Keyera Corp. · TSX:KEY
Keyera — Investor Presentation (August 2023)
23 slides from Keyera's investor presentation, August 2023
Slide 1: Investor Presentation August 2023
Investor Presentation August 2023 1
Slide 2: Forward-Looking Information & Non-GAAP and Other Financial Measures
Forward-Looking Information & Non-GAAP and Other Financial Measures To provide readers with information regarding Keyera, including its assessment of future plans, operations and All forward-looking information contained herein are expressly qualified by this cautionary statement. Readers are financ
Slide 3: Why Invest In Keyera?
Why Invest In Keyera? Compelling Risk-Adjusted Returns Financial Dividend High-Quality Value Creation ESG Focused Strength Sustainability Assets Track Record Emissions on intensity Low leverage of and absolute basis 2.6x1 net High barrier-to-entry Clearly defined Dividend sustainability assets with
Slide 4: Our ESG Journey
Our ESG Journey 2022-2023 2021 New Board Governance & GHG Targets Sustainability Committee 2020 Parallel Path for ESG-Aligned Materiality Energy Transition Community Assessment; Investment ESG Priorities Enterprise Risk Program 2019 Management ESG-Aligned and Capital Stakeholder Investment Engagemen
Slide 5: Demonstrating ESG Leadership
Demonstrating ESG Leadership Long-Term Value Creation is Consistent with Strong ESG Performance BBB A* 41st 8th * D B* 31st 48th * (2018) (2022) (2018) (2022) (2018) (2022) (2018) (2022) *Rating: Lower is better *Percentile: Lower is better *Rating: Lower is better *Score: Higher is better Keyera ca
Slide 6: Sustained Dividend Growth Through Capital Discipline
Sustained Dividend Growth Through Capital Discipline Target Payout Range 50%-70% of Distributable Cash Flow3 7% Financial Commodity COVID-19 Crisis Price Collapse Pandemic DCF/sh CAGR1,3 (since ’08) DCF/sh3 DCF/sh3 Portion of DCF/sh3 paid as Dividends $2.95 6% Net debt to adjusted EBITDA2,3 Dividend
Slide 7: Our Financial Framework
Our Financial Framework Guiding Our Efforts to Generate Superior Risk-Adjusted Returns Target 2022A Credit ratings BBB BBB/BBB- Preserve Financial Strength and Flexibility Net debt / Adjusted EBITDA1,2 2.5x - 3.0x 2.5x Corporate ROIC1 >12% 16% Invest for Margin Growth and Cash Flow Stability Fee-for
Slide 8: Capital Allocation Priorities
Capital Allocation Priorities Strong Focus on Long-Term Total Shareholder Returns Non-Discretionary 1 Fund maintenance capital Year Priorities 2 Maintain balance sheet strength 2022 Fund major strategic growth project (KAPS) 3 Pay current dividend Balance priorities between: • Bringing net debt to a
Slide 9: Clear Pathway to Near-Term EBITDA Growth
Clear Pathway to Near-Term EBITDA1 Growth Our ’22 – ’25 Plan 2022 2023E 2023 2024E 2024 2025E Continued ramp up at Wapiti Filling of Existing Capacity Adj. EBITDA1 ($M) South Cheecham Sulphur Terminal Storage Cavern 18 Pipestone Capacity Expansion (~40 MMcf/d) Assumes Marketing realized margin1 of K
Slide 10: Strong Financial Position
Strong Financial Position Long-term debt maturities (C$ MM)3 (excludes drawings under revolver) • 2.6x net debt to adjusted EBITDA1,2 at the end of Q2/23 • Conservative payout ratio1 Private Notes • 65% for 2022 (target of 50 - 70%) • Investment grade credit ratings $400 • DBRS Limited: Affirmed, BB
Slide 11: Managing Cash Flow Stability
Managing Cash Flow Stability Realized Margin1 from Investment Grade Customers and Take-or-Pay Contracts MANAGED THROUGH Non ~29% Investment Grade ~34% Non Fee-for-Service RISK MANAGEMENT PROGRAM PROTECTING ~66% Fee-for-Service DOWNSIDE Investment Grade ~71% (78% including secured PRESERVING counterp
Slide 12: Our Integrated Value Chain
Our Integrated Value Chain High Barrier-to-Entry Asset Base with Access to High Value Markets Raw Gas NGL Spec Products External Markets Customers Gathering & Processing Liquids Infrastructure Marketing End Users • Strategically located gas • Highly utilized • Utilizes Keyera’s plants in the liquids
Slide 13: Delivering Energy Infrastructure Solutions
Delivering Energy Infrastructure Solutions Focused on Maximizing Customer Netbacks Energy Infrastructure + Marketing Demand Drivers LNG Canada Natural Gas (C1) LOW-EMISSIONS ENERGY SOURCE ENERGY SECURITY MEDICAL GRADE PLASTIC, Ethane (C2) STERILE PACKAGING Propane (C3) LIGHT WEIGHTING AUTOMOTIVE, FO
Slide 14: A Game Changer for Keyera
A Game Changer for Keyera KAPS Ending Decades Long Monopoly Gordondale Zone 4 Significantly Improves Our Competitiveness Pipestone Fully Integrates our value chain Grand Prairie North G&P Allows to better compete for Wapiti volumes and earn full-value chain returns KAPS Simonette Offer customers a m
Slide 15: Timely Acquisition in the Core Fort Saskatchewan Facilities
Timely Acquisition in the Core Fort Saskatchewan Facilities Adding Meaningful Capacity at the Heart of the Value Chain Keyera Fort Saskatchewan (KFS) Keyera Fort Saskatchewan +14,000 bbls/day Fractionation +6,000 bbls/day De-Ethanization +3.7 million bbls of NGL Storage +79.2k bbls/day Pipeline Capa
Slide 16: Adding High Demand Capacity at Attractive Valuation
Adding High Demand Capacity at Attractive Valuation Transaction Highlights More than 25% incremental capacity added to fractionation, de-ethanization, Expands Core of underground NGL storage and the Fort Saskatchewan Pipeline System (FSPL). Value Chain: Added meaningful fee-for-service cash flows. M
Slide 17: Growth Across Our Integrated Value Chain
Growth Across Our Integrated Value Chain Projects Paced to be Internally Funded C2 Ethane C3 Propane C4 Butane C5+ Condensate iC8 Iso-Octane Gas Plants Keyera Fort Saskatchewan Alberta EnviroFuels Condensate System KAPS and Keylink Spec NGL Transportation Spec NGL Transportation Oil Sands Diluent Su
Slide 18: Playing A Role In The Energy Transition
Playing A Role In The Energy Transition Transitioning to A Low-Carbon Economy Carbon Capture & Storage Clean Fuels • Acid gas injection at six of our • Exploring opportunities to help existing locations1 refiners meet CFS requirements • Potential to provide CCS services using iso-octane for customer
Slide 19: Building A Strong Energy Transition Business
Building A Strong Energy Transition Business Unique Ability to Evolve Existing Asset Base through Energy Transition Potential Shell Keyera H2 Caverns IPL Potential Keyera Fort Saskatchewan (KFS) H2 Cogen and H2 Demand Shell Fort Dow Sask. ATCO IPL Keyera Alberta Crude Terminal (ACT)/ Alberta Diluent
Slide 20: 2023 Guidance
2023 Guidance 2023 Guidance Growth Capital Expenditures: $200-$240 MM Marketing Realized Margin1: $380-$410 MM Maintenance Capital Expenditures: $95-$105 MM Cash Taxes: $Nil Upcoming Planned Turnarounds and Outages Rimbey Gas Plant turnaround 3 weeks Completed in Q2 Keyera Fort Saskatchewan Fraction
Slide 21: Why Invest In Keyera?
Why Invest In Keyera? Compelling Risk-Adjusted Returns Financial Dividend High-Quality Value Creation ESG Focused Strength Sustainability Assets Track Record Emissions on intensity Low leverage of and absolute basis 2.6x1 net High barrier-to-entry Clearly defined Dividend sustainability assets with
Slide 22: Notes
Notes Slide 3 All information as of December 31, 2022, unless otherwise stated. 1. As of June 30, 2023. 2. Distributable cash flow (“DCF”), payout ratio, compound annual growth rate (“CAGR”) for DCF per share, compound annual growth rate (“CAGR”) for dividends per share, adjusted EBITDA and return o
Slide 23: Contact Information
Contact Information Dan Cuthbertson Director, Investor Relations Calvin Locke, P.Eng, MBA Manager, Investor Relations Rahul Pandey, CFA, P.Eng Senior Advisor, Investor Relations Keyera Corp. The Ampersand, West Tower 200 144 – 4th Avenue SW Calgary, Alberta 1-888-699-4853 T2P 3N4 [email protected] www.k