MIC - Macquarie
Transcription
MIC - Macquarie
MIC August 2016 I Important t t Notice N ti This presentation by Macquarie Infrastructure Corporation (MIC) is proprietary and all rights are reserved. Any reproduction, in whole or in part, without the prior written consent of MIC is prohibited. This presentation is based on information generally available to the public and does not contain any material, non-public information. The presentation has been prepared solely for information purposes, it is not a solicitation of any offer to buy or sell any security or instrument. This p presentation contains forward-looking g statements. Forward-looking g statements in this p presentation are subject j to a number of risks and uncertainties, some of which are beyond our control. Our actual results, performance, prospects or opportunities could differ materially from those expressed in or implied by the forward-looking statements. A description of known risks that could cause our actual results to differ appears under the caption “Risk Factors” in our Form 10-K, filed on February 23, 2016. Additional risks of which we are not currently aware could also cause our actual results to differ. Th These f forward-looking d l ki statements t t t are made d as off the th date d t off this thi presentation. t ti W undertake We d t k no obligation bli ti t publicly to bli l update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law. MIC is not an authorized deposit-taking institution for the purposes of the Banking Act 1959 (Commonwealth of Australia) and its obligations do not represent deposits or other liabilities of Macquarie Bank Limited ABN 46 008 583 542. Macquarie Bank Limited does not guarantee or otherwise provide assurance in respect of the obligations of MIC. This presentation discusses historical performance and results which may not be indicative of future performance. PAGE 2 MIC – Company C O Overview i What does it own? MIC owns and operates a diversified group of businesses that provide essential services to businesses and individuals primarily in the United States MIC 100% International-Matex Tank Terminals 100% Atlantic Aviation Controlling/100% Contracted Power and Energy 100% Hawaii Gas PAGE 3 MIC - Investment I t t Thesis Th i Why invest in MIC? MIC offers investors an attractive Total Return investment opportunity • 6.3% yield1 • Potential cash flow growth of 10%-15% 10% 15% per annum • Total return of 15.8% p.a. since MIC’s IPO on December 15, 20042 Attractive business characteristics support strong and stable cash generation • High-value g a ue p physical ys ca assets, p preferred e e ed market a et pos positions, t o s, high g ba barriers e s to e entry, t y, inflation at o p protection otect o Diversified business portfolio • Opportunity to deploy $250 - $350 million per year in expansion projects and bolt-on M&A provides a p platform for the deployment p y of additional capital p • Each business p • No need for external financing Strong credit profile • Rated BBB• ~$1.1 billion of available credit capacity • Weighted average debt maturity of 6.5 years3 1. 2. 3. As of August 3 , 2016. Based on a declared quarterly dividend of $1.25/share ($5.00/share annualized) At August 1, 2016. Assumes dividends reinvested. Past performance is not indicative of future results. Source: MSCI. As of August 1, 2016 PAGE 4 MIC - Cash C h Fl Flow G Growth th E Engine i 75%-85% %8 % Organic G Growth th Cash Flow Cas o Dividends de ds 15%-25% Incremental Cash Flow Growth Capex and M&A Total potential growth in annual cash flow of 10%-15% PAGE 5 MIC – Component C t Growth G th1 The sources of annual growth in cash flow are clear Organic growth in cash flow, portfolio wide 3% - 5% Implementation of shared services and operating initiatives 2% - 3% Deployment of growth capital with returns comparable to historical norms 4% - 6% Optimization O ti i ti off capital it l structure t t 1% - 1% Total potential growth in annual cash flow 1. 10% - 15% Past performance is not necessarily indicative of future results PAGE 6 MIC - Dividend Di id d Hi History t Dividend Growth Annualized dividend growth of 12.6% since 2Q’131 Targeting 12%-14% year-on-year dividend growth in 20162 $1 40 $1.40 $1.25 $1.20 $1 00 $1.00 $0.875 $0.80 $0.60 $0.40 $0.20 $0.00 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 1. 2. Reflects the quarter during which the company resumed a normalized dividend payout following the successful refinancing of Atlantic Aviation’s credit facilities. Past performance is not necessarily indicative of future results. Subject to the continued stable performance of MIC’s businesses, no material deterioration in the condition of the broader U.S. economy, and authorization of the Company’s Board of Directors. PAGE 7 MIC – Debt D bt P Profile fil MIC Debt Profile Overview1 MIC’ MIC’s businesses b i are individually i di id ll capitalized it li d MIC is rated BBB Proportionately combined leverage ratio2 of 4.23x, and 4.10x excluding standalone project-finance style debt at MIC’s MIC s Renewable assets $1.1 billion of undrawn revolving credit facility capacity across its businesses and MIC Corporate Weighted g average g maturity y of 6.5 yyears1 MIC IMTT • • • 1. 2. 3. $600MM Senior Unsecured Revolver ($20MM Drawn) $600MM Unsecured Senior Notes $509MM Unsecured tax-exempt bonds Atlantic Aviation • • $70MM Senior Secured Revolver (Undrawn) $597MM Senior Secured Term Loan • • $350MM Convertible Notes $410MM Secured Revolver ($20MM drawn) Contracted Power and Energy BEC • • $25MM Senior Secured Revolver (Undrawn) $266MM Senior Secured Term Loan Renewable • Hawaii Gas • $208MM of term debt3 • • $60MM Senior Secured Revolver (Undrawn) $100MM Senior Secured Notes $80MM Term Loan Balances are as of August 1, 2016 Net Debt/EBITDA as of June 30, 2016 Includes MIC’s proportionate interest in its solar and wind power businesses within the Contracted Power and Energy segment. PAGE 8 MIC – Organization O i ti Chart Ch t How is MIC organized? MIC is externally managed by an affiliate of the Macquarie Group Board comprises six directors, five of whom are independent under the rules of the NYSE Macquarie Group Limited ted (ASX: MQG) Public ub c Shareholders S a e o de s 8.6%1 Management Services Agreement 1. 2. 91.4%2 MIC (NYSE: MIC) As of August 1, 2016 Includes directors and officers ownership of an aggregate ~0.3% as of August 1, 2016 PAGE 9 MIC - IMTT What does it own? One of the largest independent providers of bulk liquid terminal services in the U.S. Total storage capacity of 45.1 million barrels Stores and handles refined petroleum products, chemicals, vegetable and animal oils ~80% of revenue from take-or-pay type contracts1 Barriers to entry include limited suitable waterfront land, regulatory and environmental restrictions, and high upfront capital costs Chemical 23% Renewable/Veg & Animal Oil 6% Refined Petroleum Product 55% Crude Oil & Asphalt 3% Storage Capacity & Utilization3 Capacity (mmbb bls) Storage C Revenue by Product & Service Type1 46.0 45.0 44 0 44.0 43.0 42.0 41.0 40.0 39.0 38.0 37.0 36.0 94% 94% 94% 94% 94% 94% 93% 92%95% 96% 95% 90% 85% 80% 75% Capacity Utilization (% %) 70% Other 2 13% 1. 2. 3. For the year ended December 31, 2015 Storage Includes 8% of revenues from spill response activity 2013 and 2014 utilization levels reflect the impact of several large tanks being out of service for scheduled cleanings and inspections Capacity Capacity Utilization PAGE 10 MIC - IMTT IMTT St. St Rose R IMTT Bayonne B Facility F ilit PAGE 11 MIC - Atlantic Atl ti A Aviation i ti What does it own? Provides primarily fuel and fuel-related services to owners and operators of general aviation aircraft Operates at 69 airports subject to long-dated long dated lease concessions Passes through changes in underlying fuel costs to customers with a focus on maintaining, and ultimately growing, dollar-based margins well-suited suited for a roll roll-up up strategy Fragmented market structure is well Weighted Average Lease Life1 Geographic Footprint 20 19 Yea ars 19 18 17 19.6 19 4 19.4 17.9 19.5 18.8 17.8 17.6 16.8 16 15 2008 2009 2010 2011 2012 2013 2014 2015 2Q16 1. As of June 30, 2016. Includes extension options under Atlantic Aviation’s control. Atlantic Aviation calculates weighted average lease life based on EBITDA excluding non-cash items in the prior calendar year, adjusted for the impact of acquisitions and dispositions. PAGE 12 MIC - Contracted C t t d Power P and dE Energy What does it own? Controlling interests in five solar power facilities, two wind power facilities, and a 100% interest in a gas-fired power facility Electricity is sold to creditworthy off-takers, typically under multi-year contracts Renewable assets operate subject to long term power purchase agreements (PPAs) with initial average durations of 20-25 years Bayonne Energy Center (BEC) has contracted 62.5% of its capacity under a tolling arrangementt with ith a weighted i ht d average remaining i i lif life off 12 years Geographic Footprint Capacity Growth 900 800 700 BEC MW W 600 500 400 300 200 100 0 2012 Wind Solar 2013 2014 Current Gas PAGE 13 MIC – Contracted C t t d Power P and dE Energy B Bayonne E Energy C Center t S l Solar PAGE 14 MIC H Hawaiiii MIC Hawaii – What does the segment manage? Supplies synthetic natural gas and propane across Hawaii’s six main islands to ~68,000 customers Comprises a regulated gas utility and an unregulated LPG distribution business Products are used in a wide range of commercial and residential applications Received regulatory approval to replace 30% of its synthetic natural gas with LNG The 7 MW Waihonu solar facility, y, located on Oahu,, was placed p into service in mid-2016 Gas Volumes1 Geographic Footprint Kauai Utility and Non-Utility Molokai & Lanai Utility and Non-Utility Maui Utility and Non-Utility therms Oahu Headquarters SNG Manufacturing Plant Utility and Non-Utility 7MW Solar Facility Hawaii Utility and Non-Utility Solar 1. 2008 2009 2010 2011 2012 2013 2014 2015 Reflects utility and non-utility volumes PAGE 15 MIC – Growth G th Initiatives I iti ti Capital deployment opportunities Targeting $350 million per year of growth capital deployment Storage capacity and ancillary infrastructure at IMTT, hangars at Atlantic Aviation, and LNG infrastructure at Hawaii Gas BEC II: an incremental 130 MW of generation capacity on land immediately adjacent to the existing BEC facility Bolt-on M&A: acquisitions within our existing verticals (i.e. additional FBOs and renewable generation facilities) $500 $450 $470 $100 Approved Project Backlog1 $400 $130 $MM $350 $300 $250 $240 $200 $150 $100 $50 $0 G Growth th Projects P j t (ex. ( BEC II) BEC II B lt on M&A Bolt 2 T t l Total 1 1. 2. As of August 1, 2016. For BEC II, forecast spending of approximately $32 million in 2016, $82 million in 2017, and $16 million in 2018 MIC has invested $26.5 million in bolt-on M&A transactions through the quarter ended June 30, 2016. In the year ended December 31, 2015, MIC invested a total of $266.9 million in acquisitions, including $209.0 million in BEC II. PAGE 16 C t t d Power Contracted P & Energy E – Growth G th Initiatives I iti ti MIC is pursuing several CP&E initiatives within IMTT’s footprint in Bayonne, NJ Spectra TETLP Pipeline (approx.) Transco Bayonne Pipeline (approx.) New BEC lateral via IMTT (approx.) 130 MW BEC Expansion Site Co-gen facility on IMTT land currently leased to thirdparty Bayonne Energy Center © 2015 Google All property lines are approximate and indicative only PAGE 17 C t t d Power Contracted P & Energy E – Growth G th Initiatives I iti ti An additional opportunity for power development exists in Chesapeake, VA Former Coal Plant (~800MW retired in Jan 2015) 230kV substation Colonial Pipeline PAGE 18 Atl ti A Atlantic Aviation i ti – Hangar H Additi Additions Atlantic Aviation recently opened the doors to a new 37,000 ft2 hangar at LAX • The facility is capable of handling some of the largest business jets in the market today • High demand resulted in the hangar’s capacity being sold out three years in advance PAGE 19 MIC Contact for additional information J D Jay Davis i Mike Hacke Managing Director Manager 125 W. 55th Street, Level 15 125 W. 55th Street, Level 15 New York, NY 10019 New York, NY 10019 +1 (212) 231-1825 +1 (212) 231-6483 [email protected] [email protected] PAGE 20