Unitil Corporation · NYSE:UTL
Unitil — East Coast Ideas Investor Conference June 2019
19 slides from Unitil's conference presentation, Jun 12, 2019
Slide 1: East Coast Ideas Investor Conference June 2019
EAST COAST IDEAS INVESTOR CONFERENCE JUNE 2019 Thomas P. Meissner, Jr. Chairman, Chief Executive Officer and President Exhibit 99.1
Slide 2: Safe Harbor Provision
SAFE HARBOR PROVISION This presentation contains “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements regarding Unitil Corporation’s (“Unitil”) financial condition, result
Slide 3: About Unitil
Unitil Corporation is a public utility holding company whose mission is to safely and reliably deliver energy for life and provide our customers with affordable and sustainable energy solutions Investment grade utility Diversified Net Utility Plant of more than $1 billion Gas 65%, Electric 35% NH 44
Slide 4: Prosperous Service Areas
PROSPEROUS SERVICE AREAS *Source: Building permit data from U.S. Census Bureau Building Permits Survey. Unemployment data from U.S. Bureau of Labor Statistics Building Permits Up 22% in Maine since 2015; almost double the national average Strong Employment Growth NH added over 20,000 jobs in 2018 Un
Slide 5: Recent Highlights
RECENT HIGHLIGHTS Eighth consecutive year of record earnings Net income rose 13.8% to $33.0 million EPS rose 8.3% to $2.23/share Focusing on Growth Opportunities Gas franchise expansions approved to serve three new towns in New Hampshire Ongoing expansion into two cities in Maine Increased investmen
Slide 6: Historical Performance
HISTORICAL PERFORMANCE Total Shareholder Return * Data as of 12/31/2018 PAGE Unitil has outperformed the broader markets and the utility industry
Slide 7: Regulated Distribution Model
REGULATED DISTRIBUTION MODEL Regulated utilities are natural monopolies with an obligation to safely and reliably serve customers Returns are driven by investments in utility plant Revenue Requirement = Rate Base × Allowed Rate of Return + Expenses Generation and transmission costs do not impact ear
Slide 8: Operational Excellence
OPERATIONAL EXCELLENCE Ranked #1 in New England for overall customer satisfaction Leading gas emergency response and pipeline safety programs Responded to >99.9% of emergency calls in less than 60 minutes Advanced data collection to capture and integrate asset information in real time Dynamic mobile
Slide 9: Customer Growth
CUSTOMER GROWTH Service Area Expansions Innovative Targeted Area Buildout (TAB) programs in Maine Gas franchise expansions to serve three new towns in New Hampshire Installed approximately 100 miles of new distribution mains over the past 5 years Natural Gas Opportunity Cleaner and more affordable t
Slide 10: Infrastructure Modernization
INFRASTRUCTURE MODERNIZATION PAGE Regulatory initiatives in MA and NH support new investments to modernize the electric system MA – implementation started, total spending of ~$25 million over ten years with strong cost recovery NH – plan under development, with estimated spending of ~$60 million Ele
Slide 11: Increasing Investment
INCREASING INVESTMENT Total Rate Base growth of 7.6% over the past five years Revenue Requirement = Rate Base × Allowed Rate of Return + Expense Recovery Increased capital spending program to support gas growth and distribution system modernization 20% more capital spending projected in 2019-2021 th
Slide 12: Financial Strength
FINANCIAL STRENGTH Declining payout ratio – down from 77% to 66% over the last 5 years – while also increasing the annual dividend each year Plowing back more earnings will help fund increase in investment program Investment grade rating Standard & Poor’s issuer rating of BBB+ across Unitil Corporat
Slide 13: Regulatory Activity
REGULATORY ACTIVITY Notice provided to the Maine PUC of intent to file a gas base rate case for Northern Utilities (ME only) Approximate revenue deficiency request of $7.0 million Final order and updated rates expected in Q2 2020 Recent order from MA DPU doubles limit on annual cash recovery of gas
Slide 14: Key Investment Highlights
Regulated local distribution utility business model Growing service areas and customer base Diversified natural gas and electric operations Dividend strength Experienced management team Regulated local distribution utility business model Growing service areas and customer base Diversified natural ga
Slide 15: Appendix
APPENDIX PAGE
Slide 16: Low Risk Utility in New England
LOW RISK UTILITY IN NEW ENGLAND Northern Utilities – Operates in Maine and New Hampshire Local gas distribution company Service area along the seacoast, including Portland the largest city north of Boston Unitil Energy Systems – New Hampshire Electric distribution utility providing service to the se
Slide 17: Expansion Opportunities
EXPANSION OPPORTUNITIES Increased total sales margin by $6.9 million or 3.4% compared to prior year, net of tax reduction 5-Year Gas and Electric margin CAGR of 5.3% More than 10,000 customers added in last 5 years NH gas franchise expansions Received regulatory approval for three new franchise requ
Slide 18: Return on Equity
RETURN ON EQUITY Company Average Common Equity (as of 03/19) LTM ROE (as of 03/19) (1) Northern Utilities (New Hampshire) $201.5 8.2% Northern Utilities (Maine) Unitil Energy $81.8 9.9% Fitchburg (Electric) $78.1 5.1% Fitchburg (Gas) Granite State $14.2 10.7% Unitil Corporation $361.0 12.2% PAGE (1)
Slide 19: 2019 Rate Relief Summary
2019 Rate Relief Summary Company Activity Dollars (in Millions) Date Effective Northern Utilities (New Hampshire) 2018 Rate Relief (Net of TCJA) Capital Tracker - 2019 $0.6 $1.4 Q1/Q2 2018 Q2 2019 Northern Utilities (Maine) 2018 Rate Relief (Net of TCJA) Capital Tracker – 2019 $1.0 $1.0 Q1/Q2 2018 Q
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