Q2 2020 Financial Results Analyst Presentation Abu Dhabi National - PowerPoint PPT Presentation

Q2 2020 Financial Results Analyst Presentation Abu Dhabi National Energy Company (TAQA), 13 August 2020 POWERING A THRIVING FUTURE

Disclaimer These materials have been prepared by Abu Dhabi National Energy Company ( “ TAQA ” or the “ Company ” ). The information contained in this presentation may not have been reviewed or reported on by the Company ’ s auditors. The Company relies on information obtained from sources believed to be reliable but does not guarantee its accuracy or completeness. These materials have been prepared for information purposes only and do not form part of any 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 The information contained herein supersedes any previous such information delivered to you and will be superseded by any such information subsequently delivered. 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. This presentation may contain, or may be deemed to contain, "forward-looking statements" regarding future events or the future financial performance of the Company. These forward-looking statements include all matters that are not historical facts. The inclusion of such forward-looking information shall not be regarded as a representation by the Company or any other person that the objectives or plans of the Company will be achieved. The Company undertakes no obligation to publicly update or publicly revise any forward-looking statement, whether as a result of new information, future events or otherwise. Please note that rounding differences may appear throughout the presentation. 2

Q2 2020 – results summary Strong operational results with financial performance impacted by commodity price exposure Group financial highlights (AED million) Last set of financials reflecting TAQA-standalone prior to ADPower reverse-merger Revenues Strong operational performance across business lines Q2 2019 4,662 ● High technical availability levels maintained for contracted power and water businesses Q2 2020 3,337 ● Oil and gas production maintained despite delayed drilling campaigns EBITDA Q2 2019 2,407 Weaker financial performance due to COVID-19 impact on commodity prices Q2 2020 1,751 ● Revenue of AED 3.3bn (-28% Q2 y/y) Net income (TAQA-share) ● EBITDA of AED 1.8bn (-27% Q2 y/y) Q2 2019 208 Q2 2020 -205 Net loss (TAQA-share) of AED 205 million for Q2 2020 Free cash flow* ● Driven by lower revenues and largely fixed finance costs partially offset by lower opex Q2 2019 1,562 ● Finance costs slightly lower on reduced interest rates on floating rate portion of debt Q2 2020 1,061 Strong liquidity and steady net debt levels CAPEX ● Total liquidity at AED 11.0bn Q2 2019 474 ● Q2 2020 312 Higher gross debt on RCF drawdown (up AED 0.7bn y/y Q2) 3 * Free cash flows represent ‘ operating ’ less ‘ investing ’ cash flows

Power and water highlights Stability from contracted generation Power generation (GWh) Water desalination (MIG) Stable financial performance for contracted business 97.2% 97.6% ● Overall power and water revenues of AED 2.7bn (-9% y/y Q2) − 7,001 Flat for contracted UAE business 5,916 64,759 − 62,775 Down 22% for international power 17,523 17,572 1. Reduced demand and lower production at our single merchant asset (Red Oak, USA), and Q2 2019 Q2 2020 Q2 2019 Q2 2020 2. Lower fuel reimbursement revenues (on falling fuel cost trend and Int'l UAE Technical availability lower production) ● EBITDA of AED 1.7bn (-3% y/y Q2) Revenue & EBITDA (AED million) − Flat for UAE sub-segment 62% 59% − Down 15% for international power and water reflecting Red Oak losses Strong operational performance throughout Q2 2020 2,993 2,738 ● Technical availability at 97.6% (+0.4pp y/y Q2) 1,754 1,705 ● Total power generation of 23,488 GWh (-4% y/y Q2) Q2 2019 Q2 2020 ● Water volumes stable at 64,759 MIG (+3% y/y Q2) Revenue EBITDA EBITDA margin 4

Commodity price environment Volatile price environment remains a challenge ● ● TAQA realized oil price US$ 18.6/bbl vs US$ 61.8/bbl TAQA realized gas price US$ 1.7/mmBtu vs US$ 1.8/mmBtu) (-70% y/y Q2) (-6 % y/y Q2) Benchmark oil prices (US$/bbl) Benchmark gas prices (US$/mmBtu) 80 8 7 60 6 40 5 20 4 3 0 2 -20 1 -40 0 2019 2020 2019 2020 Brent WTI Henry Hub AECO NBP TAQA blended output energy price of US$ 13.3/boe vs US$ 35.3/boe (-62% y/y Q2) 5

Oil and gas highlights Stable overall volumes but significantly lower commodity prices Revenue & EBITDA (AED million) Strong operational results from the Oil & Gas segment 39% ● Global production at 123.1 mboepd (flat y/y Q2) despite delayed drilling campaigns ● 1,669 North America at 72.5 mboped (-8% y/y Q2), Europe 40.0 mboepd (+5%), 12% Iraq entitlement production at 10.7 mboepd (+84%) 659 599 69 Q2 2019 Q2 2020 Revenue EBITDA EBITDA margin Weaker financial performance on significantly lower commodity prices ● Revenues of AED 0.6bn (-64% y/y Q2); EBITDA of AED 69 mn (-90%) Average production (mboepd) ● No further impairments this quarter on oil and gas assets total: 122.9 total: 123.1 10.7 5.8 38.1 40.0 79.0 72.5 Q2 2019 Q2 2020 North America Europe Iraq 6

Liquidity and key ratios Strong liquidity levels and continued debt reduction Corporate debt maturity profile* (US$ million) Robust liquidity position ● Total liquidity of AED 11.0bn made up of: − Cash and cash equivalents of AED 4.6bn 2,848 − Undrawn credit facilities of AED 6.4bn 1,500 1,250 1,000 1,000 913 750 415 500 ● RCF drawdown of AED 2.8bn in early Q2 2020 0 2020 21 22 23 24 25 26 30 36 49 Bonds Drawn RCF Undrawn RCF Term loan Flat interest costs * as at 30 June 2020 ● Cash interest paid was flat versus the prior year period as higher gross Key ratios debt (AED 0.7bn higher) was offset by lower interest rates (drawn RCF) Q2 2019 Q2 2020 ● Net debt of AED 60.6bn (flat versus end-Q1 2020) Net debt / net capital ** 84% 85% EBITDA / Interest 2.8x 2.2x Net Debt / EBITDA LTM 6.4x 7.5x ** Net capital = net debt plus equity less accumulated changes in the fair value of derivatives 7

A brief overview of the new TAQA

ADPower and TAQA are writing history Creating a regional water and electricity champion that will transform the sector 23 GW of electrical 913 MIGD of water 20,000 km water, 124.4k boepd 11 countries with generation capacity desalination capacity 80,000 km electricity global production operations networks Strong credit AED 44bn AED 180bn & ability to revenues asset size of ) 85% of EBITDA is pay dividends the combined company long term contracted or regulated) 9 Note: Showing pro forma YE/FY 2019 figures for new TAQA

Key objectives achieved by TAQA – ADPower transaction Strengthened capital structure, secure cash flow profile and strong growth prospects Formation of one of the largest listed integrated utilities in the region holding the rights in A perpetuity for the regulated power and water network concessions in Abu Dhabi Creation of a national power & energy champion to lead sector transformation Enjoys exclusivity rights to participate in all future power and water generation B projects tendered in Abu Dhabi over the next ten years with a minimum 40% stake Highly predictable and secure cash flow profile underpinned by a transparent regulatory A framework and long term offtake contracts leading to more than 85% of EBITDA being Enhanced capital structure contracted or regulated with a strong balance sheet and secure cash flow profile Robust capital structure and immediate deleveraging of TAQA, with further performance B uplift potential from integration Strong and stable company providing virtually all the critical power and water A infrastructure for the Abu Dhabi economy and the only vehicle available to invest in Essential infrastructure this sector company for Abu Dhabi with strong government support Positioned to capture the infrastructure growth expected in Abu Dhabi and selectively B seeking value-added growth outside the Emirate 10