E.ON - Cleaner & better energy Global Unit Gas - EOn
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
E.ON – Cleaner & better energy Global Unit Gas
E.ON strategy
From To
Integrated across Focus on competitive
value chain businesses
Investment
Less capital,
more value Targeted expansion
Eurocentric
outside Europe
Performance
Efficiency &
Europe effective Outside
Selective efficiency Sustainable performance
Focused & organization Europe programs culture
synergistic Targeted
positioning expansion
Capital intensive Competence-based
Cleaner & better energy
Transform European utility into global, specialized energy solutions provider
2E.ON Group strategic priorities
Performance
Æ Intensify cost & quality management
Challenging markets Æ Simplify structures
Political interventions Æ Execute portfolio measures
Æ Create balance sheet flexibility
Growth
Europe:
System transformation Æ Capture growth in renewables & decentralized energies
Outside Europe:
Æ Exploit opportunities in new markets
Growth & new technologies
Markets require intensified self-help measures
3E.ON Group key financial targets
y 2011E Adjusted EBITDA €bn 9.1 – 9.31
Adjusted EPS €/share 1.2 – 1.31
y 2013E Adjusted EBITDA €bn 11.6 – 12.32
Results Adjusted EPS €/share 1.7 – 2.02
y 2015E Adjusted EBITDA €bn 12.5 - 13.03
Adjusted EPS €/share 2.0 – 2.33
y Dividend payout policy % adj. net income 50 – 60
y 2011E €/share 1.0
Dividends y 2012E €/share 1.1
y 2013E €/share ≥1.1
y Rating target Solid single A
y Medium-term debt factorGlobal Unit Gas within E.ON’s structure
Group Management
Other EU Support
Generation Renewables Trading Gas Germany
countries
Russia
functions
Upstream
Midstream
Transport/Shareholdings
Other/Consolidation
Leaner and more market oriented organization
5Gas – Executive summary
Adapt LTCs to changed environment
Market environment y Renegotiation objective: restore competitiveness of LTCs and
derisk Supply & Sales business
y Systemic change of gas market
functioning y Renegotiation parameters: price level, indexation and review
mechanism
y Decoupling of oil-linked LTCs
and hub prices y 37% of LTC volumes successfully renegotiated so far
y Hub prices & forwards y Arbitration with Gazprom initiated
relevant price signal
y Growing integration of Portfolio re-orientation towards upstream and optimization
European markets y Develop further focused & skill-based upstream position
y Tightening of global LNG & y Production to expand by >20% between 2010 and 2013
regional shift y Adj. EBITDA to increase from €0.7bn (2010) to €1.7-2.1bn
y Uncertainty of long-term gas (2013)
demand growth in Europe y Enhance optimization earnings by adjusting portfolio and
bundling of gas supply, optimization and trading activities
Paradigm shift in European gas markets – Portfolio shift towards upstream and optimization
6Gas – Financials and outlook
Earnings drivers Outlook
Main earnings drivers
€2.0bn
y Upstream: further production growth and €1.1-1.6bn
higher prices
y Midstream: return of Supply & Sales to normal
after losses in 2011
Outlook 2011 compared to 2010
y Upstream: marginal improvement thanks to 2010A 2011E 2013E
higher prices
y Midstream: loss of less than €1bn assumed for Gas – FY 2010 financials
Supply & Sales €bn Sales Adj. EBITDA Adj. EBIT
Target 2013 compared to 2010 Upstream 1.4 0.7 0.4
Midstream 20.0 0.5 0.4
y Upstream: significant increase due to higher
Transport/Shareholdings 1.6 0.7 0.5
production and prices
Other/Consolidation -1.6 0.1 0.1
y Midstream: return to normal level assumed for
Gas 21.4 2.0 1.4
operational Supply & Sales business
Strong increase in upstream - Supply & Sales to return to normal in 2013
7Discussion Material
Global perspective (I)
Development of world gas demand Key drivers
Current policies
scenario Economic growth and energy policy are key
bcm 4,750 New policies determinants of future gas demand:
scenario
3,888 Advantages of natural gas
3,076 450 ppm
scenario y Ample supplies globally
Non
power
y Cleanest of all fossil fuels
Power y Highly efficient and flexible
2009 2020 2035
y Complement to renewable energy
2009-2035 gas demand growth by region
Asia/Pacific
Middle East Environmental context
Central-/Eastern Europe
y Reduction of CO2-emissions
North America
EU27 y Improved energy efficiency
South America
Africa y Increased deployment of renewable energies
0 100 200 300 400 500 600 700 800 bcm
Gas is not only a ‘bridge’ – it is a ‘destination’ fuel into a lower-carbon world
Source: IEA World Energy Outlook 2011, p.159, 544 ff. 9Global perspective (II)
LNG flows and pricing of purchase contracts
LNG
North-America Europe Asia
y Self-sufficient y Increasing import dependence y Import dependence
y Spot markets dominant y Long term contracts & spot markets y Oil-indexed long term contracts dominant
LNG increasingly interconnects 3 main gas regions, despite very different market structures
10Development of European gas markets (I)
Integration of European markets Changing market environment
y Transparent and competitive market environment
liquid illiquid y Market opening through national regulation
y Cross-border market integration by European
regulation
GTF
y European gas hubs: continuing growth of volumes
NBP
and deepening of liquidity
TTF GUD
y Strong correlation between national trading hubs
ZEE NCG
(NBP, ZEE, TTF, NCG)
PEG N CEGH
y Decoupling of oil-based LTC prices and hub prices
PEG S
TIGF PSV
Functioning integrated market for natural gas in Europe expected by mid/end of decade
11Development of European gas markets (II)
Pricing of long-term import contracts Pricing of sales contracts
35
Fixed prices Gas price link
y Prices for oil as competing fuel
for natural gas barely matter
30 Oil price link Spot anymore in the more liquid
Heavy fuel oil component compo- European markets
25 Light fuel oil component nent
y Hub prices and forwards have
Coal component become relevant price signals
€/MWh
20
for wholesale customers
Forwards
15 y Various price elements in the
markets (e.g. fixed price, oil-
10
indexation, spot price,
forwards, options, …).
5
BAFA
TTF
0
2013
2000
2002
2004
2010
2012
1996
1998
1990
1992
1994
2006
2008
1986
1988
1970
1972
1974
1976
1978
1980
1982
1984
Natural gas hubs set today the relevant price signals in the markets
12Portfolio Optimization
Gas hubs Oil & coal Integrated portfolio optimization
(NBP, TTF, NCG) markets
y Diversified and complementary supply, transport,
storage and sales portfolio
Gas Oil & coal y Intense cooperation across E.ON Group
Positions Positions
E&P
Internal Examples
LTC
Gas supply Portfolio Gas sales customers y Supply optimization: Various supply contracts
contracts Optimization contracts
and delivery points as well as access to
External
customers transportation capacity create opportunities to
LNG
minimize sourcing costs
Transport Storage y Sale of virtual storage in one country backed by
capacities capacities physical storage in another country creates
opportunities to optimize physical storage
TSO‘S SSO‘s
Integrated portfolio optimization across the group creates additional value
13Upstream
Portfolio Production
mmboe
y Active in entire E&P value chain with focus on y Continuous 60
early phase build up of
40
production
53 licenses
Exploration & (14 operated) y First produc- 20
Appraisal
tion of Skarv 0
6 developments
(3 operated) in 2012 2007A 2008A 2009A 2010A 2011E 2012E 2013E
Development
Russian gas North Sea gas Oil
12 producing fields
(4 operated) Adjusted EBITDA
Production 1.7-2.1
€bn
y Contribution
y Active as operator and non-operator of Skarv
0.7-0.9
y Strong skill set: expanding role as operator y Increase of 0.7
oil and gas 0.4
y North Sea: operating exploration (Norway),
developing (UK) & producing fields (UK) prices
y North Africa: onshore operator (Algeria) 2009A 2010A 2011E 2013E
Experienced & skilled niche player
14Midstream – Supply & Sales (I)
Gas sourcing 2010
Importer bears volume risk Producer bears price risk
y E.ON
Ruhrgas Nether-
Germany y Long-term “Take or Pay“ y Long-term supply
lands
685 TWh1 17%
23% purchase commitment commitment
y Others Others 8% y Obligation to actively develop y Obligation to supply at
(mainly Russia market competitive prices
27% Norway
E.ON
25%
Földgaz )
135 TWh
Basic principles of LTCs New developments/adaptations
Profile of LTC maturities y Efficient sales channel for y Hubs set relevant price signals
large volumes y Faster reactions to market
-schematic-
y Prerequisite for significant developments and changed
upstream and transport environment necessary
investments y Need to reflect changed market
y Entitlement to periodic conditions (price level, indexa-
renegotiation (price reviews) tion and adjustment conditions)
2010 2020 2030 2040
Long-term import contracts (LTCs) require adaptation to changed market environment
15
1. Gas year 2009-10Midstream – Supply & Sales (II)
Status of LTC re-negotiations
y Objective is to adjust LTC prices to fundamentally changed market conditions,
i.e. to restore an appropriate risk/return profile for the Supply & Sales business
y Several agreements on adjustment of LTCs already concluded, corresponding
Under to more than 1/3 of supply volumes for 2011
Renegotiated negotiation
~ 37% since 2011
y Besides substantial price reductions, adjustments have been achieved to
~ 40% address structural solutions as well; negotiations for further adjustments
continue
Additional
renegotiation y Arbitration proceedings with Gazprom initiated; it is expected that commercial
since 2012 discussions continue in parallel
~ 23%
y Renegotiation with Statoil started on 1 Jan 2012
Outlook Supply & Sales
y Uncertainty about final timing of y 2011 outlook: loss of less than €1bn
commercial agreements or arbitration y 2013 target: return to normal level assumed for
decisions create uncertainty about operational Supply & Sales business. Upside potential
earning levels out of additional catch-up effects from previous periods
Ensuring sustainability of LTCs on track – already more than 1/3 successfully renegotiated
16Midstream – Supply & Sales (III)
LNG regas capacity (bcm/a)1
10 y LNG imports complement pipeline imports to
8
offset decline of gas production in Europe
y Global competition for available LNG volumes
6
y LNG flows determined to a large extent by
4
differences in prices between various gas
2 consumption regions
0 y E.ON’s LNG regas portfolio ensures direct access
2009A 2010A 2011E 2012E 2013E to all major European gas markets and creates
destination and pricing flexibility for the
OLT Livorno2 LNG business
GATE
Grain
Huelva
Barcelona
1. LNG regas capacity in E.ON Group
2. Capacity according to project share (under construction)
Diversified access to LNG regas capacity provide destination and pricing flexibility
17Midstream - Gas Storage
Gas storage capacities (bcm)
12
y E.ON Gas Storage (EGS) is one of the leading
underground gas storage companies in Europe
9 y ~11 bn m³ of working gas capacity in Central
Europe (2010)
6 y Projects in Germany, Austria and UK
3
y Operating and/or marketing the capacity of 22
existing storage facilities
0 y Front runner in transparency and capacity
2007A 2008A 2009A 2010A 2011E 2012E 2013E
marketing
y Attractive and innovative products and services
Germany Austria UK Hungary y On the trunk line to main transport/transit
routes and trading hubs
y R&D of new technologies, such as H²- and
compressed air storage
Flexible storage portfolio to meet demand in alternative market environments
18Transport - Open Grid Europe
Network of Open Grid Europe
y Highest market share in Germany by grid length
(~12,000 km)
y Set up of NetConnect Germany (NCG), the most
liquid trading point in Germany since 2008
y Expansion of NCG by GRTgaz Deutschland, ENI
Gas Transport Deutschland and GVSNetz in 2009
y Integration of OGE L-Gas and Thyssengas into
NCG by 04/2011
y Adaptations of transport tariff system in
2008/2009, start of incentive regulation
y Implementation of ITO-Model (3rd EU regulatory
package) in 2010/2011
y Evaluation of strategic options
Market and innovation leader of the German gas transmission system
19Transport – Supply related shareholdings
Main pipeline assets
y Main supply related pipeline assets:
y 15.5% in Nord Stream
y 15.09% in Interconnector
Nord Stream
y 20% in BBL
BBL y 10% in NEL
OPAL y 20% in OPAL
Interconnector NEL
y Increasing European security of supply via further
diversification of transportation routes and by
linking new sources of supply (4th corridor)
y Intra-European transport infrastructure bridge
Southern supply
corridor price differentials between markets
y Pipeline assets provide attractive returns and
TAP stable earnings
In operation
Under construction
Project phase
Key role of infrastructure assets in securing long-term supplies
20Other Shareholdings
Geographic presence
y Operations in transit and growth markets
Countries with limited presence y Development of regional markets
Countries with strong presence y Realization of market potential and synergies
between the shareholdings
y Value enhancement through operational
excellence
y Main businesses and shareholdings outside
Germany:
y Hungary: 100% of E.ON Földgaz Trade
y Slovakia: 24.5% in SPP, 40.5% in Nafta
y Finland: 20% in Gasum
y Baltic countries: 47% in Latvijas Gaze, 39% in
Lietuvos Dujos, 34% in Eesti Gaas
y Luxemburg: 11% in Enovos
Shareholdings allow stable returns and synergies with core business
21E.ON Investor Relations Contact
Sascha Bibert
Head of IR T +49 2 11-45 79-5 42
sascha.bibert@eon.com
Peter Blankenhorn
Manager T +49 2 11-45 79-4 81
peter.blankenhorn@eon.com
What can we do to
François Poullet
Manager T +49 2 11-45 79-3 32 help you?
francois.poullet@eon.com
Marc Koebernick
Manager T +49 2 11-45 79-2 39
marc.koebernick@eon.com
Dr. Stephan Schönefuß
Manager T +49 2 11-45 79-48 08
stephan.schoenefuss@eon.com
Aleksandr Aksenov
Manager T +49 2 11-45 79-5 54
aleksandr.aksenov@eon.com
Carmen Schneider
Manager T +49 2 11-45 79-3 45
carmen.schneider@eon.com
Sabine Burkhardt
Executive Assistant T +49 2 11-45 79-5 49
sabine.burkhardt@eon.com
22E.ON IR and reporting calendar
Date Event Location
March 14, 2012 Annual Report 2011 Düsseldorf
May 3, 2012 AGM 2012 Essen
May 4, 2012 Dividend payment
May 9, 2012 Interim Report I: January – March 2012 Düsseldorf
August 13, 2012 Interim Report II: January – June 2012 Düsseldorf
23This presentation may contain forward-looking statements based on current assumptions and forecasts made
by E.ON Group management and other information currently available to E.ON. Various known and unknown
risks, uncertainties and other factors could lead to material differences between the actual future results,
financial situation, development or performance of the company and the estimates given here. E.ON AG does
not intend, and does not assume any liability whatsoever, to update these forward-looking statements or to
conform them to future events or developments.
24You can also read
