Slide 1: ASX Release cover letter: 2010 Full Year Results Presentation
For personal use only ASX RELEASE 25 August 2010 The Manager Company Announcements Office Australian Securities Exchange 4th Floor, 20 Bridge Street Sydney NSW 2000 Electronic Lodgement Dear Sir or Madam Company Announcement I attach the following announcement for release to the market: • 2010 Full
Slide 2: Financial Results Year ended 30 June 2010
For personal use only Financial Results Year ended 30 June 2010 25 August 2010
Slide 3: Result overview and strategic highlights
For personal use only Result overview and strategic highlights Mick McCormack Managing Director and CEO 2010 Result Presentation Æ 2
Slide 4: Another strong result
Another strong result For personal use only 2010 2009 $ million $ million Change Operating cash flow 268 234 up 15% Operating cash flow per security (cents) 51.9 48.2 up 8% Distribution per security (cents) 32.75 31.0 up 6% Distribution payout ratio 64.4% 65.6% Revenue excluding pass‐through 660 673
Slide 5: Ten years of delivering value and growth
Ten years of delivering value and growth For personal use only 500 APA total securityholder return All Ordinaries accumulation index Value today of $1 invested in June 2000 400 APA investment $ 4.23 300 Investment indexed $ 2.08 to the All Ords 200 Interest account * $ 1.69 100 Cash $ 1.00 0 * Cash
Slide 6: Delivering sustainable, profitable growth
Delivering sustainable, profitable growth For personal use only Gas infrastructure assets well positioned in the Australian market – Pipelines across Australia transporting more than half the nation’s gas use – Secure and reliable cash flow – regulated and contracted revenue People with the skil
Slide 7: Strategic and operational highlights: enhancing gas infrastructure portfolio
Strategic and operational highlights For personal use only Enhancing our gas infrastructure portfolio Hastings Diversified Utiltites Fund Acquired 17% interest Commenced or continued Berwyndale Wallumbilla Pipeline more than $200 million of Acquired with long term GTA organic growth projects Roma
Slide 8: Young to Wagga lateral expansion
Young to Wagga lateral expansion For personal use only Grading Trenching Pipeline stringing Welding Pipeline prepared for lowering 2010 Result Presentation Æ 7
Slide 9: Utilising our skills and industry knowledge
Strategic and operational highlights For personal use only Utilising our skills and industry knowledge Energy infrastructure management expertise applied across our investments, in particular for Energy Infrastructure Investments and EII2 (North Brown Hill wind farm interest) Capturing revenue and
Slide 10: Leveraging our infrastructure portfolio
Strategic and operational highlights For personal use only Leveraging our infrastructure portfolio Facilitating development of gas‐fired power generation Strengthening our financial capability Refinanced $1 billion debt Obtained a Baa2 credit rating from Moody’s to sit alongside the BBB from S
Slide 11: Sustainability reporting
Sustainability reporting For personal use only APA’s first sustainability report – Achievements and goals across all stakeholder groups: customers, employees, investors, community and environment Safety remains paramount – Long‐term safety goal of Zero Harm ‐ program of continuous improvement –
Slide 12: Financial performance
For personal use only Financial performance Peter Fredricson Chief Financial Officer 2010 Result Presentation Æ 11
Slide 13: Strong and consistent result
Strong and consistent result For personal use only 2010 2009 Change $ million $ million Total revenue excluding pass‐through1 659.5 673.0 (2.0%) Total revenue 989.5 944.4 4.8 % EBITDA 460.0 444.4 3.5 % EBIT 368.5 348.7 5.7 % Net interest expense (229.4) (213.0) (7.7%) Tax (38.7) (35.9) (7.7%) Signif
Slide 14: EBITDA by business segment
EBITDA by business segment For personal use only 2010 2009 EBITDA split by segment $ million $ million Change Energy Gas Transmission and Distribution Investments Queensland 103.3 97.3 6.2 % 4% Asset Management New South Wales 96.8 83.4 16.1 % 7% Qld Victoria & South Australia 105.7 107.5 (1.7 %) 22
Slide 15: Gas transmission and distribution: Queensland
Gas transmission and distribution For personal use only Queensland Additional sales on Carpentaria Gas Pipeline – Davenport Downs compressor station commissioned in June 2009 Berwyndale Wallumbilla Pipeline, acquired Davenport Downs compressor station April 2010 – 3 month revenue contribution 12
Slide 16: Gas transmission and distribution: New South Wales
Gas transmission and distribution For personal use only New South Wales Additional gas transport and storage sales on the Moomba Sydney Pipeline system in line with expansion Tariff increase of 4 per cent Young compressor station Continued expansion program 120 – Mainline program 96.8 – Young
Slide 17: Gas transmission and distribution: Victoria & South Australia
Gas transmission and distribution For personal use only Victoria & South Australia Victorian revenue relatively stable despite reduced gas volumes due to milder winter weather impact Expansion program – Northern augmentation Dandenong LNG storage facility, Vic LNG storage facility 120 105.7 –
Slide 18: Gas transmission and distribution: Western Australia & Northern Territory
Gas transmission and distribution For personal use only Western Australia & Northern Territory Additional sales on Goldfields Gas Pipeline – New compressor stations commissioned in May and August 2009 Goldfields Gas Pipeline access arrangement Ned’s Creek compressor station, WA – 10% reduction i
Slide 19: Asset Management and Energy Investments
Asset Management and Energy Investments For personal use only 40 Asset Management 32.3 Full year asset management services to EBITDA $ million Energy Infrastructure Investments 20 Short term contracts Long term contracts Reduction in lower margin third party work Energy Investments ‐ 2008 2009 2
Slide 20: Fully covered distributions
Fully covered distributions For personal use only 2010 distribution growth of 5.6% 60 51.9 2010 distribution payout ratio* 50 48.2 of 64.4% cents per security 42.7 10 year compound annual 38.2 39.7 40 growth rate ‐ 4.9 % for operating cash flow 30 32.75 per security 29.5 31.0 28.0 ‐ 5.1 % for di
Slide 21: Major capital expenditure
Major capital expenditure For personal use only 2010 2009 Description of 2010 major projects $ million $ million Growth capital expenditure Regulated Victoria Transmission System 30.9 Northern augmentation project 21.3 APA Gas Networks (Qld) 21.2 Includes southern network expansion 18.8 Major Projec
Slide 22: Funding 2010 growth capital expenditure
Funding 2010 growth capital expenditure For personal use only 2010 $ million Growth capital expenditure 319 Funds Free operating cash flow retained in the business (Operating cash flow less distributions and SIB capex) 83 26% Equity raised through – DRP 57 – SPP 85 142 45% Debt funding required 87 2
Slide 23: Prudent capital management
Prudent capital management For personal use only Cash and committed undrawn facilities of $538 million at 30 June 2010 2010 metrics – Gearing* of 69.8%, reduced from 70.3% at 30 June 2009 – Interest Cover Ratio of 2.11x, reduced from 2.13x at 30 June 2009 – Interest rate exposure fixed or hedged
Slide 24: Capital management strategy in action
Capital management strategy in action For personal use only Managing balance sheet to maintain minimum investment grade credit rating metrics – Standard &Poor’s BBB; Moody’s Baa2 Refinancing program focused on extending debt maturity, diversifying funding sources and reducing debt costs – $1,365
Slide 25: Outlook and guidance
For personal use only Outlook and guidance Mick McCormack Managing Director and CEO 2010 Result Presentation Æ 24
Slide 26: Strategy for sustainable, profitable growth
Strategy for sustainable, profitable growth Continue to maximise value for stakeholders For personal use only Enhancing APA’s portfolio of gas infrastructure assets in Australia’s growing gas market – Abundant domestic gas reserves – Increasing demand for natural gas, in particular for power gener
Slide 27: APA growth drivers and opportunities
APA growth drivers and opportunities For personal use only Growth drivers APA’s development opportunities Gas supply and demand Expanding pipeline capacity to deliver larger Increasing gas reserves and production capability, volumes together with increasing gas demand Developing pipelines to tra
Slide 28: Current portfolio growth projects
Current portfolio growth projects For personal use only Roma Brisbane Pipeline Capacity expansion (FID) APA Gas Network Network expansion to new housing developments Mondarra Gas Storage Facility Expanding storage capacity and Moomba Sydney Pipeline capability Mainline expansion and pressure Interco
Slide 29: Outlook and guidance for 2011
Outlook and guidance for 2011 For personal use only Outlook Continued focus on enhancing APA’s gas infrastructure portfolio – organic growth driven by customer requirements Further investment decisions influenced by – government policy settings – completion of NSW Energy Privatisation – investme
Slide 30: Supplementary information
For personal use only Supplementary information 2010 Result Presentation Æ 29
Slide 31: APA profile
APA profile For personal use only APA is Australia’s largest natural gas infrastructure business – Gas Transmission and Distribution: gas pipelines, interconnected gas storage facilities across Australia, and gas distribution networks in Queensland and New South Wales – Asset Management: provides
Slide 32: Key financial ratios
Financials For personal use only Key financial ratios 2010 2009 Operating cash flow per security (cents) 51.9 48.2 Weighted average securities on issue (million) 516.2 485.1 Payout ratio 64.4% 65.6% Earning per security (cents) 19.4 16.2 Interest cover ratio (times) 2.11 2.13 Gearing ratio 69.8% 70.
Slide 33: Cash flow
Financials For personal use only Cash flow 2010 2009 $ million $ million Change Operating cash flow 267.8 233.6 14.6 % Distributions (net of DRP) 103.1 95.1 Available operating cash flow 164.7 138.5 18.9 % Operating cash flow per security (cents) 51.9 48.2 7.7 % Distributions per security (cents) 32
Slide 34: Revenue analysis by business segment
Financials For personal use only Revenue analysis by business segment 2010 2009 $ million $ million Change Gas Transmission and Distribution Queensland 151.2 143.9 5.0% New South Wales 120.8 107.9 11.9% Victoria & South Australia 138.9 137.6 0.9% Western Australia & Northern Territory 155.4 154.2 0.
Slide 35: Total committed debt facilities
Financials For personal use only Total committed debt facilities Facility Facility amount Tenor 2008 Bilateral borrowings 1 $165 million July 2011 2009 Bilateral borrowing 2 $150 million August 2014 2007 Syndicated facility 2 $900 million June 2012 2009 Syndicated facility 3 $1,030 million 2 and 4 y
Slide 36: Regulatory update
Regulatory update For personal use only APA’s major price regulated assets Regulatory resets over the next five years Regulatory resets are spread out over five years, with on average one reset per year – Goldfields Gas Pipeline new access arrangement commenced on 20 August 2010 – APA Gas Network
Slide 37: APA asset and investment portfolio
APA asset and investment portfolio For personal use only 2010 Result Presentation Æ 36
Slide 38: Disclaimer
Disclaimer For personal use only The information contained in this presentation is given without any liability whatsoever to Australian Pipeline Trust or APT Investment Trust or any of its related entities (collectively “APA Group”) or their respective directors or officers, and is not intended to c
Slide 39: For further information contact
For personal use only For further information contact Celebrating 10 years of Chris Kotsaris Investor Relations, APA Group delivering Australia’s energy Tel: +61 2 9693 0049 E‐mail: chris.kotsaris@apa.com.au or visit APA’s website www.apa.com.au
Slide 40: ASX Release: further information and About APA Group
For personal use only ASX RELEASE 25 August 2010 For further information please contact: Investor enquiries: Media enquiries: Chris Kotsaris Kristin Silva Investor Relations APA Group Cato Counsel Telephone: (02) 9693 0049 Telephone: (02) 9212 4666 Mob: 0402 060 508 Mob: 0411 110 953 Email: chris.ko