Slide 1: 2013 Full Year Results
2013 FULL YEAR RESULTS 1 AUGUST 2013
Slide 2: Disclaimer and Basis of Preparation
DISCLAIMER AND 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
Slide 3: Year in Review
YEAR IN REVIEW SCOTT CHARLTON, CHIEF EXECUTIVE OFFICER
Slide 4: FY13 Highlights
FY13 HIGHLIGHTS FINANCIAL PORTFOLIO DISTRIBUTION GROWTH MANAGEMENT GROWTH DRIVERS • Solid traffic growth across • Growth in free cash supporting • Major Sydney network Australian assets continued distribution growth enhancements progressively - 5.0% proportional toll - FY13 distributions of deliveri
Slide 5: FY13 Highlights: Distribution Growth
FY13 HIGHLIGHTS DISTRIBUTION GROWTH • FY14 distribution guidance of 34 cents ⎯ Expectation of 7 cent fully franked dividend component ⎯ Expected to be 100% free cash covered • FY13 distribution of 31 cents ⎯ Includes 7 cent fully franked dividend component COMPOUND ANNUAL GROWTH OF 9.1% OVER 5 YEARS
Slide 6: FY13 Highlights: Operational
FY13 HIGHLIGHTS OPERATIONAL OPERATIONS DEVELOPMENT CORPORATE • Full electronic tolling • Partnering with government for • Capabilities enhanced at implemented on M5 motorway further network enhancements Executive level – aligned to • Further consolidation of ⎯ Stage 3 negotiations with strategy oper
Slide 7: FY13 Highlights: Safety Initiatives
FY13 HIGHLIGHTS SAFETY INITIATIVES CUSTOMER SAFETY IMPROVEMENTS NSW • Traffic management system improvements being implemented on various assets • Campaign to encourage motorists to stay in vehicle during breakdowns/incident VICTORIA • Working with VicRoads on improvements to Western Link / West Gat
Slide 8: FY13 Highlights: Portfolio Performance
FY13 HIGHLIGHTS PORTFOLIO PERFORMANCE % OF PROPORTIONAL TRAFFIC TOLL REVENUE EBITDA ASSET TOLL REVENUE GROWTH (%) GROWTH (%) GROWTH (%) 50.0 CITYLINK 2.4 6.51 8.81 14.5 HILLS M2 1.4 1.5 3.1 6.2 LANE COVE TUNNEL 1.8 2.6 4.0 7.6 M1 EASTERN DISTRIBUTOR 0.1 8.5 9.6 10.6 WESTLINK M7 3.4 4.4 7.8 9.5 M5 SO
Slide 9: FY13 Highlights: Portfolio Development
FY13 HIGHLIGHTS PORTFOLIO DEVELOPMENT Figures for prior years reflect proportional toll revenue, excluding the M4. Diagrammatic depiction only. 9
Slide 10: Financial Results
FINANCIAL RESULTS SAMANTHA HOGG, CHIEF FINANCIAL OFFICER
Slide 11: Statutory Results Summary
STATUTORY RESULTS SUMMARY 2013 2012 An equity accounting NET PROFIT $174.5 million $58.6 million + 198.1% charge of $138.1 million was made in Transurban’s statutory accounts for the TOLL REVENUE $801.2 million $765.4 million + 4.7% year ended 30 June 2012, relating to a reduction in the carrying va
Slide 12: Statutory Results: Income Statement
STATUTORY RESULTS INCOME STATEMENT YEAR ENDED 30 JUNE 2013 30 JUNE 13 ($M) 30 JUNE 12 ($M) % CHANGE Toll revenue 801.2 765.4 4.7% Fee and other revenue 85.5 80.8 5.8% Construction revenue 265.8 286.3 (7.2%) Business development & other revenue 42.6 22.0 93.6% Total revenue 1,195.1 1,154.5 3.5% Opera
Slide 13: Proportional Results Summary
PROPORTIONAL RESULTS SUMMARY 2013 2012 TOLL REVENUE $991.4 million $943.9 million + 5.0% Key elements: • I-95 success fee $8.6 million FEE REVENUE $75.8 million $68.3 million + 11.0% • TTMS revenue for Express Lanes tolling systems TTMS & OTHER REVENUE $58.3 million $35.0 million + 66.6% development
Slide 14: Proportional Results
PROPORTIONAL RESULTS YEAR ENDED 30 JUNE 2013 30 JUNE 13 ($M) 30 JUNE 12 ($M) % CHANGE Toll revenue 991.4 943.9 5.0% Fee revenue 75.8 68.3 11.0% Other revenue 58.3 35.0 66.6% Total revenue 1,125.5 1,047.2 7.5% Operating costs (233.8) (220.0) (6.3%) Business development costs (18.9) (14.6) (29.5%) Cor
Slide 15: Direct Costs
DIRECT COSTS COMPONENTS OF INCREASE OTHER COSTS INCLUDE: OTHER INCREASES IN DIRECT COSTS • M4 service centre costs $6.1M • Volume-related costs • O&M cost increases (including electricity) Excluding one-off costs • Employee costs and costs associated Offset by call centre cost savings with new opera
Slide 16: Free Cash Flow
FREE CASH FLOW FREE CASH FLOW 30 JUNE 13 ($M) 30 JUNE 12 ($M) % CHANGE FREE CASH: First half 192.8 184.2 4.6% Second half 250.5 249.2 0.5% Total 443.3 433.4 2.3% Underlying free cash per security (cents) – weighted average securities 30.1 29.8 1.0% on issue at year end • FY13 distribution of 31 cent
Slide 17: Diversified Funding
DIVERSIFIED FUNDING TREASURY SNAPSHOT DEBT FUNDING SOURCES ACROSS THE GROUP GOVERNMENT DEBT 8% CAPITAL MARKETS DEBT 46% BANK DEBT 46% Shows A$ equivalent value of proportional-drawn debt. Foreign currency debt is Chart shows A$ equivalent value of debt, and includes 100% of asset debt. 95 Express La
Slide 18: Funding Snapshot
FUNDING SNAPSHOT AUSTRALIAN BORROWING ENVIRONMENT 18
Slide 19: Market Update
MARKET UPDATE SCOTT CHARLTON, CHIEF EXECUTIVE OFFICER
Slide 20: Victoria: Network Development
VICTORIA NETWORK DEVELOPMENT Future opportunities for CityLink enhancements • Focus on Western Link congestion points and interrelationship with proposed East-West project • Working with VicRoads on improvements to Western Link / West Gate freeway interchange congestion points East-West Link • Victo
Slide 21: Victoria: Customer Operations
VICTORIA CUSTOMER OPERATIONS Efficiencies in back office Supporting volume growth across GLIDE TOLLING 1 Improved mobile 2 processes – reduced 3 Transurban network: >284 million SYSTEM and web channels average handling times transactions processed on BENEFITS for customers and call volumes CityLink
Slide 22: NSW Market: Network Development
NSW MARKET NETWORK DEVELOPMENT • Northwest corridor positioned for growth following M2 Upgrade completion - June quarter traffic – positive trend on M2, M7 and LCT • Southwest corridor to benefit from M5 West Widening completion in late calendar 2014 • Financial close on F3-M2 targeted for late cale
Slide 23: Hills M2 Upgrade
HILLS M2 UPGRADE SUCCESSFUL COMPLETION COMPLETION AUGUST 2013 VALUE SOURCES 8% 18kms INDICATIVE PRICE RISE AT ALL TOLL OF ADDITIONAL CONCESSION POINTS AT PROJECT NEW LANE CAPACITY EXTENSION TRAFFIC COMPLETION1 UPLIFT 22% MAIN TOLL PLAZA PRICE $1.2 NPV - ECONOMIC WORTH Bn TOLL INCREASE NEW RAMPS INCR
Slide 24: M5 West Widening
M5 WEST WIDENING CONSTRUCTION PROGRESS ON SCHEDULE FOR COMPLETION LATE CALENDAR 2014 VALUE SOURCES 40 PROJECT COMPLETE1 % PURSUING OPTION TO OPEN THIRD LANE IN STAGES AS EACH SECTION IS COMPLETED TRAFFIC DISRUPTION IN LINE WITH EXPECTATIONS – ADT DOWN 1.6% IN JUNE QUARTER INDICATIVE TRAFFIC UPLIFT C
Slide 25: F3-M2 Proposal
F3-M2 PROPOSAL LEVERAGING NETWORKS STAGE 3 1 VALUE SOURCES INDICATIVE • Targeting financial close by late calendar 2014 • Procurement of Design and Construction contract under way GOVERNMENT CONTRIBUTION F3-M2 - D&C price targeted at less than $2.65bn TOLLS - 5 high-calibre responses to EOI • Value
Slide 26: USA: Network Development
USA NETWORK DEVELOPMENT Focus on existing Express Lanes projects • Continue integration of Express Lanes into Northern Virginia region - Enhance value for customers - Educate and equip prospective users Changes to Transurban USA business footprint • Transfer of Pocahontas 895 to lenders under way •
Slide 27: 495 Express Lanes: Customer Awareness
495 EXPRESS LANES CUSTOMER AWARENESS Value drivers for customers • Speed limit increase from 55mph to 65mph • VDOT funded 2-mile extension of the merge area of the northern terminus – anticipated completion late 2014 • Traffic signal improvement Educate & equip prospective customers • More than 105,
Slide 28: Express Lanes: Emerging Profile
495 EXPRESS LANES EMERGING PROFILE • Traffic and revenue remains below project case expectations • June quarter average daily revenue of US$45,270 compared to US$27,499 in March quarter - Record daily toll revenue of US$78,155 on 28/6/2013 • Weekday average toll of $1.95 in June quarter represents 6
Slide 29: 95 Express Lanes: Construction Progress
95 EXPRESS LANES CONSTRUCTION PROGRESS ON SCHEDULE FOR COMPLETION LATE CALENDAR 2014 Construction of bridges, 40% PROJECT COMPLETE1 earth moving & paving under way across full length of project +1m WORK HOURS WITHOUT A LOST TIME INCIDENT 1. Time measured against scheduled completion date. 29
Slide 30: Conclusion
CONCLUSION PORTFOLIO FREE CASH NEW PERFORMANCE GROWTH OPPORTUNITIES • Financial performance • M2 upgrade project • F3-M2 project in Stage 3 remains strong complete and delivering negotiations - 5.0% proportional toll revenue • Major projects progressing • Future opportunities for growth well CityLin
Slide 31: Appendix 1: Detailed Financials
APPENDIX 1 DETAILED FINANCIALS
Slide 32: Reconciliation: Statutory to Proportional EBITDA
RECONCILIATION STATUTORY EBITDA TO PROPORTIONAL EBITDA 30 JUNE 13 ($M) 30 JUNE 12 ($M) % CHANGE Statutory EBITDA 676.2 636.9 6.2% Less: EBITDA attributable to Non-controlling interest (17.8) (16.9) (5.3%) Add: M5 South West Motorway proportional EBITDA 87.8 82.3 6.7% Add: Westlink M7 proportional EB
Slide 33: Statutory Income Statement to EBITDA – June 2013
RECONCILIATION STATUTORY INCOME STATEMENT TO EBITDA – 30 JUNE 2013 $ MILLIONS OFFSET CONSTRUCTION OTHER REVENUE NET BUSINESS ACCOUNTING DISCLOSURE REALLOCATION OF STATUTORY P&L REALLOCATION DEVELOPMENT UNDER AASB I 12 CAPITALISED COSTS TOTAL Toll revenue 801.2 801.2 Fee & other road revenue 85.5 (0.
Slide 34: Result by Asset – Consolidated Assets June 2013
RESULT BY ASSET – 100% CONSOLIDATED ASSETS – 30 JUNE 2013 $ MILLIONS CITYLINK HILLS M2 LANE COVE TUNNEL TOLLAUST M1 ED ROAM OTHER TOTAL Toll revenue 495.8 143.3 61.5 – 100.5 – – 801.2 Fee & other revenue 46.4 5.0 2.0 9.3 0.6 16.4 44.9 124.5 Total revenue 542.2 148.3 63.5 9.3 101.1 16.4 44.9 925.7 To
Slide 35: Result by Asset – Equity Assets June 2013
RESULT BY ASSET – 100% EQUITY ASSETS – 30 JUNE 2013 $ MILLIONS M5 SOUTH WEST POCAHONTAS 495 EXPRESS MOTORWAY WESTLINK M7 895 LANES DRIVE TOTAL Toll revenue 188.8 209.4 15.1 7.2 – 420.5 Fee & other revenue 12.8 3.7 0.1 1.9 – 18.5 Total revenue 201.6 213.1 15.2 9.1 – 439.0 Total cost (25.9) (43.5) (6.
Slide 36: Statutory Income Statement to EBITDA – June 2012
RECONCILIATION STATUTORY INCOME STATEMENT TO EBITDA – 30 JUNE 2012 $ MILLIONS OTHER REVENUE NET BUSINESS OFFSET CONSTRUTION ACCOUNTING REALLOCATION OF STATUTORY P&L REALLOCATION DEVELOPMENT DISCLOSURE UNDER AASB 1 12 CAPITALISED COSTS TOTAL Toll revenue 765.4 765.4 Fee & other road revenue 80.8 17.2
Slide 37: Result by Asset – Consolidated Assets June 2012
RESULT BY ASSET – 100% CONSOLIDATED ASSETS – 30 JUNE 2012 CITYLINK HILLS M2 LANE COVE TUNNEL TOLL AUST M1 ED ROAM OTHER TOTAL Toll revenue 471.6 141.2 60.0 – 92.6 – – 765.4 Fees and other revenue 44.8 3.3 1.6 7.5 0.3 16.0 24.5 98.0 Total revenue 516.4 144.5 61.6 7.5 92.9 16.0 24.5 863.4 Total cost (
Slide 38: Result by Asset – Equity Assets June 2012
RESULT BY ASSET – 100% EQUITY ASSETS – 30 JUNE 2012 $ MILLIONS M5 SOUTH WEST 495 EXPRESS WESTLINK M7 POCAHONTAS 895 DRIVE TOTAL MOTORWAY LANES Toll revenue 181.1 200.5 14.4 – – 396.0 Fee and other revenue 11.6 2.6 0.1 – – 14.3 Total revenue 192.7 203.1 14.5 – – 410.3 Total cost (28.1) (45.8) (5.2) –
Slide 39: Free Cash Flow
FREE CASH FLOW 30 JUNE 13 ($M) 30 JUNE 12 ($M) % CHANGE Cash flows from operating activities (refer Group statutory accounts) 411.3 373.2 10.2% Adjusted for: M7 Term Loan Notes interest received (46.4) (30.9) (50.2%) Payments for maintenance capital expenditure 9.6 27.7 (65.3%) Cashflows from operat
Slide 40: Reconciliation of Free Cash
RECONCILIATION OF FREE CASH 30 JUNE 13 ($M) 30 JUNE 12 ($M) % CHANGE Underlying proportional EBITDA 828.0 784.0 5.6% Adjusted for proportional: Maintenance provision 27.3 24.9 9.6% Operating and working capital movements (3.7) (22.3) 83.4% Non-cash items (1.9) 2.3 (182.6%) Net interest paid (373.8)
Slide 41: Taxation
TAXATION STATUTORY AND PROPORTIONAL STATUTORY TAX PAID / (REFUNDS RECEIVED) INCLUDES 30 JUNE 13 ($M) 30 JUNE 12 ($M) M1 Eastern Distributor 7.2 44.8 M4 (0.1) 0.4 Transurban USA – 0.5 Westlink M7 holding companies 5.1 1.9 Corporate – (1.7) TOTAL 12.2 45.9 PROPORTIONAL TAX PAID / (REFUNDS RECEIVED) IN
Slide 42: Maintenance Expense
MAINTENANCE EXPENSE INCLUDED IN OPERATING COSTS ADDITIONAL MAINTENANCE PROVISION RECOGNISED DURING THE YEAR – 100% 30 JUNE 13 ($M) 30 JUNE 12 ($M) CityLink 7.6 8.3 Hills M2 2.3 2.2 Lane Cove Tunnel 4.7 4.1 M1 Eastern Distributor 7.3 4.4 M5 South West Motorway 0.2 3.6 Westlink M7 6.5 8.7 Pocahontas 8
Slide 43: Finance Costs – June 2013
FINANCE COSTS NET FINANCE COSTS PAID 30 JUNE 2013 NON-CASH ITEMS STATUTORY DEBT FEES CONCESSION AND ACCRETION, OTHER NON- NET INTEREST PROPORTIONAL OWNERSHIP NET INTEREST AMORTISATION MAINTENANCE UNWIND TIFIA, TLN & USPP CASH ITEMS PAID NET INTEREST PAID Controlled entities CityLink 100.0% (57.3) 7.
Slide 44: Finance Costs – June 2012
FINANCE COSTS NET FINANCE COSTS PAID – 30 JUNE 2012 NON-CASH ITEMS OWNERSHIP STATUTORY NET DEBT FEES CONCESSION & ACCRETION, OTHER NET INTEREST PROPORTIONAL NET INTEREST AMORTISATION MAINTENANCE TIFIA, TLN & USP NON-CASH PAID INTEREST PAID UNWIND ITEMS Controlled entities CityLink 100.0% (66.3) 2.1
Slide 45: Appendix 2: Detailed Treasury & Funding
APPENDIX 2 DETAILED TREASURY & FUNDING
Slide 46: Group Drawn Debt at 30 June 2013
GROUP DRAWN DEBT AT 30 JUNE 2013 TRANSURBAN CORPORATE AUD ($ MILLION) USD ($ MILLION) DEBT Working capital lines1 – 266 Term bank debt 600 – US Private Placements 1,336 162 Domestic AUD bonds 1,050 – Canadian MTN (CAD Notes) 233 – TOTAL 3,219 428 NON RECOURSE (AUD $ MILLION) ASSET DEBT OWNERSHIP PRO
Slide 47: Total Group Drawn Debt
TOTAL GROUP DRAWN DEBT PROPORTIONAL DRAWN DEBT GROUP DEBT 30 JUNE 2013 30 JUNE 2012 MOVEMENT1 EXPLANATION AUD2 Corporate 3,219 3,219 – Non recourse 2,308 2,189 119 $89m increase in M2 Hills drawn debt for the upgrade project. $28m increase in M5 drawn debt for widening project. $2.5m increase in Wes
Slide 48: Key Debt Metrics
KEY DEBT METRICS 30 JUNE 2013 30 JUNE 2012 TRANSURBAN TRANSURBAN GROUP CORPORATE NON RECOURSE GROUP CORPORATE NON RECOURSE Weighted average maturity (years)1 9.7 yrs 3.9 yrs 13.6 yrs 9.6 yrs 5.1 yrs 12.8 yrs Weighted average cost of AUD debt2 6.6% 6.5% 6.7% 6.9% 6.9% 7.0% Weighted average cost of US
Slide 49: Corporate Debt Maturities
CORPORATE DEBT MATURITIES BY FINANCIAL YEAR 1. Debt is shown in financial year it matures. 2. Debt values are as at 30 June 2013. C$ and US$ debt converted at the hedged rate where cross currency swaps are in place. Unhedged US$ debt converted to A$ at spot exchange rate ($0.9275 at 30 June 2013) at
Slide 50: Asset Debt Maturities
ASSET DEBT MATURITIES BY FINANCIAL YEAR 1. The full value of debt facilities is shown as this is the value of debt for refinancing purposes. This overstates Transurban’s ownership share of the debt. 3. US$ debt is converted to A$ at spot exchange rate ($0.9275 at 30 June 2013). 2. Debt is shown in t
Slide 51: Appendix 3: Portfolio Summary
APPENDIX 3 PORTFOLIO SUMMARY
Slide 52: Asset Snapshot
ASSET SNAPSHOT TOLL TOLL TOLL PERCENTAGE OF TRAFFIC TRAFFIC TRAFFIC REVENUE REVENUE REVENUE EBITDA EBITDA EBIDTA PROPORTIONAL GROWTH GROWTH GROWTH GROWTH GROWTH GROWTH GROWTH GROWTH GROWTH TOLL REVENUE 1H (%) 2H (%) FY (%) 1H (%) 2H (%) FY (%) 1H (%) 2H (%) FY (%) 50.0% CityLink 2.0% 2.9% 2.4% 5.4%
Slide 53: Operating Asset Portfolio
OPERATING ASSET PORTFOLIO SUMMARY STATISTICS M5 SOUTH WEST M1 EASTERN LANE COVE 495 EXPRESS MOTORWAY HILLS M2 DISTRIBUTOR WESTLINK M7 TUNNEL CITYLINK POCAHONTAS 895 LANES OVERVIEW NSW NSW NSW NSW NSW VIC VIRGINIA, USA VIRGINIA, USA Opening date Aug 1992 May 1997 Dec 1999 Dec 2005 Mar 2007 Dec 2000 J
Slide 54: Tolling Escalation
TOLLING ESCALATION EMBEDDED INFLATION PROTECTION MOTORWAY ESCALATION1 M5 South West Motorway Escalated quarterly by quarterly CPI. The toll cannot be lowered as a result of deflation, however, until inflation counteracts the deflation the toll cannot be increased. Hills M2 Escalated quarterly by the