2014 Half Year Results Announcement Half Year Ended 31 December 2013 Grant King, Managing Director Karen Moses, Executive Director, Finance and Strategy 20 February 2014
Outline 1. Performance Highlights Grant King 2. Financial Review Karen Moses 3. Operational Review Grant King 4. Prospects Grant King 5. Appendix 3
1. Performance Highlights Grant King, Managing Director 4
Results Statutory Profit* 322 m down 39% Statutory EPS* 29.3 cps down 39% Underlying Profit* 381 m up 5% Underlying EPS* 34.6 cps up 4% Underlying EBITDA* 1,082 m up 3% Interim Dividend Unfranked 25.0 cps - - Group OCAT*…
Origin has made strong progress on its four key priorities Improving the Performance of the Existing Businesses Retail Transformation complete, Expansion of gas margins Increased availability and delivering operational and cash…
Investment in Retail Transformation at an end and beginning to deliver operational and cash flow improvements Retail Transformation Energy Markets Operating Cash Flow Transition of all Mass Market 700 customers onto SAP platform…
Stabilisation of Origins customer position through more effective customer retention and acquisition Net Movement in Customer Accounts (Natural Gas & Electricity) NEM Energy Demand Projections 20 (GWh) (MWh) Residential &…
While intense discounting is moderating in NSW, improvements in retail margins in the short term will be driven by discounts offered in prior and current periods Origins Average Signed Discount Offers for Electricity and Natural Gas…
Origin has strengthened its diverse gas supply portfolio Sources of Energy Markets East Coast Increase in Natural Gas PJ/a Gas Portfolio Customer Accounts 300 80 Ironbark (new equity gas)* Other purchases APLNG purchases Origin's…
Investments in upstream assets have delivered increased availability and production POTENTIAL DEVELOPMENT Availability of Origin Operated Plant Ironbark in Surat Basin for 6 month period Halladale/Black Watch in 100% Otway Basin…
APLNG is on track to deliver first LNG in mid-2015, creating a step change in Origins earnings and cash flows Upstream Downstream 58% Complete 62% Complete Estimated costs to complete are in line with budget Planning underway…
Despite operational improvements and the moderating of intense discounting in NSW, impact of prior and current period discounts will continue to impact margin recovery in the short term Improving operational Industry begins LNG…
2. Financial Review Karen Moses, Executive Director, Finance and Strategy
Underlying EBITDA up 3% to 1,082 million Underlying EBIT down 1% to 694 million Underlying EBITDA Underlying EBIT ( million) Dec 13 Dec12 Change Dec 13 Dec 12 Change Energy Markets 505 660 (23%) 372 516 (28%) Exploration &…
Reconciliation of Statutory Profit to Underlying Profit ( million) Dec 13 Dec 12 Change Statutory Profit 322 524 (202) No gain on Items Excluded from Underlying Profit dilution (-358m), foreign currency LNG related items (250) 294…
Statutory Profit down 39%, from 524 million to 322 million Statutory Profit Movement Dec 12 to Dec 13 600 500 524 (162) 193 27 (31) 11 (6) 400 18 (59) million 381 362 300 322 200 100 - HY2013 Net Items HY2013…
Group OCAT increased due to improved billing and collections performance ( million) Dec 13 Dec 12 Change Decreased Energy Markets debtors from billing & collections Underlying EBITDA 1,082 1,055 27 improvements (+268m), lower…
As a result of a number of funding initiatives during the period, Origin has 6.51 billion of committed undrawn debt facilities and cash as at 31 December 2013 Over the last 6 months, Origin undertook a number of funding initiatives…
An unfranked interim dividend of 25 cps has been determined, representing a payout ratio of 72% of Underlying EPS 60 Dec Half Jun Half 50 Ex-dividend date: 25 February 2014 Record Date: 3 March 2014 40 cents per share 25…
3. Operational Review Grant King, Managing Director
Energy Markets (m) Underlying EBITDA 800 600 660 505 400 200 Gas Gross Profit up 7 million Electricity Gross Profit down 130 million 0 Dec 12 Dec 13 Underlying EBIT margin* reduced from 9.4% to 7.2% predominantly…
Energy Markets EBITDA down 155 million primarily due to lower Mass Market volumes and impact of discounts from prior period Underlying EBITDA Bridge 700 (30) Mass Market volumes impacted by (52) warmest recorded winter (-30m)…
Both Electricity and Natural Gas Mass Market demand impacted by warmest September quarter in recorded history Cumulative Degree Days Electricity Mass Gas Mass TWh Market Volumes PJ Market Volumes 2,500 12 25 23.0 Down 15% 10.3…
Electricity Mass Market volumes also impacted by prior year customer losses, solar PV and energy efficiency Net Movements in Electricity Customer Accounts NEM Electricity Consumption H1 H2 H1 MWh per Capita FY2013 FY2013 FY2014…
Prior period discounting and competitive pressures compressing Electricity unit Gross Profit margin Electricity Performance (/MWh) Dec 13 Dec 12 Change Revenue Published electricity tariffs have moved largely in line with C&I…
Origin has reduced discounts in NSW, supported by a decrease in churn, while intense competition remains in VIC Origins Average Signed Discount Offers for Electricity and Natural Gas Churn Rates Electricity and Natural Gas (%) 40%…
The Eraring and Cobbora transactions, along with the Centennial Coal agreement, consolidated Origins generation and fuel position Generation Portfolio Performance Eraring and Cobbora Eraring Interm. Load/ Base Darling Downs…
Natural Gas unit Gross Profit expanded by 0.60/GJ reflecting the cost benefit of Origins diverse gas supply portfolio Natural Gas Performance (/GJ) Dec 13 Dec 12 Change Revenue C&I 7.5 6.0 1.5 Mass Market 21.4 20.4 1.0 Combined…
Origin has continued to gain customers, particularly in Natural Gas through dual fuel penetration in NSW Electricity and Natural Gas Customer Accounts Customer Account Movements Net gain Net gain 4,500 30 51,000 more gas customers…
Flat cost-to-serve per customer reflects efficiency of leveraging internal sales channels and new systems capability with a focus on customer retention Cost to serve Dec 13 Dec 12 Change Customer Wins and Retains 1000 Natural Gas,…
Exploration & Production (m) Underlying EBITDA 400 300 302 200 Higher production (+27%) and sales volumes (+26%) 1 192 Higher commodity prices 100 Flat operating costs 0 Dec 12 Dec 13 Higher production at Otway,…
Investments made in prior periods and higher availability in the current period have resulted in a 27% increase in production PJe Origin Gas and Liquids Production1 mmboe Otway 60 10.3 Production from Geographe 2 commenced in…
Activity is focused on offsetting natural decline in production from existing assets through near field development and exploration activities Ironbark Pilot testing at Duke 2 and 3 pilot Otway Basin wells progressing Drilling…
LNG (m) Underlying EBITDA 40 35 30 27 1 Increased production and sales volumes 20 Higher gas prices Higher operating costs reflecting higher labour costs 10 from increased activity to prepare for first LNG 0 Dec 12 Dec…
Upstream Project Progress - 58% complete and on track FY2014 Upstream Operated Goals Actual Progress to 31 December 2013 Plan First gas and water production from Q1 Accomplished: Reservoir performance is in line with expectations…
Downstream Project Progress - 62% complete and on track Downstream Operated FY2014 Actual Progress to 31 December 2013 Goals Plan Final Train 1 refrigeration Accomplished: All LNG refrigeration compressors (methane, ethylene Q1…
Construction, commissioning and operations of upstream assets will continue through calendar year 2014 Key near term project goals and milestones FY2014 FY2014 Upstream Operated Downstream Plan Plan First gas and water…
APLNG capital expenditure for the year was 5.3 billion, with Origins cash contribution 1.4 billion Cumulative Half Year to Estimate from FID1 to from FID1 to (Am) 31 December 1st sales from Train 2 December 2013 (Ab) 2013…
Contact Energy (m) Underlying EBITDA 300 180 232 200 198 100 Lower cost of generation Lower carbon and gas costs Strengthening of the NZ dollar 0 Dec 12 Dec 13 Lower generation costs with hydro displacing more…
Return to gas flexibility enables benefits from increased hydro generation Benefits of favourable fuel mix and upgraded infrastructure realised during the period Net purchase cost improved by NZ5/MWh Higher rainfall enabled…
4. Prospects Grant King, Managing Director
Despite operational improvements and the moderating of intense discounting in NSW, impact of prior and current period discounts will continue to impact margin recovery in the short term Improving operational Industry begins LNG…
5. Appendix
Important Notice Financial information All figures in this report relate to businesses of the Origin Energy Group (Origin, or the Company), being Origin Energy Limited and its controlled entities, for the half year ended 31 December…
Glossary - Statutory Financial Measures Statutory Financial Measures are measures included in the Interim Financial Statements for the Origin Consolidated Group, which are measured and disclosed in accordance with applicable Australian…
Glossary - Non-IFRS Financial Measures Non-IFRS Financial measures are defined as financial measures that are presented other than in accordance with all relevant Accounting Standards. Non-IFRS Financial measures are used internally by…
Glossary - Non-Financial Terms Term Meaning Proved Reserves are those reserves which analysis of geological and engineering data can be estimated with reasonable certainty to 1P reserves be commercially recoverable. There should be…
Upstream Project Progress Condabri Central, North and South Condabri Central - Gas Processing Facility Condabri Central - water and brine ponds Condabri North - Gas Processing Facility Condabri South - Gas Processing Facility…
Upstream Project Progress Talinga, Orana, Reedy Creek and Eurombah Creek Talinga Pipeline Compression Facility, Gas Processing Orana Gas Processing Facility Facility in background Reedy Creek Gas and Water Processing…
Downstream Project Curtis Island Curtis Island February 2013 Curtis Island December 2013 52
Thank you For more information Chau Le Group Manager, Investor Relations Email: chau.leoriginenergy.com.au Office: +61 2 9375 5816 Mobile: + 61 467 799 642 www.originenergy.com.au
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