Infratil Limited · NZX:IFT

Infratil — Trustpower — Investor Presentation (November 2015)

37 slides from Infratil's investor presentation, Nov 3, 2015

Slide 1: Investor Briefing
CLICK TO EDIT Investor Briefing November 2015
Slide 2: Contents
Contents  Trustpower Key Facts  Market Environment  Results Summary and Operational Performance  Funding and Shareholder Performance  Retail Multiproduct Strategy – Progress Update  Generation Pipeline and Australian Options  KCE Takeover Offer  Group Strategic Focus © Trustpower Limited
Slide 3: Trustpower key facts
Trustpower key facts • Tauranga based national electricity generator / retailer • Market capitalisation circa NZ$2.4 billion • Key shareholders Infratil (50.6%), TECT (26.6%) • Free float of Trustpower’s shares 22.1% (excludes treasury stock) • New Zealand generation capacity (hydro / wind) 634 MW p
Slide 4: Contents
Contents  Trustpower Key Facts  Market Environment  Results Summary and Operational Performance  Funding and Shareholder Performance  Retail Multiproduct Strategy – Progress Update  Generation Pipeline and Australian Options  KCE Takeover Offer  Group Strategic Focus © Trustpower Limited
Slide 5: NZ electricity 7 day rolling spot prices last 12 months
NZ electricity 7 day rolling spot prices last 12 months Wholesale pricing subdued over H1 FY16 Source : NZX Pricing Manager © Trustpower Limited
Slide 6: NZ 7 day rolling demand last 12 months
NZ 7 day rolling demand last 12 months Demand consistently higher than last 2 years plus winter peaks have driven higher gas consumption Source : Transpower © Trustpower Limited
Slide 7: NZ hydro storage position
NZ hydro storage position National storage tracking slightly above long term average since May Source: COMIT Hydro Summary – 23 Oct 2015 © Trustpower Limited
Slide 8: El Nino – no correlation to dry years
EL Nino – no correlation to dry years 1992 2001 2003 2008 2012 Well known NZ dry years Sources : https://www.niwa.co.nz/education‐and‐training/schools/students/enln http://www.bom.gov.au/watl/about‐weather‐and‐climate/australian‐climate‐influences.shtml?bookmark=enso © Trustpower Limited
Slide 9: El Nino – no correlation to electricity prices
EL Nino – no correlation to electricity prices © Trustpower Limited
Slide 10: Contents
Contents  Trustpower Key Facts  Market Environment  Results Summary and Operational Performance  Funding and Shareholder Performance  Retail Multiproduct Strategy – Progress Update  Generation Pipeline and Australian Options  KCE Takeover Offer  Group Strategic Focus © Trustpower Limited
Slide 11: Half Year results summary
Half Year results summary Key Drivers Comments • Growth agenda delivering improved profitability despite EBITDAF $184m up 6% challenging conditions characterised by low wholesale prices, generation over‐capacity and high NZD/AUD Underlying NPAT $68.3m up 1% exchange rate • NZ generation production s
Slide 13: EBITDAF, underlying earnings after tax and operating cash flow
EBITDAF, underlying earnings after tax and operating cash flow year to 30 September 2015 © Trustpower Limited
Slide 16: Current sources of debt financing
Current sources of debt financing • Longer term funding mix currently provided by a combination of retail senior and subordinated bonds and ECA facilities. • Strategic liquidity from committed but undrawn bank facilities rebuilding post completion of Snowtown Stage 2. • NZD 100M of sub bonds maturin
Slide 19: Contents
Contents  Trustpower Key Facts  Market Environment  Results Summary and Operational Performance  Funding and Shareholder Performance  Retail Multiproduct Strategy – Progress Update  Generation Pipeline and Australian Options  KCE Takeover Offer  Group Strategic Focus © Trustpower Limited
Slide 20: Trustpower brand awareness in Auckland growing
Trustpower brand awareness in Auckland growing © Trustpower Limited
Slide 21: Trustpower brand awareness in Auckland growing
Trustpower brand awareness in Auckland growing © Trustpower Limited
Slide 22: Strong sales momentum first half FY16
Strong sales momentum first half FY16 New Electricity Connections April ‐ September 2015 © Trustpower Limited
Slide 23: Bundle penetration
Bundle penetration • Two out of three new customers taking a bundled service including telco services • Reduction in churn rate of bundled customers to electricity only customers exceeds 40% • Bundle penetration exceeding expectations and targets © Trustpower Limited
Slide 24: Bundled churn lower
Bundled churn lower Contracted position remains strong Annualised Churn Rate Power only 41% lower churn Power and telco © Trustpower Limited
Slide 25: Insight and proposition development
Insight and proposition development • Developing an integrated approach to deep customer understanding • Generating insights that will enable targeted proposition development • Improved acquisition and retention rates • Reduced cost to acquire © Trustpower Limited
Slide 26: Contents
Contents  Trustpower Key Facts  Market Environment  Results Summary and Operational Performance  Funding and Shareholder Performance  Retail Multiproduct Strategy – Progress Update  Generation Pipeline and Australian Options  KCE Takeover Offer  Group Strategic Focus © Trustpower Limited
Slide 27: Generation development pipeline
Generation development pipeline • Trustpower retains significant options • NZ hydro and wind ‐ Near term oversupply headwind to investment ‐ Maintain options as long as possible • Australian wind ‐ LRET renewable energy ‐ Target largely met by wind ‐ PPA’s mitigate risk but may be hard to achieve ‐
Slide 28: Renewable energy target review
Renewable energy target review Likely to be a new build opportunity of circa 15,000 GWh of renewable energy in Australia over next 5 years. 80 – 90% expected to be wind © Trustpower Limited
Slide 29: Contents
Contents  Trustpower Key Facts  Market Environment  Results Summary and Operational Performance  Funding and Shareholder Performance  Retail Multiproduct Strategy – Progress Update  Generation Pipeline and Australian Options  KCE Takeover Offer  Group Strategic Focus © Trustpower Limited
Slide 30: King Country Energy (KCE)
King Country Energy (KCE) • Trustpower has today given notice of intention to make a full takeover offer for KCE • Offer price is $4.78 per share but this will increase to $5 per share if acceptances of 70.2% or more are received (excluding any acceptance of King Country Electric Power Trust (KCEPT)
Slide 31: KCE business summary
KCE business summary Retail Summary • 17,500 ICPs with majority (69%) on KCE’s incumbency network • Domestic customers also in Waipa and Waikato regions • SME customers across North Island Strategic Fit with Trustpower • Small/medium sized North Island hydros and provincial customer base fit well wi
Slide 32: KCE takeover offer milestones
KCE takeover offer milestones  Offer to be made between 14 and 30 days after the Takeover Notice sent to KCE  Nova to accept offer within 3 days after despatch  Payments in respect of acceptances after offer becomes unconditional within 7 days of receipt of acceptance © Trustpower Limited
Slide 33: Contents
Contents  Trustpower Key Facts  Market Environment  Results Summary and Operational Performance  Funding and Shareholder Performance  Retail Multiproduct Strategy – Progress Update  Generation Pipeline and Australian Options  KCE Takeover Offer  Group Strategic Focus © Trustpower Limited
Slide 34: Group strategic focus
Group strategic focus Retail Growth Initiatives • Regional and metro acquisition campaigns continue • Focus on technology tools and analysis to improve customer and target market insights • Cross sell to existing customer base • Advanced metering deployment under review but some deployment likely in
Slide 35: Non-GAAP measures
Non‐GAAP measures • Underlying Earnings is a non GAAP (Generally Accepted Accounting Principles) financial measure. Trustpower believes that this measure is an important additional financial measure to disclose as it excludes movements in the fair value of financial instruments which can be volatile
Slide 36: Disclaimer
Disclaimer Some of the information set out in the presentation relates to future matters, that are subject to a number of risks and uncertainties (many of which are beyond the control of Trustpower), which may cause the actual results, performance or achievements of Trustpower or the Trustpower Grou
Slide 37: Thank you
Thank you trustpower.co.nz

Trustpower — Investor Presentation (November 2015) on 6ix

Infratil — Trustpower — Investor Presentation (November 2015)

Slide 1: Investor Briefing

Slide 2: Contents

Slide 3: Trustpower key facts

Slide 4: Contents

Slide 5: NZ electricity 7 day rolling spot prices last 12 months

Slide 6: NZ 7 day rolling demand last 12 months

Slide 7: NZ hydro storage position

Slide 8: El Nino – no correlation to dry years

Slide 9: El Nino – no correlation to electricity prices

Slide 10: Contents

Slide 11: Half Year results summary

Slide 12: EBITDAF bridge first half FY15 – FY16

Slide 13: EBITDAF, underlying earnings after tax and operating cash flow

Slide 14: Sources of own New Zealand generation

Slide 15: Overhead costs and customer numbers

Slide 16: Current sources of debt financing

Slide 17: Gearing measures

Slide 18: Dividends

Slide 19: Contents

Slide 20: Trustpower brand awareness in Auckland growing

Slide 21: Trustpower brand awareness in Auckland growing

Slide 22: Strong sales momentum first half FY16

Slide 23: Bundle penetration

Slide 24: Bundled churn lower

Slide 25: Insight and proposition development

Slide 26: Contents

Slide 27: Generation development pipeline

Slide 28: Renewable energy target review

Slide 29: Contents

Slide 30: King Country Energy (KCE)

Slide 31: KCE business summary

Slide 32: KCE takeover offer milestones

Slide 33: Contents

Slide 34: Group strategic focus

Slide 35: Non-GAAP measures

Slide 36: Disclaimer

Slide 37: Thank you