Contact Energy Limited · NZX:CEN
Contact Energy — UBS Australasia Conference 2021
16 slides from Contact Energy's conference presentation, Nov 15, 2021
Slide 1: UBS Australasia Conference November 2021
UBS Australasia For personal use only Conference November 2021 1
Slide 2: Disclaimer and important information
Disclaimer and important information For personal use only This presentation may contain projections or forward-looking statements regarding a variety of items. Such forward-looking statements are based upon current expectations and involve risks and uncertainties. Actual results may differ material
Slide 3: Strategic evolution
Strategic evolution Our previous strategy focused on efficient operations and use of capital which has delivered sector leading For personal use only performance efficiency Profitable operations Strong cash conversion Reducing our cost base Operating free cash flows per MWh, $/MWh Operating free cas
Slide 4: Strategic delivery
Strategic delivery For personal use only Our focus has delivered solid EBITDAF over the past four years despite volatile wholesale markets and rising thermal fuel costs. Contact is now positioned well for growth EBITDAF, $M, continuing operations rolling 12 months average FY18 FY19 FY20 FY21 582 595
Slide 5: Strategic capability
Strategic capability Additionally, we have developed, acquired, or partnered with distinctive capabilities to position us for growth For personal use only Strong geothermal capabilities Geothermal Strategic acquisitions and partnerships Enhanced customer experiences driving generation cash-costs exc
Slide 6: Two structural shifts impact the NZ electricity market
Two structural shifts impact the NZ electricity market For personal use only 1 Decarbonising the economy End of NZAS 2 supply agreement 6
Slide 7: Decarbonising the economy
1 Decarbonising the economy For personal use only Decarbonisation imperatives and technology improvements will accelerate electricity demand growth Key drivers of decarbonisation The Climate Change Commission expects electricity demand Key drivers to grow to meet climate targets Electricity demand,
Slide 8: NZAS supply agreement
2 NZAS supply agreement For personal use only Decarbonisation provides the opportunity for growth Change in electricity demand and supply, TWh 6 5 Demand, NZAS exit Demand, including NZAS 4 New supply (cummulative) Implication for Contact 3 Our imperative is to 2.0 deliver on our commitment 2 1.4 +6
Slide 9: Positioning Contact for the future
Positioning Contact for the future Decarbonisation and the end of the NZAS supply agreement could For personal use only leave the electricity market looking very different by 2030 How the electricity market will change? Baseload Intermittent Batteries and Long-term thermal exits renewables large-sca
Slide 10: Leading decarbonisation
Leading decarbonisation For personal use only We are best positioned to enable decarbonisation New Zealand’s Proven best renewable Leading NZ thermal decarbonisation development pipeline generation transition growth platform We have a pipeline of options We have led the economic substitution Combini
Slide 11: Our strategy to lead NZ's decarbonisation
Our strategy to lead NZ’s decarbonisation For personal use only Strategic Grow Grow renewable Decarbonise Create outstanding theme demand development our portfolio customer experiences Objective Attract new industrial Build renewable generation Lead an orderly Create NZ's leading sustainable demand
Slide 12: Our ambitious measures of success
Our ambitious measures of success For personal use only Strategic Grow Grow renewable Decarbonise Create outstanding theme demand development our portfolio customer experiences Metrics & Senior in-house capability to Tauhara online by 2023 Complete thermal review in Top 10 ‘most trusted retailer’ me
Slide 13: Financial strategy
Financial strategy Our strategy grows shareholder value by generating cash flows from strategic investments, backed by new demand For personal use only Grow our business Generate returns on our capital investments Fiscal discipline to maximise returns Build a pipeline Generate Return capital of dema
Slide 14: Growth investment funding strategy
Growth investment funding strategy Complementing conventional debt funding and hybrid debt instruments, Contact has already accessed equity For personal use only funding to support our base case investment programme Medium-term capital investment programme Potential sources of funding (uncommitted)
Slide 15: Delivering on strategic capital deployment
Delivering on strategic capital deployment The base business earnings in the short-term are leveraged to fuel availability. In the medium-term to NZAS For personal use only retention or replacement success. Longer term, strategic capital deployment will drive earnings growth. Assumptions EBITDAF fro
Slide 16: Our operational plan
Our operational plan What you can expect in the next 18 months For personal use only Strategic theme H1-FY22 H2-FY22 H1-FY23 Hydrogen registration of interest Assess hydrogen position Develop hydrogen option followed by request for proposals Grow Build data centres Data centres online Advance data c