Transcript Real Results Real

Real Results
Real
2003 AGL Resources Shareholder Meeting
Presented By
Paula G. Rosput
Chairman, President and Chief Executive Officer
Welcome To
Ten Peachtree Place
2003 AGL Resources
Shareholder Meeting
AGLR Board of
Directors
Officers and
Management
Guests
Then and Now
Setting Records
highest earnings
per share
value
customers
highest
stock price
peak-day
send outs
value
Today’s Objectives
Review of 2002 Goals and Results
Goals for 2003
Challenges & Opportunities
AGL Resources Corporate Values
value
improve earnings
ATG Earnings Per Share (By Calendar Quarter)
2002- $1.84 per share
19% increase over 2001
Cents
1.00
,90
.80
.70
.60
.50
.40
.30
.20
.10
0
2002
2001
1Q
2Q
3Q
4Q
Strategy or Tactics?


No “new and
improved” strategy
necessary
Stay the course


Execute with precision
Stick with the fundamentals
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03
ATG Stock Price 2002
$25
Dec 16:
Hits $25.00 High
$20
$15
ATG versus S&P and Peer Group
2002
10.7%
2.0%
ATG
LDC
-22.1%
S&P 500
CORE EARNINGS
CORE EARNINGS PER SHARE
Dollars in millions
Dollar
ATG 3-Year Stock & Return Index
140
ATG
130
STOCK PRICE
120
LDCs
110
100
90
80
80
ATG
60
70
40
60
LDCs
20
S&P 500
50
4/00
4/7/00
4/01
4/7/01
4/02
4/7/02
0
Total Return (%)
-20
-40
S&P 500
RETURN ON INVESTMENT
-60
4/00
4/01
4/02
4/03
4/034/7/0
ATG Outperforming Blue-chip Stocks
100%
90%
80%
Home Depot
Coca-Cola
70%
GE
IBM
60%
Wal-Mart
Microsoft
50%
AGL Resources
40%
30%
ATG is trading at 94% of its 52-week high, outpacing nearly every company in
the Dow Jones Industrial Average index
*As of April 2, 2003
ATG Outperforming Its Peers, Too
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
NICOR
Atmos Energy
Western Gas Resources
KeySpan Energy
Peoples Energy
Piedmont Natural Gas
AGL Resources
Trading at 94% of its 52-week high, ATG is outperforming its energy sector peer group, which is
trading at an average of 80% of the 52-week high.
*As of April 2, 2003
change the
value
regulatory paradigm
Regulatory Highlights
Georgia
Settlement
reached
Performancebased plan
Virginia
Weather
normalization
adjustment
Stability In Rates & Relations
Sequent
value
accelerate telecom
Our Current Networks
Phoenix Metro
Atlanta Metro
value
our accomplishments
CORE EARNINGS PER SHARE
SHARE PRICE
Dollar
$1.84
6%
Dollar
$25
value
TOTAL RETURN TO SHAREHOLDERS
Percent
Rate and regulatory
stability
11%
Expanded AGL
Networks
SouthStar
Georgia Natural Gas
70%
30%
Improve customer base
Improve service
Enhance quality of earnings
value
realities
If You Don’t Drill…
Source: EIA
…and you consume more –
Storage Will Fall & Prices Rise
$
10
Historical range of storage volumes 1998-2002
Weekly storage volumes
Natural gas spot prices
3500
3000
9
2500
8
2000
7
1500
6
1000
5
500
4
0
Source: EIA
Mar 01
3
Mar 02
March 03
ay
-0
3
A
ug
-0
3
N
ov
-0
3
Fe
b04
M
ay
-0
4
A
ug
-0
4
N
ov
-0
4
Fe
b05
M
ay
-0
5
A
ug
-0
5
N
ov
-0
5
Fe
b06
M
ay
-0
6
A
ug
-0
6
N
ov
-0
6
Fe
b07
M
ay
-0
7
A
ug
-0
7
N
ov
-0
7
Fe
b08
M
ay
-0
8
A
ug
-0
8
N
ov
-0
8
Fe
b09
M
USD
NYMEX Forward Curve & Volatility
$6.500
$6.000
$5.500
$5.000
$4.500
$4.000
$3.500
$3.000
MONTH/YEAR
Close of Business April 10, 2003
Volatility and Pricing
Use Sequent’s expertise to
benefit our customers
Diversify pipelines and storage
Increased LNG use
value
goals for 2003
strengthen ourselves
value
financially
Equity Offering
Completed a $137 million equity
offering in February
6.4 million shares
Reduced our debt-tocapitalization ratio from 67 to 57
percent
Solidified our credit ratings
Received upgrade to A- by Fitch
Post-Offering
Consensus: $1.85-1.90
Includes dilution of $0.10 per
share from equity offering
Price has recovered nicely
Trading in mid-to-high $23 range
with healthy volumes
Continued after-market
institutional support
grow around our
value
existing assets
Meeting Expectations
Wall Street: 5-7% growth
Operate well run utilities
Limited growth
Regulatory restrictions
Slowing regional economies
Keep costs low – raise revenue
Opportunity
execute flawlessly
value
in every business segment
Not a Luxury – A Necessity
Safety a must
Required commodity
Avoid costly mistakes
Use proven technology
Enhance Sequent’s capabilities using
strict risk management framework
Extend system disciplines to
SouthStar
Reduce Networks’ sales cycle time
demonstrate a compelling
value
proposition
to our stakeholders
Committing To Our Stakeholders
customers
shareholders
value
regulators
communities
value
governance
Board Committees
Finance & Risk
Management
Executive
Nominations &
Corp Gov
aglresources.com
Corporate
Responsibility
Compensation
Audit
value s
Our Core Values
value
seeking
honesty
Where We’re Doing It
$1100
AGLC Cost Per
New Meter
$1000
$900
2002
$140
2003
AGLC O&M Cost
Per Customer
$130
$120
2002
2003
Reducing leak
response time
Creating appointment
times
Payment history
improvement at
SouthStar
Hold and handle times
down at our Customer
Care Center
Our Core Values
value
seeking
honesty
inside
the
lines
generosity
of spirit
V-Force
32,000 hours
in 2002
2nd Habitat for Humanity house
Polar Plunge for Special Olympics
MLK Day
American Heart Association’s Heartwalk
United Way Tug-A-Plane
Volunteer of the Year
Timothy Dasher
Meter Reader
Savannah service center
AGLR Employees
What’s Good For The Company?
2002
the value is “here”
2003
marketers &
constituents
value
continuing to
find the value
strengthen
our finances
flawless
execution
asset use
the real
value
is still here
at
the real
value
is still here
at