Apa Group · ASX:APA
Apa — H1 FY2009 Earnings Presentation
27 slides from Apa's earnings presentation, Feb 25, 2009
Slide 1: ASX Release: Interim Results Presentation
For personal use only ASX RELEASE 25 February 2009 The Manager Company Announcements Office Australian Securities Exchange 4th Floor, 20 Bridge Street Sydney NSW 2000 Electronic Lodgement Dear Sir or Madam Company Announcement I attach the following announcement for release to the market: • Interim
Slide 2: Financial Results Half year ended 31 December 2008
For personal use only Financial Results Half year ended 31 December 2008 25 February 2009
Slide 3: Result overview and strategic highlights
For personal use only Result overview and strategic highlights Mick McCormack Managing Director and CEO
Slide 4: Solid first half result
Solid first half result For personal use only Continued strong underlying growth $ million 1H09 1H08 Change 1 Underlying revenue excluding pass-through 367.7 305.5 K 20% Underlying EBITDA 1 248.8 214.7 K 16% Underlying NPAT 1 56.7 44.7 K 27% Reported NPAT 18.0 35.9 L (50)% Underlying OCF 2 122.8 109
Slide 5: Strategic and operational highlights
Strategic and operational highlights Completed the establishment of Energy Infrastructure Investments (EII) For personal use only – Proceeds in excess of book value – Costs to create EII shown as one-off significant items – $647 million used to pay down debt – Strong equity partners – Marubeni Cor
Slide 6: Financial performance
For personal use only Financial performance Ross Gersbach Chief Financial Officer
Slide 7: Solid first half result
Solid first half result For personal use only $ million 1H09 2 1H08 3 Change 1 Revenue 500.7 443.0 13.0% 1 Revenue excluding pass-through 367.7 305.5 20.4% 1 EBITDA 248.8 214.7 15.9% 1 EBIT 199.8 169.6 17.8% 1 Net interest expense (121.9) (110.4) (10.4)% 1 Tax (17.6) (13.2) (33.7)% 1 NPAT – underlyi
Slide 8: Reconciling underlying result
Reconciling underlying result For personal use only Reported Capital Comp. Significant Underlying 1 2 $ million result distributions assets items result Revenue 490.0 7.1 3.6 - 500.7 EBITDA 238.2 7.1 3.6 - 248.8 NPAT 18.0 7.1 - 31.6 56.7 Operating cash flow 114.1 - - 8.8 122.8 (1) Capital distributi
Slide 9: Significant items
Significant items For personal use only $ million 1H09 Revaluation gain/(loss) - GasNet hedges (8.7) Establishment of Energy Infrastructure Investments after transaction costs (14.4) Settlement of acquisition related liabilities (1.5) Income tax effect (7.0) Total after tax cost (31.6) 1H08 Revaluat
Slide 10: Segment performance
Segment performance For personal use only $ million 1H09 1H08 Change Gas transmission and distribution Queensland 50.7 47.9 6% New South Wales 44.0 31.7 39% Victoria 50.5 35.1 44% South Australia 10.8 11.0 (2)% Western Australia 56.1 55.4 1% Northern Territory 1.9 1.2 60% Gas transmission and distri
Slide 11: Operating cash flow
Operating cash flow For personal use only $ million 1H09 1H08 Change Underlying operating cash flow (OCF) 122.8 109.3 12.3% 1 Distributions (net of DRP) 43.7 19.4 Available OCF 79.1 89.9 Underlying OCF per security (cents) 25.8 25.0 3.3% Distribution per security (cents) 15.0 14.5 3.4% Distribution
Slide 12: Major capital expenditure
Major capital expenditure For personal use only $ million 1H09 1H08 Regulated Victoria Transmission System 8.0 42.1 Includes Brooklyn Lara Pipeline APA Gas Networks (Qld) 7.0 7.7 Includes southern network expansion (1H09) 15.0 49.8 Major Projects Queensland expansion 9.9 0.2 Davenport Downs New Sout
Slide 13: Continued distribution growth
Continued distribution growth For personal use only 1H09 payout ratio 60% (on underlying OCF) 1H09 21.3% tax deferred component DRP continues at 2.5% discount On target to meet 5% growth guidance for 2009 full year distribution 1H09 Results Presentation Æ 12
Slide 14: Capital management: Strong balance sheet
Capital management For personal use only Strong balance sheet Cash and committed undrawn facilities of $710 million Improved gearing* of 69.7% - reduced from 72.0% at 30 June 2008 – Continue to target gearing in the range of 65-70% Equity raising totalled $57 million – Security Purchase Plan (
Slide 15: Capital management: Secure long term debt portfolio
Capital management For personal use only Secure long term debt portfolio Refinanced $150 million MTNs in August 2008 (plus additional $15 million debt facility) – Sub 100 bp average margin Refinancing requirement in 2009 to be repaid – March 2009 – MTN $300 million Interest rates – 80% fixed –
Slide 16: Outlook
For personal use only Outlook Mick McCormack Managing Director and CEO
Slide 17: Quality gas infrastructure portfolio
Quality gas infrastructure portfolio For personal use only Delivering gas from all major gas production sources to all major gas markets – More than 50% of gas used in Australia is transported through APA’s pipelines Importance of APA infrastructure in the eastern states – Transporting more than
Slide 18: Responding to uncertain times
Responding to uncertain times For personal use only Global financial crisis – Inelastic gas demand – Quality businesses and assets consuming gas – Increasing borrowing costs ÆContinue to diversify earnings portfolio and actively monitor risk exposures Regulatory environment ─ WACC decision doesn
Slide 19: Guidance and priorities
Guidance and priorities For personal use only Guidance Underlying EBITDA guidance – $420-430 million for FY2009 – While APA will no longer earn EBITDA from the EII assets (other than through its 19.9% interest), APA will benefit from asset management fees and lower interest costs. Distribution g
Slide 20: Supplementary information
For personal use only Supplementary information
Slide 21: Key financial ratios
Financials For personal use only Key financial ratios $ million 1H09 1H08 Comments Underlying operating cash flow (cps) 25.8 25.0 Weighted average securities on issue (m) 475.8 437.4 Payout ratio 59.8% 60.8% EPS (cps) underlying 11.9 10.2 including significant items 3.8 8.2 Interest cover ratio (tim
Slide 22: Revenue analysis by business segment
Financials For personal use only Revenue analysis by business segment $ million 1H09 1H08 Change Revenue Gas transmission and distribution Queensland 70.5 67.4 5% New South Wales 54.4 42.5 28% Victoria 66.0 47.5 39% South Australia 11.3 11.1 2% Western Australia 74.3 71.1 4% Northern Territory 11.1
Slide 23: Total committed debt facilities
Financials For personal use only Total committed debt facilities Facility Facility amount Tenor Medium term notes $300 million March 2009 1 Bilateral borrowings $165 million July 2011 2003 US private placement $496 million 7, 10, 12 and 15 year tranches September 2010, 2013, 2015 and 2018 2 2007 Syn
Slide 24: APA Group business segments
APA Group business segments For personal use only Gas Transmission and Electricity APA Asset Complementary Distribution Transmission Management Energy Assets Queensland: Interstate connectors: Envestra assets: Gas fired generation (Qld): - Roma Brisbane Pipeline - Murraylink (SA-Vic) - 19,100 km gas
Slide 25: Regulatory update
Regulatory update For personal use only Regulatory resets over the next five years The Carpentaria Gas Pipeline and Moomba Sydney Pipeline are now both Light Regulation pipelines. Murraylink and Directlink assets were sold to EII. The current regulatory revenue arrangements for these electricity
Slide 26: For personal use only
For personal use only 1H09 Results Presentation Æ 25
Slide 27: Disclaimer
Disclaimer For personal use only The information contained in this presentation is given without any liability whatsoever to Australian Pipeline Trust or APT Investment Trust or any of its related entities (collectively “APA Group”) or their respective directors or officers, and is not intended to c