Rgc Resources Inc. · NASDAQ:RGCO
Rgc Resources — Investor Presentation (May 2020)
27 slides from Rgc Resources's investor presentation, May 18, 2020
Slide 1: Investor Presentation May 2020
Investor Presentation May 2020
Slide 2: Forward-Looking Statements
Forward-Looking Statements The statements in this presentation by RGC Resources, Inc. (the "Company") that are not historical facts constitute “forward- looking statements” made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995 that involve risks and uncer
Slide 3: Agenda
Agenda Company Overview Financial Profile Growth Strategy Outlook 2
Slide 4: Organizational Structure
Organizational Structure NASDAQ: RGCO C-Corp formed 1998 Regulated Non-Utility Local Distribution Company Partner in Mountain Valley Pipeline (LDC), located in Roanoke, VA (MVP) Founded in 1883 Partner in proposed MVP Southgate project 3
Slide 5: Roanoke Gas Service Territory
Roanoke Gas Service Territory Serve over 62,200 natural gas customers Customer Count breakdown: Residential 90% C&I 10% Volume breakdown: Residential 40% C&I 60% Note: Total customers as of March 2020. Volume breakdown per most recent fiscal year end. 4
Slide 6: Roanoke Gas Regulated Utility
Roanoke Gas Regulated Utility VA State Corporation Commission (SCC) VA in Top 4 on Forbes “Best States for Business” ranking1 9.44% authorized ROE Highly Stable Alternative Cost Recovery Mechanisms Business Model Weather Normalization Revenue Sharing Infrastructure Riders . SAVE infras
Slide 7: Equity and Debt Profile
Equity and Debt Profile Equity: Top 3 institutional shareholders: $235M Market Capitalization T. Rowe Price 6.4% Common shares issued and BlackRock 4.6% outstanding: 8,136,945 Vanguard 4.2% $40M availability on equity shelf 6.3% insider ownership $15M at the market (ATM) Debt: Re
Slide 8: Shareholder Return
Shareholder Return 76 years dividend payments 16 years dividend increases 5 years record earnings 6.1% dividend increase annual dividend $0.70 (per share) Note: Graph includes stock prices through April 30, 2020. 7
Slide 9: Growth Strategy
Growth Strategy Regulated Utility Investment CapEx Ongoing Regulated Utility Growth Customer Growth Volumes Delivered Non-Utility Investments MVP 8
Slide 10: Roanoke Gas CapEx
Roanoke Gas CapEx Twelve-Months ended March 31: ($000’s) $26,000 $24,000 $24,200 $22,000 $21,200 $21,300 $20,000 $19,400 $18,000 $16,000 $14,000 $12,000 $10,000 2017 2018 2019 2020 9
Slide 11: Roanoke Gas CapEx Fiscal YTD
Roanoke Gas CapEx Fiscal YTD at March 31: $12.5 Fiscal YTD Millions $10.5 $8.5 Other Capital $6.5 $2.4 SAVE 2019 2020 Rider $4.3 $4.5 Customer $2.5 Growth & System Expansion $0.5 $3.7 Total Capital Expenditures $0.6 million or 5% decrease 10
Slide 12: Customers
Customers 2% growth since 2017 Average Customers (twelve-months ended March 31) 61,500 61,000 60,500 60,000 59,500 2017 2018 2019 2020 New customer additions: YTD Fiscal 2020 322 Fiscal 2019 668 Fiscal 2018 598 Fiscal 2017 628 Fiscal 2016 495 11
Slide 13: Natural Gas Volumes
Natural Gas Volumes Volumes Delivered (DTH) Fiscal YTD 2019 Fiscal YTD 2020 3,500 3,000 2,500 2,000 Thousands 1,500 1,000 500 - Residential Commercial Industrial 2020 vs 2019 Highlights Total Volumes (7)% Transportation & Interruptible Volumes 15% Heating Degree Days (HDD) (14)% 12
Slide 14: Earnings Per Share
Earnings Per Share $1.35 $1.39 TTM March 31: $1.25 Six-months ended $1.15 March 31: $1.05 $1.10 $0.95 2020 2019 $0.85 Basic: $1.20 $0.89 $0.86 $0.86 $0.75 Diluted: $1.19 $0.88 $0.65 $0.68 $0.64 $0.55 $0.60 $0.56 $0.45 2017 2018 2019 2020 Dividends/Share 13
Slide 15: Return on Equity
Return on Equity Twelve-Months ended March 31: 12.0% 11.0% 12.9% 10.0% 10.7% 10.8% 9.0% 9.1% 8.0% 2017 2018 2019 2020 14
Slide 16: Outlook
Outlook COVID-19 Strategic Opportunities Economic Development 15
Slide 17: COVID-19
COVID-19 Community Company Liquidity Customer Analyses Earnings Guidance 16
Slide 18: Strategic Opportunities
Strategic Opportunities Strategic Plan M&A Midstream Opportunities CapEx System Expansion 17
Slide 19: Update RGC Midstream Investment
Update RGC Midstream Investment Project 90% complete $30 $20 $57 million projected cash ($mm) $10 $21 $17 investment $13 $6 $0 Thru 2018A 2019A 2020E 2021E Target COD late 2020 Fiscal Year Workers for the Mountain Valley Pipeline weld together sections of pipe near Lindside, WV. (Jenny Harnish
Slide 20: Interconnect into Roanoke Gas Distribution System
Interconnect into Roanoke Gas Distribution System 19
Slide 21: Southgate
Southgate 70 mile natural gas pipeline system 24 and 16 inch steel underground pipe Starts at TRANSCO 165 and extends into central NC Anchored by firm capacity commitment from PSNC Energy Schedule Nov 2018: Filed application Pending FERC approval Feb 2020: FERC issued final EIS Targe
Slide 22: Roanoke Gas Capital Budget
Roanoke Gas Capital Budget $25 $21.9 $22.3 $21.0 $20.0 $20.0 $20 $18.0 $15 Millions $10 $5 $0 2019A 2020E 2021E 2022E 2023E 2024E Forecast totals through 2024: SAVE Infrastructure Replacement $43.2 Customer Growth & System Expansion $33.8 Utility Maintenance $24.3 Total $101.3 21
Slide 23: Roanoke Gas System Expansion
Roanoke Gas System Expansion $4 million line extension Access to over 1,500 potential customers Anticipated service Fall 2020 22
Slide 24: Economic Development
Economic Development Lumber grading facility Mack Trucks (Volvo) will invest $13 adding 4 natural gas- million and hire 250 employees to fired kilns. Capacity to manufacture medium-duty trucks. The Roanoke Times – 1.31.2020 burn additional 210,000 DTH annually. Recycled paper and packaging Company i
Slide 25: Proposed 2.039-Acre Site for Roanoke Gas
PROPOSED 2.039 -ACRE SITE FOR ROANOKE GAS
Slide 26: Economic Development
Economic Development $300 million expansion to Roanoke Memorial Economists say Carilion Clinic Hospital, including new tower for emergency and heart patients, new psych center and parking garage with connected pedestrian adds over $3.2 Billion to skyway. (Times May 2019) Kicked-off fundraising c
Slide 27: Questions
Questions