Transcript Document

November 2003
Investor Meetings
New York, NY
November 2003
InvestorConference
Meetings
Investors
Cautionary Statement Regarding
Forward-Looking Statements
This presentation contains forward-looking statements. AGL Resources wishes to caution readers that the
assumptions, which form the basis for the forward-looking statements, include many factors that are beyond
AGL Resources’ ability to control or estimate precisely. Those factors include, but are not limited to, the
following: changes in industrial, commercial, and residential growth in the service territories of AGL
Resources Inc. and its subsidiaries; changes in price and demand for natural gas and related products;
impact of changes in state and federal legislation and regulation, including various state public service
commissions and the Federal Energy Regulatory Commission orders, on the gas and electric industries and
on AGL Resources, including the impact of Atlanta Gas Light Company's performance based rate plan;
effects and uncertainties of deregulation and competition, particularly in markets where prices and providers
historically have been regulated, unknown risks related to nonregulated businesses, and unknown issues
such as the stability of certificated marketers; impact of Georgia’s Natural Gas Consumers' Relief Act of
2002; concentration of credit risk in certificated marketers and wholesale services’ counterparties; excess
network capacity and demand/growth for dark fiber in metro network areas of AGL Networks’ customers;
AGL Networks’ introduction and market acceptance of new technologies and products, as well as the
adoption of new networking standards; ability of AGL Networks to produce sufficient capital to fund its
business; ability to negotiate new contracts with telecommunications providers for the provision of AGL
Networks’ dark-fiber services; industry consolidation; performance of equity and bond markets and the
impact on pension fund costs; impact of acquisitions and divestitures; changes in accounting policies and
practices issued periodically by accounting standard-setting bodies; direct or indirect effects on AGL
Resources’ business, financial condition or liquidity resulting from a change in the company’s credit ratings
or the credit ratings of its competitors or counterparties; interest rate fluctuations, financial market conditions,
and general economic conditions; uncertainties about environmental issues and the related impact of such
issues; impact of changes in weather upon the temperature-sensitive portions of the business; and other
risks described in our documents on file with the Securities and Exchange Commission.
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November 2003
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The ATG Value Proposition
Annual
Total Return
8-10+%
Organic Development/
Acquisition 2-3%
Base Business Growth
2-3%
Dividend Yield
4-5%
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November 2003
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2003 Goals
3

Strengthen the company financially

Grow around existing assets

Execute flawlessly in every business segment

Demonstrate a compelling proposition for all our
stakeholders
November 2003
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2003 Scorecard
Financial Strength

$137 million equity offering

$225 million debt offering

Improved cash generation

Increased dividend 4%


Interest rate swaps
Ratings affirmed and one upgrade
 Flawless Execution
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 Asset Development

Displacing pipelines as an
opportunity

Formalized project development
efforts (Pivotal)

Macon peaking pipeline

VNG propane pipeline and expansion
 Compelling Proposition

Achieved strong YTD earnings
results

Zenith of regulatory and
governmental relations

Received favorable regulatory
decisions related to asset
management

Community giving

Increased institutional owner base

Record share price

Employee satisfaction

Increased ownership of SouthStar

Refocused dark-fiber business
November 2003
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High-Quality, Predictable Utility
Operations With Regulatory Stability
Georgia – 1.6 million customers
Service Areas
• Performance-based ratemaking (PBR)
• Maintains straight-fixed variable rates (SFV)
• Regulatory certainty through 2005
• Authorized return levels very favorable
Norfolk
Virginia – 250,000 customers
Chattanooga
Atlanta
• Weather normalization (2-year program)
• Price stability for customers
• Favorable regulatory climate
Tennessee – 60,000 customers
• WNA adjustment offsets weather impact
• Level revenue stream throughout year
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November 2003
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Regulatory Compact Provides
Proper Incentives
16%
14%
AGL Resources Utility Operations
Return on Equity 12 Months Ended June 30, 2003
Percent of Return
12.00
12%
10%
10.96
11.00
11.06
9.51
10.90 10.75
8%
6%
4%
AGLC
Authorized (1)
Actual
VNG
CGC
Authorized
Actual
Authorized
(1) The authorized ROE is 11.00%. The top of the earnings band is 12.00%. The company also can include 1/2 of
VNG synergies in calculating the return prior to sharing – bringing authorized ROE to approximately 12.6%..
(2) Based on actual weather.
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Actual (2)
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Unique Features to Note
ATLANTA GAS LIGHT COMPANY
Environmental Recovery Cost Rider
ATLANTA GAS LIGHT COMPANY
$45
$40
Pipeline Replacement Program Rider
$40
$100
$38
$37
$95
$94
$92
$91
$92
$90
$35
$80
$73
$70
$20
$24
$23
$25
$23
$62
$23
$22
$22
$17
$22
$22
$16
in Millions
in Millions
$30
$60
$50
$50
$49
$51
$50
$48
$43
$39
$40
$15
$28
$30
$10
$21
$20
$4
$5
$2
$0
$0
2002
2003
2004
Net Expenditures
2005
2006
2007
2008
$0
2009
Revenues and Third Party Recoveries
$1
$10
$2
2010
$20
$13
$6
$4
$0
1999
2000
2001
2002
2003
2004
Total Capital
2005
2006
2007
Cash Recovery
Notes: Data based on collection year.
*Investment of $480 million to be recovered through base rates at end of program
• Environmental recovery rider turns cash-flow positive in 2005
• Pipeline replacement program provides return on, and of, capital
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2008
2009
2010
November 2003
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Sequent Provides Incremental Value
From Existing Asset Base
IL
MD
Company Owned
LNG Plants
Cove
Point
VA
Propane Storage
Norfolk
TN



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Three business
lines: producer
services;
transportation
asset management;
storage arbitrage
Asset management
sharing
arrangements
approved in all
states
Emerging
commerce in
peaking services
and other
origination
business
Chattanooga
GA
Atlanta
TX
Elba
Island
LA
Henry
Hub
Henry
Hub
Houston
Lake
Charles
Other
LNG Terminals
Accessible Storage
November 2003
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SouthStar Is Now A Stable,
Annuity-Quality Business
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
ATG owns 70% but earnings
distributed disproportionately

38% market share

Stable, maturing business

60% of earnings from fixed
charges

Focus on maintaining market
share; improving customer
service; and continuing to
implement rigorous controls
around credit quality
Mktr C
14.9%
Others
8.5%
Mktr B
14.5%
GNG
38.1%
Mktr A
24.0%
SouthStar’s Net Income
CY 2002
CY 2001
$41 million
$17 million
Project Development
Activities
November 2003
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Investors
Pivotal Energy Development

Support goal to grow around existing assets

Develop or acquire projects that supplement current assets to:

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–
Reduce the cost of service to ratepayers
–
Create multi-level return opportunities
Value through synergies between existing assets and new
projects
November 2003
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Investors
Declining Regional Load Factor
Southeast Pipeline Capacity Utilization
25,000
74% Load
Factor
65% Load
Factor
20,000
15,000
Capacity (MMcfd)
10,000
Average Throughput
(MMcfd)
5,000
1990
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2000
November 2003
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Declining Load Factor in Georgia
AGLC Load Factor
16.8%
16.6%
16.4%
16.6%
16.2%
16.3%
16.0%
15.9%
15.8%
15.6%
15.6%
15.4%
15.3%
15.2%
15.0%
14.8%
14.6%
2000
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2001
2002
2003
2004
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Regional Opportunities
JOINT
USE
PIPELINE
OPPORTUNITY
VIRGINIA HUB
APPALACHIAN
PRODUCTION
EAST TENNESSEE
INTERCONNECT
VNG PROPANE PEAKING
DIRECT TO ATLANTA PIPELINE
ATLANTA HUB
MACON
LNG
SALT DOME
STORAGE
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ELBA ISLAND
LNG IMPORT TERMINAL
November 2003
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Near-Term Development Plans


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Macon Peaking Pipeline
–
Peaking needs continue to grow in Atlanta despite
declining load factor
–
Currently LNG facility is limited to 50% capability by
constrained take-away capacity
VNG Propane-Air Facility Expansion
–
Additional peaking capacity needed at VNG
–
Modest propane injection has been used to manage peak
needs
–
Improves duration and reliability of propane injection
peaking
November 2003
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U.S. Liquefied Natural Gas Facilities
Everett
Cove Point
4
2
1
3
Elba Island
Lake Charles
AGL Resources LNG Facilities
1
2
3
4
Location
Riverdale
Cherokee
Macon*
Chattanooga
Propane Air-VNG (North)
Propane Air – VNG (South)
Propane Air – Valdosta
Storage
(bcf)
2.5
2.0
1.5
1.2
0.2
0.2
0.07
Capacity
Liquefaction
(Mcfd)
10,000
10,000
10,000
8,000
Storage with liquefaction (57)
Storage without liquefaction (39)
Vaporization
(Mcfd)
400,000
400,000
150,000
90,000
14,400
28,800
3,600
*Pipeline system currently can only accommodate a delivery of 70,000 Mcf/day.
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Source: EIA, Office of Oil and Gas, September 2002
November 2003
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What Makes ATG Different?
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
Location … Location … Location

Management is all over the details

Always searching for opportunities to create value

No surprises

Only promise what we know we can deliver
November 2003
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We Keep Our Promises
$1.91$1.94 $1.96
CY EPS
$2.00
2000 – 2002
CAGR = 16%
$1.84
$1.75
$1.80
$1.51 $1.54
$1.60
$1.40
$1.20
$1.33
$1.36
2000
2001
2002
Consensus Estimate
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2003E
Actual
Revised guidance
upward following
3Q earnings
November 2003
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Meetings
Investors
Upcoming Events

ATG Analyst/Investor Conference – November 17-19
in Savannah, Georgia

4th Quarter/Year-End 2003 Earnings Released –
January 29, 2004

Contact:
Steve Cave
Director, Investor Relations
(404) 584-3801
E-mail: [email protected]
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