Chesapeake Utilities Corporation · NYSE:CPK
Chesapeake Utilities — 2019 AGA Financial Forum
36 slides from Chesapeake Utilities's conference presentation, May 22, 2019
Slide 1: 2019 AGA Financial Forum
2019 AGA Financial Forum May 21-23, 2019 Exhibit 99.1
Slide 2: 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 3: Financial Update
Financial Update Our Commitment to Financial Discipline and Shareholder Value 3
Slide 4: A Strong Foundation for Growth
A Strong Foundation for Growth $1.5 Billion Market Capitalization (4/30/19) Five Years 11.0% plus ROE 8.8% EPS CAGR $283 Million Capital Investment in 2018 246,000 Distribution Customers 5,359 Miles of Gas Pipelines and Distribution Mains $1.7 Billion Total Assets (12/31/2018) 12 Years Superior Annu
Slide 5: Earnings and Dividends: Twelve Years of Superior Growth
Earnings and Dividends Twelve Years of Superior Growth 10-year CAGR EPS Growth – 10.1% *Adjusted Non-GAAP EPS of $2.89 excludes TCJA Impact 5 We have generated strong earnings growth, which has enabled us to grow our recent dividends faster than our peers.
Slide 6: Capital Projects – High Return / High Investment
Capital Projects – High Return / High Investment Peer ROE vs. Capital Expenditures (January 2016 – December 2018) 6
Slide 7: Strategic Achievements in 2018
Strategic Achievements in 2018 Substantially completed Eastern Shore Natural Gas 2017 System Expansion - Set a new daily delivery record in excess of 250,000 dekatherms - Recovered cost of the System Expansion and reliability projects through FERC rate proceeding that contributed $9.5 million in mar
Slide 8: First Quarter 2019 Highlights
Chesapeake Utilities – First Quarter 2019 Highlights 8 Superior Shareholder Return Driven by Consistent Above Average Earnings and Dividend Growth Greater than 16% total shareholder return for 1, 3, 5, 10 & 20 years ended April 30, 2019 20% growth in adjusted earnings per share for first quarter 201
Slide 9: Reconciliation of GAAP to Adjusted Earnings
Reconciliation of GAAP to Adjusted Earnings First Quarter 2019 2019 is off to a great start (whether measured from a GAAP or non-GAAP basis) 9
Slide 10: Capital Capacity Has Supported Our Growth
Capital Capacity Has Supported Our Growth Total Capitalization has More Than Doubled in Five Years Equity/Permanent Capitalization 65.5% 70.6% 76.5% 71.1% 62.1% 65.5% Equity/Total Capitalization 54.0% 51.9% 55.4% 51.5% 45.4% 46.2% $556,148 $689,692 $805,010 $944,079 $1,177,559 Target Equity to Total
Slide 11: Investing for the Future
Investing for the Future Current and Future Growth Opportunities 11
Slide 12: Continuing to Build for the Future: Capital Expenditures
Continuing to Build for the Future Capital Expenditures We have invested $1.37 billion in capital expenditures from 2009 to 2018 (ten year period) which has propelled our growth. $ in thousands 2019 Forecasted Capital Expenditures $66,787 Natural Gas Transmission 70,092 Natural Gas and Electric Dist
Slide 13: Major Projects and Initiatives
Major Projects and Initiatives Increasing Shareholder Value by Continuously Seeking and Developing Projects and Initiatives 13
Slide 14: Natural Gas Expansion Projects
Natural Gas Expansion Recent Eastern Shore and Florida Transmission Projects 9 14 Expansion Projects Completion Date Investment Amount (000’s) Fully In-Service Annual Margin (000’s) 2017 Eastern Shore System Expansion, Delmarva (1) Q2 - 2019 $117,000 $16,183 Northwest Florida Expansion, Florida Q2 -
Slide 15: Del-Mar Energy Pathway Project
Del-Mar Energy Pathway Project Under Development Strategic Growth Initiative 15 Maximize Organic Growth in Existing Geographic Footprint Expand into New Geographic Areas Develop Additional Growth Across Business Units The proposed facilities associated with the Project will provide the transportatio
Slide 16: Callahan Pipeline – PPC Expansion Project
Callahan Pipeline – PPC Expansion Project Nassau County, Florida Construct a Jointly owned intrastate pipeline with Peninsula Pipeline unit and Peoples Gas in Nassau County, Florida 16 Joint intrastate transmission project between Peninsula Pipeline Company and Seacoast Gas Transmission (an EMERA Af
Slide 17: Callahan Pipeline, Nassau County, Florida
Callahan Pipeline Nassau County, Florida 17
Slide 18: Marlin Gas Services: Significant Growth Potential
Marlin Gas Services Significant Growth Potential 9 18 Mobile Compressed Natural Gas Delivery Solutions. Emergency response for pipeline and gas distribution systems Temporary service for planned maintenance or system upgrade outages Virtual pipeline delivery Transport of RNG from landfills or biogas
Slide 19: Marlin Gas Services Q1 Results and 2019 Forecast
Marlin Gas Services Q1 Results and 2019 Forecast 9 19 Growth Forecast 2020 Margins expected to be >$6.0M Additional trailers and compressors on order Offload regulators are being constructed Further territorial expansion into the Southeast, Mid-Atlantic, and Gulf Coast regions Negotiating utilizatio
Slide 20: Regulatory and Governance
Regulatory and Governance Our Commitment to Innovation and Sustainability 20
Slide 21: Significant Regulatory Initiatives
Significant Regulatory Initiatives First Quarter 2019 Developments and Currently Planned Filings 9 21 Florida - FPU TCJA – Natural Gas (non-GRIP) (CFG and FPU) Company retains benefit: $1.3MM reserve reversal in Q1; annual benefit = $1.9MM TCJA – Natural Gas (GRIP) Customer rates were adjusted throu
Slide 22: Sustainability and ESG
2018 Air Quality Awareness Champion Green Globes Certificate Energy Lane Facility CNG Vehicle Fuel Marlin Gas Services Eight Flags Combined Heat and Power Plant Sharp AutoGas Chesapeake Utilities Commitment Sustainability and ESG 22
Slide 23: Corporate Culture and Corporate Governance
Corporate Culture Corporate Governance 2018 Best North American Utility for Corporate Governance Connecting with our Customers and Communities - Chesapeake Utilities recognizes that customers expect safe, efficient and reliable service , as well as enhanced business connection options, more convenie
Slide 24: Closing Remarks
Closing Remarks 24
Slide 25: NYSE Opening Bell
NYSE OPENING BELL”
Slide 26: Market Capitalization Increased
Market Capitalization Increased Performance is Driving Increased Value 26 18% Annual Growth In Market Capitalization Market Capitalization has doubled in less than five years Current Market Capitalization of $1.519 billion CPK Stock Price of $92.64 per share as of April 30, 2019 $10,000 invested in
Slide 27: Total Shareholder Return Comparison
Total Shareholder Return (TSR) Comparison to Broader Market – S&P 500 Companies and Peer Group Comparison 27 Source: Bloomberg Chesapeake is driven to increase shareholder value…. Our compound annual return has exceeded 16% for all periods shown through April 30, 2019. Chesapeake exceeded the peer g
Slide 28: Expect Growth Well Above Industry Average
Chesapeake Utilities Corporation Expect Growth Well Above Industry Average Earnings per Share 28 Capital Expenditures We target EPS Growth to be 7.75% to 9.5% over 5 years * * 2017 Adjusted Non-GAAP EPS of $2.89 (Excludes TCJA) Earnings per Share 2019 - 2022
Slide 29: A Strong Foundation for Growth
A Strong Foundation for Growth Chesapeake Utilities’ solid track record, driven by our strong aspiration for growth and commitment to care for our employees, customers, investors and communities we serve. Chesapeake Utilities is well positioned to continue to build on its strong foundation and deliv
Slide 30: Thank You!
Thank You! Jeff Householder President & CEO jhouseholder@chpk.com Beth Cooper Executive Vice President, CFO and Asst. Secretary bcooper@chpk.com Any Questions? Jim Moriarty Executive Vice President, General Counsel and Corporate Secretary jmoriarty@chpk.com
Slide 31: Appendices
Appendices 31
Slide 32: Chesapeake Utilities' Energy Delivery Systems
Chesapeake Utilities’ Energy Delivery Systems Natural Gas Transmission Delaware, Maryland, Pennsylvania, Florida, Ohio Electric Distribution Florida Propane Distribution and AutoGas Delaware, Maryland, Pennsylvania, Virginia, Florida Natural Gas Distribution Delaware, Maryland, Florida Mobile CNG Te
Slide 33: 2018 Financial Highlights
2018 Financial Highlights Net income of $56.6 million of $3.45 per share, - Compared to $58.1 million $3.55 per share in 2017; which included an $0.87 one-time gain from Tax Cuts and Jobs Act (“TCJA”). - Generated increased per share income for all but $0.10 of the TCJA gain. Capital expenditures we
Slide 34: Delivering Consistent and Higher Returns
Delivering Consistent and Higher Returns Return on Equity Chesapeake Utilities has delivered top quartile ROEs over the long-term. Our return on equity has been driven by our (i) innovative approach to cultivate, develop and consummate growth projects and initiatives, and (ii) generating higher retu
Slide 35: Reconciliation of First Quarter Results
Reconciliation of First Quarter Results Key Variances 2019 versus 2018 35 Significant margin growth drives strong first quarter performance Eastern Shore and Peninsula Pipeline expansion projects Acquisitions of Marlin and Ohl assets Organic growth in natural gas distribution and Aspire Regulatory i
Slide 36: www.CHPK.com
www.CHPK.com