Slide 1: Financial results year ended 30 June 2016
financial results year ended 30 June 2016. For personal use only 24 August 2016
Slide 2: Disclaimer
disclaimer This presentation has been prepared by Australian Pipeline Limited (ACN 091 344 704) as responsible entity of the Australian Pipeline Trust (ARSN 091 678 778) and APT Investment Trust (ARSN 115 585 441) (APA Group). For personal use only The information in this presentation does not conta
Slide 3: Results overview and strategic highlights
results overview and strategic highlights For personal use only Mick McCormack Managing Director and CEO. 24/08/2016 3
Slide 4: Financial highlights
financial highlights $ million 2016 2015 change For personal use only Statutory results EBITDA 1,330.5 1,269.5 Up 4.8% Net profit after tax 179.5 559.9 Down 67.9% Operating cash flow(1) 862.4 562.2 Up 53.4% Operating cash flow per security (cents) 77.4 56.5 Up 37.0% Normalised results(2) EBITDA from
Slide 5: Success through investments and innovation
success through investments and innovation • To meet our customers’ evolving East Coast Grid For personal use only needs in a dynamic energy market • WGP – full year contribution • Investments • Multi-asset and flexible services • Major bi-directional pipeline projects to enhance our infrastructur
Slide 6: Delivering for customers and the energy industry
delivering for customers and the energy industry Since listing in 2000, LNG case study Southern markets case study For personal use only APA has invested in… Customer request: Market need: • 2,000km+ pipelines added • Borrow sizeable amount of gas • Move gas from Queensland to • $2.5bn+ organic grow
Slide 7: A disciplined and prudent approach to growth
a disciplined and prudent approach to growth Acquisitions Organic growth For personal use only Diamantina acquisition • Enterprise value $700m • Financial close on 31 March 2016 • Long term contracts with Glencore’s Mount Isa Mines and the Queensland government owned Ergon Energy • Aligns with APA’s
Slide 8: Industry best practice in safety and operations
industry best practice in safety and operations TRIFR(1) Health and safety For personal use only • Zero Harm workplace • Safeguard+: new incident reporting platform • Health & Safety audit – 95% compliance rating • Conclusion of initial 3-year HSE Strategic Improvement Plan, a new 3-year plan commen
Slide 9: Financial performance
financial performance Peter Fredricson For personal use only Chief Financial Officer 24/08/2016 9
Slide 10: Reconciliation – statutory and normalised results
reconciliation – statutory and normalised results For personal use only $ million FY2016 FY2015 Change Significant Significant Statutory Normalised Statutory Normalised Normalised items items Revenue excluding pass-through(1) 1,656.0 - 1,656.0 1,119.2 - 1,119.2 48.0% EBITDA – continuing businesses(2
Slide 11: FY16 result: EBITDA by business segment
FY16 result: EBITDA by business segment $ million 2016 2015 Change % of EBITDA(4) For personal use only Energy Infrastructure Queensland 855.8 340.1 151.6% 60.4% New South Wales 121.7 120.8 0.7% 8.6% Victoria & South Australia 123.1 132.1 (6.8%) 8.7% Northern Territory 17.5 18.0 (2.8%) 1.2% Western
Slide 12: FY16 EBITDA bridge
FY16 EBITDA result: EBITDA bridgeby business segment • 6% organic growth achieved For personal use only • $469.3 million contribution from WGP, DPS and EPX * Note: Includes net contribution from the 100% ownership of Wallumbilla Gladstone Pipeline, Ethane Pipeline Income Fund and the Diamantina & Le
Slide 13: Low risk business model
low risk business model Energy Infrastructure revenue split For personal use only • APA has solid risk management processes in place • Continue to manage counterparty risks by: By contract type Diversification of customers & industry exposures Assessment of counterparty creditworthiness By custo
Slide 14: FY16 operational summary – Energy Infrastructure
FY16 operational summary – Energy Infrastructure For personal use only East Coast Grid + Northern Territory Western Australia • EBITDA from APA’s ECG increased by 82% • EBITDA from WA assets increased by • WGP contributed $475 million for the full year 2% • Queensland assets performed strongly, incr
Slide 15: FY16 operational summary – Asset Management, Energy Investments and Corporate costs
FY16 operational summary – Asset Management, Energy Investments and Corporate costs For personal use only Asset Management Asset Management EBITDA • Organic growth from more connections • Natural gas = fuel of choice for more residential homes • Customer contribution average remains ~$10m p.a. Energ
Slide 16: Capital expenditure and investment cash flows
capital expenditure and investment cash flows $ million 2016 2015 For personal use only Growth capex Regulated – Victoria 130.9 136.1 Non-regulated Queensland 14.0 104.4 New South Wales 4.8 12.1 Western Australia 97.6 64.2 Customer contributions 5.3 2.7 Other 28.4 26.3 Total growth capex 281.0 345.8
Slide 17: Capital management
capital management For personal use only • Cash and committed undrawn facilities of around $755.4 million as at 30 June 2016 to meet the continued capital growth needs of the business • Credit ratings – S&P: BBB (outlook Stable), Moody’s Baa2 (outlook Stable) • Key capital ratios are as follows: Met
Slide 18: Debt maturity profile
debt maturity profile • APA maintains diversity of funding sources and spread of maturities For personal use only Note: (1) USPP notes of $86m matured in July2016 and were repaid (2) USD denominated obligations translated to AUD at the prevailing rate at inception (USD144A - AUD/USD=0.7879, EMTN & S
Slide 19: Fully covered distributions
fully covered distributions For personal use only • FY2016 distribution payout ratio(1, 2) of 53.6% APA’s Distribution Policy • Distribution components: • Fully covered by Operating Cash Flow 31.46 cents APT profit distribution • Regard for capital needs of the business 1.78 cents APT capital distri
Slide 20: FY17 guidance
FY17 guidance For personal use only • Based on current operating plans and available information, EBITDA for FY2017 is expected to be within a range of $1,425 million to $1,445 million • Net interest costs for FY2017 expected within a range of $510 million to $520 million • Distributions per securit
Slide 21: Outlook
outlook Mick McCormack For personal use only Managing Director and CEO. 24/08/2016 21
Slide 22: APA supports objective of developing a liquid gas market
APA supports objective of developing a liquid gas market Market dynamics East coast gas consumption For personal use only • Gas consumption on the east coast of Australia has trebled in the last couple of years • Gladstone export gas pipeline volumes show daily swing in volumes • Gas transmission ta
Slide 23: APA's growth strategy and opportunities
APA’s growth strategy and opportunities Organic growth opportunities Over the short term (~3 years), $1.5bn opportunities are available For personal use only • Pipeline extensions and expansions c.$700m • Expand renewables and generation foot print c.$500m • Expand mid-stream asset footprint c.$300m
Slide 24: For personal use only
For personal use only 10/08/2016 24
Slide 25: Supplementary information
supplementary information For personal use only 24/08/2016 25
Slide 26: Snapshot of APA
snapshot of APA Australian gas transmission pipeline ownership by kilometres APA Overview (Ticker: APA AU) For personal use only ~ APA is Australia’s largest gas pipeline owner ~ Market cap A$10.3 billion (as at 23 Aug 2016) ASX rank S&P/ASX 50 Credit rating Moody’s: Baa2 (outlook Stable) S&P: BBB (
Slide 27: Group structure
group structure For personal use only • APA is a stapled structure comprising two registered managed investment schemes: Australian Pipeline Trust (ARSN 091 678 778) APT Investment Trust (ARSN 115 585 441) is a tax pass-through trust • Australian Pipeline Limited (ACN 091 344 704) is the respons
Slide 28: Strong historical performance
strong historical performance Normalised EBITDA Normalised operating cash flow For personal use only Total assets Distributions 28
Slide 29: Debt facilities
debt facilities For personal use only Total committed debt facilities at 30 June 2016 $ million Facility Drawn Tenor amount amount 2015 & 2016 Bilateral bank facilities 550 85 2 to 5 year facilities maturing between May 2018 to May 2021 2.25, 3.25 and 5.25 year tranches maturing September 2017, 2018
Slide 30: Regulatory update
regulatory update • Approximately 10% of APA’s Energy Infrastructure revenues in FY16 was regulated revenue For personal use only • APA’s major regulatory resets over the next few years are as follows: • Goldfields Gas Pipeline access arrangement review Western Australian Economic Regulation Autho
Slide 31: Economic regulation of gas pipelines and networks
economic regulation of gas pipelines and networks Regulator • The Australian Energy Regulator (AER) is responsible for the economic regulation of gas For personal use only transmission and distribution networks and enforcing the National Gas Law and National Gas Rules in all jurisdictions except Wes
Slide 32: For further information contact
For personal use only For further information contact: Yoko Kosugi Head of Investor Relations Tel: +61 2 9693 0049 E-mail: yoko.kosugi@apa.com.au Or visit the APA website at: www.apa.com.au 32