Origin Energy Limited · ASX:ORG
Origin Energy — Shareholder Meeting (October 2017)
26 slides from Origin Energy's shareholder meeting presentation, Oct 18, 2017
Slide 1: 2017 Annual General Meeting
2017 ANNUAL GENERAL MEETING 18 October 2017
Slide 2: Important Notices
Important Notices Forward looking statements This presentation contains forward looking statements, including statements of current intention, statements of opinion, guidance and predictions as to possible future events. Such statements are not statements of fact and there can be no assurance or cer
Slide 3: Chairman's Address
Chairman’s Address Gordon Cairns 18 October 2017
Slide 4: Our focus is on a cleaner, smarter & customer-centric energy future
Our focus is on a cleaner, smarter & customer-centric energy future PRIORITIES REDUCING DEBT AND LEADERSHIP IN LEADERSHIP IN IMPROVING RETURNS ENERGY MARKETS INTEGRATED GAS TRANSFORMING CULTURE
Slide 5: We achieved our best ever safety result
We achieved our best ever safety result Total Recordable Injury Frequency Rate (TRIFR)# 6.5 5.0 4.2 3.8 3.2 FY13 FY14 FY15 FY16 FY17 #TRIFR measures the total number of injuries resulting in lost time per million hours worked
Slide 6: Financial returns are improving
Financial returns are improving Adjusted net debt Reduced debt and improved $m 14,000 performance 12,000 10,000 Underlying Return on Capital 8,000 Employed doubled to 6% 6,000 4,000 2,000 Given focus on reducing debt, no 0 dividend paid in 2017 FY2015 FY2016 FY2017 Contact Origin ex Contact
Slide 7: Drivers behind increasing electricity prices
Drivers behind increasing electricity prices Network Wholesale Retail & other charges prices costs 41% 22% 17% Green energy Retail policies margin 13% 7% Source: ACCC (2007/08 – 2016/17)
Slide 8: Forward prices are falling in response to new supply
Forward prices are falling in response to new supply Electricity spot / forward prices $/MWh 160 140 120 100 80 60 40 NSW QLD SA VIC 20 Investment signal spot prices forward prices needed beyond 0 2020 Jun-16 Jan-17 Aug-17 FY2019 FY2020 High prices driven by coal Increasing renewables withdrawals, h
Slide 9: Drivers behind rising gas prices
Drivers behind rising gas prices • Exhausted low cost supply that delivered historically low prices • Now accessing higher cost resources • Development restrictions limiting industry's ability to increase supply
Slide 10: Action Origin is taking to increase gas supply
Action Origin is taking to increase gas supply Australia Pacific LNG meets ~20 per cent of annual demand for east coast gas has agreed to supply more gas to the domestic market Origin actively signing contracts with gas customers working to bring on more supply for 2018
Slide 11: Responding to climate change
Responding to climate change Support the Paris Climate Accord Support Australia’s emissions reduction target of 26 – 28% decrease on 2005 levels by 2030, at a minimum Support a target of net zero emissions from the electricity sector by 2050, or earlier Analysis of carbon reduction scenarios
Slide 12: Five pillars to progressively decarbonise our business
Five pillars to progressively decarbonise our business Exit coal fuel generation by early 2030s Significantly grow renewables – target 25% of generation mix by 2020, up from 10% today Leverage strong gas position as a firming fuel Empower customers with cleaner, smarter energy solutions Demonstrate
Slide 13: Conclusion
r NN i i AANA NVA
Slide 14: CEO's Address
CEO’s Address Frank Calabria 18 October 2017
Slide 15: Delivering on our commitments
Delivering on our commitments Reduced debt by $1 billion to $8.1 billion Sold Lattice Energy – on track for further debt reduction in FY2018 New leadership team and transitioning our culture Simplified business to focus on strengths in Energy Markets and opportunities in unconventional gas Recapture
Slide 16: 2017 financial highlights
2017 financial highlights Statutory Loss Underlying EBITDA $(2,226) million $2,530 million (126.9) cps Including impairments of $3,064 Up $834 million on FY2016 million after tax NCOIA Underlying Profit $1,378 million $550 million 31.3 cps up $163 million on FY2016 Up $185 million on FY2016
Slide 17: Helping customers
Helping customers No price increase for hardship customers Continuing to write to customers before discounts expire with new offers Writing to customers on lapsed discounts and standing offers Support industry-wide comparator rate so customers can easily compare offers
Slide 18: Increasing supply to maintain security and help reduce prices
Increasing supply to maintain security and help reduce prices Increasing output at Eraring by Committed to 1,200 MW of new 5 – 10% in FY2018 renewables since March 2016 Australia’s largest fleet of peaking Targeting renewables to be 25% of gas-fired power stations providing generation mix by
Slide 19: Increasing gas supply to industrial customers
Increasing gas supply to industrial customers Increased gas sales volumes by 12% in FY2017 Signed 760 domestic customer agreements during FY2017 Actively working to bring on more gas supply for 2018
Slide 20: Progressing future gas development opportunities
Progressing future gas development opportunities Future development options to bring more gas supply to market Targeting FEED on Ironbark during FY2018 Material contingent shale gas discovered in Beetaloo Basin in Northern Territory in FY2017 Increased interest in the Beetaloo Basin to 70%
Slide 21: Australia Pacific LNG targeting significant cost reduction
Australia Pacific LNG targeting significant cost reduction • Two-train lenders test completed • Focus is now on significant cost reduction including: • Advanced analytics • Optimising operations • Well productivity improvements
Slide 22: Technology is transforming energy for customers
Technology is transforming energy for customers COLLABORATING Partnering with 7 other Sponsoring startup energy utilities globally to select and innovation hub in Australia support 12 energy technology startups TECHNOLOGY TRIALS & INVESTMENTS Smart Premises Demand Peer to peer Response trading Deman
Slide 23: FY2018 guidance reaffirmed
FY2018 guidance reaffirmed Energy Markets FY2018 EBITDA is expected to be in the range of $1.7 - $1.8 billion, provided that market conditions and the regulatory environment do not materially change Origin’s share of APLNG production is expected to be 245 - 265 PJ In FY2018, APLNG is expected
Slide 24: Conclusion
Conclusion
Slide 25: 2017 AGM Summary of Proxy Voting as at Proxy Close
2017 AGM Summary of Proxy Voting as at Proxy Close For Against Abstain* Proxy's Discretion Resolution 2. Election of Ms Teresa Engelhard 1,053,577,486 98.53% 5,628,936 0.53% 1,263,257 10,091,174 0.94% 3. Re-election of Ms Maxine Brenner 1,043,610,140 97.59% 15,728,134 1.47% 1,140,795 10,081,784 0.94
Slide 26: 2017 Annual General Meeting
2017 ANNUAL GENERAL MEETING 18 October 2017