INVESTOR PRESENTATION NOVEMBER 2019
LEGAL DISCLAIMER Statements made by representatives for ATCO Ltd. and Canadian Utilities Limited and information provided in this presentation may be considered forward-looking statements. By their nature, such statements are subject to numerous known and unknown risks and uncertainties and therefore actual results may differ materially from those currently anticipated. ATCO Ltd. and Canadian Utilities Limited disclaim any intention or obligation to update or revise such statements. Due to the nature of the Corporation’s operations, quarterly revenues and earnings are not necessarily indicative of annual results. INVESTOR PRESENTATION NOVEMBER 2019
TABLE OF CONTENTS 1 ATCO Group Overview Page 5 2 Canadian Utilities Limited Page 11 Regulated Utility Businesses Page 15 Energy Infrastructure Businesses Page 17 3 Other ATCO Investments Page 25 Structures & Logistics Page 27 Neltume Ports Page 37 Commercial Real Estate Page 45 4 Appendix Page 47 INVESTOR PRESENTATION NOVEMBER 2019
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GROUP OVERVIEW 5
ORGANIZATIONAL STRUCTURE (TSX: ACO.X / ACO.Y) ~$6 billion common equity capitalization INVESTOR PRESENTATION NOVEMBER 2019 6
TRACK RECORD OF SUCCESS: EARNINGS GROWTH ATCO Canadian Utilities $607 million $355 million in 2018 in 2018 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 INVESTOR PRESENTATION NOVEMBER 2019 7
CONTINUED DIVIDEND GROWTH ATCO Canadian Utilities $1.69 $1.62 per share per share 47 years of annual dividend increases* 26 years of annual dividend increases* Longest track record of annual dividend increases of any Canadian publicly traded company 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 * On October 10, 2019, ATCO declared a fourth quarter dividend of $0.4048 per share, or $1.62 per share annualized. *On October 10, 2019, Canadian Utilities declared a fourth quarter dividend of $0.4227 per share, or $1.69 per share annualized. INVESTOR PRESENTATION NOVEMBER 2019 8
ATCO CREDIT RATINGS DBRS S&P INVESTOR PRESENTATION NOVEMBER 2019 9
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CANADIAN UTILITIES ENERGY INFRASTRUCTURE 11
ORGANIZATIONAL STRUCTURE Canadian Utilities (TSX: CU / CU.X) CU Inc. ~$11 billion common ~$8 billion equity capitalization debt capitalization INVESTOR PRESENTATION NOVEMBER 2019 12
HIGH QUALITY EARNINGS 2018 ADJUSTED EARNINGS 86% Regulated Earnings 14% Long-term Contracted Earnings INVESTOR PRESENTATION NOVEMBER 2019 13
GROWTH: Q3 2019 YTD EARNINGS $432M $420M Q3 2018 YTD Q3 2019 YTD INVESTOR PRESENTATION NOVEMBER 2019 14
REGULATED UTILITIES ELECTRIC TRANSMISSION ELECTRIC DISTRIBUTION $5,095M Rate Base $2,585M Rate Base NATURAL GAS TRANSMISSION INTERNATIONAL NATURAL GAS NATURAL GAS DISTRIBUTION $1,802M Rate Base DISTRIBUTION $2,717M Rate Base $1,211M Rate Base INVESTOR PRESENTATION NOVEMBER 2019 15
RATE BASE GROWTH Mid-Year Rate Base Regulated Capital Investment Expected to Grow 3%- 4% per year $1.2B $1.2B $1.1B $11.9B $12.5B $12.9B $13.4B $1.1B $1.2B $10.3B $1.1B $8.9B $1.5B $2.2B $2.3B 2013 2014 2015 2016 2017 2018 2019 2020 2021 2013 2014 2015 2016 2017 2018 2019 2020 2021 INVESTOR PRESENTATION NOVEMBER 2019 16
ENERGY INFRASTRUCTURE BUSINESSES ELECTRICITY GENERATION ELECTRICITY GENERATION ELECTRICITY GENERATION CANADA AUSTRALIA MEXICO 24 MW 176 MW 44 MW INDUSTRIAL WATER SERVICES HYDROCARBON STORAGE NATURAL GAS STORAGE CANADA CANADA CANADA 85,200 m 3 /day 400,000 m 3 52 PJ INVESTOR PRESENTATION NOVEMBER 2019 17
CAPITAL RECYCLING: CANADIAN ELECTRICITY GENERATION SALE • Sold our entire Canadian fossil fuel- based power generation portfolio for aggregate proceeds of $821 million in September 2019 • 12 coal-fired and natural gas-fired electricity generation assets located in Alberta, British Columbia, Saskatchewan and Ontario, with generating capacity of approximately 2,200 MW INVESTOR PRESENTATION NOVEMBER 2019 18
CANADIAN UTILITIES DIRECT GREENHOUSE GAS EMISSIONS INVESTOR PRESENTATION NOVEMBER 2019 19
ELECTRICITY GENERATION POST SALE Highly Contracted Expanding Renewable Portfolio Generation Capabilities Merchant 24 MW (10%) Hydro 59 MW (24%) Long-Term Natural Gas Contracted 185 MW 220 MW (76%) (90%) INVESTOR PRESENTATION NOVEMBER 2019 20
ELECTRICITY GENERATION POST SALE CAPACITY RUN-OF-RIVER HYDRO SHARE (MW) 1 OLDMAN RIVER 24 2 VERACRUZ 35 NATURAL GAS 3 SAN LUIS POTOSI 9 4 KARRATHA 86 5 OSBORNE 90 TOTAL 244 INVESTOR PRESENTATION NOVEMBER 2019 21
CAPITAL RECYCLING: ALBERTA POWERLINE SALE • Sold Alberta PowerLine Limited Partnership (APL) for total proceeds of approximately $300 million, and the assumption of approximately $1.4 billion of APL debt • Seven Indigenous communities acquired 40 per cent equity interest in APL • Canadian Utilities will remain the operator of APL over its 35-year contract with the Alberta Electric System Operator • The sale is expected to close in the fourth quarter of 2019. INVESTOR PRESENTATION NOVEMBER 2019 22
CAPITAL INVESTMENT APPROACH • Disciplined and prudent approach • Utility and utility-like assets: regulated or long-term contracted • “A” range credit rating focus • The ability to leverage our operating model • Geographic diversification: Outside Alberta, North America, Latin America, & Australia INVESTOR PRESENTATION NOVEMBER 2019 23
CANADIAN UTILITIES SUMMARY International Natural Gas Distribution Natural Gas Transmission Natural Gas Distribution Electricity Transmission Electricity Distribution INVESTOR PRESENTATION NOVEMBER 2019 24
OTHER ATCO INVESTMENTS 25
ATCO FOCUS: GLOBAL ESSENTIAL SERVICES INVESTOR PRESENTATION NOVEMBER 2019 26
STRUCTURES & LOGISTICS Modular Structures Workforce Housing & Space Rentals • Permanent modular construction • Mobile office trailers • Relocatable modular buildings Logistics and Facility O&M Services Lodging & Support Services • Facility operations • Lodging, catering • Maintenance services • Maintenance • Emergency management & disaster • Waste management response services INVESTOR PRESENTATION NOVEMBER 2019 27
STRUCTURES & LOGISTICS ADJUSTED EARNINGS $23M $15M $6M 2017 2018 Q3 YTD 2019 INVESTOR PRESENTATION NOVEMBER 2019 28
STRUCTURES & LOGISTICS Modular Structures increased rental utilization by 14 per cent since 2016 71% 70% 63% 57% 2016 2017 2018 Q3 YTD 2019 INVESTOR PRESENTATION NOVEMBER 2019 29
STRUCTURES & LOGISTICS Winning key Modular Structures contracts • LNG Canada Workforce Accommodation 4,500 person camp construction underway to house construction workers on LNG Canada’s facility in Kitimat, B.C. • Coastal Gaslink Pipeline 3 camps serving providing operational and support services for pipeline workers across northern B.C. • Chico, California fire disaster relief 1,500 person camp for fire disaster relief efforts near Paradise, California Tuscan Ridge Lodge, Paradise, California INVESTOR PRESENTATION NOVEMBER 2019 30
STRUCTURES & LOGISTICS Diversifying the global customer base into non-traditional modular markets such as public education facilities, high density urban residential housing, hotels and correctional facilities $65M $44M Dandenong North Primary School Thomastown School Victoria, Australia Victoria, Australia Melbourne Girls Grammar 130-student dormitory Melbourne, Australia Langley, Canada INVESTOR PRESENTATION NOVEMBER 2019 31
ATCO SABINCO (ULTRAMAR PARTNERSHIP) New 100,000 sq. ft. Chilean Manufacturing Facility further cements the business foundation we are re-establishing in South America. Arica Iquique Antofagasta 2% 7% Copiapó Mining 12% Curauma Energy Santiago Infrastructure Construction 47% Ranked #3 in Overall Modular Construction 15% vs Main Competitors Industrial 8 Sales Talcahuano Offices Others Puerto Montt 17% Diversified customer base led by copper mining Ranked #2 in Space Rental Market Share vs Main Competitors INVESTOR PRESENTATION NOVEMBER 2019 32
ATCO ESPACIOMOVIL • In 2018, Structures & Logistics acquired a majority ownership position in ATCO Espaciomovil, a leading modular building manufacturer in Mexico. • ATCO is now the largest manufacturer of modular products in the Mexican market, with the second largest fleet of modular rental assets in the country. 182,000 sq. ft. manufacturing plant in Guadalajara, Mexico o Approximately 1,300 modular rental units in operation o The fleet is currently 80 per cent utilized on existing rental contracts o • ATCO Espaciomovil serves a diverse customer base across Mexico and Central America. INVESTOR PRESENTATION NOVEMBER 2019 33
ATCO STRUCTURES AUSTRALIA INVESTOR PRESENTATION NOVEMBER 2019 34
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