2017 FULL YEAR RESULTS Full year ended 30 June 2017 Frank Calabria - PowerPoint PPT Presentation

2017 FULL YEAR RESULTS Full year ended 30 June 2017 Frank Calabria CEO, Lawrie Tremaine CFO 16 August 2017 Origin Energy | 2017 Full Year Results Announcement 1

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 report reflect views held only at the date of this report. 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. Origin Energy | 2017 Full Year Results Announcement 2

Outline Performance Highlights Frank Calabria Financial Review Lawrie Tremaine Operational Review Frank Calabria Outlook Frank Calabria Appendix Origin Energy | 2017 Full Year Results Announcement 3

PERFORMANCE HIGHLIGHTS Frank Calabria Origin Energy | 2017 Full Year Results Announcement 4

2017 Full Year Highlights Statutory Loss Underlying EBITDA Underlying Profit $(2,226) million $2,530 million $550 million (126.9) cps 31.3 cps Including impairments of $3,064 Up $834 million on FY2016 Up $185 million on FY2016 million after tax NCOIA Adjusted Net Debt TRIFR $1,378 million $8.1 billion 3.2 up $163 million on FY2016 Down $1.0 billion on FY2016 Down from 4.2 in FY2016 Origin Energy | 2017 Full Year Results Announcement 5

Good progress against key priorities REDUCING DEBT AND LEADERSHIP IN LEADERSHIP IN IMPROVING RETURNS ENERGY MARKETS INTEGRATED GAS  186% increase in EBITDA to $1,104m  12% increase in EBITDA to $1,492m  Adjusted Net Debt reduced to $8.1 billion  40% increase in production  Improvement in customer satisfaction (interaction NPS up 4 points to +16)  Underlying ROCE improved to  APLNG train 2 online 6.0% Improvement in electricity and gas   Completed operational phase of APLNG  $1.2 billion reduction in capital spend 90-day two- train lenders’ test  1,200 MW increase in committed renewable energy supply  $1 billion of asset sales completed  Halladale/Speculant online  Accelerating digital transformation and Progressing sale of Lattice Energy   Announced contingent resource and future energy solutions increased interest in prospective Beetaloo joint venture to 70% TRANSFORMING CULTURE  New executive leadership team in place  Employee engagement score increase to 58% from 53% in FY2016  Improved safety performance (TRIFR reduced to 3.2 from 4.2 in FY2016) Origin Energy | 2017 Full Year Results Announcement 6

Asset sales reducing debt Assets sales completed NCOIA $m Asset Proceeds (A$m) 1,400 Mortlake Pipeline 245 1,378 1,350 Mortlake Terminal Station 110 1,300 Cullerin Range Wind Farm 72 International renewable assets 50 1,250 Upstream assets 16 1,200 1,215 Darling Downs Solar Farm 10 Stockyard Hill Wind Farm 110 1,150 Darling Downs Pipeline 392 1,100 Total proceeds 1,005 FY2016 FY2017 • Exceeded $800 million target • Assets sold at an average 15x EBITDA Origin Energy | 2017 Full Year Results Announcement 7

Lattice IPO / trade sale progressing well, expected by end of CY17  Established Lattice as a stand-alone entity  Established Lattice management team  Completed IPO non-deal roadshow  Received indicative trade sale bids  Launched bank facility process Origin Energy | 2017 Full Year Results Announcement 8

Strong gas position underpins volume growth and sustainable earnings Energy Markets East Coast Gas Supply Portfolio • PJ/a Strong gas position with length beyond 300 2022 and flexible transport underpins Increased gas sales volumes in o 250 FY2017 200 Support for customers and energy o security 150  Signed 760 domestic customer 100 agreements during FY2017 50  Gas supply agreements with To be contracted post Lattice Energy Engie bringing 240 MW gas- - divestment 1 fired generation back online in 2016 2017 2018 2019 2020 2021 2022 SA in FY2018 Financial Year • Targeting FEED on Ironbark during Ironbark Other Purchases (Price Review) FY2018 Other Purchase (Oil Linked) Other Purchase (Fixed Price) APLNG purchases Origin's existing equity gas (1) Lattice Energy does not sell all gas production to the Energy Markets business. During FY2017 Lattice Energy gas sales (including ethane) totalled 82.5 PJe of which 51.9 PJe were sold to Energy Markets Origin Energy | 2017 Full Year Results Announcement 9

Electricity portfolio supporting earnings as energy markets transition Electricity spot / forward prices $/MWh Electricity Portfolio 160 • Delivers improved returns in a period of high 140 wholesale prices 120 • Supports earnings as wholesale prices ease with the addition of low cost renewable energy 100 supply from 2H FY2018 80 • Resilience in a carbon constrained world with 60 growing renewable position, strong gas position to support renewables and minimal 40 risk of stranded assets NSW QLD SA VIC 20 spot prices forward prices 0 Jun-16 Jan-17 FY2018 FY2019 FY2020 High prices driven by coal Increasing renewables withdrawals, high gas prices and expected to ease prices energy policy uncertainty Origin Energy | 2017 Full Year Results Announcement 10

Increased generation output in response to high wholesale prices Monthly Generation Output GWh 1,800 • Eraring capacity utilisation at 64% in 2H FY2017 1,600 • Eraring coal contracting and supply chain enhanced 1,400 and optimised to support increased generation output 1,200 1 in 20 year maintenance Diversified coal supply o outage 1,000 Well progressed coal contracting program to o 800 supplement long term contracts 600 o FY2018 output expected to be up 5-10% on 400 FY2017 levels to 14.6 - 15.3 TWh 200 • FY2016 FY2017 Gas generation provides firming capacity 0 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Agreement with Engie to add to energy output in o SA from FY2018 Eraring (GWh) Gas (GWh) Avg output Origin Energy | 2017 Full Year Results Announcement 11

Accelerating transition to low cost renewables Origin Installed Renewable Capacity Bundled PPA Prices 1 (Large scale wind and solar) $/MWh MW 2,000 160 1,800 530 1,868 1,600 120 1,400 110 1,200 496 1,000 80 800 732 600 40 400 Renewables are the lowest cost new build generation today 200 0 0 at June FY2018 FY2019 FY2020 at June FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 2017 2020 • • Additional attractively priced renewable supply to During 2H FY2017 Origin announced sale of commence from 2H FY2018 Stockyard Hill for $110 million with market leading PPA price of below $60/MWh (1) Origin and publicly released third party data Origin Energy | 2017 Full Year Results Announcement 12

Transforming customer experience and automating processes through digital A CHOICE OF CHANNELS Simplified Experiences Social, → Increase customer Mobile Voice - Personalised Chat Bot - Effortless satisfaction Simple, data-led and integrated → Improve customer Core Products propositions acquisition and Customer Propositions retention Predictable plan Solar Boost Fast & Easy Moves Fulfilment Automation Social + crowd sourcing → Improve productivity Secure, straight-through → Reduce operating Platform processing - Digitised processes costs Automated Foundation Data, Analytics Customer Core Billing Marketing / Capability & AI Centric Design Personalisation Origin Energy | 2017 Full Year Results Announcement 13