Slide 1: ASX transmittal: Results Announcement - Presentation
Origin energy To Company Announcements Office Facsimite 1300 300 021 Company Australian Stock Exchange Limited Date 20 February 2006 From Bill Hundy Pages 34 Subject Results Announcement - Presentation This Transmittal is confidential. If you have received this document in error, please contact Orig
Slide 2: Interim Results Announcement
Interim Results Announcement Half-year ended 31 December 2005 20 February 2006
Slide 3: Outline
Outline Performance Highlights Financial Review Operating Review Outlook All comparative data are in relation to the prior corresponding period, July - December 2004 and have been restated for A-IFRS, unless otherwise stated All references to $ are references to Australian dollars unless otherwise s
Slide 4: Performance Highlights
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Slide 5: Financial Highlights
Financial Highlights « Revenue and other « EBITDA « NPAT « Normalised basic EPS « Free cash flow (FCF) « FCF per share « Debt / (debt + equity) ¢ OCAT Ratio? « Interim dividend (fully franked) {1} Compared to financiat year end June 2005 {2) Calendar year 2005 Page 4 $3,008 million $589 million $194
Slide 6: Operating Highlights
Operating Highlights Page 5 Increased capacity of sales gas from Spring Gully to 35 TJ/day Otway Gas Project on target for commissioning in June 2006 Commissioning of the Lang Lang gas processing plant commenced in December 2005 Seismic survey acquired over the Trefoil discovery Major onshore and of
Slide 7: Financial Review
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Slide 8: Profit & Loss
Profit & Loss Dec 05 Dec 04 % change ($m) ($m) Revenue and other 3,008 2,291 31% EBITDA 589 441 34% EBIT 442 327 35% Net interest expense (87) (60) 46% Tax expense (92) (74) 25% Outside Equity Interests (69) (24) 190% NPAT 194 170 14% Basic earnings per share 25.5¢ 24.6¢ 4% (cents) Free cash flow cp
Slide 9: EBITDA of $589.3 million is 34% higher due to inclusion of Contact
EBITDA of $589.3 million is 34% higher due to the inclusion of Contact for a full six months Divisions Dec 05 Dec 04 % change ($m) ($m) Exploration & Production 98.7 117.7 (16%) Retail 142.2 158.9 (10%) Generation 43.1 29.7 45% Networks 15.8 18.8 (16%) Contact 289.5 115.5 151% Total 589.3 440.6 34%
Slide 10: A-IFRS Impact on EBIT and Profit
A-IFRS Impact on EBIT and Profit Dec 05 NPAT after EBLE AMHorities SM SM Total under A-GAAP Total A-IFRS adjustments (pre-Successful Efforts) Successful Efforts Total A-IFRS adjustments Total reported under A-IFRS Contingent asset {Moomba claim*) Aa? 194 Effective interest basis for Envestra distrib
Slide 11: Successful Efforts
Successful Efforts Dec 05 Dec 04 5M SM EBITDA before Successful Efforts 604 455 Increase in Exploration Expense (15) (14) Restated EBITDA 589 44] NPAT after Minorities before Successful Efforts 201 176 Increase in Exploration Expense a 5) a 4) Decrease in Amortisation Expense 5 5 Decrease in Tax Exp
Slide 12: AASB Financial Instruments
AASB 139 Financial Instruments Page t1 « Comparatives for December 2004 and June 2005 are not required to be restated under AASB 139 Financial instruments « Net impact on profit for the December 2005 half year is small due to a number of offsetting impacts ¢ The impact on profit in future periods ma
Slide 13: Depreciation & Amortisation
Depreciation & Amortisation Dec 05 ($m) Dec 04 ($m) Property plant & equipment 117.5 81.3 Producing fields 29.3 27.9 Other 0.8 4.4 Total 147.6 113.6 « Increase in PPE depreciation due to full six months contribution of Contact « Goodwill no longer amortised under A-IFRS Origin: Page #2
Slide 14: Funding & Interest
Funding & Interest Six months ended Dec 05 Jun 05 Dec 04 ($m) ($m) ($m) Net debt ($m) 2,673 2,743 2,742 Total equity ($m) 3,782 3,516 3,389 Net debt to equity (%) 71% 78% 81% Debt to (debt + equity) (%) 41% 44% 45% Net interest expense ($m) 87 135 53 Net interest cover (x EBIT)* 4.5 4.2 5.3 Average
Slide 15: Operating cash flow
Operating cash flow Dec 05 ($m) Dec 04 ($m) EBITDA 589 441 Change in working capital (9) (38) Stay-in-business capex (net*) (134) (55) Other (incl. non-cash items) 19 18 Tax (44) (64) OCAT 421 301 Net interest paid (93) (54) Free cash flow 328 247 * OCAT ratio for calendar 2005 is 13.6% * Increase i
Slide 16: Growth capex for major development projects increased
Growth capex for major development projects increased... Dec 05 ($m) Dec 04 ($m) Stay-in-business 105.5 56.4 Growth Exploration & Production 223.9 142.4 Retail 11.0 11.4 Generation 6.7 3.5 Networks - - Contact 12.0 10.3 Total capital expenditure 359.1 224.0 Acquisitions 66.5 967.5 Capex including ac
Slide 17: Cash flow returns from business segments
Cash flow returns from business segments are measured at pre-tax and targets of 14.3% over a full year Funds Operating OCFR OCFR Employed Cashflow Dec 05 Dec 04 ($m) ($m) (%) (%) Half year returns* Exploration & 1,357 104.9 7.7% 6.3% Production Retail 1,262 94.2 7.5% 11.1% Generation 323 23.1 7.1% 7
Slide 18: Interim fully franked dividend declared
An interim fully franked dividend of 9 cents per share has been declared (prior period 7 cents fully franked) 18 Dividends - cents per share 16 5 Page t7 Franking 400% 100% 40% 100% 100% 100% Fy 01 FYO2 FY03 FY04 FYO5 FY 06 §% Dec half © Jun half Payment and DRP « Ex-dividend date 23 February « Date
Slide 19: Operating Review
Operating Review
Slide 20: Exploration & Production: EBITDA of $98.7m down 16%
Exploration & Production: EBITDA of $98.7m down 16% due to non-recurring items in 2004 ... 250 300 mDec-05 2Dec-04 | 206 4 156 4 106 4 Total Segment Revenue f& EBITDA Sm) 36 4 Revenue EBITDA * Excludes acquisitions Capex * (wig) xade * 2004 includes a $9.4m adjustment of Moomba insurance claim under
Slide 21: Development of the Otway Gas and BassGas projects
Development of the Otway Gas and BassGas projects progressed during the half... Otway Gas Project (29.75%) BassGas Project (42.5%) + Project 70% complete at 31 « Acquired an additional 5% interest December 2005 + With the Safe Astoria on site, defect + HDD 100% complete and rectification work has +
Slide 22: Coal Seam Gas developments
Coal Seam Gas developments Page 21 Spring Gully production increased to 35 TJ/day Ongoing investment in the Spring Gully project will increase capacity to 75 TJ/day in the medium term Acquired 42% interest in the Argyle Coal Seam Gas Project with net 2P reserves of 117 PJ in February 2006 (adjacent
Slide 23: Kupe Gas Project planning and development
Planning and development of the Kupe Gas Project has progressed and new exploration permits secured in ... S Mocks Kupe Gas Project (50%) « Two new permits granted adjacent to PEP 38485 Offshore drilling contract awarded for the development of three wells. Drilling program planned for first half 200
Slide 24: Retail: EBITDA of $142.2 million down 11%
Retail: EBITDA of $142.2 million down 11% due to lower electricity margins and higher customer acquisition costs... Total Segment Revenue ($m) Page 23 Revenue EBITDA Capex* *excludes acquisitions 200 + 180 + 160 + 140 + 120 + 100 (w$) xede> 3 VOLIG Segment revenue remained flat due to the impact of
Slide 25: Gas and LPG volumes slightly higher, electricity volumes down
Gas and LPG volumes slightly higher however electricity volumes down ... Product information and % Natural Gas Electricity LPG change from Dec 04 Revenue (ASm) 460 (41%) 843 (-3%) 277 (+9%) Gross margin (A$m) 85 (49%) 139 (-9%) 73 (-1%) Sales (PJ) 62 (+1%) - - Sales (TWh) - 7.8 (-5%) - LPG (Ktonnes)
Slide 26: Contract market softened short term, strengthened in longer dates
The contract market has softened in the short term but strengthened in longer dates Victorian Spot and Forward Contract Electricity Prices CEI Moreh Average 379 Spor Puice Sa a le i Slee ele smmmntokny 5 cay uciage Spx Price Ce ef es eed etal eta - - | - OG Forwaré curve 2008 Historrcal saat ft—[] [
Slide 27: Customer numbers increased by 39,000 since December 2004
Customer numbers increased by 39,000 since December 2004... Mass Market Churn: Completed & Pending 55% 1 vic tee Vie Gas vorerre NSW Elec cove SVE Gas A 508 | fees ctee vonmnsé Gas & Churn: Monthly data annualised Customers Natural | Electricity (‘000) Gas Dec-04 918 856 Dec-05 904 909 Net Change {1
Slide 28: Warmer temperatures and high LPG prices curtailed contributions
Warmer temperatures and continued high LPG prices has curtailed contributions ... Average International Propane Price (CP) Prepane price (SA} Jul-04 Jul-Dec-64 AS534 TNH Jan-Jun-O5 A$503 —————. Jar0S Jul-Dec-05 AS615 — > dut-05, Cost of LPG (CP) averaged AS615/tonne over period (increase of 15% on p
Slide 29: Generation: EBITDA of $43.1 million up 45%
Generation: EBITDA of $43.1 million up 45% from higher capacity payment and higher plant availability 80 | mDec-05 | He Dec-04 L nN w bd wa an ~~ oS Lod Qo oS oS Lod L 1 Ll L 1 Ll = fo] 1 Total Segment Revenue & EBITDA ($m) Lod 1 * Revenue EBITDA Capex * excludes acquisitions Page 28 25 {uss} xade9
Slide 30: Exceeded contracted and market targets except Bulwer Island and Ladbroke Grove
Exceeded all contracted and market targets with the exception of Bulwer Island and Ladbroke Grove ... Major Origin | Origin | Capacity | Type | Operation | Availability | Contracting Power Int. % MW Party Plants Worsley 50 120 Cogen | Base 98% Western Power & Worsley Bulwer Is. 50 32 Cogen | Base 91
Slide 31: Networks: EBITDA of $15.8 million down 16%
Networks: EBITDA of $15.8 million down 16% due to change in accounting treatment of the Envestra distribution 90 t 0.6 ss . : * Sales revenue in line with prior period 7 0.5 + Distribution from Envestra l 0.4 unchanged however accounting treatment has changed Consumers connected increased by 11,600
Slide 32: Contact: EBITDA of $289.5 million up 151%
Contact: EBITDA of $289.5 million up 151%... 1200 350 * Completed acquisition of 51.4% ma Dec-05 interest on 1 October 2004. Results 1000 4 iDec-04 | 399 for Dec-05 includes full six months € compared to three months in Dec-04 wv mi = , 250 w 3 800 5 a + Sale of Valley Power peaker station g | 500 m
Slide 33: Outlook
Outlook
Slide 34: Outlook
Page 33 Outlook Profit over the first half was enhanced by a full six months contribution from Contact and an increased contribution from Generation Assuming current market conditions prevail, earnings for the full year are expected to be 10-15% higher than the recurring A-IFRS earnings in the prior