RESOURCES Group, Inc AGA Financial Forum May 2015 . David L. Goodin President & Chief Executive Officer 1
Diversified Natural Resources Company Building a Strong America 3
Our Vision With integrity, create superior shareholder value by expanding upon our expertise to be the supplier of choice in all of our markets while being a safe and great place to work. Building a Strong America 4
Looking Ahead Growth Opportunities Utility projecting 11% rate base growth compounded annually 2015 - 2019 Record 1.8 billion capital program in place to facilitate growth Pipeline to pursue additional pipeline, refinery and midstream…
Electric & Natural Gas Distribution Electric & Natural Gas Utilities Building a Strong America WA MT ND MN ID OR SD WY Operating in 8 states 1,036,000 electric and natural gas customers in 447 communities 2% customer…
Rate Base & Earnings Growth More than tripled rate base and Projecting 11% CAGR in earnings since 2006 rate base next 5 years 1,600 80 2,800 1,400 2,400 1,200 60 2,000 1,000 1,600 800 40 1,200 600 400 20 800 200 400 0 0 0…
Thunder Spirit Wind Acquisition Signed agreement to purchase 43 wind turbines, 107.5 MW of electric Electric & Natural Gas Distribution generation Building a Strong America To be located near Hettinger in southwestern North…
BSSE Project Proposed Midcontinent-ISO multi-value 345-kV transmission line Electric & Natural Gas Distribution Building a Strong America 160 miles from Big Stone City, SD to Ellendale, ND Projected cost 170 million for companys…
Big Stone Station Environmental Upgrade Required retrofit installation Electric & Natural Gas Distribution Building a Strong America Projected cost 90 million for companys share Environmental cost recovery rider approved in ND and…
Supportive Regulatory Environments Completed Cases Recovery in ND of Big Stone AQCS project through environmental tracker effective July 2014; 8.6 million annually Transmission tracker in ND covering MISO transmission costs, currently…
Supportive Regulatory Environments (cont.) Pending Cases WY natural gas rate increase request of 788,000 annually; agreement reached with consumer advocacy group for increase of 501,000 annually; hearing scheduled May 19 Advance…
Outlook Record capital program - plan to invest approximately 1.8 billion during Electric & Natural Gas Distribution Building a Strong America next 5 years Expect to grow rate base by approximately 1.0 billion, 11% compounded…
Pipeline & Energy Services Regulated operations Building a Strong America 3,800 miles of pipeline Over 1 Bcf/d system capacity 13 interconnecting points 3 storage fields with 193 Bcf working storage capacity Non-regulated…
Dakota Prairie Refinery Commissioned plant in early May Full-year EBITDA projection of Began construction March 2013 60 million to 80 million split 50/50 Building a Strong America 20,000 barrels/day Bakken crude Total cost…
Second Diesel Refinery Under Evaluation To be located in the substantially Barrels Per Day under-supplied Bakken region of 70 North Dakota ND diesel consumption estimated at 60 North 71,000 BPD; capacity to refine Dakota…
Wind Ridge Pipeline Project Initially designed to provide natural gas to CHS-announced fertilizer plant near Spiritwood, ND North Dakota Potential to expand pipe size and add compression to serve eastern ND Approx. 96 miles of…
Demicks Lake Approx. 22 miles of 24 pipe from Demicks Lake processing North Dakota plant to Northern Border Measurement facilities at new Northern Border interconnect Demicks Lake Plant Site Projected cost 50 million - 60…
Growth in Invested Capital 17% CAGR projected for invested capital over 5-year forecast Building a Strong America Record 5-year 2015-2019 capital program of 1.1 billion (Cap ex) 1,200 Pipeline & Energy Services 1,000…
Outlook Record capital program - plan to invest approximately 1.1 billion during next 5 years Pursue additional pipeline, refinery and midstream opportunities Link Bakken production to Midcontinent markets Natural gas service to…
Construction Materials & Services Building a Strong America Materials & Services21
Building Momentum 140 Construction Combined Earnings 121 120 114* 103 100 Margin expansion 80 11% earnings growth 80 73 71 on 5% revenue growth for 2014 60 48 48 compared to 2013 40 20 0 (Millions) 2007 2008 2009 2010 2011…
Operational Capabilities Construction Materials Building a Strong America Top 10 U.S. producer, 5th largest sand and gravel producer Increasingly valuable aggregate reserves totaling 1.1 billion tons in strategic locations Record…
South Region TXDOT letting budget for 2015 and 2016 is 7 billion TX Prop 1 in Texas provides additional 1.7 billion to State Highway Fund in 2015 Gov. Abbott and Legislature seeking 5 billion more in sustainable funding for highway…
North Central Region ND MN SD ND approves 1.1 billion surge bill to fund infrastructure improvements IA NE Iowa passed 10-cent gas tax increase Landed 26 million worth of work in Iowa Picked up 10 million paving job in…
Pacific Region AK CA Increasing cement storage/efficiencies in Alaska 5.3 billion light rail system under construction through 2018 in Hawaii Hawaiian ready-mix market looking up as residential HI construction grows Northern…
Intermountain Region MT 36 million project at Mountain Home AFB in Idaho ID 28 million I-84 Interchange in Boise WY 12 million project at FE Warren AFB in Wyoming Montana housing recovery just landed 3 subdivision jobs in Billings…
Northwest Region WA Railroad work growing precast, construction, aggregates Producing bridge girders for Union Pacific OR Private market improving Subdivisions and tech industry in Central Oregon 5 billion LNG project in Coos Bay…
Operational Capabilities Construction Services Building a Strong America Ranked No. 10 on The Top 600 Specialty Contractors List 2014 second consecutive year of record earnings Highly skilled workforce Inside Electrical…
Building a Strong America Outside Project Success Prairie ClickWind Transmission to edit Master text styles Wichita, KS to Woodward, OK Second level 108-miles of double circuit 345kV Third transmission linelevel Fourth level…
Building a Strong America Inside Project Success Mission critical Click to edit Master text styles Current: Northwest, Las Vegas & Second level Midwest ThirdEast Opportunities: level coast Fourth level Solar & renewables Fifth…
Building a Strong America Industrial Project Success Petrochemical Click to editrefinery Master text styles industry Second level Water purification Third level Power generation & distribution Fourth level…
Building a Strong America Equipment & Supply Success Wagner-Smith Equipment Click to edit Master text styles Complete Second Burleson levelnew facility Capitalize on Phoenix expansion Third level Expand WSE into Colorado Fourth…
Successful Bidding Click to edit Master text styles Second level Third level Fourth level Fifth level Building a Strong America Services Services 34
Opportunities for Backlog Additions Finalist on a substantial transmission project to be awarded soon Click Electrical to edit Master and mechanical text styles Verbally awarded a sizeable institutional project another Pursuing…
Growing Demand Strength in energy markets - Growing demand and infrastructure catch up - Greenfielding equipment and supply locations - Services expertise in transmission and distribution, substation construction, industrial…
Outlook 985 million combined work backlog as of March 31 Additional backlog has been secured since March 31 Future bidding environment appears strong Revenue guidance of 1.7 billion to 1.9 billion for construction materials and 1.1…
Exploration & Production Building a Strong America 2014 Statistics: Production 25 MBOEPD 55% Oil, 7% NGLs, 38% Natural Gas Proved reserves 92 MMBOE (48% Oil) at Dec. 31 342% Reserve Replacement Ratio; 307% Oil RRR 82 million…
Marketing Fidelity Exploration & Production Company Continue to see attractive investment opportunities; however capital required to grow the business would compromise ability to fund the substantial opportunities at other lines of…
Production Mix Rebalance 2008 2014 Gas Gas 38% 80% Oil 16% NGL 7% Oil 55% NGL 4% Rebalanced portfolio toward higher returns for oil Building a Strong America 40
Primary Oil Plays Bakken 48,700 net acres in Mountrail and Stark Counties, ND Development areas have 60 Three Forks locations and 40 Bakken potential locations First quarter 2015 net oil production of 5,600 BOPD 1 to 2 rigs deployed…
Gas Properties Significant operated fields (all 100% WI) Baker Field, Fallon County, MT Bowdoin Field, Phillips County, MT Shiloh Field, Rusk County, TX 2014 net production of 57 MMCF/d Low cost/high margin production at Baker and…
Outlook Plans to market and sell Fidelity Exploration and Production Company Allow funding of substantial opportunities at other lines of business including organic projects and acquisitions Pursue growth with a lower overall…
RESOURCES Group, Inc AGA Financial Forum May 2014 . Doran N. Schwartz Vice President & Chief Financial Officer 44
Record Capital Program Construction 3.9 B Pipeline Utility Increase Cap Ex 1.9 B 105% over next 5 years 2010-2014 2015-2019 Note: Excludes E&P capital expenditures. Building a Strong America 46
Strong Financial Position 2014 Building a Strong America RESOURCES 61% Equity / 39% Debt 6,000 5,000 4,000 Debt/Equity (Millions) 3,000 2,000 1,000 0 12/31/2010 12/31/2011 12/31/2012 12/31/2013 12/31/2014…
Credit & Liquidity At March 31, 2015 (Millions) Capacity Outstanding Available Commercial Paper Programs 825 377 448 40% Revolving Credit Agreements 165 20 140 * Construction Total Exploration 990 397 588 24% & Production…
Dividend Growth Yield of 3.3% 0.73 77 consecutive years of quarterly dividend payments Dividend increased 0.51 November 2014, marking 24 consecutive years of increases Mergent Dividend Achiever since 2000 2005 2006 2007…
Funding Plan for 2015 Based on current estimates, the companys plan to fund gross capital expenditures of 755 million and dividends includes the following sources: Funding Sources Estimates Operating cash flows 600M - 650M Debt 150M…
2015 Earnings per Share Guidance GAAP Basis* (0.65) to (0.80) Exploration & Production** (1.70) to (2.00) Adjusted Basis EPS 1.05 to 1.20 * Excludes future potential ceiling test impairments ** Includes first quarter ceiling test…
Outlook Positioned for long-term growth Building a Strong America Utility record approx. 1.8 billion 5-year capital program driven by customer and load growth RESOURCES Expect to grow rate base by 1.0 billion, 11% compounded…
RESOURCES Group, Inc . Building a Strong America 53
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