Disc la ime r T his do c ume nt do e s no t c o nstitute a re c o mme nda tio n b y ANZ Na tio na l Ba nk L imite d, Cra ig s I nve stme nt Pa rtne rs L imite d , F o rsyth Ba rr L imite d o r We stpa c Ba nking Co rpo ra tio n, a c ting thro ug h its Ne w Ze a la nd b ra nc h (to g e the r the “Jo int L e a d Ma na g e rs”), T ruste e s E xe c uto rs L imite d (“Bo nd T ruste e ”) o r a ny o f the dire c to rs, o ffic e rs, e mplo ye e s o r a g e nts o f the Jo int L e a d Ma na g e rs, the Bo nd T ruste e o r Z E ne rg y L imite d (“I ssue r”) to sub sc rib e fo r, o r purc ha se , a ny o f the Bo nds. No ne o f the I ssue r (e xc e pt a s re q uire d b y la w), the Jo int L e a d Ma na g e rs o r the Bo nd T ruste e , no r a ny o f the ir re spe c tive dire c to rs, o ffic e rs, e mplo ye e s o r a g e nts, a c c e pts a ny lia b ility wha tso e ve r fo r a ny lo ss a rising fro m this do c ume nt o r its c o nte nts o r o the rwise a rising in c o nne c tio n with the Offe r. T his do c ume nt is fo r pre limina ry info rma tio na l purpo se s o nly a nd is no t a n o ffe r to se ll o r the so lic ita tio n o f a n o ffe r to purc ha se o r sub sc rib e fo r the Bo nds a nd no p a rt o f it sha ll fo rm the b a sis o f o r b e re lie d upo n in c o nne c tio n with a ny c o ntra c t o r c o mmitme nt wha tso e ve r. T he info rma tio n in this do c ume nt is g ive n in g o o d fa ith a nd ha s b e e n o b ta ine d fro m so urc e s b e lie ve d to b e re lia b le a nd a c c ura te a t the da te o f pre pa ra tio n, b ut its a c c ura c y, c o rre c tne ss a nd c o mple te ne ss c a nno t b e g ua ra nte e d. Yo u sho uld no t de c ide to purc ha se the Bo nds until yo u ha ve re a d the Simplifie d Disc lo sure Pro spe c tus da te d 4 July 2012 re la ting to the Bo nds. T he I ssue r inte nds to o ffe r the Bo nds to the pub lic in Ne w Ze a la nd . No a c tio n ha s b e e n o r will b e ta ke n b y the I ssue r whic h wo uld pe rmit a n o ffe r o f Bo nds, o r po sse ssio n o r distrib utio n o f a ny o ffe ring ma te ria l, in a ny c o untry o r jurisdic tio n whe re a c tio n fo r tha t purpo se is re q uire d (o the r tha n Ne w Ze a la nd). T he Bo nds a re se nio r, se c ure d , fixe d ra te de b t o b lig a tio ns o f the I ssue r. T he Bo nds ra nk e q ua lly with e a c h o the r a nd the e xisting Se rie s o f b o nds issue d b y the I ssue r. Bo ndho lde rs a nd Z E ne rg y’ s b a nks sha re the sa me se c urity o n a n e q ua l ra nking b a sis, with b o th g ro ups ra nking b e hind se c urity he ld b y supplie rs o f c rude o il a nd re fine d pro duc ts o ve r pro duc ts e a c h o f the m ha s supplie d , a nd the ir pro c e e ds, to the e xte nt tha t it ha s no t re c e ive d pa yme nt o f the purc ha se pric e , a nd b e hind sta tuto rily pre fe rre d c re dito rs a nd (in c e rta in c irc umsta nc e s) o the r wo rking c a p ita l pro vide rs. Applic a tio n ha s b e e n ma de to NZX L imite d (“NZX”) fo r pe rmissio n to q uo te the Bo nds o n the NZDX ma rke t a nd a ll the re q uire me nts o f NZX re la ting the re to tha t c a n b e c o mplie d with o n o r b e fo re the da te o f distrib utio n o f this do c ume nt ha ve b e e n duly c o mplie d with. Ho we ve r, NZX a c c e pts no re spo nsib ility fo r a ny sta te me nt in this do c ume nt. NZX is a re g iste re d e xc ha ng e , a nd the NZDX is a re g iste re d ma rke t, e a c h re g ula te d unde r the Se c uritie s Ma rke ts Ac t 1988. Ca pita lise d te rms use d in this do c ume nt a nd no t o the rwise de fine d ha ve the me a ning s g ive n to the m in the Simplifie d Disc lo sure Pro spe c tus. No a pplic a tio ns will b e a c c e pte d o r mo ne y re c e ive d unle ss the sub sc rib e r ha s re c e ive d the Simplifie d Disc lo sure Pro spe c tus. 2
Spe a ke rs a nd a g e nd a Spe a ke rs � Mike Be nne tts – Chie f E xe c utive � Ma rk E d g hill – Chie f F ina nc ia l Offic e r � Ric ha rd No rris – T re a sure r Ag e nda � Offe r hig hlig hts � Z E ne rg y � Busine ss o ve rvie w � Busine ss mo de l � Busine ss o pe ra tio ns � Bra nd � F ina nc ia l o ve rvie w � Se c urity struc ture a nd o the r ke y Bo nd te rms � I ssue time ta b le 3
Offe r hig hlig hts Z E ne rg y L imite d Issue r Se nio r, se c ure d , fixe d ra te b o nd s Bonds E q ua l ra nking with Z E ne rg y’ s Ba nks a nd e xisting b o ndho lde rs Se c urity Up to $100m with o ve rsub sc riptio ns o f up to $50m Issue Size 15 No ve mb e r 2019 (~7 ye a rs) Ma turity 6.50% p.a . pa id q ua rte rly in a rre a rs Inte re st Ra te No t ra te d Ra ting Quota tion Applic a tio n to q uo te the Bo nd s o n NZDX ha s b e e n ma d e ANZ Joint L e a d Ma na g e rs Cra ig s I nve stme nt Pa rtne rs F o rsyth Ba rr We stpa c I nstitutio na l Ba nk 4
Busine ss o ve rvie w � Stra te g ic a lly impo rta nt Ne w Ze a la nd e ne rg y c o mpa ny � Sta b le ma rg in b usine ss � Ope ra tio n o f sub sta ntia l lo g istic a l a nd distrib utio n infra struc ture � 300 re ta il se rvic e sta tio ns a nd truc k sto ps, pipe line s, fue l te rmina ls, 17.14% ho ld ing in Ne w Ze a la nd’ s o nly o il re fine ry a t Ma rsd e n Po int a nd 25% ho ld ing in L o ya lty NZ (F lyb uys) � Ma rke t le a d e r in mo st se g me nts in whic h it o pe ra te s � Distrib ute s c irc a o ne third o f Ne w Ze a la nd’ s to ta l fue l � One o f Ne w Ze a la nd’ s mo st visib le b ra nds � L o c a lly o wne d a nd o pe ra te d 5
Busine ss mo d e l � Z E ne rg y is a sta b le ma rg in b usine ss � Pro fita b ility: b uy-se ll ma rg in, minus the c o sts a sso c ia te d with pro c e ssing , tra nspo rt, sto ra g e , d istrib utio n a nd re ta iling � Pric e s a t whic h pro d uc t is purc ha se d a nd o n-so ld mo ve to g e the r - sub sta ntia lly re duc e s the risk a sso c ia te d with fluc tua tio ns in inte rna tio na l o il pric e s o r the va lue o f the NZD � Z E ne rg y will b e ta rg e ting inve stme nt o ppo rtunitie s a nd e a rning s g ro wth, suppo rte d b y sha re ho ld e rs 6
Busine ss mo d e l c o nt. � De fining c ha ra c te ristic o f the Ne w Ze a la nd fue ls ma rke t is the re la tive sta b ility o f c o nsumptio n a nd the mute d impa c t o f pric e o ve r the lo ng te rm � Co nsumptio n mo re re c e ntly ha s d e c line d, po te ntia lly a s a re sult o f g e ne ra l e c o no mic d o wnturn 7
Busine ss o pe ra tio ns Proc ure me nt a nd inve ntory � I mpo rts ~ 2 b illio n litre s c rud e a nd 500m litre s re fine d pro d uc ts p.a . � I nve nto ry va rie s ~ 300m - 650m litre s � 31 Ma rc h 2012 – 605m litre s va lue d a t $671m � 2011 – ra n a c o mpe titive pro c ure me nt pro c e ss fo r the supply o f finishe d pro d uc ts � Crud e o il - a rra ng e me nt with She ll until a t le a st April 2013 � We ll pla c e d to b e ne fit fro m c o mpe titive g lo b a l c rud e supply ma rke ts Re fining a nd Na tiona l Distribution � 17.14% ho ld ing in NZRC – ma rke t va lue $130m-$230m during F Y2012 � Circ a 75% o f the fue ls distrib ute d b y Z E ne rg y a re re fine d lo c a lly � NZRC $365m pro je c t inve stme nt – se lf funde d � Re fine d fue ls a re distrib ute d na tio na lly b y pipe line , ro a d a nd c o a sta l ta nke rs 8
Busine ss o pe ra tio ns c o nt. T e rmina ls, stora g e a nd re g iona l distribution � F ue l is sto re d a nd d istrib ute d fro m 12 o wne d o r le a se d te rmina ls a ro und NZ � Distrib ute d fro m the te rmina ls b y c o ntra c te d ro a d ha ula g e to re ta il pe tro l sta tio ns, truc k sto ps a nd d ire c tly to c o mme rc ia l c usto me rs � Je t fue l d e live re d to Auc kla nd Airpo rt b y pipe line � Ma rine fue ls distrib ute d fro m po rt sto ra g e , ro a d ta nke rs a nd b a rg e s Re ta il de live ry � Z E ne rg y ha s ~208 re ta il se rvic e sta tio ns (o wne d o r le a se d ) � ~50% o f Z E ne rg y’ s to ta l fue l vo lume s a re distrib ute d thro ug h the re ta il c ha nne l � E a c h Z se rvic e sta tio n dispe nse s ~5.8m litre s o f fue l pe r ye a r (o n a ve ra g e ), a lmo st twic e the a ve ra g e o f the re st o f the industry � Se rvic e sta tio n o pe ra ting mo d e l: pa id a c e nts-pe r-litre fe e o n fue l sa le s / sha re o f sho p sa le s / me e t so me o f the o pe ra ting c o sts � I nte nse c o mpe titive pre ssure – c usto me rs c ho o se whic h c o mpa ny the y wish to suppo rt b a se d o n c o nve nie nc e , q ua lity o f fue ls a nd pro duc ts, se rvic e , pric e a nd lo ya lty sc he me s 9
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