NorthWestern Energy Group, Inc. · NASDAQ:NWE
NorthWestern Energy — Non-Deal Roadshow (July 2009)
22 slides from NorthWestern Energy's roadshow presentation, Jul 29, 2009
Slide 1: Investor Update
Investor Update Chicago, Milwaukee & Minneapolis July 29- 29-31, 2009
Slide 2: Forward-looking statement
forward--looking statement… forward During the course of this presentation, there will be forward- forward-looking statements within the meaning of the “safe harbor” provisions of the P i t Securities Private S iti Litigation Liti ti Reform R f Act A t off 1995. 1995 Forward F Forward- d-looking l k
Slide 3: Who we are
who we are… 656,000 656 000 customers » 392,000 electric » 264,000 natural gas Approximately 123,000 square miles of service territory in Montana, Nebraska and South Dakota Total generation (mostly base load coal) » MT – 222 MW – regulated as of 1/1/09 » SD – 312 MW – regulated Total Assets:
Slide 4: NorthWestern's attributes
NorthWestern’s attributes… Solid operations » Cost competitive » Above-average reliability » Award-winning customer service Increasing earnings » Colstrip Unit 4 into rates effective Jan. 1, 2009 ♦ Expected E t d to t add dd $9 million illi or $ $.25/share 25/ h over 2008 earnings i ♦ Estimate i
Slide 5: Regulatory update
regulatory update… Rate case to be filed in Montana in 2009 » Filing will include both electric and natural gas distribution businesses » Expect to file in 3Q 2009 on 2008 test year » Expect decision by July 1, 2010 Mill Creek Generation Station filed with MPSC » MPSC approval in 2Q 2009 » Const
Slide 6: 2009 year to date results
2009 year to date results… Unaudited (Do llars in 000's) Six Months Ended June 30, 2009 2008 Variance Gross Margin increased mainly due to transfer of Operating Revenues 606,616 662,481 (55,865) interest in CU4 into regulated Cost of Sales 314,850 378,438 (63,588) electric and offset by reduced Gro
Slide 7: 2009 income guidance
2009 income guidance… $1.75 to $1.85 per fully diluted share Drivers » Reduced R d d wheeling h li transmission t i i revenues ini Montana M t for f the th remainder of 2009 » 2009 net income will increase by approximately $9 million or $.25 per share as a result of the inclusion of our interest i
Slide 8: Strong balance sheet
strong balance sheet… (Dollars in 000's) June 30, December 31, 2009 2008 Cash 22,963 11,292 Restricted Cash 16,640 14,727 Accounts Receivable, Net 97,962 155,672 Inventories 47,350 70,741 Other Current Assets 75,459 60,985 Goodwill 355,128 355,128 PP&E and Other Non Non-current current Assets 2 104
Slide 9: Liquidity highlights
liquidity highlights… Liquidity position remains strong Debt Maturity Schedule Total liquidity currently in the as of 6/30/09 ($Million's) $270 million range $500 Recently issued $250 million in First Mortgage Bonds $450 » 10 year maturity with interest rate $400 of 6.34% $350 » Primarily used p
Slide 10: Credit ratings
credit ratings… Fitch S&P Moody’s y Senior Secured Rating BBB+ A- (MT) Baa1 BBB+ (SD) Senior Unsecured BBB BBB Baa2 Outlook Stable Stable Positive Fitch upgraded in January 2009 and Moody’s upgraded in March 2009. 2009 10
Slide 11: Generation growth highlights
generation growth highlights… Mill Creek Generating Unit in Montana Existing E i ti regulating l ti services i are becoming more expensive and scarce 150 MW plant near Anaconda, MT » To be built for regulation services to balance supply and load for NWE’s Balancing Area » Rate-based cost of serv
Slide 12: Our proposed transmission projects
our proposed transmission projects… 12
Slide 13: Generation plans shifting to wind
generation plans shifting to wind… Potential Transmission Delivery in Montana 5000 4500 4000 3500 Capacity (MW) 3000 2500 2000 1500 C 1000 500 0 Coal Gas Wind Transmission and Total MT Existing P Power Marketers M k t G Generation ti Feb '08 June '09 New generation in Montana mostly wind and will ne
Slide 14: Supply - Montana wind potential
supply - Montana wind potential… Very strong wind regime in Montana. 14
Slide 15: Demand - renewable standards
demand - renewable standards… The current renewable percentage of NorthWestern’s electric supply in Montana is a little more than 8%. 15
Slide 16: Our transmission developments
our transmission developments… Colstrip 500 kV Upgrade Line already exists – represents an upgrade » Upgrades substation capacity » Increases load capacity of existing line by 500-600 MW’s Needed to relieve congestion g to the West Market interest is increasing for Montana’s high quality wind
Slide 17: Transmission project developments
transmission project developments… 230 kV “Collector System” Provides gathering system for C ll t System Collector S t Example E l new generation to access MSTI and network system North of Great Falls Area benefits Great Falls Belt/Judith Gap Area Our project with no partners Ovando Sub Judith G
Slide 18: Transmission project developments cont'd
transmission project developments cont’d… MSTI Provides additional capacity on a historically constrained path, path and connects expanding new renewable markets in Idaho, Utah and the Southwest U.S. Total project cost estimated from $800 million to $1 billion » Considering strategic partners
Slide 19: Capex spending - next few years
capex spending – next few years… Includes more than $1 billion of potential generation and transmission growth projects. $700 Non-discretionary $600 capex is funded 100% by y free cash flow. $500 $400 MSTI project is now slated for early 2014 and capex has $300 b been modified difi d accordingly. di
Slide 20: Growth project potential
growth project potential… Annual Earnings (in millions) Cost of Project Opportunity * Timing Mill Creek Generation Station $ 200 to $ 200 $ 10.0 10 0 to $ 10.0 10 0 Dec 2010 Colstrip 500 kV transmission upgrade ** $ 50 to $ 75 $ 2.5 to $ 3.8 Jan 2012 South Dakota Peaking generation $ 75 to $ 90 $ 3.
Slide 21: Growth project milestones '09 & '10
growth project milestones ’09 & ’10… Mill Creek Mill Creek 2009 2010 Expect decision from the MPSC (APPROVED) Q2 Complete construction Q4 Begin construction Q3 Start St t up, commissioning i i i and d completion l ti Q4 500 kV upgrade 500 kV upgrade 2009 2010 Complete p engineering g g and
Slide 22: Summary
summary… Value » Dividend yield in excess of 5.4% Strong financial profile » All debt is investment grade rated » 2009 earnings expected to increase over 2008 » Strongg cash flows from increasingg earnings g and NOLs expected p into 2012 Improving regulatory relationships Opportunity for gro