end-use markets’ Based on gross profit by business for the nine-month period ended September 30, 2010

  26. Superior Propane is a recognizable Canadian brand – in business since 1951 Canada’s largest supplier of propane, related products and services Annual volumes: 1.3 billion litres 160,000 customers coast-to-coast Canada 125,000 residential customers (150 million litres) 35,000 commercial/business customers (1.15 billion litres) Employees: 1,600 coast-to-coast A recognized leader in propane safety Canadian Propane Business Overview

  27. Canadian Propane Geographic Diversification Western Canada 54% Eastern Canada 38% Atlantic Canada 7% Volume by region for the twelve-month period ended December 31, 2009.

  28. Canadian Propane 2010 Initiatives Technology-Based Initiatives Enterprise One (ERP) Upgrade completed in 2nd quarter 2010 Costs savings of approximately $7.0 million anticipated in 2011 On-Board Truck Computers and UPS Roadnet Improved connectivity with front-line staff results in operations efficiencies and more efficient delivery routes Sales and Marketing Initiatives 60 person sales force – face-to-face with customers in the field Sales team has produced positive results with annualized new customer volumes of approximately 119 million litres Voice-to-Voice team services the Residential line of business Organization-wide ‘Customer Service Commitment”

  29. U.S. Refined Fuels Business Overview Three U.S. Refined Fuel acquisitions in 2009/10 for US$308 million Residential and Commercial heating oil, propane, and commercial fuels distribution Sunoco Home Comfort, Griffith Consumers, Griffith Energy Annual volumes – 463 million gallons (1.7 billion litres) 223,000 customers – 91% residential Full service offering including HVAC installation, repair and maintenance Well maintained storage and distribution assets Four pipeline-supplied terminals and 44 retail bulk plants provide 31 million gallons of storage capacity Strong health, safety and environmental track record 29

  30. U.S. Refined Fuels Geographic Diversification Location Terminal Albany Rochester Syracuse Binghamton Buffalo Scranton New York State College Harrisburg Philadelphia Pittsburgh 30

  31. Gallons Households (millions) (000s) Mid - West Mid - Atlantic U.S. Refined Fuels Market Analysis • National Oilheat Research Alliance estimates 43% of total heating oil consumption is in mid-Atlantic Region from Virginia to New York • New York and Pennsylvania have an estimated 3.5 million homes fueled by heating oil • 33% of New York households and 25% of Pennsylvania households use heating oil as their primary source of energy Heating Oil Market Data Heating Oil Usage Percentage of Total Heating Oil Consumption 50% State / District 43% 40% New York 2,463 2,336 Pennsylvania 1,286 1,217 31% 30% 30% New Jersey 612 595 NY Virginia 431 362 20% and Maryland 308 316 PA 11% 10% 10% Delaware 64 77 6% District of Columbia 33 17 0% Total Mid-Atlantic 5,197 4,920 West South New England Source: National Oilheat Research Alliance, 2008.

  32. U.S. Refined Fuels 2010 Initiatives Completed the acquisition of Griffith Energy (January, 2010) Integration of the three businesses substantially complete One-time costs of $3.2 million incurred in 2010 Combined some operations in New York and Pennsylvania Rebranding to Superior Plus Energy Services well underway Hired Key Leadership roles, including a VP of Sales Established a new organizational structure Operational focus on sales and customer retention and satisfaction

  33. Supply Portfolio Management Supply Portfolio Management group provides expertise in wholesale supply, risk management and logistics to Superior’s businesses Third-party marketing accounts for about one-third of all activity with strong growth potential Continued growth of third party business allows higher utilization of storage and transportation assets Ability to optimize value of terminals, storage, rail transport and pipeline capacity Significant propane and butane storage in Alberta, Michigan, New York state, Kansas and Texas 33

  34. Wholesale Supply Market Footprint EDMONTON REGINA MARYSVILLE/SARNIA BATH CONWAY Supply Region Wholesale Market Region Transport Flow Storage MOUNTBELVIEU 34

  35. Energy Services Opportunities Canadian Propane Customer Growth Initiatives Continued focus on sales and marketing to attract and retain customers Build and execute on a plan to leverage our safety expertise Target existing customers and further penetrate with service offerings Productivity Improvement Opportunities Integration of ERP upgrade and web-based customer service applications and other technology improvements Ability to pay for propane on-line and update account information Continue to refine ERP and internal processes to improve cost structure 35

  36. U.S. Refined Fuels Pursue propane and propane service expansion opportunities across all markets in the Northeastern U.S. Cross-selling opportunities in conjunction with the Fixed-Price Energy Services business (electricity and natural gas) offerings to be introduced to existing customer base Continue to improve cost structure by identifying back- office synergies and productivity improvements U.S. industry consolidation opportunities Potential tuck-in acquisitions in highly fragmented N.E. Heating Oil market Energy Services Opportunities 36

  37. Energy Services Opportunities Supply Portfolio Management • Leverage and diversify current storage locations and supply relationships to expand market presence • Expanded product offering • Offer supply and risk management solutions to customers 37 37

  38. 2010 and 2011 Financial Outlook Bridge Energy Services (1) As provided in Superior’s 2010 third-quarter MD&A 38

  39. Energy Services Summary Strong brand and leading positions in both end-use and geographic markets across Canada Strong focus on customer service Plans in place to grow existing customer base Continued focus on productivity improvements and cost-saving initiatives to generate ongoing efficiencies

  40. TSX:SPB Questions & Answers

  41. TSX:SPB Specialty Chemicals

  42. Business Overview • Manufacturer and supplier of specialty chemicals and provider of technology-related services • Second-largest producer of sodium chlorate in North America and worldwide with an estimated production capacity of 26% and 15%, respectively • Third largest producer of Potassium Chloralkali products in North America. Successful startup of Port Edwards, Wisconsin facility in Q4 2009 • Nine manufacturing facilities • Approximately 500 employees

  43. Product Diversification North American Chlorate International Chlorate Chloralkali Technology ‘Superior has diversified its Specialty Chemical Business’ 2009 EBITDA 2004 EBITDA

  44. Geographic Footprint CANADA Grande Prairie Saskatoon Thunder Bay Hargrave Vancouver Buckingham Toronto Port Edwards USA Valdosta BRAZIL ARGENTINA CHILE URUGUAY • 500 employees • 510,000 MT sodium chlorate capacity from 7 plants • 10,500 MT sodium chlorite capacity from 2 plants – largest worldwide • 39,000 MT chloralkali product capacity at Saskatoon • 103,000 MT potassium & chloralkali products at Port Edwards • Sales offices – China and Japan

  45. 2010 Capital Initiatives • Sodium chlorate – efficiency improvement projects • Electrical energy ±10% reduction • Valdosta, Georgia • Hargrave, Manitoba • Hydrogen utilization at the Chilean facility • Ownership of electrical generation – Chile • Vancouver rectifier and debottlenecking • Total capital projects of approx. $30 million with a minimum 15% ROI • Pipeline of future opportunities

  46. Pulp Market Update • Pulp inventories are at normalized levels – approximately 35 days of inventory • Pulp prices remain high providing support for sodium chlorate markets • Many closed mills have re-started Pulp statistics current as at November 10, 2010

  47. Chlorate Market Update • Sodium chlorate market tight • Producer operations problems – France/USA • Pulp mills running at high utilization rates • 80,000 tonnes demand has returned to North American market • ERCO on order control – price increases announced

  48. Chloralkali Market Update • 2010 industry operating rates continued to increase, currently above 90% • Gulf Coast chlorine derivatives exports very high (EDC, vinyl etc) • Market conditions should be sustainable due to: • USD currency weakness • Low natural gas price • Chinese industry operating rates are stated as being in the 60% range • Power constraints and high feedstock costs

  49. Chloralkali Market Update ‘Chloralkali margins are well positioned relative to past economic downturns’ Source: CMAI

  50. South American Expansion Opportunities • Brazil and Chile are low cost pulp regions • Superior will look to leverage its existing relationship with CMPC • Chilean facility completed in 2005 • CMPC is a low cost pulp producer with a market capitalization of US$10 billion as at July 2010 • Opportunity to grow in Brazil as a result of CMPC growth • Brazil opportunities include: • Sodium chlorate facilities • Sodium chlorite facilities • Alkali products • Export from North American facilities