2. Cautionary Statement Regarding Forward-looking Information
This presentation contains, and the Company may from time to time make, written or oral "forward-looking statements" within the
safe harbor provisions of the Private Securities Litigations Reform Act of 1995. These statements include information with respect
to our financial condition and its results of operations and businesses. Words such as "anticipates," "expects," "intends," "plans,"
"believes," "seeks," "estimates," "may," "will," "continue," "project" and similar expressions, as well as statements in the future
tense, identify forward-looking statements.
These forward-looking statements are not guarantees of our future performance and are subject to risks and uncertainties that
could cause actual results to differ materially from the results contemplated by the forward-looking statements. These risks and
uncertainties include:
• The ability to obtain new contracts at attractive prices;
• The size and timing of customer orders;
• Fluctuations in customer demand;
• Competitive factors;
• The timely completion of contracts;
• The timing and size of expenditures;
• The timely receipt of government approvals and permits;
• The adequacy of local labor supplies at our facilities;
• The availability and cost of funds;
• General economic conditions, both domestically and abroad;
• The successful integration of acquisitions; and
• Fluctuations in foreign currencies.
The effects of these factors are difficult to predict. New factors emerge from time to time and we cannot assess the potential
impact of any such factor on the business or the extent to which any factor, or combination of factors, may cause results to differ
materially from those contained in any forward-looking statement. Any forward-looking statement speaks only as of its date and we
do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of such
statement or to reflect the occurrence of unanticipated events. In addition, see "Risk Factors" for a discussion of these and other
factors.
You are encouraged to read the SEC reports of DMC, particularly its Form 10-K for the Fiscal Year Ended December 31, 2010 for
meaningful cautionary language disclosing why actual results may vary materially from those anticipated by management.
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3. Cautionary Statement Regarding Forward-looking Information
Use of Non-GAAP Financial Measures
Non-GAAP results used in this presentation are provided only as a supplement to the financ ial statements based on U.S. generally
ac c epted ac c ounting princ iples (GAAP). The non-GAAP financ ial information is provided to enhanc e the reader's understanding of
DMC’s financ ial performanc e, but no non-GAAP measure should be c onsidered in isolation or as a substitute for financ ial measures
c alc ulated in ac c ordanc e with GAAP. Rec onc iliations of the most direc tly c omparable GAAP measures to non-GAAP measures are
provided within the sc hedules attac hed to this release.
EBITDA is defined as net inc ome plus or minus net interest plus taxes, deprec iation and amortization. Adjusted EBITDA exc ludes stoc k-
based c ompensation and, when appropriate, other items that management does not utilize in assessing DMC’s operating performanc e
(as further desc ribed in the attac hed financ ial sc hedules). None of these non-GAAP financ ial measures are rec ognized terms under
GAAP and do not purport to be an alternative to net inc ome as an indic ator of operating performanc e or any other GAAP measure.
Management uses these non-GAAP measures in its operational and financ ial dec ision-making, believing that it is useful to eliminate
c ertain items in order to foc us on what it deems to be a more reliable indic ator of ongoing operating performanc e and the c ompany’s
ability to generate c ash flow from operations. As a result, internal management reports used during monthly operating reviews feature
the adjusted EBITDA. Management also believes that investors may find non-GAAP financ ial measures useful for the same reasons,
although investors are c autioned that non-GAAP financ ial measures are not a substitute for GAAP disc losures. EBITDA and adjusted
EBITDA are also used by researc h analysts, investment bankers, and lenders to assess operating performanc e. For example, a measure
similar to EBITDA is required by the lenders under DMC’s c redit fac ility.
Bec ause not all c ompanies use identic al c alc ulations, DMC’s presentation of non-GAAP financ ial measures may not be c omparable to
other similarly-titled measures of other c ompanies. However, these measures c an still be useful in evaluating the c ompany’s
performanc e against its peer c ompanies bec ause management believes the measures provide users with valuable insight into key
c omponents of GAAP financ ial disc losures. For example, a c ompany with greater GAAP net inc ome may not be as appealing to
investors if its net inc ome is more heavily c omprised of gains on asset sales. Likewise, eliminating the effec ts of interest inc ome and
expense moderates the impac t of a c ompany's c apital struc ture on its performanc e.
All of the items inc luded in the rec onc iliation from net inc ome to EBITDA and adjusted EBITDA are either (i) non-c ash items (e.g.,
deprec iation, amortization of purc hased intangibles and stoc k-based c ompensation) or (ii) items that management does not c onsider to
be useful in assessing DMC’s operating performanc e (e.g., inc ome taxes and gain on sale of assets). In the c ase of the non-c ash items,
management believes that investors c an better assess the c ompany’s operating performanc e if the measures are presented without suc h
items bec ause, unlike c ash expenses, these adjustments do not affec t DMC' ability to generate free c ash flow or invest in its business. For
example, by adjusting for deprec iation and amortization in c omputing EBITDA, users c an c ompare operating performanc e without
regard to different ac c ounting determinations suc h as useful life. In the c ase of the other items, management believes that investors c an
better assess operating performanc e if the measures are presented without these items bec ause their financ ial impac t does not reflec t
ongoing operating performanc e.
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4. Key Data
(As of 3/26/10)
Symbol: NASDAQ GS: BOOM
52-week range: $8.50 - $23.17
Average daily trading volume (3 mo.): 173,416
Approx. market capitalization: $202 million
Shares outstanding: 13 million
Approximate float: 12.3 million
Fiscal year end: December 31
2009 revenue: $164.9 million
2009 EPS: $0.66
2009 EBITDA: $26.8 million
2009 operating cash flow: $29.5 million
Cash (12/31/09): $22.4 million
Quarterly dividend: $0.04
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5. Executive Management
! Yvon Pierre Cariou - President and CEO
! Richard A. Santa - Sr. Vice President,
CFO and Secretary
! John G. Banker - Sr. Vice President,
Customers and Technology
! Rolf Rospek - CEO, DYNAenergetics and
Oilfield Products segment
4
6. Company Overview
• World’s dominant provider of explosion-welded clad metal plates
- Diversified customer base in 8 primary end markets
- Significant barriers to entry
- International network of production and sales facilities
- $50 million order backlog at end of 2009
• Three business segments provide diversified revenue streams
• Strong operating cash flow and balance sheet
• Low Cap Ex business model facilitates strong free cash flow
• Talented management with deep industry experience
• Long-term growth strategy
5
9. Business Segments
2009 Revenue by Segment
Explosive Metalworking Oilfield Products AMK Welding
$134.1 Million $ 21.8 Million $ 9.0 Million
8
10. DMC’s Global Presence
Corporate Headquarters Oilfield Products Headquarters
Explosion Welding production centers Oilfield Products subsidiaries
Explosion Welding sales offices and agents Oilfield Products sales agents
9
11. DMC 2009 Revenue by Region
Russia
North America 5%
Europe
47% 23%
Asia
17%
Australia
2%
Other Countries -– 6%
10
12. Competing Cladding Technologies
Explosion Weld
Rollbond Weld Overlay
• Performed by small field of
• Performed by small international competitors led by • Arc-welding process
group of international Dynamic Materials Corporation typically performed
hot rolling steel mills by metal fabricators
• Most versatile cladding technology
• Thickness niche is • Thickness niche is
generally 2” and less • Only cladding process that can generally 6” and
address both compatible and non- greater
• Compatible metals compatible metals
only • Compatible metals
• Thickness sweet-spot is 1” to 6” only
Explosive Metalworking 11
14. Explosion Clad - a Critical Weapon in the Battle Against Rust
! “…a major industry challenge
is the ‘rust crisis’ in the global
energy infrastructure”
! “Worldwide energy
infrastructure too old”
! Most infrastructure “far
beyond original design life”
From presentation at 2009 Offshore Technology Conference
Matthew Simmons, Chairman - Simmons & Company International
Explosive Metalworking 13
15. Explosion Welding – a Key Step in Pre-fabrication Process
Explosion
Metal Suppliers Welding Fabricators
MILLS & SERVICE CENTERS
Sourced Metals End Users
• Carbon Steel
• Nickel Alloys
• Titanium
• Zirconium
Explosive Metalworking 14
16. Selected End Markets Served by Explosion Welding
Corrosion
• Oil & Gas industry • Power generation
• Petrochemicals / chemicals • Hydrometallurgy
• Alternative energy • Industrial refrigeration
Transition Joints
• Aluminum production • Shipbuilding
Above are several of the many industries that rely on explosion welding
Explosive Metalworking 15
17. End Users Include Leading Players in Respective Fields
Fabricators
Morimatsu Group China
End Users
Chemicals Refinery Mining Engineering
Explosive Metalworking 16
18. DMC’s Dominant Industry Position Protected by Significant
Barriers to Entry
" Global network of specialty-metals suppliers
" Permits and shooting sites in U.S., France, Sweden & Germany
" Mastery of explosion-welding process in large-scale production
" Strong working relationships with end-market customers
Explosive Metalworking 17
19. Oilfield Products Segment
• Manufactures explosive perforating
systems and seismic devices for the
international oil & gas services industry
• Growing presence in critical
international energy markets
• Recognized within industry for product
and technology innovation
• Extension of DMC’s expertise in
specialized explosive manufacturing
processes
• Generated 13% of DMC sales in 2009
Oilfield Products 18
20. Explosive Perforating
The Perforation Process
1. After a wellbore is drilled and the
cement casing is in place, a
perforating gun is deployed into
the well
2. The gun is fired, sending steel
projectiles through the casing and
into the surrounding formation
creating “perforation tunnels”
3. Oil or gas flows through
perforation tunnels and into the
well
Oilfield Products 19
