Keyera Corp. · TSX:KEY
Keyera — Investor Presentation (March 2021)
18 slides from Keyera's investor presentation, March 2021
Slide 1: Investor Presentation March 2021
Investor Presentation March 2021 CONNECTING ENERGY FOR LIFE 1
Slide 2: Forward-Looking Information & Non-GAAP Measures
Forward-Looking Information & Non-GAAP Measures In the interests of providing Keyera Corp. (“Keyera” or the “Company”) shareholders and potential investors with information regarding Keyera, including management’s assessment of Keyera’s future plans and operations, its financial outlook and future p
Slide 3: Why Invest in Keyera?
Why Invest in Keyera? Compelling Risk-Adjusted Returns ESG Financial Dividend High-Quality Value Creation Focused Strength Sustainability Assets Track Record 8% yield; aim to High barrier-to-entry Clearly defined SASB aligned Low leverage of 2.9X steadily grow assets with access to financial framewo
Slide 4: ESG is a Top Priority
ESG is a Top Priority Long-Term Value Creation Is Consistent with Strong ESG Performance “OUTPERFORMER” “GLOBAL ESG “#1 ESG “A” RATING Sustainalytics1 BEST IDEA” PERFORMER” MSCI4 RBC2 Scotiabank3 KEYERA CAN PLAY A LEADING ROLE IN THE TRANSITION TO A LOW CARBON ECONOMY E S MATERIAL FACTORS Emissions
Slide 5: Strong Financial Position
Strong Financial Position 2.9x Net debt1 to adjusted EBITDA2 LONG-TERM DEBT MATURITIES (C$ MM)3 (excludes drawings under revolver) Conservative payout ratio2 59% (Target of 50% - 70%) Private Notes Investment grade credit ratings Minimal long-term debt maturities DBRS Limited: BBB, Stable in next 5
Slide 6: Prudent Financial Framework
Prudent Financial Framework 5 Year Financial Priorities Target 2020 Avg3 Credit ratings BBB BBB/BBB- n/a Preserve Net Debt / Adjusted EBITDA1,2 2.5x - 3.0x 2.9x n/a financial flexibility Long-term dividend Payout Ratio1 50% - 70% 59% 61% Fee-for-Service contribution of > 75% 69% 71% Continue discipl
Slide 7: Managing Cash Flow Stability
Managing Cash Flow Stability Realized Margin from Investment Grade Customers and Take-or-Pay Contracts MANAGED THROUGH ~32% Non-Investment Grade ~30% Non Fee-for- Service RISK MANAGEMENT PROGRAM Fee-for- PROTECTING ~70% Service DOWNSIDE ~68% Investment Grade (75% including PRESERVING secured UPSIDE
Slide 8: Clear Capital Allocation Priorities
Clear Capital Allocation Priorities Strong Focus On Total Shareholder Returns 1 PRESERVING BALANCE SHEET STRENGTH Maintain Investment Grade Credit Ratings Low Leverage and Financial Flexibility Rated by DBRS and S&P Target net debt to adjusted EBITDA between 2.5-3.0x1 2 NON – DISCRETIONARY FUNDING C
Slide 9: Sustained Dividend Growth Through Capital Discipline
Sustained Dividend Growth Through Capital Discipline Target Payout Range 50-70% of Distributable Cash Flow Financial Commodity COVID-19 Crisis Price Collapse Pandemic 9% DCF/sh CAGR1,3 DCF/sh Portion of DCF/sh paid as Dividends $3.26 DCF/sh 15.0x Since ‘08 Net Debt to adjusted EBITDA2,3 13.0x 7% Div
Slide 10: Returns Focused
Returns Focused ANNUAL RETURN ON INVESTED CAPITAL 25% 25% $9.0 $9.0 $8.0 $8.0 20% 20% $7.7 $7.6 20% $7.0 $7.0 $6.8 $6.0 $6.0 15% 15% 15% 10% - 15% $5.0 $5.0 Annual Target Range $5.7 ROIC (%) $4.6 $4.0 $4.0 10% $4.2 10% 10% $3.6 $3.0 $3.0 Capital In-Service $2.7 $2.0 5% $2.0 5% ($ billion)5% $1.0 $1.
Slide 11: Keyera's Integrated Value Chain
Keyera’s Integrated Value Chain High Barrier-To-Entry Asset Base With Access To High Value Markets Raw Natural Spec External Gas Gas Liquids Product Markets CUSTOMERS CUSTOMERS Gathering & Processing Liquids Infrastructure Marketing Infrastructure • Strategically located gas plants • Highly utilized
Slide 12: Delivering Energy Infrastructure Solutions
Delivering Energy Infrastructure Solutions Focused On Maximizing Customer Netbacks Energy Infrastructure + Marketing Global B.C. A.B. ALBERTA Macro Drivers LNG Canada ESG OIL SANDS Natural Gas (C1) LOW-EMISSIONS ENERGY SOURCE MONTNEY ESG MEDICAL GRADE PLASTIC, Liquids Ethane (C2) STERILE PACKAGING C
Slide 13: KAPS – Liquids Pipeline Solution
KAPS – Liquids Pipeline Solution A L B E RTA OIL SANDS Pipestone MONTNEY KAPS pipeline system highly desired by industry Grande Prairie Expected construction period - 2021 to 2023* Provides secure, long-term cash flow with 75% take-or-pay Wapiti Creates a new platform for growth Leads to further int
Slide 14: Playing A Role In The Energy Transition
Playing A Role In The Energy Transition ALBERTA Solvents Carbon Capture • Help decarbonize oilsands & Storage MONTNEY Fort McMurray production through the supply of solvents such as propane and • At 6 of our existing locations1 OIL SANDS butane • Potential to provide CCS services for customer Grande
Slide 15: 2021 Guidance
2021 Guidance $45 – $65 Million in Annual Cost Reductions, Mostly Realized by The End of 2021 2021 Guidance Project Completion Schedule Growth Capital Expenditures $400-$450M Ricinus Gas Plant Suspension Mid-2021 Maintenance Capital Expenditures $25-$35M Brazeau North Gas Plant Suspension Mid-2021 C
Slide 16: Why Invest in Keyera?
Why Invest in Keyera? Compelling Risk-Adjusted Returns ESG Financial Dividend High-Quality Value Creation Focused Strength Sustainability Assets Track Record 8% yield; aim to High barrier-to-entry Clearly defined SASB aligned Low leverage of 2.9X steadily grow assets with access to financial framewo
Slide 17: Contact Information
Contact Information Dan Cuthbertson Director, Investor Relations Calvin Locke, P.Eng, MBA Manager, Investor Relations Beata Graham, CPA, CMA Senior Analyst, Investor Relations Keyera Corp. 888-699-4853 Sun Life Plaza West Tower 200, 144 4 Avenue SW Calgary, Alberta ir@keyera.com T2P 3N4 www.keyera.c
Slide 18: Notes
Notes Slide 3 and 16 All information as at December 31, 2020, unless otherwise stated. 1. Not a standard measures under GAAP. See “Forward-Looking Information & Non-GAAP Measures” slide. 2.Net Debt to Adjusted EBITDA calculation for covenant test purposes excludes 100% of the company’s subordinated