Chesapeake Utilities Corporation · NYSE:CPK
Chesapeake Utilities — Q1 2021 Earnings Presentation
22 slides from Chesapeake Utilities's earnings presentation, May 6, 2021
Slide 1: First Quarter 2021 Earnings Call
Exhibit 99.1 First Quarter 2021 Earnings Call May 5, 2021Exhibit 99.1 First Quarter 2021 Earnings Call May 5, 2021
Slide 2: Presenters
Jeff Householder President & CEO Presenters Beth Cooper Executive Vice President, CFO and Asst. Secretary Jim Moriarty Executive Vice President, General Counsel , Corporate Secretary and Chief Policy and Risk Officer 2Jeff Householder President & CEO Presenters Beth Cooper Executive Vice President,
Slide 3: Forward Looking Statements and Other Disclosures
Forward Looking Statements and Other Disclosures Safe Harbor Statement Some of the Statements in this document concerning future Company performance will be forward-looking within the meanings of the securities laws. Actual results may materially differ from those discussed in these forward-looking
Slide 4: First Quarter 2021 Financial Performance Key Highlights
First Quarter 2021 Financial Performance Key Highlights Return to more normal Acquisitions (Elkton and Expansion projects, customer weather and customer growth, and pipeline replacements Western Natural Gas) added consumption for the quarter generated $4.1 million in additional $1.8 million in incre
Slide 5: Growth in Earnings Drives Dividend Growth
Growth in Earnings Drives Dividend Growth Annualized Dividends Annual Growth 2021 9.1% Five Year Growth – 2021 is 9.5% $2.00 $1.92 $0.16 $1.76 $1.80 $1.62 $0.14 $0.14 $1.60 $1.48 9.1% $0.18 $1.40 $1.30 8.6% $0.08 $1.22 9.5% $1.20 13.8% $1.00 6.6% $0.80 $0.60 $0.40 $0.20 $- 2016 2017 2018 2019 2020 2
Slide 6: Financial Summary: Quarters Ended March 31, 2021 and 2020
Financial Summary For the quarters ended March 31, 2021 and 2020 First Quarter (in thousands except per share data) 2021 2020 17.1% Total Gross Margin $ 116,890 $ 99,820 22.5% Operating Income $ 51,597 $ 42,134 Other Income, Net 385 3,319 Interest Charges (5,105) (5,814) Pre-tax Income 46,877 39,639
Slide 7: Financial Summary: Operating Results for 2021 and 2020
Financial Summary Operating Results for 2021 and 2020 Chesapeake Utilities is committed to Gross Margin Growth through efficient operations. • Gross Margin increased $17.1M or 17.1% compared to Q1 2020 ✓ 14.7% Growth in Regulated ✓ 22.0% Growth in Unregulated • Operating income increase 22.5% ✓ 17.8
Slide 8: Key Drivers of Our Performance
Key Drivers of Our Performance Quarter Ended March 31, 2021 Earnings per share drivers EPS after-tax • Gross Margin (Net) $10.4M $0.60 • 2020 Property Sales ($2.3M) ($0.14) • Other (Net) $0.9M $0.05 • Depreciation and Amortization ($1.3M) ($0.07) • Operating expenses (Net) ($2.3M) ($0.13) • Stock Is
Slide 9: Capital Expenditures Forecast
Capital Expenditures Forecast Still on Track with 2021 Initial Guidance F orecast 2021 (dollars in thousands) Low Hi gh Regul ated Energy : Natural gas distribution $ 79,000 $ 85,000 Natural gas transmission 55,000 60,000 Electric distribution 9,000 13,000 Total Regulated Energy 143,000 158,000 82%
Slide 10: Capital Structure Overview
Capital Structure Overview Strong Balance Sheet to Support Growth 03/31/21 12/31/2020 Long-Term Debt Stockholders‘ equity $ 7 26,388 $ 697,085 Avg. Interest Long-term debt, net of current maturities 5 08,525 508,499 Rate - 3.62% Total permanent capitalization $ 1 ,234,913 $ 1 ,205,584 Short-Term Deb
Slide 11: 2021 – 2025 Strategic Growth Initiatives
Chesapeake Utilities 2021 – 2025 Strategic Growth Initiatives Key 2021-2025 Strategic Initiatives Optimize the earnings potential Renewable Natural Pursue interstate Expand Marlin Gas in our existing Further expansion Gas (RNG) and intrastate Services Virtual businesses through of our propane opport
Slide 12: Major Initiatives
Major Initiatives DELMARVA AND FLORIDA COMMUNITY GAS DISTRIBUTION SYSTEM ORGANIC GROWTH AND SYSTEM CONVERSIONS IMPROVEMENT PROJECTS PIPELINE EXPANSIONS CUSTOMER GROWTH, AUTOGAS, ACQUISITIONS RNG COLLABORATIONS SAFETY TOWN INFRASTRUCTURE STATE OF THE ART MARLIN INVESTMENT TRAINING CENTER TRANSPORT (V
Slide 13: Major Projects and Initiatives Margin Contribution
Major Projects and Initiatives Margin Contribution Three Months Ended Year Ended Estimate for March 31, December 31, Fiscal in thousands 2021 2020 2020 2021 2022 Pipeline Expansions: Western Palm Beach County, Florida Expansion $ 1,167 $ 1,000 $ 4,167 $ 4,984 $ 5,227 Del-Mar Energy Pathway 884 189 2
Slide 14: Renewable Investment Opportunities
Renewable Investment Opportunities Renewable energy projects that meet Either regulated foundational our fundamental strategic objectives and investments or related non-regulated financial discipline standards investments that offer the opportunity for (returns/risk profile). returns above our regul
Slide 15: Driving Sustainability Efforts at State Level
Driving Sustainability Efforts at State Level Example – Recent Florida Activity • Energy Preemption bill: • Filed by the Florida Natural Gas Association (FNGA). • Has cleared both chambers and is waiting on signature from the Governor. • Restricts local governments from limiting energy choice for co
Slide 16: ESG Stewardship
ESG Stewardship • We take seriously our responsibility to be a good, trusted and ethical corporate citizen, and doing all we can to contribute, through investment, charitable contributions and volunteerism, to greater sustainability, environmental benefits and societal advancement. • For more than 1
Slide 17: ESG Stewardship
ESG Stewardship Earth Day Lineworker Appreciation Day Together, the Chesapeake Utilities Team PROUDLY DELIVERS UNINTERRUPTED ENERGY SERVICES TO OUR CUSTOMERS Happy Ramadan • We have an unwavering focus on advancing initiatives that are consistent with our long- history of growth, upper-quartile perf
Slide 18: Committed to equity, diversity and inclusion
Committed to equity, diversity and inclusion Embracing a Culture where all are welcome Corporate Culture Awarded a top work place for 9 consecutive years and national top work place in 2021 29 safety achievement awards Through our 10-year Aspiring Scholars Program, 111 Chesapeake children of Company
Slide 19: Capital Investment Guidance
Capital Investment Guidance Continued Record Investment in Our Business Growth $1,000,000 Total $900,000 $1 billion Dollars in Thousands $250 million $800,000 Unless Otherwise Noted Reach $1 billion $700,000 Total $600,000 $750 million $500,000 Reach $750 million $400,000 $562.5 $677,722 million $30
Slide 20: Diluted Earnings per Share Guidance
Diluted Earnings per Share Guidance Continuing Operations Strategic Capital Investments Continue to Drive Earnings Growth 8-Year CAGR EPS Growth 9.7% to 10.1% $6.25 $6.05 5-Year CAGR EPS Growth 10.2% - 11.1% $4.90 $4.70 $4.21 $3.72 $3.47 $2.89 * 2017* 2018 2019 2020 ---2022-- ---2025-- *2017 Adjuste
Slide 21: Investment Proposition
Investment Proposition Committed to Superior Performance We seek to identify and develop opportunities to drive our future earnings growth and increase shareholder value. ▪ Capitalizing on new organic growth and operational Strong Foundation for Growth: efficiencies ▪ Track Record ▪ Investing in pip
Slide 22: Thank You
Standing Strong. Embracing Change. Shaping Our Future. Thank You 5