NTD: Replace Picture with annual report picture Corporate Finance John Whelen Senior Vice President, Finance E n b r i dg e Da y 2 0 1 4
Key Messages 44 Billion Growth Capital Program - Foundation for transparent, highly reliable earnings and cash flow growth Disciplined Financial Management - Significant progress on funding and liquidity plan Sponsored Vehicles…
Reliable Business Model A proven model for sustainable value creation Conservative commercial structures - Regulated assets 2.00 - Long term contracts 1.80 - Mitigation of downside risk 1.60 Prudent financial management /per…
Commercially Secured Growth Capital* Program 11 billion of new projects secured since Enbridge Day 2013 Billions Projects in service in 2013 Market Access Pipelines 1 + 4 Line 5 Expansion + 81 33 Spearhead North Expansion Toledo…
Growth Capital Program* Billions 44 Risked 11 unsecured By in service date 2014 10 33 2015 8 Commercially secured 2016 1 2017 14 * Enterprise wide program, includes EEP and ENF 5
Growth Capital Program* - Near Term Profile Close to 18 billion will come into service by the end of 2015 Billions By in service date Projects in Service in 2014 Norealis, Eddystone, Line 6B, Q1 Q2 Blackspring Ridge Q2 3 Mainline…
Project Return Profiles Tilted returns bolster EPS growth post 2018 20% 15% Equivalent full life DCFROEs tilted Project Level Return on Equity flat 10% 5% 0% Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year…
Secured Growth Capital* - By Return Profile 60% of secured capital generates tilted returns Flat Return Profile Tilted Return Profile Full Life Full Life Years to achieve ( billions) Capital DCFROE Capital DCFROE First year ROE full…
Financial Management Available Liquidity Ample liquidity is being retained to provide funding flexibility Billions 20 18 17 Cash 1 billion of 15 incremental standby Unutilized 10 Billion credit added Billions Capacity…
Financial Management Market price risk mitigation Market price exposure continues to be substantially hedged Average Hedged Rate USD 66% 1.05 CAD/USD Floating 1.47% Rate Debt 69% CDOR/LIBOR Term Debt 3.56% Issuance 88%…
Financial Management Financing Activity 2014 YTD Strong progress on 2014 funding plan Billions Funding sources (nominal dollars) Market Enbridge Inc. Common Equity 0.5 Cdn & US Public DRIP 0.2 Preferred Shares 1.4 Cdn Public…
Financial Management Strong Investment Grade Credit Ratings Issuer Unsecured Debt Ratings DBRS S&P Moodys Enbridge Inc. A (Low) A- Baa1 Enbridge Pipelines Inc. A A- N/A Enbridge Gas Distribution Inc. A(mid) A- N/A Enbridge Energy…
Financial Management Funding Plan (2014-2018) Financing requirements remain very manageable Billions Maintenance & Integrity Capital 5.0 Secured Growth Capital 22.9 Risked Growth Capital 9.4 37.3 Cash Flow Net of Dividends (15.4)…
Financial Management Cost of Equity Optimization and Flexibility Alternative sources of equity exceed 1.9 billion of current common equity requirements Alternative Sources Preferred Shares 1.5B Asset Monetization/Sponsored Vehicle…
Cost of Capital Optimization - Drop Down Transactions Drop down strategy gaining momentum ENF EEP MEP Alliance US Alberta Clipper US 12.6% Interest in Transacted assets Southern Lights* (proposed 2/3 Interest) Midcoast Operating, LP…
Cost of Capital Optimization Drop Down Inventory 24 billion in suitable assets available Canada US Liquids Regional Oil Sands Assets: Eastern Access JFA Athabasca Pipeline & Twin Mainline Expansion JFA Waupisoo Pipeline Line 3 JFA…
Cost of Capital Optimization Sponsored Vehicles Positioned to provide low cost funding and enhance value ENF EEP MEP Demonstrated access Funding constraints Successful IPO to capital alleviated 400MM in term debt 4.2B of drop downs…
Adjusted EPS* Industry leading growth extends to 2018 and beyond Tilted Return Projects Natural Gas New Growth Platforms Sponsored Vehicle Drop Downs Liquids Pipelines Liquids Pipelines 44 billion growth capital program…
Maintenance and Integrity Capital* Spending Major integrity program spending has peaked Billions 2 Enbridge Inc. maintenance and integrity spending expected to decline over 40% from peak 0 2011 2012 2013 2014F 2018E…
Cash Flow Growth Free Cash Flow* per Share Free cash flow per share accelerates rapidly Funds from operations (FFO) (excluding working capital changes) - Sponsored vehicles FFO + Sponsored vehicles distributions +/-…
Key Takeaways 44 billion growth capital program of attractive investment projects Disciplined financial management Commercial and financial risk mitigation Significant progress on funding plan Ample liquidity Sponsored vehicles…
NTD: Replace Picture with annual report picture Q&A John Whelen Senior Vice President, Finance E n b r i dg e Da y 2 0 1 4
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