Origin Energy Limited · ASX:ORG
Origin Energy — Macquarie ASX 100 Conference 2005
32 slides from Origin Energy's conference presentation, May 6, 2005
Slide 1: ASX announcement cover note: presentation to investment community
Origin energy To Company Announcements Office Facsimite 1300 300 021 Company Australian Stock Exchange Limited Date 6 May 2005 From Bill Hundy Pages 32 Subject PRESENTATION Please find attached a presentation to the Investment Community delivered at the Macquarie ASX 100 Conference by Grant King, Ma
Slide 2: Delivering Value for Shareholders in the Australian Energy Sector
drigin energy Delivering Value for Shareholders in the Australian Energy Sector Presentation.to Macquarie ASX 100:Conference one ——""May2005 22
Slide 3: Presentation outline
Presentation outline * Origin’s investment proposition and progress to date ¢ The drivers of Origin’s growth ~ Retail - Exploration and Production ~ Generation ~ Contact « Key issues facing Origin and the energy industry Page 2 Origin.
Slide 4: Origin's investment proposition and progress to date
Origin’s investment proposition and progress to date
Slide 5: Financial objectives and business strategies established in the mid 90s
Origin’s financial objectives and business strategies were established to respond to changes in the energy industry in the mid 90’s..., « Financial Objective ~ Steady and predictable cashflows - EPS growth of 10-15% pa on average « Business Strategy ~ Positioned in the competitive (rather than regul
Slide 6: Implementation of strategy has grown operations and profits
implementation of Origin’s financial objectives and business strategy has grown the company’s operations and profits 2,500 2,000 + 2P Reserves (PJe) up 118% Jun Jun Jun Jun- Jun- 60 o1 02 03 O4 Page 5 | (AW) up 152% Generation Capacity Jun Jun Jun Jun Jun oo ot 02 03 04 EBITDA by Segment (AS, miilio
Slide 7: Increased returns per share over the last four years
Consequently Origin has increased returns per share significantly over the last four years 60 ® CFPS 453 BH EPS « Between listing and June 2004 a 50 || _mDPs Origin’s capital base increased by < 21% as a result of the equity @ 40 - raising in 2001, DRP and employee 8 share plans . 304 « Nonetheless
Slide 8: Significant appreciation in share price and market capitalisation
This has led to a significant appreciation in Origin’s share price and market capitalisation............ Origin Share Price Performance vs ASX 100 (1 March 2000 to 29 April 2005} $8.00 800 & $7.00 + 700 Fi —oRG A 2 oxen ASK 100 * § $6.00 ‘ 600 3 March April = 2 2000 2005 ¥ $5.00 s00 x Market | $0.6
Slide 9: Total Shareholder Return (TSR) 1 March 2000 to 29 April 2005
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Slide 10: Retail
Slide 11: Growth driven by acquisitions and consolidation of energy retailers
Origin’s growth in the past few years has been driven by acquisitions in conjunction with consolidation of energy retailers Eastern Australia Eastern Australia Market share of customers: 1998 Market share of customers: 2003 Origin Energy 16% Origin HM Origin Energy Energy Listed Companies 4% [| Gove
Slide 12: Contestability progressively introduced into Victorian, NSW and SA markets
Contestability has been progressively introduced into the Victorian, NSW and South Australian (SA) markets....... Mass Market Churn: Completed & Pending 45% +4 Pe ssVIC Elec | Vic Gas 40% {A NSW Elec NSW Gas SA Elec camo SA Gas % Churn: Monthly data annualised gee eee STE STE EEE ESP2FSS57K EF FS EB
Slide 13: Origin must significantly reduce its cost to serve
in response to higher churn rates in a competitive market Origin must significantly reduce its cost to serve........ in-House evolution is the preferred path forward Origin. Regerte: Team analysis
Slide 14: Focus on volume, margin and targeting valuable customers
....and focus on volume, margin and targeting valuable customers « Detailed market understanding - through data analysis, segmentation and product development, focussing on high volume / high margin customers « Be competition enabled in all markets - ensure that we are able to compete when, where an
Slide 15: Exploration and Production
Exploration and Production pao vecepenriteres2 Seagate ee
Slide 16: Supply/demand analysis for eastern Australia gas
Origin’s supply / demand analysis for eastern Australia in 2001 showed large uncontracted demand creating perceived shortfall in local supply....... Eastern Australian gas demand Origin Energy estimates 2001 [= Uncontracted +) ME Total Contracted em Total Dearnnd Eastern Australian gas demand (P.3)
Slide 17: Strategy of looking for gas easy to market has grown reserves
Origin’s strategy of looking for gas where it is easy to market, rather than easy to find, has resulted in significant growth in reserves and new contracts....... Grigin Energy Proved and Probable (2P) Reserves 2500 Mi 2P reserves 2600 1500 1000 500 4 Proved and Probable Reserves (PJe} Jun 00 Jun Ot
Slide 18: Major E&P projects
These major E&P projects include the following... ‘Coal seam gas (CSG Perth Basin oil (50%) 3 oil discoveries (1st in basin since 1966) and 5 gas discoveries in last 3 years ¢ Current production exceeds 5,000 bopd net Perth Basin BassGas Project (37.5%) « Gross production per annum: 20 PJ sales gas,
Slide 19: Generation
Slide 20: Forward curve for electricity gives no signal new capacity is required
Current forward curve for electricity gives no signal that new generation capacity is required......... $70 bid ag cS 1 ee uw oc 1 Wholesale electricity price ($/MWh)} Victoria Electricity Prices atu Forward |; Curve end Dec_04 Blot tal lato] Lol at ....2.50 how will new capacity be developed ? Page
Slide 21: Integrated players will most likely drive next round of generation investment
Origin believes it is most likely that integrated players will drive the next round of investment in generation......... Victorian monthly average pool prices and retail tariffs $150 Tariffs in the retail electricity — market are relatively stable $125 e—_ with customers billed quarterly | and price
Slide 22: Further growth in Generation through gas fired plants and renewables
Origin is pursuing further growth in Generation through gas fired power plant development and renewables....... we So Energy Demand nw wa we oS Peak Demand 4,000 ° wa Annual Demand and Generation dispatched (Twh) o a 3,006 2,006 + 1,006 HOrigin Generation Ei Origin Retail Load Peak Demand and Instal
Slide 23: Near term growth driven by internally funded E&P projects
Origin’s near term growth will be driven by expenditure on these E&P projects which can be internally funded Growth capital expenditure compared with calendar 2004 free cash flow (excluding Contact)* 500 456 2004 Calendar Year J free cash flow* 406 c 2 € er = q@ 350 $329 million pw 2 5 3004 c & 256
Slide 24: Contact
Slide 25: Acquisition of Contact Energy diversified geographic reach and skills
The acquisition of a major interest in Contact Energy has diversified the geographic reach and skills in the Origin G rou Pu. Retail and generation coverage across NZ 28% of generation capacity @ 50% thermal Otahuhu B @ 15% geothermal Combined cycle Ctahuhu A ® 35% hydra gas turbine 280MW » Gas turb
Slide 26: Retail prices in NZ have continued to increase
Retail prices in NZ have continued to increase since Origin announced acquisition of an interest in Contact......... . Contact Retail Pricing 1998 - Nov 2004 Simple Average Retail Price in Incumbent Areas* 20 18 . - . | . - y . Vad 12 Pa cikWh 10 8 Apr-98 Apr-99 Apr-O0O Apr-61 Apr-02 Apr-03 Apr-04 *
Slide 27: Key issues facing Origin and the energy industry
Key issues facing Origin and the energy industry piaayesenerritere=23222 mereerameescitayy: nme senor on Jasons:
Slide 28: Major challenges to Origin and the industry going forward
Page 27 So what are the major challenges to Origin and the industry going forward? ¢ Internal to Origin - Operational efficiency and risk management - Project execution - Keeping the opportunity pipeline full e External Economic / price regulation Continued Government ownership of contestable busine
Slide 29: Executive Management Team reorganised to address internal risks
To address the internal risks the Executive Management Team of Origin has been reorganised..... Managing Director & CEO Grant King Chief Operating Officer Austratia Karen Moses, Executive General Manager Exploration Rob Willink rc Executive General Manager, Major Development Projects Andireve Stock
Slide 30: External risks addressed through diversity and natural hedges
External risks are addressed through business diversity, strategic positioning, the development of natural hedges... e Economic / price regulation ¢« Continued Government ownership of contestable businesses e Carbon risk ¢ Supply / demand balance ...and the creation of flexible options to ensure Ori
Slide 31: Delivering Value for Shareholders in the Australian Energy Sector
drigin energy Delivering Value for Shareholders in the Australian Energy Sector : "Presentation to Macquarie. ASX « 100 Conference May 2005
Slide 32: For more information
For more information. For more information on Origin Energy please contact Angus Guthrie Manager, Investor Relations Email: angus. guthrie@originenergy.com.au Telephone: +61-2-8345 5558 Mobile: + 61- 417 864 255 Alternatively visit our website www. originenerey.com.au and follow the prompts to the I