Announcement

MKTUPDTE: IFT: Infratil FY2020 Earnings Guidance & Incentive Fee Update 12:02pm 
IFT
13/12/2019 12:02
MKTUPDTE
PRICE SENSITIVE
REL: 1202 HRS Infratil Limited

MKTUPDTE: IFT: Infratil FY2020 Earnings Guidance & Incentive Fee Update

FY2020 Earnings Guidance Update

On 5 December 2019, Tilt Renewables Limited ('Tilt Renewables') which
Infratil is a 65% shareholder in, announced that it had entered into an
agreement to sell the 270 MW Snowtown 2 wind farm ('Snowtown 2') to an entity
wholly-owned by funds managed by Palisade Investment Partners Limited and
First State Super, for an enterprise value of A$1,073 million. The net equity
proceeds from the transaction, after transaction-related costs, are estimated
as approximately A$455 million.

The sale is expected to complete in December 2019 and, as such, Tilt
Renewables will receive income from Snowtown 2 up to the date of completion
of the sale, which is part way through the 2020 financial year (FY2020). Tilt
Renewables has issued updated FY2020 guidance as a result of the sale and has
provided an EBITDAF range of A$118 million to A$122 million (previously A$127
million to A$132 million), reflecting the part year contribution from
Snowtown 2.

Infratil provides earnings guidance on a 'continuing operations' basis
meaning that operations which are disposed of during the year are excluded
from earnings guidance and this approach is applied for the entire year. The
reduction in Infratil's full year Underlying EBITDAF from continuing
operations as a result of the sale of Snowtown 2 will be approximately A$74
million, reflecting the annualised year to date production from this asset
which is above long-term expectations. This results in a revised Underlying
EBITDAF from continuing operations (excluding International Portfolio
Incentive Fee) guidance range for FY2020 of $575 million to $615 million.
Infratil notes that the 9-month earnings contribution from Snowtown 2 will
instead be included in Infratils 'net surplus from discontinued operations
after tax'.

Updated Estimate of FY2020 International Incentive Fees

As part of the 30 September 2019 results announcement, Infratil accrued an
International Portfolio Incentive Fee liability of $12.8 million based on the
estimated fair value of its international investments as at 31 March 2020.
The actual International Portfolio Incentive Fee payable as at 31 March 2020
will be determined at that date based on independent valuations of each of
the relevant investments.

One of the entities for which an International Portfolio Incentive Fee may be
payable is Tilt Renewables. Following Tilt Renewables Snowtown 2 disposal
announcement, Infratil has reassessed the potential International Portfolio
Incentive Fee position and advises that the estimated fee as at 31 March 2020
is now approximately $40 million (an increase of $27.2 million). Infratil
notes that if an International Portfolio Incentive Fee is ultimately
determined to be payable at 31 March 2020, the fee will be payable in three
equal tranches over the period to 31 March 2022, with the payment of the
latter two tranches only being payable if the total valuation of the relevant
investments as at 31 March 2021 and 31 March 2022 respectively, is no less
than the total valuations determined as at 31 March 2020.

Any enquiries should be directed to:

Phillippa Harford, Chief Financial Officer, Infratil Limited
Phillippa.Harford@hrlmorrison.com
End CA:00345988 For:IFT Type:MKTUPDTE Time:2019-12-13 12:02:28

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