Infratil Limited · NZX:IFT
Infratil — H1 FY2015 Earnings Presentation
23 slides from Infratil's earnings presentation, Nov 11, 2014
Slide 1: Infratil Half Year Results Presentation
Infratil 2014 INFRATIL HALF YEAR RESULTS PRESENTATION Six Months Ended 30 September 2014 11 November 2014
Slide 2: Half Year Overview
Half Year Overview Investment realisations provide capital management options • Record net surplus following asset realisations - $336.7m gain on sale of the IEA Group • EBITDAF from continuing operations +4.9% • New capital investment continues: replace - A$72m acquisition of Green State Power by T
Slide 3: Financial Highlights
Financial Highlights IEA Group divestment drives record net surplus Half Year Ended 30 September ($Millions) 2014 2013 Variance % Change EBITDAF (continuing activities)(1) 242.5 231.2 11.3 4.9% Operating Earnings (continuing activities)(1) 78.0 79.8 (1.8) (2.3%) Net Surplus after Tax, MI and Disc Op
Slide 4: Result Summary
Result Summary Adjusted EBITDAF +6.8% on prior year • $15.6m increase in adjusted EBITDAF(1) of $245.9m (+6.8%) • Increased contribution from Trustpower offset by lower historic cost contribution from Z Energy • Steady underlying performance from Z Energy, WIAL, NZ Bus and MET • IEA EBITDAF included
Slide 5: Results Summary
Results Summary Portfolio changes have dominated reported results IEA GROUP SALE • Sale of 100% of the IEA Group for net sales price of $670.4m • Net gain on sale of $336.7m • Gain on sale and 6 month results reported within discontinued operations OPERATING CASH FLOW • $122.2m for the period (-55%
Slide 6: EBITDAF Breakdown
EBITDAF Breakdown EBITDAF growth driven by Snowtown II wind farm HY 30 September ($Millions) Sep 2014 Sep 2013 Trustpower 173.3 153.2 • Trustpower – EBITDAF increase of 13% driven by growth in Australian generation Wellington Airport 40.4 42.4 volumes from Snowtown II NZ Bus 20.0 21.5 • WIAL – Reset
Slide 7: IEA Group Sale
IEA Group Sale Significant gain realised on sale • On 30 September 2014, Infratil completed the sale of 100% of the IEA Group to Snowy Hydro Limited for a net sales price of $670.4m, subject to finalisation of the working capital adjustment • Net gain on sale of $336.7m recognised within discontinue
Slide 8: Debt Profile
Debt Profile Strong net cash position and duration profile • Total Infratil and wholly owned subsidiaries(1) bank facilities of $502.6m. Net cash position of $640.4m at 30 September 2014 • Senior borrowing facilities include senior debt with terms up to 5 years and 7.5 year export credit facilities
Slide 9: Capital Management
Capital Management Current context - full range of alternatives examined • Following the sale of IEA, Infratil has significant cash balances, no net wholly-owned bank debt, and no bond maturities until November 2015 • Macro view suggests it will be advantageous to maintain financial flexibility in a
Slide 10: Capital Management (cont'd)
Capital Management (cont’d) A flexible and staged recommendation • A combination of a fully imputed special dividend and a share buy-back will improve capital efficiency while rewarding shareholders equitably: - Addresses current IFT valuation and capacity to secure long-term returns from growth inf
Slide 11: Net Asset Values
Net Asset Values Book Values at 30 September – sale of IEA has reduced totals 30 Sep 31 Mar • Trustpower – listed market value ($7.31) Investment(1,2) ($Millions) 2014 2014 reflects re-rating of generators-retailers post the NZ election Trustpower 1,167.7 1,036.7 • WIAL – minor movement reflects Wel
Slide 12: NZ Energy - Trustpower
NZ Energy - Trustpower Snowtown II construction completed ahead of expectations • EBITDAF of $173.3m up 13% over prior period • Good traction on mass market acquisitions through metro market campaigns • energy accounts increased to 255k, up 12% over prior period • multi-service offer continues to ga
Slide 13: NZ Fuel Distribution - Z Energy
NZ Fuel Distribution - Z Energy Solid underlying performance impacted by GRM and FX volatility • 13% decline in RC operating EBITDAF despite fuel marketing margin growth • Extremely low refining margins exacerbated by unplanned operational production outages at Refining NZ • Negative impacts from fo
Slide 14: Wellington International Airport
Wellington International Airport Major development programme initiated • EBITDAF -4.8% to $40.4m - 40 cent per passenger charge reductions effective 1 June 2014 - Passenger growth on budget but below trend, expected to improve in the second half of year - New Jetstar direct service to Coolangatta co
Slide 15: NZ Public Transport – NZ Bus
NZ Public Transport – NZ Bus New contract environment imminent • EBITDAF $20.0m vs prior year $21.5m - Total passengers of 31 million, up 3% on the prior year - Reduction in yields following the introduction of integrated ticketing in Auckland - Additional spend on operational efficiency measures ai
Slide 16: NZ Retirement - Metlifecare
NZ Retirement - Metlifecare Solid progress across most KPIs • $8m equity accounted contribution to the group - On track to deliver 200+ units and beds target per annum by FY15 - Result included strong revaluation gains • Current land-bank capable of accommodating 1,000 units and care beds - Greenfie
Slide 17: Capital Expenditure
Capital Expenditure Modest internal capex profile for the 2nd half 30 Sep FY15 • Trustpower – Snowtown II completed in Capex ($Millions) 2014 Outlook September 2014 and acquisition of Green State Power concluded – Trustpower 143.9 155-175 remaining capital spend on ongoing optimisation of NZ hydro f
Slide 18: 2014/15 Outlook
2014/15 Outlook Updated guidance post the sale of the IEA Group 30 Sep 2014 FY 2015 $Millions Actual Outlook(1) EBITDAF – continuing operations 242.5 475-500 Net interest 92.2 165-175 Operating cash flow 122.2 250-280 Depreciation and amortisation 72.0 155-165 (1) Continuing operations based on Z En
Slide 19: Infratil Group - Summary
Infratil Group - Summary Previous divestment bias shifting to origination focus • Strong underlying performance in the portfolio and the sale of Infratil Energy Australia has created significant flexibility for the Group - Following the sale of IEA, Infratil has significant cash balances, no net who
Slide 20: For More Information Go To www.infratil.com
FOR MORE INFORMATION GO TO WWW.INFRATIL.COM Infratil 2014 20
Slide 21: Appendix I – Consolidated Profit & Loss
Appendix I – Consolidated Profit & Loss Group Financial Performance ($Millions) 30 Sep 2014 30 Sep 2013 Operating revenue 852.2 794.4 Operating expenditure (excluding depreciation & amortisation) (609.7) (563.2) EBITDAF (continuing activities) 242.5 231.2 Net interest (92.4) (91.1) Depreciation & am
Slide 22: Appendix II – Adjusted Earnings Reconciliation
Appendix II – Adjusted Earnings Reconciliation Half Year Ended 30 September ($Millions) Sep 2014 Sep 2013 Variance % Change Net Profit after Tax – reported 448.4 277.3 171.1 61.7% • Net (gain)/loss on foreign exchange and derivatives(i) 4.7 (65.5) • Net investment revals, realisations and impairment
Slide 23: Appendix III Z Energy HCA to RC Adjustment
Appendix III Z Energy HCA to RC Adjustment • RC Earnings is a non-GAAP measure used by the downstream fuel industry to measure and report earnings on a replacement cost basis • RC Earnings adjusts purchases of crude and product as if the product sold in a month had been purchased in that month, rath