Slide 1: Financial results year ended 30 June 2017
financial results year ended 30 June 2017. For personal use only 23 August 2017
Slide 2: 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 Investment Trust (ARSN 115 585 441) (APA Group). For personal use only The information in this presentation does not conta
Slide 3: Results overview and strategic highlights
results overview and strategic highlights For personal use only Mick McCormack Managing Director and CEO. 3
Slide 4: FY2017 highlights
FY2017 highlights $ million FY2017 FY2016 change For personal use only Statutory results Revenue excluding pass-through(1) 1,888.3 1,656.0 Up 14.0% EBITDA 1,470.1 1,330.5 Up 10.5% Net profit after tax 236.8 179.5 Up 32.0% Operating cash flow(2) 973.9 862.4 Up 12.9% Operating cash flow per security (
Slide 5: Investing in Australia's energy future
investing in Australia’s energy future • Solid results, further pipeline of opportunities announced to continue to deliver For personal use only customer-focused energy solutions — Expanded network of integrated assets — Enhanced services offering flexibility and reliability Existing assets $1.2bn o
Slide 6: APA is facilitating cheaper domestic gas on the east coast
APA is facilitating cheaper domestic gas on the east coast For personal use only Interconnected 7,500+ km grid Bi-directional pipelines Capacity expansions -compression & looping Victorian-Northern Interconnect Standardised Information transparency contracts expansions COMMERCIAL Reedy Cre
Slide 7: APA's East Coast Grid delivering gas flexibly to the domestic market
APA’s East Coast Grid is instrumental to flexibly delivering gas to the domestic market For personal use only In Queensland RBP (west) Roma Brisbane Pipeline Existing shipper Existing shipper Facilitating gas fired power Supports gas from Queensland generation QLD to Pelican Point Power Station in S
Slide 8: Partnering with producers to bring gas to market
partnering with producers to bring gas to market • Leveraging the unique capabilities of APA’s East Coast Grid Reedy Creek Wallumbilla Pipeline For personal use only Project description: Domestic gas implications: • 50km, 300TJ/day bi-directional • APLNG able to participate pipeline flexibly and ful
Slide 9: APA's unique power offering
APA’s unique power offering Emu Downs Solar Farm Project description: APA’s unique offering: For personal use only • 20MW solar farm • Adjacent to Emu Downs • $50m cost, incl $5.5m funding Wind Farm and via ARENA grant Badgingarra Wind Farm • Commissioning expected • Shared infrastructure Jan 2018 $
Slide 10: Focused on delivering industry best practice
focused on delivering industry best practice Health and safety For personal use only TRIFR(1) • Continue to target a Zero Harm workplace 40 34.3 • First year of a new 3-year HSE Strategic Improvement Plan 20 • Fatal Risk Protocols workshops completed and 8.11 10.41 7.5 governance group established •
Slide 11: Operational excellence
Operational excellence Enterprise Asset Management For personal use only • Integrated asset management system (performance, safety, risk, compliance) • Informed risk based decision making to sustain and improve asset performance • Standardised processes and systems for managing and maintaining all o
Slide 12: Financial performance
financial performance Peter Fredricson For personal use only Chief Financial Officer 12
Slide 13: Summary results
summary results $ million FY2017 FY2016 Change APA made the following For personal use only Revenue excluding contributions to the 1,888.3 1,656.0 14.0% pass-through(1) broader economy EBITDA 1,470.1 1,330.5 10.5% during FY2017: Depreciation and amortisation (570.0) (520.9) (9.4%) • $995 million EBI
Slide 14: FY2017 result: EBITDA by business segment
FY2017 result: EBITDA by business segment $ million FY2017 FY2016 Change % of FY17 For personal use only EBITDA(1) Energy Infrastructure FY2017 EBITDA Bridge Queensland 925.4 855.8 8.1% 60.2% $139.6m New South Wales 149.5 121.7 22.8% 9.7% $1,470.1m Victoria & 3.1% South Australia 125.3 123.1 1.8%
Slide 15: Low risk business model
low risk business model • APA has robust risk management processes in place For personal use only • Continue to manage counterparty risks by: Diversification of customer & industry exposure Assessment of counterparty creditworthiness Entering into long term contracts to support major capital s
Slide 16: Capital expenditure and investment cash flows
capital expenditure and investment cash flows $ million FY17 FY16 6,000 1,600 Growth capex For personal use only 6,284.4 Acquisitions & other Regulated – Victoria 106.1 130.9 1,400 A$ m investment cash 6,000 6,000 flows Non-regulated 1,200 6,000 Growth capex East Coast 78.7 18.8 1,000 Western Austra
Slide 17: Growth projects – $1.2bn announced to date
growth projects – $1.2bn announced to date • $200m in incremental revenue to be delivered in FY20 through new projects Capex Pipeline projects Renewables projects Midstream projects For personal use only Projects FY17 1H FY18 2H FY18 1H FY19 2H FY19 1H FY20 2H FY20 Customer FY17 (incl. VNIE, excl. $
Slide 18: Capital management
capital management For personal use only • Cash and committed undrawn facilities of over $1.46 billion as at 30 June 2017 to meet the continued capital growth needs of the business • Credit ratings: S&P BBB (outlook Stable, confirmed Dec 2016), Moody’s Baa2 (outlook Stable, confirmed Mar 2017) • Maj
Slide 19: Debt maturity profile
debt maturity profile APA maintains diversity of funding sources and spread of maturities For personal use only Note: (1) USD denominated obligations translated to AUD at the prevailing rate at inception (USD144A - AUD/USD=0.7879, EMTN & Sterling - AUD/USD=0.7772) (2) Subordinated Notes first call d
Slide 20: Fully covered distributions
fully covered distributions Franking Credits For personal use only • FY2017 distribution payout ratio(1) of 49.8% • APA cash tax payer - calendar year 2017 • Components for FY17 distribution: • Franking credits of 2.0 cents per security 15.05 cents APT profit distribution allocated to the final APT
Slide 21: FY18 guidance
FY18 guidance • Based on current operating plans and available information, EBITDA for FY2018 is expected to be in the For personal use only range of $1,475 million to $1,510 million • Net interest costs for FY2018 expected within a range of $525 million to $535 million • Distributions per security
Slide 22: Outlook: industry background & APA strategy
outlook industry background & APA strategy For personal use only Ross Gersbach Chief Executive Strategy & Development. 22
Slide 23: Energy policy update
energy policy update • Gas will continue to be an essential fuel in • Finkel Report (June 2017) noted that: Australia’s energy mix, as a cleaner, ― gas can support variable renewable electricity For personal use only abundant fuel source generation and also contribute to emissions reduction • Gas pr
Slide 24: Pipeline information disclosure and arbitration framework
pipeline information disclosure and arbitration framework • Amendments to National Gas Rules came into effect 1 August 2017, to implement GMRG developed For personal use only information disclosure and commercial arbitration regime for unregulated pipelines. • Pipeline disclosure requirements ― Incl
Slide 25: APA's strategy
APA’s strategy APA is committed to delivering energy solutions that are East coast gas demand & production by field safe, reliable, innovative and cost-effective. For personal use only • Our growth focus is to enhance our portfolio: ― of gas transmission pipelines; ― of power generation: gas-fired a
Slide 26: Supplementary information
supplementary information For personal use only 26
Slide 27: Snapshot of APA
snapshot of APA Australian gas transmission pipeline ownership by kilometres APA Overview (Ticker: APA AU) For personal use only ~ APA is Australia’s largest gas pipeline owner ~ Market cap A$ 9.37 billion (as at 22 Aug 2017) ASX rank S&P/ASX 50 Credit rating Moody’s: Baa2 (outlook Stable) S&P: BBB
Slide 28: Group structure
group structure • APA is a stapled structure comprising two For personal use only registered managed investment schemes: Australian Pipeline Trust (ARSN 091 678 778) APT Investment Trust (ARSN 115 585 441) is a pass-through trust • Australian Pipeline Limited (ACN 091 344 704) is the responsible
Slide 29: Solid historical performance
solid historical performance $1,600m $1,200m Normalised EBITDA $1,470 Normalised operating cash flow $1,400m $1,000m For personal use only $1,331 $974 $1,200m $862 $800m $1,000m $800m $600m $822 $747 $545 $600m $662 $400m $433 $440 $535 $490 $400m $460 $336 $290 $268 $200m $200m $0m $0m FY10 FY11 FY
Slide 30: FY2017 operational summary – Energy Infrastructure
FY2017 operational summary – Energy Infrastructure Wallumbilla Gladstone Pipeline South West Queensland Pipeline Roma Brisbane Pipeline Carpentaria Gas Pipeline Diamantina Power Station Other Qld assets Moomba Sydney Pipeline Victorian Transmission System For personal use only SESA Pipeline Amadeus
Slide 31: FY2017 operational summary – Asset Management, Energy Investments and Corporate costs
FY2017 operational summary – Asset Management, Energy Investments and Corporate costs 80 A$ m Asset Management EBITDA For personal use only Asset Management 70 One-off • Connections continued to grow, however lower tariffs 60 Customer due to new SA access arrangement from July 2016 Contributions 50
Slide 32: Debt facilities
debt facilities Total committed debt facilities at 30 June 2017 For personal use only $ million Facility Drawn Tenor amount amount 2015 & 2016 Bilateral bank facilities 550 - 2 to 5 year facilities maturing between May 2018 to May 2021 2015 Syndicated bank facilities 519 - 3.25 and 5.25 year tranche
Slide 33: Regulatory update
regulatory update • Approximately 9.4% of APA’s Energy Infrastructure revenue in FY17 was regulated revenue For personal use only • APA’s major regulatory resets over the next few years are as follows: • Victorian Transmission System access arrangement review A draft decision by the AER on APA’s a
Slide 34: Economic regulation of gas pipelines and networks
economic regulation of gas pipelines and networks Regulator • The Australian Energy Regulator (AER) is responsible for the economic regulation of gas transmission and distribution networks and enforcing the National Gas Law and National Gas For personal use only Rules in all jurisdictions except Wes
Slide 35: For further information contact
For personal use only For further information contact: Yoko Kosugi Jennifer Blake Head of Investor Relations Investor Relations Manager Tel: +61 2 9693 0049 Tel: +61 2 9693 0097 E-mail: yoko.kosugi@apa.com.au Email: jennifer.blake@apa.com.au Or visit the APA website at: www.apa.com.au 35
Slide 36: APA's uniquely integrated energy infrastructure
APA’s uniquely integrated energy infrastructure For personal use only Assets and Investments Glossary AGPGLOS Amadeus Gas Pipeline BGP Bonaparte Gas Pipeline BWF Badgingarra Wind Farm BWP Berwyndale Wallumbilla Pipeline CGP Carpentaria Gas Pipeline CRP Central Ranges Pipeline & distribution network