Slide 1: Full year results
For personal use only Full year results 27 August 2008
Slide 2: Disclaimer
Disclaimer For personal use only This publication is prepared by the Transurban Group comprising Transurban Holdings Limited (ACN 098 143 429), Transurban Holdings Trust (ARSN 098 807 419) and Transurban International Limited (ARBN 121 746 825). The responsible entity of Transurban Holdings Trust is
Slide 3: Agenda
Agenda For personal use only • Financials • Investment proposition • CEO review • Conclusion 3
Slide 4: Financials
For personal use only Financials
Slide 5: Key financial highlights
Key financial highlights For personal use only • Revenue growth on existing assets • Full year contribution from Sydney Roads Group • Financial close of Capital Beltway project • CEO review – More robust capital platform – Ongoing cost structure improvements • One-off cost impacts 5
Slide 6: Key financial highlights
1 Key financial highlights For personal use only 30 June 08 30 June 07 % change $M $M Toll and Fee Revenue 665.8 505.6 32% Other Revenue 19.5 20.3 4% Operating Costs (173.8) (132.6) 31% Contribution from Assets 511.5 393.3 30% Net Business Development 10.2 (11.9) 186% Revenue/(Costs) CEU Investment
Slide 7: Key financial highlights
1 Key financial highlights For personal use only 30 June 08 30 June 07 % change $M $M EBITDA 420.8 366.6 15% Depreciation & Amortisation (401.5) (307.8) 30% Net Finance Costs (184.9) (172.7) 7% FX (Loss)/Gain (1.4) 11.3 112% Share of Associates Losses (22.0) (25.5) 14% Tax Benefit/(Expense) 48.5 (24
Slide 8: Key financial highlights – proportional
Key financial highlights – proportional1 For personal use only 30 June 08 30 June 07 % change $M $M Toll and Fee Revenue 766.6 572.6 34% Other Revenue 19.0 18.6 2% Operating Costs (188.0) (144.6) 30% Contribution from Assets 597.6 446.6 34% Net Business Development 5.4 (11.9) 145% Revenue/(Costs) CE
Slide 9: Business Development
Business Development For personal use only 30 June 08 30 June 07 $M $M Profit from Sale of Pocahontas1 25.6 - Success and Management Fees2 42.6 - Incremental Expense associated with Fees (21.3) - Net Project (Write-offs)/Capitalised (12.8) 5.9 BD Australia/US Operating Costs (28.7) (17.8) Net Busine
Slide 10: Cost reduction program
Cost reduction program For personal use only Other ongoing • Target to remove $20 million from ongoing cost initiatives structure Total $21.4m • Progress to date $3.9m Reduced operating costs – Australian workforce costs reduced by 14% Reduced corporate $3.0m costs – Relocation from premium corporat
Slide 11: Cash flow metrics
Cash flow metrics For personal use only 30 June 08 30 June 07 % change $M $M Free Cash from Operations1 316.5 135.9 133% Free Cash per Security2 26.0 cents 12.7 cents 105% • Strong cash flow reflects: – Cash strength of CityLink and M2 – Contribution from SRG assets – FY08 Free Cash per Security ben
Slide 12: Key funding activities
Key funding activities For personal use only • Placement $659 million – A strategic placement of 120 million securities at $5.49 per security, priced at 30 day VWAP, representing a 7% premium to the closing price on 18 June 20081 • Dividend Reinvestment Plan $239 million – Underwritten to 75% • Shar
Slide 13: Transurban's investment proposition
For personal use only Transurban’s investment proposition
Slide 14: The FY08 result — a base for growing returns
The FY08 result For personal use only — a base for growing returns 14
Slide 15: Cash flow
Cash flow For personal use only 30 June 08 $M Free Cash from Operations 316.5 Free Cash per Security 26.0 cents • Strong cash flow generated by existing assets • Foundation for security holder returns • FY08 Free Cash per Security benefited from one-off contributions including release of Westlink M7
Slide 16: Strong free cash flow growth on existing assets
Strong free cash flow growth For personal use only on existing assets
Slide 17: Growing tolls and traffic
Growing tolls and traffic For personal use only FY08 Tolling FY08 & fee revenue TCL ownership Years Asset increase Escalation basis 1 (%) remaining ($m) (%) CityLink 362.8 9.4 100 Max of CPI or 4.5% 25 Hills M2 119.0 11.1 100 Max of CPI or 4.0% 33.5 Westlink M7 150.8 16.4 50 CPI 28.5 M1 73.7 7.6 75.
Slide 18: Historically proven growth
Historically proven growth For personal use only CityLink toll & fee revenue growth 400 350 300 $ million 250 200 150 100 50 0 FY02 FY03 FY04 FY05 FY06 FY07 FY08 18
Slide 19: Earnings resilience
Earnings resilience For personal use only Transurban asset growth vs fuel price 150 4.5m Fuel price (cents per litre) Transaction Volume 100 4.0m 50 3.5m 0 FY04 FY05 FY06 FY07 FY08 1 Fuel Unleaded Petrol Average Annual Price (NSW) [RHS] Australian transaction/trip volume (excl.M7) [LHS] Total Austra
Slide 20: Expanding wedge of free cash
Expanding wedge of free cash For personal use only Baseline revenue growth Aim to increase the wedge Time * Indicative representation only 20
Slide 21: Additional cash flow growth
Additional For personal use only cash flow growth
Slide 22: Monash-CityLink-West Gate upgrade
Monash-CityLink-West Gate upgrade For personal use only • Asset upside unlocked - validates owner-operator model • Upgrade to CityLink corridor commenced in FY08 • Forecast traffic uplift 7% across CityLink within 5 years • Construction due for completion in late 2010 22
Slide 23: Sydney network
Sydney network For personal use only M2 widening – Negotiations with NSW RTA underway M5 widening – Proposal to NSW RTA under development 23
Slide 24: Medium-term growth drivers
Medium-term For personal use only growth drivers
Slide 25: Virginia network, North America
Virginia network, North America For personal use only • Capital Beltway – Ground breaking ceremony held on 22 July 2008 – Construction progress on track • I-95/395 – Under negotiation – Milestones to financial close include: • Environmental review • Permitting process • Financing negotiations – Two
Slide 26: Long-term growth opportunities
Long-term growth For personal use only opportunities 26
Slide 27: Additional growth drivers
Additional growth drivers For personal use only Focus on replenishing North American project pipeline • North American HOT Lane projects – US market has 31 projects in construction or development • Transurban has Capital Beltway in construction and I-95 under negotiation – Capital Beltway project es
Slide 28: CEO review
For personal use only CEO review
Slide 29: New business framework
New business framework For personal use only June 2008 – Strengthened balance sheet – Aligned distribution profile to operating cash – Improved capital structure for Group – Cost reduction program 29
Slide 30: People
People Chief Executive For personal use only Officer Chris Lynch President Chief Acting Chief GGM Company GGM Strategy & GGM Human Executive VP North America Operating Officer Finance Officer Public Affairs Secretary Development Resources Int’l Development Michael Brendan Samantha Megan Elizabeth An
Slide 31: Conclusion
For personal use only Conclusion
Slide 32: Transparent, secure returns
Transparent, secure returns For personal use only • Strong underlying asset base • Substantial improvements to ongoing cost structure • Asset enhancements within Australian asset portfolio • North American negotiated projects and green field opportunities
Slide 33: Appendices
For personal use only Appendices
Slide 34: Result by asset (consolidated) - June 2008
Result by asset (consolidated) - 30 June 2008 Poca Bus Dev/ CityLink Hills M2 Tollaust M1 M4 Roam Total (2 months) Corporate For personal use only Revenue Tolling & fees 362.8 119.0 6.8 73.7 88.5 12.2 2.8 - 665.8 Other 11.5 0.8 0.1 0.3 4.3 1.7 - 0.8 19.5 Total 374.3 119.8 6.9 74.0 92.8 13.9 2.8 0.8
Slide 35: Result by asset (equity investments) June 2008
Result by asset (equity investments) 30 June 2008 For personal use only Poca M5 M7 DRIVe Transtoll Total (10 months) Revenue Tolling & fees 163.6 150.8 12.6 - - 327.0 Other 3.3 - - - - 3.3 Total 166.9 150.8 12.6 - - 330.3 Operating costs Operational (23.4) (34.1) (3.9) - - (61.4) Business Developmen
Slide 36: Result by asset (consolidated) – June 2007
Result by asset (consolidated) – 30 June 2007 M1 M4 Bus Dev/ For personal use only CityLink Hills M2 Tollaust Roam Poca Total (3 months) (3 months) Corporate Revenue Tolling & fees 331.5 107.1 5.6 17.0 16.1 11.9 16.4 - 505.6 CEU Investment Gain - - - - - - - 25.6 25.6 Other 6.1 1.3 0.7 7.0 0.2 2.7 1
Slide 37: Result by asset (equity investments) June 2007
Result by asset (equity investments) 30 June 2007 For personal use only M5 1 M7 Poca DRIVe Transtoll Total (3 months) Revenue Tolling & fees 36.6 129.5 - - - 166.1 Other 0.8 - - - - 0.8 Total 37.4 129.5 - - - 166.9 Operating costs Operational (5.4) (30.8) - - - (36.2) Corporate - - - - - - Total (5.
Slide 38: Reconciliation of cash flow from operations to free cash
Reconciliation of cash flow from operations to free cash For personal use only 2008 2007 $m $m Statutory Cash flow from Operations 353.1 158.1 Less M1 and M4 Cash flow from Operations (113.3) (8.0) Add M1 Dividends received 44.5 - Add M4 Dividends received 12.2 - Add M5 Dividends received 41.5 7.0 L
Slide 39: Reconciliation of statutory P&L to EBITDA June 2008
Reconciliation of statutory P&L to EBITDA 30 June 2008 For personal use only Gross-up Interest and Separately Discontinued Separately Finance Fee FX Loss moved Disclose Net $m Statutory P&L Operations Disclose CEU Total Revenue moved from Corporate Business (incl.Poca Loss to net interest Developmen
Slide 40: Reconciliation of statutory P&L to EBITDA June 2007
Reconciliation of statutory P&L to EBITDA 30 June 2007 For personal use only Gross-up Interest and Separately Discontinued Finance Fee FX Loss moved $m Statutory P&L Disclose CEU Total Operations Revenue moved to from Corporate Gain (incl.Poca Profit) net interest Tolling & fee Revenue 489.2 16.4 -
Slide 41: Reconciliation of statutory EBITDA to proportional EBITDA
Reconciliation of statutory EBITDA to proportional EBITDA For personal use only 2008 2007 $m $m Statutory EBITDA 420.8 366.6 Less M1 EBITDA attributable to Minority Interest (13.2) (4.1) M4 EBITDA attributable to the Minority Interest (33.9) (5.5) Add M5 Proportional EBITDA 71.8 16.0 M7 Proportional
Slide 42: Total Group debt at June 2008
Total Group debt at 30 June 2008 For personal use only AUD(1) USD(2) Nature of debt $m Fixed(3) $m Fixed(3) Corporate 2,884 91% 132 100% Non recourse 1,701 84% 744 100% (Proportional) Total 4,585 89% 876 100% 1. AUD represents debt issued in A$ plus debt that has been issued in USD and has been swap
Slide 43: Corporate debt maturity profile
Corporate debt maturity profile For personal use only 700 600 500 AUDm (or equivalent) 400 300 200 100 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 Financial year Undrawn – AUD Drawn – USD Drawn – AUD *USD debt has been converted into A$ at 0.
Slide 44: Non-recourse debt maturity profile
Non-recourse debt maturity profile For personal use only 1400 1200 1000 A$m (or equivalent) 800 600 400 200 0 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2034 2036 2038 2040 2042 2044 2046 2048 Financial year M1 M2 M4 M5 M7 Pocahontas Beltway 1. US$ debt has been converted into
Slide 45: Group debt facilities
Group debt facilities Transurban Corporate Debt ($m) AUD USD For personal use only Working Capital Lines $0(1) $0 Term Bank Debt $600 $0 US Private Placements $1,234 $132 Domestic unwrapped bonds $450 $0 Domestic wrapped bonds $600 $0 Total $2,884 $132 Non recourse (A$m) Asset Debt Ownership Proport
Slide 46: Key metrics
Key metrics1 For personal use only TFC senior debt rating (S&P/Moody’s/Fitch) A -/A3/A- TFC corporate rating (S&P) BBB+ Weighted average maturity 10 yrs Weighted average cost of AUD debt 6.82% Weighted average cost of USD debt 5.46% Gearing (debt to enterprise value) 44.6%2 Interest cover ratio (sen
Slide 47: Total Group debt at December 2007
Total Group debt at 31 December 2007 For personal use only AUD(1) USD(2) Nature of debt $m Fixed(3) $m Fixed(3) Corporate 3,187 82% 128 100% Non recourse 1,707 84% 304 100% (Proportional) Total 4,894 83% 432 100% 1. AUD represents debt issued in A$ plus debt that has been issued in USD and has been
Slide 48: For personal use only
For personal use only