Cheniere Energy, Inc. · NYSE:LNG
Cheniere Energy — Q3 2019 Earnings Presentation
30 slides from Cheniere Energy's earnings presentation, Nov 1, 2019
Slide 1: Third Quarter 2019 Conference Call
CHENIERE ENERGY, INC. CHENIERE ENERGY, INC. NYSE American: LNG Third Quarter 2019 Conference Call November 1, 2019
Slide 2: Safe Harbor Statements
Safe Harbor Statements Forward-Looking Statements This presentation contains certain statements that are, or may be deemed to be, “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amend
Slide 3: Agenda
Agenda Introduction Randy Bhatia Vice President, Investor Relations Company Highlights Jack Fusco President and Chief Executive Officer Commercial Update Anatol Feygin Executive Vice President and Chief Commercial Officer Financial Review Michael Wortley Executive Vice President and Chief Financial
Slide 4: Operating and Financial Highlights
OPERATING AND FINANCIAL HIGHLIGHTS | Jack Fusco, President and CEO
Slide 5: Third Quarter 2019 Operating and Financial Highlights
Third Quarter 2019 Operating and Financial Highlights Revenues Operations and Commercial Full Year 2020 Guidance Integrated Production Marketing (IPM) ($ billions, except per unit data) 0.85 mtpa – 15 years Consolidated Adjusted EBITDA $3.8 - $4.1 $2,170 $1,819 Distributable Cash Flow $1.0 - $1.3 CQ
Slide 6: Liquefaction Project Operations and Development
Liquefaction Project Operations and Development Construction Update(1) ~60 Million Tonnes >850 Cargoes Exported Since Inception Exported Since Inception Corpus Christi Train 3 project completion 68.6% Target completion moved forward to 1H21 7 Trains Completed Early and Sabine Pass Train 6 project co
Slide 7: 2020 Key Priorities
2020 Key Priorities Corpus Christi Train 3 in foreground Deliver on 2020 Guidance Achieve DFCD for Corpus Christi Train 2 Pursue Additional Development Stable 7-Train operations, with more production Opportunities and Maintain Expected May 2020 Growth Momentum capacity under long-term contracts Leve
Slide 8: Commercial Update
COMMERCIAL UPDATE | Anatol Feygin, EVP and CCO
Slide 9: Supply Growth Continued Pressure on Market Pricing
Supply Growth Continued Pressure on Market Pricing 2019 Incremental Global LNG Supply/Demand Year over Year Supply / Demand Variance 3Q 2018 vs. 3Q 2019 MT MT 14 14 Global Supply LNG Demand LNG Supply 12 Asia Demand 10 12 2.3 8 6 4 (0.7) 10 9.75 2 2.6 0 (1.2) Other -2 1Q 2018 2Q 2018 3Q 2018 4Q 2018
Slide 10: European LNG Imports Decreased From Second Quarter Peak
European LNG Imports Decreased From Second Quarter Peak LNG Imports in Europe Gas Storage in Europe Gas Power Generation in Europe MT 9 % of Full aGWh/d Germany France Italy Spain 100 2000 8 75 1500 7 50 1000 5-Yr Range 25 2019 500 6 2018 0 0 5 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Q3 2018
Slide 11: South East Asia Leading Demand Recovery
South East Asia Leading Demand Recovery Asia LNG Imports Dispersed Coal Heating Replacement Targets MT For 28 cities in North China (unit in household) 25 Million Total Coal Displacement Targets Households 20 6 5.24 5 15 4 3.55 3.62 5-Yr Range 3 2018 2019 10 2 Jan Feb Mar Apr May Jun Jul Aug Sep Oct
Slide 12: Financial Update
FINANCIAL UPDATE | Michael Wortley, EVP and CFO
Slide 13: Third Quarter 2019 Results
Third Quarter 2019 Results Summary Results Three Primary Financial Priorities for 2019 Highlights ($ millions, except per share and LNG data) 3Q 2019 2Q 2019 YTD 2019 YTD 2018 73% of LNG volumes recognized in income in 3Q 2019 (2) Revenues $2,170 $2,292 $6,723 $5,604 from our projects sold under lon
Slide 14: 2019 and 2020 Full Year Guidance
2019 and 2020 Full Year Guidance Full ThreeYear 2019 Financial Primary GuidancePriorities for 2019 2020 ThreeOutlook Primary Financial Priorities for 2019 ($ billions, except per unit data) Stable operations with seven Trains in service through the entire year Consolidated Adjusted EBITDA $2.9 - $3.
Slide 15: Balance Sheet Management and Capital Allocation Update
Balance Sheet Management and Capital Allocation Update Key Achievements Three Primary Financial Priorities for 2019 Project-Level Three PrimaryDebt Maturities Financial Priorities for 2019 CQP issued $1.5B 4.50% Senior Notes due 2029 CCH/CEI $10.0 To term out CQP term loan balance and for general co
Slide 16: Third Quarter 2019 Conference Call
CHENIERE ENERGY, INC. CHENIERE ENERGY, INC. NYSE American: LNG Third Quarter 2019 Conference Call November 1, 2019
Slide 17: Appendix
APPENDIX Uff: if —_— =
Slide 18: Cheniere LNG Exports
Cheniere LNG Exports More Than 850 Cargoes (~60 Million Tonnes) Exported from our Liquefaction Projects London, U.K. Washington, DC Beijing, China Tokyo, Japan Houston, TX Singapore Cheniere LNG Exports by Destination Region MT 10 8 6 4 2 0 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Sources: Ch
Slide 19: Substantial Asset Platform and Global Footprint
Substantial Asset Platform and Global Footprint Building an Industry Leading U.S. LNG Export Platform Sabine Pass Liquefaction Project 27 mtpa(1) Liquefaction Capacity ▪ Trains 1-5 operating, contracts with long-term buyers commenced ▪ Train 6 under construction, est. completion 1H 2023 Corpus Chris
Slide 20: Integrated Platform Creates Commercial Advantage
Integrated Platform Creates Commercial Advantage Market leading position along the value chain GAS SUPPLY LIQUEFACTION PORTFOLIO OPTIMIZATION ▪ Significant consumer of U.S. natural gas ▪ Second largest operator of liquefaction ▪ Loaded over 200 vessels in 2017 and over ▪ Capacity holder on most Gulf
Slide 21: Competitive Differentiators Drive Continued Growth
Competitive Differentiators Drive Continued Growth Over 9 mtpa of long-term deals executed since early 2018 Capitalizing on competitive strengths to provide a differentiated product and underwrite new liquefaction capacity Transaction Features: Liquefaction Capacity ✓ Early Volumes ✓ Delivered Volum
Slide 22: Innovation Brings Continued Commercial Success
Innovation Brings Continued Commercial Success Integrated Production Marketing (IPM) Transactions with Apache and EOG Resources How IPM Works Core Principles ▪ Producers will sell natural gas to Cheniere (Corpus Christi) ▪ Provides producers long-term, reliable market ensuring gas flows ▪ Cheniere w
Slide 23: Sabine Pass Liquefaction Project
Sabine Pass Liquefaction Project Liquefaction Trains 1-5 Trains 1 – 5, Supporting Infrastructure, and ▪ Trains 1 through 5 complete and in operation – all on budget and ahead of schedule Regasification Assets Train 6 ▪ Under construction, expected substantial completion 1H 2023 ▪ Full notice to proc
Slide 24: Corpus Christi LNG Terminal
Corpus Christi LNG Terminal CCL Project Trains 1-3 Train 2 In Operation ▪ Trains 1 and 2 complete and in operation – on budget and ahead of schedule Train 1 ▪ Train 3 is 68.6% complete overall and has a target substantial completion of 1H 2021 In Operation Corpus Christi Stage 3 ▪ Filed FERC applica
Slide 25: Cheniere Corporate Structure
Cheniere Corporate Structure Cheniere Energy, Inc. (NYSE American: LNG) CQP GP Cheniere Corpus Cheniere Marketing (& IDRs) Christi Holdcos(1) Cheniere Energy Corpus Christi Cheniere Corpus Partners, L.P. Liquefaction Christi Pipeline (NYSE American: CQP) Cheniere Creole Sabine Pass Sabine Pass LNG T
Slide 26: Run-Rate Guidance
Run-Rate Guidance 9 Trains (2023) SPL T1-6 ($bn, except per share and per unit amounts or unless otherwise noted) CCL T1-3 CEI Consolidated Adjusted EBITDA $5.2 - $5.6 Less: Distributions to CQP Non-Controlling Interest ($0.9) - ($1.0) Less: CQP Interest Expense/ SPL Interest Expense / Other ($1.1)
Slide 27: Forecasting Points
Forecasting Points Tax Assumptions ▪ Cheniere cash tax payments begin early-mid 2020s ▪ Average tax rate as percentage of pre-tax cash flow: ▪ 2020 – 2030: 0-5% ▪ 2031 – 2040: 15-20% ▪ 2020 – 2030 tax rate primarily due to “80% NOL limitation” on newly-generated NOLs from Tax Cuts and Jobs Act ▪ Che
Slide 28: Cheniere Debt Summary
Cheniere Debt Summary Cash Balance: ~$2.5B(1) Cheniere CCH Holdco II, LLC Cheniere Energy, Inc. $1.6B Senior Secured Convertible Notes Cheniere Energy, Inc. $1.4B PIK Convertible Notes due 2021 (4.875%) (NYSE American: LNG) due 2025 $0.63B Convertible Notes due 2045 (4.250%) Cheniere Corpus Christi
Slide 29: Reconciliation to Non-GAAP Measures
Reconciliation to Non-GAAP Measures Consolidated Adjusted EBITDA Regulation G Reconciliations The following table reconciles our Consolidated Adjusted EBITDA to U.S. GAAP results for the three and nine This presentation contains non-GAAP financial measures. Consolidated Adjusted EBITDA, Distributabl
Slide 30: Investor Relations Contacts
CHENIERE ENERGY, INC. INVESTOR RELATIONS CONTACTS Randy Bhatia Vice President, Investor Relations – (713) 375-5479, randy.bhatia@cheniere.com Megan Light Director, Investor Relations – (713) 375-5492, megan.light@cheniere.com