Enn Energy Holdings Limited · HKEX:2688
Enn Energy — Investor Presentation (January 2015)
40 slides from Enn Energy's investor presentation, January 2015
Slide 1: Company Presentation
Company Presentation January 2015
Slide 2: Contents
Contents 1. Our Strategies 2. Financial Highlights 3. Business Review 4. Appendix 1
Slide 3: Our Strategies
Our Strategies 140 city-gas projects with over 61 million connectable urban population City-gas projects Average gas penetration rate of 48.3% Continue organic growth in existing projects and acquire more new projects Acquire industrial parks nearby existing projects Tremendous volume grow
Slide 4: Our Strategies – New Projects
Our Strategies – New Projects Province Project In 1H2014, the Group has secured 6 new projects in China, Industrial Parks Managed by Existing Projects Acquired in 1H2014 spanning across Guangdong, Hainan, Hebei, and Jiangsu, Guangdong Zhaoqing Southern China Renewable providing an additional conne
Slide 5: Our Strategies - Operational Locations
Our Strategies - Operational Locations Beijing Municipality (1 project) 116,000 Inner Mongolia (1 project) Liaoning (4 projects) 767,000 1,144,000 Additional connectable urban population from new projects: Hebei (17 projects) 5,890,000 Shandong (15 projects) 630,000 China 6,354,000 Total connect
Slide 6: Non-residential Natural Gas Price Hike
Non-residential Natural Gas Price Hike On 12 August 2014, NDRC announced another round of city-gate price hike for existing volume in most Pass Through Progress provinces by RMB0.4/m3 (RMB0.12/m3 increase in Price hike since September 2014 Guangdong & Guangxi) effective from 1 September 2014. The
Slide 7: Our Strategies - Vehicle Refuelling Stations in China
Our Strategies - Vehicle Refuelling Stations in China CNG Refuelling Stations LNG Refuelling Stations CNG refuelling stations since 2002 LNG refuelling stations since 2011 No. of new stations in operation 9 No. of new stations in operation 28 Aggregated no. of CNG refuelling stations in Aggregated n
Slide 8: LNG Refuelling Stations Development in China
LNG Refuelling Stations Development in China Riding on supportive government policies and its economic benefits, market potential for LNG refuelling stations is huge Favourable government policy – More 500,000 provincial governments are expected to LNG vehicles adoption and forecast implement poli
Slide 9: LNG Refuelling Stations Market Potential in North America
LNG Refuelling Stations Market Potential in North America Abundant natural gas resources Natural gas price is very competitive Nearly 90% of the natural Natural gas price is cheaper and relatively more stable than oil gas used in the U.S. is price produced in the U.S. and nearly all the remainin
Slide 10: Our Strategies - LNG Refuelling Stations in North America
Our Strategies - LNG Refuelling Stations in North America Improving economics accelerates LNG adoption Retail price of LNG is more stable than diesel Natural gas represents only 1/3 the cost of a DGE of LNG at the pump, the rest is Average life of a heavy duty truck is 5-10 years, payback period
Slide 11: ENN's Competitive Advantage in North America
ENN’s Competitive Advantage in North America 1 Leader in the downstream gas distribution industry for over 20 years, with proven track record and exceptional execution ability Gas sales volume (million cum) 22,966.0 Revenue (RMB million) 11,215.1 8,124.9 4,149.4 471.5 2,056.8 16.9 122.3 2000 2005 20
Slide 12: Future Expansion Strategy in North America
Future Expansion Strategy in North America Develop refuelling network at strategic locations Expand customer & supplier network Our LNG refuelling stations are located in major trucking corridors Continue to sign up customers with guaranteed gas consumption contract More trucking companies and r
Slide 13: Contents
Contents 1. Our Strategies 2. Financial Highlights 3. Business Review 4. Appendix 12
Slide 14: Financial Highlights
Financial Highlights (RMB million) 1H2014 1H2013 Change Revenue 14,351 10,386 38.2% Gross Profit 2,938 2,721 8.0% EBITDA 2,395 2,230 7.4% EBIT 1,982 1,871 5.9% Profit attributable to owners of 1,214 737 64.7% the Company EPS - Basic (RMB) 1.12 0.68 64.8% 13
Slide 15: Revenue Breakdown
Revenue Breakdown 1H2014 7.9% 0.2% 1.3% 14.8% 6.8% 0.3% 1.4% 16.7% 2013 13.4% 12.6% 61.4% 63.2% 2012 5.7% 0.7% 2.3% 20.2% 12.8% 1H2014 1H2013 Core Operating Segments Change % 58.3% (RMB mil) (RMB mil) Gas connection 2,122 1,853 14.5% Sales of piped gas 9,070 6,465 40.3% Gas c onnec tion Vehicle gas
Slide 16: High-Quality Customer Mix (By Revenue)
High-Quality Customer Mix (By Revenue) Residential customers Vehicle gas refuelling stations Commercial / Industrial “C/I” customers Wholesale of gas 1H2014 2013 2012 Gas connection Gas sales 15
Slide 17: Margins Analysis
Margins Analysis During the period, the gross profit margin dropped by 5.7ppts and net profit margin increased by 0.6ppts compared with the same period last year Gross profit margin Net profit margin 20.5% (1H2013: 26.2%) 10.7% (1H2013: 10.1%) Margins analysis Gross profit margin: 1. Continuous im
Slide 18: Financial Resources and Liquidity
Financial Resources and Liquidity (RMB billion) At 30 Jun 2014 At 31 Dec 2013 Change Cash on hand 7.11 6.82 4.3% A/R Days 15 18 (3) Total Debts 12.04 12.44 (3.2)% - Short-term loans 0.69 0.92 (25.0)% - Long-term loans 2.94 3.10 (5.2)% - 10-year bonds 4.54 4.50 0.8% - Convertible bonds 3.87 3.93 (1.5
Slide 19: Refinancing Plan
Refinancing Plan As of 30 Jun 2014 Refinancing Plan (RMB billion) Total Debt 12.04 • We have RMB7.11 billion cash on hand while our working capital demands RMB3-4 billion cash Short-term loans: only, leading to a surplus cash of RMB3.11 billion, which is enough to refinance the short-term Subsidiary
Slide 20: CAPEX
CAPEX 3.57 4 3.15 3.5 2.65 3 2.10 RMB billion 2.5 1.69 1.69 2 1.42 1.28 1.37 1.02 1.5 1 0.5 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 1H2014 The Group had RMB202 million positive free cash flow in 1H2014 (1H2013: RMB78 million positive free cash flow ) More CAPEX may be required depending o
Slide 21: Contents
Contents 1. Our Strategies 2. Financial Highlights 3. Business Review 4. Appendix 20
Slide 22: Key Operational Data
Key Operational Data 1H2014 1H2013 Change Coverage & Gas Penetration Rates of PRC Projects Number of project cities 140 126 14 Connectable urban population coverage ('000) 61,645 57,467 7.3% Connectable households coverage ('000) 20,548 19,156 7.3% Natural gas penetration rate 47.9% 43.8% 4.1% Piped
Slide 23: Key Operational Data
Key Operational Data 1H2014 1H2013 Change Gas Infrastructure Length of intermediate & main pipelines (km) 25,179 22,588 11.5% Natural gas processing stations 141 129 12 Combined daily capacity of natural gas 3 59,298 47,016 26.1% processing stations ('000 m ) Vehicle gas refuelling stations 485 376
Slide 24: Gas Sources
Gas Sources 1. Take-or-pay contracts Signed 15-25 years take-or-pay contracts Take-or-pay Contracts with various pipelines, secured 7,068 million m3 of natural gas supply for 2014 Contracted Supply Contracted Supply Gas Source in 2014 (mil m3) in 2013 (mil m3) 2. Other piped natural gas supply T
Slide 25: Gas Sources
Gas Sources There are over 60,000km of natural gas pipelines and 10 LNG import terminals with total annual receiving capacity of over 56 million tonnes in China currently There are over 100 LNG processing plants in China with a combined daily capacity of over 51 million m3 China continues to e
Slide 26: Contents
Contents 1. Financial Highlights 2. Business Review 3. Our Strategies 4. Appendix 25
Slide 27: ENN Energy – A Leader in the Industry
ENN Energy – A Leader in the Industry ENN Energy (formerly known as Xinao Gas) is one of the first privately-owned clean energy distributor in the PRC. It was founded by Mr. Wang Yusuo and Ms. Zhao Baoju in 1993. In 1998, the Chinese government promoted the use of natural gas and encouraged priv
Slide 28: Gas Delivery Process
Gas Delivery Process Vehicle & ship gas users 27
Slide 29: Immediate Revenue Inflow upon Connection
Immediate Revenue Inflow upon Connection Revenue / Cost Simplified model for a typical matured project Connection fee dominates in early years when the project companies are signing up new customers Gas usage increases as projects mature, becoming the major source of recurrent income Prior to
Slide 30: Operational Locations
Operational Locations Anhui (12 projects) Guangdong (21 projects) Hebei (17 projects) Hunan (cont’d) Liaoning (cont’d) Bengbu 927,000 Dongguan 7,050,000 Baoding 1,200,000 Huaihua 420,000 Huludao 990,000 Zhejiang (cont’d) Bozhou 225,000 Dongyuan 96,000 Gaocheng 180,000 Liling 222,000 Panjing Chemical
Slide 31: New Projects Information
New Projects Information Project Yangxi County Dingan County Changjiang County (陽西縣) (定安縣) (昌江縣) Province Guangdong Hainan Hainan Connectable Population 110,000 100,000 130,000 Stakeholding 100% 60% 60% Operational Location Administrative Region Administrative Region Administrative Region Registered
Slide 32: New Projects Information
New Projects Information Project Ledong County Wangdu Economic Guannan Development Zone (樂東縣) Development Zone (灌南開發區) (望都經濟開發區) Province Hainan Hebei Jiangsu Connectable Population 140,000 NA 150,000 Stakeholding 60% 100% 100% Operational Location Administrative Region Industrial Park Industrial Pa
Slide 33: Connection Fee & Tariff Policy
Connection Fee & Tariff Policy Connection Fee Amortisation: Downstream Tariff Policies: As of 30 June 2014, 12 projects have adopted As of 30 June 2014, we have 35 projects amortisation method: established automatic pass through mechanism Anhui Province - Fengyang and 20 projects established res
Slide 34: Latest Non-residential City-gate Prices in China
Latest Non-residential City-gate Prices in China Province Existing Volume Incremental Volume Province Existing Volume Incremental Volume (RMB/m3 Incl. VAT) (RMB/m3 Incl. VAT) (RMB/m3 Incl. VAT) (RMB/m3 Incl. VAT) Beijing 2.66 3.14 Hubei 2.62 3.10 Tianjin 2.66 3.14 Hunan 2.62 3.10 Hebei 2.64 3.12 Gua
Slide 35: China Natural Gas Industry Overview
China Natural Gas Industry Overview PRC Government’s Commitment to Developing Clean Energy China’s plan to achieve 40–45% reduction in carbon dioxide emission per unit of GDP by 2020 is driving national energy consumption towards cleaner fuels such as natural gas In connection with the 12th Five
Slide 36: Financial Information of North American Business
Financial Information of North American Business ENN US For the year ended 31 December For the nine-month ended 30 September 2012 2013 2014 (unaudited) (audited) (unaudited) (Approximately) (Approximately) (Approximately) RMB’000 RMB’000 RMB’000 Revenue 14,015 23,902 63,340 Gross profit/(loss) 3,162
Slide 37: Approximate conversion factors
Approximate conversion factors Conversion of NG to Fuels other fuels in terms of Coal Fuel oil LPG Diesel Gasoline Electricity same heating capacity Heating capacity 4,500kcal/kg 10,800kcal/kg 11,000kcal/kg 10,400kcal/kg 10,264kcal/kg 860kcal/kWh 1 cubic meter of NG* = 2.0kg 0.83kg 0.82kg 0.87kg 0.8
Slide 38: Awards & Honors
Awards & Honors 2014 All-Asia Executive Team Ranking: 2013 China’s Best CEO Best CEO, Rank no.1 (Power Sector) Forbes 2012 Asia’s Fab 50 Best CFO, Buy Side Rank no.2 & Sell Side Rank no. 3 (Power Sector) China Affiliate of the Best IR Company, Ranked no.2 (Power Sector) Balanced Scorecard “Star Orga
Slide 39: ENN Energy – Share Price Performance
ENN Energy – Share Price Performance Market Capitalization (as at 31 December 2014): HK$47.7 billion 4,500 4,000 ENN Energy 3,500 3,000 2,500 2,000 1,500 Hang Seng China Enterprise Index 1,000 Hang Seng Index 500 0 ENN Energy HSI HSCE 38
Slide 40: Disclaimer
Disclaimer The information provided to you in this presentation does not constitute or form part of any offer for subscription or sale of, or solicitation of any offer to subscribe for or sale of any securities of ENN Energy Holdings Limited (the "Company") nor shall it form the basis of, nor can it
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