Transurban Group Ltd. · ASX:TCL
Transurban — Morgans Business Breakfast (February 2014)
27 slides from Transurban's conference presentation, Feb 19, 2014
Slide 1: Morgans Business Breakfast
MORGANS BUSINESS BREAKFAST SCOTT CHARLTON, TRANSURBAN CEO 19 FEBRUARY 2014
Slide 2: Disclaimer & Basis of Preparation
DISCLAIMER & BASIS OF PREPARATION This publication is prepared by the Transurban Group comprising Transurban Holdings Limited (ACN 098 143 429), Transurban Holding Trust (ARSN 098 807 419) and Transurban International Limited (ACN 121 746 825). The responsible entity of Transurban Holding Trust is T
Slide 3: CityLink, Melbourne
CITYLINK, MELBOURNE
Slide 4: Eastern Distributor, Sydney
EASTERN DISTRIBUTOR, SYDNEY
Slide 5: Lane Cove Tunnel, Sydney
, LANE COVE TUNNEL, SYDNEY
Slide 6: Hills M2, Sydney
> Ww Zz a) > ep) ai = ep) | = ae
Slide 7: M5 South West, Sydney
| taal = M5 SOUTH WEST, SYDNEY
Slide 8: Westlink M7, Sydney
oy ~ : . » S| ae Fae ba WESTLINK M7, SYDNEY " ———e ——— be a PY) i /
Slide 9: 495 Express Lanes, Virginia, USA
495 EXPRESS LANES, VIRGINIA, USA
Slide 10: Strategy
STRATEGY DIFFERENTIATED MODEL ROAD INFRASTRUCTURE COMPETITIVE CLEAR MARKET PARTNER OF CHOICE ADVANTAGE DEFINITION Providing effective and Network planning and Eastern seaboard of innovative urban transport forecasting Australia and northern solutions Operations and customer Virginia, USA A
Slide 11: Sustainability Framework
SUSTAINABILITY FRAMEWORK ENHANCING OUR LICENCE TO OPERATE BE GOOD USE THINK NEIGHBOURS LESS LONG-TERM MANAGEMENT METHODOLOGY
Slide 12: Our Markets
OUR MARKETS AUSTRALIA AND VIRGINIA, USA
Slide 13: Transurban Track Record
TRANSURBAN TRACK RECORD TRACK RECORD OF INVESTMENT IN MAJOR ROAD NETWORKS Transurban has led every major toll road upgrade undertaken in Australia by the private sector in the past 15 years. Transurban’s market capitalisation growth and investment / Development history since 2004 11-Nov-2013 Acquisi
Slide 14: Owner Operator Model
OWNER OPERATOR MODEL PROVEN MODEL GLOBALLY Major privately owned and operated global toll roads Significant ownership by a Strategic Player Predominantly Financial M4 Don Highway Investors 400km Shanghai-Nanjing G312 282 km Guiliu Sanef – A1, A2, A4, Expressway Sapn – A13, A14, A29 Yongtaiwen A16, A
Slide 15: Half-Year Highlights
HALF-YEAR HIGHLIGHTS FINANCIAL Average daily traffic growth – Proportional toll Proportional FY14 distribution Australian assets revenue growth1 EBITDA growth guidance increased 3.4 % 13.1% 11.1% 35 ¢ 1. Refer to slide 2 for explanation of proportional toll revenue and proportional EBITDA. 15
Slide 16: Half-Year Highlights: Distribution Growth
HALF-YEAR HIGHLIGHTS DISTRIBUTION GROWTH FY14 distribution guidance 2009 2010 2011 2012 2013 2014 of 35 cents (increased from 34 cents) 35¢ Expectation of 7 cent 31¢ 29.5¢ fully franked dividend 27¢ component 24¢ 22¢ Expected to be 100% free cash covered Interim distribution of 17 cents decl
Slide 17: Half-Year Highlights: Operational
HALF-YEAR HIGHLIGHTS OPERATIONAL TOLLING & CUSTOMER OPERATIONS & CORPORATE MANAGEMENT MAINTENANCE Work under way Successfully completed Inaugural debt capital to roll out GLIDe tolling major resurfacing on markets financing for system on Sydney assets CityLink tunnels Transurban’s NSW assets
Slide 18: Half-Year Highlights: Safety
HALF-YEAR HIGHLIGHTS SAFETY TRANSURBAN'S INJURY COLLISION INDEX (MAJORITY-OWNED ASSETS) CUSTOMER SAFETY IMPROVEMENTS NSW Injury collisions per 100 million vehicle kilometres 8 Upgrade to signage and traffic management system 7 on Eastern Distributor under way as part of broader 6 operations system
Slide 19: Half-Year Highlights: Network Development
HALF-YEAR HIGHLIGHTS NETWORK DEVELOPMENT VICTORIA NSW USA Working with Victorian M2 Upgrade complete 95 Express Lanes 66% Government to develop complete interface with East-West M5 West Widening – Beltway capital restructure Link 63% complete under way to ensure asset Considering potenti
Slide 20: Half-Year Highlights: Portfolio Development
HALF-YEAR HIGHLIGHTS PORTFOLIO DEVELOPMENT FINANCIAL YEAR 2008 2009 2010 2011 2012 2013 2014 2015 2016 95 EXPRESS LANES $991.4 $943.9 M5 WIDENING $891.0 CROSS CITY TUNNEL1 $773.9 ✔ $724.9 PROPORTIONAL $688.7 HILLS M2 UPGRADE TOLL REVENUE ✔ AU$ MILLIONS 495 EXPRESS LANES ✔ M1 – CITYLINK UPGRADE ✔ LAN
Slide 21: Hills M2 Upgrade
HILLS M2 UPGRADE TRAVEL TIME SAVINGS Alternate route: Old Windsor Road/Pennant Hills Road/Carlingford WESTBOUND Hills M2 Alternate route Road/Epping Road between Seven Hills Road and Lane Cove Tunnel EASTBOUND 21
Slide 22: M1-M2 Proposal: Key Milestones
M1-M2 PROPOSAL KEY MILESTONES CONTRACTOR ENVIRONMENTAL GOVERNMENT PROCUREMENT IMPACT STATEMENT APPROVAL December March April September Late 2013 2014 2014 2014 2014 v Tenders Preferred Public exhibition Targeted Targeted received and contractor of Environmental project financial assessed selected Im
Slide 23: M1-M2 Proposal: A New Procurement Model
M1-M2 PROPOSAL A NEW PROCUREMENT MODEL COMPARATIVE ADVANTAGES OF PRIVATE SECTOR LED PROCUREMENT OF M1-M2 Outcome Mandatory functional requirements document (8 pages) rather than prescriptive Scope of Work and Technical Criteria focus driving (1,000s of pages) – this enabled bidders to bring innova
Slide 24: Investment Discipline
INVESTMENT DISCIPLINE RECENT EXAMPLE TRAFFIC COMPARISON – INDEXED CUMULATIVE CAPEX COMPARISON – 1.8 INDEXED 120.00 1.61 vendor P50 case 91 38% above 80.00 Vendor capex 1.4 TCL traffic estimate over 1.40 estimates at concession life concession 34% of TCL end capex estimate 40.00 31 1.17 1.0 Jan 2013
Slide 25: Queensland: Potential New Market
QUEENSLAND POTENTIAL NEW MARKET Network of QML assets presents strategic opportunities consistent with existing TCL networks Sector specialist focused purely on road network operation and development Complex network and future investment requirements present opportunities for TCL’s operational
Slide 26: Queensland: Potential New Market
QUEENSLAND POTENTIAL NEW MARKET Process for sale of QML under way TCL participating alongside strategic partners Consortium members among the largest Australian and global funds, including AustralianSuper – collectively manage ~$77 billion in Australian superannuation funds with more than 2 mi
Slide 27: Conclusion
CONCLUSION PORTFOLIO FREE CASH NEW MANAGEMENT GROWTH OPPORTUNITIES Continuing focus on Strong first half free cash Victorian opportunities to operational efficiencies and supports full year growth expand Western Link active network management outlook section of CityLink Expansion of Transurb
Transurban Group — Morgans Business Breakfast (February 2014) on 6ix