Investor Presentation Our vision: A leading Norwegian renewable - PowerPoint PPT Presentation

April 12, 2019 Investor Presentation

Our vision: A leading Norwegian renewable energy group

Agder Energi in brief Vertically integrated utility company Fourth largest supplier of hydro power – mean production of 8.1 TWh Fourth largest network company – 202 000 customers Leading market share in retail power sales – appox. 14 TWh in end user sales Underlying operating revenues approximately NOK 15 bn Government owned – 54.5 % by Agder municipalities and 45.5 % by Statkraft Headquarter in Kristiansand, Norway, 1 005 employees

Key credit strengths Strong market position Low cost profile and flexible producer of hydro power Monopoly position through operation of distribution grids in the Agder Counties Strong cash flow High share of price hedging next 3-5 years, robust hedge the following 10 years due to long term power sales contracts Stable and considerable cash flow from monopoly business Investment flexibility Optionality in existing project portfolio Strong and stable ownership structure 30 coordinated municipalities and Statkraft (A-), which is 100 % owned by the Norwegian state (AAA)

Core business activites Hydro Power Network Build and operate Build and operate hydro power stations distribution network Market Energy Management LOS: Private end user sales Maximising profit of the Otera Ratel: Infra structure hydro power portfolio, contractor business retail sales in the Varme: District heating and cooling Nordics and Germay

Group structure Tom Nysted CEO Pernille K. Gulowsen FINANCE AND RISK MANAGEMENT Board of directors Unni Farestveit NETWORK CSR AND CORPORATE DEVELOPMENT Svein A. Folgerø Jan T. Tønnessen Steffen Syvertsen Anders Gaudestad Frank Håland NETWORK HYDROELECTRIC POWER ENERGY MANAGEMENT MARKET SHARED SERVICES AE Kraftforvaltning LOS AE Fleksibilitet Entelios Nordic Otera Ratel Enfo AE Varme Entelios Europe Nordgröön AE Venture

Hydro power with high flexibility River system Mean production Reservoir capacity 9 100 9 000 8 900 8 800 8 700 ( TWh/year) (TWh) Otra 3.6 2.7 Mandal 1.7 0.5 Production GWh Arendal 1.3 0.7 Sira-Kvina 0.8 0.7 Ulla-Førre 0.3 0.5 Andre 0.4 0.1 Sum 8.1 5.3 2014 2015 2016 2017 2018

Sole network owner in Agder Agder Energi Nett owns and operates the regulated transmission and distribution • networks in Aust-Agder and Vest-Agder Stable and considerable cash flow • Smart metering (AMS) in full operation • Network capital NOK 5 083 mill •

Strategic goals toward 2020 Results and value creation best in industry 20% improved profitability in existing business Develop business models and positions related to digitalization and new energy markets

Focus areas Optimizing existing business activities Positioning to offer scalable hydro power capacity Market operations posisitioning for future energy markets with flexibility and effect Posistioning for future network business Energy solutions to private consumers

Investments 6 % Planned investments cirka NOK 1 030 mill per year on average in the 5 year period, of which NOK 440 mill per year is comitted and government imposed. After 2021 back to reinvestment level 49 % The next few years a high degree of customer 45 % initiated projects with the network business Investment flexibility within the hydro power project portfolio Hydro Network Other

Investments 2018-2020 Largest projects Project cost Completion (ca, NOK mill) Hydro power Skjerka generator 300 2019 Hydro power Åseral Nord 870 2020 Hydro power Planned projects 340 2021

Dividend policy Indicative dividend ratio 70% based on the Group’s net income to majority according to underlying IFRS previous year Significant nonrecurring sales gains or losses may be considered to be excluded from the dividend calculation. No dividend floor The revised dividend policy applies for the years 2018-2020

Financial update

Highlights 2018 Profit from operations NOK 2 957 mill (NOK 2 597 mill) in underlying EBITDA Investments NOK 1 583 mill (NOK 1 516 mill), of which NOK 92 mill (NOK 99 mill) of investments within network paid by customers Other activities 51 % of shares in Otera Infra was sold to Roadworks in May, closing in August In June, Agder Energi sold the Honna transmission substation in Åseral to Statnett HMS Low and stable sickness absence of 3,6%

Reservoir levels NO2 100% 80% % of normal 60% 40% 20% 0% 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 2019 2018 10 yrs average

Power prices NO2 70 60 50 Øre/KWh 40 30 20 10 0 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 Forward price 2019 Spot price 2019 Spot price 2018

Revenues and EBITDA per segment Revenues (NOK mill) EBITDA (NOK mill) 16 000 3 500 1 588 14 000 3 000 2 679 2 520 12 000 2 440 2 500 2 194 10 000 2 000 8 000 1 500 6 000 1 000 4 000 500 2 000 0 2014 2015 2016* 2017* 2018* 0 -500 2014 2015 2016* 2017* 2018* Hydro Network Market Energy Mgt Hydro Network Market Energy Mgt * Reorganization, Energy Management from 2016

Solid cash flow providing financial strength Cash Flow (NOK mill) FFO*/Net Debt 25% 2 500 22,90 % 22,40 % 2 049 2 000 1 779 19,40 % 20% 18,40 % 1 502 1 500 1 189 1 000 15% 500 10% 0 -500 5% -1 000 0% -1 500 2015 2016 2017 2018 2015 2016 2017 2018 FFO*/Net Debt Operational CF Net investments Dividends *Unadjusted, adjustments are made in rating. Interest bearing debt on 4 quarters rolling basis

Robust funding structure and diverse maturity profile Funding sources Maturity profile (NOK mill) 1 600 5% 5% 1 400 1 200 8% 1 000 800 53% 600 29% 400 200 - 2019 2021 2023 2025 2027 2028+ Bonds EUR Loans Green Bonds CP Schuldschein Bonds EUR Loans Green Bonds CP Schuldschein Unutilized credit facilities NOK 1 500 mill to support short term funding and refinancing risk, overdraft facility NOK 1 000 mill for operational liquidity and Nasdaq cash requirement

Scope credit rating affirmed Aug-18 Vertically integrated business model with monopolistic power distribution, strong position of hydro power generation in the merit system and leading retail sales business Profitable and environmentally-friendly hydro power production with substantial hedging agreements and sizeable reservoir capacity Long-term, committed majority owners that are jointly organized and show ability and willingness for potential parent support

God kraft. Godt klima.

Agder Energi: God kraft-godt klima