August 19, 2024 [Reuters]- Shares in Australia’s Ampol hit a 10-month low on Monday after the fuel retailer posted a weaker-than-expected half-year profit, hurt by disrupted production at its Lytton refinery in Queensland and softer global third-party sales.
Total production at the Lytton refinery was down nearly 6% in the first half, reflecting the impact of the refinery-wide steam outage.
Earnings before interest and tax for Ampol’s fuels and infrastructure (F&I) segment declined 26% to A$225.9 million ($150.61 million) for the six months ended June, hit by reduced international sales opportunities.
“The first half of 2024 saw a more stable market, particularly in the second quarter, reducing opportunities for discretionary sales activities resulting in lower volumes and margins, compared to the more favourable trading conditions in 2023,” the company said in a statement.
Ampol’s net profit after tax from continuing operations was A$233.6 million on a replacement-cost basis, compared with A$329.6 million a year ago and missing a Visible Alpha consensus estimate of A$256.3 million.
The Sydney-based firm declared an interim dividend of 60 Australian cents per share, down from last year’s 95 cents.
“Paying out an interim dividend from the midpoint of policy was weaker than expectations,” UBS analysts wrote.
“Heavier capital demands on the business over 2H and into 2025 plus a weak outcome expected at the refinery over 3Q24 should temper expectations of additional capital management at the full year.”
Shares of the company fell as much as 4.1%, by 0114 GMT, to their lowest since late October.
Ampol said turnaround and inspection activity at Lytton started in mid-July and production is expected to return to normal levels at the end of August.
Lytton refinery margins in the third quarter will be impacted by production mix during the turnaround, with production impact of about 300 million litres, it added.
Free Trial: Access 13,300 Tank Terminal and Production Facilities
13,300 tank storage and production facilities as per the date of this article. Click on the button and register to get instant access to actionable tank storage industry data
