NorthWestern Energy Group, Inc. · NASDAQ:NWE
NorthWestern Energy — Shareholder Meeting (April 2009)
21 slides from NorthWestern Energy's shareholder meeting presentation, Apr 22, 2009
Slide 1: Annual Meeting of Stockholders
Annual Meeting of Stockholders Butte, MT April 22, 2009
Slide 2: Forward-looking statement
forward-looking statement… During the course of this presentation, there will be forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements often address our expected future business and financial
Slide 3: Who we are
who we are… 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: $2,762
Slide 4: NorthWestern's attributes
NorthWestern’s attributes… Increasing earnings » Colstrip Unit 4 into rates effective Jan. 1, 2009 ♦ Expected to add $9 million or $.25/share in earnings over 2008 » Rate case to be filed in Montana on electric and gas distribution business in 3Q ‘09 Strong cash flows » Steady earnings growth an
Slide 5: Earnings of company since '05
earnings of company since ’05… $2.50 CAGR = 5.98% $2.00 $1.50 $1.00 $0.50 $0.00 2005 2006 2007 2008 2009 P 2005 2006 2007 2008 2009 P GAAP earnings per share $ 1.73 $ 1.06 $ 1.45 $ 1.77 $1.85 - $2.00 Earnings Earnings profile profile is is improving. improving. 5
Slide 6: 2009 income guidance
2009 income guidance… $1.85 to $2.00 per fully diluted share Drivers » CU4 increase expected to be approximately $9 million or $.25/share » Pension expense expected to be flat for 2009 compared to 2008 » Retail electric volumes expected to approximate 2008 » Wholesale electric volumes in SD expect
Slide 7: Strong balance sheet
strong balance sheet… Audited (Dollars in 000's) December 31 2008 2007 Cash 11,292 12,773 Restricted Cash 14,727 14,482 Accounts Receivable, Net 155,672 143,482 Inventories 70,741 63,586 Other Current Assets 60,985 44,031 Goodwill 355,128 355,128 PP&E and Other Non-current Assets 2,093,492 1,913,898
Slide 8: Liquidity highlights
liquidity highlights… Liquidity position remains strong Total liquidity currently in the $275 million range Recently issued $250 million in First Mortgage Bonds » 10 year maturity » 6.34% interest rate » Refinanced our Colstrip loan maturing in December 2009 » Fund utility capital expenditures »
Slide 9: Credit ratings
credit ratings… Fitch S&P Moody’s Senior Secured Rating BBB+ A- (MT) Baa1 BBB+ (SD) Senior Unsecured BBB BBB Baa2 Outlook Stable Stable Positive Debt Debt to to total total capital capital ratio ratio is is 53%. 53%. Plan Plan to to maintain maintain aa 50%-55% 50%-55% debt debt to to total total ca
Slide 10: Growth project potential
growth project potential… Annual Earnings (in millions) Cost of Project Opportunity * Timing Mill Creek Generation Station $ 200 to $ 200 $ 10.0 to $ 10.0 Jan 2011 Colstrip 500 kV transmission upgrade ** $ 50 to $ 60 $ 2.5 to $ 3.0 Jan 2012 South Dakota Peaking generation $ 75 to $ 90 $ 3.8 to $ 4.5
Slide 11: Generation growth highlights
generation growth highlights… Mill Creek Generating Unit in Montana 120-150 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 service investment » Estimated to cost approximately $200 million Public hearing h
Slide 12: Mill Creek timeline
Mill Creek timeline… The The Mill Mill Creek Creek Generation Generation Station Station has has been been filed filed for for pre-approval, pre-approval, with with the MPSC w/decision expected in 2Q ’09. the MPSC w/decision expected in 2Q ’09. 12
Slide 13: Our proposed transmission projects
our proposed transmission projects… 13
Slide 14: Generation plans shifting to wind
generation plans shifting to wind… Potential Transmission Delivery in Montana 6000 5000 Capacity (MW 4000 3000 2000 1000 0 Coal Gas Wind Transmission and Total MT Existing Power Marketers Generation Feb 08 Jan 09 New New generation generation in in Montana Montana is is mostly mostly wind wind and a
Slide 15: Supply – Montana wind potential
supply – Montana wind potential… Very Very strong strong wind wind regime regime in in Montana. Montana. 15
Slide 16: Demand – renewable standards
demand – renewable standards… The The current current renewable renewable percentage percentage of of NorthWestern’s NorthWestern’s electric electric supply supply in in Montana Montana is is aa little little more more than than 8%. 8%. 16
Slide 17: 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 NorthWestern announced joint development agreement with others » Portland General » Puget Sound Energy » Pa
Slide 18: Transmission project developments: Collector System
transmission project developments… 230 kV “Collector System” Our project with no partners Informational meeting with customers in Spring 2009 Open Season early ‘09 to determine configuration Provides gathering system for new generation to access MSTI and network system benefits Cost estima
Slide 19: Transmission project developments: MSTI
transmission project developments, cont’d… MSTI Total project cost estimated from $800 million to $1 billion Considering strategic partners Plan to be operational in 2014 » FERC filing in January ’09 » Information meeting with FERC in March ‘09 » Open Season anticipated in summer ‘09 » Draft E
Slide 20: Cap ex spending – next few years
cap ex spending – next few years… Includes more than $1 billion of potential generation and transmission growth projects. $700 Non-discretionary Non-discretionary $600 capex capex is is funded funded 100% 100% by by free free cash cash flow. flow. $500 $400 MSTI MSTI project project is is now now sl
Slide 21: Summary
summary… Value » Dividend yield in excess of 6.0% » Currently trading at approximately book value » Improved regulatory relationships Opportunity for growth » January 1, 2009 rate basing of our 222 MW interest in CU4 » Montana T&D rate case to be filed in 2009 ♦ Expecting a rate increase request