Moving forward confidently Investor Presentation June 2018
2 2 Spire | Investor Presentation | June 2018 Spire | Investor Presentation | June 2018
Forward-looking statements and use of non-GAAP measures This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Our forward- looking statements in this presentation speak only as of today, and we assume no duty to update them. Forward-looking statements are typically identified by words such as, but not limited to: “estimates,” “expects,” “anticipates,” “intends,” and similar expressions. A lthough our forward-looking statements are based on reasonable assumptions, various uncertainties and risk factors may cause future performance or results to be different than those anticipated. For a more complete description of these uncertainties and risk factors, see our Form 10-K for the fiscal year ended September 30, 2017 as filed with the Securities and Exchange Commission (SEC). This presentation also includes “net economic earnings,” “net economic earnings per share,” “contribution margin,” “adjusted EBI TDA,” and “adjusted long- term capitalization,” non - GAAP measures used internally by management when evaluating the Company’s performance and results of operations. Net economic earnings exclude from net income the after-tax impacts of fair-value accounting and timing adjustments associated with energy-related transactions, the impacts of acquisition, divestiture, and restructuring activities and the largely non-cash impacts of other non- recurring or unusual items such as certain regulatory, legislative, or GAAP standard-setting actions. In fiscal 2018, these items include the revaluation of deferred tax assets and liabilities due to the federal Tax Cuts and Jobs Act and write-off of certain long-standing assets related to pension costs and property sold as a result of disallowances in our Missouri rate proceedings. The fair value and timing adjustments, which primarily impact the Gas Marketing segment, include net unrealized gains and losses on energy-related derivatives resulting from the current changes in fair value of financial and physical transactions prior to their completion and settlement, lower of cost or market inventory adjustments, and realized gains and losses on economic hedges prior to the sale of the physical commodity. Management believes that excluding these items provides a useful representation of the economic impact of actual settled transactions and overall results of ongoing operations by facilitating comparisons of year-over-year results. Contribution margin is defined as operating revenues less natural and propane gas costs and gross receipts tax expense, which are directly passed on to customers and collected through revenues. These internal non-GAAP operating metrics should not be considered as an alternative to, or more meaningful than, GAAP measures such as operating income or net income. Adjusted EBITDA is earnings before interest, income taxes, depreciation and amortization, plus largely non-cash write-offs related to Missouri rate cases. Reconciliations of net income to net economic earnings and of contribution margin to operating income are contained in our SEC filings and in the Appendix to this presentation. Reconciliations of adjusted EBITDA to net income and of capitalization per balance sheet to adjusted long-term capitalization are also contained in the Appendix. Note: Years shown in this presentation are fiscal years ended September 30, unless otherwise indicated. Investor Relations contact Scott W. Dudley Jr. Managing Director, Investor Relations 314-342-0878 Scott.Dudley@SpireEnergy.com 3 Spire | Investor Presentation | June 2018
At Spire, we’re connecting people and energy Our mission Answer every challenge, advance every community and enrich every life through the strength of our energy. Transforming our company • Growing organically • Investing in infrastructure • Acquiring and integrating • Innovation and technology 4 4 Spire | Investor Presentation | June 2018
We’re expanding to serve more customers and markets • We’ve transformed our company by increasing our geographic footprint • Our gas companies serve 1.7 million homes and businesses across Alabama, Mississippi and Missouri • We are advancing our other businesses – Expanding into gas storage – Pursuing Spire STL Pipeline – Opening a business center in Houston to support Spire Marketing 5 Spire | Investor Presentation | June 2018
Moving forward confidently • Moving forward with clarity after regulatory reset • Executing on our strategy with confidence • Driving regulated growth • Advancing our non-regulated businesses • Strengthening our financial position 6 Spire | Investor Presentation | June 2018
Regulatory certainty offers clarity • Missouri rate cases finalized, parameters set – Rate base, ROE, equity capitalization, cost of service – Rate design harmonized across Spire Missouri – ISRS reset and renewed • Finalized RSE reset for Spire Gulf and updated Spire Mississippi rates • Spire Alabama RSE parameters under review • Weather normalization across all our utilities • Reduced all customer rates as a result of tax reform 7 Spire | Investor Presentation | June 2018
We are building rate base Capital expenditures forecast (Millions) 5-year forecast: $2.5B • 2018 capex forecast now $500M $560 $500 $500 – Higher utility spend of $425M $490 110 $475 10 10 10 75 70 70 70 – $80M for new business investment 70 60 • Increased our 5-year capital spend forecast to $2.5 billion 420 410 395 380 365 – Supported by utility infrastructure upgrade programs with lives up to 20 years – ~85% recovered with minimal lag 2018 2019 2020 2021 2022 or reflected in earnings Utility, with minimal lag Other Pipelines and new business utility and storage • Expect annual rate base growth ~6% Rate base 1 growth • Balanced spending (Billions) $2.6 29% Missouri East Missouri West 29% Alabama/Mississippi Pipelines and storage 33% 9% 2017 2018 2019 2020 2021 2022 1 Rate base for Missouri utilities per order authorized 2/21/18 for cases C-GR-2017-0215 and C-GR-2017- 0216, plus retained shareholders’ equity for Spire Alabama and Spire Gulf per current RSE effective 12/1/17, and Spire Mississippi rate base per stipulation 4/10/18. 8 Spire | Investor Presentation | June 2018
We’re growing organically Total utility customers 1 (Millions) 1.68 1.69 1.8 1.57 1.55 1.5 • Targeting programs that add 1.12 1.2 customers and increase utility margin 0.9 0.63 – Enhanced new business approach 0.6 – More focused economic development 0.3 • Seizing market opportunities through 0 2012 2013 2014 2015 2016 2017 – Strategic line extensions providing 1 Rolling 12- month average customers for all gas utilities for period of Spire’s natural gas to growing communities ownership and average customers of acquired utilities for period of ownership in the year of acquisition. – Pursuit of multi-family segment O&M expenses per customer 2 • Year-to-date in fiscal 2018 we have $300 $285 – Increased new business spend ~40% $276 $270 $275 – Installed 5% more new meters $252 $244 $241 $250 • Managing O&M expenses $225 $200 2012 2013 2014 2015 2016 2017 2 Operation and maintenance (O&M) expenses and customers for Spire Missouri, Spire Alabama and Spire Gulf for all years. 9 Spire | Investor Presentation | June 2018
We’re investing in pipelines • Progressing on Spire STL Pipeline – Anticipate FERC approval in 2018 – Ready to begin construction • 65-mile pipeline connecting to REX to bring shale gas to Missouri East • Targeting 2019 in-service date and investment of $190 - $210 million • Evaluating other opportunities in Missouri and Alabama 10 Spire | Investor Presentation | June 2018
11 11 Spire | Investor Presentation | June 2018 Spire | Investor Presentation | June 2018
Spire Marketing is expanding its reach • Positioning Spire Marketing for continued growth and success – Named industry veteran, Pat Strange, to lead the business and grow the team – Expanding geographically by opening a business center in Houston – Strengthening our strategic position • Strong YTD 2018 net economic earnings of $0.29 per share – Improved market conditions and wider regional basis differentials – Greater storage optimization and volumes 12 Spire | Investor Presentation | June 2018 Pat Strange, Spire Marketing President
We’re investing in natural gas storage • Acquired storage facility in Wyoming – Interconnections with five interstate pipes and access to REX ‒ Strategically located near Opal hub ‒ Positioned to serve multiple regions and customers (utilities, power generators, marketers and pipelines) • Hired Laura Luce who brings extensive experience in storage • We’re enhancing operating and financial performance • Spire Storage expected to add to FY19 NEE per share 13 Spire | Investor Presentation | June 2018
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