Apa Group · ASX:APA
Apa — Macquarie Securities Australia Conference 2009
22 slides from Apa's conference presentation, May 7, 2009
Slide 1: Macquarie Securities Australia Conference
Macquarie Securities Australia Conference Ross Gersbach, Chief Financial Officer Sydney, 7 May 2009
Slide 2: APA Group overview
APA Group overview APA is Australia’s leading gas transmission and distribution infrastructure owner and operator – Gas transmission and distribution: gas pipelines, interconnected gas storage facilities across Australia, and gas distribution networks in Queensland and New South Wales – Asset Mana
Slide 3: High quality gas infrastructure portfolio
High quality gas infrastructure portfolio Australia has an abundance of natural gas reserves – 56,700 PJ of 2P reserves, with almost half (26,100 PJ) in eastern Australia Increasing demand for gas – particularly gas fired power generation APA delivers gas from all major gas production sources
Slide 4: APA's strengths
APA’s strengths Unrivalled gas asset footprint – largest gas transporter of natural gas across Australia by pipeline length, capacity and volume Integrated portfolio of gas pipeline assets – providing revenue and operating synergies Attractive growth opportunities – enhancing capacity in APA’s
Slide 5: APA's strategy
APA’s strategy Maximise value for securityholders by Focusing on gas infrastructure assets in Australia’s growing gas market and further enhance APA’s portfolio of assets Capturing revenue and operational synergies from APA’s significant asset base Pursuing opportunities that leverage APA’s kn
Slide 6: Proven financial performance
Proven financial performance EBITDA Operating cash flow 500 200 192 450 431 180 400 160 350 140 123 300 120 249 $m $m 250 100 200 80 150 60 100 40 50 20 0 0 FY2004 FY2005 FY2006 FY2007 FY2008 HY2009 FY2004 FY2005 FY2006 FY2007 FY2008 HY2009 Operating cash flow per security Distributions per security
Slide 7: Strong performance in 1H09
Strong performance in 1H09 Financial highlights Underlying revenue (excluding pass-through) $368 million, up 20% Underlying EBITDA $249 million, up 16% Underlying operating cash flow $123 million, up 12% Underlying operating cash flow per security 25.8 cents, up 3.3% Distribution 15.0 cent
Slide 8: Stable and secure revenue
Stable and secure revenue More than 90% of APA’s revenues are derived from price regulated (natural monopoly) assets and long-term contracts Tariffs are set by regulation for price regulated assets, but existing contract terms remain Tariffs commercially negotiated for all other pipelines and
Slide 9: Regulatory overview
Regulatory overview Regulatory resets are spread out over five years, with on average one reset per year – Next major asset reset is 1 January 2010 – Goldfields Gas Pipeline AER Review of WACC for regulated electricity transmission & distribution: – Regulated electricity assets, not gas. – Decis
Slide 10: Diversified customer base
Diversified customer base APA’s revenue stream is diversified across customers and FY08 revenue (excluding pass-through) industries by customer type 5% Other Customers are among the largest Government 5% in the energy market and include businesses BHP (A+), Origin Energy (BBB+) and AGL Energy (B
Slide 11: Integrated pipelines facilitate retail market dynamics
Integrated pipelines facilitate retail market dynamics Small number of retailers across east Australian gas and electricity markets – Three largest retailers (excluding NSW electricity) supply majority of the East Australian retail market Retailers’ gas portfolios are diversified across gas basi
Slide 12: Increased demand for natural gas
Increased demand for natural gas Natural gas and Australian primary energy consumption Growth rates It is estimated that Australia’s underlying 7.0% gas demand will grow an average of 4%* 6.0% annually over the next 10 years. Key Natural gas Total 5.0% growth drivers include: 4.0% – Greater use of
Slide 13: Increased pipeline capacity requirements for power generation
Increased pipeline capacity requirements for power generation APA primarily sells pipeline capacity – Gas fired power generation requires pipeline capacity and gas throughput: Baseload generation – capacity and gas volumes throughout the year Peak/intermediate generation – capacity and storage
Slide 14: Capital expenditure and timing is discretionary
Capital expenditure and timing is discretionary APA has a low level of stay-in-business capex which is required annually – up to $20 million per annum – Bulk of the assets are underground and require a minimal level of maintenance capex – APA controls the timing of non-critical capex APA maintai
Slide 15: Secure long term debt portfolio
Secure long term debt portfolio Cash and committed undrawn facilities of $710 million at 31 December 2008, with $300 million MTN repaid in March 2009 Recent debt raising experience – $165 million bilateral debt facility - August 2008 – $538 million of non-recourse debt raised for EII – December
Slide 16: Capital management and refinancing
Capital management and refinancing Debt maturing in the next 18 months: – $900 million syndicated bank facility – June 2010 – $102 million USPP 2003 Tranche A – September 2010 Refinancing strategy – Access diverse markets and broader range of financing options – Reduce discretionary capital expe
Slide 17: Summary
Summary APA continues to deliver value to its securityholders through growth in distributions and operating cash flow Quality portfolio of gas infrastructure assets throughout Australia Direct management and operational control over APA’s assets and investments delivers further value to the bu
Slide 18: Supplementary information
Supplementary information May 09 Æ 18
Slide 19: APA's gas infrastructure business
APA’s gas infrastructure business May 09 Æ 19
Slide 20: APA business segments
APA business segments FY2008 EBITDA % 1 Australia’s largest gas pipeline owner, present in each mainland state and territory APA manages and operates all its major gas transmission and distribution assets Gas transmission pipelines: 79% – Approximately10,000 km of high pressure gas transmissio
Slide 21: Disclaimer
Disclaimer The information contained in this presentation is given without any liability whatsoever to Australian Pipeline Trust or APT Investment Trust or any of its related entities (collectively “APA Group”) or their respective directors or officers, and is not intended to constitute legal, tax o
Slide 22: Delivering Australia's energy
Delivering Australia’s energy For further information visit APA’s website www.apa.com.au May 09 Æ 22
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