Slide 1: Vector Special Meeting
VECTOR LIMITED Vector Special Meeting Wednesday 16 December 2015 Ellerslie Event Centre, Auckland Creating a new energy future
Slide 2: Disclaimer
VECTOR LIMITED Disclaimer This presentation contains forward-looking statements. Forward-looking statements often include words such as "anticipates", "estimates", "expects", "intends", "plans", "believes“ and similar words in connection with discussions of future operating or financial performance.
Slide 3: Michael Stiassny, Chairman
VECTOR LIMITED Michael Stiassny Chairman
Slide 4: Directors
VECTOR LIMITED Directors • James Carmichael • Hugh Fletcher • Jonathan Mason • Dame Alison Paterson • Karen Sherry • Bob Thomson 4
Slide 5: Today's programme
VECTOR LIMITED Today’s programme • Transaction overview • Transaction detail • Resolution • Voting • Meeting close 5
Slide 6: Strategic review of Vector Gas
VECTOR LIMITED Strategic review of Vector Gas • Vector’s gas transmission & non-Auckland Vector transmission system Maui pipeline gas distribution businesses Non-Auckland Gas Distribution System − 2,200 km of high pressure gas transmission pipelines supplying natural gas across North Island − 4,800
Slide 7: Sale realises full value for shareholders
VECTOR LIMITED Sale realises full value for shareholders • The strategic review culminated in three final offers to buy the business • Vector has agreed to sell for $952.5 million to Australia’s First State Funds, resulting in a gain on sale of around $167 million* • The sale price realises full val
Slide 8: Simon Mackenzie, Group Chief Executive
VECTOR LIMITED Simon Mackenzie Group Chief Executive
Slide 9: Creating a new energy future
VECTOR LIMITED Creating a new energy future
Slide 10: Leveraging our heritage and creating options
VECTOR LIMITED Leveraging our heritage and creating options 10
Slide 11: Auckland offers strong growth opportunities
VECTOR LIMITED Auckland offers strong growth opportunities Auckland New Dwelling Consents* Auckland Network CAPEX Forecast* ($m) 1,800 200 1,600 10,000 1,400 8,300 150 1,200 6,827 1,000 5,291 100 800 4,197 3,394 600 50 400 200 0 0 FY11 FY12 FY13 FY14 FY15 Auckland FY16 FY17 FY18 FY19 FY20 FY21 FY22
Slide 12: Metering success creates growth platform
VECTOR LIMITED Metering success creates growth platform Vector’s Technology business contributes more Australian metering potential than $100 million to group EBITDA CONTRACTED & INSTALLED SMART METERS 1,200,000 1,000,000 800,000 600,000 400,000 200,000 - Contracted 3Installed per. Mov. Avg. (Instal
Slide 13: A new energy future at home
VECTOR LIMITED A new energy future at home 13
Slide 14: Now is a good time to sell Vector Gas
VECTOR LIMITED Now is a good time to sell Vector Gas • Vector’s Auckland networks and Vector Technology unregulated activities offer more 2009-2014* attractive growth and volume • EBITDA rises 92% to opportunities $100.0 million from $52.1 million • Parallels to the sale of Wellington Wellington Ele
Slide 15: $952.5 million is a good price for Vector Gas
VECTOR LIMITED $952.5 million is a good price for Vector Gas Australasian Network EBITDA Multiples • EV/EBITDA multiple 19.0x of 12.3x (trailing) EBITDA Transaction • Higher than all public EBITDA Trading Multiples Sep 14 Multiples 17.0x Australasian sale Nov 15 15.0x multiples since 2012, 13.0x exc
Slide 16: First State is a leading infrastructure manager
VECTOR LIMITED First State is a leading infrastructure manager Electricity North West (UK) Reganosa (Spain) - 2.4 million ICPs. - LNG regasification terminal in Galicia Anglian Water (UK) ANZ Terminals (Australasia) - The largest water and - 9 bulk liquid storage terminals wastewater utility in the
Slide 17: Vector and First State to cooperate
VECTOR LIMITED Vector and First State to cooperate • The sale will result in a significant gain on sale in the 2016 financial year − If the sale had occurred on 30 June 2015 the gain would have been $167 million. The actual gain will depend on the date of completion • Sale is conditional on: − Appro
Slide 18: Sale further strengthens Vector's balance sheet
VECTOR LIMITED Sale further strengthens Vector’s balance sheet • Proceeds will be applied to debt repayment, further strengthening Vector’s balance sheet metrics − If the transaction had occurred on 30 June 2015, gearing would decrease from 54% to 42% − Assuming no other changes to Vector’s business
Slide 19: Sale is in the best interests of shareholders
VECTOR LIMITED Sale is in the best interests of shareholders • Vector is creating a new energy future and we are leading change in New Zealand • The sale of Vector Gas allows the company to redeploy capital in a way that is aligned with our vision • Vector has completed an exhaustive process and has
Slide 20: Michael Stiassny, Chairman
VECTOR LIMITED Michael Stiassny Chairman
Slide 21: Resolution
VECTOR LIMITED Resolution “To approve the sale by NGC Holdings Limited of all of the shares in Vector Gas Limited to Odysseus Investments Limited under an Agreement for the Sale and Purchase of shares in Vector Gas Limited dated 9 November 2015 between Vector Limited, NGC Holdings Limited, Odysseus
Slide 22: Proxy position
VECTOR LIMITED Proxy position Proxy voting For 810,968,392 Against 596,905 Discretionary 2,050,822 Abstain 40,741 22
Slide 23: Voting
VECTOR LIMITED Voting
Slide 24: Creating a new energy future
VECTOR LIMITED Creating a new energy future
Slide 25: © WWW.VECTOR.CO.NZ
© WWW.VECTOR.CO.NZ