Keppel Infrastructure Trust · SGX:A7RU
Keppel Infrastructure Trust — HSBC MENAT Future Forum 2024
47 slides from Keppel Infrastructure Trust's conference presentation, Feb 28, 2024
Slide 1: HSBC MENAT Future Forum 2024
HSBC MENAT Future Forum 2024 27 - 28 February 2024
Slide 2: Important Notice
Important Notice NOT FOR DISTRIBUTION OR PUBLICATION, DIRECTLY OR INDIRECTLY IN OR INTO THE UNITED STATES, EUROPEAN ECONOMIC AREA, CANADA, JAPAN, MALAYSIA, THAILAND OR AUSTRALIA The information contained in this presentation is for information purposes only and does not constitute or form part of, a
Slide 3: Outline
Outline ▪ Overview 4 ▪ Proposed Acquisition of Ventura 11 ▪ Growth and Value Creation 22 ▪ FY 2023 Updates 27 ▪ Additional Information 37 Constituent of: Awards and Accreditations1: MSCI Singapore FTSE ST Large Small Cap Index & Mid-Cap Index 1. Keppel Infrastructure Fund Management Pte Ltd is a sig
Slide 4: Overview
Overview European Onshore Wind Platform
Slide 5: Largest SGX-listed Diversified Infrastructure Business Trust
Largest SGX-listed Diversified Infrastructure Business Trust Providing exposure to the resilient and growing global infrastructure sector S$8.1b AUM 13 evergreen businesses >10 mature economies Portfolio of scale providing global and concession assets Focused on investment grade jurisdictions with w
Slide 6: Building the Infrastructural Foundation for a Sustainable Future
Building the Infrastructural Foundation for a Sustainable Future Focus on evergreen, yield accretive businesses and assets that will benefit from secular growth trends 2 WTE plants with combined capacity Capable of processing up to Made headways in the to treat ~40% of Singapore’s 19% of desalinated
Slide 7: FY 2023: Record Year
FY 2023: Record Year Driven by strong portfolio performance from growth and value creation Record EBITDA, Distributable Income and DPU Record EBITDA Record DPU (cents) $447.6m1 6.193 Record DPU 3.72 3.72 Up 11.3%y-o-y 3.78 3.82 62% y-o-y including special FY 2023 Total Returns4 distribution of 2.33
Slide 8: Voluntary Independent Portfolio Valuation
Voluntary Independent Portfolio Valuation Portfolio AUM of $8.1b with new acquisitions and value creation initiatives ▪ Improve transparency and better reflect asset values which are largely recognised at cost in statutory reports ▪ Higher valuation of existing portfolio: $7.4b vs $7.3b for FY 2022
Slide 9: Driving Portfolio Growth through Acquisitions and Value Creation
Driving Portfolio Growth through Acquisitions and Value Creation Well-positioned for growth Expand into transportation infrastructure 2023-2024 milestones Acquisition of Ventura Made 1st solar investment German Solar Portfolio Jan 2024 Jan 2024 Secured concession extension Dec 2023 Dec 2022 Senoko W
Slide 10: Deepen Renewables Exposure with First Solar Portfolio Investment
Deepen Renewables Exposure with First Solar Portfolio Investment Attractive de-risked portfolio backed by 20-year lease contracts with German households ▪ Acquisition of a 45% stake in a German solar portfolio comprising > 60,000 bundled solar photovoltaic (PV) systems, including > 55,000 battery st
Slide 11: Proposed Acquisition of Ventura
Proposed Acquisition of Ventura Ventura
Slide 12: Acquisition of Ventura: A Leading Transportation Business in Australia
Acquisition of Ventura: A Leading Transportation Business in Australia Essential service that supports Melbourne’s population growth and sustainable commute ▪ KIT to acquire approx. 98.6%1,3 interest in Ventura Motors Pty Ltd (Ventura), the largest bus operator in Victoria ▪ Highly accretive acquisi
Slide 13: Ventura: A Century of Service
Ventura: A Century of Service History Victoria’s largest bus operator, providing essential transport services in Melbourne 100 years ~900 bus fleet ~32% A$295m3 Operations (since 1924) including 27 ZEBs1 Market share2 FY 2023 revenue >42m p.a. 12 depots ~100% A$76m3 Passengers transported Serving ~5
Slide 14: Defensive Business with Growth in Private Markets
Defensive Business with Growth in Private Markets > 80% of revenues backed by long-term inflation-protected government contracts with no farebox risk Government Private Mass Transit Public Schools Private Charter Private Schools High frequency services Bus services contracted to Bus services contrac
Slide 15: Key Investment Highlights
Key Investment Highlights Attractive entry point into the transportation infrastructure sector 1 2 3 4 5 6 Largest bus Attractive Defensive Strong and Accretive Electrification operator in market with revenues with proven platform acquisition that theme Victoria with favourable cost indexation of sc
Slide 16: 1. Largest Bus Operator in Victoria with best-in-class performance
1. Largest Bus Operator in Victoria with best-in-class performance Core pillar of Melbourne’s transportation landscape Largest fleet in Victoria ▪ Largest share of public bus No. of buses in Victoria1 912 No. of Public Routes1 services market in Victoria 532 602 589 ▪ Fast-growing private bus 381 ch
Slide 17: 2. Attractive Market with Favourable Tailwinds
2. Attractive Market with Favourable Tailwinds Buses: A critical transport link between Melbourne’s fastest growing regions MELBOURNE Key Growth Drivers Residential Bus reform and development network optimisation Acceleration of Delivery of new commercial and transport Victoria Government routes to
Slide 18: 3. Defensive Cash Flows with Cost Indexation and Capital Reimbursement
3. Defensive Cash Flows with Cost Indexation and Capital Reimbursement Majority of revenues derived from long-term, inflation-protected government contracts Cost-indexed payments > 80% of revenues ▪ Fixed-fee; inflation-protected from MBSC − No farebox / patronage risk − Stable revenue based on serv
Slide 19: 4. Strong Platform of Scale to Capture Growth Opportunities
4. Strong Platform of Scale to Capture Growth Opportunities Pursue growth opportunities within existing business and adjacent verticals Capture upsides within key regions Leveraging technology for vertical and horizontal growth 1 Increase service kilometres 3 Grow new Differentiating 4 and optimise
Slide 20: 5. Accretive Acquisition that Strengthens Portfolio Resiliency
5. Accretive Acquisition that Strengthens Portfolio Resiliency Pro forma DPU to increase by 3.4% based on FY 2023 Distributions Funds from Operations (FFO)2 Enlarged Portfolio: AUM to grow by 7% to 8.7b post-acquisition 6.1% By Business and Assets Assets under Management (AUM) By Geography From $287
Slide 21: 6. Electrification Thematic Supporting KIT's ESG Targets
6. Electrification Thematic Supporting KIT's ESG Targets Clear pathway to electrification KIT’s carbon emissions intensity2 Owns and operates Victoria’s first fully electric bus Carbon emissions (‘000tCO2) / Distributable Income (S$m) depot 8% Key partner in Victorian government’s ZEBs trial, From 6
Slide 22: Growth and Value Creation
Growth and Value Creation German Solar Portfolio
Slide 23: Market Outlook
Market Outlook Infrastructure: Driving Sustainable Development Resilient sector amid market turmoil.. … powered by the Energy Transition sector .. and transit towards the circular economy ▪ Investor appetite for infrastructure ▪ US$4.6 trillion in global energy transition ▪ Continued demand for wast
Slide 24: Continued Focus on Growth
Continued Focus on Growth Leveraging on the Sustainable Urbanisation thematics ▪ Actively pursue third party evergreen businesses Focus on developed markets in APAC and Europe; and yield-accretive investments opportunistic for the rest of the world Optimise portfolio through asset recycling, unlocki
Slide 25: Value Creation a Key Differentiation for KIT
Value Creation a Key Differentiation for KIT Driving growth of businesses through focused portfolio optimisation plans Improve asset performance Business optimisation Realise greater synergies Engineering DNA: Strengthen cash flow profile of existing portfolio ▪ Position City Energy as a ▪ Further s
Slide 26: Drawing on Keppel's Deep Engineering and Operating Capabilities
Drawing on Keppel’s Deep Engineering and Operating Capabilities Operator-oriented DNA: Strong emphasis on value-adding and active management Energy Infrastructure Environmental Infrastructure Global ▪ Developer of Singapore’s 1st independent power project, Keppel Merlimau Cogen (1.3GW) ▪ Keppel's In
Slide 27: FY 2023 Updates
FY 2023 Updates City Energy
Slide 28: Financial Performance at a Glance
Financial Performance at a Glance Achieved Record EBITDA for City Energy, Ixom and Philippine Coastal Energy Transition Environmental Services Distribution & Storage ▪ Higher DI contributed by AGPC and wind ▪ Higher DI supported by full year ▪ Ixom’s EBITDA in AUD up by 5%; lower DI farm assets, and
Slide 29: Business Updates: Energy Transition
Business Updates: Energy Transition ▪ City Energy ̶ Expanded product offerings with the acquisition of TSH’s LPG business, the second largest LPG cylinder distributor in Singapore, allowing City Energy to grow into a new market ̶ Exclusive rights to extend EV charging services to ~20,000 carpark lot
Slide 30: Business Updates: Environmental Services
Business Updates: Environmental Services ▪ EMK ̶ Maintained high availability and full utilisation of incineration capacity ̶ Higher volume for landfill business: Secured new contracts from blue chip customers ̶ Seeking growth opportunities through accretive bolt-on acquisitions ▪ Singapore waste an
Slide 31: Business Updates: Distribution & Storage
Business Updates: Distribution & Storage ▪ Ixom ̶ Strong volume and pricing across coagulants, caustic and sodium hypochlorite in Australia ̶ Increased volume from the industrial and dairy segments of the New Zealand business ▪ Philippine Coastal ̶ Tank utilisation rate of almost 100% as at end-Dec
Slide 32: Distributable Income
Distributable Income S$’000 2H 2023 2H 2022 +/(-) % FY 2023 FY 2022 +/(-) % Energy Transition 50,034 78,916 (36.6) 147,706 115,667 27.7 Record DPU for FY 2023 - City Energy 20,545 26,506 (22.5) 52,730 40,274 30.9 - Aramco Gas Pipelines Company 18,200 26,533 (31.4) 48,817 26,533 84.0 8 Distribution P
Slide 33: Balance Sheet
Balance Sheet Building a strong balance sheet to support growth plans Undrawn committed credit facilities Balance Sheet (S$’m) 31 Dec 2023 31 Dec 2022 $478m Cash 482.6 535.7 Interest Coverage Ratio (MTN) Borrowings 2,717.0 2,907.2 14.7x Net debt 2,234.4 2,371.5 Weighted average interest rate Total a
Slide 34: Capital Management
Capital Management Well-diversified debt maturity profile with healthy capital management metrics ▪ Obtained $100m in corporate loan facilities in 4Q 2023 to support 2024 acquisitions ▪ Reviewing KMC’s capital structure to allow the plant to resume contributions to KIT ▪ Mitigating impact of currenc
Slide 35: Sustainability at the Core
Sustainability at the Core On track to achieve ESG targets ▪ Progressing on decarbonisation roadmap with reduction in carbon emissions intensity and increased exposure to renewables; continue to promote workplace diversity and develop human capital Carbon Emissions Intensity1 Volunteering Hours2 Boa
Slide 36: Thank You
Thank You www.kepinfratrust.com Connect with us on: Borkum Riffgrund 2
Slide 37: Additional Information
ICEPPEL INFRASTRUCTURE TRUST Additional Information
Slide 38: Special Distribution from Successful Value Creation
Special Distribution from Successful Value Creation Crystallised part of value created with $273m capital optimisation arising from EBITDA growth at Ixom and City Energy Driven by higher valuations on strong business and EBITDA growth FY 2023 FY 2022 Feb 2019 2021 Ixom Acquisition EBITDA New strateg
Slide 39: Portfolio Overview: Energy Transition
Portfolio Overview as at 31 Dec 2023 Total Assets1 Description Customer Source of cash flows (S$’m) Sole producer and retailer of piped town gas; expanded Fixed margin per unit of gas sold, > 900,000 commercial and residential City Energy into LPG business, as well as with fuel and electricity costs
Slide 40: Portfolio Overview: Environmental Services
Portfolio Overview as at 31 Dec 2023 Total Assets1 Description Customer Source of cash flows (S$’m) NEA, Singapore government agency - Waste-to-energy plant with 2,310 Senoko WTE concession until 2027 with option for Fixed payments for availability of tonnes/day waste incineration Plant up to 1-year
Slide 41: 2H 2023: Distributable Income
2H 2023: Distributable Income S$'000 Energy Environmental Distribution & Corporate1 Group Transition Services Storage Note: 1. Comprises Trust expenses and distribution Profit after tax 49,182 (12,328) (10,215) 32,397 59,036 paid/payable to perpetual securities holders, management fees and financing
Slide 42: 2H 2022: Distributable Income
2H 2022: Distributable Income S$'000 Energy Environmental Distribution & Corporate1 Group Transition Services Storage Note: 1. Comprises Trust expenses and distribution Profit/(loss) after tax 26,509 (7,549) (37,459) 11,327 (7,172) paid/payable to perpetual securities holders, management fees and fi
Slide 43: FY2023: Distributable Income
FY2023: Distributable Income S$'000z Energy Environmental Distribution & Corporate1 Group Transition Services Storage Note: 1. Comprises Trust expenses and distribution paid/payable to perpetual securities holders, Profit after tax 53,471 (36,201) 26,548 47,109 90,927 management fees and financing c
Slide 44: FY2022: Distributable Income
FY2022: Distributable Income S$'000 Energy Environmental Distribution & Corporate1 Group Transition Services Storage Note: 1. Comprises Trust expenses and distribution paid/payable to perpetual securities Profit after tax (4,065) (9,523) (1,783) 12,542 (2,829) holders, management fees and financing
Slide 45: FY2023: Businesses and Assets Results Summary
FY2023: Businesses and Assets Results Summary City Energy Keppel Merlimau Cogen S$'000 FY2023 FY2022 Change S$'000 FY2023 FY2022 Change % % Revenue 399,532 389,528 2.6 Revenue 130,539 132,226 (1.3) Other income 9,233 1,780 >100.0 Other income 3,687 66 >100.0 Other (losses)/gains - net (139) (216) (3
Slide 46: FY2023: Businesses and Assets Results Summary
FY2023: Businesses and Assets Results Summary Singapore waste and water assets Eco Management Korea S$'000 FY2023 FY2022 Change KRW'm FY2023 2M ended 31 Change % Dec 2022 % Revenue 103,754 103,249 0.5 Revenue 122,200 19,372 >100.0 Other income 1,099 739 48.7 Other income 1,541 575 >100.0 Other (loss
Slide 47: FY2023: Businesses and Assets Results Summary
FY2023: Businesses and Assets Results Summary Ixom A$'000 FY2023 FY2022 Change % Revenue 1,375,623 1,386,745 (0.8) Other income 2,698 192 >100.0 Other (losses)/gains - net 109 465 (76.6) Expenses Operating costs (1,001,962) (1,046,174) (4.2) Staff costs (172,017) (160,383) 7.3 Depreciation and amort
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