Flogas UK Company overview 17 th August 2009

Transcription

1 Flogas UK Company overview 17 th August 2009

2 What is LP Gas? Produced as part of oil refining process or extracted from gas streams Inland sales is 95% propane, and 5% butane (more suited for indoor storage) Transported and stored under pressure in liquid form in tanks / cylinders Has lowest CO2 and particulate emissions of all available off-mains fossil fuels Used in petro-chemical production. and for home and commercial applications where no mains gas: Domestic heating, cooking and leisure Hotels, pubs and restaurants Caravan sites, residential parks Fork lift trucks and warehouse heating Agriculture poultry rearing, growing, food processing Industrial use brick making, paint spraying, road marking Cars and trucks as Autogas

3 LP Gas - Inbound Supply Chain 9 UK refineries Mossmorran Shell Grangemouth - Ineos Immingham Conoco & Total Stanlow Shell Coryton - Petrolplus Fawley - Esso Milford Haven - Murco Pembroke - Texaco 23 Artic Road Tankers Flogas owned fleet Daily sourcing decision: Refinery s availability to supply? Price of gas? Distance from Flogas location? 21 Flogas Terminals Nationwide coverage Gas storage (2-3 days) Cylinder filling / stockholding Base for bulk tankers Base for cylinder trucks

4 LP Gas - Outbound Supply Chain 170 cylinder trucks 100,000 customers 35% 85 bulk tankers 65%

5 Flogas History 1976 Flogas Greenfield start in Ireland, with DCC owning 29% 1984 Flogas UK established with the acquisition of Portagas giving an initial share of 0.5% of the British market DCC takes 100% ownership of Flogas UK Ltd Organic expansion takes market share to 6% with activities in the bulk, cylinder and autogas markets 2001 AltaGas acquisition takes market share to 11% 2002 British Gas LPGas acquisition accelerates Flogas to no.2 position in Britain with market share c.20%

6 Organisation 5 Regions with Sales and Operational responsibility Sales teams covering territory by postcode Customer service centres in /outbound with 24/7 back up Filling plant and depots service and cost KPIs Central sales teams Key Account sales management for national accounts Domestic Bulk customer service team HQ Functions Bulk installations and scheduling Finance, credit control and IT Marketing Business development, purchasing Human Resources

7 Flogas Network 2009/10 R 5 Regional centres, (CSC, Bulk, Filling and Depot) 16 Bulk & or Filling and Depot sites 21 Depot only Refinery R R R RR R R R R

8 Asset Refurbishment Flogas at Staveley undertakes refurbishment and re-branding: 1.8 million cylinders are tested and refurbished over a 15 year cycle 30,000 tanks are to be refurbished and refurbished over a 20 year cycle

9 Market Position Cylinders Bulk Calor 52% Calor 51% Flogas 26% Flogas 18% BP 7% BP 10% Shell 0% Shell 10% Energas 3% Energas >1% Others 12% Others 10% Source: Flogas Estimates

10 Flogas Strengths Strong nationwide coverage under Flogas brand Growth potential behind LPG Spread across diverse customer base Improved margin management Optimised national network Strong Relationship with Oil Majors Excellent financial dynamics recurring revenues, cash generative and high ROCE

11 Challenges Safe management of a highly dangerous product Maintaining supply ex refinery at least inbound cost. Managing high levels of service whilst seeking efficiencies Building returns on fixed capital cylinders, bulk tanks Delivering opportunities for industry consolidation

12 Flogas Strategy Organic Continuously Improve Heath and Safety performance Grow LPG market promote LPG as greener alternative Grow market share geographically, and by sector Deliver operational efficiencies so additional margin converts to profit Implement outcome of network planning review Reduce purchasing costs through better procurement Partnerships Continue to develop the portfolio of suppliers Evaluate partnership options in importation and storage infrastructure Work with energy consultants to offer LPG package for new technologies Acquisitions Acquire competitors looking to exit, and thereby reduce unit costs Acquire dealers where Flogas coverage is weak

13 Questions?