Chesapeake Utilities Corporation · NYSE:CPK
Chesapeake Utilities — FY2020 Earnings Presentation
25 slides from Chesapeake Utilities's earnings presentation, Feb 26, 2021
Slide 1: Fourth Quarter and Year-End 2020 Earnings Conference Call
Commitment Growth Leadership Safety Sustainability Solutions Driven ByEnergy Strength Team Service Fourth Quarter and Year-End 2020 Earnings Conference Call February 25, 2021 Performance Community Value Chesapeake Utilities Corporation Exhibit 99.1
Slide 2: Presenters
Jeff Householder President & CEO Beth Cooper Executive Vice President, CFO and Asst. Secretary Jim Moriarty Executive Vice President, General Counsel , Corporate Secretary and Chief Policy and Risk Officer Presenters
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: Financial Performance
Driven by Energy. Delivering Energy. Financial Performance 2020 Diluted EPS Continuing Operations Earnings Retention (1 – Payout Ratio) Payout Ratio = Dividends Declared / Diluted EPS Continuing Operations Our financial performance is driven by the entrepreneurial spirit of our employees as we consi
Slide 5: Increased Performance is Driving Increased Value: Total Shareholder Return
Analyst Estimate - Average CPK 2019 GAAP EPS CPK Guidance – Low Range CPK Guidance – High Range Total Shareholder Return Increased Performance is Driving Increased Value Average Annualized Shareholder Return For Periods Ending December 31, 2020 Achieved 15 percent for 2020 and at least 13 percent fo
Slide 6: Increased Performance is Driving Increased Value: Market Capitalization
Analyst Estimate - Average CPK 2019 GAAP EPS CPK Guidance – Low Range CPK Guidance – High Range Market Capitalization Increased Performance is Driving Increased Value
Slide 7: 2020 Financial Performance Key Highlights
2020 Financial Performance Key Highlights 2020 diluted earnings per share from continuing operations was $4.21, an increase of $0.49 or 13.2 percent, our 14th consecutive year of earnings growth Expansion projects, customer growth, and pipeline replacements generated $15.5M in additional gross margi
Slide 8: Recent Strategic Growth Initiatives
Transmission infrastructure Expand Marlin CNG delivery RNG and LNG transport and RNG processing Combined Heat and Power Projects DNG and FPU gas organic growth Elkton Gas acquisition Propane business growth Regulatory Engagement Chesapeake Utilities Recent Strategic Growth Initiatives Total Sharehol
Slide 9: 2020 Business Highlights
2020 Business Highlights Invested $196M in capital expenditures that will drive our future earnings growth, including completion of several key pipeline projects Responded to increased customer demand for natural gas in our services, recognizing 5.3% and 4.1% percent customer growth on Delmarva and
Slide 10: Financial Summary: Income from Continuing Operations and GAAP Income
Financial Summary Income from Continuing Operations and GAAP Income For the periods ended December 31, 2020 and 2019 (in thousands except per share amounts)
Slide 11: Financial Summary: Operating Results for 2020 and 2019
Financial Summary Operating Results for 2020 and 2019 11 Increased Other Operating Expenses $4.2M or 2.7% overall increase $2.2M Regulated and Unregulated Acquisitions $2.1M Insurance Expense (non-health) – both insured and self-insured Excluding these impacts expenses were flat to prior year Effect
Slide 12: Key Drivers of Our Performance
Per Share After-Tax Diluted Earnings per Share – Recent Acquisitions and Hurricane Michael margins are shown net of expenses, with ($0.08) per share diluted from increased share count from 2020 equity offerings Key Drivers of Our Performance Key Variances for 2020 Compared to 2019 Gross Margin Incre
Slide 13: Hurricane Michael Regulatory Proceeding
Hurricane Michael Regulatory Proceeding Income Impact for the year ended December 31, 2020 The settlement agreement allowed FPU to: record regulatory assets for storm costs in the amount of $45.8 million including interest which will be amortized over six years; recover these storm costs through a s
Slide 14: Capital Expenditures Forecast
Capital Expenditures Forecast Actual 2020 and Forecast for 2021 For the five years ended December 31, 2020, the Company invested $1 billion - 149% of total capitalization as of 2015 year-end.
Slide 15: Key Expansion Projects
Key Expansion Projects Pipeline Growth and Margin Contribution Project Capital Investment Fully In-Service Annual Gross Margin Estimate West Palm Beach County Del-Mar Energy Pathway Auburndale Project Callahan Pipeline (JV) Guernsey Power Station 2021 Second Quarter $5.2 million 2021 Fourth Quarter
Slide 16: Major Projects and Initiatives Annual Increases
Major Projects and Initiatives Annual Increases (000’s) $27,234 $16,206 $7,082 Total Increases $50,522
Slide 17: Capital Structure Overview
Capital Structure Overview Strong Balance Sheet to Support Growth Achieved our target equity range Issued $89.7 million equity thru ATM and Various Stock Plans Issued $90 million new LT Debt at 2.98% Established $375 million bank facility Renewed and expanded LT Debt shelf facilities - $310 million
Slide 18: 2021-2025 Strategic Growth Initiatives
Chesapeake Utilities 2021 – 2025 Strategic Growth Initiatives Key 2021-2025 Strategic Initiatives Renewable Natural Gas (RNG) opportunities across the CPK Value Chain Expand Marlin Gas Services Virtual Pipeline Business (CNG, RNG, LNG) Further expansion of our propane business Pursue interstate and
Slide 19: CPK's Renewable Natural Gas Proposition
CPK’s Renewable Natural Gas Proposition Presents Multiple Investment Opportunities CPK RNG Initiatives: Bioenergy DevCo - Poultry Waste (Delaware) CleanBay Renewables – Chicken Litter (Maryland) Fortistar - Waste Recycling (Ohio) Seeking Other Development Opportunities, including in Florida and Geor
Slide 20: Continued Record Investment in Our Business Growth
$250,000 Mid-Point $187.5 Million Dollars in Thousands Unless Otherwise Noted Total $1 billion Total $750 million $175,000 to $200,000 $562.5 million from 2021 Mid-point Capital Investment Guidance Continued Record Investment in Our Business Growth *2021 Capital Budget range of $175 million to $200
Slide 21: Diluted Earnings per Share Guidance
CPK Guidance – Low Range CPK Guidance – High Range 2017* 2018 2019 2020 ---2025-- ---2022-- Previous CPK High Range Previous CPK Low Range CPK Low Range CPK High Range CPK Guidance - Low Range 5-Year CAGR EPS Growth 10.2% - 11.1% 8-Year CAGR EPS Growth 9.7% to 10.1% Strategic Capital Investments Con
Slide 22: ESG Stewardship
ESG Stewardship We take seriously our responsibility to be a good and trusted corporate citizen, and doing all we can to contribute to greater sustainability and societal advancement. For more than 160 years, we have delivered affordable and sustainable energy solutions that respond to the evolving
Slide 23: ESG Stewardship
ESG Stewardship C Co-sponsor of the Black History Month campaign in Delaware and Maryland Companywide all employee calls with our President and CEO Corporate safety meetings and quarterly safety newsletter Committed to lower carbon emissions across our service territories Challenge to take 6,500 ste
Slide 24: Investment Proposition
Investment Proposition Committed to Superior Performance Capitalizing on new organic growth and operational efficiencies Investing in pipeline systems that provide natural gas service to downstream customers Identifying propane opportunities to access new markets with significant growth potential Pu
Slide 25: Thank You
Commitment Growth Leadership Safety Sustainability Solutions Driven ByEnergy Strength Team Service Performance Community Value Thank You Chesapeake Utilities Corporation