Origin Energy Limited · ASX:ORG
Origin Energy — FY2007 Earnings Presentation
24 slides from Origin Energy's earnings presentation, Aug 29, 2007
Slide 1: Final Results Announcement Full-year ended 30 June 2007
Final Results Announcement Full-year ended 30 June 2007 Media Presentation 29 August 2007 1
Slide 2: Outline
Outline • Performance Highlights • Financial Review • Operating Review • Outlook - All references to $ are references to Australian dollars unless otherwise specifically marked - All comparative data are in relation to the prior corresponding period, 1 July 2005 to 30 June 2006, unless otherwise sta
Slide 3: Disclaimer
Disclaimer Any forward looking information in this presentation has been prepared on the basis of a number of assumptions which may prove to be incorrect and these statements speak only as of the date of this presentation. This presentation should not be relied upon as a recommendation to buy or sel
Slide 4: Performance Highlights
origin energy Performance Highlights )
Slide 5: This year has been a year of transformation for Origin
This year has been a year of transformation for Origin with progress on a number of significant projects and initiatives… • BassGas Project commissioned achieving targeted rates of production • Negotiated early termination of Mt Stuart Power Purchase Agreement, providing Origin with greater flexibil
Slide 6: In a challenging year Origin has delivered a strong result
In a challenging year in wholesale gas and electricity markets… • Revenue $6,456 million up 10% • EBITDAF(1) $1,201 million up 12% • Statutory Profit $457 million up 38% • Underlying Profit $370 million up 10% • EPS – Statutory 54.7 cps up 30% • EPS – Underlying 44.3 cps up 4% • Free cash flow(2) $5
Slide 7: EBITDAF of $1,201m up 12% on strong E&P, Generation and Retail
EBITDAF of $1,201m up 12% on strong Exploration & Production, Generation and Retail performance Divisions ($ million) Jun 07 Jun 06(1) % change Exploration & Production 254 209 22 Generation 99 58 69 Retail 341 292 17 Contact 477 488 (2) Networks 30 29 1 Total 1,201 1,077 12 • E&P: Higher production
Slide 8: A final dividend of 11 cps declared, full year 21 cps fully franked
A final dividend of 11 cps has been declared, bringing the full year dividend to 21 cps fully franked Dividends - cents per share Payment and DRP 25 Franking • Ex-dividend date 3 September 2007 100% 100% 40% 100% 100% 100% 100% • Date of record 10 September 2007 20 • Payable 3 October 2007 11 • DRP
Slide 9: Operating Review
origin energy Operating Review
Slide 10: Exploration & Production: major capital program now delivering record earnings
Exploration & Production: major capital program now delivering record earnings… • EBITDAF of $254m, up 22% 600 600 • EBIT down 58% reflecting write-down in Total Revenue, EBITDAF & Capex ($m) Jun-07 carrying value of Cooper Basin 500 Jun-06 500 • BassGas Project commenced production • Ramp-up of CSG
Slide 11: Origin is adding value to its CSG resources
Origin is adding value to its CSG resources by acquiring new acreage, turning resources into reserves, developing production capacity and signing contracts to monetise reserves • CSG assets are: Bowen Basin (Fairview, Spring Gully) Undulla Nose (Talinga, Orana, Condabri, Argyle, Kenya/East, Laur
Slide 12: Generation: committed to 86% increase in installed capacity
Generation: committed to 86% increase in installed generation capacity in Australia… • EBITDAF of $99m, up 69% from $58m 180 180 178 176 174 172 170 • Termination payment for Mt Stuart Power Total Revenue,EBITDAF & Capex($m) Jun-07 168 166 164 160 162 160 158 Purchase Agreement Jun-06 156 154 152 15
Slide 13: Over 90% of generation capacity from low emission or renewable sources
Over 90% of Origin’s generation capacity and over 99% of electricity generated in Australia and New Zealand comes from low emission or renewable sources Electricity Generated - 2007 (Australian Capacity 870 MW) Electricity Generated - 2007 (Australia and New Zealand) Jet fuel, 3% Hydro, 29% Gas, 97%
Slide 14: Successful integration of Sun Retail and net customer gain
Successful integration of Sun Retail and net customer gain delivers step change in Retail… 4,500 350 • EBITDAF of $341m up 17% 4,000 Jun-07 • Acquisition and integration of Sun Retail, 300 adding over 900,000 customers Jun-06 3,500 • Excluding the Sun Retail acquisition, EBITDAF & Capex ($m) 250 Tot
Slide 15: Churn rates remain high; net gain of 22,000 accounts
Churn rates remain high. Origin acquired over 386,000 new accounts for a net gain of 22,000 gas and electricity accounts in addition to Sun Retail June 2007 Origin Energy Customer Numbers Mass Market Churn: Completed & Pending* (in thousands) 45% VIC Elec Natural Electricity Total 40% Vic Gas Gas NS
Slide 16: Maintaining customer numbers and margins supports long term value
Maintaining and increasing both customer numbers and customer margins supports growth in long term value Gas and Electricity Jun 07 Jun 06 YE customer numbers (’000) 2,704 1,835 Weighted av customer no (‘000) 2,210 EBITDAF / Sales - % 9.2% 9.5% EBITF / Sales % 8.4% 8.7% $ Per Customer: Gross Margin
Slide 17: Contact Energy: maintained contribution
Contact Energy: maintained contribution… • EBITDAF of $477 million, 2% lower 2,500 600 Jun-07 • The main operating factors that Jun-06 contributed were: 500 2,000 A 20% increase in the unit cost of EBITDAF & Capex ($m) natural gas, both for internal use in Total Revenue ($m) 400 Contact Energy’s t
Slide 18: Networks (Discontinued Business): EBITDAF of $30m
Networks (Discontinued Business): EBITDAF of $30m in line with last year • In April 2007, Origin entered into an 250 20.0 agreement to sell its Networks business to Total Revenue, EBITDAF & Capex ($m) APA for $556.5 million Jun-07 18.0 200 Jun-06 16.0 • The Networks business included Origin Energy A
Slide 19: Origin is well prepared for a carbon constrained future
Origin is well prepared for a carbon constrained future… • Australia’s leading green product retailer with a 33% share of the fastest growing segment of the energy market • Reached a milestone of 250,000 green customers signed • Selected for the first Solar Cities project in Adelaide and subsequentl
Slide 20: Outlook
u rgin Outlook
Slide 21: Significant increase in earnings expected from Australian operations
In the coming year we expect significant increase in earnings from our Australian Operations and a consistent contribution from Contact • Sun Retail will provide a full year contribution • Spring Gully and Walloons CSG will continue ramp-up and BassGas will provide a full year of production • Otway
Slide 22: Looking further ahead Origin will benefit from committed projects
Looking further ahead Origin will benefit from a number of projects already committed… • Expansion of Quarantine power station, due on line in December 2008 • Completion of the Kupe Gas Project which is scheduled to commence production by mid 2009 • Completion of the Darling Downs power project and
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Slide 24: For more information
For more information For more information on Origin Energy please contact Angus Guthrie Manager, Investor Relations Email: [email protected] Office: +61-2-8345 5558 Mobile: + 61-4-1786 4255 Alternatively visit our website www.originenergy.com.au and follow the prompts to the Investor