Apa Group · ASX:APA
Apa — Investor Presentation (February 2020)
38 slides from Apa's investor presentation, Feb 18, 2020
Slide 1: ASX Announcement: APA Group Investor Pack
Australian Pipeline Ltd ACN 091 344 704 | Australian Pipeline Trust ARSN 091 678 778 | APT Investment Trust ARSN 115 585 441 Level 25, 580 George Street Sydney NSW 2000 | PO Box R41 Royal Exchange NSW 1225 Phone +61 2 9693 0000 | Fax +61 2 9693 0093 APA Group | apa.com.au 18 February 2020 ASX ANNOUN
Slide 2: APA Group investor pack
APA Group investor pack. For personal use only As at 18 February 2020
Slide 3: In this pack you'll find
Thanks for your interest in APA. For personal use only In this pack you’ll find: • Snapshot, Strategy and Value Proposition 4 - 13 • Company Structure 14 - 16 • Financial Metrics 17 - 20 • Gas Market Overview 21 - 24 • Asset Specific Information 25 - 35
Slide 4: APA overview
For personal use only APA overview 3
Slide 5: Snapshot of APA
snapshot of APA …a leading Australian energy infrastructure business For personal use only Assets owned/operated Market capitalisation ~$21 billion $13.4 billion (as at 17 February 2020) $0.6 billion (as at 30 June 2000) Gas transmission(1) 15,425 km transmission pipelines Credit ratings Moody’s: Ba
Slide 6: Our footprint
our footprint Darwin APA assets and investments Integrated Operations Centre For personal use only APA operated assets Gas-fired power station Other natural gas pipelines Gas processing plant Electricity interconnectors Gas storage LNG plant Northern Wind Farm Natural Gas & Territory ethane 2P reser
Slide 7: APA's strategy
APA’s strategy • Deliver services our customers value consistent with our Customer Promise For personal use only • Continue to strengthen asset and stakeholder management, development and operational capabilities • Our growth focus is to enhance our portfolio of: – gas transmission pipelines – power
Slide 8: Asset portfolio development
asset portfolio development 2017-2019 20 years / >$14 billion APA’s largest organic growth capex For personal use only program ~$1.5 billion of energy infrastructure added to of investment into the Australian gas market 2014-2016 APA’s footprint over the 3 Access to LNG export year period market – R
Slide 9: Our value proposition
our value proposition “…owner and operator of energy infrastructure underwritten by long term contracts with highly creditworthy counterparties…” For personal use only Quality & diversified infrastructure Ongoing Low risk organic business growth model 8
Slide 10: Why invest in APA?
why invest in APA? Uniquely integrated energy infrastructure portfolio ~90% For personal use only Interconnected gas transmission pipeline grid / quality infrastructure assets Provide customers with flexibility – multi asset and/or multi service contract options Integrated Operations Centre
Slide 11: Reliable guidance (historical)
reliable guidance (historical) • Stable cash flows For personal use only • Low risk business model • Majority take or pay contracts with CPI adjustments • Revenue weighted average contract tenor as at 1 Jan 2020 remains >12 years • Established customer relationships • Quality and diversified asset p
Slide 12: Capital expenditure
capital expenditure Growth capex: >$400 m pa average over the last 5 years >$300 m pa average over the last 10 years For personal use only 5 year 10 year millions FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 1H FY20 average* average* SIB and IT 12 16 15 18 24 25 45 51 53 69 113 118 74
Slide 13: Continued growth momentum
continued growth momentum Normalised EBITDA Normalised operating cash flow $1,800m $1,200m For personal use only $1,600m $1,574 $1,000m $1,032 $1,518 $1,012 $1,400m $1,470 $974 $1,331 $862 $1,200m $800m $1,000m $600m $800m $545 $822 $747 $400m $433 $440 $600m $662 $400m $200m $200m 1H FY19 1H FY20 1
Slide 14: Distributions and TSR returns
distributions and TSR returns APA’s distributions have increased every year for nearly two decades 17.2% compound annual growth rate pa For personal use only TSR cents 2500 60.0 TSR: 2,140.6%(1) since listing CAGR: 17.2% pa 50.0 2000 27.0* 47.0 45.0 43.5 41.5 40.0 1500 38.0 35.5 36.3 34.4 35.0 32.8
Slide 15: Company structure
For personal use only company structure 14
Slide 16: Group structure
group structure • APA Group is listed as a stapled structure on the Group Structure Australian Securities Exchange (ASX:APA) For personal use only APA Group Securityholders • APA is comprised of two registered managed investment schemes: Australian Pipeline Trust APT Investment Trust Australian Pi
Slide 17: APA's new operating model
APA’s new operating model – as at Feb 2020 Clear accountabilities Empower our people to make the right decisions at the right level For personal use only Invest resources into the business where they are needed Chief Executive Officer and Managing Director Rob Wheals President Group Group Grou
Slide 18: Financial metrics
For personal use only financial metrics 17
Slide 19: Year financials
5 year financials Financial Performance (Statutory) HY2020 FY2019 FY2018 FY2017 FY2016 FY2015 Revenue $m 1,313.8 2,452.2 2,386.7 2,326.4 2,094.3 1,553.6 Revenue excluding pass-through(1) $m 1,077.8 2,031.0 1,941.4 1,888.3 1,656.0 1,119.2 For personal use only EBITDA $m 842.2 1,573.8 1,518.5 1,470.1
Slide 20: Year financials (con't)
5 year financials (con’t) For personal use only EBITDA by Segment (Excluding Significant Items) HY2020 FY2019 FY2018 FY2017 FY2016 FY2015 EBITDA (Continuing businesses) Energy Infrastructure East Coast: Queensland $m 506.3 1,010.1 962.2 925.4 855.8 340.1 New South Wales $m 81.6 149.4 147.1 149.5 121
Slide 21: Capital management
capital management APA’s parameters for capital management and distributions For personal use only Capital Management: • Retain our 2 credit ratings at Baa2/Stable (Moody’s) and BBB/Stable (S&P) to facilitate access to global debt capital markets • Fund growth with an appropriate mix of funds retain
Slide 22: Gas market overview
gas market overview For personal use only 21
Slide 23: Gas demand, supply, price trends
gas demand, supply, price trends Gas supply and demand East coast gas demand & production AEMO 2019 Gas Statement of Opportunities: For personal use only • Gas Supply from existing and committed gas developments is forecast to meet gas demands until 2023 • Risks remain that any weather-driven varian
Slide 24: Regulation of Australian gas pipelines
regulation of Australian gas pipelines • In HY2020, 8.7% of APA’s EBITDA in Energy Infrastructure was For personal use only APA pipelines by regulation type from full regulated assets • Gas pipelines are regulated by the Australian Energy Regulator (AER) or, the Economic Regulation Authority of West
Slide 25: Regulation of Australian gas pipelines (con't)
regulation of Australian gas pipelines (con’t) Schedule of regulatory For personal use only reset dates for APA Access • Apply for a term, generally 5 years arrangement • Set out the terms and conditions of third party access, including • At least one reference service that is commonly sought by cus
Slide 26: Asset specifics
For personal use only asset specifics 25
Slide 27: History - Energy Infrastructure business segment
history - Energy Infrastructure business segment 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Roma Brisbane Pipeline 85%,60 TJ/d 100%, 208 TJ/d 233 TJ/d Bi-directional Carpentaria Gas Pipeline 70%, 90 TJ/d 100%, 102 TJ/d 119 TJ/d Bi-directi
Slide 28: History - Energy Investments and Asset Management segments
history - Energy Investments and Asset Management segments For personal use only 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 SEA Gas Pipeline 33.3% 50% Allgas Gas Distribution Network 100% 20% AGN (Envestra) 17% 30.6% 33% 0%, O&M until 2027 Daandine and X41 Power Stati
Slide 29: Historical normalised EBITDA by asset - Energy Infrastructure
historical normalised EBITDA by asset – Energy Infrastructure $ millions FY15 FY16 FY17 FY18 FY19 1H FY20 East Coast Grid For personal use only Wallumbilla Gladstone Pipeline 35.8 475.2 488.0 515.9 542.4 267.1 South West Queensland Pipeline 188.3 240.3 242.4 244.3 250.0 131.5 Moomba Sydney Pipeline(
Slide 30: Wallumbilla Gladstone Pipeline, QLD
Wallumbilla Gladstone Pipeline, QLD • Delivers gas to Gladstone for LNG Mount export Isa For personal use only • Fully contracted revenue through to 2035, derived Queensland through take-or-pay GTAs with foundation shippers (BG Group & CNOOC) with two 10 year options to Wallumbilla Gladstone Gladsto
Slide 31: East Coast and Central Region
East Coast and Central Region APA’s 7, 600 plus kilometre integrated pipeline grid on the east coast of Revenue by customer industry Australia has the ability to transport gas seamlessly from multiple gas For personal use only Industrial & Others production facilities to gas users across four states
Slide 32: Western Australia
Western Australia APA services a range of customers in Western Australia within Revenue by customer industry the resources, industrial and utility sectors. APA’s assets enable Energy For personal use only Industrial & Others our customers to have a reliable energy source to supply their 2% 13% iron
Slide 33: Power generation - gas and renewables
power generation - gas and renewables Diamantina Power Station in Queensland • APA owns and/or operates a portfolio of gas, wind and solar power generation assets totalling ~909 MW For personal use only • Assets are located in Queensland, South Australia and Western Australia • Our key power generat
Slide 34: Mid stream processing and storage
mid stream processing and storage Orbost Gas Processing Plant • Located approximately 375km east of Melbourne on the Victorian east coast For personal use only • Connects Cooper Energy’s Sole gas field to eastern Australian gas market • Capacity to process up to ~70 TJ/day (commissioning March 2020)
Slide 35: Asset Management business segment
Asset Management business segment • Provides asset management and operational services for most of APA’s energy infrastructure assets, energy investments, as well as to third parties. For personal use only • Generally provided under long-term contracts (e.g. AGN contract until 2027) • Covers assets
Slide 36: Energy investments business segment
Energy investments business segment For personal use only 35
Slide 37: Disclaimer
Disclaimer This presentation has been prepared by Australian Pipeline Limited (ACN 091 344 704) as responsible entity of the Australian Pipeline Trust (ARSN 091 678 778) and APT Investment Trust (ARSN 115 585 441) (APA Group). For personal use only The information in this presentation does not conta
Slide 38: For further information contact
For personal use only For further information contact: Jennifer Blake Head of Investor Relations Tel: +61 455 071 006 E-mail: jennifer.blake@apa.com.au Or visit the APA website at: www.apa.com.au 37