Boost to premium fuel sales underpins Caltex earnings

Brian Robins
AUGUST 23 2016
The Age

A lift in sales of premium fuels helped to offset the squeeze on earnings at Caltex Australia from a steep decline in refining margins.
The net profit fell to $318 million in the June half from $375 million a year earlier on revenue of $8.5 billion down from $9.7 billion a year earlier.
A 50c a share interim dividend was declared, up from the 47c a share interim payout a year ago.
In late June, Caltex forecast a June half net profit of $310-$330 million, well short of the $375 million earned in the same period last year, due to lower refining margins at its Lytton refinery, not withstanding a rise in volumes of petrol sold.
The June half figure included $64 million of crude and product inventory gains, it said, while the year earlier figure included a $29 million profit from the sale of property.
In the half, sales rose to 7.7 billion litres with ongoing growth in premium fuels offsetting a decline in sales of both unleaded petrol and E10, a product which is 10 per cent ethanol.
On a replacement cost basis, which is the company’s preferred accounting treatment, the net profit edged ahead to $254 million from $251 million a year earlier. In June it forecast the net profit on this measure would run at $245-260 million.
There has been ongoing speculation Caltex could acquire the Woolworths-owned network of about 600 petrol stations, which the oil group supplies.
It completed a $270 million share buyback earlier this year.