New Fortress Energy Inc. · NASDAQ:NFE
New Fortress Energy — Q3 2019 Earnings Presentation
30 slides from New Fortress Energy's earnings presentation, November 2019
Slide 1: Q3 2019 Investor Presentation
New. Fortress Energy O3 2019 Investor Presentation November 2019 g NewFortress energy
Slide 2: Q3 2019 Company Highlights
Q3 2019 Company Highlights * Based on current nominations, Old Harbour power plant expected to exceed prior consumption estimates; Developments(!) are nearly Jamalco CHP plant achieved “First Fire’) in Q4 2019 complete + Puerto Rico facility expected First Gas) in Q4 2019; San Juan Units 5/6 Run Rat
Slide 3: Current Portfolio
Qeurrent Portfolio QO orerational & Financial Performance
Slide 4: Our Core Business Plan is Clear
Our Core Business Plan is Clear - Establish a “beachhead” in a market that anchors infrastructure development - Focus is to aggregate demand across 3 core sectors: @ Power At @ Industrial las ©) Transportation"? .£<—— rasan «ks Terminal
Slide 5: Proven Strategy in Jamaica
Proven Strategy in Jamaica [ NFE is aggregating demand by deploying downstream capital & developing flexible infrastructure | - We built a terminal in a location where the need for LNG is significant @ We identified and established a “beachhead” in a core target market @ We constructed a terminal to
Slide 6: Target Demand for Core Terminals
Target Demand for Core Terminals [ We expect to sell between 1mm and 3mm GPD through each terminal Jamaica Puerto Rico Mexico Total (in GPD) Committed Volumes 1.2mm 0.9mm 0.5mm 2.6mm In Discussion Volumes 0.4mm 0.6mm 0.5mm 1.5mm Estimated Market("®) >6.0mm >11.0mm >2.0mm [ We are currently addressin
Slide 7: Illustrative Committed Volumes Operating Margin Goal
Illustrative Committed Volumes Operating Margin Goal!'® 17) As Committed Volumes come online, revenue & Illustrative Operating Margin are expected to increase substantially Mexico First Gas — $338 Mexico Puerto Rico + Jamalco CHP reach Run Rate $284 L____ reaches Run Rate Old Harbour volumes ramping
Slide 8: New Terminals Development
Qeurrent Portfolio OQvew Terminals @Q development QO orerational & Financial Performance
Slide 9: Terminals are Completed or Under Construction
4 Terminals are Completed or Under Construction Our goal is to be Committed on 10 Terminals by YE 2020 & have them Operational by YE 2021 - 10 core markets of interest - Approximately 50 countries in need of terminals(? - 100 potential terminal sites worldwidel©) Status Terminals Operating 3 Under C
Slide 10: Illustrative Terminal Unit Economics
Illustrative Terminal Unit Economics(2") Goal is to achieve ~$1bn to ~$3bn of Operating Margin in 2022 once 10 terminals reach Run Rate - Assuming 1mm to 3mm GPD of Target Volume”) at similar margins, our targeted portfolio of 10 terminals by year-end 2020 could generate ~$1bn to ~$3bn of Operating
Slide 11: Operational & Financial Performance
Qeurrent Portfolio Q ew Terminals OQ evelopment QO orerational & Financial Performance 10
Slide 12: Key Developments to be Operational in Days
Key Developments to be Operational in 90 Days — Offshore regasification terminal fully commissioned Old Harbour Run Rate by 9 , . ” a Power Plant Year-End(24) Power plant turbines Operational and will likely consume more gas than expected Po —————— Jamalco CHP Run Rate in Turbine “First Fire” in Oct
Slide 13: Terminal Projects Progressing on Time
Terminal Projects Progressing on Time ~80% of our Committed Volumes come from 5 projects Committed Project Ownership Status First Gas Run Rate i i “ 3 la NOS SL pit "i : 27 MW add-on to 120 MW power plant (Conversion) JPS 100% Operational Achieved Achieved 190 MW power plant (New Build) SJPC 100% Op
Slide 14: Industrial Customer Demand Aggregation
Industrial Customer Demand Aggregation(2°) r L Our terminals help catalyze the rapid adoption of industrial gas-fired power Cc - 15 6 new customers turned online since Q3 2018 : 86k GPD - - : . Operational Truck, rail, and ship LNG throughout Florida and the Caribbean ee, C— 10 Targeting a 6-month t
Slide 15: Operational & Financial Performance
Qeurrent Portfolio QO overational & Financial Performance 14
Slide 16: Operational Asset Performance
Operational Asset Performance [ In 2019, our customers will reduce emissions by ~30%, the equivalent of planting 4mm trees'7®) Health, Safety, & Environment (“HSE”) Availability Reliability LNG Truck & Ship Transfers Achieved “three zeros” for HSE incidents for operating assets\29) Y Zero (0) days a
Slide 17: Gas & Shipping: What a Difference a Year Makes
Gas & Shipping: What a Difference a Year Makes - LNG supply has risen modestly - Demand will come; it just takes time - Inability to easily store the commodity leads to price volatility Sept. 2018 Today Macro (32) la Global LNG Capacity (MTPA) 389 Bix 448 . New Supply Announcements MTPA™? - 110 Capa
Slide 18: Financial Performance
Financial Performance Operating Results Financial Metrics Volumes: down slightly for the quarter due to planned maintenance at the Bogue Power Plant + We expect ~0.6mm GPD in Q4 and over 2.6mm GPD in 2020 Revenue: up by $10mm from Q2; timing anomalies will normalize as Committed Volumes come online
Slide 19: Balance Sheet Management
Balance Sheet Management - Since the beginning of the year, we have increased our debt from $500mm to $680mm, and expect to increase it by another $300mm in the next 60 to 90 days(4°) - Our goal is to internally finance growth with no additional equity raises - ~$1.5bn of borrowing capacity assuming
Slide 20: Appendix
Appendix
Slide 21: Operating Margin Reconciliation
Appendix Operating Margin Reconciliation (in thousands) 02-19 Q3-19 Net income/(loss) $ (13,681) $ (51,233) $ (54,424) Add: Selling, general and administrative 13,423 32,169 40,913 Depreciation and amortization 830 2,110 1,930 Interest expense 3,183 6,199 4,974 Other (income) expense, net 270 920 1,
Slide 22: Environmental & Social Governance
Appendix Environmental & Social Governance We are passionate about improving the lives of people around the world ] Over Over Over $SI55K 1,700 2,850 $I140K STI0K_ 1,700 USD given children provided students attended USD invested in USD students and inscholarships with financial cid back-to-school fa
Slide 23: Disclaimers
Disclaimers IN GENERAL. This disclaimer applies to this document and the verbal or written comments of any person presenting it. This document, taken together with any such verbal or written comments, is referred to herein as the "Presentation." FORWARD-LOOKING STATEMENTS. Certain statements regardi
Slide 24: Endnotes
Endnotes Certain of the below Endnotes include forward-looking statements. Please see our note regarding "Forward-Looking Statements” onthe slide titled “Disclaimers” of this Q3 Investor Presentation (together with the call discussing this supplement scheduled for November 12, 2019, the “Presentatio
Slide 25: Endnotes
Endnotes (6) “Committed Volumes" or references to Commitments means our expected volumes to be sold to customers under binding contracts, non-binding letters of intent, non- binding memorandums of understanding, binding or non-binding term sheets or have been officially selected as the winning provi
Slide 26: Endnotes
Endnotes (11) This is based on an assumed leverage ratio of 4.0x. It is calculated by multiplying the leverage ratio of 4.0x by the Illustrative Annualized Operating Margin Goal of $382 with respect to the Committed Volumes as of Q4 2020, as illustrated on Slide 6. Borrowing capacity described repre
Slide 27: Endnotes
Endnotes (17) Operating Margin" is a non-GAAP financial measure. For a reconciliation of Operating Margin as well as an explanation of this measure, please see the Appendix to this Presentation. As used in this Presentation, Operating Margin means the sum of (i) Net income / (loss), (ii) Selling, ge
Slide 28: Endnotes
Endnotes (21) This slide is an illustration of Terminal economics given the assumptions addressed on the slide and related endnotes. References to volumes, margins related to such volumes, and the Illustrative Operating Margin Goal related to such volumes (i) are not based on the Company's historica
Slide 29: Endnotes
Endnotes (27) Includes certain of our commercial and industrial In Discussion Volume customers in Florida, Jamaica, Puerto Rico and Mexico. We cannot assure you if or when we will enter into contracts for sales of additional volumes, the price at which we will be able to sell such volumes, or our co
Slide 30: Endnotes
Endnotes (38) ‘Total Debt’ means the aggregate principal amount of the New Term Loan Facility and the South Power Bonds, excluding deferred financing costs, in footnote 15 to the financial statements provided in our forthcoming quarterly report on Form 10-Q for the period ended September 30, 2019, o