Atlas Arteria · ASX:ALX
Atlas Arteria — Macquarie Atlas Roads — UBS Australian Emerging Companies Conference 2011
26 slides from Atlas Arteria's conference presentation, Apr 7, 2011
Slide 1: Macquarie Atlas Roads - UBS Australian Emerging Companies Conference
MACQUARIE ATLAS ROADS UBS AUSTRALIAN EMERGING COMPANIES CONFERENCE 7 APRIL 2011
Slide 2: Disclaimer
Disclaimer Disclaimer Macquarie Atlas Roads (MQA) comprises Macquarie Atlas Roads Limited (ACN 141 075 201) (MARL) and Macquarie Atlas Roads International Limited (Registration No. 43828) (MARIL). Macquarie Fund Advisers Pty Limited (ACN 127 735 960) (AFSL 318 123) (MFA) is the manager/adviser of MA
Slide 3: Disclaimer
Disclaimer Hong Kong This document has been prepared and intended to be disposed solely to "professional investors" within the meaning of the Securities and Futures Ordinance (Cap. 571) of Hong Kong for the purpose of providing preliminary information and does not constitute any offer to the public
Slide 4: Agenda
Agenda 1. Overview 2. Unlocking Value 3. Wrap-up 4. Questions 5. Appendix Note: Dollar amounts throughout the presentation are Australian Dollars unless stated otherwise 4
Slide 5: 1. Overview
1. Overview
Slide 6: MQA snapshot
MQA snapshot MQA was created out of the restructure of Macquarie Infrastructure Group into two separate ASX-listed toll road groups, MQA and Intoll 2011 Listing Date 25 January 2010 Market Capitalisation1 A$866,242,412 Shares on Issue 452,345,907 ASX Ranking Top 200 Outperformance since listing2 208
Slide 7: MQA portfolio
MQA portfolio MQA’s toll road investments are located in France, UK, USA and Germany Weighted Average Length of Concessions Remaining 32 Years1 1. Weighted by proportionate EBITDA. APRR’s remaining concession life is 22 years, with the weighted average concession life of the remainder of the portfol
Slide 8: MQA structure
MQA structure … protects asset values and is integral to its strategy MQA has no corporate level debt and $31.9m cash1 Each asset is in a separate holding company structure All asset level debt is project finance, with no recourse to MQA or any other portfolio asset There are no cross-defaul
Slide 9: MQA strategy
MQA strategy Yield stock Sustainable dividend stream Refinance assets at suitable opportunity T Enhance the three core MEN assets GE N A A Deliver growth in ALM existing portfolio P IT CA E D Value recovery stock LIN CI P DIS Assets requiring substantial operational and financial management to maxim
Slide 10: 2. Unlocking Value
2. Unlocking Value
Slide 11: Unlocking near term value
Unlocking near term value APRR is MQA’s largest and most important asset APRR provides the potential to deliver consistent long term dividends to MQA. The key to unlocking value is the successful refinancing of Eiffarie (APRR Holdco) debt — Consortium debt at Eiffarie matures in February 2013 wi
Slide 12: Refinancing plan
Refinancing plan Status Comments 3 Minority acquisition materially reduces refinancing risk 3 Financial advisor appointed January 2011 issuance of €1.05bn bonds commences building of liquidity at APRR: - Lengthens maturity profile at APRR 3 - Facilitates distribution of profit to Eiffarie - Provides
Slide 13: Outlook on refinancing
Outlook on refinancing Continued growth throughout economic downturn and 2008 oil spike APRR’s resilient performance recognised by Increased shareholding and fiscal consolidation credit markets - €1.25bn bonds issued since materially improve Eiffarie’s cash flows Jan 10 Eiffarie debt expected
Slide 14: Unlocking long term value
Unlocking long term value Excluding APRR, MQA has a weighted average concession life of 53 years1 CityLink Westlink M7 ConnectEast Warnow Tunnel M6 Toll Dulles Greenway Indiana Toll Road Chicago Skyway 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100 2110 1. Weighted by proportionate EBITDA. APRR’s
Slide 15: Natural de-levering over time
Natural de-levering over time 40.0x Net debt / EBITDA (x) Illustrative reduction in leverage multiple through growth in EBITDA1 Using actual Concession term 35.0x net debt as at remaining as at 31 Dec 2010 31 Dec 2030 30.0x 2010 20301 M6 Toll2 23.1x 5.8x 23 25.0x 20.0x Dulles 17.6x 4.4x 25 Greenway
Slide 16: Refinancing landscape
Refinancing landscape Favourable maturity profile provides >4 year window to plan and execute refinancings 6,000 63.7% 5,000 Debt maturing (A$m) 4,000 3,000 2,000 19.4% 1,000 7.6% 3.3% 2.4% 0.6% 0.7% 0.8% 0.8% 0.8% 0 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020+ M6 Toll Greenway Skyway ITR Rost
Slide 17: Credit market trends
Credit market trends Western Europe Loan Volume 500 400 - 75% US$ bn 300 + 68% 200 100 - 2Q03 4Q03 2Q04 4Q04 2Q05 4Q05 2Q06 4Q06 2Q07 4Q07 2Q08 4Q08 2Q09 4Q09 2Q10 4Q10 Investment grade loans Leveraged loans US Loan Volume 500 - 69% 400 US$ bn + 56% 300 200 100 - 2Q03 4Q03 2Q04 4Q04 2Q05 4Q05 2Q06 4
Slide 18: 3. Wrap-Up
3. Wrap-Up
Slide 19: MQA valuation considerations
MQA valuation considerations APRR is MQA’s largest asset APRR + Dulles Greenway + M6 Toll + Non-Core Assets = MQA Not including the value in assets other than APRR/Eiffarie, MQA’s market capitalisation1 would imply an APRR/Eiffarie valuation at ~10.4x EV/EBITDA as at December 2010. Metrics will cont
Slide 20: The road ahead
The road ahead APRR is key to releasing yield for MQA investors with remaining value in portfolio to contribute incremental value in medium to long term Jun 2011 Dec 2011 Jun 2012 Dec 2012 2010 APRR Minority Acquisition Disciplined Capital Management 5.4% growth in EBITDA APRR Debt issuance and liqu
Slide 21: Management's outlook
Management’s outlook Overall positive trend in portfolio’s 2010 results expected to continue in 2011 — Current high oil prices may cause short-term softness in light vehicle traffic across the portfolio with further potential softness on UK traffic over the next 12-18 months due to austerity measu
Slide 22: 4. Questions
4. Questions
Slide 23: Appendix
Appendix
Slide 24: APRR/Eiffarie
APRR/Eiffarie Concession expiry 31 December 2032 (APRR, AREA) 31 December 2042 (Maurice Lemaire) 31 December 2060 (ADELAC) Tolling Escalation by 0.5% in 2010 85% of inflation (CPI ex tobacco) plus 0.5% annually to 2013 Taxe d'aménagement du territoire adjustment1 Ownership ~19.44% (hel
Slide 25: Dulles Greenway
Dulles Greenway Concession expiry 15 February 2056 Tolling Fixed toll increases until Dec 2012 From 2013 to 2020, escalate by greater of CPI +1%, Real GDP, or 2.8% By application to the SCC thereafter Ownership 50% estimated economic interest Length 22km Location / Strategic Located in
Slide 26: M6 Toll
M6 Toll Concession expiry 31 January 2054 Tolling Market based tolling Ownership 100% Length 42 km Location / Bypasses the City of Birmingham and Strategic the M6 Motorway, one of the most Attraction congested motorways in the UK Significant industrial, housing and economic development o
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