Slides
Page 1
Q4 2024 Financial Results and Corporate Update March 7, 2025
Page 2
Forward-Looking Information This presentationcontainsforward-lookinginformation(forward-lookingstatements). Words such as "may","can","would","could","should","likely","will","intend","contemplate","plan","anticipate","believe","aim","seek","future","commit","propose","contemplate","estimate", "focus","strive","forecast","expect","project","target","guarantee","potential","objective","continue","outlook","guidance","growth","long-term","vision","opportunity"andsimilarexpressionssuggestingfutureeventsor futureperformance,as theyrelateto the Corporationor any affiliateof theCorporation,are intendedto identifyforward-lookingstatements. In particular,thispresentationcontainsforward-lookingstatementswithrespectto, amongotherthings,businessobjectives,strategy,expectedgrowth,resultsof operations,performance,businessprojects andopportunitiesandfinancialresults. Specifically,suchforward-lookingstatementsincludedin thisdocumentinclude,butare notlimitedto, statementswithrespectto the following: theexpectationthatREEFandPipestoneII will remainon trackand on budgetandtheanticipatedin- servicedatesfor eachproject; twomarinechartersbeingdeliveredin 2026;deleveragingtargetsincludingadjustednetdebttargets; anticipatedbenefitsof thetollingandsupplycontractwithKeyeraincludingstrengtheningAltaGas’ long-termgrowthoutlook; theCompany’slong-term tollingoutlookand the beliefthat globalexporttollingwill deriskthe business; U.S. customerdemandfor naturalgas and the anticipatedbenefitstherefrom; the beliefthat Asiandemandfor naturalgas and NGLs supportsMidstreamgrowthopportunitiesand expansion;projected globaldemandfor naturalgas, Canadiangas production,NGL productionand Montneygrowthoutlook; anticipatedgrowthopportunitiesin the Utilitiessegmentincludingmodernizationprograms,new metergrowth,the KeweenawConnectorproject,and datacentergrowthand opportunities; anticipatedbenefitsof Utilitiesgrowthprojects; anticipateddatacentergrowth,opportunitiesfor WGL to servicegrowingdemandand the timingthereof; the expectationthatdemandfor naturalgas will increasedue to datacenteradditions; anticipatedbenefitsof data centergrowthon the Utilitiesbusiness; Midstreamnear- and medium-term growthopportunitiesand the anticipatedbenefitstherefrom; expectedfiling,procedureand decisiondatesfor rate casesand modernizationprogramsin the Utilitiesbusinessand the anticipatedoutcomes thereof; AltaGas’ regulatorystrategyacrossjurisdictionswhere we operate; 2025 financialguidanceincludingnormalizedEBITDA of $1,775 to $1,875 million and normalizedEPS of $2.10 to $2.30; AltaGas’ 2025 capitalbudgetof approximately$1.4 billion; expectedallocationof normalizedEBITDAfor 2025by segment; AltaGas’ leveragetargetsincluding4.65x adjustednetdebtto normalizedEBITDAincluding50 percentdebttreatmentfor hybridnotesandpreferredsharesand4.0x adjustednetdebtto normalizedEBITDAexcludinghybridnotesandpreferred shares; anticipatedtimingfor reachinglong-termleveragetargets; the Company’s2025businessplanand its abilityto executethereon; AltaGas’ abilityto executeon strategicprioritiesandthe anticipatedbenefitstherefrom; andthe Trumpadministration’senergypolicyand U.S. tariffs andtheexpectationthatAltaGas’ businesswillnotexperienceanynet-negativenear-termimpactfromtheU.S. tariffs. Thesestatementsinvolveknownand unknownrisks,uncertaintiesand otherfactorsthat may causeactualresults,eventsand achievementsto differmateriallyfrom thoseexpressedor impliedby such statements. Such statementsreflectAltaGas’ currentexpectations,estimates,and projectionsbasedon certainmaterialfactorsandassumptionsat thetimethestatementwasmade. Materialassumptionsinclude: AltaGas' effectivetax rate, U.S./Canadiandollarexchangerates; inflation; interestrates,creditratings,regulatoryapprovalsandpolicies; expectedcommodity supply,demandand pricing; volumesand rates; propanepricedifferentials; degreeday variancefrom normal; pensiondiscountrate; financinginitiatives; the performanceof the businessesunderlyingeachsector; impactsof the hedgingprogram; weather; fracspread; accessto capital; futureoperatingandcapitalcosts; timingand receiptof regulatoryapprovals; seasonality;plannedandunplannedplantoutages; timingof in-servicedatesof new projectsandacquisitionand divestitureactivities; taxes; operationalexpenses; returnson investments; dividendlevels; and transactioncosts. AltaGas’ forward-lookingstatementsare subjectto certainrisks and uncertaintieswhich couldcauseresultsor eventsto differfrom currentexpectations,including,withoutlimitation: healthand safetyrisks;operatingrisks;infrastructure; naturalgas supplyrisks; volumethroughput; serviceinterruptions; transportationof petroleumproducts; marketrisk; inflation;generaleconomicconditionsincludingtariffs; internalcreditrisk; capitalmarketand liquidityrisks; interestrates; foreignexchangerisk; debtfinancing,refinancing,and debtservicerisk; counterpartyand supplierrisk; constructionand development; cybersecurity, information,and controlsystems;regulatoryrisks; changesin law; climate-relatedrisks; environmentalregulationrisks;Indigenousand treatyrights; litigation; dependenceon certainpartners; politicaluncertainty, activism,civil unrest, terroristattacksandthreats,escalationof militaryactivityand actsof war; risksrelatedto conflict,includingthe conflictsin EasternEuropeandtheMiddleEast; decommissioning,abandonmentand reclamationcosts;reputationrisk; weatherdata;technicalsystemsand processes incidents; growthstrategyrisk; failureto realizeanticipatedbenefitsof acquisitionsand dispositions; underinsuredand uninsuredlosses;impactof competitionin AltaGas' businesses; counterpartycreditrisk; compositionrisk; collateral; rep agreements; marketvalue of the Common Sharesandothersecurities; variabilityof dividends; potentialsalesof additionalshares; laborrelations; keypersonnel; riskmanagementcostsandlimitations; commitmentsassociatedwithregulatoryapprovalsfor the acquisitionof WGL; costof providingretirementplanbenefits; failure of serviceproviders; risks relatedto pandemics,epidemicsor diseaseoutbreaks; and the otherfactorsdiscussedunder the heading"Risk Factors"in the Corporation’sAnnualInformationForm for the year endedDecember31, 2024 ("AIF")and set out in AltaGas’ other continuous disclosuredocuments. ManyfactorscouldcauseAltaGas'or any particularbusinesssegment'sactualresults,performanceor achievementsto vary fromthosedescribedin thisMD&A,including,withoutlimitation,thoselistedaboveand the assumptionsuponwhichthey are basedprovingincorrect. These factorsshouldnot be construedas exhaustive. Shouldone or more of these risksor uncertaintiesmaterialize,or shouldassumptionsunderlyingforward-lookingstatementsproveincorrect,actualresultsmay vary materiallyfrom thosedescribedin this MD&A as intended,planned, anticipated,believed,sought,proposed,estimated,forecasted,expected,projectedor targetedand suchforward-lookingstatementsincludedin this MD&A,shouldnot be undulyreliedupon. The impactof any one assumption,risk,uncertainty,or otherfactoron a particularforward- lookingstatementcannotbe determinedwithcertaintybecausetheyare interdependentand AltaGas’futuredecisionsandactionswill dependon Management’sassessmentof all informationat the relevanttime. Suchstatementsspeakonlyas of the dateof thisMD&A. AltaGasdoes notintend,anddoesnotassumeanyobligation,to updatetheseforward-lookingstatementsexceptas requiredby law. Theforward-lookingstatementscontainedin thisMD&Aare expresslyqualifiedby thesecautionarystatements. Financialoutlookinformationcontainedin this presentationabout prospectivefinancialperformance,financialposition,or cash flows is based on assumptionsabout future events,includingeconomicconditionsand proposedcoursesof action,based on AltaGasmanagement's assessmentof therelevantinformationcurrentlyavailable. Readersarecautionedthatsuchfinancialoutlookinformationcontainedin thispresentationshouldnotbe usedforpurposesotherthanforwhichit is disclosedherein. Additionalinformationrelating to AltaGas, including its quarterly and annual Management'sDiscussionand Analysis (MD&A) and ConsolidatedFinancialStatements,AIF, and press releases are availablethrough AltaGas' website at www.altagas.ca or through SEDAR+ at www.sedarplus.ca. NON-GAAPMEASURES This presentationcontainsreferencesto certainfinancialmeasuresthat do not have a standardizedmeaningprescribedby US GAAP and may not be comparableto similarmeasurespresentedby otherentities. The non-GAAP measuresand their reconciliationto US GAAP financial measuresare shownin AltaGas’ MD&A as at and forthe periodendedDecember31, 2023.Thesenon-GAAPmeasuresprovideadditionalinformationthatmanagementbelievesis meaningfulregardingAltaGas' operationalperformance,liquidityand capacityto funddividends,capital expenditures,andotherinvestingactivities. Readersare cautionedthatthesenon-GAAP measuresshouldnotbe construedas alternativesto othermeasuresof financialperformancecalculatedin accordancewithUS GAAP. EBITDAis a measureof AltaGas' operatingprofitabilityprior to how businessactivitiesare financed,assetsare amortized,or earningsare taxed. EBITDAis calculatedfrom the ConsolidatedStatementsof Income(Loss)usingnet income(loss)beforeincometaxesadjustedfor pre-tax depreciationand amortization,and interestexpense. NormalizedEBITDAincludesadditionaladjustmentsfor transactioncostsrelatedto acquisitionsand dispositions,unrealizedlosses(gains)on risk managementcontracts,gainson investments,gainson sale of assets,restructuring costs,dilutionloss on equityinvestment,provisions(reversalof provisions)on assets,provisionson investmentsaccountedfor by the equitymethod,foreignexchangegains,and accretionexpensesrelatedto asset retirementobligations. AltaGaspresentsnormalizedEBITDA as a supplementalmeasure. NormalizedEBITDAis usedby Managementto enhancethe understandingof AltaGas' earningsover periods. The metricis frequentlyused by analystsand investorsin the evaluationof entitieswithinthe industryas it excludesitemsthat can vary substantially betweenentitiesdependingon theaccountingpolicieschosen,thebookvalueof assets,andthecapitalstructure. Normalizedearningsper shareis calculatedwithreferenceto normalizednet incomedividedby the averagenumberof sharesoutstandingduringthe period. Normalizednet incomeis calculatedfromtheConsolidatedStatementsof Income(Loss)usingnet income(loss)applicableto commonsharesadjustedfor transactioncostsrelatedto acquisitionsand dispositions,unrealizedlosses(gains)on risk managementcontracts,non-controllinginterestportionof non-GAAP adjustments,gainson investments,gainson sale of assets,provisionson assets,restructuring costs,dilutionlosson equityinvestmentand provisionson investmentsaccountedfor by the equitymethod. Normalizednet incomeper shareis used by Managementto enhancethe comparabilityof AltaGas’ earnings,as thesemetricsreflectthe underlyingperformanceof AltaGas’ businessactivities. Fundsfromoperationsis calculatedfromtheConsolidatedStatementsof CashFlowsandis definedas cashfromoperationsbeforenetchangesin operatingassetsandliabilitiesandexpendituresincurredto settleassetretirementobligations. Netdebt,adjustednetdebtandadjustednetdebtto normalizedEBITDAare usedby the Corporationto monitoritscapitalstructureandaccessitscapitalstructurerelativeto earnings. It is alsousedas a measureof theCorporation'soverallfinancialstrengthandis presentedto provide thisperspectiveto analystsandinvestors. Netdebtis definedas short-termdebt,pluscurrentandlong-termportionsof long-termdebt,currentandlong-termportionsof financeleaseliabilities,andHybridNotes,lesscashandcashequivalents. Adjustednetdebtis definedas net debt adjustedfor currentandlong-termportionsof financeleaseliabilities,HybridNotes,anddebtassociatedwithacquisitionsthatoccurredin the lasthalfof thefiscalyear. Adjustednet debtto normalizedEBITDAis calculatedby dividingadjustednet debtas definedaboveby normalized EBITDAfor theprecedingtwelve-monthperiod. 2
Page 3
Agenda 3 2024 Achievements REEF and Pipestone II Project Updates Keyera Commercial Agreements Macro Environment Longer-term Growth Projects Q4/24 Results and 2025 Outlook Execution of Strategic Priorities Driving Shareholder Value 1 2 3 4 5 6 7
Page 4
Strong Progress on Strategic Priorities in 2024 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 Dec-2418 19 20 21 22 23 24 25E Adjusted Net Debt 20 21 22 23 24 25E20 21 22 23 24 25E 2024 Achievements Notes: 1) Non-GAAP financial measure; see discussion in the advisories; 2) Based on year-over-year rate base, including Washington Gas and SEMCO; and 3) Represents year-over-year change in Adjusted Net Debt in 2024. 4 Financial Execution and Growth Commercial De-risking and Shareholder Value Normalized EBITDA1 Top of guidance range Normalized EPS1 Upper-half of guidance range $1.675B - $1.775B $1.769B Guidance $2.05 $2.18 Guidance - $2.25 7% 9% 5-year CAGR >5% Rate Base Growth2 >$720MM invested across Utilities on to meet customers long-term needs Robust Global Exports Record volumes of >122 kbd across 80 VLGCs Midstream Projects On Track REEF FID and on track for 2026 YE; Pipestone II on schedule for 2025 YE ~100% Y/Y ~$0.5B Y/Y Debt Reduction3 Expanding Utilities Customers Meeting strong customer demand; added >12,000 new meters 5-Year CAGR Maritime Time Charters 3 Time Charters operating; 2 more slated for delivery in 2026 ~14% 5-Year TSR CAGR +20% 2024 Share Price Performance Utilities, Midstream and Blended Peers Higher Tolling REEF Tolling Target Achieved Reached base tolling target in Feb 2025De-risking cash flows on Global Exports Strong Utilities Execution Increased EBITDA by 14% Y/Y; strong cost management and execution 1
Page 5
REEF Update 5 Delivery 2024 2025 2026 Timeline Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 EPF1 Site Prep. Installation CSU2 EPF1 Construction CSU2 EPF1 Site Prep. Installation CSU 2 UplandsRail YardJetty Notes: 1) EPF = Engineering, procurement and fabrication.; 2) CSU = Commissioning and startup. Project Execution Final Investment Decision Site Clearing Milestones Cleared To-Date 78 piles placed; productivity increasing In-Water Piling ~50% firm price EPC awarded; additional 10% to be fixed in Q2/25 EPC Contracting Overburden removal and disposal substantially complete Rock blasting ~70% complete Earthworks Commercial Base tolling target achieved FEED Offsite Fabrication Accumulator and bullets ~65% complete; compression and refrigeration progressing Base Commercial Contracting Overburden Removal Piling Set-Up 2 REEF On-Budget & Schedule; Strong Construction Progress in 2024 Rail Offloading Foundation
Page 6
Pipestone II Update 6 Delivery 2024 2025 Timeline Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Acid Gas Wells Gas Gathering Facility Project Execution Milestones Cleared To-Date Commercial 2 Drilled and Completed Acid Gas Injection Wells Principally all work executed or under firm price EPC awards EPC Contracting Pipeline construction complete; ready for partial start up Gathering System 100% contracted under long-term take-or-pay with marquee producers 65% of construction complete; earthworks complete Facility Construction Project Execution ⬤ Safety No significant safety incidents. ⬤ Quality No significant issues to date. ⬤ Risk All major risks have mitigation in place. ⬤ Regulatory, Environmental and Stakeholder No surprises in regulatory or approvals. No major environmental incidents. Continued strong local community support. Final Investment Decision FEED Acid Gas Wells Site Clearing Gathering System Pipestone II on Track for December 2025 Start Up
Page 7
“Win-Win” Industry Solutions 7 Ferndale RIPET & REEF Pipestone I & II Keyera Fort Saskatchewan (KFS) Far East Index (FEI) Propane and Butane Tolling has provided ~US$5/Bbl Better propane netback vs. US Markets the past two years. US Markets Asian Markets with stable and predictable export volumes and cash flows. Long-term Export Tolling Leveraging each company’s infrastructure to drive competitive industry solutions 3 12,500 bbls/d of export tolling volumes; 15-year agreement. Provides stable and predictable export volumes and cash flows. Access to Keyera's rail, storage, and logistics in Alberta's Industrial Heartland. Allow efficient connecting of LPG volumes into global exports' network. A Access Marquee Logistics Network B Secure FSK Frac Capacity with Take-in-Kind Rights C Secured long-term capacity at KFS. Take-in-kind LPG rights return LPG barrels to link into global exports. Strengthening ALA’s Long-Term Growth Outlook
Page 8
Global Export – Long-Term Tolling Outlook 8 Global Export Tolling Volumes 2022 2023 2024 Post REEF ISD >100 kbd of tolling post REEF ISD 3 Global Export Tolling Derisks Business Over Long-term
Page 9
Strong Environment for Gas Utilities Investments 9 U.S. Natural Gas Demand U.S. Gas-Fired Electrical Generation Efficiency and Reliability Drives Long-term Demand Sources: EIA; Energy Analysis; AGA; U.S. Department of Energy, RRA; Internal Analysis Using US Government Reported Public Information 0 1,000 2,000 3,000 4,000 1950 1960 1970 1980 1990 2000 2010 2020 Billion KWh petroleum and other renewables nuclear natural gas coal All while natural gas has also played a critical role in electric grid stability U.S. Natural gas demand has grown ~20 Bcf/d over past decade 1 2 3 4 5 6 4 Growing Role of Gas Strong Customer Demand for Natural Gas Drives Continued Multi-Decade Rate Base Growth U.S. Household Energy Demand Consumption per Home, Gas vs. Electric 0 25 50 75 100 125 Michigan Virginia Maryland District of Columbia U.S. Average Natural Gas Electricity Natural gas represents nearly 70% of U.S. household energy consumed DMV Population Drives Strong Growth Gas-fired Power Demand & Load Growth 5.0 15.0 25.0 35.0 45.0 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024E 2030E Bcf/d Data Center demand Coal Retirements Coal retirements and data centers expected to add 5-10 bcf/d of demand by 2030 0 20,000 40,000 60,000 80,000 2018 2019 2020 2021 2022 2023 2024 YTD Cumulative New Meter Additions Gas customer demand growth is strong with ~1% annual new utilities connects Which supports a robust long-term outlook for gas utilities due to reliability and cost benefits Average U.S. electricity customer faces 5.5 hours of outages every year Average U.S. gas customer faces one outage every 100 years 65 70 75 80 85 90 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 BCF/DBcf/d Therm
Page 10
Robust Asian Demand Supports Midstream Expansion 10 Global Natural Gas Demand Montney Growth Outlook Sources: EIA; Energy Aspects; Wood Mackenzie 1 2 3 4 5 6 4 Strong Asian Demand for Natural Gas and NGLs Provides Robust Midstream Growth Opportunities Global LPG Exports WCSB NGL OutlookCanadian Natural Gas Production Canadian Energy Export Projects Recently Completed In Construction0 15 30 45 60 75 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 (MMboe/d) 0.80 1.00 1.20 1.40 1.60 1.80 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 (MMbbl/d) 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 MMBbl/d AB 0 5 10 15 20 25 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Coastal Gas Link TMX Expansion LNG Canada Woodfibre and Cedar LNG REEF Middle East (bcf/d) 0 3 6 9 12 15 18 2022 2023 2024 2025 2026 2027 2028 2029 2030 Natural Gas Production (bcf/d) Norway Robust global natural gas demand; driving need for higher supply for producing nations Asian LPG demand equally robust; driving the need for more Canadian exports Major Canadian export projects are connecting markets and facilitating growth Positioning Canadian gas production to rise ~25% through 2030 to >22 Bcf/d. Which will bring robust associated NGLs that need to be exported outside of Canada. The Montney is at the center of this growth; requiring major infrastructure investments. Alberta Montney B.C. Montney
Page 11
Attractive Runway of Utilities Growth Projects 11 Notes: *See "Forward-looking Information“ Utilities Project Backlog to Drive Long-Term Shareholder Value Data Centers Opportunities advancing for WGL to service growing demand. Compliment already robust utilities growth outlook. Conservative approach with planned accelerated rate base depreciation schedules. Keweenaw Connector System expansion within the Keweenaw Peninsula of Michigan. Ensures stable supply and system resiliency for new and existing customers. Extends service to 14,000 customers at SEMCO. New Meter Growth Continue to grow residential and commercial customers over 1% per year. Added over 12,000 new meters in 2024. New meter growth off to a strong start in 2025. Modernization Programs Over $1.7B of ARP spending approved or waiting approval through next four years. Regulators remain supportive of system betterment and initiatives to improve safety and reliability. 5 Strong Customer Demand Driving Utility Growth
Page 12
Data Center Growth Opportunity 12 Share of Top U.S. Data Center Locations Northern Virginia leads the way with roughly one-third of all U.S. data centers. A Our Path for Value Creation Our service territory covers the most active area globally for data center build out. AltaGas continues to work with numerous data center developers in Northern Virginia around building pipeline interconnects to provide natural gas for onsite power generation. Business development and engineering work on these opportunities is expected to progress through 2025 with potential construction in 2026 and onwards. We are pursuing these opportunities on a de-risked basis through traditional rate regulated investments with unique rate structures. Virginia peak load CAGR increased by 4x from 2022 forecast to 2025 forecast. B Northern Virginia 29% New York 8% Chicago 7%Dallas 7%Silicon Valley 6% Phoenix 5% Other 38% Source: McKinsey & Co, PJM, TD Securities Data Center Opportunity to Compliment Utilities Growth Profile 15 25 35 45 55 2013 2016 2019 2022 2025 2028 2031 2034 2037 Peak Summer Load Forecast (GW) Historical 2022 Forecast 2025 Forecast *Dominion service territory Virginia* Summer Peak Load 23% 19% 17% 15% 11% 8% 8% 5% 0% 5% 10% 15% 20% 25% 2023 2024 2025 2026 2027 2028 2029 2030 PJM Minimum Reserve Capacity Margin (15%-18%) Based on a normal build out of new capacity, PJM is warning of a system capacity shortfall as soon as 2026/2027. This likely drives an increase for behind the meter agreements with data centers. C PJM Capacity Shortfall Projections 5
Page 13
Attractive Runway of Near-to-Medium Term Growth Projects 13 Notes: *See "Forward-looking Information“ Midstream Project Backlog to Drive Long-Term Shareholder Value North Pine Expansion Strategic fractionation facility within the NEBC Montney. Expands current capacity of 25,000 Bbls/d by ~2x to serve production growth within the Montney as LNG Canada comes online. Dimsdale Expansion Premiere natural gas storage facility in Alberta Montney. Current capacity of 15 Bcf is expandable to 69 Bcf. Strategic asset for LNG balancing serving growing Montney production as LNG Canada comes online. Pipestone III Strong customer demand for additional processing and liquids handling capacity in key Montney growth area. Further de-risks global exports by adding meaningful long-term LPG supply. REEF Expansion Customer demand and basin growth outlook supports need for additional phases. Expansions benefit from REEF’s pre-build common infrastructure. 5 Customer Demand Driving Midstream Growth Opportunities
Page 14
Strong Operational and Financial Quarter; Executing On Our Strategic Priorities Q4/2024 Highlights 14 Operations >122,000 Bbls/dGlobal Exports Utilities Heating Degree Days (D.C. & MI) 14% below normal (2025 YTD weather colder than normal) 15% Y/Y Growth across G&P, Frac and Liquids, and Extraction volumes Midstream Throughput Financial Performance Normalized EBITDA1 Normalized EPS1 ($MM) Q4 2023 Q4 2024 $502 $520 Q4 2023 Q4 2024 $0.76 $0.76 Growth and Execution Townsend Volumes +20% Y/Y volume increase Townsend whitespace optimization 3 Utilities Projects Keweenaw advancing (pre-FID) Data centers under evaluation 4 Midstream Projects REEF and Pipestone II on budget and on schedule. 1 Utilities Investments Ongoing customer/meter growth; $178MM capex w/$85MM ARP capital 2 Commercial Agreements Pipestone I Contract Extension 5-year extension Large Canadian IG producer Townsend Agreement +100 MMcf/d Two new contracts with high-single digit average contract length Global IG energy company Covers gas processing, frac and liquids handling REEF Tolling Agreements Reached base tolling target in Feb 2025 6 Notes: 1) Non-GAAP financial measure; see discussion in the advisories.
Page 15
Utilities – Q4/24 Performance 15 +8% Y/Y Growth Normalized Utilities EBITDA1 Regulatory and Advocacy Capital Investments Rate base growth through modernization investments and new customer connects. Strong O&M savings; partially offset by warmer weather in D.C. and Michigan Growth partially offset by lower Retail results, Maryland rate case and weather. $178MM Invested Capital1 Modernization Programs and Rate Case Filings Continue to Grow Base Business $85 MM directed to ARP and modernization initiatives $75MM invested across system betterment programs. Focused on balancing safety, reliability and affordability for customers. D.C. supportive of modernization programs, with extension of PROJECTpipes 2 ARP to 2025 YE. D.C. modernization application for District SAFE filed on September 27, 2024, requesting US$215MM for 3 years. D.C. rate case filed August 5, 2024 for US$45.6MM increase in base rates, including US$12MM ARP surcharge and 10.5% ROE. Q4/24 Utilities results exceeded expectations; cost management playing key role Cost Management Initiatives 7% Y/Y reduction in O&M at WGL and SEMCO Driven by process efficiencies, removal of unnecessary expenses, and focus on core operations. Structuring projects to optimize costs and maximize revenue. 7% Y/Y Reduction In O&M D.C. Notes: 1) Non-GAAP financial measure; see discussion in the advisories. 6
Page 16
Midstream – Q4/24 Performance 16 Frac, Extraction & Liquids Handling +32% Y/Y volume growth2 +12% Y/Y for North Pine, Younger and Harmattan for frac and liquids handling volumes. Townsend extracted propane volumes +20% year over year. Strong Pipestone liquids additions. Macro Fundamentals Continue to Drive Growth Strategic infrastructure continues to contribute to outsized growth, supported by strong global exports Notes: 1) Non-GAAP financial measure; see discussion in the advisories. 2) Total extracted NGL volumes Gathering & Processing +12% Y/Y volume growth Addition of Pipestone volumes. Strong performance at Townsend, Blair Creek and Harmattan. NEBC and Basin activity remain strong despite depressed natural gas prices. Global Exports +34% Y/Y Growth 0 25,000 50,000 75,000 100,000 125,000 150,000 2Q19 4Q19 2Q20 4Q20 2Q21 4Q21 2Q22 4Q22 2Q23 4Q23 2Q24 4Q24 Global Export Volumes (bbl/d) RIPET Ferndale Steady Growth Since 2019 Export Tolled Volumes Continue to de-risk the global exports platform with increased tolling. Growth driven by increased tolling at both RIPET and Ferndale. Tolled volumes 2023 2024 6
Page 17
$0.75 $1.00 $1.25 $1.50 $1.75 $2.00 $2.25 2018 2019 2020 2021 2022 2023 2024 2025E 2024 2025E 2025 Financial Guidance Normalized EBITDA1,2 Guidance ($ millions) Normalized EPS1,3 Guidance Notes: 1) Non-GAAP financial measure; see discussion in the advisories; 2) Nearest GAAP measure of Net Income Before Income Taxes for the full year 2024 was $746 million; 3) Nearest GAAP measure of Net Income per Common Share for the full year 2024 was $1.95. See "Forward-looking Information“ $1,775 - $1,875$1,769 Utilities: ~ 54% - 58%Utilities: ~56% Midstream: ~ 42% - 46%Midstream: ~44% Focused on growing long-term per share value + Higher utilization at Montney facilities + Colder weather (DC & MI) + Cost management – Lower Harmattan cogen revenue – Higher tolling on exports – Blythe performance (transmission congestion) Tailwinds / Headwinds 17 $2.10 - $2.30 6
Page 18
2025 Capex Budget 18 2025 Capital Budget: $1.4 Billion Capital deployment reflects the continued strong growth opportunities. Largest 2025 capital outlays include REEF, Pipestone II, Utilities ARP and system betterment. Midstream Allocation Strong organic growth opportunities across both platforms – driving healthy competition for capital. Attractive investment opportunities in Midstream driving current increased allocation. Midstream: REEF, Pipestone II Maintenance & Turnaround Optimization capital Utilities: ARP/MRP Programs System Betterment New Business & Customer Growth Strong Growth Opportunities Across the Enterprise Notes: *See "Forward-looking Information“ Utilities 51% Midstream 45% Corporate / Other 4% 6 28% 10% 12% 20% 41% 45% 70% 89% 87% 78% 54% 51% 2% 1% 1% 2% 4% 4% 2020 2021 2022 2023 2024 2025E Midstream Utilities Corporate / Other
Page 19
Leverage Targets 19 Calibrating on: Business mix (55% Utilities / 45% Midstream) Peer average leverage ratios Anchored to ‘BBB-mid’ Investment Grade Ratings 4.0x Adjusted Net Debt to Normalized EBITDA1,2 (excludes prefs + hybrids) 4.65x (including 50% debt treatment for prefs + hybrids) Leverage Targets (Medium to Long-Term) 4.4x 5.0x Adjusted Net Debt to Normalized EBITDA1,2 Trailing Metrics (As of Q4/24) (excludes prefs + hybrids) (including 50% debt treatment for prefs + hybrids) Notes: 1) Adjusted Net Debt is Net Debt excluding the current and long-term portions of finance lease liabilities, Hybrid notes, and debt associated with acquisitions that occurred in the last half of the fiscal year; 2) Non-GAAP financial measure; see discussion in the advisories; *See "Forward-looking Information“ Reduced Adjusted Net Debt by ~$460 million Y/Y in 2024 6 On Track to Reach Long Term Leverage Target in 2025
Page 20
20 Optimize Assets For Maximum Returns Increase throughput, extend asset lives and control opex to drive the highest long-term return on capital. 2025 Business Plan Continue to Execute on our Long-term Strategic Priorities Focus on growing, de-risking, and strengthening the enterprise. Active De-Risking Execute long-term commercial contracting across Midstream, systematic hedging, and active regulatory initiatives. Continued Balance Sheet Deleveraging Move towards our 4.0x adjusted net debt/normalized EBITDA1 leverage target. Operate with increased financial flexibility. Advance Key Growth Projects Execute on Utilities modernization programs, complete Pipestone II and material construction progress on REEF project. Continue to Take Actions to Drive Long-Term Per Share Value Focus on compounding long-term normalized EPS and FFO per share value. 1 2 3 4 5 AltaGas has Shown Strong Progress Across these Areas over the Past Year Notes: 1) Adjusted Net Debt is Net Debt excluding the current and long-term portions of finance lease liabilities, Hybrid notes, and debt associated with acquisitions that occurred in the last half of the fiscal year; *See "Forward-looking Information“ 6
Page 21
2018 2019 2020 2021 2022 2023 2024 2025E2018 2019 2020 2021 2022 2023 2024 2025E Normalized EBITDA1 2018 2019 2020 2021 2022 2023 2024 2025E Normalized Earnings Per Share1 Executing on Strategic Priorities to Compound Long-term Value 21 14% Normalized EPS CAGR 20182025E3 9% Normalized EBITDA CAGR 20182025E3 >5.5x Reduction in Adjusted Net Debt1,2 / Normalized EBITDA 2018 2024 >15% TSR CAGR since 2019 Dividends + Share Price Execution of Strategic Priorities Driving Superior Value Creation Notes: 1) Non-GAAP financial measure, see discussion in the advisories; 2) Adjusted net debt is defined as net debt adjusted for current and long-term portions of finance lease liabilities, Hybrid Notes, and debt associated with acquisitions that occurred in the last half of the fiscal year; 3) “E” denotes 2025 normalized EPS guidance ranges of $$2.10-$2.30 and 2025 normalized EBITDA guidance ranges of $1.775B - $1.875B, See “Forward-looking information” Adjusted Net Debt1,2 / Normalized EBITDA Share Price Performance Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 Dec-24 ALA-CA Midstream Index LDC Index Blended Index 7
Page 22
Appendix: Q4 2024 Variances 22
Page 23
23 Q4 2023 Actual Utilities Midstream Corp/ Other Q4 2024 Actual ▲ ARP modernization investments ▲ Lower O&M ▲ DC Rate case (2022) ▲ New meter growth ▲ Favourable USD/CAD FX rate, including hedging ▼ Retail performance (compared to outsized performance last year) ▼ WGL asset optimization ▼ Warm weather (D.C. & MI) ▲ Global exports performance (offset by higher tolling volumes) ▲ Addition of Pipestone assets (Pipestone I + Dimsdale) ▼ Lower Extraction earnings due to C2 re- injection ▼ Lower realized frac spreads ▼ Opex/G&A ▼ Lower MVP equity earnings (relative to AFUDC in Q4/23) ▼ Blythe performance due to transmission congestion ▼ Corporate G&A 252 294 Normalized EBITDA1,2 ($ millions) 0 Notes: 1) Non-GAAP financial measure; see discussion in the advisories; 2) Numbers may not add due to rounding. -4 Consolidated: Q4/24 vs. Q4/23 -7 25 502 520
Page 24
Consolidated: Q4/24 vs. Q4/23 24 Income (Loss) Before Income Taxes1 ($ millions) Q4 2023 Actual Utilities Midstream Corp/ Other Q4 2024 Actual ▲ Primarily same factors impacting normalized EBITDA ▼ Unrealized losses on risk management contracts ▼ Restructuring costs ▼ Higher depreciation and amortization ▲ Unrealized gains on risk management contracts ▼ Provisions on assets ▼ Higher depreciation and amortization ▼ Primarily same factors impacting normalized EBITDA ▼ Increased interest expense ▼ Provisions on assets ▲ FX gains ▲ Lower restructuring costs 161 Notes: 1) Numbers may not add due to rounding. 102 -21 -11 231
Page 25
Consolidated: Q2/23 vs. Q2/22 25 2023 Actual Utilities Midstream Corporate/Other 2024 Actual ▲ Partial settlement of WGL’s post retirement pension plan ▲ ARP modernization investments ▲ Lower O&M ▲ Retail performance ▲ DC rate case (2022) ▲ Favourable USD/CAD FX rate, including hedging ▲ Customer and new meter growth ▼ Asset optimization ▼ Alaska asset sale ▼ Warm weather ▼ MD rate case (2023) ▲ Global exports performance (offset by higher tolling volumes) ▲ Frac & Liquids handling volumes/ margins ▲ Addition of Pipestone assets (Pipestone I + Dimsdale) ▲ MVP earnings (1H24 AFUDC + 2H24 in-service) ▼ Lower Extraction earnings due to C2 re-injection ▼ Impact of contingency release in 2023 ▼ Opex/G&A ▼ Blythe performance due to transmission congestion ▼ Corporate G&A Normalized EBITDA1,2 ($ millions) Consolidated: FY 2024 vs. FY 2023 Notes: 1) Non-GAAP financial measure; see discussion in the advisories; 2) Numbers may not add due to rounding. See “Change in Composit ion of Non-GAAP Measures” within MD&A for additional details. -33 126 1,575 1,769 101
Page 26
912 26 Consolidated: FY 2024 vs. FY 2023 Income (Loss) Before Income Taxes1 ($ millions) YE 2023 Actual Utilities Midstream Corp/Other YE 2024 Actual ▲ Primarily same factors impacting normalized EBITDA ▲ Lower transaction costs ▼ Absence of gain from Alaska utilities disposition ▼ Restructuring costs ▼ Unrealized losses on risk management contracts ▼ Higher depreciation ▲ Primarily same factors impacting normalized EBITDA ▲ Higher unrealized gains on hedging ▲ Gains on asset sales ▲ Lower accretion ▼ Higher depreciation and amortization ▼ Provisions on assets ▼ Primarily same factors impacting normalized EBITDA ▼ Increased interest expense ▼ Provisions on assets ▼ Absence of gain on asset sales ▼ Lower unrealized gains on risk management contracts ▲ FX gains ▲ Lower transaction costs 912 -259 Notes: 1) Numbers may not add due to rounding. -93 186 746
Page 27
Midstream: Q4/24 vs. Q4/23 27 182 Q4 2023 Actual Midstream Q4 2024 Actual ▲ Global exports performance (offset by higher tolling volumes) ▲ Addition of Pipestone assets (Pipestone I + Dimsdale) ▼ Lower Extraction earnings due to C2 re-injection ▼ Lower realized frac spreads ▼ Opex/G&A ▼ Lower MVP equity earnings (relative to AFUDC in Q4/23) -18 -11 182 Normalized EBITDA1,2 ($ millions) Notes: 1) Non-GAAP financial measure; see discussion in the advisories; 2) Numbers may not add due to rounding. 0
Page 28
Midstream: FY 2024 vs. FY 2023 28 607 -17 684 Normalized EBITDA1,2 ($ millions) Notes: 1) Non-GAAP financial measure; see discussion in the advisories; 2) Numbers may not add due to rounding. 590 94 2023 Actual Midstream 2024 Actual ▲ Global exports performance (offset by higher tolling volumes) ▲ Frac & Liquids handling volumes/ margins ▲ Addition of Pipestone assets (Pipestone I + Dimsdale) ▲ MVP earnings (1H24 AFUDC + 2H24 in-service) ▼ Lower Extraction earnings due to C2 re-injection ▼ Impact of contingency release in 2023 ▼ Opex/G&A 684 101 785
Page 29
Utilities: Q4/24 vs. Q4/23 29 Q4 2023 Actual Utilities Q4 2024 Actual ▲ ARP modernization investments ▲ Lower O&M ▲ DC Rate case (2022) ▲ New meter growth ▲ Favourable USD/CAD FX rate, including hedging ▼ Retail performance (compared to outsized performance last year) ▼ WGL asset optimization ▼ Warm weather (D.C. & MI) Normalized EBITDA1,2 ($ millions) Notes: 1) Non-GAAP financial measure; see discussion in the advisories; 2) Numbers may not add due to rounding. 311 336 25
Page 30
Utilities: FY 2024 vs. FY 2023 Notes: 1) Non-GAAP financial measure; see discussion in the advisories; and 2) Numbers may not add due to rounding. 30 886 YE 2023 Actual Asset Sales & One-Time Items YE 2023 Run Rate Utilities YE 2024 Actual ▼ Sale of Alaska Utilities ▲ Partial settlement of WGL’s post retirement pension plan ▲ ARP modernization investments ▲ Lower O&M ▲ Retail performance ▲ DC rate case (2022) ▲ Favourable USD/CAD FX rate, including hedging ▲ Customer and new meter growth ▼ Lower asset optimization at WGL ▼ Debt defeasance in 2023 ▼ Warmer weather in Michigan ▼ MD rate case (2023) 1,012 Normalized EBITDA1,2 ($ millions) 870 -16 142
Page 31
Corporate/Other: Q4/24 vs. Q4/23 31 9 Q4 2023 Actual Corporate Q4 2024 Actual ▼ Blythe performance due to transmission congestion -8 Normalized EBITDA1,2 ($ millions) -7 Notes: 1) Non-GAAP financial measure; see discussion in the advisories; 2) Numbers may not add due to rounding. 2
Page 32
Corporate/Other: FY 2024 vs. FY 2023 32 5 YE 2023 Actual Corporate YE 2024 Actual ▼ Blythe performance due to transmission congestion ▼ Corporate G&A -28 Normalized EBITDA1,2 ($ millions) -33 Notes: 1) Non-GAAP financial measure; see discussion in the advisories; 2) Numbers may not add due to rounding;
Page 33
Contact Information For more information visit www.altagas.ca or reach out to one of the following: 33 Jon Morrison Senior Vice President, Corporate Development and Investor Relations Jon.Morrison@altagas.ca Aaron Swanson Vice President, Investor Relations Aaron.Swanson@altagas.ca Jennifer Sudermann Manager, Investor Relations Jennifer.Sudermann@altagas.ca Blake Nyberg Sr. Analyst, Investor Relations & Corporate Development Blake.Nyberg@altagas.ca