Origin Energy Limited · ASX:ORG
Origin Energy — Morgan Stanley Asia Pacific Summit 2003
25 slides from Origin Energy's conference presentation, Nov 4, 2003
Slide 1: Presentation to Asia Pacific Summit (ASX cover note)
Origin energy To Company Announcements Office Facsimite 1300 300 021 Company Australian Stock Exchange Limited Date 4 November 2003 From Bill Hundy Pages 25 Subject | PRESENTATION TO ASIA PACIFIC SUMMIT Please find attached a copy of a presentation that Grant King, Managing Director is delivering to
Slide 2: Strategy, Performance, and Growth: Delivering Value for Shareholders
Or SIN Strategy, Performance, and Growth Delivering Value for Shareholders . Morgan Stanley Asia Pacific Summit, Singapo = November 2003
Slide 3: A growing market and a growing company
End use sales of electricity, gas, and related products and services in Australia exceeds A$32 billion per annum and has been growing steadily as energy consumption increases. Australian End Use Energy Sales A GROWING MARKET * Growth in domestic demand for energy has averaged over 4% per annum over
Slide 4: Business strategy: position in competitive segments of energy markets
Origin’s business strategy is to position in the competitive (rather than regulated) segments of the energy markets...... Structure of the Australian Gas and Electricity Industry || Coal &oil - Wholesale pool | Contestable segment _| Origin participation Regulated segment Physical contracts Retaii m
Slide 5: Effective strategy implementation has resulted in strong growth
The effective implementation of this strategy has resulted in strong growth in the company’s operations and profits 2,500 2.2 2P Reveves (PJe) Customers (millions) 2,000 7 Up ( 2.0 5 ry i EBITDA by Segment (A$, millions) up 67% 1,500 4 500 8) 450 + 1.6 4 1,000 + 400 5 350 1.44 500 4 300 5 250 | 1.24
Slide 6: Earnings per share has grown 86% through the last three annual results
Earnings per share has grown 86% through the last three annual results (CAGR 23%) 60 54 ¢ Origin’s capital base has increased by 16% following the equity raising in 2001, DRP and employee share plans 50 = |@ CFPS GEPS @ DPS 40 + « Nonetheless EPS has increased 23% 30 4 on a compound basis ¢ Cash flo
Slide 7: Growth has required significant capital expenditure
This growth has required significant capital expenditure. Acquisitions in Retail and generation have provided immediate contributions........ Jun 00 Jun 01 Jun 02 Jun 03 ($m) ($m) ($m) ($m) Growth & Acquisitions E&P 47 56 129 179 Retail 1 342 78 154 Generation 70 46 116 93 Networks 15 0 15 0 Corpora
Slide 8: Capital expenditure funded from strong cash flow
This capital expenditure has been funded from Origin’s strong cash flow.......... + Jun 00 Jun 01 Jun 02 Jun 03 ($m) ($m) ($m) ($m) EBITDA 271 305 405 491 Non-cash items (8) (8) (17) 13 Change in Working Capital (20) 11 16 39 Stay in business CAPEX (67) (83) (65) (94) Tax/Subvention Payments (36) (2
Slide 9: Conservatively geared balance sheet
seseneens .and conservatively geared balance sheet Jun 00 Jun 01 Jun 02 Jun 03 Net debt ($m) 431 727 633 732 Total equity ($m) 1,240 1,328 1,626 1,790 Net debt to equity (%) 35% 55% 39% 41% Net interest expense ($m) (30) (32) (43) (49) Net interest cover (x EBIT) 4.4 5.5 5.4 6.1 Average interest rat
Slide 10: Growth projects requiring capital expenditure of $1.4 billion
In the medium term growth projects requiring capital expenditure of $1.4 billion are already being developed...... e Current free cash flow will cover the majority of the capital required for this FY '03 Free Cash Flow $350 mill. pa organic growth ¢ Conservative gearing (net 200 4 Estimated Capital
Slide 11: Major projects in the capital expenditure program
Major projects in this capital expenditure program include the following............ Coal Seam Gas Perth Basin Quarantine SEA Gas Pipeline FRC Projects Offshore Otway Basin BassGas Project Perth Basin Oil (50%) 3 oil discoveries (1st in basin since 1966) producing 3,000 bopd net, +2004 target 5,000
Slide 12: Total Shareholder Return, 1 March 2000 to 30 October 2003
dnoig saryiedoig o.QueD pat Aemaw-dioouns Annualised TSR 49% 38% 23% 15% 10% -6% P77 S8UIp}oY suadedsman URLE.YSNY seM Origin P97 SBUIPIOH WAOMION UO, £ 4 djop Buryueg sedysoy | ‘€ pan dod spied c Be Zz Py] BuO -— a oe a R Py] yueg aB40aD IS 4) S254 5 2 7 eu Y 2 z w s Py] euRuNy om uw 3 3 % py] soow
Slide 13: Opportunities for Further Development
j Or isin Opportunities for Further Development 2
Slide 14: Continuing opportunities for new developments in Australian energy
Longer term the energy industry in Australia provides continuing opportunities for new developments ¢« Upstream - Perth Basin - Offshore Otway and Bass Basins - Surat Basin / Myall Creek - Coal seam gas (CSG) Coal Seam Gas Perth Basin « Retail stone - Further consolidation isbane - Margin growth e G
Slide 15: Otway Basin, offshore Victoria
Otway Basin, offshore Victoria New infrastructure and acreage awards are opening up opportunities in the Otway and Bass Basins ¢ Following the Thylacine and Geographe gas discoveries the offshore Otway has attracted many new players ¢ Prospectivity centres ona reservoir fairway known as the Shipwrec
Slide 16: North Perth Basin, onshore Western Australia
North Perth Basin, onshore Western Australia la 1 co'Mtt Oe. 14 50 008 15 02 oe Us OE EP h os No 5 jira (5.0%) ray Nl {1.278%} | Arc Energy NE (0.25%) H Roe Oil (0.25% f te wa |S Geary (0.142%) { i [] Existing 3D Seisinic KILOMETRES, v L 02-6 PLORATION WELL TS ou OE 1 10 06 Page 15 An emerging oil p
Slide 17: Surat Basin, onshore south east Queensland
New play opportunities have provided the largest discovery in over a decade in the Surat Basin Recent successes in the Surat Basin suggest a large gas resource may be stratigraphically trapped at Myall Creek in the Permian Tinowon Fm. A further 4 wells will be drilled starting in September, and 3D s
Slide 18: Leading position in commercialisation of CSG resources
Origin has established the leading position in the commercialisation of CSG resources in Australia 2,000 Coal Seam Gas Reserves In Queensland @ 4,800 $ 5 Others g @ Origin © 4.000 & o o & § 500 a N 0 1996 © «1997 1998 «= 1999 20002004 += 2002-2003 Queensland supply/demand balance for natural gas i U
Slide 19: Retail: opportunities to build scale
In Retail, opportunities exist to build scale through market growth/consolidation and margin expansion Eastern Australian energy retailers: market share by energy accounts =. + Deregulation and privatisation of the 7 energy markets has proceeded in Victoria and South Australia, but remains stalled i
Slide 20: Generation business grown to 883 MW
Origin has grown the Generation business from a few MW in 1998 to 883 MW of gas turbine & cogeneration plant ind ° ; 4,000 e Over 530 MW is contracted to Energy Peak 34 parties, while 250 MW is Demand Demand contracted to the Retail see ae division through a tolling arrangement, offsetting less than
Slide 21: Portfolio of renewable generation projects
Origin has established a portfolio of renewable generation projects that provide value in an uncertain environment Renewables - MRET’GWh __ + Solar: Origin SLIVER® Solar Cell Possible requirements technology tested and commercial viability established. Planning for pilot plant well advanced e Wind:
Slide 22: Investing in regulated assets through Envestra holding
Origin does not own regulated assets but invests in them through its 19% holding in Envestra and manages assets on behalf of third parties. Assets continue to churn in this e Aquila / UEL / Alinta transaction in early 2003 e EPIC is in the process of selling pipeline assets in Western Australia and
Slide 23: Origin will continue to deliver value to shareholders
Origin will continue to deliver value to shareholders through: ¢ A strategic position that has differentiated Origin from other energy companies in Australia ¢ A focus on risk management and improving the performance of existing businesses ¢ Growth from prospects generated within the business and ac
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Slide 25: 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 Office: +61-2-9220 6558 Mobile: + 61-4-1786 4255 Fax: +61-2-9235 1661 Alternatively visit our website www.originenergy.com.au and follow the p
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