Slide 1: centrica
centrica
Slide 2: Disclaimer
Disclaimer This presentation does not constitute an invitation to underwrite, subscribe for, or otherwise acquire or dispose of any Centrica shares or other securities. This presentation contains certain forward-looking statements with respect to the financial condition, results, operations and busi
Slide 3: Sir Roger Carr, Chairman
Sir Roger Carr Chairman centrica
Slide 4: Nick Luff, Group Finance Director
Nick Luff Group Finance Director centrica
Slide 5: Commodity prices and clean dark and spark spreads
5 Average month ahead Clean dark 140 commodity prices em and spark spreads 120 l\h\~A oe io. | nanan tetereren os Clean Dark Spread ca 80 UK Gas (p/therm) watt 15 (eM) aod 60 OW ae sad 10 40 i . B TS ene 20 enema sass a sed 2011 2012 2013 2014 2011 2012 2013 2014 Average month ahead Average temperat
Slide 6: Period ended June 2013
Period ended 30 June 2013 Continuing operations: Revenue (£m) 13,651 11,977 Adjusted operating profit (£m) 1,583 1,447 Adjusted effective tax rate 47% 43% Group result: Adjusted earnings (£m) 767 753 Adjusted earnings per share () 14.8 14.6 Interim dividend per share (p) 4.92 4.62 38 after interest
Slide 7: Adjusted operating profit by segment
Period ended 30 June (£m) 2013 2012 British Gas 569 563 Direct Energy 165 155 Centrica Energy 802 693 Centrica Storage 47 36 Adjusted operating profit 1,583 1,447 Share of JV / associates’ interest and taxation (47) (49) Depreciation of FV uplifts to property, plant and equipment (81) (52) Group ope
Slide 8: British Gas operating profit analysis
8 iod ended British Gas 569 563 June (£m) Adjusted operating profit 1,583 1,447 ‘Above figures include share of joint ventures and associates before interest and taxation and are before depreciation of fair value uplits to property, plant and equipment from Strategic Investments and exceptional item
Slide 9: British Gas - operating profit & key drivers
British Gas - operating profit & key drivers Residential energy revenue (£m) and margin (%) 2012 2013 Operating profit Period ended 30 June (£m) 2013 2012 Residential energy 356 345 Residential services 135 125 Business 78 93 British Gas 569 563 Residential services revenue (£m) and margin (%) 2012
Slide 10: Operating profit analysis: Direct Energy
10 Operating profit analysis Period ended 30 June (£m) 20 Direct Energy 165 155 Adjusted operating profit 1,583 1,447 ‘Above figures include share of joint ventures and associates before interest and taxation and are before depreciation of fair value uplits to property, plant and equipment from Stra
Slide 11: Direct Energy - operating profit & key drivers
Direct Energy - operating profit & key drivers Operating profit Residential energy 99 101 Business energy 53 43 Services 13 11 Direct Energy 165 155 Residential energy revenue Business energy revenue Services revenue (£m) and margin (%) (£m) and margin (%) (£m) and margin (%) 2012 2013 2012 2013 ‘Ab
Slide 12: Operating profit analysis: Centrica Energy
12 Operating profit analysis riod ended 30 June (Er Centrica Energy 802 693 Adjusted operating profit 1,583 1,447 ‘Above figures include share of joint ventures and associates before interest and taxation and are before depreciation of fair value uplits to property, plant and equipment from Strategi
Slide 13: Centrica Energy - operating profit & key drivers
13 Centrica Energy - operating profit & key drivers ee profit 30 June (£m) Gas 683 519 Power 119 174 Centrica Energy 802 693 Gas & oil production Power generation (TWh) / achieved volumes Average achieved sales price CSS / nuclear power price (£/MWh) Gas (mmth) Liquids (mmboe) Gas (p/therm) Liquids
Slide 14: Centrica Storage
Period ended 30 June (£m) Centrica Storage 47 36 Adjusted operating profit 1,583 1,447 Storage revenue (£) Forward price spreads (p/therm) 18 moOther 16 @spBu 12 —W12-S12 spread W14-S14 9 spread 6 W13-S13 spread 3 0 2012 2013 2011 2012 2013 ‘Above figures include share of joint ventures and associat
Slide 15: Cash flow
Morecambe Cash flow Period ended 30 June (£m) H1 2013 H1 2012 ry Opening net debt (4,047) (8,292) (8,292) \ EBITDA 2,112 1,773 38,650 Working capital movements (112) (333) (61) Margin calls (2) 182 114 Interest and tax (506) (334) (696) Net capex (755) (1,525) (2,727) Dividends (607) (671) (815) Sha
Slide 16: Capital expenditure by segment
Period ended 30 June (£m) H1 2013 = H1 2012 International gas and oil 495 832 Centrica Energy power! 53 168 British Gas 80 66 Direct Energy 28 16 Centrica Storage 27 33 Other 22 25 Total pre-acquisitions 705 640 Acquisitions / disposals 50° 885 Total 755 1,525 etl Tn > => AOR 55 —— —— — war —
Slide 17: Summary and outlook
17 Summary and outlook Earnings up 2% Higher International Downstream profit — BGR profit marginally higher — challenging market conditions for BGB; BGS profit up 8% in weak economic environment — DE downstream profit growth despite a rising gas price environment ° Higher International Upstream prof
Slide 18: Sam Laidlaw, Chief Executive
Sam Laidlaw Chief Executive centrica
Slide 19: Our strategic priorities
19 Our strategic priorities Innovate to drive growth and service excellence Integrate our natural gas business, linked to our core markets Increase our returns through efficiency and continued capital discipline The leading integrated energy company with customers at its core centrica
Slide 20: Strategic progress
20 Strategic progress ° New management structure in place, under the leadership of Chris Weston for International Downstream and Mark Hanafin for International Upstream * Further development of leading downstream propositions, through innovation and service excellence * Hess’ Energy Marketing acquis
Slide 21: Delivering for our customers and investing in jobs
21 Delivering for our customers and investing In jobs ° ‘Tariff Check’ launched, enabling British Gas customers to chose the best deal for them * Over 500,000 vulnerable and elderly customers received £130 Warm Home Discount last winter * 1,000 apprentices currently in training with British Gas * Co
Slide 22: Leadership in innovation and customer service
22 Leadership in innovation and customer service * Industry leading digital platform in the UK, providing differentiation through attractive propositions * Over 1 million smart meters installed in the UK * Good operational performance in BGS during cold winter; tailored tenant and landlord packages
Slide 23: Delivering downstream growth
23 Delivering downstream growth * BGR accounts up 56,000 reflecting competitive pricing position, customer service and leading digital platform * Organic profit growth in US North East * Scale benefits in North America; integration of NYSEG Solutions and Energetix * Bounce Energy acquisition adds 80
Slide 24: Acquisition of Hess' Energy Marketing business
Acquisition of Hess’ Energy Marketing business * Acquisition of Hess’ Energy Marketing business for $731m (£478m) plus additional working capital; one of the biggest B2B energy suppliers in the Eastern US * Substantially increases scale in competitive markets — DE becomes the largest business gas su
Slide 25: Cygnus, Kew, Grove asset map
• – • – – • – Cygnus • Kew Grove – York Rhyl Valemon – –
Slide 26: Strengthening our position along the gas value chain
26 Strengthening our position along [he gas value chain ° 20 year LNG export agreement with Cheniere — ‘capital light’ model — links and optimises our positions along the gas value chain * $1bn acquisition of gas and oil assets in WCSB — first investment under our MoU with QP! — strong overlap with
Slide 27: Flexibility in investment choices
27 Flexibility in investment choices ° ~£1.1bn p.a. to sustain upstream gas and oil production * Investment options across the Group — pipeline of upstream gas investment opportunities i — choices in offshore wind, new-build CCGT and gas % x = storage if regulatory climate permits — acquisition oppo
Slide 28: Summary
28 Summary * Strong performance in first half — ontrack for full year earnings growth * Good progress against strategic priorities * Strong cash generation and strong balance sheet — investment options across the Group — bought back over £240m of shares — real dividend growth, all paid in cash ‘cent