Apa Group · ASX:APA
Apa — H1 FY2020 Earnings Presentation
32 slides from Apa's earnings presentation, Feb 18, 2020
Slide 1: ASX Announcement: Financial Results Presentation
Australian Pipeline Ltd ACN 091 344 704 | Australian Pipeline Trust ARSN 091 678 778 | APT Investment Trust ARSN 115 585 441 Level 25, 580 George Street Sydney NSW 2000 | PO Box R41 Royal Exchange NSW 1225 Phone +61 2 9693 0000 | Fax +61 2 9693 0093 APA Group | apa.com.au 18 February 2020 ASX ANNOUN
Slide 2: Financial results for half year ended 31 December 2019
financial results for For personal use only half year ended 31 December 2019. 18 February 2020
Slide 3: 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 For personal use only Investment Trust (ARSN 115 585 441) (APA Group). The information in this presentation does not conta
Slide 4: Results overview
For personal use only results overview. Rob Wheals stay connected. CEO and Managing Director 2019 full year employee update.
Slide 5: Financial highlights - solid results
financial highlights - solid results For personal use only $ million 1H FY20 1H FY19 change Revenue excluding pass-through(1) 1,077.8 1,012.9 Up 6.4% EBITDA 842.2 787.7 Up 6.9% Net profit after tax 175.0 157.4 Up 11.2% Operating cash flow(2) 511.9 470.2 Up 8.9% Operating cash flow per security (cent
Slide 6: Highlights
highlights For personal use only Operations Growth Customers 99.9% reliability $38.3m EBITDA APA Customer Promise gas nomination delivery from new assets launched 8.4/10 Networks $68.5m $145.1m SIB & IT technology capex growth capex 7/10 Transmission Customer Satisfaction scores 3 new assets 1ST Ene
Slide 7: Orbost Gas Processing Facility February 2020
Orbost Gas Processing Facility 11 February 2020 For personal use only • Commissioning delayed due to construction delays, with further delays due to local bush fire threat & air quality issues from smoke • Successfully commissioned gas-fired power generation on site & safely introduced sales gas int
Slide 8: Safety & environment
safety & environment For personal use only • TRIFR safety metric 7.37 (FY2020 target 5.5) & LTIFR safety metric 0.6 (FY2020 target 1.0) Injuries are less severe but still too many, particularly for contractors Contractor management ongoing priority & focus • New three year HSE Strategic Plan dev
Slide 9: Priorities for FY2020 - update
priorities for FY2020 - update complete review of APA’s purpose, vision and culture For personal use only implement new organisational model to support strategy execution In progress: • progress APA’s growth strategy, both organic in Australia, and possible US acquisition • continued focus on op
Slide 10: Financial performance
For personal use only financial performance. Peter Fredricson stay connected. Chief Financial Officer 2019 full year employee update.
Slide 11: Summary results
summary results For personal use only $ million 1H FY20 1H FY19 Change Revenue excluding pass-through(1) 1077.8 1,012.9 6.4% EBITDA 842.2 787.7 6.9% Depreciation and amortisation (319.4) (297.6) 7.3% EBIT 522.8 490.0 6.7% Net interest expense (245.3) (239.6) 2.4% Pre-tax profit 277.5 250.5 10.8% Tax
Slide 12: 1H FY2020 result: EBITDA by business segment
1H FY2020 result: EBITDA by business segment For personal use only $ million 1H FY20 1H FY19 Change Energy Infrastructure Queensland 506.3 511.6 (1.0%) New South Wales 81.6 75.4 8.1% Victoria & South Australia 63.5 68.8 (7.7%) Northern Territory 8.6 10.8 (21.0%) Western Australia 171.1 122.7 39.4% E
Slide 13: 1H FY2020 EBITDA bridge
1H FY2020 EBITDA bridge For personal use only Energy Infra structure 12
Slide 14: Low risk business model
low risk business model • Solid risk management processes in place For personal use only • Continue to manage counterparty risks by: Diversification of customers and industry exposures Assessment of counterparty creditworthiness Entering into long term contracts to support major capital spend
Slide 15: Capital expenditure
capital expenditure $ million 1H FY20 1H FY19 Growth capex projects: For personal use only Growth capex Orbost Gas Processing Plant in Vic Regulated – Victoria 28.4 14.0 Moomba Sydney Pipeline capacity Non-regulated expansion, providing additional capacity of ~20 TJ/day to Sydney/Melbourne East
Slide 16: Capital management
capital management • Cash and committed undrawn facilities of around $1,354 million as at 31 December 2019 For personal use only to meet the continuing needs of the business • Credit ratings: S&P BBB (outlook Stable, confirmed Dec 2019) Moody’s Baa2 (outlook Stable, confirmed Dec 2019) • Key capital
Slide 17: Debt maturity profile
debt maturity profile For personal use only APA maintains diversity of funding sources and spread of maturities(1) Notes: (1) APA debt maturity profile as at 31 December 2019. (2) USD denominated obligations translated to AUD at the prevailing rate at inception (USD144A - AUD/USD=0.7879, Euro and St
Slide 18: Fully covered distributions
fully covered distributions • Distribution payout ratio(1) of 53.0% For personal use only • Distribution components: • $71.8 million tax paid for FY19 8.52 cents APT franked profit distribution (FY2018: $52.0 million) 2.93 cents APT unfranked profit distribution • FY19 effective cash tax rate of 15.
Slide 19: FY2020 guidance
FY2020 guidance • Based on current operating plans and available information, APA reaffirms its guidance that For personal use only EBITDA for FY2020 is expected to be within the range of $1,660 million to $1,690 million • Net interest expense for FY2020 expected to settle towards the lower end of t
Slide 20: Outlook
For personal use only outlook. Rob Wheals stay connected. CEO and Managing Director 2019 full year employee update.
Slide 21: Energy outlook
energy outlook Global energy demand expected to continue steady growth in most scenarios – IEA For personal use only Gas remains a key part of the energy mix Global East Coast Australia – Gas supply & demand Contingent and Prospectives 2,500PJ 2P Undeveloped 2P Developed 2,000PJ AEMO gas demand fore
Slide 22: Growth opportunities
growth opportunities For personal use only EAST WEST ENERGY FUTURE NORTH AMERICA “supply” “demand” “lower carbon” “core business” - new infrastructure to - new infrastructure - renewables infrastructure - due diligence being connect new gas for new projects - firming power required undertaken on reg
Slide 23: Organisational review - complete
organisational review - complete For personal use only Purpose: why we exist We strengthen communities through responsible energy Vision: what we aspire to To be world class in energy solutions Culture: how we do things Build on our STARS values, we are customer focused, innovative and collaborative
Slide 24: APA's operating model
APA’s operating model For personal use only “creates strategic alignment across the organisation to empower APA’s people to make the best decision every time, balancing speed and governance in pursuit of superior outcomes consistent with its vision and purpose” New operating structure as at 10 Febru
Slide 25: Summary and outlook
summary and outlook 1H FY2020 – a solid result For personal use only • EBITDA up 6.9% • Operating cash flow up 8.9% • First full period contribution from new growth assets- $38.3 million • Growth capital expenditure continued - $145.1 million • Distribution of 23 cps, up 7.0% ps, plus 3.65 cps frank
Slide 26: APA's uniquely integrated energy assets
APA’s uniquely integrated energy assets For personal use only Assets and Investments Glossary AGPGLOS Amadeus Gas Pipeline AL Agnew Lateral BGP Bonaparte Gas Pipeline BWSF Badgingarra Wind and Solar Farms BWP Berwyndale Wallumbilla Pipeline CGP Carpentaria Gas Pipeline CRP Central Ranges Pipeline &
Slide 27: Supplementary information
For personal use only supplementary information. stay connected. 2019 full year employee update.
Slide 28: 1H FY20 operational summary - Energy Infrastructure
1H FY20 operational summary – Energy Infrastructure For personal use only 0 100 200 300 400 500 600 700 800 A$ 900m 1H FY17 1H FY18 1H FY19 1H FY20 East Coast + Central regions Western Australia Wallumbilla Gladstone Pipeline South West Queensland Pipeline Roma Brisbane Pipeline Carpentaria Gas Pipe
Slide 29: Energy infrastructure contracting
energy infrastructure contracting For personal use only Recontracting ongoing: Number of renewed firm service contracts • No formal access requests which may trigger 60 arbitration process 50 • Since the GMRG reforms (1 Aug 2017) were introduced, APA has entered into ~234 contracts or 40 contract ch
Slide 30: Corporate costs
corporate costs For personal use only • APA’s corporate costs (excluding one-off items) have been steady at ~ $36 million per half year period, despite EBITDA increasing 109.9% since 1H FY2015 1,000 A$ m 10% 800 8% 600 6% (1) 400 4% (2) 200 2% 0 0% 1H FY15 1H FY16 1H FY17 1H FY18 1H FY19 1H FY20 Cor
Slide 31: Debt facilities
debt facilities For personal use only Total committed debt facilities at 31 December 2019: $ million Facility Drawn Tenor amount amount 2015, 2016, 2017, 2018 & 2019 400 120 3 to 5 year facilities maturing between May 2020 to July 2022 Bilateral bank facilities 2018 Syndicated bank facilities 1,000
Slide 32: For further information contact
For personal use only For further information contact: Jennifer Blake Head of Investor Relations T: +61 2 9693 0097 M: +61 455 071 006 E: jennifer.blake@apa.com.au stay connected. Or visit the APA website at: 2019 full year www.apa.com.au employee update.