Genesis Energy Limited · NZX:GNE
Genesis Energy — Non-Deal Roadshow (November 2017)
34 slides from Genesis Energy's roadshow presentation, Nov 20, 2017
Slide 1: For personal use only
For personal use only
Slide 2: Key Information
For personal use only KEY INFORMATION Revenue: EBITDAF: Dividend Yield: Share Price: Market Capitalisation: Average Daily Turnover: Credit Rating:
Slide 3: Residential customer
RACHEL FOSTER RESIDENTIAL CUSTOMER
Slide 4: Market Overview
Oe\/ j Ge) io) =e 1@ la S) Market Lage , a PROJECT Overview Ey “oe Ss 3) LYDIA GENET ; Le ‘SIV FJAERESTAD af a =
Slide 5: About New Zealand
About New Zealand — good growth in a stable economic environment Novi7 GDP billion, st 970 we Ease of doing business st st Investor Global Protection Prosperity Index th Providing Sustainable, Secure Energy rd Economic Freedom Source: Economy Rankings 2017 (The World Bank), The Heritage Foundation 2
Slide 6: Overview of the New Zealand energy market
Overview of the New Zealand energy market Novi7 15 electricity lines companies gas distributors LPG distributors ry Cats Distribution state owned national Transmission transmission grid operator privately owned gas transmission network electricity customers gas customers, LPG customers residential c
Slide 7: Supply and demand
For personal use only SUPPLY DEMAND
Slide 8: Supply and demand
For personal use only SUPPLY DEMAND
Slide 9: Supply and demand
For personal use only SUPPLY DEMAND
Slide 10: Solar installed capacity and unsubsidised solar storage LCOE
For personal use only SOLAR – INSTALLED CAPACITY (MW) • 70 60 50 40 30 • 20 10 0 Aug-13 Feb-14 Aug-14 Feb-15 Aug-15 Feb-16 Aug-16 Feb-17 Industrial Commercial Small Medium Enterprises Residential UNSUBSIDISED SOLAR STORAGE LCOE1 - (US$/kWh) 2017 2022 $0.00 $0.05 $0.10 $0.15 $0.20 $0.25 Solar LCOE St
Slide 11: International comparison of residential electricity costs
For personal use only • • • ‒ ‒ 400 50 0 200 250 100 150 300 350 Portugal Germany Poland Turkey Italy Slovak Republic Denmark Greece Czech Republic Ireland Hungary Slovenia Chile Japan Belgium Austria Estonia Netherlands United Kingdom France Australia New Zealand Luxembourg Finland Sweden Switzerla
Slide 12: Business customer
ANDY BAKER BUSINESS CUSTOMER
Slide 13: About Genesis Energy
About Genesis Energy — only integrated energy management company in New Zealand HUNTLY 010,650 customers Poak Capacity/MW g 25% electricity market share @ 38% gas market share ® 19% LPG market share 1.5 products per customer TONGARIRO &3 Peak Capacity/MW HAU NUI @ Peak Capacity/MW PURPOSE: ~ TEKAPO
Slide 14: Why Genesis?
@ Why Genesis? 4. Agile culture embracing . Delivering a cohesive 2. Ensuring security of 3. Creating value customer experience supply in a volatile through an integrated and leading change with 3 products on one renewable market fuel position technology platform
Slide 15: Financial overview
Financial overview — a growing dividend stream over time $333 million of EBITDAF delivered in FY17 ahead of guidance 16.6c of dividends declared up 1.2% representing a cash yield of 6.7%. Dividend policy to grow in real terms over time with 3.8% growth delivered in past three years against inflation
Slide 16: Capital structure overview
Capital structure overview — long tenure debt in place at lower cost, with BBB+ rating from S&P * Average cost of debt 5.7%, down 80 basis points * Average tenure 11.4 years, up 3.9 years * S&P reaffirmed BBB+ rating post acquisitions in May 2017 with Net Debt/EBITDAF expected to return to upper end
Slide 17: Health & safety
Health & safety — zero harm is our commitment Our rigorous focus on health and safety has translated into tangible outcomes with our TRIFR remaining at sector-leading levels * No serious or lost time incidents in past 12 months Staylive, an important forum for industry collaboration and learnings, w
Slide 18: Strategy
Strategy and LYDIA GENET LOCAL ENERGY PROJECT COMMUNITY LIAISONiy
Slide 19: Strategy overview
Strategy overview REIMAGINING ENERG to put control in our customers’ hands Optimise Innovate Invest To improve short term return For medium term growth For long-term value creation Core Strategic Initiatives 3 Foundation investments in technology & digital Enabling Initiatives g Embed data-driven de
Slide 20: FY17 strategy highlights
FY17 strategy highlights — transformation journey underway Launched NZ’s first real Reset ' world research and oe ees South Wairarapa_ development energy Strategy and vision community Acquired additional 15% of Kupe for $168 million Acquired retail LPG distribution business of Nova Energy for $192 D
Slide 21: FY21 target EBITDAF
FY21 target EBITDAF — target to deliver $400 - $430 million by FY21 and top quartile TSR $15m -$20m $12m -$171 $13m -$17m " " | 7 $2m -$3m sem-gam 86m-10m ~~ $9m -$14m [| somone $400m- $385m - $430m '$410m FY17 $15m $333m delivered (see slides 29-33 for detail) FY17 EBITDAF Operational Residential B
Slide 22: For personal use only
For personal use only • • • • • • • • • • • • • • • • •
Slide 23: Innovating to lead
Innovating to lead — working with customers collaboratively to build our energy management capabilities Energy Innovation Management @) Local Energy Energy Project Management New Technologies Technology “Making Energy management real for our “Partnering with customers to test and customers by initia
Slide 24: FY18 guidance and FY21 targets
For personal use only • FY18 EBITDAF guidance range of $345 to $365 million including increased share of Kupe and transaction costs associated with acquisition of Nova Energy Retail LPG business • Target earnings profile remains to deliver $400+ million of EBITDAF in FY21 and a top quartile total sh
Slide 25: Thank You
For personal use only Thank You
Slide 26: Financial statements
Financial statements Novi7 Income Statement FY17 FY16 ~—- Variance Balance Sheet FY17 FY16 Variance ($m) ($m) ($m) ($m) Revenue 14,9511 2,011.3 (3.0%) Cash and Cash Equivalents 27.8 34.9 Total Operating Expenses (1,618.6) (1,676.0) 3.4% Other Current Assets 344.2 296.9 EBITDAF 332.5 335.3 (0.8%) Non
Slide 27: Operational highlights
Operational highlights Customer Key Information FY17 FY16 Variance EBITDAF ($ millions) 109.6 102.7 6.7% Electricity Only Customers 350,869 371,758 Gas Only Customers 18,439 19,782 LPG Only Customers 28,018 4,376 Customers with > 1 Product 113,304 99,958 Total Customers 510,630 495,874 3.0% Volume W
Slide 28: Chief Executive
For personal use only ____ ____ Chief Executive
Slide 29: Operational excellence & value optimisation
Operational excellence & value optimisation — delivering best in class cost to serve and optimising value FY17 Actions FY17: $5m delivered! Customer to FY21: Remaining target $5 - $8m VY Streamlining the “customer join” experience, assisted by Key Metrics investment in customer relationship manageme
Slide 30: Increase value share of residential category
Increase value share of residential category — through differentiated products, loyalty rewards and portfolio optimisation FY17 Actions X Customer losses higher than expected following value optimisation V Launched Fly Buys with >120,000 customers linked V Targeted retail pricing changes based aroun
Slide 31: Targeted growth in business category
Targeted growth in business category — growing customers and volumes in the business category FY17 Actions VY Set up dedicated regional field sales force with 8 FTE recruited into 2 teams — SME and agribusiness VY Optimised pricing across the customer base including new pricing plans and more immedi
Slide 32: Grow LPG category
Grow LPG category — a higher margin fuel, with greater growth prospects and lower churn FY17 Actions FY17: $1m delivered! VY Acquisition of the Nova Energy retail LPG operation to FY21: Remaining target $6 - $10m accelerates capabilities with integration a key focus VY New bottled gas smart plan and
Slide 33: Build energy services
Build energy services — delivery of comfort, convenience and control to customers FY17 Actions VY Launch Local Energy Project (LEP) community in South Wairarapa with 200+ customers Y Established digital development capability Y Build Energy Management test platform VY Launch Energy Insights trial V
Slide 34: Thank You
For personal use only Thank You