Orsted · OMXCOP:ORSTED

Orsted — DONG Energy — Q1 2010 Earnings Presentation

25 slides from Orsted's earnings presentation, May 2010

  1. Slide 1: Financials 2010 – First quarter results

    FINANCIALS 2010 First quarter results

  2. Slide 2: Disclaimer

    Disclaimer Certain statements in this presentation are based on the beliefs of our management as well as assumptions made by and information currently available to the management. Forward-looking statements (other than statements of historical fact) regarding our future results of operations, financ

  3. Slide 3: Agenda

    Agenda  DONG Energy highlights  Financials  Outlook  Appendix 3

  4. Slide 4: Highlights first quarter 2010

    Highlights first quarter 2010 Key financials Key figures DKKbn  Increased earnings due to rising power prices 16 following the cold weather 13.6 14  Positive effect from timing differences 12 9.6 10.4 9.5  EBITDA up 64% y/y to DKK 4.3bn 10 9.0 8.8 8.8 8.2 8  Cash flow from operations increased 1

  5. Slide 5: Decision to develop Laggan-Tormore gas fields

    Decision to develop Laggan-Tormore gas fields Subsea Laggan Sullom Voe Developing the Laggan-Tormore fields production templates at Tormore Laggan &  Decision to develop in March 2010 Tormore Gas export pipeline  Part of strategy to secure long-term supply of oil and gas Gas processing f acility a

  6. Slide 6: Anholt offshore wind farm

    Anholt offshore wind farm Tender for Anholt offshore wind farm Facts about the Anholt offshore wind farm  In April 2010, DONG Energy submitted a binding tender  Anholt Offshore Wind Farm is to be erected near the to the Danish Energy Agency for the concession to build island of Anholt in Kattegat

  7. Slide 7: Unusual tight market situation in Q1

    Unusual tight market situation in Q1 10 Very cold first quarter in the Nordics Low hydro balance in the Nordics Degrees Celcius 20 25 10 20 Q1 10 15 0 10 -10 Actual 5 TWh Norm -20 0 -5 -30 -10 -40 -15 -50 Last 9 years range Median 2009 2010 -20 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan-200

  8. Slide 8: Higher Green Dark Spreads in Q1

    Higher Green Dark Spreads in Q1 10 Power prices in Denmark (monthly average) EUR/MWh 100 90 80 Green Dark Spread (monthly average) Forward prices 70 EUR/MWh 60 80 50 60 40 Forward prices 30 40 20 10 20 0 0 2007 2008 2009 2010 2011 DK1 (west) DK2 (east) EEX Nordpool (system) -20 Source: Nordpool, EEX

  9. Slide 9: Rising oil prices and continued low gas prices

    Rising oil prices and continued low gas prices Rising oil prices (Crude oil) Low gas prices (TTF) USD/bbl EUR/MWh 140 35 120 30 Forward price Forward price 100 25 80 20 60 15 40 10 20 5 0 0 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 Source: Platts Source: Argus Decoupling of oil and gas price

  10. Slide 10: Agenda

    Agenda  DONG Energy highlights  Financials and operating segments  Outlook  Appendix 10

  11. Slide 11: Selected Financial Figures

    Selected Financial Figures DKK million Q1 10 Q1 09  EBITDA increased by 64% y/y due to: Revenue 16,203 15,616  Positive effects from timing differences in connection EBITDA 4,343 2,653 with changing energy prices Profit after tax 2,013 718  Higher green dark spreads Assets 123,116 113,454  Incre

  12. Slide 12: Exploration & Production

    Exploration & Production Rising oil prices but continued low gas prices Operational Text box, Arial figures 16 bold Production highlights  Gas and oil production increased by 9% primarily due to Q1 10 Q1 09 the gas fields Ormen Lange and Alve Oil & gas production mboe 6.4 5.9  Gas production const

  13. Slide 13: Generation

    Generation Significantly higher power prices Operational figures Production highlights Q1 10 Q1 09  Thermal production was up 4% due to higher green dark spreads Power production GWh 6,436 5,824  Renewable production rose 59% from contribution from - Thermal GWh 5,399 5,173 new wind farms such as

  14. Slide 14: Energy Markets

    Energy Markets Less negative time lag effects Operational figures Production highlights  Gas sales increased 28% Q1 10 Q1 09  Cold weather and low gas prices caused increased gas Gas sales GWh 43,515 34,055 sales in Denmark including sales to own power plants Power sales GWh 2,868 2,970  Higher g

  15. Slide 15: Sales & Distribution

    Sales & Distribution Stable earnings Operational figures Production highlights Q1 10 Q1 09  Gas sales and distribution were up 26% and 9%, respectively, primarily due to the cold weather Gas sales GWh 9,594 7,598  Power sales down 5%, while power distribution Distribution of gas GWh 4,277 3,934 in

  16. Slide 16: Investments

    Investments Investment in Q1 10 Investment plans  DONG Energy's share of net investments is still Cash flow from investment activities -0.0bn expected to be (including disposals): Sale of securities (add back) -2.5bn  2010: Around DKK 10bn  2011: DKK 10-15bn Minorities' share of investments (add

  17. Slide 17: Debt overview

    Debt overview Gross interest-bearing debt (incl. hybrid capital) Key ratios gross loan portfolio (incl. hybrid capital) DKKbn 45 0.7 Q1 101 Q1 09 40 8.1 Share of fixed rate 94% 86% 35 0.2 Other Duration (years) 6.1 4.4 30 1.3 11.3 Mortgage loans Average time to maturity (years) 8.0 5.2 25 8.1 Averag

  18. Slide 18: Liquidity overview

    Liquidity overview Liquidity reserves – Figures Liquidity reserves – Policy  Target is to maintain a liquidity reserve of at least EUR Committed facilities (DKKbn) Q1 10 Q1 09 1.5bn EUR 1.5bn RCF, due 2011 11.2 11.2 (fully undrawn)  This has historically been achieved through the Other undrawn com

  19. Slide 19: Agenda

    Agenda  DONG Energy highlights  Financials and operating segments  Outlook  Appendix 19

  20. Slide 20: Outlook for 2010 – Commodity prices

    Outlook for 2010 – Commodity prices  Q1 10 is in line with expectations as at the time of the outlook in the Q1 update annual report 2009 – the cold weather was included in the original outlook  Expectations for the full year 2010 are unchanged  Oil and natural gas exposure for 2010 is largely ne

  21. Slide 21: Outlook for 2010 – Earnings, investments & capital structure

    Outlook for 2010 – Earnings, investments & capital structure  New assets and Ormen Lange expected to contribute a further DKK 1.0bn in 2010  Due to higher energy prices, timing differences are expected to be neutral to positive compared to negative in 2009 resulting in:  A somewhat better EBITDA

  22. Slide 22: Q&A

    Q&A FOR FURTHER INFORMATION PLEASE VISIT OUR WEBSITE dongenergy.com/EN/Investor/ 22

  23. Slide 23: Agenda

    Agenda  DONG Energy highlights  Financials and operating segments  Outlook  Appendix 23

  24. Slide 24: Capital structure, Dividend, Funding and Rating

    Capital structure, Dividend, Funding and Rating Long term capital structure target Funding strategy and Debt Programmes  Maintain a minimum rating of BBB+ / Baa1  External funding primarily to be carried out  Adjusted net interest-bearing debt (1) of around through parent company – to avoid struc

  25. Slide 25: Net debt calculation Q1 10

    Net debt calculation Q1 10 DKKbn 40 34.5 35 4.0 29.5 30 (5.6) (1.4) 25.4 25 (0.6) (1.2) (0.4) 20 15 10 5 0 25

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