Dominion Energy, Inc. · NYSE:D
Dominion Energy — Q3 2016 Earnings Presentation
20 slides from Dominion Energy's earnings presentation, Oct 31, 2016
Slide 1: Third Quarter 2016 Earnings Call
Third Quarter 2016 Earnings Call October 31, 2016
Slide 2: Important Note to Investors
Important Note to Investors This presentation contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding Dominion and Dominion Midstream. The statements relate to, among other things, expectations, estimates and projections concer
Slide 3: Operating Earnings Summary
Operating Earnings Summary Third Quarter 2016 Versus Guidance $1.14 $1.10 3rd Quarter Drivers $0.95 Weather Lower operating expenses Timing of partnership income Millstone margins Guidance Actual Range Operating EPS* *See page 30 of the third quarter 2016 Earnings Release Kit for a reconciliation to
Slide 4: Operating EBITDA Summary
Operating EBITDA Summary Third Quarter 2016 Versus Guidance (in $millions) Operating Guidance Actual Drivers Segment EBITDA EBITDA Dominion Virginia Weather $395 - $430 $423 Power Major storm restoration Dominion Weather $840 - $905 $921 Generation Millstone outage Questar Dominion Energy $275 - $29
Slide 5: Dominion Midstream Partners Third Quarter 2016 Earnings and Distribution
Dominion Midstream Partners (DM) Third Quarter 2016 Earnings and Distribution – Financial Results in line with Management expectations • Net Income $24.3 million • Adjusted EBITDA $27.9 million* • Distributable Cash Flow $24.1 million* – Distribution Results • Board declared 3Q 2016 cash distributio
Slide 6: Cash Flow and Financing Activities
Cash Flow and Financing Activities Third Quarter 2016 – Cash Flow & Liquidity • $3.1 billion in funds from operations through 3Q 2016 • $5.5 billion of credit facilities* • $2.5 billion of liquidity* – Recent Financing Activities • DRI $1.3 billion senior notes issuance • DRI $1.4 billion mandatory
Slide 7: Operating Earnings Guidance
Operating Earnings Guidance Fourth Quarter 2016 $1.05 4th Quarter Drivers Return to normal weather $0.90 Absence of a Millstone outage $0.70 Growth projects Lower capacity expense Questar Financing costs 4Q 2015 4Q 2016 EPS* Guidance* *See page 36 and 37 of the third quarter 2016 Earnings Release Ki
Slide 8: Generation Growth Project Update – Greensville
Dominion Generation Growth Project Update – Greensville – 1,588 MW plant in Greensville County, VA • 3-on-1 gas fired combined cycle • Duct burners, inlet air chillers, gas only Charlottesville Richmond – Estimated Costs of $1.3 billion Greensville – Major Milestones • Final air permit issued in Jun
Slide 9: Generation Growth Project Update – Solar
Dominion Generation Growth Project Update – Solar – Utah long-term contracted solar projects went in-service in September 2016 – on-time and on-budget • Four Brothers – 50% ownership in 320 MW facility • Three Cedars – 50% ownership in 210 MW facility – Virginia and North Carolina solar under develo
Slide 10: Energy Growth Project Update – Cove Point Liquefaction
Dominion Energy Growth Project Update – Cove Point Liquefaction Construction is On-time & On-budget – Engineering is ~99% complete – Procurement of engineered equipment is ~99% complete – 2,000+ construction workers on-site Project is ~75% Heat exchanger complete Please refer to page 2 for risks and
Slide 11: Atlantic Coast Pipeline and DTI Supply Header
Dominion Energy Atlantic Coast Pipeline and DTI Supply Header Received FERC Notice of ACP OWNERSHIP STRUCTURE: Dominion Resources* 48% Schedule Aug. 12, 2016 Duke Energy Southern Company 47% 5% Signed construction SUPPLY HEADER OWNERSHIP: Dominion Resources* 100% contract with Spring Ridge Const
Slide 12: Gas Infrastructure Growth
Dominion Energy Gas Infrastructure Growth Primarily demand-driven projects moving gas to end-use customers – Cove Point Liquefaction – Atlantic Coast Pipeline / Supply Header – Market Access Projects – Producer Outlet Projects – Additional Demand-Driven Projects Under Discussion Currently have ~4 Bc
Slide 13: Questar Merger Complete
Questar Merger Complete Announced February 1, 2016 Closed on September 16, 2016 Consistent with strategic focus on core energy infrastructure Combination of integrated natural gas asset profiles with extensive supply, transportation, storage and distribution experience Enhances the regulated
Slide 14: Key Takeaways
Key Takeaways Third Quarter 2016 Earnings and Operational Highlights Executing the growth plan and delivering on guidance – Dominion Operating earnings of $1.14 per share well above top end of third quarter guidance range* – Strong operating and safety performance in the third quarter – Greensville
Slide 15: Midstream Partners: Low-cost Dropdown Financing Secured
Dominion Midstream Partners Low-cost Dropdown Financing Secured Among largest financing transactions by a publicly-traded MLP in 2016 Low-cost financing secured: Preferred equity issued with 4.75% initial distribution, lowest ever in MLP sector Common equity issued at 2.9% discount to last p
Slide 16: Midstream Partners: Acquisition of Questar Pipeline
Dominion Midstream Partners Acquisition of Questar Pipeline – DM will acquire Questar Pipeline from Dominion for $1.725 billion Scheduled to close Dec. 1 – Contribution represents a 10.3x 2016E EBITDA valuation multiple – Transaction financing includes: Preferred equity DM debt / assumed debt
Slide 17: Midstream Partners: Common Equity Financing
Dominion Midstream Partners Common Equity Financing – Common equity – ~$500 million* 2.9% discount to last trade – lowest in MLP market in 2016 Greater than 140x Average Daily Trading Volume ~80% of existing public float Deal Size Re-offer Discount Mult. of Avg. Vol. % of Public Float $663 7.2
Slide 18: Midstream Partners: Preferred Equity Financing
Dominion Midstream Partners Preferred Equity Financing – Preferred equity – up to $600 million to external investors Lowest initial distribution in MLP history – 4.75% Conversion premium of 15% Placed with a group of private investors led by Stonepeak Infrastructure Partners Historical MLP Con
Slide 19: Total Projected Cash Flow to Dominion
Dominion Midstream Partners Total Projected Cash Flow to Dominion ($ billions) Questar Pipeline Validates model to generate ~$7 - $8 billion in cash for dropdown financing Dominion from 2016-2020* generates ~$1.2 billion of cash for Dominion to paydown debt 2017 2018 2019 2020 Drop Down Proceeds LP
Slide 20: Third Quarter 2016
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