Infratil Limited · NZX:IFT
Infratil — Merger or Acquisition (June 2023)
42 slides from Infratil's merger presentation, Jun 7, 2023
Slide 1: Infratil Investor Presentation
Infratil Investor Presentation Infratil to take full control of One New Zealand and announces equity raise of NZ$850 million to fund the deal and other growth opportunities 7 June 2023
Slide 2: Disclaimer and Important Notice
Disclaimer Disclaimer and Important Notice This presentation has been prepared by Infratil Limited (NZ company number 597366, NZX:IFT; ASX:IFT) (“Infratil”) to provide information in relation to an offer of new shares in Infratil (“New Shares”) by way of (a) a placement to eligible institutional and
Slide 3: Disclaimer
Disclaimer Not investment advice This presentation does not constitute legal, financial, tax, financial product advice, investment advice or a recommendation by Infratil or its advisers to acquire New Shares, and has been prepared without taking into account the objectives, financial situation or ne
Slide 4: Disclaimer
Disclaimer Past performance Investors should note that past performance, including past share price performance of Infratil and pro forma historical information in this presentation, is given for illustrative purposes only and cannot be relied upon as an indicator of (and provides no guidance as to)
Slide 5: Transaction Overview
Transaction Overview
Slide 6: Transaction Summary
Transaction Summary Investment • High conviction investment approach focused on 'ideas that matter’ - digital, renewables, healthcare and airports approach • Portfolio well positioned to deliver target long-term returns of 11-15% per annum and • Track record of outstanding returns, delivering a 18.6
Slide 7: Strategic Rationale
Strategic Rationale A foundational New Zealand infrastructure asset with a direct bearing on competitiveness and future growth prospects for New Zealand Further • Strategic initiatives undertaken since 2019 have transformed One NZ into a high performing One NZ has been digital services and connectiv
Slide 8: Portfolio Composition
Portfolio Composition Pre-acquisition Post-acquisition 6% Investment 7% 11% 13% Increased investment in One NZ increases Infratil’s increases Infratil’s $10.2bn1 59% 17% $12.0bn2 portfolio weighting to digital and connectivity… 20% exposure to high 65% conviction digital ... providing significant th
Slide 9: Portfolio Outlook
Portfolio Outlook • Our portfolio is performing well, despite global and local economic uncertainty, inflation and interest rate Infratil remains headwinds • Infratil remains well positioned for capital investment at attractive returns to shareholders, while also well positioned continuing to develo
Slide 10: One NZ Update
One NZ Update
Slide 11: One NZ Snapshot
One NZ Snapshot Leading digital Integrated network with a full-service telecommunications offering, a strong market position across mobile and delivering industry leading growth across multiple segments services and One of New Zealand’s largest telecommunications infrastructure owners with over conn
Slide 12: One NZ Journey
One NZ One NZ has transformed since acquisition in 2019 Journey Improved customer experience today Onshoring of key services and Transformation Product enhancements Radical product in-housing of retail stores New Zealand’s Best Mobile Network1 of the business simplification Simplified customer manag
Slide 13: Market Dynamics
Market Dynamics One NZ is the second largest operator in the New Zealand telco The New Zealand market One NZ has a strong position in the New Zealand telco market telco industry has Stable 3 player market structure which is rational but competitive Mobile subscribers1 a competitive, yet Well positio
Slide 14: Further Growth Potential
Further Growth Potential Winning where it Business One simple business matters Network co-leadership Continued product, plan and Awarded best mobile network in transformation • • Post paid connections driving • experience simplification mobile revenue growth New Zealand in 2022 and 2023 • Best ever
Slide 15: One NZ Performance
One NZ Performance Revenue ($m) EBITDA ($m) & EBITDA Margin (%)1 % EBITDA margin 1,954 1,968 1,984 2,020 - 2,060 22% 24% 27%2 ~29%3 One NZ 580 - 620 continues to 7 528 481 437 deliver strong, stable cash flows FY2021 FY2022 FY2023 FY2024F FY2021 FY2022 FY2023 FY2024F and is well Recurring Revenue Pr
Slide 16: Earnings Momentum
Earnings Momentum A number of value drivers will underpin Strong momentum expected to continue into Clear pathway to growth across the One NZ platform over the medium-term FY2024 and beyond Pro forma FY2024F EBITDA bridge ($m) 615 - 655 achieve current ✓ Continued growth in mobile – One NZ has led t
Slide 17: Earnings Guidance and Funding
Earnings Guidance and Funding
Slide 18: Financial Impact
Financial Impact Infratil FY2024 earnings guidance1 FY2024 • FY2024 Proportionate EBITDAF2 guidance range increased to NZ$800-840 million, reflecting an increased contribution from One NZ Proportionate • Key guidance assumptions in relation to One NZ include: - transaction completion to occur shortl
Slide 19: Funding
Funding Settlement funding sources and uses The NZ$1.8bn Sources NZ$m • At settlement, the $1,815 million acquisition (including consideration Underwritten Institutional Placement1 750 transaction costs) will be funded via the $750 million institutional equity raise and $1,065 million of cash and de
Slide 20: Debt Capacity & Facilities
Debt Capacity & Facilities Debt Capacity & Facilities Post-completion Liquidity (NZ$m) 31 March 2023 As at 6 June 2023 As at 6 June 2023 As at • Following completion of the expected $850 million equity raise and One NZ liquidity to (pro forma) acquisition, undrawn debt facilities will Net bank debt
Slide 21: Equity Raising
Equity Raising
Slide 22: Equity Raising Details
Equity Raising Details Equity Raising Offer size and structure • • • Institutional Placement to raise NZ$750 million and Retail Offer to raise NZ$100 million Approximately 92.4 million new shares to be issued (equivalent to ~12.7% of current issued capital) Infratil intends that eligible shareholder
Slide 23: Equity Raising Timetable
Equity Raising Timetable Key Dates Institutional Placement Date Infratil is raising Trading halt and Institutional Placement bookbuild Wednesday, 7 June 2023 NZ$850 million Announcement of results of Institutional Placement and trading halt lifted ASX settlement Thursday, 8 June 2023 Tuesday, 13 Jun
Slide 24: Closing Remarks & Questions
Closing Remarks & Questions Infratil to take full control of One New Zealand and announces equity raise of NZ$850 million to fund the deal and other growth opportunities 7 June 2023
Slide 25: One NZ Supplementary Materials
One NZ Supplementary Materials Appendix A
Slide 26: Unique Network Infrastructure
Unique Network Infrastructure One of New Zealand’s largest fixed infrastructure One NZ network coverage owners, with a significant fibre and cable network One NZ’s • Over 11,000km of cabling connecting consumer and enterprise customers Whangarei integrated • National high capacity backhaul network a
Slide 27: Financial Summary
Financial Summary One NZ One NZ FY2021 FY2022 FY2023 FY2024F2 Consumer & SME 558 561 623 FY2024 EBITDA Enterprise 101 102 108 Mobile 659 663 731 guidance of Consumer & SME - Fixed & ICT 406 384 345 NZ$580 – $620 Enterprise - Fixed & ICT Wholesale & other 226 196 224 197 251 206 million remains Recur
Slide 28: Infratil Supplementary Materials
Infratil Supplementary Materials Appendix B
Slide 29: Portfolio
Portfolio High conviction approach focused on four ‘ideas that matter’ Infratil’s strategy Digital Renewables Healthcare Airports Stake: is focused on Stake: Stake: Stake: 48.1% 51.1% 55.2% 66% four high conviction 99.9%1 37.1% 50.1% investment 95% 50.0% 20.0% themes and 39.9% 40% global diversifica
Slide 30: Target Returns
Target Returns Portfolio well positioned to deliver attractive returns to shareholders Infratil Expected Leverage Management Return to Portfolio well Portfolio Returns Assumptions Costs Shareholders positioned to Core Lower risk 8-10% Per annum Average net debt / total 1% of assets capital 30% at me
Slide 31: Infratil's Performance
Infratil’s Performance Track record of growth1 Outstanding $10.00 $10.10 18.6% total share price shareholder $9.00 return since $8.00 inception2 performance $7.00 4th largest company on the NZX by since inception, $6.00 free float market capitalisation3 growing to now $5.00 $4.00 being one of the $3
Slide 32: Renewables Growth Pipeline
Growth Pipeline Renewables Current investment programmes and future pipeline Vertically integrated North American renewables developer, owner and operator Infratil’s portfolio • Longroad is aiming to deliver ~6GW of projects over calendar years 2023, 2024, 2025 and 2026, requiring ~US$8 billion of c
Slide 33: Digital Growth Pipeline
Growth Pipeline Digital Current investment programmes and future pipeline Largest privately owned and operated data centre business in Australia and New Zealand with 268MW of operating capacity across 13 facilities in four locations Infratil’s portfolio • 42MW of capacity under construction across t
Slide 34: Healthcare and Airport Growth Pipeline
Growth Pipeline Health & Airport Current investment programmes and future pipeline New Zealand’s largest diagnostic imaging group with 74 clinics nationwide Infratil’s portfolio • Three new and refurbished regional facilities recently opened as part of a commitment to support local communities by de
Slide 35: Asset Values
Asset Values Asset Value1 Value of Infratil’s (NZ$ Millions) Stake Asset Value • Asset values of Infratil’s investments in CDC Data Centres, CDC Data Centres 48.1% $3,660m subsidiaries and One NZ 99.9% $3,600m1 Longroad Energy, Galileo, Qscan, RetireAustralia and RHCNZ Medical Imaging reflect Indepe
Slide 36: Key Risks
Key Risks Appendix C -
Slide 37: Key Risks
Key Risks Key risk considerations related to the equity raising This section comments on the risks that Infratil has identified in connection with the equity raise. Like any investment, there are risks associated with an investment in Infratil shares. This section does not (and does not purport to)
Slide 38: Foreign Selling Restrictions
Foreign Selling Restrictions Appendix D
Slide 39: Foreign Selling Restrictions
Foreign Selling Restrictions International Offer Restrictions This document does not constitute an offer of new ordinary shares ("New Shares") of Infratil in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, and the New Shares may not
Slide 40: Foreign Selling Restrictions (cont.)
Foreign Selling Restrictions (cont.) Infratil as well as its directors and officers may be located outside Canada and, as a result, it may not be possible for purchasers to effect service of process within Canada upon Infratil or its directors or officers. All or a substantial portion of the assets
Slide 41: Foreign Selling Restrictions (cont.)
Foreign Selling Restrictions (cont.) Cayman Islands Infratil is not licensed to conduct investment business in the Cayman Islands by the Cayman Islands Monetary Authority and this document does not constitute an offer to members of the public of the New Shares, whether by way of sale or subscription
Slide 42: Foreign Selling Restrictions (cont.)
Foreign Selling Restrictions (cont.) This document has been given to you on the basis that you are (i) an existing holder of securities in Infratil, (ii) an "institutional investor" (as defined in the SFA) or (iii) an "accredited investor" (as defined in the SFA). In the event that you are not an in