Investor presentation
September 2015
Abu Dhabi National Energy Company PJSC (TAQA)
September 2015 Investor presentation www.taqaglobal.com
September 2015 Investor Presentation
These materials have been prepared by the Abu Dhabi National Energy Company - TAQA (“Company”). These materials are for information purposes only and do not constitute a prospectus, offering memorandum or offering circular or an offer to sell any securities and are not intended to provide the basis for any credit or any third party evaluation of any securities or any offering of them and should not be considered as a recommendation that any investor should subscribe for or purchase any securities. The information contained herein is preliminary as of the date hereof, supersedes any previous such information delivered to you and will be superseded by any such information subsequently delivered. Any investor who subsequently acquires any securities must rely solely on any final offering memorandum published in connection with such securities, on the basis of which alone purchases of or subscription for any securities may be made. In addition, investors should pay particular attention to any sections of any such final offering memorandum describing any risk factors. The information contained herein is subject to change without notice and past performance is not indicative of future results. The Company is under no obligation to update or keep current the information contained herein. No person shall have any right of action (except in case of fraud) against the Company or any other person in relation to the accuracy or completeness of the information contained herein. The merits or suitability of any securities to any investor's particular situation should be independently determined by such investor. Any such determination should involve inter alia, an assessment of the legal, tax, accounting, regulatory, financial, credit and other related aspects of any securities. No person is authorized to give any information or to make any representation not contained in and not consistent with these materials and, if given or made, such information or representation must not be relied upon as having been authorized by or on behalf of the Company. These materials are confidential and are being submitted to selected recipients only. They may not be taken away, reproduced (in whole or in part), distributed or transmitted to any other person without the prior written consent of the Company.These materials are not intended for distribution to, or use by any person or entity in any jurisdiction or country where such distribution or use would be contrary to local law or regulation. In particular, these materials are not intended for distribution, except (i) to accredited investors as defined under applicable Canadian securities laws, (ii) within the United States to persons that are qualified institutional buyers under Rule 144A under the U.S. Securities Act of 1933, as amended (the "Securities Act") and (iii) outside the United States to persons that are not U.S. persons (as defined in Regulation S under the Securities Act) in offshore transactions in compliance with Regulation S. These materials contain, or may be deemed to contain, "forward-looking statements" (as defined under applicable Canadian securities laws and in the U.S. Private Securities Litigation Reform Act of 1995). By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. The future results of the Company may vary from the results expressed in, or implied by, the following forward looking statements, possibly to a material degree. Any investment in securities is subject to various risks, such risks should be carefully considered by prospective investors before they make any investment decisions.
Disclaimer
September 2015 Investor Presentation
H1 2015 Results Summary
Low commodity price environment
Average realized prices for our UK and North American businesses down 45% and 54%, respectively, over the
same period
Our focus
Aggressive cost reduction program
Selective capital investment and improved efficiency
Enhanced focus on safety and reliability
Operational performance
Strong power and water production and availability
Mitigating oil and gas production decline
Completing major projects
Financial performance
Revenues and EBITDA down 29% and 35%, respectively, from H1 2014
Net Income US$45 million loss, compared with profit of US$140 million H1 2014
Strong liquidity
Refinanced $3.1 billion revolving credit facilities maturing in 2015 and 2017
Cash and cash equivalents of US$981 million as at 30 June 2015
Available liquidity stood at US$ 3.8 billion at the end of the period
3
September 2015 Investor Presentation
Strong Relationship with the Abu Dhabi Government
Ownership of strategic power & water assets in Abu Dhabi
Majority ownership of 8 IWPP that provide more
than 95% of Abu Dhabi’s water and electricity
needs
Active government oversight
74.4% indirectly owned by the Government of Abu
Dhabi
All members of the board are high-ranking government
employees
Ongoing oversight by the Debt Management Office of
Abu Dhabi
Tangible support from the Government
Transfer of 54% ownership in eight power & water plants in the UAE since 2005
Equity injection of US$ 740 million through subscription in convertible debenture offering in 2008
Transfer of Government stake in Sohar Aluminium smelter and a stake in Tesla motors
Change of Control Put Option upon the government’s ownership falling below 50%.
Note: Securities and loans issued by TAQA are not guaranteed by the Government of Abu Dhabi. The Department of Finance of Abu Dhabi is the most senior authority over Abu Dhabi fiscal policies and the Abu Dhabi Executive Council is
the effective Government body of the Emirate of Abu Dhabi.
4
Financial Support Fund for Farm Owners in the Emirate of Abu Dhabi
Abu Dhabi Water and Electricity Authority
(ADWEA)
Government of Abu Dhabi
Oil & Gas Power & Water
Other Governmental Entities
Public Shareholders
100% 100% 100%
21.7% 52.4%
25.6%
0.4%
September 2015 Investor Presentation
Prudent Financial and Risk Management Policy
Maintain strong liquidity
US$3.8 billion of cash and unutilized bank lines available as of 30 June 2015
Build strong relationship with a diversified group of banks
The RCF has been refinanced with support from international and regional banks
Manage debt maturity proactively to minimize refinancing risk
Develop diversified sources of funding to protect from market volatility
Commit to achieve a stand-alone investment grade credit rating
Debt Coverage Ratios Net Debt / Total Capital
5
81%
78% 77%
78%
81%
84% 84%
70%
75%
80%
85%
90%
2009 2010 2011 2012 2013 2014 2015
7.2 x 6.5 x
5.3 x 5.8 x 5.6 x
5.0 x
6.1 x
2.2 2.8 3.1
2.6 2.8 3.5 3.2
.0 x
1.0 x
2.0 x
3.0 x
4.0 x
5.0 x
6.0 x
7.0 x
8.0 x
2009 2010 2011 2012 2013 2014 H12015*
Net debt/EBITDA EBITDA/net interest
* Net debt/EBITDA ratio for H1 2015 is LTM
September 2015 Investor Presentation
Solid Financial Profile
6
Solid corporate credit ratings benefitting from government support
A3 (Stable) by Moody’s and A (Stable) by Standard & Poor’s
Stable and predictable Power & Water cash flows
Take or pay off-take agreements with government agencies
Limited exposure to cost volatility (costs/risks passed through to off-takers)
No exposure to demand volatility
Limited operating risk due to modern plants with high availability
Aggressive cost reduction in oil and gas assets to manage impact of commodity price volatility
EBITDA by business stream1
1,461 1,595 1,801 1,891 1,899
902
1,463
2,193 1,772 1,833 2,094
502
0
1,000
2,000
3,000
4,000
5,000
2010 2011 2012 2013 2014 H1 2015
Power & Water Oil & Gas
($ millions)
1 EBITDA by business stream does not add to consolidated EBITDA due to minor corporate expenses
Realized prices ($/boe)
- 20.00 40.00 60.00 80.00 100.00 120.00
North America
UK
NL
H1 15 H1 14
Operating costs ($/boe)
0.00 5.00 10.00 15.00 20.00 25.00 30.00 35.00 40.00
North America
UK
NL
H1 15 H1 14
September 2015 Investor Presentation
Financial performance Total sales revenue EBITDA
Net Income Total assets
USD Million USD Million
USD Million USD Million
3,752
2,678
0 1,000 2,000 3,000 4,000
H1 2014
H1 2015
2,151
1,408
0 500 1,000 1,500 2,000 2,500
H1 2014
H1 2015
140
-45
-50 50 150
H1 2014
H1 2015
33,272
30,812
29,000 30,000 31,000 32,000 33,000 34,000
H1 2014
H1 2015
September 2015 Investor Presentation
Balanced portfolio of assets
Current business:
$30.8 billion of total assets balanced between power & water and oil
& gas. As at June 2015:
16,300 MW1 gross power generation; 887 MIGD of water
desalination
Average technical availability of 91.2%
2P reserves of 522.3 mmboe
Average daily production of 150.0 mboe
Current Focus
Focus on safety and operational excellence
Reshaping the portfolio to create a leaner
more operationally efficient company
Cost transformation programme resetting the
cost base appropriate for lower commodity
price world
1 Excludes Sohar Aluminium plant 2 Average production for 2014 3 Under construction
Oil & Gas Assets2
NORTH AMERICA
• Oil & gas exploration and
production 89.5 mboe/d
UNITED KINGDOM
• Oil & gas exploration and
production 61.4 mboe/d
• Pipelines
NETHERLANDS
• Oil and gas exploration
and production 8.0
mboe/d
• Gas Storage
IRAQ
• 39.9% interest in the
Atrush exploration block
in the Kurdistan region
UAE
• Power generation (12,494 MW)
• Water desalination (887 MIGD)
USA
• Power plant tolling agreement (832)
• Wind power generation (205 MW)
INDIA
• Power generation (250 MW)
• Hydro Power Generation
(100MW) 3
SAUDI ARABIA
• Power generation (250 MW)
MOROCCO
• Power generation (2,056 MW)
GHANA
• Power generation (220 MW)
Power & Water Assets
September 2015 Investor Presentation
Takoradi 2, Ghana
Sorang hydro, India
Atrush, Kurdistan Region of Iraq
110 MW capacity expansion commissioning Q3 2015
Construction of 100 MW hydro power plant completed. Commissioning expected Q4 2015
All five first-phase wells drilled. Construction of 30,000 gross boed production systems ongoing
Major projects update
Fujairah 1, United Arab Emirates
30 MIGD reverse osmosis desalination facility expansion commissioning expected Q4 2015
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Full commercial operations commenced in April. 4.1 BCM of storage capacity available
Gas Storage Bergermeer, the Netherlands
September
2015 Investor
presentation
www.taqaglo
bal.com
September 2015 Investor Presentation
Cost Transformation program – ahead of expectations
• Global transformation program launched in January 2015 targeting AED 1.5 billion in annual cost savings by the end of 2016
• Achieved AED 758 million cash cost savings, ahead of 2015 target of AED 550 million
• Significant cost savings primarily in Europe, North America, Power and Water and Abu Dhabi Headquarters
Costs included are operating costs and net G&A
H1 15 vs H2 14: Cash cost savings
(AED Million)
211
381
76
90
North America Europe Power & Water HQ
September 2015 Investor Presentation
Capital Expenditure
Annual capex program reduced by
40% of the 2014 actual
expenditure ~ US$ 0.7 billion
Actual capex in H1’15 reduced by
36% compared to H1’14
Oil and gas capex reduced to core
and committed investments
Power and water capex lower than
prior years due to completion of
major projects
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US$ millions H1 2015 H1 2014
North America 74 178
UK 246 249
Netherlands 38 145
Iraq 39 29
Domestic Power 52 58
International Power 27 124
Corporate & Other 30 5
Total 506 789
September 2015 Investor Presentation
Corporate Debt Management
US$3.8 billion of liquidity available to fund
contingencies
US$0.9 billion of cash on hand
US$2.8 billion unutilised bank lines
Of US$20.5 billion consolidated debt as at 30
June 2015, US$10.8 billion is non-recourse
project debt with scheduled repayment profile
Remaining US$9.7 billion of corporate debt is
being actively managed
TAQA has historically pre-funded bond
maturities with new issuances
In August 2015, TAQA successfully
completed the refinancing of its corporate
credit facilities with a new 5 year $3.1
billion facility.
12
June 2015 Corporate debt maturity profile
Total outstanding US$9.7 billion
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
15 16 17 18 19 20 21 22 23 24 36
Bonds Utililised RCF Unutilised RCF
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