Chesapeake Utilities Corporation · NYSE:CPK
Chesapeake Utilities — Non-Deal Roadshow (August 2020)
31 slides from Chesapeake Utilities's roadshow presentation, Aug 25, 2020
Slide 1: Wells Fargo Virtual Road Show August 25-26, 2020
Exhibit 99.1 Commitment Growth Leadership Safety Sustainability Solutions Driven By Energy Strength Team Wells Fargo Service Virtual Road Show August 25-26, 2020 Performance Community ValueExhibit 99.1 Commitment Growth Leadership Safety Sustainability Solutions Driven By Energy Strength Team Wells
Slide 2: Forward Looking Statements and Other Disclosures
Forward Looking Statements and Other Disclosures Safe Harbor Statement: Some of the Statements in this document concerning future Company performance will be forward-looking within the meanings of the securities laws. Actual results may materially differ from those discussed in these forward-looking
Slide 3: Driven by Energy. Delivering Energy
Driven by Energy. Delivering Energy Annual Five Year Performance thru June 30, 2020 Shareholder Return Return 11.3% on Equity Earnings 11.7% Retention Dividend 56.9% Growth EPS 8.9% Growth Cap Ex/Total 8.4% Capitalization 21.7% 3Driven by Energy. Delivering Energy Annual Five Year Performance thru J
Slide 4: Business Overview
Business Overview Diversified Energy Delivery Business Natural Gas Transmission Delaware, Maryland, Pennsylvania, Florida Midstream Natural Gas Distribution 38% Delaware, Maryland, Florida 81% Electric Distribution Florida Propane Distribution and AutoGas Delaware, Maryland, Pennsylvania, Virginia,
Slide 5: Commitment to Employees, Customers and Communities
Commitment to Employees, Customers and Communities Investors/Financial Employees Community • Premium pay to field employees through June • Chrome books for children of employees to do their school work • Reaffirm 2022 EPS target $4.70 to $4.90 and • Social distancing protocols in effect along with C
Slide 6: Delivering Solid Results in 2020
Delivering Solid Results in 2020 • Achieved strong second quarter results; solid year- to-date operating earnings across all business units • Operational savings and best practices performance improvements being implemented across functional distribution and transmission businesses in all regions •
Slide 7: Second Quarter Overview
Second Quarter Overview Earnings Per Share Second Quarter Year-to-Date 2020 2019 2019 2020 $ 0.66 $ 0.50 $ 2.42 $ 2.25 Strong performance for the first half of 2020 : • Continued growth in the Company's businesses • Addition of the Boulden acquisition • Retail propane margins per gallon • Expense ma
Slide 8: Key Business Factors: COVID-19 Impact
Key Business Factors: COVID–19 Impact • Chesapeake Utilities is an “essential business” to our customers and communities. As such, our operational activities and construction projects continue; all the while, we are adhering to safety guidelines and social distancing. • The Company’s pandemic respon
Slide 9: Capital Expenditures Forecast Estimate for 2020
Capital Expenditures Forecast Estimate for 2020 Forecast for Fiscal 2020 (dollars in thousands) Low High Regulated Energy: Natural gas distribution $ 75,000 $ 80,000 Natural gas transmission 70,000 80,000 Electric distribution 5,000 7,000 Total Regulated Energy 150,000 167,000 Unregulated Energy: Pr
Slide 10: Recent and Current System Expansions
Recent and Current System Expansions Natural Gas Services to New Territories Projects Underway Recently Completed ESNG 2017 Northwest Florida System Expansion Expansion Project (Delmarva Del-Mar Energy West Palm Beach Peninsula Pathway County Expansion Expansion (Florida) Full Service Q4 Full Servic
Slide 11: Major Projects and Initiatives Gross Margin Contributions
Major Projects and Initiatives Gross Margin Contributions 11Major Projects and Initiatives Gross Margin Contributions 11
Slide 12: Elkton Gas Company Summary of Transaction
Elkton Gas Company Summary of Transaction Acquisition Completed • Chesapeake Utilities and South Jersey Industries completed the agreement for the acquisition of Elton Gas Company at a price of approximately $15 million on July 31, 2020. • Elkton Gas serves approximately 7,000 customers within a fra
Slide 13: Indicative RNG Scenario on the Delmarva Peninsula
Indicative RNG Scenario on the Delmarva Peninsula Across the CPK Value Chain Composting Plant Organic Fertilizer generates Raw Compost Fertilizer Landfill Renewable Natural Gas Poultry Farms processes (RNG) can be flared off, generate or processed and Chicken Waste & Waste Water cleaned and ultimate
Slide 14: CPK's Renewable Natural Gas Proposition Presents Multiple Investment Opportunities
CPK’s Renewable Natural Gas Proposition Presents Multiple Investment Opportunities Distribution Transmission Marlin Operations Operations Potential investment Additional Interstate pipeline in gas processing transportation Investment interconnects for equipment which we equipment to receipt of renew
Slide 15: Key Regulatory Initiatives
Key Regulatory Initiatives Hurricane Michael Limited Proceeding • October 2018 Hurricane Michael – Northwest Florida • August 2019 FPU filed limited proceeding with Florida PSC • Fourth Quarter 2019 FPU and the Office of Public Counsel filed a request to approve interim rates • FPU continues to work
Slide 16: Capital Capacity to Support Future Growth
Capital Capacity to Support Future Growth Available Financing Capacity • $370 million bank lines of credit through (in thousands) October 2020 Stockholders' Equity Long-Term Debt Short-Term Debt * * • $95 million incremental liquidity if needed $1,500,000 through October 2020 $1,325,388 $1,294,716 •
Slide 17: ESG Stewardship
ESG Stewardship • We remain steadfast in our commitment to environmental, social and governance stewardship. • The key to our success is our strong culture that fully engages all of our team members. • We are a responsible company that promotes safety, integrity, accountability and reliability • Our
Slide 18: ESG At Our Core
ESG At Our Core Women in Utilities Webinar – Be Extraordinary Measures to help keep employees, Everyday by Demonstrating Diversity. customers and communities safe and Equity, Diversity healthy during the COVID-19 pandemic. and Inclusion Council Promotes During these extraordinary times, we are honor
Slide 19: Driving Our Actions
Driving Our Actions Focus on Shareholder Value and Growth • High standards of safety and operational performance. • Optimize growth opportunities within rate, customer demand and market constraints • Maintain a regulated/ unregulated business mix designed to produce better than utility returns and a
Slide 20: Capital Investment Guidance
Capital Investment Guidance Continued Record Investment in Our Business to Drive Growth $350,000 Target 2018 – 2022 : $750 million - $1 billion $303,153 $300,000 $282,861 $250,000 $215,000* $250,000 Reach $1 billion $198,986 $200,000 $30,000* $150,000 $185,000* $100,000 $50,000 Reach $750 $53,153 $0
Slide 21: Reaffirm Current Earnings Guidance
Reaffirm Current Earnings Guidance 2022 EPS Target Range of $4.70 - $4.90 $5.00 $4.90 On February 26, $0.20 2020, we updated our EPS guidance $4.55 based on our $4.50 current strategic $0.35 plan planned investments and growth prospects. $4.00 $4.70 We are continuing to monitor the COVID- $4.20 19 i
Slide 22: Closing Remarks
Chesapeake Utilities Closing Remarks • Strong earnings for the second quarter despite the uncertain challenges of the COVID-19 pandemic. • Engaged in expense management across the Company and operational efficiency in this new business normal situation. • Excited about our recently completed Elkton
Slide 23: Thank You!
Thank You! Beth Cooper Thomas E. Mahn Executive Vice President, Vice President and CFO and Asst. Secretary Treasurer bcooper@chpk.com tmahn@chpk.com Joseph D. Steinmetz Michael Galtman Vice President and Vice President and Controller Chief Accounting Officer jsteinmetz@chpk.com mgaltman @chpk.comTha
Slide 24: Appendix: Long-Term Track Record Performance Metrics Driving Shareholder Return
Appendix Long-Term Track Record Performance Metrics Driving Shareholder ReturnAppendix Long-Term Track Record Performance Metrics Driving Shareholder Return
Slide 25: Key Performance Metrics
Key Performance Metrics Financial Discipline Driving Growth and Performance Chesapeake Percentiles compared to Performance Metrics Chesapeake Results Performance Peer Group For periods ending 06/30/20 unless otherwise noted 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10 Year Capital Expenditur
Slide 26: Continuing to Build for the Future
Continuing to Build for the Future Organic Growth Opportunities Supplemented with Targeted Acquisitions Historical Cap Ex & Acquisitions In Millions Cumulative Cap Ex since 2015: $1.037 Billion Cumulative Cap Ex since 2009: $1.568 Billion $300 $283 $250 $195 $191 $199 $200 $169 $154 $150 $108 $98 $1
Slide 27: Growth in Earnings per Share
Growth in Earnings per Share 13 Years of Record Earnings st For Periods Ended December 31 Basic GAAP Earnings per Share $4.50 $3.97 $4.00 $3.56 $3.46 $3.50 $2.87 $3.00 $2.73 $2.48 $2.50 $2.27 $2.01 $1.93 $2.00 $1.83 $1.45 $1.50 $1.00 $0.50 $- 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 27
Slide 28: Strong Track Record of Dividend Growth
Strong Track Record of Dividend Growth Driven by Earnings Growth $2.00 $1.76 $1.80 $1.62 $1.60 $1.48 $1.40 $1.30 $1.22 $1.15 $1.20 $1.08 $1.03 $0.97 $1.00 $0.92 $0.88 $0.80 $0.60 $0.40 $0.20 $- 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 On May 7, 2020, the Board of Directors increased th
Slide 29: Solid Track Record of Higher Return on Equity
Solid Track Record of Higher Return on Equity (ROE) th Consistently Exceeding the Peer Median and 75 Percentile th * 10-Year Peer 75 Percentile – 10.08% * 10-Year Peer Median – 8.86% Return on Equity For the periods ending December 31, 2019 1 Year 3 Year 5 Year 10 Year CPK 12.01% 11.89% 11.84% 11.83
Slide 30: Market Capitalization Increased: Performance is Driving Increased Value
December 31 Stock Price (except 8/24/2020) $1,375 $1,572 $1,332 $1,284 $1,092 $867 $725 $578 $436 $415 $395 $301 $215 Market Capitalization Increased Performance is Driving Increased Value $1,800 $95.83 $100 $90 $1,600 $83.39 $81.30 $78.55 $80 $1,400 $66.95 $70 $1,200 $56.75 $60 $1,000 $49.66 $50 $8
Slide 31: Chesapeake Peer Group Stock Price Analysis
Chesapeake Peer Group Stock Price Analysis 08-21-2020 Closing Price 08-21-2020 Closing as a % of 12/31/19 Price as a % of 52- Closing Price Percentile week High Percentile Peer 1 116.62% 100.00% 97.58% 100.00% Peer 2 90.15% 92.30% 83.28% 92.30% CPK US Equity 86.84% 84.60% 82.16% 84.60% Peer 3 80.30%
Chesapeake Utilities — Non-Deal Roadshow (August 2020) on 6ix