24 February 2015 Financial Results Six months ended 31 December 2014 Presented by: Fraser Whineray Chief Executive MIGHTY RIVER POWER FINANCIAL RESULTS William Meek Chief Financial Officer FINANCIAL RESULTS Disclaimer The information in this presentation has been prepared by Mighty River Power Limited with due care and attention. However, neither the Company nor any of its directors, employees, shareholders nor any other person shall have any liability whatsoever to any person for any loss (including, without limitation, arising from any fault or negligence) arising from this presentation or any information supplied in connection with it. This presentation may contain projections or forward-looking statements regarding a variety of items. Such projections or forward-looking statements are based on current expectations, estimates and assumptions and are subject to a number of risks, uncertainties and assumptions. There is no assurance that results contemplated in any projections and forward-looking statements in this presentation will be realised. Actual results may differ materially from those projected in this presentation. No person is under any obligation to update this presentation at any time after its release to you or to provide you with further information about Mighty River Power Limited. A number of non-GAAP financial measures are used in this presentation, which are outlined in the appendix of the presentation. You should not consider any of these in isolation from, or as a substitute for, the information provided in the audited consolidated financial statements for the six months ended 31 December 2014, which are available at www.mightyriver.co.nz. Forward-looking statements are subject to any material adverse events, significant one-off expenses or other unforeseeable circumstances including hydrological conditions. The information in this presentation is of a general nature and does not constitute financial product advice, investment advice or any recommendation. Nothing in this presentation constitutes legal, financial, tax or other advice. MIGHTY RIVER POWER FINANCIAL RESULTS 2 FINANCIAL RESULTS Agenda Highlights 4 Market Dynamics 8 Operational Update 13 Financial Update 17 Business & Strategy Update 25 Outlook 33 Appendix 37 MIGHTY RIVER POWER FINANCIAL RESULTS 3 HIGHLIGHTS Active management optimising value over time MIGHTY RIVER POWER FINANCIAL RESULTS 4 HIGHLIGHTS Health and safety > Goal continues to be zero-harm – extensive engagement with contractors and subcontractors > no serious harm incidents during the period with TRIFR limited to low severity incidents > implemented contractor pre-qualification, providing a framework for improved safety standards > Aim for both industry and Company to be best in class > Industry-wide initiatives benefiting from StayLive including sharing of investigation outcomes MIGHTY RIVER POWER FINANCIAL RESULTS TOTAL RECORDABLE INJURY FREQUENCY RATE (TRIFR) (rolling 12 month, per 100,000 hours; includes contractors) 1.6 1.4 1.2 1.0 0.8 0.6 0.4 0.2 0.0 Dec 10 Dec 11 Dec 12 Dec 13 Jun 14 Dec 14 5 HIGHLIGHTS HY2015 vs HY2014 400 HY2014 HY2015 350 $m 300 250 200 150 100 50 0 Energy Margin EBITDAF NPAT Underlying Earnings Free Cash Flow Capital Expenditure Total Declared Dividend > Energy Margin, EBITDAF and Underlying Earnings impacted by lower hydro generation and the roll off of higher yield commercial contracts put in place in 2012 > Profit relative to prior period impacted by non-cash $83m impairment relating to exiting international geothermal development and favourable fair value movements of $20m recognised in the previous half year > Free cash flow and capital expenditure impacted by higher-than-average reinvestment capital expenditure (drilling two geothermal wells) MIGHTY RIVER POWER FINANCIAL RESULTS 6 HIGHLIGHTS Dividend > HY2015 fully imputed dividend up 8% to 5.6 cents per share > Guidance maintained of 14 cents per share FY2015 fully imputed dividend DIVIDEND PER SHARE Final Special 20 18 > new dividend policy targets 70% to 85% of Free Cash Flow on average over time > paid special dividend of 5 cents per share ($69m) in December 2014 > optionality for share buy back if beneficial to shareholders 16 14 Cents > Capital management continues to be reviewed Interim 12 10 8 6 4 2 0 2011 2012 2013 2014 2015F Financial Year MIGHTY RIVER POWER FINANCIAL RESULTS 7 105m? MARKET DYNAMICS Supply > Taupo inflows 82% of average, national inflows 101% of average over the last two calendar years > Since period end Taupo inflows only 57% of average, national inflows 81% of average NATIONAL AND TAUPO STORAGE LEVELS Below average storage National % of average Taupo % of average 95 Rolling 12 month average Otahuhu price (RHS) 90 160% 85 120% 75 MIGHTY RIVER POWER FINANCIAL RESULTS Jan 15 Oct 14 Jul 14 Apr 14 50 Jan 14 55 0% Oct 13 60 20% Jul 13 65 40% Apr 13 60% Jan 13 70 Oct 12 80% $/MWh 80 100% Jul 12 % of average 140% 9 MARKET DYNAMICS Demand & Supply balance > National demand up 2% on pcp, back to 2011 levels > Likely Tiwai will continue with 572MW > Reduction of 4,000GWh thermal fuel commitments across industry has restored the balance of energy demand and supply Base Case WINTER ENERGY MARGIN Reduced Thermal Generation 30% High Demand 25% Minimum Winter Energy Margin for Security of Supply % 20% 15% 10% 5% 2022 2021 2020 2019 2018 2017 2016 2015 2014 0% Source: System Operator, Transpower MIGHTY RIVER POWER FINANCIAL RESULTS 10 MARKET DYNAMICS Demand & Supply balance impacting wholesale prices > January 2015 demonstrated significantly higher spot prices compared to other years with similar hydrology WKM Average Spot Price ($/MWh) JANUARY SPOT PRICE VS NATIONAL STORAGE 120 100 2015 2006 2008 80 2004 2012 2014 2003 60 1999 2001 2013 2011 40 2002 2005 80% 90% 100% 2009 2007 2000 20 0 70% 2010 110% 120% 130% National Storage compared to average MIGHTY RIVER POWER FINANCIAL RESULTS 11 MARKET DYNAMICS Wholesale prices > ASX prices have responded to below average hydro storage (near-term) and reduced thermal fuel commitments (across the curve) > FY2016 ASX prices up $4.79/MWh (up 6%) since 30 June 2014 reflecting 4,000GWh less thermal fuel commitments – should begin to flow through to commercial pricing ASX FUTURES SETTLEMENT PRICE (OTA) 80 90 70 80 60 70 50 60 50 40 $/ MWh $/ MWh AVERAGE WHOLESALE PRICE (WKM) 30 20 10 40 30 20 10 0 0 HY2011 HY2012 HY2013 HY2014 Financial Year MIGHTY RIVER POWER FINANCIAL RESULTS HY2015 FY2015 FY2016 FY2017 As at 30 June 2013 As at 30 June 2014 As at 31 December 2014 As at 22 February 2015 12 FINANCIAL RESULTS OPERATIONAL UPDATE Electricity sales RESIDENTIAL SALES (FPVV) 1,500 GWh 1,450 1,400 1,350 1,300 1,250 1,200 HY2011 HY2012 HY2013 HY2014 HY2015 BUSINESS SALES 2,500 100 2,000 80 1,500 60 1,000 40 500 20 0 $/MWh GWh > Residential sales up 26GWh reflecting higher ICP’s and higher national demand > Business sales (FPVV) down 200GWh and Industrial sales (CFD) down 268GWh reflecting portfolio value-risk decision > Average FPVV price stable at $117.31/MWh supported by not renewing commercial volumes at low yield 0 HY2011 HY2012 HY2013 HY2014 HY2015 Business (end-user CFD excluding Norske Skog) Business (FPVV) Ave Wholesale price (OTA) MIGHTY RIVER POWER FINANCIAL RESULTS OTA Forward 6 mth 2 yr ASX 14 OPERATIONAL UPDATE Electricity generation > Generation 146GWh higher than HY2014 > hydro 412GWh (19%) less than average and 94GWh (5%) less than HY2014 given 18% below average inflows and decision to optimise water ahead of seasonally dry Autumn and expected higher wholesale price > high-cost thermal generation up 206GWh as used committed natural gas to support hydro and tolling agreement entered into in April 2014 (57GWh) > Nga Awa Purua de-rated by 10MW since December 2013 - turbine repairs expected to be completed by the end of Q1 FY2016 HYDRO GEOTHERMAL 3,000 2,500 AVERAGE 300 1,200 250 1,000 GWh GWh GWh 1,500 800 600 1,000 500 0 MIGHTY RIVER POWER FINANCIAL RESULTS 200 150 400 100 200 50 0 HY2011 HY2012 HY2013 HY2014 HY2015 MRP Generation 350 1,400 2,000 Tolling agreement GAS-FIRED 1,600 0 HY2011 HY2012 HY2013 HY2014 HY2015 HY2011 HY2012 HY2013 HY2014 HY2015 15 OPERATIONAL UPDATE LWAP/GWAP > LWAP/GWAP – ratio of the cost of electricity purchased (LWAP) relative to price received for generation (GWAP) > HY2015 LWAP/GWAP higher than peers but impacted by less North Island/South Island separation, lower hydro production and higher thermal production AVERAGE MONTHLY GWAP MRP GWAP Peer GWAP 160 140 LWAP/GWAP 1.06 1.04 $/MWh 120 1.02 100 1.00 80 60 0.98 40 0.96 20 MIGHTY RIVER POWER FINANCIAL RESULTS Jul 14 Jan 14 Jul 13 Jan 13 Jul 12 Jan 12 Jul 11 Jan 11 0 0.94 HY2011 HY2012 HY2013 HY2014 HY2015 16 0 FINANCIAL UPDATE Financial highlights $125. EBITDAF down due to low hydro and commercial volumes $176% Operating Cash Flow up $5m MIGHTY RIVER POWER FINANCIAL RESULTS $10m Cost savings in addition to $20m achieved in FY2014 5 per share Fully imputed Special Dividend paid in December 2014 $8309 Non-cash Impairments re?ect exit of international geothermal development options 5 I 6 0 per share Fully imputed Interim Dividend declared 18 FINANCIAL UPDATE EBITDAF (HY2015 vs HY2014) > Energy Margin down $19m > 94GWh less hydro generation and 468GWh less commercial sales (FPVV and CFD) > Higher fuel cost reflecting higher wholesale prices and more thermal generation (used committed gas to support storage) > Increased use of liquid ASX market to support water storage > $3m additional Other Income reflecting increased contribution from metering business and property sales and $4m lower Operating Expenditure Improvement Reduction Energy Margin down $19m 350 63 300 50 13 19 $m 250 3 4 200 150 258 270 100 50 0 EBITDAF HY2014 Generation MIGHTY RIVER POWER FINANCIAL RESULTS Fuel Cost CFDs Customer Sales Other Income Operating Expenditure EBITDAF HY2015 19 FINANCIAL UPDATE Operating expenditure (HY2015 vs HY2014) > In FY2014 focus on efficiency and effectiveness delivered $20m of permanent cost savings > Since year-end additional permanent cost savings found OPERATING EXPENDITURE 120 100 > international geothermal operating costs down $1m on pcp > additional savings from professional fees and contractors > Now expect FY2015 operating expenditure comparable with FY2014 MIGHTY RIVER POWER FINANCIAL RESULTS $m > 2 month benefit from savings from reduced insurance limit 80 60 105 101 HY2014 HY2015 40 20 0 20 FINANCIAL UPDATE Underlying earnings and NPAT (HY2015 vs HY2014) > Underlying earnings down $15m reflecting lower EBITDAF, in addition to higher depreciation, interest following the commissioning of Ngatamariki > NPAT relative to prior period impacted by non-cash $83m impairment relating to exiting international geothermal development and favourable fair value movements of $20m recognised in the previous half year Improvement $m Reduction EBITDAF down $12m 120 100 4 19 3 7 80 60 6 9 7 105 90 40 20 0 Underlying Earnings HY2014 Energy Margin Operating Expenditure MIGHTY RIVER POWER FINANCIAL RESULTS Other Income Depreciation Equity Accounted Earnings from Joint Ventures and Associates Net Interest Income Tax Underlying Earnings HY2015 21 FINANCIAL UPDATE Accounting implications of international geothermal development exit > Non-cash Impairments of $83m > full write-down Chilean assets (impairment of $56m) > sale of Germany complete (impairment of $13m) > review of US investments forecast revenue and costs and flow on impacts to tax equity financing carrying value now $12m (impairment of $14m) > Following completion of Chilean assets sale will crystallise non-cash FX translation reserve expense (worth approx $10m) MIGHTY RIVER POWER FINANCIAL RESULTS 22 FINANCIAL UPDATE Consolidated cash flow > Continued strong cash flow with operating cash flow of $176m > timing benefit from change in Vector’s line billing cycle and lower cash taxes Six months ended 31 December 2014 Six months ended 31 December 2013 $m change % change Twelve months ended 30 June 2014 Net cash provided by operating activities 176 171 5 2.9 317 Net cash used in investing activities (47) (64) 17 (26.6) (99) (118) (86) (32) 37.2 (213) 33 35 (2) (5.7) 19 $m Net cash (used in)/provided by financing activities Cash at the end of the period MIGHTY RIVER POWER FINANCIAL RESULTS 23 FINANCIAL UPDATE Capital expenditure > Capital expenditure of $56m (HY2014: $51m) > new investment of $14m (HY2014: $23m) includes smart metering spend* > stay-in-business of $42m (HY2014: $28m) reflects successful completion of Ngatamariki and Rotokawa geothermal drilling > Some re-phasing into FY2016. FY2015 guidance now $85m for stay-in-business (previously $95m) and $35m for committed growth capex (previously $50m) > FY2016 stay-in-business capex will include Nga Awa Purua turbine replacement of approx $7m 400 350 Committed Growth 300 Stay-in-business $m 250 288 200 150 183 163 35 100 33 50 57 74 69 60 85 2013 2014 2015F 0 2011 2012 * Excludes $13m non-cash exercise of Germany option included in PPE MIGHTY RIVER POWER FINANCIAL RESULTS 24 -IINANCIAL 1L5Business trategy Updafe?? MIGHTY RIVER POWER FINANCIAL RESULTS 25 BUSINESS AND STRATEGY UPDATE Customer > Passing on the benefits of strong competition > no increase in headline energy prices for residential electricity and gas customers in April 2015 > reward for loyalty – customers who commit for 2 years get additional 3% discount > 33% of customers on fixed price contracts > Leading reduced industry disconnections > Mercury reached record low in October of only 18 disconnected customers > GLOBUG assists customers’ cash management and keeps them connected > Focus on customer-led technology > rolled out Good Energy Monitor to small commercial customers > growth in digital customers continued - 78% of customers pay electronically and 51% receive bills online > GLOBUG online and app based self service MIGHTY RIVER POWER FINANCIAL RESULTS 26 BUSINESS AND STRATEGY UPDATE Driving efficiencies > Work on Whakamaru hydro to begin in Q4 FY2015 > expand capacity by 20MW and 5% increase in water efficiency > Southdown reconfiguration to a simpler, faststart mode completed > mothballed steam turbine - reduced generating capacity by 35MW > improved responsiveness to market opportunities while lowering operating costs > Sale of specific “surplus to requirements” properties > Reduction of insurance limit to the appropriate level for risk (from $2 billion to $1 billion) MIGHTY RIVER POWER FINANCIAL RESULTS 27 BUSINESS AND STRATEGY UPDATE Exit geothermal development options > In December announced exit of Chile and Germany, alongside no further development capital in US > International geothermal development options now not in line with investment objectives > challenging position vis a vis different fuels > disproportionate management and governance time > complexity of project financing, accounting and tax > Exit on track with Germany sale complete with no residual obligation and Chile process underway MIGHTY RIVER POWER FINANCIAL RESULTS 28 BUSINESS AND STRATEGY UPDATE GLOBUG – a smart platform for growth > Home-grown pre-pay technology > lowers disconnection rates and bad debts > GLOBUG online and app based self service > Lower cost of electricity for customers > eliminates late payment fees and use of debt collection agencies > Platform for growth > currently 18,000 GLOBUG customers > new lower price rate offer to Community Services Card holders (estimated 495,000 households) MIGHTY RIVER POWER FINANCIAL RESULTS 29 BUSINESS AND STRATEGY UPDATE Metrix – ramping up smart meter deployment > Smart meter deployment gains momentum > 367,000 meters now installed > 25,000 meters installed in HY2015, up from 10,000 in HY2014 > compliance deadline of 1 April 2015 for category 1 installations > Trustpower partnership supports growth > systems development and integration with Trustpower on track > absolute focus for Metrix team > full deployment starting in mid-2015 MIGHTY RIVER POWER FINANCIAL RESULTS 30 BUSINESS AND STRATEGY UPDATE Long-term opportunities to yield value over time Water > Tuwharetoa Maori Trust Board and Mighty River Power reached long-term partnership agreement over future of Lake Taupo Electric Vehicles (EVs) > Advancing partnerships on charging infrastructure (Novotel/Tainui Hamilton, Auckland Transport and carpark owners) > Mighty River Power fleet conversion underway as leases expire – 20 EVs by end of 2015 > Positive outlook with corporates on fleet conversion MIGHTY RIVER POWER FINANCIAL RESULTS 31 BUSINESS AND STRATEGY UPDATE Regulation and Legal Transmission Pricing Methodology (TPM) > Decision in 2015 challenging given process delays > options paper, expected shortly, will canvas wider set of options - not limited to beneficiary pays > Transpower operational review pragmatic and eliminates theoretical benefit from significant change to TPM > Current proposal would drive transmission price increases to upper North Island customers while reducing costs for South Island generators and Tiwai Legal > New Zealand Carbon Farming Case: High Court decision expected soon over a contractual dispute relating to the amount of carbon credits obliged to buy over time > SFO Case: Fraud hearing against former employee and his partner scheduled for February 2016 MIGHTY RIVER POWER FINANCIAL RESULTS 32 CIAL RESULTS MIGHTY RIVER POWER FINANCIAL RESULTS OUTLOOK FY2015 guidance and outlook > Maintained strong cash flow supporting the FY2015 dividend guidance of 14 cents per share > Following dry conditions 445GWh (worth $35m) reduction in hydro production forecast partly offset by operating cost savings and sale of surplus land > FY2015 EBITDAF will be in the range of $480m - $500m subject to any material adverse events, significant one-off expenses or other unforeseeable circumstances assumes: > 3,455GWh of hydro production which assumes average inflows from March until year end; > FY2015 operating costs comparable with FY2014; > the completion of additional property sales; and > excludes crystallisation of non-cash FX translation reserve loss which will occur on the completion of the Chile divestments (approx $10m) MIGHTY RIVER POWER FINANCIAL RESULTS 34 . OUTLOOK Fresh thinking Customer, Company, Country Operate MIGHTY RIVER POWER FINANCIAL RESULTS Grow Build . Tuwharetoa long-term agreement over Lake Taupo GLOBUG Community Services Card offer No increase in headline energy prices . Partnerships to deliver charging infrastructure for EVs . International geothermal development exit undenNay . Set for roll-out of Trustpower ?smart? meters mid 2015 Investment in Whakamaru hydro Additional operating cost savings 35 0 Wmmnu??m I 5?19? . 9. RESULI a w: . . rd}? MIGHTY RIVER POWER FINANCIAL RESULTS APPENDIX Operating information Six months ended 31 December 2014 Electricity Sales FPVV sales to customers Six months ended 31 December 2013 Twelve months ended 30 June 2014 VWAP1 ($/MWh) Volume (GWh) VWAP1 ($/MWh) Volume (GWh) VWAP1 ($/MWh) Volume (GWh) 117.31 2,409 117.74 2,582 117.70 4,844 Residential customers 1,338 1,312 2,449 Commercial customers 1,070 1,270 2,395 2,532 2,710 5,086 719 859 1,572 FPVV purchases from market Spot customer purchases Total NZEM purchases Electricity Customers (‘000) 73.05 3,251 54.80 3,568 71.16 6,658 385 382 382 North Island customers 350 345 347 South Island customers 35 37 35 Dual Fuel customers 41 39 40 AMI Meters ('000) 367 338 342 1 VWAP is volume weighted average energy-only price sold to FPVV customers after lines, metering and fees MIGHTY RIVER POWER FINANCIAL RESULTS 38 APPENDIX Operating information Six months ended 31 December 2014 Six months ended 31 December 2013 Twelve months ended 30 June 2014 VWAP ($/MWh) Volume (GWh) VWAP ($/MWh) Volume (GWh) VWAP ($/MWh) Volume (GWh) Hydro 75.82 1,755 58.78 1,849 74.86 3,497 Gas 76.60 294 78.69 88 86.13 125 67.65 1,237 50.47 1,217 66.68 2,451 67.97 116 51.64 104 68.91 222 72.65 3,404 55.98 3,258 71.69 6,295 Electricity Generation Geothermal (consolidated)1 Geothermal (equity accounted)2 Total LWAP/GWAP 0.98 1.01 0.99 VWAP ($/MWh) Volume (GWh) VWAP ($/MWh) Volume (GWh) VWAP ($/MWh) Volume (GWh) $/GJ PJ $/GJ PJ $/GJ PJ Retail purchases3 9.21 0.61 8.83 0.60 8.96 1.02 Generation purchases 6.93 2.794 8.74 1.09 7.92 1.72 Gas Purchases Carbon Emissions (‘000 tonnes) MIGHTY RIVER POWER FINANCIAL RESULTS 294 217 1 2 3 4 Includes Mighty River Power’s 65% share of Nga Awa Purua generation Tuaropaki Power Company (Mokai) equity share Prices include fixed transmission charges Includes the virtual peaker operation 427 39 APPENDIX Contracts for Difference Six months Six months ended ended 31 December 31 December 2014 2013 Twelve Six months Six months Six months months ended ended ended ended 30 31 December 31 December 31 December June 2014 2012 2011 2010 Net Contracts for Difference (Sell)/Buy GWh Sell - End User (844) (1,112) (1,976) (1,153) (973) (1,063) (352) (327) (674) (302) (151) (-) (543) (341) (605) (684) (401) (425) Sell CFD (1,739) (1,780) (3,255) (2,139) (1,525) (1,489) Buy CFD 894 1,226 2,230 1,285 691 456 CFD (846) (554) (1,025) (854) (834) (1,033) Energy Margin contribution ($m) $15m $28m $24m $3m $10m $33m Sell - VAS1 Sell - Inter-generator & ASX 1 VAS included on both buy and sell side CFDs MIGHTY RIVER POWER FINANCIAL RESULTS 40 APPENDIX Balance sheet As at 31 December 2014 As at 31 December 2013 $m change % change As at 30 June 2014 3,010 3,185 (175) (5.5) 3,219 270 273 (3) (1.1) 292 Non-current assets 5,293 5,404 (111) (2.1) 5,397 Total assets 5,563 5,677 (114) (2.0) 5,689 212 314 (102) (32.5) 271 Non-current liabilities 2,341 2,178 163 7.5 2,199 Total liabilities TOTAL NET ASSETS 2,553 3,010 2,492 3,185 61 (175) 2.4 (5.5) 2,470 3,219 $m SHAREHOLDERS’ EQUITY Total shareholders’ equity ASSETS Current assets LIABILITIES Current liabilities MIGHTY RIVER POWER FINANCIAL RESULTS 41 APPENDIX Funding profile and ratios DEBT MATURITIES AS AT 31 DECEMBER 2014 Undrawn Bank Facilities Domestic Capital Bond Domestic Wholesale Bonds US Private Placement 400 300 200 100 0 2015 2016 2017 2018 2019 2020 2021 2022 Financial Year 2023 2024 2025 2026 2045 31 December 2014 30 June 2014 30 June 2013 30 June 2012 30 June 2011 30 June 2010 1,080 1,031 1,028 1,116 976 971 Gearing ratio (%) 26.4 24.3 24.4 27.0 25.1 26.5 Debt/EBITDAF (x) N/A 2.1 2.7 2.6 2.2 3.0 Net debt ($m) MIGHTY RIVER POWER FINANCIAL RESULTS 42 APPENDIX Non-GAAP measure: Energy margin > Energy Margin provides a measure that, unlike sales or total revenue, accounts for the variability or the wholesale spot market and the broadly offsetting impact of wholesale prices on the cost of retail electricity purchases Six months ended 31 December 2014 Six months ended 31 December 2013 Twelve months ended 30 June 2014 856 827 1,672 Less: lines charges (223) (227) (431) Less: energy costs (266) (216) (505) Less: other direct cost of sales, including metering (26) (24) (49) Energy Margin 341 360 687 $m Sales MIGHTY RIVER POWER FINANCIAL RESULTS 43 APPENDIX Non-GAAP measure: Free Cash Flow > Free Cash Flow is a measure that the Company uses to evaluate the levels of cash available for debt repayments, growth capital expenditure and dividends Six months ended 31 December 2014 Six months ended 31 December 2013 Twelve months ended 30 June 2014 Net cash provided by operating activities 176 171 317 Less: Reinvestment capital expenditure (including accrued costs) (42) (28) (60) Free Cash Flow 134 143 257 $m MIGHTY RIVER POWER FINANCIAL RESULTS 44 APPENDIX Non-GAAP measure: Net Debt > Net Debt is reported in the financial statements and is a measure commonly used by investors As at 31 December 2014 As at 31 December 2013 As at 30 June 2014 10 105 56 1,127 972 985 Add: Fair adjustments US Private Placement (24) 2 9 Less: cash and cash equivalents (33) (35) (19) 1,080 1,044 1,031 $m Current borrowings at carrying value Add: Non-current loans at carrying value Net Debt MIGHTY RIVER POWER FINANCIAL RESULTS 45 APPENDIX Non-GAAP measure: EBITDAF, Underlying Earnings and Net Debt > EBITDAF is reported in the financial statements and is a measure that allows comparison across the electricity industry > Underlying Earnings is reported in the financial statements and in contrast to net profit, the exclusion of certain items enables a comparison of the underlying performance across time periods > Net Debt is reported in the financial statements and is a measure commonly used by investors MIGHTY RIVER POWER FINANCIAL RESULTS 46