APA GROUP — Interim / Quarterly Report 2019

Feb 19, 2019

financial results for half year ended 31 December 2018.

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20 February 2019

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disclaimer

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This presentation has been prepared by Australian Pipeline Limited (ACN 091 344 704) as responsible entity of the Australian Pipeline Trust (ARSN 091 678 778) and APT Investment Trust (ARSN 115 585 441) (APA Group).

The information in this presentation does not contain all the information which a prospective investor may require in evaluating a possible investment in APA Group and should be read in conjunction with the APA Group’s other periodic and continuous disclosure announcements which are available at www.apa.com.au. All references to dollars, cents or ‘$’ in this presentation are to Australian currency, unless otherwise stated.

Not financial product advice: Please note that Australian Pipeline Limited is not licensed to provide financial product advice in relation to securities in the APA Group. This presentation is for information purposes only and is not financial product or investment advice or a recommendation to acquire APA Group securities and has been prepared without taking into account the objectives, financial situation or needs of individuals. Before making an investment decision, prospective investors should consider the appropriateness of the information having regard to their own objectives, financial situation and needs and seek professional advice if necessary. Past performance: Past performance information should not be relied upon as (and is not) an indication of future performance.

Forward looking statements: This presentation contains certain forward looking information, including about APA Group, which is subject to risk factors. “Forward-looking statements” may include indications of, and guidance on, future earnings and financial position and performance. Forward-looking statements can generally be identified by the use of forward-looking words such as, 'expect', 'anticipate', 'likely', 'intend', 'could', 'may', 'predict', 'plan', 'propose', 'will', 'believe', 'forecast', 'estimate', 'target', 'outlook', 'guidance' and other similar expressions and include, but are not limited to, forecast EBIT and EBITDA, operating cash flow, distribution guidance and estimated asset life.

APA Group believes that there are reasonable grounds for these forward looking statements and due care and attention have been used in preparing this presentation. However, the forward looking statements, opinions and estimates provided in this presentation are based on assumptions and contingencies which are subject to change without notice, as are statements about market and industry trends, which are based on interpretations of current market conditions and are subject to risk factors associated with the industries in which APA Group operates. Forward-looking statements, opinions and estimates are not guarantees or predictions of future performance and involve known and unknown risks and uncertainties and other factors, many of which are beyond the control of APA Group, and may involve significant elements of subjective judgement and assumptions as to future events which may or may not be correct. There can be no assurance that actual outcomes will not materially differ from these forward-looking statements, opinions and estimates. A number of important factors could cause actual results or performance to differ materially from such forward-looking statements, opinions and estimates.

Investors should form their own views as to these matters and any assumptions on which any forward-looking statements are based. APA Group assumes no obligation to update or revise such information to reflect any change in expectations or assumptions.

Investment risk: An investment in securities in APA Group is subject to investment and other known and unknown risks, some of which are beyond the control of APA Group. APA Group does not guarantee any particular rate of return or the performance of APA Group.

Non-IFRS financial measures: APA Group results are reported under International Financial Reporting Standards (IFRS). However, investors should be aware that this presentation includes certain financial measures that are non-IFRS financial measures for the purposes of providing a more comprehensive understanding of the performance of the APA Group. These non-IFRS financial measures include EBIT, EBITDA and other “normalised” measures. Such non-IFRS information is unaudited, however the numbers have been extracted from the audited financial statements.

Not an offer: This presentation does not constitute an offer, invitation or recommendation to subscribe for or purchase any security. In particular, this presentation does not constitute an offer to sell, or a solicitation of an offer to buy, any securities in the United States. Securities may not be offered or sold, directly or indirectly, in the United States or to persons that are acting for the account or benefit of persons in the United States, unless they have been registered under the U.S. Securities Act of 1933, as amended (the U.S. Securities Act), or are offered and sold in a transaction exempt from, or not subject to, the registration requirements of the U.S. Securities Act and any other applicable state securities laws.

Non-GAAP financial measures: Investors should be aware that certain financial data included in this presentation are "non-GAAP financial measures" under Regulation G of the U.S. Securities Exchange Act of 1934, as amended. These measures are EBITDA, normalised EBITDA and statutory EBITDA. The disclosure of such non-GAAP financial measures in the manner included in the presentation may not be permissible in a registration statement under the U.S. Securities Act. These non-GAAP financial measures do not have a standardised meaning prescribed by Australian Accounting Standards and therefore may not be comparable to similarly titled measures presented by other entities, and should not be construed as an alternative to other financial measures determined in accordance with Australian Accounting Standards. Although APA Group believes these non-GAAP financial measures provide useful information to users in measuring the financial performance and condition of its business, investors are cautioned not to place undue reliance on any non-GAAP financial measures included in this presentation.

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results overview and stratresults overview and gic highlights strategic highlights Mick McCormack Managing Director and CEO.

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1H FY2019 highlights

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$ million	1H FY19	1H FY18	change
Revenue excluding pass-through(1)	1,012.9	954.7	Up	6.1%
EBITDA	787.7	755.3	Up	4.3%
Net profit after tax	157.4	124.0	Up	27.0%
Operating cash flow(2)	470.2	462.5	Up	1.7%
Operating cash flow per security (cents)	39.8	41.4(3)	Down	3.9%
Distributions per security (cents)	21.5	21.0	Up	2.4%

Notes:

(1) Pass-through revenue is revenue on which no margin is earned.

(2) Operating cash flow = net cash from operations after interest and tax payments.

(3) Operating cash flow per security for 1H FY2018 has been adjusted for the Entitlement Offer completed on the 23 March 2018.

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results overview

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• Solid interim results delivered

New revenue generating assets

• On track to deliver FY2019 EBITDA within upper end of guidance range

• Growth capex spend on committed projects of $261.4m and on track to reach ~$425m for FY2019

• New revenues from new operating assets

• Pipelines and renewable power generation

EDSF photo

• Announced significant contracts and variations on the East Coast Grid that will generate $130m in new and renewed revenue over 3 years

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Darling Downs Solar Farm
Emu Downs Solar Farm
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• Western Australia portfolio growth

• Powering the resources sector

• Carpentaria Gas Pipeline now bi-directional supporting new gas flow from NT

• Refinanced high cost debt reducing borrowing costs

• Focus on the customer: APA’s Customer Promise and the industry’s Energy Charter

• Improved safety performance

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record capex program $1.4 b plus – nearing completion

FY2017 – FY2019

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Darwin
WPP
BGP
Yamarna Gas Pipeline & Reedy Creek Wallumbilla Pipeline
AGP
Gruyere Power Station
- commissioned May 18
- power station generating revenue early Q3 FY2019- gas pipeline commissioned FY2018PPS NGPTGP Northern Territory Mount Isa DPS & LPS X41 PS
Queensland
CGP
Gladstone
Western
Agnew Lateral GGP Australia WGP
BWP
- completion 2H FY2019 SWQP Wallumbilla RCWP Daandine PS & Kogan North GPP
MP AL GPS South DDSF Brisbane IOC
YGP Australia Moomba RBP
Tipton West GPP Directlink
MGPSF MMGP EGP
EDWSF MSP SouthNew
BWSF KKP Murrin Murrin Lateral EP Wales
CRP
Perth PGP Darling Downs Solar Farm
- expansion 2H FY2019 CWP
North Brown Hill
Wind Farm - commissioning Q3 FY2019
Mt Morgans Gas Pipeline Murraylink Sydney
Emu Downs Solar Farm Adelaide Victoria
- commissioned Jan 18 SGP
VTS
- commissioned Jan 18 SESA Dandenong
LNG Facility OGPP
MGP
Melbourne
Badgingarra Wind & Solar Farms
Orbost Gas Processing Plant
- wind farm generating revenue early Q3 FY2019
Tasmania - on spec gas from July 19
- solar farm on schedule to complete end April 19
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results overview and financial performance strategic highlights Peter Fredricson Chief Financial Officer.

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summary results

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$ million	1H FY19 1H FY18 Change
Revenue excluding pass-through(1)	1,012.9 954.7 6.1%
EBITDA Depreciation and amortisation	787.7 755.3 4.3% (297.6) (289.1) (2.9%)
EBIT Net interest expense	490.0 466.1 5.1% (239.6) (262.6) 8.8%
Pre-tax profit Tax	250.5 203.5 23.1% (93.1) (79.5) (17.0%)
Net profit after tax	157.4 124.0 27.0%
Operating cash flow(2)	470.2 462.5 1.7%
Operating cash flow per security (cents)	39.8 41.4(3) (3.9%)

Notes: Numbers in the table may not add due to rounding.

(1) Pass-through revenue is revenue on which no margin is earned.

(2) Operating cash flow = net cash from operations after interest and tax payments.

(3) Operating cash flow per security for 1H FY2018 has been adjusted for the Entitlement Offer completed on the 23 March 2018.

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1H FY19 result: EBITDA by business segment

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$ million	1H FY19	1H FY18	Change
Energy Infrastructure Queensland 511.6 474.0 7.9% New South Wales 75.4 71.8 5.0% Victoria & South Australia 68.8 71.5 (3.8%) Northern Territory 10.8 11.4 (5.1%) Western Australia 122.7 117.0 4.9%
Energy Infra total 789.4 745.8 5.8% Asset Management 27.7 25.9 6.9% Energy Investments 13.0 11.9 9.2% Corporate costs (42.4)(2) (28.3) (49.7%)(2)
Total EBITDA 787.7 755.3 4.3% CC/EBITDA(1) 5.1% 3.6%

Notes: Numbers in the table may not add due to rounding.

(1) As a % of EBITDA before corporate costs.

(2) Includes $11.3 million of costs associated with the CKI proposal and Managing Director’s impending retirement.

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1H FY19 EBITDA bridge

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Energy Infrastructure

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$820.0
$8.6 $(2.7) $1.1 $(14.1)(1)
$15.4 $(7.2) $1.8
$800.0
$787.7
$15.8
$780.0
$13.8
$760.0
$755.3
$740.0
$720.0
$700.0
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Notes:

(1) Includes $11.3 million of costs associated with the CKI proposal and Managing Director’s impending retirement.

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low risk business model

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• Solid risk management processes in place

• Continue to manage counterparty risks by:

• Diversification of customers and industry exposures

• Assessment of counterparty creditworthiness

• Entering into long term contracts to support major capital spend

• Revenue weighted average contract tenor remains in excess of 12 years

Energy Infrastructure revenue split

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By revenue type By customer industry
Flexible short term
Throughput charge & other services: 0.7%
variable revenue: 7.1% Other: 0.2%
Contracted fixed
revenue: 3.3%
Regulated
revenue: 9.4%
Capacity
charge
revenue: 79.3%
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By customer credit rating

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energy infrastructure contracting

Recontracting ongoing:

• Since the GMRG reforms (1 Aug 2017) were introduced, APA has entered into ~120 contracts or variations across all transmission pipelines

• Of the ~120 contracts, 30 relate to firm service contract renewal with existing customers

• No contracts have been referred to the arbitration process

Revenue certainty underpinned by LT contracts:

• Revenue weighted average contract term as at 31 Dec 2018 is in excess of 12 years

• Expansions and new infrastructure are underpinned by long term contracts

Contracting flexibility:

• APA offers flexible multi asset, multi service contracts across APA’s interconnected portfolio with ~60 receipt points and 170 delivery points nationally operated by APA’s integrated operations centre

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Number of renewed firm service contracts
20
15
10
5
0
FY18 1H FY19
13
12.5
12
11.5
11
FY17E FY18 FY19
Revenue Weighted Average Tenor
Years
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Notes:

FY17 estimate, FY18 onwards are based on the Gas Market Reform Group (GMRG) data.

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capital expenditure and investment cash flows

$ million	1H FY19	1H FY18
Growth capex			400 A$ m
Regulated – Victoria Non-regulated East Coast Grid	14.0 104.3	22.4 78.9	300		295.7		320.8	330.4	Acquisitions & other investment
Western Australia and Northern Territory Other	132.6 10.5	120.1 24.3	200			162.7			Growth capex
Total growth capex Investments & acquisitions	261.4 -	245.7 20.0	100						SIB capex
Stay-in business capex	68.9	55.1
Total capital & investment expenditure(1)	330.4	320.8	0		1H FY16	1H FY17	1H FY18	1H FY19

Notes: Numbers in the table may not add due to rounding.

Notes: Value of acquisitions represents value of acquisitions as prescribed in the notes to the financial statements.

• (1) Capital expenditure (“capex”) represents cash payments as disclosed in the cash flow statement.

• Yamarna Gas Pipeline and Gruyere Power Station

• Murrin Murrin Lateral expansion

• Orbost Gas Processing Plant

Growth capex projects:

• Renewable power - Badgingarra Wind and Solar Farms and Darling Downs Solar Farm

• Scoping works for the Western Outer Ring Main project in VIC and smaller capacity expansions and metering works in VIC and NSW

• Crib Point Pakenham Pipeline - early investigative works

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|||||||||
|---|---|---|---|---|---|---|---|
|3 year growth projects update|
|Project (% spent)|Pipeline projects|Renewables projects|Midstream projects|
|Projects|FY17|FY18|1H FY19|2H FY19|1H FY20|2H FY20|Customer|
|Emu Downs Solar Farm|100%|13-year contract|Synergy|
|(incl. $5.5m ARENA funding)|
|Reedy Creek Wallumbilla|
|100%|20-year contract|APLNG|
|Pipeline|
|Yamarna Gas Pipeline &|Gold Road/|
|96%|15-year contract|
|Gruyere Power Station|Gold Fields JV|
|Darling Downs Solar Farm|
|91%|12-year contract|Origin|
|(incl. $20m ARENA funding)|
|Wind farm 93%|
|Badgingarra Wind & Solar Farm|17-year contract|Alinta|
|Solar farm 72%|
|Cooper|
|Orbost Gas Processing Plant|75%|Multi year contract|
|Energy|
|Other Projects|Various|
|Total growth capex|FY17|FY18|FY19|FY20|
|(in-flight to date)|$272m|$743m|~$425m|~$300-400m|
|FY17|FY18|FY19 ~$100m+|
|Stay-in business capex|
|$69m|$113m|(1H FY19 $69m*)|
|FY18|FY19|FY20|
|Total revenue contribution|
|<$5m|~$70m|~$215m+|

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Notes: diagram is illustrative only * Revenue generating during 1H FY19 ** Actual for 1H FY19

capital management

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• Cash and committed undrawn facilities of around $1,220 million as at 31 December 2018 to meet the continuing needs of the business

• Credit ratings: S&P BBB (outlook Stable, confirmed Nov 2018), Moody’s Baa2 (outlook Stable, confirmed Nov 2018)

• Key capital ratios are as follows:

Metrics(1)	Dec 2018	Jun 2018	Jun 2017
Gearing(1, 2) 66.5% 65.4% 67.4% Interest cover ratio 2.8 times 2.7 times 2.8 times Average interest rate applying to drawn debt(1) 5.49% 5.65% 5.56% Interest rate exposure fixed or hedged 95.0% 97.7% 94.5% Average maturity of senior facilities 6.4 years 6.9 years 7.5 years

Notes:

• (1) For the purpose of the calculation, drawn debt that has been kept in USD (rather than AUD) and is in a designated hedge relationship with USD revenue, has been nominally exchanged at AUD/USD exchange rates of 0.7772 for Euro and GBP MTN issuances and 0.7879 for the US144A notes at respective inception dates.

• (2) Ratio of net debt to net debt plus book equity.

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debt maturity profile

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APA maintains diversity of funding sources and spread of maturities[(1)]

$1,600m Headroom (bank borrowings) $1,400m Bank borrowings $1,200m Sterling MTN Euro MTN $1,000m US 144A Notes $800m Canadian MTN $600m Australian MTN US Private Placement Notes $400m USD denominated obligations[(2)] $200m $0m

Notes:

(1) APA debt maturity profile as at 31 December 2017.

(2) USD denominated obligations translated to AUD at the prevailing rate at inception (USD144A - AUD/USD=0.7879, Euro and Sterling - AUD/USD=0.7772).

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fully covered distributions

• Distribution payout ratio[(1)] of 53.4%

• Distribution components:

• 7.47 cents APT franked profit distribution

• 2.03 cents APT unfranked profit distribution 6.58 cents APT capital distribution

• 2.97 cents APTIT profit distribution

• 2.45 cents APTIT capital distribution

• 21.5 cents

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OCF per security(2) Distributions
100 cents
90.7
87.1
77.1
80 cents
60 cents 56.3
49.6
43.5 45.0
41.5 41.4 39.8
38.0
40 cents 36.3
21.0 21.5
20 cents
0 cents
FY14 FY15 FY16 FY17 FY18 1H 1H
FY18 FY19
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Notes:

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Franking Credits

• Franking credits of 3.2 cents per security allocated to the interim APT profit distribution

• Stapled security tax structure

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• Pass-through trust entity

• Profits from APT to be distributed with franking credits, where available

• FY18 effective cash tax rate of 12.1%, due to utilisation of available existing losses and R&D tax offsets

• (1) Distribution payout ratio: distribution applicable to the 1H FY19 as a percentage of operating cash flow.

• (2) Operating cash flow per security has been adjusted for the rights issue completed on the 23 March 2018.

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FY2019 guidance

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• Based on current operating plans and available information, EBITDA for FY2019 is expected to be within the upper end of the guidance range of $1,550 million to $1,575 million

• Net interest costs for FY2019 expected to settle towards the lower end of the range of $500 million to $510 million

• Distributions per security for FY2019 expected to be in the order of 46.5 cents per security, with the 3.2 cents per security of franking credits announced for the half year and any further franking credits that may be allocated to the final distribution attaching to that cash payout

• Committed capex spend on track for FY2019, in the order of ~$425 million

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outlook results overview and strategic highlights Mick McCormack Managing Director and CEO.

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customers & consumers – front and centre

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APA’s Customer Promise

• APA’s top 20 transmission customers surveyed

Our vision: Together, deliver energy for a better Australia.

• Improving the customer experience is an ongoing focus

• Supports and is aligned to APA’s commitment to The Energy Charter

• First whole-of-industry initiative to deliver better customer outcomes

• Live as at 1 January 2019

• Comprehensive rollout plan - internal and external stakeholders

• 17 Australian energy company signatories

• First disclosure reports - to be published end Sept 19

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It’s APA’S commitment to our customers as to what they can and should expect from us.

• Accountability panel to assess disclosures

• Five Principles:

1. We will put customers at the centre of our business and the energy system.

2. We will improve energy affordability for customers.

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3. We will provide energy safely, sustainably and reliably.

4. We will improve the customer experience.

5. We will support customers facing vulnerable circumstances.

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North America - exploring opportunities

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• In FY17, APA advised the market that we were exploring opportunities in North America as part of APA’s long term growth strategy

• US Houston office opened in August 2017 with 2 full-time employees

• CKI proposal stalled progress in 1H FY2019

• Ongoing due diligence of the North American gas infrastructure sector now continuing with a focus on:

• acquiring a gas infrastructure business that will provide a strong platform for future growth

• targeting businesses with the same or lower business risk profile as APA

• The North American gas infrastructure sector continues to remain attractive due to:

• favourable gas fundamentals with over 80 years of gas supply

• attractive rates of return

• transferrable APA operational expertise and knowledge, applicable to the North American gas sector

• significant number of entry points available

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APA’s uniquely integrated energy assets

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Assets and Investments Glossary
AGPGLOS Amadeus Gas Pipeline WPP Darwin
AL Agnew Lateral 830 PJ
BGP Bonaparte Gas Pipeline BGP
BWSF Badgingarra Wind and Solar Farms
BWP Berwyndale Wallumbilla Pipeline 17,384 PJ
CGP Carpentaria Gas Pipeline
CRP Central Ranges Pipeline &
distribution network AGP
CWP Central West Pipeline
DDSF Darling Downs Solar Farm 53,069 PJ
DPS & LPS Diamantina & Leichhardt DPS & LPS
EGP Power StationsEastern Goldfields Pipeline PPS NGPTGP Northern Territory Mount Isa X41 PS
EDWSF Emu Downs Wind and Solar Farms Queensland
EP Ethane Pipeline CGP
GGP Goldfields Gas Pipeline Western 37,988 PJ Gladstone
GPS Gruyere Power Station (formerly GGP Australia 257 PJ
Yamarna Power Station) WGP
BWP
IOC Integrated Operations Centre SWQP RCWP Daandine PS &
KKPMP Kalgoorlie Kambalda PipelineMid west Pipeline MP AL GPS South 1,034 PJ Wallumbilla DDSF Kogan North GPPBrisbane IOC
MGP Mortlake Gas Pipeline YGP Australia Moomba Tipton West GPP Directlink RBP
MGPSF Mondarra Gas Processing & MGPSF MMGP EGP
MMGPMSP Storage FacilityMt Morgans Gas PipelineMoomba Sydney Pipeline 838 PJPerth PGPBWSFEDWSF KKP EP MSP WalesSouthNew CRP
NGP Nifty Gas Pipeline CWP
OGPP Orbost Gas Processing Plant North Brown Hill
PGP Parmelia Gas Pipeline Wind Farm 26 PJ
PPS Pilbara Pipeline System Murraylink Sydney
RBP Roma Brisbane Pipeline Adelaide Victoria
RCWP Reedy Creek Wallumbilla Pipeline APA assets and investments Gas storage SGP
SESA South East South Australia Pipeline APA operate d asset s Wind Farm SESA VTS Dandenong
SGPSWQP SEA Gas PipelineSouth West Queensland Pipeline Electricity interconnectorsOther natural gas pipelines Solar Farm MGP Melbourne LNG Facility OGPP
TGP Tipton Gas Pipeline Integrated Operations Centre 2,272 PJ
VTS Victorian Transmission System Natural Gas & 502 PJ 73 PJ
WGP Wallumbilla Gladstone Pipeline ethane 2P reserves, Gas-fired power station
as at November 2018
WPP Wickham Point Pipeline Source: EnergyQuest December 2018 Gas processing plant Tasmania
X41 X41 Power Station
YGP Yamarna Gas Pipeline LNG plants
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supplementary information.

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23

snapshot of APA

Australian gas transmission pipeline ownership by kilometres ~ APA is Australia’s largest gas pipeline owner ~

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Jemena 2,349 km
AGIG 3,770 km
15,400 km
SEA
APA Group Gas EII
0 1,500 3,000 4,500 6,000 7,500 9,000 10,500 12,000 13,500 15,000
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Note: *** includes SEA Gas Pipeline and Mortlake Pipeline Source:** AER State of the Energy Market May 2018 ; Company reports; APA data as at 31 Dec 2018 and includes the Ethane Pipeline.

Total securityholder returns since listing vs index ~ Strong track record of delivering securityholder returns ~

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2000 TSR CAGR 17.0% p.a. over ~18.5 years
1600
1200
800
400
0
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APA Overview (Ticker: APA AU)

Market cap A$11.1 billion (as at 19 Feb 2019) ASX rank S&P/ASX 50

Credit rating Moody’s: Baa2 (outlook Stable) S&P: BBB (outlook Stable)

Assets In excess of $20 billion owned/ Gas transmission[(1)] operated

15,400 km transmission pipelines Underground & LNG gas storage Gas distribution[(2)]

~28,900 km gas mains & pipelines ~1.4 million gas consumers

Other energy infrastructure[(1,3)] 780 MW, power generation 244 km HV, electricity transmission 45 TJ/d, gas processing plants 18 PJ, gas storage facility 12,000 tonnes, LNG storage facility Employees ~1,800

Notes:

• (1) Includes 100% of assets operated by APA Group, which form part of Energy Investments segment, including SEA Gas and EII.

APA total securityholder return S&P/ASX 200 accumulation index Utilities accumulation index

• (2) Includes 100% of assets operated by APA Group in Queensland, New South Wales, Victoria and South Australia.

• (3) Does not include infrastructure under construction or commissioning.

24

Source: IRESS, APA TSR as at 15 February 2019

group structure

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• APA is a stapled structure comprising two registered managed investment schemes:

• Australian Pipeline Trust (ARSN 091 678 778)

• APT Investment Trust (ARSN 115 585 441) is a pass-through trust

• Australian Pipeline Limited (ACN 091 344 704) is the responsible entity of APT and APTIT

• APA is listed as a stapled structure on the Australian Securities Exchange

• The units of APT and APTIT are stapled and must trade and otherwise be dealt with together

• APT Pipelines Limited (ABN 89 009 666 700) is APA’s borrowing entity, a company wholly owned by APT, and the owner of the majority of APA’s operating assets and investments

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• Reporting business segments

• Energy Infrastructure : APA’s wholly or majority owned energy infrastructure assets

• Asset Management : provision of asset management and operating services for the majority of APA’s investments

• Energy Investments : interests in energy infrastructure investments

25

1H FY19 operational summary – Energy Infrastructure 0 100 200 300 400 500 600 700 800 A$ m900 1H FY16 1H FY17 1H FY18 1H FY19 East Coast + Central regions Western Australia Wallumbilla Gladstone Pipeline South West Queensland Pipeline Roma Brisbane Pipeline Carpentaria Gas Pipeline Diamantina Power Station Darling Downs Solar Farm Other Qld assets Moomba Sydney Pipeline and other NSW pipelines Victorian Transmission System SESA Pipeline and other SA assets Amadeus Gas Pipeline Goldfields Gas Pipeline Eastern Goldfields Pipeline Emu Downs Wind Pilbara Pipeline System Mondarra Gas Storage and Solar Farms and Processing Facility Other WA assets

26

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historical normalised EBITDA by asset – Energy Infrastructure

$ millions	FY15	FY16	FY17	FY18	1H FY18	1H FY19
East Coast Grid
Wallumbilla Gladstone Pipeline	35.8	475.2	488.0	515.9	250.8	276.8
South WestQueensland Pipeline	188.3	240.3	242.4	244.3	123.3	124.0
Moomba Sydney Pipeline and other NSWpipelines	120.8	121.7	149.5	147.1	71.8	75.4
Victorian TransmissionSystem	130.2	120.6	123.0	124.6	70.3	67.5
Roma Brisbane Pipeline	51.1	57.7	58.6	60.9	30.4	29.6
Carpentaria Gas Pipeline	47.9	38.6	35.6	39.0	19.3	20.6
OtherQld assets	17.0	20.6	13.5	14.0	6.7	11.3
East Coast Grid Total	591.1	1,074.7	1,110.6	1,145.8	572.7	605.2
Northern Territory
Amadeus Gas Pipeline	18.0	17.5	18.8	22.9	11.4	10.8
Western Australia
Goldfields Gas Pipeline	123.9	115.1	111.5	111.8	56.5	59.4
Eastern Goldfields Pipeline	0.0	14.2	36.3	37.7	18.3	19.6
Mondarra Gas Storage and Processing Facility	29.1	31.8	33.6	32.8	16.6	17.2
Pilbara Pipeline System	31.1	28.3	27.5	27.8	14.1	13.3
Other WA assets	6.8	8.2	3.4	4.0	1.7	2.4
South Australia
SESA Pipeline and other SA assets	1.9	2.5	2.3	2.6	1.3	1.2
Power Generation
Diamantina Power Station	0.0	23.3	87.4	88.3	43.6	44.3
Emu Downs Wind and Solar Farms	21.7	19.9	22.4	23.6	9.7	10.8
DarlingDowns Solar Farm	0.0	0.0	0.0	0.0	0.0	5.1
Grand Total	823.6	1,335.5	1,453.7	1,497.1	745.8	789.4

Notes: Numbers in the table may not add up due to rounding

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1H FY19 operational summary – Asset Management and Energy Investments

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Asset Management EBITDA

Asset Management

• Main customers: Australian Gas Networks, Energy Infrastructure Investments and GDI (EII)

• Customer contribution average ~$11m p.a.

• Revenue (excl. pass-through revenue) increased by 24.9% but underlying EBITDA lower due to outperformance incentive achieved in 1H FY18

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A$ m30
20
10
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0
1H FY16 1H FY17 1H FY18 1H FY19
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One-off Customer
Contributions
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Underlying Asset
Management
EBITDA
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Energy Investments

• 9.2% increase in earnings

• SEA Gas announced a suite of signed multiple agreements commencing January 2019 for an average term of 5 years

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Energy Investments earnings
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Notes: Historical earnings from EPX and DPS in this graph are classified as Divested & transferred investments.

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Corporate costs

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• Corporate costs have been steady, despite APA’s record growth period

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A$ m 1,000 10%
800 8%
600 6%
(1)
400 (2) 4%
200 2%
0 0%
1H FY14 1H FY15 1H FY16 1H FY17 1H FY18 1H FY19
Corporate costs (LHS) EBITDA (LHS) Corporate costs/EBITDA (RHS)
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Notes:

*EBITDA excluding corporate cost

(1) Includes $11.3 million of costs associated with the CKI proposal and Managing Director’s impending retirement.

(2) Corporate costs excluding one-off items.

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continued growth momentum

Normalised EBITDA

Total assets

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Normalised operating cash flow

Distributions

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debt facilities

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Total committed debt facilities at 31 December 2018

$ million	Facility	Drawn	Tenor
	amount	amount
2015, 2016, 2017 & 2018 Bilateral bank facilities	550	100	2 to 4.6 year facilities maturing between May 2019 to July 2022
2018 Syndicated bank facilities	1,000	355	5 and 5.5 year tranches maturing June and December 2023
2007 US Private placement	516	516	12 and 15 year tranches maturing May 2019 and May 2022
2009 US Private placement	99	99	10 year tranche maturing July 2019
2010 AUD Medium Term Notes	300	300	10 year tranche maturing July 2020
2012 CAD Medium Term Notes	289	289	7.1 year tranche maturing in July 2019
2012 US144a/Reg S Notes	735	735	10 year tranche maturing October 2022
2012 GBP Medium Term Notes	536	536	12 year tranche maturing in November 2024
2015 US144a/Reg S Notes(1)	1,777	1,777	10 and 20 year tranches maturing March 2025 and March 2035
2015 GBP Medium Term Notes(1)	1,140	1,140	15 year tranche maturing March 2030
2015 EUR Medium Term Notes	1,132	1,132	7 year tranche maturing March 2022
2015 EUR Medium Term Notes(1)	879	879	12 year tranche maturing March 2027
2016 AUD Medium Term Notes	200	200	7 year tranche maturing October 2023
2017 US144a/Reg S Notes	1,109	1,109	10.3 year tranche maturing July 2027
Total	10,262	9,167

Notes: (1) USD denominated obligations translated to AUD at the prevailing rate at inception (USD144A - AUD/USD=0.7879, EMTN & Sterling - AUD/USD=0.7772)

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regulatory update

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• Approximately 9.4% of APA’s Energy Infrastructure revenues in 1H FY2019 was regulated revenue

• APA’s major regulatory resets over the next few years are as follows:

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• Central Ranges Pipeline and Network will cease to be covered as of 1 July 2019 in accordance with the National Gas Law and Rules.

• Goldfields Access Arrangement (1H FY2019)

A revision to the Goldfields Access Arrangement was lodged with the ERA in December 2018. The revision is in accordance with current legislation, which provides for separate treatment of covered and uncovered capacity. A revised proposal treating all capacity as covered will be prepared and submitted if legislation implementing the AEMC’s recommendation that the uncovered capacity be treated as covered capacity is enacted prior to the final access determination.

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economic regulation of gas pipelines and networks

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Regulator	•	The Australian Energy Regulator (AER) is responsible for the economic regulation of gas
		transmission and distribution networks and enforcing the National Gas Law and National Gas
		Rules in all jurisdictions except Western Australia
	•	The Economic Regulation Authority of Western Australia (ERA) is the independent economic
		regulator for Western Australia
Access	•	Apply for a term, generally 5 years
arrangement	•	Set out the terms and conditions of third party access, including
		• At least one reference service that is commonly sought by customers – for pipelines, this is
		generally firm forward-haulage services
		• A reference (benchmark) tariff for the reference service
Reference	•	Provides a default tariff for customers seeking the reference service but tariffs can also be
tariff		negotiated for other services
	•	Determined with reference to regulated revenue, capacity and volume forecasts
Regulated	•	Determined using the building block approach to recover efficient costs
revenue		• Forecast operating and maintenance costs
		• Regulatory asset depreciation and
		• Return on value of regulated assets (regulated asset base) based on WACC determination
	•	WACC based on 60:40 debt equity split
Regulated	•	Opening RABs have been settled with the regulator; there are no reassessments for approved
asset base		RABs
(RAB)	•	RABs adjusted every access arrangement period
		• Increased by capital invested into the asset and reduced by regulatory depreciation costs
Regulatory	•	The larger distribution networks and some transmission pipelines are subject to price regulation
coverage	•	Price regulated assets are those which the regulatory authorities have determined, among other
		things, demonstrate natural monopoly characteristics and a degree of market power
	•	Coverage can be revoked
	•	“Light-handed” regulation is effectively a negotiate/arbitrate regime, where tariffs are
		negotiated with users and are subject to determination by the regulator only where the customer
		initiates a dispute

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Wallumbilla Gladstone Pipeline

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• 556 kilometres of transmission pipeline acquired in 2015, servicing QCLNG export facility

• Fully contracted revenue through to 2035, derived through take-or-pay GTAs with foundation shippers (BG Group & CNOOC)

• Initial EBITDA guidance based on US$355 million plus CPI[(1)] for 20 years

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• 2 X 10 year options for shippers to extend

• Average forward USD/AUD exchange rates: - 1H FY19 0.6716

• - 2H FY19 0.7301

• - FY20 0.7192

• - FY21 0.7199

• A$3.8 billion designated USD debt portfolio[(2)]

• 10 and 20 year 144a/Reg S notes, A$1,777 million

• - 12 year Euro Medium Term Notes, A$879 million

• 15 year GBP Medium Term Notes, A$1,140 million

• Operating costs are passed through to shippers

• APA holds all rights to further services and pipeline expansion

Notes :

(1) US CPI to be applied as at 1 January onwards

(2) Original designated debt portfolio ~A$4.8 billion consisted of 10 and 20 year 144a notes, 7 and 12 year Euro MTN, and 15 year GBP MTN

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Orbost Gas Processing Plant

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December 2017
•
•
•
•
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• plant will process up to 68 TJ per day of gas from the offshore Sole gas field from mid2019

• construction upgrade completion expected in Q3 CY2019

• new source of gas supply for eastern Australia

• on spec commissioning gas is expected to be delivered to the market from July 2019

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•
December 2018
•
•
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• future potential to process gas from the Manta gas field, subject to development by Cooper and JV approval

• multi-year gas processing agreement with Cooper Energy

• The sulphur by-product is non-hazardous industrial waste as prescribed by the EPA. It can be disposed of in licensed landfill. However, APA is assessing re-use options for the by-product and will finalise its preferred option or mix of options, prior to commissioning.

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For further information contact: Jennifer Blake Group Head of Investor Relations T: +61 2 9693 0097 M: +61 455 071 006 E: jennifer.blake@apa.com.au Or visit the APA website at: www.apa.com.au

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