Atlas Arteria · ASX:ALX
Atlas Arteria — FY2020 Earnings Presentation
53 slides from Atlas Arteria's earnings presentation, Feb 25, 2021
Slide 1: ASX Release: Results Presentation for year ended 31 December 2020
25 February 2021 For personal use only ASX RELEASE Atlas Arteria Results Presentation for the year ended 31 December 2020 Atlas Arteria (ASX:ALX) is pleased to release the attached results presentation for the year ended 31 December 2020. _____________________________________________________________
Slide 2: Results Presentation for the year ended 31 December 2020
Atlas Arteria | Results Presentation for the year ended 31 December 2020 For personal use only Results Presentation For the year ended 31 December 2020
Slide 3: Important Information
Atlas Arteria | Results Presentation for the year ended 31 December 2020 2 Important Information For personal use only Disclaimer Forward Looking Statements No Offer The information in this presentation is given in good faith and This presentation may contain forward-looking statements This presenta
Slide 4: Contents
Atlas Arteria | Results Presentation for the year ended 31 December 2020 3 Contents For personal use only 1. Key Highlights Graeme Bevans, CEO 2. Financial Performance Nadine Lennie, CFO 3. Operations Graeme Bevans, CEO 4. Outlook Graeme Bevans, CEO 5. Appendices Photo of Dulles Greenway, source: Da
Slide 5: Key Highlights
Atlas Arteria | Results Presentation for the year ended 31 December 2020 4 For personal use only 1 Key Highlights Graeme Bevans Chief Executive Officer Photo of APRR, source: APRR
Slide 6: 2020 Key Highlights
Atlas Arteria | Results Presentation for the year ended 31 December 2020 5 2020 Key Highlights 2020 has been a year for building resilience and capacity for growth at Atlas Arteria For personal use only Uninterrupted operations - focus on health, customers and communities • Traffic across all the ju
Slide 7: 2020 Milestones
Atlas Arteria | Results Presentation for the year ended 31 December 2020 6 2020 Milestones Continued delivery against strategy to build resilience, grow cashflows and enhance long-term value For personal use only Strategic Framework Reduce legacy Maximise operational Disciplined capital complexity t
Slide 8: Managing through COVID-19
Atlas Arteria | Results Presentation for the year ended 31 December 2020 7 Managing through COVID-19 COVID-19 impact on traffic and operations varied across our businesses, however seamless operations were maintained For personal use only France (APRR / ADELAC) Considered and measured operational re
Slide 9: Managing through COVID-19
Atlas Arteria | Results Presentation for the year ended 31 December 2020 8 Managing through COVID-19 Businesses well positioned for 2021 and beyond For personal use only Key trends The Atlas Arteria business Rolling movement restrictions to manage COVID-19 • Business continuity plans well engrained,
Slide 10: COVID-19 Overview by Region
Atlas Arteria | Results Presentation for the year ended 31 December 2020 9 COVID-19 Overview by Region France For personal use only 1 Feb 2020 1 Apr 2020 1 Jun 2020 1 Aug 2020 1 Oct 2020 1 Dec 2020 1 Feb 2021 Progressive 17 March, border 11 May – 22 June, easing of lockdown 29 October, restrictions
Slide 11: Financial Overview
Atlas Arteria | Results Presentation for the year ended 31 December 2020 10 Financial Overview COVID-19 impacted traffic across our portfolio, with European roads showing resilience during the second wave For personal use only Revenue Performance for 2020 vs 2019 Business Overview Contribution to Tr
Slide 12: Traffic in Europe Demonstrates Resilience
Atlas Arteria | Results Presentation for the year ended 31 December 2020 11 Traffic in Europe Demonstrates Resilience For personal use only APRR Warnow Tunnel APRR Traffic vs. 2019 Rapid recovery post Warnow Tunnel Traffic vs 2019 Rapid recovery post restrictions easing 20.0% restrictions easing Q3,
Slide 13: Sustainability Achievements in 2020
Atlas Arteria | Results Presentation for the year ended 31 December 2020 12 Sustainability Achievements in 2020 Strong success on our sustainability priorities in 2020 For personal use only Atlas Arteria SAFETY OUR PEOPLE ranked 4th out of 156 • Improved safety metrics across the business • 50% gend
Slide 14: Sustainability Priorities for 2021
Atlas Arteria | Results Presentation for the year ended 31 December 2020 13 Sustainability Priorities for 2021 Continuing focus on our sustainability priorities in 2021 For personal use only CUSTOMERS & ENVIRONMENTAL SAFETY OUR PEOPLE COMMUNITY STEWARDSHIP • Continue to embed a safety-first • Mainta
Slide 15: Financial Performance
Atlas Arteria | Results Presentation for the year ended 31 December 2020 14 For personal use only 2 Financial Performance Nadine Lennie Chief Financial Officer Photo of APRR, source: APRR
Slide 16: Setting the Scene: Capital Management Strategy
Atlas Arteria | Results Presentation for the year ended 31 December 2020 15 Setting the Scene: Capital Management Strategy For personal use only Managing capital for a sustainable business 2020 Objectives Capital management in 2020 Maintaining balance • Dual focus on cash flow and balance sheet to e
Slide 17: Strong Balance Sheet
Atlas Arteria | Results Presentation for the year ended 31 December 2020 16 Strong Balance Sheet Substantial liquidity headroom at corporate and business levels For personal use only Atlas Arteria holds c. A$194 million of liquidity APRR continues to be well capitalised with Dulles Greenway has c. U
Slide 18: Atlas Arteria Cashflow for H2 20
Atlas Arteria | Results Presentation for the year ended 31 December 2020 17 Atlas Arteria Cashflow for H2 2020 For personal use only APRR dividends to Atlas Arteria Corporate operational cashflows Cash balance (€m) (A$m) (A$m) H1 20 Remove APRR Eiffarie Dist. from MAF2 ALX ALX Warnow Macquarie Corp.
Slide 19: Atlas Arteria Income Statement
Atlas Arteria | Results Presentation for the year ended 31 December 2020 18 Atlas Arteria Income Statement Atlas Arteria A$m 2020 2019 % Chg Profitability impacted by COVID-19 For personal use only Revenue and other income — Toll revenue 95.3 150.4 (37%) Toll revenue performance a result of COVID-19
Slide 20: APRR Financial Performance
Atlas Arteria | Results Presentation for the year ended 31 December 2020 19 APRR Financial Performance COVID-19 movement restrictions impacted financial performance during 2020, but traffic is recovering well For personal use only €m1 2020 2019 % change • Revenues exclude IFRIC 12 and were impacted
Slide 21: APRR Financial Position
Atlas Arteria | Results Presentation for the year ended 31 December 2020 20 APRR Financial Position APRR strong balance sheet rated A- / A-2 with a stable outlook For personal use only APRR Group pro-forma debt maturity profile as at 31 Dec 2020 APRR has significant balance sheet flexibility to supp
Slide 22: Warnow Tunnel Financial Overview
Atlas Arteria | Results Presentation for the year ended 31 December 2020 21 Warnow Tunnel Financial Overview Continued strong financial performance at Warnow, with restructured debt to unlock cash flows For personal use only €m1 2020 2019 % change • Traffic at Warnow continues to perform well, despi
Slide 23: Dulles Greenway Financial Overview
Atlas Arteria | Results Presentation for the year ended 31 December 2020 22 Dulles Greenway Financial Overview Strong liquidity at the Dulles Greenway, traffic impacted by continued working from home recommendations For personal use only US$m1 2020 2019 % change • Operating revenues impacted by redu
Slide 24: Operations
Atlas Arteria | Results Presentation for the year ended 31 December 2020 23 For personal use only 3 Operations Graeme Bevans Chief Executive Officer Photo of Warnow Tunnel, source: Trent Perrett Photography
Slide 25: Critical Infrastructure that Link Communities
Atlas Arteria | Results Presentation for the year ended 31 December 2020 24 Critical Infrastructure that Link Communities Our networks provide critical infrastructure that connects our customers with their communities For personal use only Keeping communities connected Edouard is a truck driver, hau
Slide 26: APRR and ADELAC Operational Update
Atlas Arteria | Results Presentation for the year ended 31 December 2020 25 APRR and ADELAC Operational Update Working closely with the French Government to provide services and safe travel For personal use only Operational update Recognition • Operations were maintained during the COVID-19 pandemic
Slide 27: APRR Capital Expenditure
Atlas Arteria | Results Presentation for the year ended 31 December 2020 26 APRR Capital Expenditure Investing to grow the footprint and improve customer experience For personal use only Projects currently underway • There were some delays as a result of COVID-19, but all capex projects are now prog
Slide 28: Warnow Tunnel Operational Update
Atlas Arteria | Results Presentation for the year ended 31 December 2020 27 Warnow Tunnel Operational Update Operational enhancements continued to be implemented to meet the needs of customers and communities For personal use only Operational update • Operational highlights: — A survey of almost 1,6
Slide 29: Dulles Greenway Operational Update
Atlas Arteria | Results Presentation for the year ended 31 December 2020 28 Dulles Greenway Operational Update We continue to focus on improving the customer experience and position the Greenway for the return of traffic For personal use only Operational update • Operational highlights: — Ms. Renée
Slide 30: Outlook
Atlas Arteria | Results Presentation for the year ended 31 December 2020 29 For personal use only 4 Outlook Graeme Bevans Chief Executive Officer Photo of Dulles Greenway, source: David Madison photography
Slide 31: Key Priorities and Outlook for 2021
Atlas Arteria | Results Presentation for the year ended 31 December 2020 30 Key Priorities and Outlook for 2021 For personal use only Atlas Arteria APRR and ADELAC Warnow Tunnel Dulles Greenway • Continued focus on sustainability, • Ongoing dialogue with French State • Continue to engage with the lo
Slide 32: Attractive Investment Proposition
Atlas Arteria | Results Presentation for the year ended 31 December 2020 31 Attractive Investment Proposition For personal use only Material exposure to Recognised strong Resilient balance Access to inflation European and French ESG and Sustainability sheet with good linked earnings GDP fundamentals
Slide 33: Thank You
Atlas Arteria | Results Presentation for the year ended 31 December 2020 32 For personal use only Thank You Q&A Contact for investors Jeanette Royce| Director, Investor Relations Australia : 1800 621 694 International: +61 (0)438 493 692 investors@atlasarteria.com Photo of APRR, source: APRR
Slide 34: Appendix – Additional Financial Information
Atlas Arteria | Results Presentation for the year ended 31 December 2020 33 For personal use only 5A Appendix – Additional Financial Information Photo of APRR, source: APRR
Slide 35: Atlas Arteria Consolidated Balance Sheet
Atlas Arteria | Results Presentation for the year ended 31 December 2020 34 Atlas Arteria Consolidated Balance Sheet For personal use only As at As at Statutory accounts 31 Dec 2020 31 Dec 2019 A$m Current assets 267.6 1,593.6 Investments in associates 2,635.5 1,363.8 Tolling concessions 2,064.3 2,4
Slide 36: Atlas Arteria Corporate Cash Flow Summary
Atlas Arteria | Results Presentation for the year ended 31 December 2020 35 Atlas Arteria Corporate Cash Flow Summary For personal use only (A$m) 2020 2019 Opening balance 1,387.6 92.8 Distributions from APRR 310.9 238.2 Fees from Warnow Tunnel 0.2 0.3 Interest income on corporate cash balances 1.8
Slide 37: Proportionate EBITDA by Business
Atlas Arteria | Results Presentation for the year ended 31 December 2020 36 Proportionate EBITDA by Business APRR 100% (€m) 2020 2019 % change Dulles Greenway 100% (US$m) 2020 2019 % change For personal use only Traffic (VKTm) 19,413 24,581 (21.0%) Traffic (m) 10.2 17.8 (42.7%) Operating revenue 2,1
Slide 38: Cash flow: APRR to Atlas Arteria Securityholders
Atlas Arteria | Results Presentation for the year ended 31 December 2020 37 Cash flow: APRR to Atlas Arteria Securityholders For personal use only Eiffarie / Financière Eiffarie (FE) (€m) H1 2020 (A) H2 2019 (A) H1 2019 (A) H2 2018 (A) H1 2018 (A) APRR dividend 234 416 371 381 400 add/less Cash with
Slide 39: Appendix – About the Business
Atlas Arteria | Results Presentation for the year ended 31 December 2020 38 For personal use only 5B Appendix – About the Business Photo of APRR, source: APRR
Slide 40: The Atlas Arteria Business
Atlas Arteria | Results Presentation for the year ended 31 December 2020 39 The Atlas Arteria Business For personal use only Atlas Arteria Portfolio Warnow Dulles APRR ADELAC Tunnel Greenway 31.14% 31.17% 100% 100%2 2,318km 20km commuter 2.1km road 22km commuter motorway road connecting and tunnel i
Slide 41: APRR and ADELAC connecting Paris with Lyon and central/eastern France
Atlas Arteria | Results Presentation for the year ended 31 December 2020 40 APRR and ADELAC connecting Paris with Lyon and central/eastern France An efficient, safe and cost effective network for customers For personal use only Comparison between average tolls on APRR versus rest of France 1 70 60 E
Slide 42: APRR Traffic Growth
Atlas Arteria | Results Presentation for the year ended 31 December 2020 41 APRR Traffic Growth Heavy vehicle traffic continues to be closely correlated to French Manufacturing, while the imposition of COVID-19 lockdown For personal use only measures has resulted in a temporary departure to long-ter
Slide 43: APRR Earnings Stability
Atlas Arteria | Results Presentation for the year ended 31 December 2020 42 APRR Earnings Stability EBITDA has historically been resilient through economic cycles For personal use only APRR EBITDA1 vs France GDP2 growth € 2,000m 6.0% 1,942 € 1,800m 1,874 1,775 3.0% € 1,600m 1,685 1,589 1,520 1,550 -
Slide 44: APRR Tariff Formula
Atlas Arteria | Results Presentation for the year ended 31 December 2020 43 APRR Tariff Formula APRR’s predictable cashflows are underpinned by inflation-linked tolling and established regulatory regime For personal use only • Stable concession regime: In place for another 14-15 years • Predictable,
Slide 45: French Tax Rates
Atlas Arteria | Results Presentation for the year ended 31 December 2020 44 French Tax Rates The Current Tax Situation For personal use only Corporate Income Tax Motorway Specific Tax Territorial economic contribution (CET) • The French Parliament approved the Finance Bill for • The French Tax Code
Slide 46: Warnow connecting the Baltic sea with Rostock and highways to Berlin
Atlas Arteria | Results Presentation for the year ended 31 December 2020 45 Warnow connecting the Baltic sea with Rostock and highways to Berlin Stable growth in an asset located in a favourable part of Europe For personal use only AADT Linear (AADT) 14,000 13,000 12,000 AADT 11,000 10,000 9,000 8,0
Slide 47: Warnow Tunnel Tariff Formula
Atlas Arteria | Results Presentation for the year ended 31 December 2020 46 Warnow Tunnel Tariff Formula Warnow Tunnel toll escalation For personal use only • Tolls may be escalated annually and are subject to approval by the Ministry of Energy, Infrastructure and State Development for the State of
Slide 48: Dulles Greenway Overview
Atlas Arteria | Results Presentation for the year ended 31 December 2020 47 Dulles Greenway Overview Connecting growing, prosperous communities to connector roads and Washington DC For personal use only On a stand alone basis, tolls on the Dulles Greenway are in the mid to high end of prices for the
Slide 49: Dulles Greenway Earnings History
Atlas Arteria | Results Presentation for the year ended 31 December 2020 48 Dulles Greenway Earnings History Stable historical financial performance For personal use only Financial performance vs Traffic ADT US$120m 60,000 US$100m 92.2 50,000 91.0 90.8 89.7 84.4 78.2 16.8 17.2 17.0 US$80m 74.1 16.5
Slide 50: Dulles Greenway Toll Regime
Atlas Arteria | Results Presentation for the year ended 31 December 2020 49 Dulles Greenway Toll Regime Tolls on the Dulles Greenway are set on application by the Virginia State Corporation Commission (SCC) For personal use only under the Virginia Highway Corporation Act (1988) (VHCA) • Section §56-
Slide 51: Atlas Arteria Summary Corporate Structure
Atlas Arteria | Results Presentation for the year ended 31 December 2020 50 Atlas Arteria Summary Corporate Structure For personal use only Stapled ATLAX (Australia) ATLIX (Bermuda) 13.43% 86.57% economic interest (via loans) Dulles Greenway 100% Third Party Investors Eiffage MIBL 33.71% 4.00% 62.29
Slide 52: Appendix – References
Atlas Arteria | Results Presentation for the year ended 31 December 2020 51 For personal use only 5C Appendix – References Photo of APRR, source: APRR
Slide 53: Glossary of terms
Atlas Arteria | Results Presentation for the year ended 31 December 2020 52 Glossary of terms AADT Average annual daily trips ESG Environmental, Social and Corporate Governance MIBL MIBL Finance Luxembourg S.à r.l. For personal use only ADELAC Autoroute des deux Lacs FE Financière Eiffarie SAS NUMA