AltaGas Income Trust Q1 2006 Investor Presentation May 2006
Forward-looking information Certain information presented today may constitute forward-looking statements. Such statements reflect the Trusts current expectations, estimates, projections and assumptions. These forward-looking…
Business Overview 3
Strategy Optimize assets and maintain high reliability Organic growth through expansion and extension of current assets and services Pursue value-added acquisitions that add to net income, cash flow and return on equity…
Making connections along the energy value chain Field Gathering and Processing Extraction and Transmission Power Generation Energy Services 5
Diversified integrated energy business Net Book Value Operating Income At December 31, 2005 At March 31, 2006 2% Field Gathering and Processing 27% 18% Extraction and Transmission 49% 72 Power Generation 22% 13% 58%…
AltaGas and the WCSB Legend FG&P facility Extraction plant Transmission pipeline Source: Ziff Energy 7
Field Gathering and Processing 73 facilities with 1.0 Bcf/d of capacity, including sour gas capacity Moveable facilities 6,000 km of gathering lines Ability to rapidly tie in new wells Interconnected processing facilities…
AltaGas regional utilization Q1-06 W5 W4 W3 British Columbia Alberta Saskatchewan Average utilization: 28% 57% 47% 68% 55% 63% % Utilization W6 Capacity Throughput 9
Extraction and Transmission 539 Mmcf/d extraction inlet capacity, including Albertas newest extraction plant 2005 average production 13,155 Bbls/d ethane and 6,202 Bbls/d NGLs 6 transmission pipelines totalling 750 km 2005…
Power Generation Supplies 6% of Albertas electricity demand Rights to 353 MW of coal- fired generation until 2020 25 MW of gas-fired peaking capacity Sells power and ancillary services in Alberta Risk mitigation through…
Energy Services Energy procurement and consulting services, natural gas transportation and storage optimization to end-use customers 1,243 energy management contracts in 2005 95% contract renewal rate 312,272 GJ/d average…
Financial Overview 13
Net income Net income ( millions) 2006 28.6 million, or 4% increase 100 90.3 over 2005 90 80 Higher power prices received 70 65.8 Lower interest expense 60 Lower contribution due to 50 spin-out of NGD segment 38.3 40 Higher…
Net income per unit Net income per unit () 1.80 2006 1.67 1.60 0.52 per unit in 2005 and 1.40 1.33 2006 1.20 Weighted average units 1.00 outstanding 54.8 million 0.84 0.80 0.70 compared to 53.4 million in 2005 0.60 0.52…
Net revenue by segment Net revenue by segment FG&P ( Millions) Capacity additions 296.9 300 More op cost flowthrough E&T: higher frac spreads 250 Power Generation 200 Higher power prices received Lower transmission charges…
EBITDA EBITDA ( Millions) First quarter 2006 155.5 160 46.1 million, or 0.4% 133.4 140 decrease over Q1-05 121.9 120 Q1-2005 included Taylor 94.8 100 gain on disposition of units 80 60 46.1 40 20 0 2002 2003 2004 2005…
Funds from operations Funds from operations ( Millions) First quarter 2006 128.2 10.5 million or 34% 120 108.6 increase over Q1-05 100 90.2 70.8 Q1-05 did not include gain 80 on sale of Taylor, as was 60 41.6 investing…
Financial structure Debt as a percentage of Committed to investment grade total capital* rating 60% Trust stability rating Target Range S&P: SR-3 50% DBRS: STA-3 (middle) 40% Rating on medium-term notes S&P: BBB- 30% DBRS: BBB…
Growth Strategy 20
2006 - High single digit growth in earnings Field Gathering and Processing 40+ million on organic growth 16 million announced to date Optimize and expand current facilities Develop new facilities in areas adjacent to current…
Coalbed methane Main Mannville in the WCSB Pilot Mannville Potential Horseshoe Canyon
Coalbed methane in West Central Alberta AJM Production Estimates for West Central Alberta (Mmcf) 2,000 1,659 1,694 1,500 1,174 1,084 1,000 500 0 2004 2005 2006 2007
West Central Alberta production 2005 = 1.2 Bcf/d 2010 = 1.4 Bcf/d 17% 47% 44% 18% 65% 9% Sweet Sour CBM & EDM Source: AJM Petroleum Consultants 24
2006 - High single digit growth in earnings Energy Services Continue growth in customer base in Ontario, B.C. and Alberta Becoming a national supplier of energy management services Single-digit growth in operating income Power…
The potential of wind power Opportunity to invest in almost 1000 MW of wind power over the next five years Growing demand for renewable generation Long-life assets Long-term contracts with creditworthy counterparties Provides…
Potential wind projects BRITISH COLUMBIA ALBERTA MANITOBA SASK. MONTANA NORTH DAKOTA 27
2006 acquisition strategy Up to 100 million available for acquisitions over 2006 Disciplined approach to acquisitions in all segments Net income accretive Return on equity accretive Maintain low risk profile Maintain…
Investment Highlights 29
AltaGas total return vs. indices Assumes a 100 investment on Dec. 31, 2000 and reinvestment of dividends/distributions 800 700 600 500 400 300 200 100 0 Dec. 31 2000 Dec. 31 2001 Dec. 31 2002 Dec. 31 2003 Dec. 31 2004…
Investment highlights Demonstrated track record of growth and value creation Over last 5 years, total return of 700% Solid business today with significant opportunities to continue to grow and build Were in business for the…
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