Genesis Energy Limited · NZX:GNE
Genesis Energy — Debt Investor Presentation (May 2022)
34 slides from Genesis Energy's debt investor presentation, May 2022
Slide 1: Genesis Energy Limited Green Capital Bond Offer
Genesis Energy Limited Green Capital Bond Offer May 2022
Slide 2: Important Information Disclaimer
Important Information Disclaimer The information in this Presentation is given in good should carefully consider the features of the The offer (Offer) of unsecured, material information to NZX Limited (NZX) faith and has been obtained from sources believed to Capital Bonds, which differ from the fea
Slide 3: Agenda
Agenda 1. Green Capital Bond Highlights 2. About Genesis 3. Strategic Outlook 4. Sustainable Finance Framework 5. Financial Performance 6. Key Terms and Dates
Slide 4: Green Capital Bond Highlights
Green Capital Bond Highlights
Slide 5: Offer Highlights
Offer Highlights Issuer Genesis Energy Limited. Description The Capital Bonds are unsecured, subordinated, interest bearing debt securities. The Capital Bonds will be designated as green bonds in accordance with Genesis' Sustainable Finance Framework dated November 2021 (as amended from time to time
Slide 6: About Genesis
About Genesis
Slide 7: Genesis Overview
Genesis Overview 2 KEY INFORMATION Revenue (FY21): $3.2 billion 953 ∼470,000 EBITDAF Guidance (FY22): $430-440 million customers PPA Market Capitalisation: $2.8 billion1 • 22% electricity market share 133 Enterprise Value: $4.4 billion3 138 • 34% gas market share Credit Rating (S&P Global Ratings):
Slide 8: HY Performance Highlights
HY 22 Performance Highlights Financial Operational Social EBITDAF 1 Strong Customer Loyalty Ngā Ara Creating $210m +26 13.2% Pathways Facilitating transformational education, NPAT $85 million Brand NPS Net Churn training and employment opportunities to prepare rangatahi for the future of work. Inter
Slide 9: Strategic Outlook
Strategic Outlook
Slide 10: An active enabler of New Zealand's energy transition
An active enabler of New Zealand’s energy transition Future-gen – transitioning our wholesale position to lead NZ’s energy transition Value from flexibility Grow renewables Transition Huntly and reliability Contract for Contract for Trial biofuels new renewable fuel flexibility as a fuel option gene
Slide 11: Future-gen programme targets to deliver lower cost renewables
Future-gen programme targets to deliver lower cost renewables • Future-gen has already displaced an estimated 330,000 GENESIS GENERATION DIVERSITY tonnes of carbon emissions through the Waipipi windfarm. Ownership Joint Venture PPA • Waipipi is now generating 455GWh per annum. Hydro NI/SI • Kaiwaika
Slide 12: Biofuel at Huntly could provide a seasonal storage solution
Biofuel at Huntly could provide a seasonal storage solution but not short notice peaking capacity WORK COMPLETED TO DATE PAINTS A POSITIVE PICTURE FOR ADVANCED BIOFUELS EXPECTED TO BE COMPETITIVE WITH COAL BIOMASS AT HUNTLY AT CURRENT CARBON PRICES (PRIOR TO FREIGHT) $300 Biofuels resource assessmen
Slide 13: Varied scenarios trend towards 96% to 98% renewable by 2030
Varied scenarios trend towards 96% to 98% renewable by 2030 Balanced Regulated Renewables Pressure cooker Oversupply Demand growth from EV An incentivised renewable Faster than anticipated Tiwai closure causes and industrials are evenly uptake with a goal of 100% demand growth with oversupply of low
Slide 14: A highly renewable market will require peaking capacity and seasonal storage
A highly renewable market will require peaking capacity and seasonal storage - market settings may need to adapt Near 100% renewable, spill makes further renewable build a A highly renewable1 grid draws on backup generation to cover costly way to displace remaining thermal infrequent peak capacity n
Slide 15: Genesis is evaluating its further long-term carbon reduction ambitions
Genesis is evaluating its further long-term carbon reduction ambitions • Genesis has committed to a 1.5 degree SCOPE 1 EMISSIONS - GENERATION INTENSITY (MEAN YEAR) Science-Based Target1 by 2025, which will reduce emissions by at least 1.2 million tonnes by FY252. • Our Future-gen strategy aims to re
Slide 16: Regulatory environment creates an opportunity to shape a low carbon energy system
Regulatory environment creates an opportunity for business, Government and regulators to collectively shape a low carbon energy system MfE Emissions Reductions Plan MBIE: NZ battery project • Delivered in 2022 determining the policy plans to meet • Work programme identifying renewable options to Pot
Slide 17: Sustainable Finance Framework
Sustainable Finance Framework
Slide 18: Overview of the Sustainable Finance Framework
Overview of the Sustainable Finance Framework Established by Genesis in November 2021 • Genesis’ Sustainable Finance Framework (Sustainable Finance Framework) sets out the process by which Genesis intends to issue and manage bonds and loans (Sustainable Debt) on an ongoing basis to support Genesis’
Slide 19: 36% of facilities linked to sustainable assets and outcomes
36%1 of facilities linked to sustainable assets and outcomes First NZ company to have a Framework, loan and bond aligned to the Climate Transition Finance Handbook DECEMBER 2020 NOVEMBER/ JANUARY 2022 MARCH 2022 DECEMBER 2021 Sustainable Finance Genesis commits to an ambitious Framework Released $22
Slide 20: Pillars of the Sustainable Finance Framework
Pillars of the Sustainable Finance Framework Management & Governance Use of In accordance with Genesis’ Sustainable Finance Framework, Genesis intends to notionally allocate an amount equal to the proceeds of its green bonds and green loans to finance or refinance renewable energy assets, or other p
Slide 21: Eligible Asset Register
Eligible Asset Register Hydroelectricity Asset Value $m Green Debt Instrument Green Debt Value ($m) (30 June 2021) GNE060 125 Rangipo GNE070 (proposed 2251 Tokaanu refinancing- excluding 1,364 Mangaio GNE040) Total Green Debt2 350 Tuai Piripaua Total Value ($m) 486 Kaitawa Total Eligible Assets Valu
Slide 22: External Review
External Review Pre Issuance Genesis obtained Pre-Issuance verification from DNV Business Assurance Australia Pty Ltd (DNV) that concludes, in DNV’s Verification opinion, the Sustainable Finance Framework and Eligible Asset Register are aligned with the Green Bond Principles and the Climate Transiti
Slide 23: Financial Performance
Financial Performance
Slide 24: HY22 Financial Summary
HY22 Financial Summary KEY FINANCIAL COMPARISONS1 $ millions - 2.6% + 62.9% + 1.0% + 97.4% + 8.0% - 49.5% - 3.4% - 15.4% + 1.2% + 4.5% 1 Due to the Implementation of IFRIC agenda decision on Configuration and Customisation costs incurred in implementing Software-as-a-Service, HY21 and FY21 comparabl
Slide 25: Capital invested for efficiency and long term resilience
Capital invested for efficiency and long term resilience CAPITAL EXPENDITURE1 HY22 stay in business capital expenditure 2 of $25.5m includes: $ MILLIONS Long term investment to improve the reliability and efficiency of generation assets. This included: • $1.5m invested in the ongoing Tekapo B runner
Slide 26: Capital structure and debt profile
Capital structure and debt profile GENESIS DEBT PROFILE AT 30 APRIL 2022 NET DEBT/EBITDAF RATIO FALLING TO TARGET BAND $m $350 $300 $250 $200 $150 $100 $50 $0 • S&P reaffirmed BBB+ Issuer Credit Rating in February 2022. FY22 Q4 FY23 FY24 FY25 FY26 FY27 FY28 FY29 FY47 FY49 Q4 Commercial Paper Wholesa
Slide 27: Key Terms and Dates
Key Terms and Dates
Slide 28: Key Terms
Key Terms Description The Capital Bonds are unsecured, subordinated, interest bearing debt securities. The Capital Bonds will be designated as green bonds in accordance with Genesis' Sustainable Finance Framework dated November 2021 (as amended from time to time) (Sustainable Finance Framework). Off
Slide 29: Interest Payments
Interest Payments Interest Rate The Interest Rate applying from (and including) the Issue Date to (but excluding) the first Reset Date will be the percentage rate per annum equal to the Benchmark Rate (mid- market NZD swap rate for a 5-year term, as determined on the Rate Set Date) plus the Margin (
Slide 30: Early Redemption
Early Redemption Mandatory Redemption Genesis must redeem all the Capital Bonds on the Maturity Date or if an Event of Default occurs. Optional Early Redemption by Genesis Genesis has the right to redeem: a) all or some of the Capital Bonds on any Reset Date; b) all or some of the Capital Bonds on a
Slide 31: Key Early Redemption Drivers
Key Early Redemption Drivers Year 5 – Reset Date (9 June 2027) • Potential Election Process or Genesis can call (redeem) the Capital Bonds • Step-up in margin (0.25%) if not called or no Successful Election Process • Potential refinancing risk at year 10 if not called • Call is at par (any subsequen
Slide 32: Offer Structure Key Dates
Offer Structure Key Dates Offer Structure • Bookbuild process Opening Date Thursday, 26 May 2022 o All of the Capital Bonds (including oversubscriptions) are reserved for subscription by clients of the Joint Lead Managers, institutional investors and certain other parties. Closing Date 11.00am, Wedn
Slide 33: Non-GAAP Measures
Non-GAAP Measures EBITDAF (Earnings before net finance expense, income tax, depreciation, depletion, amortisation, impairment, fair value changes, and other gains and losses) is a non GAAP (generally accepted accounting practice) financial measure. It is commonly used within the electricity industry
Slide 34: Green Capital Bond enquiries
Green Capital Bond enquiries Dan Dillane Group Treasurer +64 21 501 235
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