Unitil Corporation · NYSE:UTL
Unitil — American Gas Association Financial Forum 2014
24 slides from Unitil's conference presentation, May 16, 2014
Slide 1: American Gas Association Financial Forum
May 2014 American Gas Association Financial Forum Exhibit 99.1
Slide 2: Unitil Service Areas
Unitil Service Areas Natural gas and electric utility serving approximately 180,000 gas and electric customers in Maine, New Hampshire and Massachusetts
Slide 3: The Shale Revolution
The Shale Revolution ~100 Years of Supply
Slide 4: Compelling Price Advantage Current Retail Cost Comparison
Compelling Price Advantage Current Retail Cost Comparison (Residential Customer) Source: Unitil estimates Natural gas costs 50% less than home heating oil $0 $1,000 $2,000 $3,000 $4,000 Annual Residential Heating Cost ($) Gas Fuel Oil
Slide 5: Low Gas Penetration
Low Gas Penetration Historically high heating oil use and relatively low penetration of natural gas in our service areas provides favorable conditions for growth ME Service Area: 49% on-the-main penetration NH Service Area: 61% on-the-main penetration
Slide 6: New Pipeline Capacity Gas Pipelines Serving New England
New Pipeline Capacity Gas Pipelines Serving New England New pipeline capacity will improve price competitiveness by increasing the delivery of abundant shale gas to northern New England Source: EIPC
Slide 7: Growing Gas Customer Base
Growing Gas Customer Base Gas Customer Additions Targeting 4-6% annual therm sales growth 33% Long-Term Growth Potential
Slide 8: New Customer Potential
New Customer Potential Significant number of communities surrounding existing service areas remain unserved Up to 40,000 potential new customers along existing mains Up to an additional 250,000 potential new customers in unserved areas
Slide 9: Rate Case Results
Rate Case Results (1) Includes Fitchburg Electric requested revenue requirement of $6.7 million (of which $2.1 million is related to storm recovery) and additional storm reserve fund of $2.8 million 2014 Rate Relief (1) ~$60 million in rate relief since 2010 2010-2013 Rate Relief Over 50% increase t
Slide 10: Generating Financial Results
Generating Financial Results Gas & Electric Sales Margin Net Income 12% ($ in millions) 32% ($ in millions)
Slide 11: Historical Dividend Stability
Historical Dividend Stability Current quarterly dividend is $0.345 (annual dividend is $1.38 per share) Current dividend yield of approximately 4.2% (1) Since incorporation in 1984, Unitil has continuously paid quarterly dividends and has never reduced its dividend rate (1) As of May 14, 2014
Slide 12: Appendix
Appendix
Slide 13: Natural Gas Price Advantage
Natural Gas Price Advantage Current Retail Cost Comparison Long-Term Price Forecast Source: Unitil estimates On a retail-delivered basis, natural gas is approximately 50% the cost of retail fuel oil Typical residential customer saves on average ~$1,500 / year with natural gas Natural gas is currentl
Slide 14: On-the-Main Growth Potential
On-the-Main Growth Potential Natural Gas Penetration Maine New Hampshire 84.3% 0.1% Up to 40,000 potential new customers along existing distribution mains Source: US Census Bureau U.S. Natural Gas Penetration Rate ~48% 67% 5% 4% 7% Heating Oil Natural Gas Electic Heat Propane 47% 20% 8% 14% Heating
Slide 15: New Service Areas Gas Expansion Opportunities
New Service Areas Gas Expansion Opportunities Provide Years of Above Industry Average Customer Growth Up to 250,000 potential new customers 1. Poland New Service Area – 4.0 miles, 830 residential equivalent 2. Wells Extension – 1.2 miles, 440 residential equivalent 3. Lewiston Extension – 0.2 miles,
Slide 16: Q1 2014 Financial Results
Q1 2014 Financial Results First quarter net income of $12.6 million, or $0.91 per share Improvement of $1.8 million, or 17%, and $0.12 per share, compared to the first quarter of 2013 Improved financial results driven by colder weather and the positive impact of steady customer growth Three Months E
Slide 17: Key Performance Drivers: Gas Unit Sales and Margin
Key Performance Drivers Change Key Performance Drivers Change Gas Unit Sales and Margin 6% 15% 20% * Excludes decoupled gas sales Unit Sales Sales Margin Natural Gas Sales Margin Natural Gas Sales* Heating degree days increased 12% over prior year Growth in residential / C&I customers – 3.1% year-ov
Slide 18: Key Performance Drivers: Electric Unit Sales and Margin
Key Performance Drivers Change Key Performance Drivers Change Electric Unit Sales and Margin 4% * Excludes decoupled electric sales Unit Sales Sales Margin 5% Growth in residential / C&I customers Increased customer usage Distribution base rate increases Higher sales from customer additions and incr
Slide 19: Rate Relief Projected Base Rate Relief
Rate Relief Projected Base Rate Relief Approximately $37 million of rate relief achieved through end of Achieved additional rate relief from gas base rate cases for Northern Maine and New Hampshire divisions of $3.8 million and $4.6 million, respectively Favorable cost tracker mechanisms will result
Slide 20: Q1 2014 Return on Equity and Long-Term Rate Plans
Q1 2014 Return on Equity Subsidiary Q1 2014 Return on Equity Long-Term Rate Plans Authorized ROE Range of 9.20%-9.75% Northern Utilities (New Hampshire) Estimated rate adjustment of ~$1.4 million effective May 1, 2014 Northern Utilities (Maine) Estimated rate adjustment of ~$1.3 million effective Ma
Slide 21: Northern Utilities Rate Cases
Northern Utilities Rate Cases Maine Projected Rate Relief New Hampshire Projected Rate Relief Northern Utilities Maine Permanent increase in annual revenue of $3.8 million went into effect January 1, Includes a capital cost recovery tracking mechanism to recover the future costs associated with cast
Slide 22: Fixed Charge Increase and Gas Margin
Q1 2013 Gas Margin Q1 2014 Gas Margin Fixed Charge Increase Base rate design was adjusted in rate cases for Northern Utilities Maine and New Hampshire divisions Rate design in both jurisdictions reflects higher fixed charges (i.e. customer charge) to smooth customer bills throughout the year Higher
Slide 23: Capital Budget and Rate Base
Capital Budget and Rate Base Electric Rate Base 2014 Capital Budget $91 million Gas Rate Base Total capital budget of $91 million in 2014 Expect to double gas distribution rate base Plan to grow gas rate base to approximately $360 million by 2016, doubling the size of the gas business since 2008 ($
Slide 24: Balanced Capital Structure and Liquidity
Balanced Capital Structure 3/31/14 Liquidity 3/31/14 Capitalization Long Term Debt 51% Common Equity 49% Balanced capital structure 49% equity capitalization Significant liquidity to fund growth ($ in millions) Credit Facility Limit 120.0 $ Less: Current Balance 59.2 Liquidity 60.8 $ Preferred Stock
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