2018 Annual General Meeting. 17 October 2018

Transcription

1 2018 Annual General Meeting 17 October 2018

2 Important Notices Forward looking statements This presentation contains forward looking statements, including statements of current intention, statements of opinion and predictions as to possible future events. Such statements are not statements of fact and there can be no certainty of outcome in relation to the matters to which the statements relate. These forward looking statements involve known and unknown risks, uncertainties, assumptions and other important factors that could cause the actual outcomes to be materially different from the events or results expressed or implied by such statements. Those risks, uncertainties, assumptions and other important factors are not all within the control of Origin and cannot be predicted by Origin and include changes in circumstances or events that may cause objectives to change as well as risks, circumstances and events specific to the industry, countries and markets in which Origin and its related bodies corporate, joint ventures and associated undertakings operate. They also include general economic conditions, exchange rates, interest rates, regulatory environments, competitive pressures, selling price, market demand and conditions in the financial markets which may cause objectives to change or may cause outcomes not to be realised. None of Origin Energy Limited or any of its respective subsidiaries, affiliates and associated companies (or any of their respective officers, employees or agents) (the Relevant Persons) makes any representation, assurance or guarantee as to the accuracy or likelihood of fulfilment of any forward looking statement or any outcomes expressed or implied in any forward looking statements. The forward looking statements in this presentation reflect views held only at the date of this presentation. Statements about past performance are not necessarily indicative of future performance. Except as required by applicable law or the ASX Listing Rules, the Relevant Persons disclaim any obligation or undertaking to publicly update any forward looking statements, whether as a result of new information or future events. No offer of securities This presentation does not constitute investment advice, or an inducement or recommendation to acquire or dispose of any securities in Origin, in any jurisdiction October 2018 Annual General Meeting 2018

3 Chairman s address Gordon Cairns 17 October 2018

4 Outline 1. Our relationship with Aboriginal communities 2. Our membership of industry organisations 3. The political landscape 4. Good energy at Origin 4 17 October 2018 Annual General Meeting 2018

5 Our relationship with Aboriginal communities We act lawfully and respectfully with the Traditional Owners around our activities In the area around the Beetaloo Basin where we hold our exploration permits, the Northern Land Council determines our Native Title holders We seek to apply the principles of free, prior, informed consent to the agreements we have in place 5 17 October 2018 Annual General Meeting 2018

6 Our membership of industry associations Industry association membership allows us to advocate on behalf of our customers and shareholders We continually assess alignment of the energy and climate policy positions of these associations with our own We are improving our disclosure in future annual sustainability reports 6 17 October 2018 Annual General Meeting 2018

7 The political landscape Bringing energy prices down Delivering emissions reductions Transparency of pricing Reliability of supply 7 17 October 2018 Annual General Meeting 2018

8 Making energy more affordable for our customers Leading the transition to a clean energy future Creating the right culture Being a good community citizen Delivering for all shareholders 8 17 October 2018 Annual General Meeting 2018

9 Making energy more affordable for our customers Increased supply from Eraring and Pelican Point Flat or falling tariffs in NSW, QLD, SA and the ACT (having absorbed green scheme and network increases in NSW) No price rises for customers on hardship program since 2016 Special discounts for concession holders Launched online price comparison tool Savernator Usage Buster breaks down energy use by appliances Usage Buster 9 17 October 2018 Annual General Meeting 2018

10 Leading the transition to a clean energy future Origin s five pillars of decarbonisation: 1. Exit coal-fired generation by Significantly grow renewables in our portfolio 3. Utilise our strong gas position as a lower-emissions firming fuel 4. Empower customers with cleaner, smarter energy solutions 5. Demonstrate leadership in climate change advocacy

11 Creating the right culture Achieved our lowest ever TRIFR Improved our engagement score Introduced a new purpose and values Diversity and equal pay I m genuinely excited that we are moving forward towards a more sustainable energy future. Sally Bell Origin Portfolio Manager, Sydney October 2018 Annual General Meeting 2018

12 Our new purpose and values Getting energy right for our customers, communities and planet Work as one team, one Origin Be the customer champion Care about our impact Find a better way Being accountable October 2018 Annual General Meeting 2018

13 Being a good community citizen $23 million to support communities since 2010 The Foundation s focus, chosen by Origin employees, is to support education programs for disadvantaged youth In FY2018, employees volunteered more than 8000 hours and donated $340,000, matched by the Foundation GoodCompany ranked Origin second in its Top 40 Workplaces to Give Back survey Great education opportunities for disadvantaged rural students For a long time, I was ashamed of my upbringing. But I loved my teachers. I had so much going on at home, and to have someone to talk to at home made me feel safe. Ashley Nielsen, above, is studying to become a teacher with the support of Origin Foundation October 2018 Chairman's Address

14 FY2018 highlights Share price growth in FY2018 Medium-term outlook supports recommencement of dividends in FY2019, subject to Board approval and no material adverse change in business conditions Statutory Profit Underlying Profit (continuing operations) Adjusted Net Debt $218 million $838 million $6.5 billion October 2018 Annual General Meeting 2018

15 CEO s address Frank Calabria 17 October 2018

16 Outline 1. Good energy 2. Energy Markets performance 3. Addressing affordability 4. Integrated Gas performance 5. Contributing to policy outcomes 6. Outlook October 2018 Annual General Meeting 2018

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18 Generation and gas sales lifted Energy Markets earnings Underlying earnings increased to $1.8 billion driven by: 14% lift in output from Eraring Higher wholesale prices 13% increase in natural gas sales October 2018 Annual General Meeting 2018

19 Addressing affordability Customer pic Increased supply from power stations putting downward pressure on wholesale prices Secured more gas for the domestic market Rapid rollout of renewables to 2020 Led industry on flat or falling tariffs in NSW, ACT, Queensland and South Australia from 1 July No price rises for hardship customers since October 2018 Annual General Meeting 2018

20 Making energy easier and simpler for customers Increasing digital interactions New products and services Online sales up 28% My Account & Mobile App unique visits up 54% Technology pipeline 345k 1,822k 270k 1,186k Visibility and control Reducing energy cost Usage Buster Home HQ Savernator FY17 FY18 FY17 FY18 My Account Demand Response Solar products October 2018 Annual General Meeting 2018

21 Increased contribution from Australia Pacific LNG Earnings up 67%, driven by: Recovery in commodity prices Record production Net cash flows back to Origin of $363 million 125 LNG cargoes shipped Supplies close to 30% of east coast gas market Progress on plans to be a low cost, globally competitive gas producer Growth in reserves October 2018 Annual General Meeting 2018

22 Growth opportunities Entered Front End Engineering and Design (FEED) at Ironbark Preparing to get back on the ground in the highly prospective Beetaloo Basin in October 2018 Annual General Meeting 2018

23 Contributing to policy outcomes Affordability must be addressed across the supply chain to deliver sustainable reduction in prices Many of the 56 ACCC report recommendations provide a blueprint for achieving lower prices: Banning unanchored discounts and quoting in dollar-terms Making conditional discounts cost-reflective Phasing out the SRES Writing down network assets A true reference price could help consumers by improving transparency We do not support price regulation in the form of a default market offer October 2018 Annual General Meeting 2018

24 FY2019 guidance reaffirmed Provided that market conditions and the regulatory and political environment do not materially change to adversely impact operations: Origin expects Underlying Profit to be higher and further debt reduction in FY2019 Energy Markets Underlying EBITDA of $1,500-1,600 million APLNG (100%) Production range of PJ operated wells drilled Targeting operating breakeven of US$22-26/boe 1 and distribution breakeven of US$39-44/boe 1 1 AUD/USD: 0.75 Corporate/Other Costs of $60-65 million Capital expenditure (ex-aplng) of $ million LNG hedging cost of $75-85 million 1 at current market prices Oil hedging cost of $145 million 1 (including premiums of $34 million) at an average lagged oil price above US$75/bbl and above October 2018 Annual General Meeting 2018

25 2018 AGM Proxy Summary as at Proxy Close Resolution For Against Abstain* Proxy's Discretion 2. Re-election of Mr John Akehurst 1,034,206, % 20,742, % 3,860,129 10,035, % 3. Re-election of Mr Scott Perkins 1,022,458, % 32,417, % 3,878,984 10,088, % 4. Re-election of Mr Steven Sargent 1,038,193, % 16,743, % 3,827,038 10,079, % 5. Remuneration Report 984,872, % 68,590, % 5,581,534 9,766, % 6. Equity grants to Mr Frank Calabria 1,022,689, % 31,619, % 5,023,533 9,506, % 7. Potential Termination Benefits 1,029,422, % 22,426, % 5,899,905 11,057, % 8. Non-executive Director Share Plan 1,034,376, % 17,774, % 5,706,952 10,982, % 9.(a) Amendment to the Constitution 93,509, % 859,694, % 105,451,583 10,188, % 9.(b) Contingent resolution Free, Prior and Informed Consent 9.(c) Contingent resolution interim emissions targets 9.(d) Contingent resolution public policy advocacy on climate change and energy by Relevant Industry Associations 76,210, % 888,167, % 63,070,680 21,395, % 119,494, % 869,499, % 58,527,049 21,322, % 469,791, % 523,356, % 54,561,486 21,134, % *votes by a person who abstains on an item are not counted in calculating the required majority on a poll October 2018 Annual General Meeting 2018

26 2018 Annual General Meeting 17 October 2018