Pembina Pipeline Corporation · TSX:PPL
Pembina Pipeline — Shareholder Meeting (May 2021)
21 slides from Pembina Pipeline's shareholder meeting presentation, May 7, 2021
Slide 1: Pembina Pipeline Corporation 2021 Annual Meeting of Shareholders
Pembina Pipeline Corporation 2021 ANNUAL MEETING OF SHAREHOLDERS May 7, 2021 TSX: PPL; NYSE: PBA
Slide 2: Forward-looking statements and information
Forward-looking statements and information This presentation contains certain forward-looking statements and Pembina to maintain current credit ratings; future operating costs which Pembina or one or more of its affiliates has entered into in respect information (collectively, “forward-looking state
Slide 3: Non-GAAP measures
Non-GAAP measures In this presentation, Pembina has used the terms adjusted EBITDA, adjusted EBITDA per common share, fee-based adjusted EBITDA, fee-based distributable cash flow, cash flow after dividends, and funds from operations to debt (“FFO/Debt”); which do not have any standardized meaning un
Slide 4: Highlights since last annual meeting
Highlights since last annual meeting Pandemic • Pembina delivered on the pandemic response plan outlined at last year’s annual meeting Response • Equal focus on our four stakeholder groups: employees, communities, customers, investors Safety • Pembina employees and contractors worked ~9.7 million ho
Slide 5: 2020: pandemic response focused on all stakeholders
2020: pandemic response focused on all stakeholders Employees Communities Customers Investors We let no stakeholder down 5
Slide 6: 2020: pandemic response focused on all stakeholders
2020: pandemic response focused on all stakeholders Employees • Pembina achieved its best safety record ever in 2020 despite pandemic-related challenges • Adapted to new work-from-home requirements • Received overwhelmingly positive response on 2020 employee engagement survey Employees achieved Pemb
Slide 7: 2020: pandemic response focused on all stakeholders
2020: pandemic response focused on all stakeholders Communities • Employed rigorous health and safety measures and adhered to guidance from governments and health authorities • Maintained all pre-pandemic community investment commitments • Pembina’s company-wide United Way campaign raised over $3.2
Slide 8: 2020: pandemic response focused on all stakeholders
2020: pandemic response focused on all stakeholders Customers • Supported their cash flow through uninterrupted service, processing and transporting all product tendered • Based upon strong relationships and an understanding of their needs, struck new ‘win- win’ bargains that were good for customers
Slide 9: 2020: pandemic response focused on all stakeholders
2020: pandemic response focused on all stakeholders Investors • Realized cost savings of $150 million • Deferred $1 billion of capital investment • Maintained BBB credit rating • Secured $800 million of incremental liquidity and termed out additional $1.5 billion of debt • Delivered adjusted EBITDA
Slide 10: Pembina delivers through market cycles
Pembina delivers through market cycles Acquisition Acquisition Acquisition of of Veresen of KML 120 Provident 9 6.00 8 100 5.00 7 80 4.00 6 5 3.00 60 4 2.00 40 3 2 1.00 20 1 0.00 (2) 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021E 0 Financial Crisis Commodity Price Collapse
Slide 11: Diversified and highly contracted
Diversified and highly contracted Commodity Type Fee-for- Crude Oil & Take-or-Pay / Natural Gas Service Condensate Cost-of-Service 17% ~30% ~40% Commodity Exposed(1) 6% Adjusted Adjusted EBITDA EBITDA 2020 77% ~30% NGL Pembina’s business is diversified and supported by take-or-pay contracts, underpi
Slide 12: Financial Guardrails
Financial Guardrails 2020 2021E Maintain target of 80% fee-based contribution to 94% 90-95% 1 adjusted EBITDA(1) Target <100% payout of fee-based distributable 72% 71-75% 2 (61%) (~60%) cash flow (Standard Payout Ratio)(2) 3 Target 75% credit exposure from investment ~75% ~75%(3) grade and secured c
Slide 13: After pandemic 'pause', Pembina has hit 'play' again
After pandemic ‘pause’, Pembina has hit ‘play’ again 1 2 3 4 Post-COVID Rising Global Increased Oil & Demand for Return to Energy Gas Producer Pembina’s Normalcy Demand Activity Services Uncertain timeline Growing demand Advantage Return to but promising for oil & gas and Canada! growth outlook rene
Slide 14: Commodity prices recovering
Commodity prices recovering Q4 April Q3 - Q4 Q1 2019 2020 2020 2021 Oil $55.96 $16.70 $41.79 $57.84 (US$/barrel WTI) Natural Gas (C$/GJ AECO) $2.21 $1.97 $2.33 $2.77 Propane $0.50 $0.33 $0.53 $0.90 (US$/gallon Mt. Belvieu) Condensate $69.97 $26.43 $52.68 $73.47 (C$/barrel) Higher commodity prices le
Slide 15: Strong first quarter results
Strong first quarter results • Base business and marketing business both benefited from higher commodity prices • Reported quarterly adjusted EBITDA of $835 million - excluding the impact of hedging, quarterly adjusted EBITDA reached new record levels • Results reflect an improving business environm
Slide 16: 2021 financial outlook
2021 financial outlook • Adjusted EBITDA of $3.2 - $3.4 billion • 2021 capital program of $785 million - Funded by 2021 cash flow after dividends • At middle to upper end of guidance range can allocate excess cash flow to: - Additional growth opportunities - Debt reduction - Dividend increase - Oppo
Slide 17: Significant backlog of opportunities
Significant backlog of opportunities • Cochin Pipeline expansion • Edmonton Terminals storage expansion • Northeast BC infrastructure solutions • Pipeline laterals and connections • Cogeneration facilities • Petrochemical feedstock solution $4+ billion • Peace Pipeline Phase VIII and IX Expansions •
Slide 18: ESG journey continues
ESG journey continues • Past success tied to strong ESG principles • 2020 Sustainability Report - enhanced disclosure • New Senior Vice President, External Affairs and Chief Legal and Sustainability Officer to lead Pembina’s ESG future • Executive compensation now tied to ESG performance • Signed 10
Slide 19: Prince Rupert Terminal: 'an ESG success story'
Prince Rupert Terminal: ‘an ESG success story’ Before After Transformed an abandoned, contaminated site into an income generating asset benefitting all stakeholders 19
Slide 20: Leverage our past to lead the future
Leverage our past to lead the future Lower Carbon Energy New Opportunities Global Impact Carbon Capture, Wind Cogeneration Hydrogen Liquified Natural Gas Utilization & Storage Pembina Operations Today In Strategy For the Future Pembina is actively working towards a lower carbon economy See "Forward-
Slide 21: Pembina's value proposition
Pembina’s value proposition • Leading provider of essential North American energy services • Decade-long track record of sector outperformance to 2020, now through three crises • Resilient and diverse set of franchise assets and services along the energy value chain • Unparalleled fairway to growth