Orsted · OMXCOP:ORSTED
Orsted — DONG Energy — Q1 2014 Earnings Presentation
21 slides from Orsted's earnings presentation, May 1, 2014
Slide 1: Moving Energy Forward: Interim Financial Report Q1 2014
MOVING ENERGY FORWARD INTERIM FINANCIAL REPORT Q1 2014 1 May 2014
Slide 2: Disclaimer
Disclaimer Certain statements in this presentation are based on the beliefs of our We urge you to read our annual report available on our website at management as well as assumptions made by and information currently www.dongenergy.com for a discussion of some of the factors that could available to
Slide 3: Q1 2014 highlights
Q1 2014 highlights Financials Q1 2014 RESULTS 3
Slide 4: Satisfactory Q1 results
Satisfactory Q1 14 results Highlights Q1 14 Group EBITDA (DKKbn) EBITDA of DKK 6.3bn (up 37% y/y) Equity injection and sale of stake in London Array 15.0 14.1 13.7 Low net debt level after equity injection and +37% divestment of stake in Array 8.6 6.3 FFO1/Adjusted net debt of 44% (23% in 20
Slide 5: Equity injection and Board composition
Equity injection and Board composition Equity injection OWNERSHIP PRE EQUITY INJECTION Equity injection of DKK 13bn completed on 20 February 2014 Danish State (81.0%) at an extraordinary General Meeting SEAS-NVE (10.9%) SYD ENERGI (3.5%) DKK 11bn from new investors and DKK 2bn from existing Inse
Slide 6: Three UK wind projects awarded CfD contracts
Three UK wind projects awarded CfD contracts DONG Energy has in April 2014 been awarded FID enabling CfD contracts for three UK projects The projects are the Walney Extension (660MW), Burbo Bank Extension (258MW) and Hornsea (1,200MW) Contracts for Difference (CfD) is the successor to the curr
Slide 7: Financials
Q1 2014 highlights Financials Q1 2014 RESULTS 7
Slide 8: Market conditions and prices
Market conditions and prices OIL AND GAS PRICE UK POWER PRICE USD/bbl EUR/MWh EUR/MWh Oil price Gas TTF (rhs) 140 35 80 Forward prices Forward prices 120 30 70 100 25 60 80 20 50 60 15 40 2012 2013 2014 2012 2013 2014 Source: Platts, Argus Source: LEBA HYDRO BALANCE (TWh) GREEN DARK SPREAD (DK) AND
Slide 9: Financial highlights Q1 14
Selected financials (DKKm) Q1 14 Q1 13 2013 Financial highlights Q1 14 Revenue 20,192 23,232 73,105 EBITDA 6,334 4,627 15,004 Net financial items -722 -639 -3,800 EBITDA – DKK 6.3bn (up 37% y/y) Net profit 1,594 474 -993 Full impact from wind farms coming on stream during 2013 and high wind energy
Slide 10: Exploration & Production
Exploration & Production Oil & Gas production (mboe) Oil Gas 31.7 26.4 28.5 Operational highlights Q1 14 24.4 Gas production up 86% – primarily due to the redetermination of the Ormen Lange field 10.2 6.8 2.4 Slightly lower oil production (-8% y/y) largely due to 2.6 7.8 4.2 limited production f
Slide 11: Wind Power
Wind Power Renewable production (TWh) 6 Operational highlights Q1 14 4 +21% Full quarterly impact from Anholt and London Array 1.8 2 1.5 outnumbering lost production from divestments (Swedish hydro plant, Danish & Polish onshore wind) 0 Continued high availability (96% in Q1 14) and high 2010 20
Slide 12: Thermal Power
Thermal Power Thermal heat and power production (PJ, TWh) 60 20 Operational highlights Q1 14 15 40 Declining power and heat production 10 20 ‒ Declining power production (-41% y/y) and prices 5 due to mild and windy weather, increasing hydro 0 0 levels and rising contribution from wind production
Slide 13: Customers & Markets
Customers & Markets Operational highlights Q1 14 Operational figures Q1 14 Q1 13 Milder weather negatively impacting gas sales and Gas sales TWh 33.2 39.5 gas distribution Power sales TWh 9.2 4.1 Higher power sales y/y from increased wind power Distribution of gas TWh 2.9 3.9 production in the U
Slide 14: Debt overview
Debt overview Gross debt incl. hybrids Net debt (DKKbn) Key ratios loan portfolio1 Q1 14 2013 Duration 5.9 5.9 -75% 7% 3% Average time to maturity (years) 10.5 10.2 Bonds 25.8 1% Average interest rate 3.8% 3.7% 14% Hybrid Bank loans Note (1): The key ratios refer to the end of period position and ex
Slide 15: Outlook (unchanged)
Outlook (unchanged) EBITDA Around DKK 15-17bn in 2014 Net investments Around DKK 30bn in 2014-2015 FFO/Adjusted net debt Around 25% in 2014 Around 30% from 2015 and onwards Q1 2014 RESULTS 15
Slide 16: Q&A
DONG Q12014 RESULTS 16 energy
Slide 17: Appendix
APPENDIX Q1 2014 RESULTS 17
Slide 18: Financial targets
Financial targets EBITDA ROCE 2013 Target 2016 Target 2020 DKKbn 20 15 0.5% (6.8% Group >10% >12% excl. writedown) 2013 2016 E&P -3.1% (15%) 20% 20% Adjusted FFO/Net debt WP 4.6% (5.4%) 6-8% 12-14% % Around 30% 23% C&M 4.8% (4.8%) >8% >10% Target: Yearly operating CF of DKK 600-800m 2013 Target TP f
Slide 19: Outlook market prices
Outlook market prices Expectation Realised 2014 Q1 14 (average) Oil, Brent USD/bbl 104 108 Gas, TTF EUR/MWh 22 24 Gas, NBP EUR/MWh 22 25 Electricity, Nord Pool system EUR/MWh 27 30 Electricity, Nord Pool, DK1 EUR/MWh 33 29 Electricity, EEX EUR/MWh 33 34 Electricity, UK EUR/MWh 53 55 Coal, API 2 USD/
Slide 20: Investments
Investments Investments in Q1 14 Gross investments on Business Units in Q1 14 Cash flow from investing activities -8.1bn E&P DKK 1.0bn Purchase and sale of securities (reversal) 10.4bn Wind Power DKK 2.6bn Sale of assets and companies (reversal) -6.1bn Other DKK 0.2bn Gross investments -3.8bn
Slide 21: Calculation of FFO/Adjusted net debt
Calculation of FFO/Adjusted net debt Q1 14 LTM Q1 13 LTM 2013 EBITDA (Business Performance)1 16.7 12.6 15.0 Reversal of recognised lease payment 0.4 0.5 0.4 Adjusted net interest expenses 2 -2.9 -1.9 -2.8 Current tax -3.5 -3.7 -2.5 Funds From Operations (FFO) 10.8 7.6 10.0 Accounting net debt 6.4 34