Centrica plc · LSE:CNA
Centrica — Merrill Lynch European Power & Gas Leaders' Conference 2003
8 slides from Centrica's conference presentation, Jun 12, 2003
Slide 1: Creating Superior Shareholder Returns
Creating Superior Shareholder Returns Phil Bentley Group Finance Director Merrill Lynch European Power & Gas Leaders’ Conference 12th June 2003
Slide 2: How do we create value? (I)
How do we create value? (I) Centrica’s vision is to be a leading supplier of energy & essential services in our chosen markets. We aim to enhance the Centrica performance versus FTSE 100 since demerger service we provide to 250 our customers and the 200 value we create for our 150 100 % shareholders
Slide 3: How do we create value? (II): Key Drivers
How do we create value? (II): Key Drivers • Brand strength … underpinned by data leverage • Channel breadth • Strategic acquisitions • Commodity management
Slide 4: Brand strength: example - AA
Brand strength: example - AA Value drivers • Strategic brand positioning • Scale - 13 million members • Leader in roadside breakdown • Premium brand • Cost efficiencies service (J.D. Power) • Cross-selling/distribution • Advantaged technology • 50% conversion rate for home insurance AA EBIT • 80% re
Slide 5: Channel breadth: example - British Gas
Channel breadth: example - British Gas Value drivers • 300m customer contacts p.a. • Scale: 25 million customer relationships • 10,500 sales/call centre staff • Premium brand • Cost efficiencies • Over 6,000 engineers • Cross selling/distribution • Advantaged cost of sales • UK’s No. 1 residential g
Slide 6: Strategic Acquisitions: example - North America
Strategic Acquisitions: example - North America Ontario Value Drivers • Operating efficiencies • 26% / 15% residential gas / electricity • Improved customer service • Bundled products • 50% home services • Risk management Texas • Innovative refinancing • 3rd largest electricity retailer • Maximum lo
Slide 7: Commodity management
Commodity management: Value Drivers • Provides advantaged cost of • Commodity procurement expertise goods to support downstream • Commodity risk management • Provide c.25% of energy • Optionality and short term optimisation requirements from own • Market knowledge & trading skills resources Accord T
Slide 8: Targets for value creation
Targets for value creation • Management bonused on annual economic profit improvement • Improving ROIC / operating margins • Constraints on capex / acquisitions to preserve single A rating • Growth in free cash flow and dividends • Top quartile TSR
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